Business

Zim inflation spikes to 175,66%

BY STAFF REPORTER ZIMBABWE’S year-on-year inflation rate for the month of June 2019 rose sharply by 77,75 percentage points to 175,66% from 97,85% in May 2019, driven by increases in the price of basic goods, the statistics agency reported yesterday. “The month-on-month food and non-alcoholic beverages inflation rate stood at 55,07% in June 2019, gaining 37,44 percentage points on the May 2019 rate of 17,63%. The month-on-month non-food inflation rate stood at 31,23%, gaining 21,11 percentage points on the May 2019 rate of 10,12%” the Zimbabwe National Statistics Agency (Zimstat) said. The month-on-month inflation rate in June 2019 was 39,26%, gaining 26,72 percentage points on the May 2019 rate of 12,54%. The annual inflation rate has been on the rise since the beginning of the year. It o...

Zim plans factories for 63 districts

ZIMBABWE plans to set up at least one factory in each of the country’s 63 districts as authorities attempt to improve standards of living for people in economically backward areas. BY FIDELITY MHLANGA The recently launched Zimbabwe National Industrial Policy (ZNIDP), spanning 2019-2023, intends to promote decentralisation of industrialisation initiatives in line with devolution that recognises that the majority of Zimbabweans are domiciled in the rural areas. “Government will promote industrialisation through provision of incentives and targeted financing, policy support and business development services for the establishment of micro, small, medium and large scale manufacturing industries in rural areas in line with available local resources. There shall be a deliberate thrust to develop ...

‘Parliamentary Committees recommendations should be taken seriously’

GOVERNMENT should implement recommendations made by Auditor-General (AG) Mildred Chiri and Parliament before allocating any funds to line ministries, a legislator has urged. BY MTHANDAZO NYONI Chairperson of the portfolio committee on Budget, Finance and Economic Development , Felix Mhona made the suggestion while addressing a budget analysis workshop for lawmakers held in Bulawayo recently. “It is high time our recommendations as Parliamentary Committees are taken seriously and feed into the national budget. I believe that it is time that this new dispensation ensures that no public funds are disbursed to any line ministry without the Executive implementing the recommendations raised by the Auditor General as well as Parliament, especially, those from the post audit committee, the Public ...

SA’s Nampak makes progress in talks for glass unit sale

JOHANNESBURG — South African diversified packaging group Nampak has made significant progress in negotiations to sell its Glass business, it said yesterday. Nampak, which operates in 11 African countries as well as Ireland and the United Kingdom, began exploratory discussions with a number of strategic players in 2018. In February, Nampak said following its decision to sell the glass unit, it initiated a “competitive” disposal process, which resulted in the firm entering into an exclusivity arrangement with the preferred bidder. The sale was originally scheduled to be concluded by April 2019. The preferred bidder was a black South African-owned company supported by a large international corporation with significant glass expertise, the firm said at that time. “The parties are still fully c...

NetOne dials US$10m FY18 profit

By Business Reporter State-owned mobile network operator, NetOne, recorded a US$10 million profit in 2018 from a loss position of US$77 million in the previous year driven by an increase in revenue and improved efficiency. Chief executive Lazarus Muchenje told an annual general meeting yesterday that cost containment measures resulted in a 21% decline in overheards margin. During the period under review, the company’s revenue grew 13% to US$119,2 million. “The year 2018 witnessed the resurgence of NetOne as the leading network of choice in Zimbabwe, with a historic $88 million turnaround from a loss position of $77 million in 2017, to a profit of US$10 million in 2018,” Muchenje said. Earnings Before Income Tax Depreciation and Amortisation more than doubled to US$38,2 million from US$15,1...

Zim needs US$34bn for infrastructure: AfDB

BY FIDELITY MHLANGA Zimbabwe requires at least US$34 billion to revamp its infrastructure over the next decade, a new report by the African Development Bank (AfDB) has shown. With recurrent expenditure taking an upwards of 90% of government revenues, the southern African nation has not made any meaningful investment towards public infrastructure, which is in a state of decay. According to the Zimbabwe Infrastructure Report 2019 released yesterday, the amount, which is based on 2017 prices, covers the undertaking of energy, sanitation, transport, and information and communication technology projects by 2030. “The proposed action programme for infrastructure for the decade ahead is comprehensive and ambitious. Its aim is to rehabilitate and upgrade the bulk of the basic infrastructure assets...

