Zim News Blog -NEWS NETWORK

Source: RBZ ring-fences pension values | Sunday Mail

Tawanda Musarurwa
Senior Business Reporter

The Reserve Bank of Zimbabwe (RBZ) will continue to help pension companies preserve the value of their funds in United States dollars, the bank’s Governor, Dr John Mangudya, said on Friday.

As at June 30 last year, the pension industry had six life offices insuring 860 pension funds.

There have been growing concerns that pension savings would be eroded after central bank liberalised the exchange rate by introducing the inter-bank market last week.

It is believed that removing the 1:1 peg of the US dollar to bond notes and RTGS would devalue some assets.

But the RBZ has since moved in to ring-fence pension values.

“We have assisted some of the pension firms in this country to purchase what we call deposit receipts in foreign currency so as to preserve the value for their funds for the pensioners, and that is at our expense, not their expense,” said Dr Mangudya at a breakfast meeting on Friday.

The issue of maintaining the value of pension funds is particularly relevant, especially after concerns were raised on how pension companies converted pension benefits from the Zimbabwe dollar to the United States dollar following the dollarisation of the economy in early 2009.

Numerous pensioners found their contributions eroded overnight, as pension companies claimed that savings had been wiped out by hyperinflation.

In his contribution at Friday’s meeting, economist Dr Gift Mugano noted that floating the US dollar would have adverse effects on savings.

“It is undeniable that the floating of the exchange rate will result in erosion of savings and pensions of the ordinary Zimbabweans. . .

“Consider one who deposited $100 000 US dollars eight years ago, and now bring in the (hypothetical) liberalised exchange of 1:4 into account, one will see that the real value of the $100 000 today is now US$25 000. The same observation applies to pensioners. This was again one of my reservations on floating.

“This experience, where economic agents have lost their pension twice in a 10-year period, will discourage savings, which are key for driving investment and economic growth,” said Dr Mugano.

While pensioners are being paid pittances, pension companies seem to be in good health.

According to an Insurance and Pensions Commission (IPEC) second-quarter report for last year, the pension industry had an asset base of $4,4 billion as at 30 June 2018, reflecting a 5,3 percent increase from the $4,2 billion reported as at 31 March 2018.

“The growth in the asset base was mainly a result of an increase in the value of quoted equities from $1,4 billion as at 31 March 20 18 to $1,6 billion as at 30 June 2018,” noted IPEC.

“The total assets translated to an industry average capital accumulation per member of $7,487 as at 30 June 2018.

“The average capital accumulation per member was 5,7 percent higher than the $7 081 per member reported as at 31 March 2018. The increase in the average capital accumulation was mainly due to the aforementioned increase in total assets.”

Meanwhile, IPEC is soon expected to announce a compensation framework to policyholders whose claims were eroded during the conversion of values from Zimbabwe dollar to the US dollars during the February 2009 period.

This is after a commission of inquiry into the conversion process found that pensioners and policy holders suffered a significant loss of value and recommended compensation.

It also noted that values were not only lost during the conversion period, but during the 1996-2014 period.

The commission’s investigations covered the 18-year period to 2014 and looked into the operations of life insurance companies, pension fund administrators, stand-alone pension funds, funeral assurance companies, the Guardians Fund, Government’s pension system and the National Social Security Authority.

The post RBZ ring-fences pension values appeared first on Zimbabwe Situation.

Source: RioZim’s $2,2bn project to take off | Sunday Mail (Business)

Golden Sibanda
Senior Business Reporter

RIOZIM has signed an exclusivity agreement with a Chinese state-owned firm Power China for the construction of a 2000-megawatt (MW) thermal power station in Sengwa, Gokwe North, raising expectations the long-standing plan is slowly coming to fruition, sources said last week.

An exclusivity agreement (or a lock-out, shut-out or no-shop agreement) is designed to ensure that the other party to a prospective deal negotiates solely with the client for a period of time.

The contractor is already on site, conducting initial evaluations which precede financial closure.

The first phase of the project involves the construction of a 700MW plant.

Sengwa, which carries a $2,2 billion price tag, is among several independent power projects that have been licensed by the regulator, the Zimbabwe Energy Regulatory Authority (Zera).

Although RioZim chief executive officer Mr Bheki Nkomo was not available for comment by the time of going to print, sources said Power China –  a sister company of Sinohydro, which was involved in the expansion project on Kariba South and is presently working on Hwange Power Station’s Unit 7 and 8 – is already preparing a bill of quantities.

“They (Power China) are on the ground now (Power China). They are doing a bill of quantities on the water pipeline and power lines. So, they are updating (details) on two issues, as required by financiers.

“The bank wanted to know the cost of the water pipeline from Kariba to Sengwa, so they are currently costing out that, then the cost of evacuation lines from Sengwa to Sherwood, they wanted proper costing,” said the source privy to the transaction.

“They also want the cost of building the town where workers at the power station will stay. We had also promised to deliver a Special Economic Zone, because we will require customers who will buy the power in forex.

“We want to obtain export processing zone at Sengwa. So, we have applied and the Office of the President is looking at it and on our partners. So things are moving well and we are very positive on the project,” added the source.

