By Funny Hudzerema

HARARE – Government says the technical teams working on the ease of doing busi-ness reforms should increase momentum in order to attract new investment.

Under the reforms, Govern-ment is planning to review policies which stifle the ease of doing business environ-ment in order to improve the country’s rankings on global competitive indices.

Officially opening the ‘Ease of Doing Business Sympo-sium’ which was hosted by the Office of the President and Cabinet and The Her-ald Business, Vice President Emmerson Mnangagwa said

News Update as @ 1530 hours, Thursday 16 June 2016

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Expedite ease of doing business reforms, says VP Mnangagwa

Vice President Emmerson Mnangagwa

there is need for renewed speed in carrying out the reforms.

“What is needed is to increase the momentum of the reforms to ensure that all bottlenecks are removed for at the end of the day we should always remember that capital goes where the envi-ronment is favorable, so we need to do everything in our means to be a destination of first choice of capital,” he said.

“As Government therefore, we will continue to assess our business operations in order to identify those areas that need urgent surgi-cal therapy to improve our investment climate, empower our local entrepreneurs, and attract Zimbabweans in the Diaspora and foreign investors to bring capital to Zimbabwe.

“Whereas our target is to get to a respectful top 100, the goal should not just be chas-

ing rankings but to achieve correlation between ease of doing business and an increased number of foreign and local investors and those in Diaspora,” he said.

He added that Government is also implementing an e-Government platform in order to re-engineer and modernise the public sec-tor systems and process to improve access efficiency and affordable services to the ICTs.

“It is hoped that such meas-ures will greatly facilitate the registration of those entrepreneurs operating in the informal sector and we

believe that formalisation will enable small business to benefit from loans, access to tenders and will also enable payment of tax.

VP Mnangagwa added that it was critical for us to incor-porate youths, women and those outside the formal economy among other groups to effectively participate in the economic growth of the country.

In his remarks during the same event Zimpapers board chairman Mr Delma Lupepe said Zimpapers is ready to work with Government min-istries in spreading the ease of doing business across the country.●

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BH243

BH244

By Tawanda Musarurwa

HARARE -Unilever Zimbabwe says it is in the process of engaging Government and other private business to be part of its “sustainable living plan,” which last year delivered nearly half of the consumer goods giant’s growth in 2015.

Unilever has sales in over 190 countries and generated sales of 53,3 billion euros last year. The ‘sustainable living plan’ is based on the premise that business should play a leadership role disrupting markets in support of sustainable living — and they will be rewarded by consumers who are also seeking responsi-bility.

Unilever Zimbabwe managing director Mr Hilary Muzondiwa told BH24 that the idea is to promote business models that limit adverse effects on the planet’s ecosystem.

“As we Unilever we are facili-tating the process…it’s really

about mobilizing business involvement in the whole sus-tainability agenda. Business is involved in using up most of the resources and converting them for the general population’s use therefore as businesses we are positioned very well to actually drive the sustainability agenda,” he said.

Mr Muzondiwa was speaking on the sidelines of an engagement that was attended by a number of companies and organisations including Standard Chartered Bank, Econet, the Confederation of Zimbabwe Industries, Lafarge and the Zimbabwe National Chamber of Commerce among others. He added that Unilever had begun engaging Govern-ment at a local level.

“We want to look at how we can partner with business and Government to drive initiatives such as this. For example, the public toilets that we have been refurbishing with brand Domes-tos, we have worked with the

City Councils namely the City of Harare and the City of Bulawayo and we will be doing the same with Gweru as well which is all part of local Government.

“At the moment we quite frag-mented in our approach, so what today was about was for the private to showcase what they have been doing so that we start a conversation and we can find other ways of partnering with business, with Government and with the civil society in order to drive this forward,” he said.

The Unilever Sustainable Living Plan (USLP) was initiated in 2010, and the group’s fifth annual report showed that the company’s “sustainable liv-ing” brands grew 30 percent faster than the rest of business. Locally, Unilever’s “sustaina-ble brands” include the Dove and Lifebouy soaps, Knorr, and Domestos. The MD said locally the USLP targets were at about 80 percent.

“So far we are on track with

more than 80 percent of our tar-gets as defined by the Unilever Sustainable Living Plan.”

The company has since stopped disposing of its non-hazardous material in landfills and is also treating effluent at its Harare plant.

“When you look at the effluent treatment plant that we have at our factory, when you look at how we are managing our non-hazardous waste, which as we said we no longer send it to the landfill, we are recycling.

It’s an expense to us right now because we don’t have the recycling capacity within the country so we are sending them outside of the country to be recycled. But we have chosen to spend that money to ensure that it’s recycled rather than having it dumped in landfills,” said Mr Muzondiwa.

The Unilever group was ranked first in its sector the 2015 Dow Jones Sustainability Index.●

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Unilever Zimbabwe pushes ‘sustainable business model’

BH246

BH247

HARARE –Zimbabwe’s annual inflation for May stood at -1,69 percent after shedding 5 percentage points from -1,64 percent in April as the country battles cash shortages.

Zimbabwe has been in defla-tion since February last year and is projected to remain in the negative territory for the remainder of the year.

