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Zim elections set for July 30

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MDC -T President Nelson Chamisa and President Emmerson Mnangagwa

ZIMBABWE will hold its much anticipated general elections on July 30, 2018, government announced yesterday.
In a proclamation made through Statutory Instrument (SI) 83 of 2018, President Emmerson Mnangagwa also set the runoff election date for September 8, 2018 if none of the presidential candidates achieve the 50 percent plus one poll result threshold set out in the Constitution.
Mnangagwa, who will represent the ruling ZANU-PF in the presidential elections, and MDC-T president Nelson Chamisa are front-runners in the race to lead the country, although several fringe political parties will be fielding candidates during the first polls to be held since a “soft coup” triggered the ouster of long time ruler Robert Mugabe in November.
State media reported yesterday that Mnangagwa had a strong chance of winning the elections, citing a survey by the Pan African Forum that projected the president would garner 70 percent of the votes, ahead of Chamisa’s 24 percent.

Read full story in The Financial Gazette paper

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High govt wage bill to choke economy

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Finance Minister, Patrick Chinamasa

ZIMBABWE’S faltering economy could suffer serious fresh shocks, with civil service salaries threatening to hit a staggering 120 percent of national budget and thus endangering critical social services, including hospital drug supplies and infrastructure reform programmes.
This comes as Harare’s first quarter trade deficit hit $1 billion while the public-sector wage bill continues to skyrocket, with President Emmerson Mnangagwa’s government making unbudgeted for, election-related salary concessions to the country’s restless civil servants.

Read full story in The Financial Gazette paper

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Parliament wants Intratrek’s Gwanda solar project contract cancelled

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Businessman, Wicknell Chivayo

A parliamentary committee has recommended that the $202 million Gwanda Solar Project tender, which was awarded to controversial firm Intratrek Zimbabwe in 2015, be immediately withdrawn and that former ministers be prosecuted if they flouted tender procedures in awarding the contract.

The Mines and Energy Portfolio committee also wants the boards of ZESA Holdings and the Zimbabwe Power Company to be dismissed for failing to follow good corporate governance practices in awarding the contract.

“The money paid to Intratek should be recovered after investigations are  completed and the award (of the tender) to Intratek needs to be rescinded in light of violations of the Company’s Act and the (now) repealed Procurement Act,” committee chairperson Temba Mliswa said in a report tabled in the National Assembly on Thursday.

“Ministers and deputy ministers named in the corrupt activities at the Gwanda Solar Project should be investigated and prosecuted, and the Zimbabwe Anti Corruption Commission and the Zimbabwe Republic Police should conduct an investigation on the ministers implicated in the scandal.”

Samuel Undenge, Dzikamai Mavhaire, Elton Mangoma and former deputy minister Munashe Mutezo that were said to be complicit in the deal.

Intratrek Zimbabwe is fronted by the flamboyant businessman, Wicknell Chivayo.

The Gwanda 100MW solar project is yet to take off and in February this year, ZPC told the committee that it had extended the contract for completion of pre-commencement works by six months until April 23 this year after the initial two year period had expired.

A visit to the site by the committee early this found two temporary shacks having been erected with no other work going on, despite Intratrek receiving $5, 6 million in unsecured advance payment.

The payment was purportedly for preparatory work on the solar plant, one of several power contracts that Intratrek was awarded by the government between 2015 and 2016, including the $73 million refurbishment of Harare power station; a $163 million project to restore Munyati power station; a new $128 million hydropower station at Gairezi.

“The committee was informed that the (ZPC) managing director Noah Gwariro acted without consulting the board because of pressure from politicians that included former ministers of energy, Mavhaire, Mangoma, Undenge and Mutezo. However, Mutezo appeared before the committee and denied the allegations,” said Mliswa.

The said they found that Undenge communicated directly with the board to influence payments to Chivayo.

“It was clear that Undenge used to have direct communication with ZPC management and was the one said to have instructed the ZPC board to make payments to Chivayo without (Chivayo) having to provide a bank guarantee,” said Mliswa. – The Source

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World Bank bearish on Zimbabwe’s growth

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The World Bank headquarters.

