Zim News Blog -NEWS NETWORK

President Emmerson Mnangagwa’s penchant for travelling in state-of-the-art airplanes has come at a huge cost to the taxpayer, thus undermining his government’s ‘austerity for prosperity’ mantra. Since coming to power in November 2017, Mnangagwa has travelled over 25 trips. In nearly 16 months, he has been to countries such as Russia, Rwanda, Belarus, Guinea, Azerbaijan, Kazakhstan, South

Source: RBZ allays fears on bank balances | Sunday News (local news)

Peter Matika, Senior Reporter
BANK balances for both RTGS dollars and FCA Nostros will remain the same and the Reserve Bank of Zimbabwe will not raid anyone’s foreign currency account, the Governor, Dr John Mangudya has said.

Last year the RBZ advised banks to separate foreign currency accounts and RTGS money. Under the stewardship of former Governor Dr Gideon Gono, the RBZ was accused of raiding foreign currency from exporters’ accounts, but Dr Mangudya has assured account holders that all forms of money were safe in the bank, adding that there would be no changes in bank balances despite the recently announced changes through the monetary policy.

“We have never raided anyone’s nostro account, our records can testify and we will not do so going forward,” he said at a breakfast meeting in Harare to discuss the monetary policy he delivered last week.

The breakfast meeting was attended by Finance and Economic Development Minister Prof Mthuli Ncube and captains of industry.

He said although banks agreed to start trading the RTGS dollars as $2,50 to US$1, going forward the rate will be determined on a daily basis by market forces.

“The bank rate will determine the rate on the market. We will arrange foreign lines of credit since demand will be greater than the supply of foreign currency. We need to cloud seed the market with foreign currency,” he said.

Dr Mangudya added that this would also pose an opportunity for foreign currency traders to set up formal bureau de change companies.

“For the foreign currency dealer this is your opportunity to open formal bureau de changes and trade formally. We only have one Zimbabwe and should work together. The parallel market (street) rate is way too high because there is a risk premium, you can go to jail for 10 years. We delayed presenting the monetary policy because we wanted to analyse all submissions from all sectors of the economy so that we speak to everyone, nothing else. Bulk of money in Zimbabwe is seating on the RTGS platform. We only have $437 million of bond notes,” he said.

Dr Mangudya said the implementation of the bond note was necessitated to formalise the export incentive.

“The percent incentive scheme was a shadow exchange rate. It went on well when inflation was below five percent. When the inflation went beyond 20 percent in October the 1:1 exchange became unsustainable,” said Dr Mangudya.

Economists have said the market has received the measures announced by the central bank in a positive way despite fears people had that the policy was likely to cause tremours on the market.

“This is a positive start, people feared after the announcement that prices would go up and there will be chaos in the market. The market has embraced the changes and even retailers have not increased prices,” said an economist with a banking institution. He said the move also gave the RBZ some air to breathe on monetary matters.

“When we were exclusively using foreign currency, the bank was constrained in controlling money matters because it had no control over money supply. With the RTGS dollars there is some way of negotiating the matter although the ultimate solution lies in introducing our own currency which obviously has to be backed by output.”

The RTGS dollars will also help Government to control its spending. Finance Minister Prof Ncube has already indicated that the Government was now standing on a cash position since it can also harness plastic money. The Government paid its January and February salaries standing on cash position, he added.

Economists say a cash position represents the amount of cash that a company, investment fund or bank has on its books at a specific point in time. The cash position is a sign of financial strength and liquidity.

“Fiscal consolidation measures are already helping to balance the budget. On the other hand, the income from two percent tax (on electronic transfers) will also be used to rejuvenate and improve the new Zimbabwe; building schools, roads and making sure our nurses, doctors and teachers receive the wages they deserve. We can already see that shelves are full and fuel lines have petered out.”

He added that the ministry will undertake a global deal road show in different countries to explain the country’s economic situation in June or July.

“We will be in Frankfurt and Tokyo. We expect to sign deals that will benefit the country’s economic performance.”

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Source: 77 percent exhibition space taken at ZITF | Sunday News (Business)

Thandeka Matebesi, Business Reporter
AT least 77 percent of exhibition space has been taken up by exhibitors for this year’s Zimbabwe International Trade Fair, a slight increase from the 71 percent that had been sold at the same time last year.

This year’s exhibition takes place from 23 to 27 April at the Zimbabwe International Exhibition Centre in Bulawayo, under the theme, “Propagating Industrial Growth through Trade and Investment”.

This year’s exhibition is the 60th consecutive edition of the show. ZITF Company marketing and public relations manager Miss Stella Nkomo said bookings were still in progress.

“To date 77 percent of the available space has been taken up by a total of 236 direct exhibitors. This compares favourably with the booking situation at the same time last year, where 71 percent of the available space had been taken up by 206 exhibitors. A total of 49 631 square metres of space has been made available for sale including five exhibition halls, over 120 individual pavilions and over 10 000 sq metres of external or open sites.

“Enquiries and bookings continue to come through on a daily basis and projections are that the show will be successful and well-represented in terms of both local and international participation,” she said.

She also said at least four countries had confirmed their participation in this year’s show.

“Interests on the international front have been high with four countries having confirmed participation namely, Ethiopia, Japan, Malawi and Mozambique,” said Miss Nkomo.

Miss Nkomo said they had already engaged players in the tourism and hospitality industry through their respective bodies to ensure adequate and affordable accommodation for tourists.