Latest figures from the Zimba-bwe National Statistics Agency show persistence in the neg-ative trend largely influenced by negative price movements in the food and non-alcoholic beverages category.

“This means that prices as measured by the all items CPI (Consumer Price Index) decreased by an average of -1,69 percentage points between May 2015 and May

2016,” Zimstat said.

Month-on-month inflation in May was -0,24 percent shed-ding 0,02 percentage points on the April rate of -0,21 percent.

The rate of increase in the price of goods and services had remained steady in over half a decade after the country adopted use of multiple foreign currencies, primarily the United States dollar.

But a slowdown in economic activity has heavily impacted on consumer spending power as most companies struggle to stay afloat.

Analysts say a failure to stem cash shortages will further impact on demand for goods and services in the economy

. - New Ziana.●

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Zim annual inflation at -1,69 percent in May

BH249

HARARE -Ministers from the African Union (AU) member states including Zimbabwe and the Japanese govern-ment are expected to meet in Banjul, the Gambia this Friday as preparations for the sixth Tokyo International Conference on African Devel-opment (TICAD) to be held in Kenya in August this year intensify.

Established in 1993, TICAD, which has the twin objec-tives of promoting high-level political dialogue between

Africa and Japan as well as mobilizing support in favor of African development initia-tives, has for the five times it has been held, been hosted in Japan. Kenya plays host to TICAD VI this August.

“The preparatory ministe-rial meeting for the TICAD VI Summit aims to engage the African and Japanese ministers to review the work done in preparation for the upcoming TICAD VI Sum-mit, to be held in Nairobi, Kenya from 27 to 28 August

2016, and more importantly consider the draft Nairobi Declaration,” the AU said in a statement.

A meeting of senior officials was held in Djibouti in March this year to consider critical issues to be discussed at the conference, paving way for this week’s Ministerial meet-ing in Banjul.

The AU said promoting structural economic trans-formation through economic diversification and industri-alisation, promoting resilient

health systems for quality of life; and promoting social stability for shared pros-perity were among the key issues identified for discus-sion.

In addition to government officials, international organ-isations, representatives of partner countries, interna-tional, regional and sub-re-gional organisations, African and Japanese civil society would also take part at the Banjul Ministers meeting

- New Ziana●

AU, Japan step up TICAD VI preps

10 NEws

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BH2411

BH2412

HARARE -The equities market traded flat as the mainstream industrial index remained unchanged at 93.66 in mixed trading.

Beverages giant Delta finally snapped a string of recent losses to rise $0,0150 to close at $0,5200, while giant insurer Old Mutual advanced $0,0124 to $2,3125 and CFI Holdings jumped $0,0074 to trade at $0,0800.

Also on the upside was ART Corporation which closed higher at $0,0201 following a $0,0033 gain.

On the downside, BAT eased $0,0287 to close at $11,8500, while conglomer-ate Innscor dropped $0,0085 to $0,1700 as Meikles declined by $0,0060 to settle at $0,0720.

Telecoms giant Econet traded $0,0050 lower at $0,2097

while Barclays slipped $0,0047 to close at $0,0193.

The mining index was flat at 26.24 as Bindura, Falgold, Hwange and RioZim remained

unchanged on previous price levels at $0,0120, $0,0050, $0,0300 and $0,1700 in that order.

- BH24 Reporter ●

Bourse stalls

13 ZsE

BH2414

MoVERs CHANGE ToDAy PRICE UsC sHAKERs CHANGE ToDAy PRICE UsC

ART 2.01 BARCLAyS -19.58 1.93

CFI 8.00 ZIMPAPERS -8.33 0.55

Delta 52.00 MEIKLES -7.69 7.20

OLD MUTUAL 231.25 INNSCOR -4.76 17.00

ECONET -2.32 20.97

BAT -0.24 1,185.00

INDEx PREVIoUs ToDAy MoVE CHANGE

INDUSTRIAL 93.66 93.66 +0.00 points +0.00%

MINING 26.24 26.24 +0.00 POINTS +0.00%

15 ZsE TABlEs

ZsE

INDICEs

Stock Exchange

Previous

today

16 DIARy oF EVENTs

The black arrow indicate level of load shedding across the country.

PowER GENERATIoN sTATs

Gen Station

16 June 2016

Energy

(Megawatts)

Hwange 502 MW

Kariba 565 MW

Harare 30 MW

Munyati 12 MW

Bulawayo 27 MW

Imports 0 - 400 MW

Total 1381 Mw

22 JUNE 2016 -- Zimre Holdings Limited 18th Annual General Meeting; Place: NICOZDIAMOND Auditorium, 7th Floor Insur-ance Centre, 30 Samora Machel Avenue, Harare; Time: 1430 hours...

22 JUNE 2016 -- GB Holdings Limited Annual General Meeting; Place: Cernol Chemicals Boardroom, 111 Dagenham Road, Wil-lowvale, Harare; Time: 11.30 hours...