THE World Bank sees Zimbabwe’s growth rate easing to 2,7 percent this year, compared to the 3,4 percent estimated last year. The forecast is higher compared to the 1,8 percent projected in January by the bank.
However, government says the economy grew by 3,7 percent last year and is estimating a 4,5 percent growth rate this year.
In its Global Economic Prospects report released on Tuesday, the World Bank also forecasts a 3,8 percent growth for Zimbabwe next year, which is 0,2 percent higher compared to its January estimate. According to the Bank, Zimbabwe will grow by four percent in 2020, which is higher than the 3,8 percent initially projected in January.
The report observed that in some fragile countries such as Zimbabwe, political transitions will allow for a pick-up in economic activity, as opportunities for reforms boost investor sentiment.

Read full story in The Financial Gazette paper

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Foreign direct investment drops 22 percent

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Finance Minister Patrick Chinamasa and the Reserve Bank of Zimbabwe governor, John Mangudya

ZIMBABWE’S foreign direct investment (FDI) inflows retreated 48,6 percent from $372 million in 2016 to $289 million last year, a World Investment Report released yesterday by the United Nations Conference on Trade and Development (UNCTAD) shows. 
According to the report, investment outflows from Zimbabwe also rose 44,8 percent to $42 million compared to $29 million in the prior year, largely due to the uncertain political environment which was prevailing during the time.
“FDI declined in Mali, Swaziland and Zimbabwe, where political uncertainty dampened investment prospects,” said the report which, however, noted that some noteworthy investment liberalisation measures have been undertaken in Zimbabwe.

Read full story in The Financial Gazette paper

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State takes $500m fresh debt

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President Emmerson Mnangagwa

GOVERNEMNT has officially added about $500 million to its colossal debt profile after President Emmerson Mnangagwa last week signed a law granting his administration permission to take over the troubled ZISCO Steel debt.
It means the State assumed an additional $494,8 million in various commitment that ZISCO had failed to pay when it collapsed about a decade ago, and was seen as one of the handicaps to its efforts to find a suitor.

Read full story in The Financial Gazette paper

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OK Zimbabwe crowned top company

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OK Zimbabwe operates 62 outlets in the country.

