‘AGrIc To AncHor ZIm’S Q2 EconomIc rEcovEry’: P7 News Worth Knowing Pay other lenders first, IMF says: P3 February 25-March 03 2021 ESTABLISHED 1969 @ FingazLive www.fingaz.co.zw Facebook: The Financial Gazette Z$260 ZSE Report TRADING on the Zimbabwe Stock Exchange (ZSE) was on a recovery path yesterday after 24 stocks recorded gains Gvt calls and 12 stocks in traded the negative. The biggest advancers were Natfoods at 20 percent and Unifreight 20 percent where- as the biggest losers were African Sun at 11,64 percent and Zimpapers down 10,71 percent. The total quantity traded was 12,6 million shares worth $89,5 million with Ok Zim trades valued at $21 million, Meikles 14,6 million and Simbisa Brands for trade dominating trades in terms of value. Currencies (Bloomberg) % change ◀ USD:ZAR 14,5655 0,15 ◀ EUR:USD 1,2162 0,10 ◀ GBP:USD 1,4156 0,30 ◀ USD: JPY 105,7600 0,48 Stock Markets ◀ ZSE All Share 4,075,87 2,28 ◀ 2,432,78 2,24 restraint Top 10 ◀ JSE 66,678.30 1,15 FTSE 100 6,618.69 ◀ 0,11 ◀ Dow 31,537.35 0,05 Commodities ◀ Gold 1,805,81 0 ◀ Platinum 1,266,90 1,92 ◀ Brent Oil 65,84 0,72 Grains (Grain SA) ◀ on prices White Maize ZAR 3,255 12,00 Soya ZAR 8,960 185,00 ◀ ◀ Tendai Kamhungira been accused of accessing foreign curren- Wheat ZAR 5,095 13,00 Senior Staff Writer cy through the RBZ’s much-lauded week- ly auctions, and then allegedly going on Zinara gets nod HE government has called for mar- to sell their products using parallel market ket discipline and self-restraint by rates — thereby introducing market dis- to raise road T traders following the recent surge tortions. in prices of some goods in the country. “We are very worried about the extent Speaking on Tuesday during a Daily of the current levels of market indisci- rehab funds News webinar that unpacked the Reserve pline, and the government strongly sup- THE government has authorised the Bank of Zimbabwe (RBZ)’s recent Mon- ports the action by the RBZ to have the Zimbabwe National Road Adminis- etary Policy Statement, the ministry of necessary punishment for those who are tration to source funding on the mar- Finance’s permanent secretary, George abusing the auction system. ket for a US$400 million emergency Guvamatanga, said the creeping indisci- “In fact, we have actually been dis- road rehabilitation programme. The financing will be in advance pline by some businesses was threatening cussing with the central bank to introduce of allocations yet to come from the the stability of the markets. further legislation to ensure that we curb Treasury. As a result, he warned, the government that indiscipline before it becomes market This comes after the government would not hesitate to consider enacting failure. declared the country's roads a state appropriate legislation going forward, to “We are also concerned by the wan- of disaster, following incessant rains curb abuses of the foreign currency auc- ton increases in prices we have witnessed across the country. tion system and unjustified price increas- over the past two months, which we be- John mangudya, the central bank governor, says diaspora remittances The programme will cover cor- into Zimbabwe increased by a massive 57,6 percent from US$635,67 es. lieve are not justifiable,” Guvamatanga rective, preventive and restoration million in 2019 to US$1 billion in 2020. See story on Page 11 This comes as a few businesses have said. To Page 2 works over the next 36 months. Page 2 | February 25-March 03 2021 The Financial Gazette News Gvt calls for trade restraint on prices From Page 1 the back of an anticipated bumper has pinned the country’s econom- tomer due diligence and customer “There is no justification what- agricultural season this year. ic revival on agriculture — in the profiling,” Mangudya said. soever for this current level of He added that the good agri- process, setting for itself an ambi- “Some people are going to the pricing of $110 or $120 (trading cultural season would also see tious target of achieving a US$8,2 extent of selling the proceeds they Zimbabwe dollar exchange rate to the government saving signifi- billion agriculture economy by would have received in foreign the greenback) that we are seeing cant sums of foreign currency that 2025. currency to the black market at in the market. would otherwise have been used With improved output from ag- $100 and coming back to the auc- “We will see the course of for imports — and which resourc- riculture, coupled with the easier tion, bidding at $82 to $85 — and events in the next week and the es would be channelled to social availability of foreign currency, that is wrong. first two weeks of March. If there services. Mangudya said the manufactur- “There are