Upon completion, Sengwa will be among Zimbabwe’s two biggest power plants, including the 2 400 MW Batoka project that is being jointly pursued by Zambia and Zimbabwe.

Further, the envisaged thermal power project will be fed from RioZim’s coal claims, which are understood to hold more than 1,3 billion of the commodity.

Over the years, the company has been struggling to secure funds for the project.

But the pro-business administration of President Emmerson Mnangagwa has renewed investor interest.

RioZim recently shortlisted six prospective investors – among them Power China and US electrical systems behemoth General Electric (GE) – for the project.

The country has been shoring up its power supplies, and recently completed the 300MW Kariba South Hydro-power Station.

These projects, which have augmented supplies to the local power grid, have naturally cut the country’s import bill.

The country used to spend $40 million of scarce foreign currency to import power from Eskom of South Africa and Mozambique’s Hydro Cahora Bassa.

Separately, the Zimbabwe Stock Exchange-listed miner is currently working with a Japanese technical partner, Univergy, to build a 100MW solar power plant for its mines.

The post RioZim’s $2,2bn project to take off appeared first on Zimbabwe Situation.

Source: Battlefields: Escaping clutches of death | Sunday Mail

Debra Matabvu

They tried to glue their bodies to each other, struggling to maintain grip on the slippery rock that could barely support the eight desperate souls.

Their cold, stiff hands hung around each other’s necks with backs against the wall – literally and figuratively – of the illegal mine shaft as they battled for survival.

They were neck-deep in water that had smothered their colleagues minutes earlier. The labyrinthine pits of gold, which earlier promised fortune, now reeked of death.

For four days, eight men duelled with death in an epic fight that only had two possible outcomes: life or death.

“I think we have joined the league of the biblical Daniel, who was rescued from a ‘hole’ after days with no food and water,” recounted a visibly shaken Thinkmore Madimutsa, 24, who was the first survivor to be pulled out of the death pits at the collapsed mines in Kadoma.

Darwin – as he is known to his colleagues since he hails from Mount Darwin, Mashonaland Central – is one of the more than 50 gold panners that were trapped underground when Cricket and Silver Moon mines in Battlefields, Kadoma, were flooded on February 12.

Unfortunately, the incessant rains that were pounding the area had forced a nearby dam wall to give way, thereby opening the gates of hell.

On the fated day, at around 8pm, Thinkmore and 19 of his adventurous colleagues entered one of the shafts as per routine.

Another group of 12 fortune-seekers had gone in the shaft a few hours before them.

The artisanal miners wanted to make up for the time lost to the heavy downpour, which had prevented them from working during the day.

“Illegal gold miners can work anytime, so it was not unusual for us to go in at that time of the night. We wanted to cover up for the lost time,” he explained.

“However, whilst we were inside, it began to rain, triggering some small dams which are upstream to burst, causing a flash flood which entered the connected pits.

“Normally when there is danger, those on the surface warn colleagues underground to vacate the shafts. However, since it was during the night, no-one saw the water entering the pits, there was no warning.”

Oblivious of the danger that lurked in the darkness, they continued to work.

Due to the connectedness of the pits, the water stealthily began to fill underground before it spontaneously gushed toward the miners in one deathly wave.

“We were caught unaware. Fortunately, the small rock (near our working area) become our refuge.

“The other miners tried to escape, but they failed.

“The water kept on rising until we were neck-deep. We stood, backs against the wall, and pressed our bodies together.

“We stood for a long time,” he said.

For a moment, they thought that this was it: it was only a matter of time before rising water drowned them.

But by some stroke of luck, the water began to recede, giving the terrified miners time to relieve their legs – tired from supporting their weight – by sitting on the life-saving small rock.

Fatigue, tiredness and anxiety slowly took their toll and the miners became disoriented.

Added Darwin: “We did not know what day it was or the time of the day it was – time stood still.

“Although we would not talk for long hours due to exhaustion, hunger and cold, our conversations would revolve around if and when we going to be rescued.

“There was also one of us who had managed to keep his ‘loot’. We would mockingly ask him how and when he had collected it.

“Even when he was rescued, he never let the 10kgs out of his sight.

“Occasionally, we would also call the names of some of the colleagues we were with and their silence would confirm our worst fear.

“There was nothing to eat, so we filled our stomachs with the water in the shaft.

“I remember at one point we heard draining machines and we shouted for help. However, no-one heard us and after some time, there was silence.

“At that time, I thought they had given up.”

Unknown to him, the rescue team doggedly continued, but they had lost hope of finding survivors as minutes turned into hours, and hours turned into days.

Surreal

After what seemed to be an eternity, help eventually came.

It is was almost surreal and by then, the forsaken pits resembled a dirt-filled graveyard.

The bodies of some of the miners who had failed to make it were strewn near the place Thinkmore lay.

“I opened my eyes from a deep sleep; from a distance I could hear voices,” he went on.

“Around us were bodies of our colleagues who had died. A few meters away, was one of the dead bodies.

“I crawled to where it was – I was too weak to walk – softly removed the torch from the body and crawled towards the sounds.