RETAIL chain OK Zimbabwe was crowned this year’s best performing company on the Zimbabwe Stock Exchange (ZSE) at The Financial Gazette’s Top Companies Survey, which is bankrolled by financial services giant Old Mutual Zimbabwe.
OK Zimbabwe, which has 62 outlets operated free of debt during the year ended March 2018, had record-breaking revenues that boosted company coffers.
Internally generated funds were said to be adequate for working capital and expenditure requirements.
Capital expenditure for the year was $15,5 million, up from $10,9 million in prior year.
Revenue grew 23,4 percent to $582,9 million, a record for the company.
A profit after tax of $16,6 million represented a 174,6 percent increase from the previous period.
Beverage processor Delta Corporation was the first runner-up at the Top Companies Survey Awards.
Last year the company was crowned the best performing company on the ZSE.
Padenga Holdings, which produces and sells crocodile skins and meat, was crowned second runner-up for the second year running.
The winner and runner-up recipients excelled in the areas of earnings quality, size, efficiency and financial health.
They also demonstrated outstanding qualitative attributes in the areas of corporate governance, environmental sustainability, disclosure and investor relations as well as social responsibility programmes.
Ecobank, a pan-African banking conglomerate with operations in 36 countries, was voted the best bank with Standard Chartered Bank Zimbabwe taking the runner-up position.
Standard Chartered Bank, a multinational banking and financial services company, was crowned the best bank last year.
Nyaradzo Life Assurance was crowned the Best Life Assurer. Zimnat Life Assurance Company was the runner-up.
The Life Assurance Award recognises the best performing life assurance company, which excelled in five weighted categories within the life assurance sector. This is capital adequacy, operating performance, liquidity, competitiveness and size over a three-year period.
Zimnat General Insurance was voted the best short term insurer, while FBC Insurance was the runner-up.
Delta Corporation won the Disclosure and Investor Relations Award.
This award acknowledges a company that makes disclosures, whether beneficial or detrimental to the company, as well as reasonable levels of engagement with all stakeholders, particularly the investment community.
The disclosure of information should be made in a timely manner and in simplified financial language.
SeedCo won the Special Mention Award, an honour that goes to a company that has demonstrated progress in the creation of shareholder value.
The winner of this year’s award was recognised for forging partnerships that paid off and seeking presence and competitiveness on a global scale, in line with the theme of this year’s Top Companies Survey: Positioning for global capital.
Padenga Holdings Limited won the Best Tangible Investor Returns Award.
This award recognises, quantitatively, the best performing company in terms of return to investors or shareholders.
The main sources of return for investing on the stock market are capital appreciation and dividend yield.
This award recognises consistency and incremental growth of the company’s share price over a three year period, sequentially weighting the returns, with 2017 carrying the greatest weight.
Speaking at the event, chairman of the panel of judges and analysts, Welcome Mavingire, said this year’s Top Companies Survey comes amid renewed optimism and hope for a sustainable recovery in Zimbabwe’s economy.
He said this was a marked departure from prior years when judges were primarily focused on which companies were better placed to survive the “toxic economic environment.”
“Generally, the judges consider a top company as one that should  be able to not only withstand a difficult economic environment but also prosper during an economic recovery phase,” Mavingire said.
“And this speaks to not only its business model but also management capabilities, agility and general governance issues around the company,” said.
Guest of honour, Kevin Wakeford said the time for economic development in Zimbabwe was now.
“Zimbabwe has been a net exporter of enterprising educated individuals who are contributing growth in other countries. They are important for development of this country going forward. My view is you can do it, you just need to get the basics right again,” he said.
The Financial Gazette’s managing director, Pilate Machadu, said the aim of the survey is to promote good corporate governance practices, ethical conduct and corporate social responsibility.
newsdesk@fingaz.co.zw

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‘Brace for more price increases’

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According to RBZ governor John Mangudya, the country spends 40 percent of its foreign currency earnings on fuel imports, with diesel taking a lion’s share of $851,7 million, while $384 million is spent on petrol imports, giving a total of $1,2 billion per year.

PEAKING at $1,47 per litre for petrol, fuel price increases are anticipated to have a ripple effect and lead to price jumps in essential consumer goods, denting Zimbabwe’s economic growth prospects, experts have warned.
Price rises at the pump follow a huge jump in oil prices over the past year after Brent Crude broke through the $80 a barrel mark in May for the first time in nearly four years, prompting industry apprehension on price increases.
Oil peaked at around $120 a barrel in 2014 but soon after dropped to as low as $40, with local diesel prices presently are an average of $1,32, up from $1,21 a week ago.

Read full story in The Financial Gazette paper

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Mnangagwa ‘trips’ self on FDI

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President Emmerson Mnangagwa

PRESIDENT Emmerson Mnangagwa and the ruling Zanu-PF have contradicted each other on the country’s investment figures, with the former saying Zimbabwe has attracted a hefty $16 billion in fresh capital against $3 billion stated in the party’s election manifesto.

The development also comes as debate is raging on the calibre of some of the “benchmark investors” being trumpeted by the new Harare administration and the Zimbabwean leader himself has insisted that gestation periods of these projects are longer. Additionally, economic recovery will not be an overnight event, he said.

“…the people`s aspirations will be fulfilled in a new environment where Zimbabwe is open for business in order to maximise on the emerging international goodwill and confidence as shown by the more than $3 billion foreign direct investment within three months of President Mnangagwa ascending..,” part of Zanu PF’s poll document – launched on May 04 – says against Mnangagwa’s recent pronouncements that the country had garnered $16 billion within six months.

