Champions Goes Hi-Tech
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GVT TO RAKE IN $1BN FROM NEW TAX BY YEAR-END: Page 2 $4 News Worth Knowing Politics fuelling governance failures: Page 5 February 14-20 2019 ESTABLISHED 1969 @ FingazLive www.fi ngaz.co.zw Facebook: The Financial Gazette ZSE Report THE All Share index recov- Broke Zim ered 1,60 percent yesterday to close at 152,90 points. SeedCo International led the movers with a $0,25 gain to settle at $2. Cassava Smartech put on $0,1 to close at $1,46, while PPC traded $0,08 high- er at $1,88. The Industrial in- dex was up by 1,62 percent to bonds its close at 510,02 points, and the Top 10 index gained 2,03 per- cent to close at 151,59 points. The Minings index was fl at at 217,92 points. Currencies (Bloomberg) % change ◀ USD:ZAR 14,8338 1,63 EUR:USD 1,1316 0,26 ◀◀ ◀ GBP:USD 1,2764 0,46 ◀ ◀◀ resources USD: JPY 113,2900 0,14 Stock Markets ZSE (All Share) 166,82 1,49 ◀ ZSE (Mining) 217,34 0,36 ◀ JSE 16 366,00 0,16 FTSE 100 7 142,33 1,52 1,48 Dow 25 243,54 Commodities (Bloomberg) 0,82 Gold 1 212,90 ◀ Platinum 836,31 0,02 until 2020 ◀ 0,42 Shame Makoshori rare had indeed secured some credit lines from Brent Oil 75,59 ◀ and Omega Ukama Afreximbank through bonded bullion exports, Grains (Grain SA) Staff Reporters while dismissing assertions that this was also the White Maize ZAR 2 101,36 1,0 ◀ case with the country’s golden leaf. Soya ZAR 4 483,09 2,7 ◀ ITH international lenders continuing “The lines of credit (LCs) from Afreximbank Wheat ZAR 2 687,49 1,8 to shun Zimbabwe due to its dismal are structured against gold export receivables ... ◀ Wrepayment record and toxic politics, There are no facilities which are secured by to- President Emmerson Mnangagwa’s skint gov- bacco until 2020,” he said. ernment has resorted to mortgaging the coun- “Tobacco facilities from tobacco merchants, Champions try’s gold and tobacco revenues — since 2017 to assist tobacco growers, are short term arrange- — to a few external partners who are still willing ments handled by banks,” Mangudya, who has goes hi-tech to do business with Harare. had the onerous job of keeping the country afl oat SHORT-TERM insurer The Financial Gazette learnt this week that over the past fi ve years, said. Champions Insurance is next among the lenders from whom badly needed But government insiders said with Mnangag- week expected to launch credit lines have been secured this way is the Af- wa’s administration continuing to fail to raise a mobile application for a rican Export and Import Bank (Afreximbank), cash through normal budget activities owing range of its services, includ- which has regularly funded the country against to decades of fi nancial mismanagement and its ing car, housing, agricultur- export receivables. pariah status dating back to Robert Mugabe’s NICOZDIAMOND Insurance managing director Grace Mu- al, legal, plant and machin- But both analysts and government insiders days, the southern African nation has increas- radzikwa at her offi ce in Harare yesterday. Her company post- ery. say while these desperate measures have al- ingly sought help from “some dubious funders”, ed a gross premium written of $19,3 million in the six months to This also comes as the lowed Zimbabwe to get by, the practice is both mostly from Asia. June 2018 — up four percent compared to same period prior year. group, which has forged a unsustainable and potentially prejudicial to the And these loan sharks have apparently The performance was “a result of organic growth” by its recent- strong roll-out alliance with country — in addition to being problematic in pounced on such commodity-backed deals as to- ly-launched Post Insurance business. Nicozdiamond delisted from OK Zimbabwe, is reportedly some instances from a governance point of view. bacco worth $1 billion-plus every year — and 90 the Zimbabwe Stock Exchange in August last year after it was ac- mulling an expansion of its Reserve Bank of Zimbabwe (RBZ) governor percent of which is consumed in China. quired by First Mutual Holdings. — Picture by Freedom Mashava products to include medical John Mangudya confi rmed this week that Ha- To Page 2 and travel insurance. Page 2 | February 14-20 2019 The Financial Gazette National News Gvt rakes in $320m from 2% tax Nelson Gahadza months — October to January — ply, companies are unable to do that Ncube applauded Nestle Zimba- Business Reporter prompting market experts to believe sometime failing to that at all, and im- bwe for showing resilience and com- that the two percent tax has potential pacting the company’s ability to keep mitment to Zimbabwe through its IMBABWE’S cash-strapped to raise about $3,4 billion annually. their foreign