Zim firms hopeful after DRC sojourn

BY MTHANDAZO NYONI ZIMBABWEAN firms which recently attended the Democratic Republic of Congo (DRC)’s Mining Week say they are hopeful of generating business from the trade forum. ZimTrade director operations Phillip Phiri told journalists on the sidelines of the Zambia market survey results seminar held in Bulawayo yesterday that orders worth US$2,2 million were currently under consideration. “We took about 10 companies there and from those companies, quite a significant amount of business was generated and some orders that are actually (being negotiated) at the moment and the orders that were confirmed at the DRC mining week was actually US$560 000,” Phiri said. “We have got more than US$2,2 million orders that are under negotiation from the DRC exhibition we took part in. To me, that’s a...

Mobile money cash-in transactions jump 11,5%

BY TATIRA ZWINOIRA MOBILE money cash in transactions rose 11,5% to $1,17 billion in the first quarter of 2019 from $1,05 billion in the previous quarter as the country’s cash woes continued. “There was growth in Cash-In transactions as well as airtime, bill and merchant payments in the quarter under review,” reads part of the Postal Telecommunications Regulatory Authority of Zimbabwe (Potraz)’s 2019 first quarter report. “Ecocash processed 99,4% of the total value of transactions whereas Telecash and OneMoney processed 0,1% and 0,5% respectively.” The EcoCash platform is run by Econet Wireless. “Mobile money services are expected to continue playing a key role of bridging the financial divide by providing safe, secure and cheap financial services in areas where many Zimbabweans have no acc...

Zim trade deficit narrows by 71%

BY MTHANDAZO NYONI ZIMBABWE’S trade deficit narrowed by 71% to $325 million between February and May this year, with analysts attributing the decline to foreign currency shortages as well as a drop in the budget deficit. However, trade figures for January 2018 are still not available as the Zimbabwe Revenue Authority, which is the source of merchandise trade data, has not produced them, according to the Zimbabwe Statistics Agency (ZimStat). Figures released by ZimStat show that between February and May, the country imported goods and services worth $1,59 billion against exports of $1,27 billion. In the same period last year, imports stood at $2,34 billion and exports at $1,23 billion, giving a trade deficit of $1,1 billion. Exports slightly improved by 3% on the prior year figures, while i...

World Bank allocates US$300k towards IPSAS implementation

BY FIDELITY MHLANGA The World Bank has allocated US$300 000 towards implementation of International Public Standards (IPSAS), which will see government adapt an accrual-based reporting framework to enhance transparency and financial accountability, an official has said. Currently, government is using a cash accounting-basis technique, which only reflects current expenditures against cash available. The technique does not encourage full disclosure of liabilities and debtors. Finance secretary George Guvamatanga said adoption of IPSAS will help increase confidence in government records as it requires extensive disclosures from public sector entities. “The public sector is key in the economic reform agenda and, therefore, as government we cannot understate the need to ensure that the migratio...

Govt targets unregistered downtown shops

BY FIDELITY MHLANGA GOVERNMENT will soon pounce on unregistered shops in downtown Harare, which it blames for fuelling the parallel market for foreign currency and other illegal activities, Industry and Commerce Minister, Mangaliso Ndlovu, has said. The shops known as “matuckshop” are popular with locals for selling products at lower prices than registered formal shops, but authorities say they are at the heart of a thriving black market for currency and trade of goods smuggled into the country. Ndlovu, said he would ensure that shop owners have proof of payment of taxes, proof of banking records and compliance to tax regulations. “The shops down town are not formally registered. We will have a programme on reserve sector compliance. Everyone in the reserve sector has to be registered and ...

Pharmacies owe US$30m to foreign suppliers

BY MTHANDAZO NYONI THE Pharmaceutical Wholesalers’ Association (PWA) says international suppliers have put them on advance payment terms because its members owe the external suppliers over US$30 million in legacy debt, spanning over 18 months. PWA chairperson Kuda Chapfika told NewsDay that the legacy debt was crippling their operations. “External suppliers are owed over US$30m in legacy debt, spanning over 9-18 months. The future depends on us meeting our payment obligations so that we can get the products into the country and supplies can continue uninterrupted. At least 70% of medicines that are consumed in country are imported,” Chapfika said. “The support at this point in time needs to come in the form of financing to settle the legacy debt. Once this is done, the supply chain of medi...