Read full story in The Financial Gazette paper

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We are fighting obesity, says Coca-Cola

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We are fighting obesity, says Coca-Cola

[caption id="attachment_165932" align="alignnone" width="300"] We are fighting obesity, says Coca-Cola after social media backlash over new Mazoe taste[/caption] The Coca-Cola Company of Zimbabwe says its new product line of low sugar cordials is aimed at helping combat obesity after a customer backlash on social media about the unfamiliar taste. The global beverage maker recently introduced the new cordials which it says have up to 60 percent lower calories than the previous offerings. “The Coca-Cola Company has taken a global decision to do more when it comes to the issue of obesity. Around the world, eating and drinking less sugar is an increasingly important issue for many people. Sugar in both foods and beverages can be part of a balanced lifestyle…

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Yes, 72 percent of Zimbabweans are living in poverty

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Yes, 72 percent of Zimbabweans are living in poverty

[caption id="attachment_151377" align="alignnone" width="300"] President Emmerson Mnangagwa[/caption] ZIMBABWE has been in economic decline since the late 1990s. In this economy, how many Zimbabweans live under the poverty datum line? A claim was made by opposition political party Build Zimbabwe Alliance, which ZimFact went out to fact check. Claim: 38 years after independence, 72% of people still live under the poverty datum line. The World Bank defines extreme poverty as living on less than US$1.90 per day as of October 2015. Prior to that, the global line was $1.25 a day. It was projected that in 2015, just over 700 million people were living in extreme poverty down from 1.9 billion in 1990 when the poverty line was initially set at…

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Zimbabwe warned on civil service pay

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Zimbabwe warned on civil service pay

[caption id="attachment_162847" align="alignnone" width="300"] Zimbabwe has over the years continued to overspend, with last year’s deficit outturn standing at $1,7 billion, representing 9,4 percent of gross domestic product (GDP).[/caption] THE International Monetary Fund has warned government over civil service salary increases, citing fiscal consolidation challenges amid a widening budget deficit. Fiscal deficits have continued to haunt government with authorities targeting a $672 million deficit. This could, however, widen following recent hikes in civil servants salaries. “Fiscal consolidation is a critical element for stabilising the economy, since persistent large deficits crowd out private sector investment, exacerbate external imbalances, and further undermine confidence in the currency regime. “Given the tight fiscal space, it is important to prioritise and rationalise all spending, ensuring…

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ZSE adds another billion

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ZSE adds another billion

[caption id="attachment_75764" align="alignnone" width="300"] Since the resumption of the market’s bullrun mid-March, the benchmark All Share index has gained 37,76 percent to close yesterday at 118,69 points.[/caption] THE Zimbabwe Stock Exchange (ZSE) has continued its rally that has been spurred by the monetary crisis in the country, with the market capitalisation pushing over $11 billon this week. The market capitalisation which closed yesterday at $11,3 billion, has now gained more than $1 billion since a little over three weeks ago when it reached $10 billion for the first time this year. The local bourse’s recent rally has been a recovery after a slump that was triggered by the euphoria that gripped the market in November last year when Robert Mugabe…

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Gumbo in fresh controversy

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Gumbo in fresh controversy

[caption id="attachment_81915" align="alignnone" width="300"] Transport Minister, Joram Gumbo.[/caption] TRANSPORT minister Joram Gumbo might have “violated procedure” by handing over a Grant Thornton forensic audit on the Zimbabwe National Roads Administration (ZINARA) to a five-man committee, which essentially used the same report to make its findings. This also comes amid revelations that the parastatal’s board was under pressure to axe two senior managers, who were allegedly responsible for costing the State-owned enterprise about $80 million through irregular deals and procurements. “You will be aware that Grant Thornton was hired to look into ZINARA’s operations from 2011 to about 2016 and which voluminous report was supposed to be handed over to the Auditor-General (AG)’s office. But after it was published, Gumbo moved…

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Deported British investor speaks out

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Deported British investor speaks out

