Zim News Blog -NEWS NETWORK

Source: Mthuli declares war on inflation | The Herald February 22, 2019

Prof Mthuli Ncube

Enacy Mapakame Business Reporter
Finance and Economic Development Minister Professor Mthuli Ncube says Government will continue to implement appropriate fiscal measures to bring inflation down to single-digit levels by year end.

Inflation, which erodes the value of currency, has a deleterious effect on the economy as it hinders pricing mechanisms, capital formation, stimulates speculative activities and hoarding and leads to misallocation of productive resources, something that has previously thrown Zimbabwe into turmoil.

But, the Treasury chief says Zimbabwe will institute measures to forestall the slide, after months of rising inflation.

The measures include reducing public expenditure and narrowing the trade deficit, which the Zimbabwe National Statistics Agency (Zimstats) said stood at $2,4 billion as at December 31, 2018.

Historically, inflation has sky-rocketed to record hyper-inflationary levels in Zimbabwe, attributable to fiscal indiscipline and a high trade deficit as imports outstripped export receipts.

Additionally, wasteful Government expenditure in particular created excess money supply, which triggered high demand for US dollars to pay for imports and store value, as inflation crept up.

In his weekly column in the The Herald newspaper, Minister Ncube said the fiscal consolidation measures were already bearing fruit, in the process helping balance up the budget.

The month-on-month inflation rate showed signs of a sustained decline last year, an indication of the positive effect of the measures being implemented by Government.

The minister said month-on-month inflation slowed down to 9,2 percent and 9,0 percent in November and December 2018, respectively, slightly increasing to 10,75 percent in January 2019.

“The policies of restructuring and reforming our economy are beginning to be felt with the month-on-month inflation expected to maintain downward trend from March 2019, a crucial marker of our economic stability and a direct result of these reforms.

“Things, therefore, are getting better. It is vital that economic agents, investors, consumers, and indeed policy makers focus their attention on month-on-month inflation developments rather than year-on-year,” said Minister Ncube.

Although year-on-year inflation has been on an upward trend since October 2018, reaching 56,9 percent by January 2019, Minister Ncube believes correct implementation of fiscal measures would reduce it significantly before year end.

The Treasury chief, however, acknowledged that the high inflation had a knock on effect on consumer spending as incomes were being eroded by the rising cost of goods and services.

He said this was downplaying their standards of living, but stressed that sustained implementation of the ongoing fiscal measures would bring a relief in the not so distant future.

Said Minister Ncube: “It has been eating away at our savings and our pensions, risking greater poverty. With inflation, long-term planning for companies becomes impossible as prices keep changing.

“In the same vein, fiscal forecasts become distorted in an inflationary environment. This is why as Minister of Finance; I have vowed to get inflation under control immediately. And we are already seeing results.”

Some of the fiscal measures being implemented include the 2 percent tax on electronic transactions, separation of nostro and RTGS accounts and reduced public expenditure.

Income generated from the intermediated money transfer tax will be used to improve social services such as building schools, roads and improving civil servants’ wages.

Minister Ncube emphasized the need for correct implementation of the fiscal and other economic reform measures to achieve the intended objectives of improving the state of the economy.

The finance minister also said that the implementation of the TSP was also expected to see Zimbabwe grow into an upper middle class economy by 2030.

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National Patriotic Front (NPF) spokesperson Jealousy Mawarire has said #ThisFlag activist and cleric Evan Mawarire was sponsored by the army to oppose former President Robert Mugabe. Speaking on Twitter on Mugabe’s 95th birthday on Thursday, Jealousy Mawarire said the army gave Pastor Evan protection and brought tickets for him and his family to go to […]

Source: Cabinet cancels six ZMDC tenders | The Herald February 22, 2019

Minister Mutsvangwa

Zvamaida Murwira Senior Reporter
Cabinet has approved the cancellation of six tenders for Zimbabwe Mining Development Corporation (ZMDC) subsidiaries aimed at reviving the entities after the bids failed to satisfy a review process, Information, Publicity and Broadcasting Services Minister Monica Mutsvangwa has said.