people, companies is no significant change by then, “We are banking on a favour- ing sector was also set to recover and entities that have the propen- this could actually force govern- able agriculture season to contain since it drew 70 percent of its raw sity to abuse the auction system. ment to intervene, but it’s not our food prices. We, therefore, antic- materials from the agricultural We think that we should be a nor- intention to do so. ipate increased food production sector. mal economy where we do every- “So, we hope that the market due to the favourable agriculture In addition, he said, the RBZ thing above board,” he also said. will take heed and take the nec- season which will support ex- was working hard to ensure that “Our Financial Intelligence essary steps to make sure that ports, reduce imports and ease banks and other participants in Unity (FIU) has enhanced its there is market discipline,” Guva- pressure on the fiscus. George Guvamatanga the country’s foreign exchange monitoring and surveillance to matanga added. “We also expect inflation to system complied with auction make sure that those who are mis- He further observed that fall because of the favourable rules — to curb potential abuses behaving are brought to book. among “the biggest culprits (in agriculture season. Our food in- "We will see the of the foreign exchange auctions, “We are also refining the com- this regard) are players in the flation is mainly because of im- which contributed to price surges. pliance regulations, as well as the pharmaceutical sector, as well as ported inflation. course of events in “On this note, we have seen that fines and our methods in order to hardware stores”. "We have been importing the next week and there is a new spirit of non-com- curtail the mischief. The RBZ introduced the for- maize, wheat and crude soya oil, the first two weeks of pliance creeping in and slipping “We are also putting in place eign currency auction system last whose prices have been going through the hands of banks, where a statutory instrument to ensure June to first stabilise, and then up. March. If there is no some shelf companies are being that the fines are increased, so boost the country’s economy — “In Zimbabwe, we have im- significant change by formed so that they come to the that we hit the pockets of those a move which helped to tame the ported inflation from outside the foreign currency auctions to get who misbehave and that the FIU then rampant forex parallel mar- country which we cannot con- then, this could actu- foreign currency. is improved. ket. trol. ally force government “We have seen that in this "We also have no qualms in Addressing the same Daily "So, when we grow more food economy, foreign currency is not freezing the accounts of offend- News webinar, central bank gov- we expect the price of maize and to intervene, but it’s always used for transacting pur- ing parties,” Mangudya warned ernor John Mangudya said Zim- wheat products, as well as cook- not our intention to poses, but as a store of value. further. babweans could look forward to ing oil to stabilise,” Mangudya do so." “It is precisely because of this See also Page 8 a further improvement in their said. point that we are calling upon all [email protected] lives and more stable prices on This comes as the government banks to ensure that they do cus- The Financial Gazette @FingazLive RBZ bonds mop-up $14bln Omega Ukama money growth to 22,5 percent from 25 per- Companies Editor cent, which it says is consistent with annual inflation of below 10 percent and economic HE Reserve Bank of Zimbabwe growth of 7,4 percent being pursued by the (RBZ) mopped up $14,1 billion of government. Develop financially Texcess liquidity through open market Analysts who have characterised the sta- operations (OMO) between October and bility seen in the economy in recent months December last year, which it says aided con- as “fragile”, however, say this is at risk as literate business leaders tainment of money supply below set targets. unplanned government expenditure remains Reserve money — the fundamental a “not so distant possibility”. component of money supply — closed 2020 “While the 2021 national budget indi- at $18,76 billion, compared to a target of cates a shift from Command to Smart Ag- $25,20 billion, according to the apex bank. riculture, we cite that there is scope for un- “In line with its conservative monetary planned government expenditure in 2021, targeting framework, the bank escalated particularly as we move towards an election OMO from October 2020 by aggressively year in 2023,” Morgan & Co, a local equi- mopping up excess liquidity through the is- ties firm said last week in a note.