“I could not shout, so I pulled the rope which we had used to enter the shaft days before.

“The pulling of a rope is a form of communication which is used by makorokoza; that moment they knew someone was alive.”

Suddenly, hope was restored.

Thinkmore’s four-day ordeal was over.

He was the first to be rescued amid jubilant and relieved relatives and friends.

Seven of his colleagues were hauled to the surface.

But 24 could not make it alive.

Relieved father

In that moment, Thinkmore’s father, Takaruza Madimutsa, was probably the happiest person on the planet.

“When I left Mt Darwin for Battlefields, relatives and friends had gathered at the family homestead for a funeral wake,” Thinkmore’s father said last week.

“We thought he was dead. We had no hope of finding him alive.

“When I saw him for the first time after the rescue, all I could do was to cry. No words could explain how I felt.”

He vowed to take him back with him to Mt Darwin.

“Since he left Mt Darwin in 2016, he has never returned. His mother wants to see him, that is the only way she will believe he is alive.

“Although we are a Christian family, there are rituals we need to perform. I pray he leaves this trade for good and find a better job.

“No sane person goes back underground after going through such an ordeal.”

Although Madimutsa’s ordeal seems over, a few meters away, water is being drawn in one of the mines shaft where four miners are believed to be still trapped.

Relatives of the four gather around the entrance of the shaft praying the miracle that saved Thinkmore and his colleagues is still deep down in those shafts.

“After the news of men who survived for days in a similar ordeal, we have hope that these four can be found alive,” said Thulani Fuzane from Zhombe.

As the sun begins to set at Battlefields, the battle for hope and survival continues.

 

The post Battlefields: Escaping clutches of death appeared first on Zimbabwe Situation.

President Emmerson Mnangagwa’s multi-party initiative for a national dialogue could soon reach a dead-end after three political parties withdrew citing lack of credibility among other reasons. Sources who were present during the closed door meetings said some of the political parties were beginning voice concerns over the direction the talks were taking. United Democratic Alliance (UDA)’s […]

Source: Reviving NRZ key to guaranteeing road quality: Matiza | Sunday Mail (Local News)

Sunday Mail Reporter

Nursing the National Railways of Zimbabwe (NRZ) to health will help guarantee the quality and durability of the country’s roads as it would help ease pressure on this overburdened mode of transport, a Cabinet Minister has said.

Addressing Government officials, local authorities and engineers in Masvingo during a tour of roads in the province last week, Transport and Infrastructure Development Minister Joel Biggie Matiza said an unreliable rail transport system has led to a disproportionate flow of traffic on local roads.

“As far as rail is concerned, there are lots of opportunities in rail. We have so many suitors coming in with so many programmes. Certain loads should not move on our roads because it’s detrimental, it damages the road, so we need the rail to take over,” said Minister Matiza.

“So we are seized with these issues in terms of upgrading our rail because it is fundamental; it is a backbone of our economy. Our roads are also backbones of the economy and they have to be taken care of.”

The exclusivity agreement between Government and DIDG/Transnet Consortium – which won tender to resuscitate the ailing national railway company – expired on February 14 this year.

Essentially, an exclusivity agreement tries to ensure that the other party to a prospective deal negotiates solely with the client for a period of time.

Minister Matiza says he will soon brief Cabinet on progress in the ongoing negotiations with the rail investors.

“We have been negotiating with an outfit called DIDG/ Transnet. We had an agreement which ended on the 14th of February, which gave them exclusivity to negotiate, to recapitalise the NRZ. The issue is that we want to recapitalise our rail system so that it becomes the best in the region.

“But, however, we still have certain things to address, and I am due to present a report to Cabinet on the outcome of this framework agreement – how far we have gone and the way forward. But the passion and the thrust is to have our rail network moving,” he said.

North-South Corridor

He also expressed satisfaction on current road works on the Harare-Masvingo-Beitbridge highway, which is a key arterial road for the North-South corridor.

Government is confident that the first phase of the major project – which involves expanding and rehabilitating the existing road up to 12-metres wide – will be completed within the set three-year timeline.

“We have started now with the 10-kilometre stretch from Chivhu. . . and also the 10 kilometres from Beatrice. We have already tendered for local engineers; in fact, it has already been done.

“We are also starting now to do the tendering for our local contractors into nine segments.

Masvingo province road engineer Peter Robert Mukome said there was need for more funding for roads in the province it had 13 percent of the country’s total network.

“Our provincial road infrastructure is the fulcrum of the transport system, keeping the population connected and the economy flowing. Furthermore, the network is in a strategic location of Southern Africa and is interconnected to Mozambique, through Sango Boarder Post; South Africa, through Crooks Corner, and Beitbridge Boarder Post. It also shares boundaries with four provinces,” he said.

“The province boasts some of the oldest roads within the country, with ridding quality ranging from fair to poor due to little or no maintenance for the past 20 years. Continued under investments in our roads infrastructure over the past years have, however, significantly reduced its quality,” he said.

 

The post Reviving NRZ key to guaranteeing road quality: Matiza appeared first on Zimbabwe Situation.