“Because of the high level of interest in the show, organisers anticipate an increased demand for accommodation services during ZITF 2019. Consequently, ZITF has already engaged local accommodation operators individually and through apex bodies such as the Zimbabwe Tourism Authority to discuss issues of availability, pricing and customer service.

“The industry has given assurances that it is equal to the task through the hotels, lodges, guest houses and private homes dotted throughout the city. As a value-add to participants at this year’s show, ZITF has retained the service of its strategic partner Ecological Safaris to assist exhibitors in finding suitable accommodation.”

She said her company has also come up with packages as part of their efforts to profile Bulawayo as a preferred business tourism destination.

“Additionally, ZITF is in discussions with local tour operators to come up with tailored tour packages that will provide visitors with a rounded experience of not just the exhibition but of the host city, Bulawayo. This is in line with international trade exhibition trends and is part of ZITF’s greater strategy,” said Miss Nkomo.

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Source: Retailers, Government work on regulating tuckshops | Sunday News (Business)

Thandeka Matebesi, Business Reporter
The Confederation of Zimbabwe Retailers (CZR) is working with the Government to come up with ways of regulating tuckshops amid concerns that they are largely operating outside the formal taxing system.

CZR president Mr Denford Mutashu said while tuckshops were an opportunity which must be explored there was a need to craft legislation governing their licensing and existence.

“What we are basically doing is to try and get the tuckshops regularised and I am aware that the Ministry of Women Affairs, Community, Small and Medium Enterprises and the Ministry of Industry and Commerce are collaborating to ensure that the issue receives the attention that it deserves.

“It’s an innovative way of helping the community that must actually then be supported and this is the reason why currently we are working with authorities to find a way of regularising tuckshops. It is important to know that there is no provision to issue licensing to tuckshops which is a negation because it affects the operational modalities because time and again we have seen council officials and many other law enforcement agencies coming to them and interrupting their businesses,” said Mr Mutashu.

He said the matter was receiving urgent attention from both the Government and the retailers.

“We are moving with speed and the Government has also acknowledged that it needs to move with speed in dealing with the issue of tuckshops. There are many issues surrounding the emergence of tuckshops.

One of the issues is that the area may have been under-serviced by the formal players and yet the communities at that particular juncture will be forced to travel long distances to the nearest shopping centre,” said Mr Mutashu.

“Therefore, if a tuckshop is opened in the residential area, it is of course an opportunity that one may have realised from that locality that they can bring goods closer to the people than having to travel longer distances to access goods.”

Mr Mutashu said however, some tuckshop operators were also involved in the smuggling of goods.

Meanwhile, CZR is working on setting up distribution centres in smaller towns as a way of containing costs associated with transport.

“We had tabled plans to set up distribution centres in small towns. What we then did was to encourage penetration of big and small players in the retail and whole sector especially in marginalised areas. Even the expansion strategies of many of these players, are now focusing on those areas that previously would be deemed unattractive.

It is our fervent hope that, despite the economic challenges especially in the southern parts of the country after the disturbances that were witnessed, players will still be able to continue with their expansion drive that they had put together,” he said.

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Source: NRZ passenger services up 300 percent | Sunday News (Business)

Leonard Ncube, Victoria Falls Reporter
THE National Railways of Zimbabwe has seen passenger volumes rising by 300 percent since the beginning of the year as more people turn to cheap rail transport due to high cost of travelling by road.

NRZ operates three daily and two weekly inter-city passenger train services countrywide. The daily train return routes are Bulawayo-Victoria Falls, Bulawayo-Harare, Mutare-Harare while the weekly service is offered on the Bulawayo-Chiredzi and Bulawayo-Chikwalakwala routes.

NRZ public relations manager Mr Nyasha Maravanyika said the Bulawayo-Victoria Falls and Harare-Mutare were the company’s cash cow.

“Passenger volumes have generally increased by between 274 and 373 percent per week on our inter-city routes. Southern region volumes have gone up to 10 000 which is a 373 percent increase while the Eastern region volumes went up to 5 000 passengers which is a 274 percent increase. In the Midlands region there is a 275 percent increase to 943 passengers per week,” said Mr Maravanyika.

Southern region covers Matabeleland North, Matabeleland South and Bulawayo while the eastern region covers Harare, Manicaland and Mashonaland provinces. Midlands caters for Midlands and Masvingo provinces.

Mr Maravanyika said the Bulawayo-Victoria Falls and Harare-Mutare trains have nine coaches each on average per trip while other routes have six each. Each coach has a sitting capacity of 100 passengers.

“We have been overwhelmed by numbers since the festive season when road transporters started increasing fares. Passengers have been requesting that we add more coaches especially on the Bulawayo-Harare route. The Bulawayo-Harare route is supposed to be our flagship in terms of numbers but it’s not yet there,” he said.

A ticket between Bulawayo and Victoria Falls or Bulawayo and Harare costs $9, compared to between $35 and $60 charged by road transporters.

Mr Maravanyika said while numbers are picking up between Bulawayo and Harare, the train service was facing challenges due to vandalism of the infrastructure between Harare and Gweru. The stretch used to be electrified but was destroyed by thieves who stole copper cables and illegal panners who mine along the railway.

As a result the train moves slowly between Gweru and Harare. Mr Maravanyika bemoaned the extent of vandalism of the track especially in Kwekwe, Shurugwi, Munyati and Bindura, where signals equipment was also destroyed.

He said NRZ was pinning its hopes on closure of the $400 million recapitalisation deal signed with Diaspora Infrastructure Development Group (DIDG)/ Transnet to refurbish and in some cases overhaul locomotives, coaches and the railway line.

@ncubeleon

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