She said Cabinet had also approved the consolidation of ZMDC into specific mineral commodity groups, namely gold, precious metals, base metals and energy and industrial minerals and a specific subsidiary would be established for each of the mineral groups.

Minister Mutsvangwa said this while addressing journalists on Tuesday during a post-Cabinet media briefing.

She said her Finance and Economic Development counterpart Professor Mthuli Ncube had briefed Cabinet on progress made in the partial privatisation of ZMDC subsidiaries.

“In order to ensure an orderly privatisation process that will generate value for the investor and generate growth in the mining sector in fulfilment of Vision 2030, Cabinet approved the following, the discontinuation of the tendering process with respect to Elvington Gold Mine, Jena Gold mine, Lynx Graphite, Sandawana mines, Mbungu CBM and Gwayi CBM, which were viewed as not being satisfactory and that measures be taken to first enhance their attractiveness of the new tenders,” said Minister Mutsvangwa.

Responding to questions on why the tenders were cancelled, Mines and Mining Development Minister Winston Chitando said they failed to meet required standards.

“Firstly just to state that the tenders had not been awarded. The tender process had involved very thorough technical and financial review of the bids which were submitted. The process did not lead to award of tender. It was at the stage when it was realised that most of the bids were not really to the satisfaction of the review process. The whole idea is really not just to give the best bid but to ensure that we get the best value for the country,” said Minister Chitando.

“Just to give a little bit if perspective. You may be aware that some of the assets in question had no geological information. It is just really to say here is this mine come and bid, so you find that compromise the quality of the bids you get. The whole idea is to ensure that there is a process which ensures we unlock value from the full potential which those assets have.”

Turning to other entities, Minister Mutsvangwa said Cabinet noted with satisfaction the proposed roadmap that would ensure engagement of suitable investors to partner Government in Allied Timbers, a company she said was poised to become a blue chip company.

“Critical milestones on the roadmap include the following, ascertaining the true value of assets under Allied Timbers by urgently conducting independent valuations, regularising the lease agreement between the Forestry Commission and Allied Timbers, affirming by Government of its commitment to protect the gazetted forested land for forestry purposes only by addressing regulatory overlaps and discrepancies and addressing corporate governance issues to ensure stability at management levels at the helm of Allied Timbers,” said Minister Mutsvangwa.

Turning to Harare-Masvingo Beitbridge road projects, Minister Mutsvangwa said following the completion of ongoing work on detours on two sections to be worked by the Department of Roads, work on the rehabilitation of the Beatrice to Chivhu section of the Road was now set to begin this week while  rehabilitation of the Chivhu town section was due on March 1 2019.

“Tender evaluation reports with respect to the remaining nine section of the Beitbridge-Harare highway had already been submitted to the Procurement Regulatory Authority of Zimbabwe following which tenders would be awarded,” said Minister Mutsvangwa.

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Source: Congress date divides MDC – NewsDay Zimbabwe February 22, 2019

BY RICHARD CHIDZA

THE opposition MDC led by Nelson Chamisa is likely to hold its congress in October after a national standing committee meeting held on Wednesday failed to come up with a date, NewsDay has learnt.

Sources who attended the meeting said there were heated exchanges during the meeting over the interpretation of the party’s constitution.

But Chamisa told his lieutenants that he would have the final word.

Chamisa reportedly clashed with party secretary-general, Douglas Mwonzora after the latter recused himself from indicating which date he preferred congress to be held.

“It was a heated meeting. Chamisa asked everyone to give a date on which the congress should be held, but Mwonzora refused probably feeling he had been waylaid. Chamisa probably wanted to gauge his adversaries’ preparedness and was angered by Mwonzora’s response,” a source said.

“He (Chamisa) was not amused. He accused Mwonzora of ‘trying to be clever and half’. Chamisa’s supporters in the meeting preferred August while others want it in October. In the end, there was no consensus and Chamisa said he would have the final
say.”

Chamisa controversially rose to power last February railroading the party’s national council into endorsing him as successor after founding leader, Morgan Tsvangirai passed away in South Africa.