[caption id="attachment_49223" align="alignnone" width="300"] Home Affairs Minister, Obert Mpofu[/caption] A BRITISH citizen Kenneth Vincent Grant-Coker, who was deported a fortnight ago for overstaying in the country, has written to Home Affairs Minister Obert Mpofu accusing the Immigration department of “corruption and lack of professionalism”. Grant-Coker, who claims that he wanted to bring investment totalling $100 billion into Zimbabwe, said he was hounded out of the country like a criminal because he refused to pay bribes to immigration officers. “It is clear that if you do not pay immigration their ‘pound of flesh’ you will end up in remand with no recourse to your legal rights. I tried to do the right thing, I could have got my passport stamped at…

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New board to chew more tax

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New board to chew more tax

[caption id="attachment_162307" align="alignnone" width="300"] Finance Minister, Patrick Chinamasa[/caption] ZIMBABWE is to establish a new board to facilitate economic discussions between business, labour and government. The Tripartite Negotiating Forum (TNF), a platform that business, labour and government have been using to discuss issues affecting the economy, is to be transformed into a fully fledged body corporate to facilitate meetings. This is according to the TNF Bill 2018, which was gazetted last week. It says TNF will now have a full secretariat presided over by an executive director and a chairperson, and will draw financial resources from the Treasury. If Parliament gives the nod to the TNF Act, it will add to over 100 mostly derelict State firms and agencies that have…

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Falling SA rand hammers ailing Zimbabwe

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Falling SA rand hammers ailing Zimbabwe

[caption id="attachment_166643" align="alignnone" width="300"] A weakening rand affect the competitiveness of local products in SA, as Zimbabwean exports would be more expensive than goods coming from the other end.[/caption] THE alarming fall of the South African rand against major currencies — over the past few months — is likely to hit Zimbabwe’s ailing economy hard. Although Harare continues to resist local industry’s impassioned pleas to adopt Pretoria’s medium of exchange as the country’s primary currency, its performance has always had a bearing on the local economy as well as region. The rand fell to a fresh six-month low against the American dollar — at R13-plus last Friday and at the end of another bruising week for South Africa (SA)’s stuttering…

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Govt promises to stop land evictions

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Govt promises to stop land evictions

[caption id="attachment_155428" align="alignnone" width="300"] Lands, Agriculture and Rural Resettlement Minister Perrance Shiri[/caption] GOVERNMENT will be stopping all land evictions, especially the appropriation of indigenously owned farms and those farms protected under Bilateral Investment Protection and Promotion Agreements (BIPPAs). Government is currently saddled with a $32 million debt owed to 13 Dutch farmers led by Bernardus Henricus Funnekotter, including a $240 million arbitral award to a family of Swiss-German investors, the von Pezold family. Their company, Border Timbers, also won twin awards against the Zimbabwean government at the International Centre for Settlement of Investment Disputes in 2015. “The law is very clear. Where indigenously owned or BIPPA farms or any other farm has been acquired by government, government is obliged to…

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Zimbabwe’s May inflation flat at 2,71 percent

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Zimbabwe’s May inflation flat at 2,71 percent

ZIMBABWE’S consumer price inflation remained flat at 2,71 percent on an annualised basis in May according to the national  statistics agency. The month-on-month inflation rate shed 0,05 percentage points on the April rate on 0,08 percent to 0,03 percent.

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Coca-Cola, Schweppes bring back original Mazoe flavours

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Coca-Cola, Schweppes bring back original Mazoe flavours

[caption id="attachment_165932" align="alignnone" width="300"] Last week Coca-Cola said "We are fighting obesity, after social media backlash over new Mazoe taste[/caption] THE Coca-Cola Company and Schweppes Zimbabwe on Wednesday said they are bringing back the original Mazoe cordials following customer complaints but will continue to produce the low sugar varieties to sell alongside them. Officials said despite the complaints, sales were up 35 percent in the year to date. “We have listened to consumer demand and appreciate all the feedback that has been received. In order to meet those desires but still provide choice, both the original recipes of Mazoe and the reduced sugar recipes will be offered,” the two firms said in a joint statement. “We stand by the safety…

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