shareholders happy. massive investments at a time when government has so far collected The analysts assert that if the cur- “It reduces their appetite to invest other investors are taking a wait-and- Zover $320 million in additional rent trend is sustained, the formula more in this country because capital see approach. revenue from the two percent tax, with to deal with the country’s domestic can go in where it can get out, but as “I was able to see some of the the money being distributed allocated debt would have been found and this government we are doing everything machinery that requires to be re-com- to various projects in social services, will enable authorities to put other what we can to ameliorate the situa- missioned. Because of the shortages infrastructure and devolution. economic fundamentals in place that tion,” he said. of foreign currency and some of the The controversial tax was intro- might see the realisation of a middle Zimbabwe is experiencing an spare parts, they could not be able to duced in October last year by Finance income status sooner than later acute foreign currency shortages due do that. minister Mthuli Ncube to broaden the Meanwhile, Ncube said govern- to weak exports and high government “We will do everything we can do country’s tax base as part of a series ment was working on a cocktail of expenditure resulting in the country to support then and ensure that the measures he’s implementing to stabi- measures to ensure that companies failing to provide companies and in- plants are re-commissioned and be lise the economy. and foreign investors are able to repa- vestors with hard currency to procure able to meet demand both domesti- “So far we have firm figures from triate their funds. raw materials. cally and within the region,” he said. the intermediary tax…We are averag- “If you are a foreign investor you The southern African country cur- Nestle Zimbabwe’s Swiss-based ing $80 million a month because we are allowed to take out 100 percent rently owes international airlines over parent company, has over the past gave a lot of exemptions,” Ncube told of your earnings, dividends and re- US$150 million, while industry has a five years injected over $30 million journalist during a tour of Nestle Zim- patriate your profits. However, due to foreign currency backlog of nearly into the local unit. babwe this week. the cuteness of foreign currency sup- US$1 billion. [email protected] This shows that the country has Mthuli Ncube raked in at least $320 million in five Broke Zim bonds its CITY OF BULAWAYO COMMERCIALISED ENTITIES Trading as INGWEBU BREWERIES resources until 2020 EXPRESSION OF INTEREST From Page 1 babwe. Chinese companies buy to- “For example, it is also not very EFFLUENT PLANT “In the absence of credible revenue bacco worth hundreds of millions ev- clear why Zimbabwe has not made plans, the government has resorted to ery year from Zimbabwean farmers. big efforts to be readmitted into the desperate measures such as hawking “Some of the companies have con- London gold market, even though the country’s gold, tobacco and other tracts ... where they provide inputs. the requirements for that have been resources to lenders,” one of the well- Outside this ongoing relationship, met,” economist and Percycon Ad- placed sources said. there is no arrangement between Chi- visory Services founder Persistence “The real concern is whether pro- na and Zimbabwe for tobacco. Gwanyanya said. Please be advised that the above ceeds from these forward contracts, “I have not heard of such an ar- “Ideally, Treasury should seek ap- many of which run until 2020, can rangement between the two govern- proval from Parliament on these loan mentioned advert has been be accounted for and are used for ments,” Baogang told The Financial agreements. The fact that the country national development or simply end Gazette this week. has been breaching statutory limita- CANCELLED and all processes have up financing some dodgy activities Deputy Agriculture minister, Van- tions ... shows that Parliament has not as offsetting Zanu PF’s 2018 cam- gelis Haritatos, referred questions on been allowed to exercise oversight,” been STOPPED until further notice. paign-material debts. this to the RBZ. he said. “Like the vaunted $500 million “I would be lying if I gave you a “People have always wondered LC’s from Burundi’s Eastern and comment on this matter. I actually do why Afreximbank is comfortable Southern African Trade, and Devel- not know if there is such an arrange- dealing with Zimbabwe, and now we Any inconvenience is sincerely regretted. opment Bank, the other problem with ment. Our ministry deals with matters hear that gold is involved.