Tsvangirai’s death triggered an internal power struggle that resulted in then co-vice-president Thokozani Khupe breaking away, while another vice-president, Elias Mudzuri and Mwonzora stayed on. They are reportedly plotting to challenge Chamisa at congress.

Another source, however, said Chamisa had given everyone a chance to give their interpretation of the constitutional provisions.

“Chamisa asked everyone to read the constitution and give their interpretation of when the congress should be held. Our constitution says congress must be held every five years, but a special congress can be held in the event of a vacancy in the office of the president before his or her term expires.

“While we all know that Chamisa was endorsed by the national council to take over as substantive leader, it is important to note that it would be unhygienic to hold an extra-ordinary congress in the same year as a congress proper,” NewsDay heard.

“The president is actually right. He could call for an extra-ordinary congress today, get elected and then refuse to have his position contested in October. The fifth year for us began in November last year and anytime from then we could have held our congress. It’s just a matter of logistics.”

Party spokesperson Jacob Mafume confirmed that the standing committee discussed the issue of political dialogue, congress and the situation in the country.

“It was an open meeting in which people were allowed to air their views regarding congress. While we do not have a specific date yet, most agreed that we will have it in October. What is left are logistics and, in any case, our structures will have to begin this process soon,” Mafume said.

Mwonzora refused to comment on the claims of an altercation between him and Chamisa.

“The national standing committee is a private meeting whose discussions are the preserve of members of the party,” he said.

The post Congress date divides MDC – NewsDay Zimbabwe appeared first on Zimbabwe Situation.

Source: NetOne board speaks on Muchenje return | The Herald February 22, 2019

Mr Lazarus Muchenje

Africa Moyo Senior Business Reporter
NETONE Cellular board chairman James Mutizwa says the company is pleased that a solution regarding the status of chief executive officer, Lazarus Muchenje, has been found, and is expecting him to continue the turnaround efforts that saw the parastatal recording its first month-on-month profit during his reign.

Mr Muchenje, who was suspended in August last year for alleged “gross misconduct” relating to how he handled expired contracts for nine senior managers, has since bounced back at the State-owned enterprise.

Mr Mutizwa told The Herald Business on Wednesday that they are now hoping that the conclusion of Mr Muchenje’s issue brings smiles to the company, and are now hoping that he will continue to steer the company to profitability.

“We are delighted at NetOne to have brought closure to the CEO matter that had subsisted over the past seven months.

“The expectation from the board is that NetOne will continue with its positive trajectory and should provide a return to the shareholder,” said Mr Mutizwa

The decision to bring him back was made by the recently appointed five-member board. It is unclear what the board considered before settling on bringing back Mr Muchenje. Apart from prominent lawyer Mr Mutizwa, the new NetOne board also consists of Miss Susan Muchaneta Mutangadura, the deputy chairperson; Mr Winston Makamure; Mr Mathias Rangarirai Mavhunga and Mr Paradzai Mutandwa Chakona.

Mr Muchenje is famed for dragging NetOne out of the mud in 2018, turning it into a profit-making enterprise. NetOne declared its first month-on-month profit last year.

NetOne is yet to release its financial results for the year 2018. However, the business recorded a loss of $57,8 million for the year ended December 31, 2017, which was largely attributed to legacy issues that weighed down the company’s performance.

After assuming leadership of NetOne last year, Mr Muchenje started an aggressive approach to increase revenue through a network expansion drive and cost containment measures.

The actions resulted in NetOne’s mobile financial arm, OneMoney, increasing its active subscriber base, backed by increased network coverage throughout the country.

In line with its mission that speaks to transforming lives and developing communities through communication solutions, NetOne commissioned several base stations in previously marginalised areas and embarked on aggressive corporate social responsibility initiatives.

Mr Muchenje, seen by technology experts as a turnaround strategist, is famed for dragging NetOne out of the woods in 2018.

He transformed the enterprise from being a loss-making firm to a profitable after declaring its first month-on-month profit during the year.

He is a chartered accountant by profession who has previously held the positions of group CEO at Intarget Group, FirstRand Bank Celpay International BV; executive head of sales (Vodacom SA); head of wireless application, sales and marketing director (Vodacom DRC) and founding finance director (Vodacom DRC).

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