23 JUNE 2016 -- Zimpapers 89th Annual General Meeting; Place: Zimpapers Ltd Boardroom, Sixth Floor Herald House, Cnr. G. Silundika/Sam Nujoma Street, Harare; Time: 1200hrs…

24 JUNE 2016 -- Dawn Properties Annual General Meeting; Place: Great Indaba Room, at the Monomotapa Hotel, 54 Parklane, Harare on Friday; Time: 10:00 hours...

22 JUNE -- Lafarge Cement Zimbabwe Annual General Meeting; Place: Manresa Club, Arcturus Road, Harare; Time: 10:30hrs

30 JUNE -- African Sun Annual General Meeting; Place: Inyangani Room, ground floor at Holiday Inn Harare, Corner 5th Street and Samora Machel Avenue; Time: 12:00hrs

THE BH24 DIARy

ABUJA - Nigeria's central bank said on Wednesday it would begin "purely" mar-ket-driven foreign currency trading next week, abandon-ing its 16-month peg and setting the stage for the naira to fall sharply.

Nigeria's central bank pre-viously pegged the naira at 197 to the U.S. dollar but the currency trades at about half that on the black market as slump in oil revenues has hammered public finances and foreign currency reserves. The new trading rules begin on Mon-day, Central Bank Governor Godwin Emefiele said.

The change of tack is a "managed float" and puts Nigeria in line with most central banks, including the Bank of England, a senior central bank official told Reuters. Nigeria's central bank has no target for the naira, he said.

The latest interbank level will be posted on the central bank's website daily from Monday, the official said,

adding: "The old rate of 197 does not exist anymore."

Following the announce-ment, three economists esti-mated the fair value of the naira between 280 and 300 against the dollar, although the black market rate is around 370.

Nigeria, Africa's largest crude exporter, has resisted devaluing its currency for more than a year despite other major oil producers, including Russia, Kazakh-stan and Angola, allowing currences to fall amid lower crude prices.

The central bank will stil l be able to inject dollars into the market, giving it some control over the exchange rate within the limit of its foreign reserves which fell to $26.7 bill ion in June, from $42.8 bill ion in January 2014.

Emefiele hopes opening up trading will ease severe U.S. dollar shortages caused by a slump in oil revenue.

With a likely sharp fall for the naira, Nigerian products will become relatively cheap and imports more expen-sive, which should stimulate

the domestic economy but also lift inflation.

"To improve the dynam-ics of the market, we will introduce foreign exchange primary dealers who would be registered by the CBN (central bank) to deal directly with the bank for large trade sizes on a two-way quote basis," Emefiele told reporters.

Nigeria's stock market gained 3 percent following the announcement.

"This is a major about-turn. The central bank has traditionally favoured a managed rate and preferred a strong currency to con-tain inflation," said Gregory Kronsten, head of macroe-conomic and fixed income research at FBN Capital in Lagos.

"It seems the CBN is eager the market captures forex from remittances (inter-national money orders) as well as FDI (Foreign Direct Investment)," he said - Reuters●

17

Nigeria to abandon naira peg in favour of open market trading

REGIoNAl NEws

The pound dropped toward a two-month low versus the dollar as traders awaited the Bank of England’s final policy meeting before the U.K. votes on its membership of the European Union.

Sterling weakened against 10 of its 16 major peers, drop-ping to a three-year low ver-sus the yen. The June 23 ref-erendum has dominated the currency market with vola-til ity surging as polls sug-gested a lead for the “Leave” campaign this week. Last month, BOE Governor Mark Carney said Brexit could lead to a U.K. recession as the central bank downgraded its growth forecasts.

The prospect of Britain exiting the world’s largest trading bloc has fueled nerv-ousness across the globe, with the Federal Reserve saying on Wednesday that the referendum was a fac-tor in its decision to keep interest rates on hold. The Swiss National Bank kept its rates unchanged Thursday. Officials there have said the British referendum has

potential to cause “enormous stress” in Europe.

While no economists are forecasting a change in BOE policy Thursday, markets are pricing in a more than 50 percent chance of an inter-est-rate cut before the end of the year.

Data have been offering a mixed picture of the U.K. economy. Reports this week showed inflation holding at 0.3 percent, the unem-

ployment rate unexpectedly falling and wage growth accelerating. Sterling pared its decline Thursday as data showed May retail sales rose a more-than-predicted 0.9 percent.

‘Negative Environment’

“It’s a nervous and very negative environment for the pound,” said Niels Christensen, chief currency strategist at Nordea Bank AB in Copenhagen. “With Brexit

there will be a lot of uncer-tainty that will hurt activity and it makes sense for the market to price in the proba-bility of a cut.”

The pound fell 0.2 percent to $1.4182 as of 9:40 a.m. Lon-don time. It touched $1.4091 on Tuesday, the lowest since April 14. Sterling weakened 0.2 percent to 79.45 pence per euro. The U.K. currency dropped as much as 2.8 percent to 146.40 yen, the lowest level since April 2013.

A two-week measure of pound-dollar volatil ity based on option prices surged to the highest level on record this week as five polls in 24 hours showed more sup-port for leaving the EU than remaining.

U.K. government bonds rose, with the 10-year yield fall-ing as much as three basis points, or 0.03 percentage point, to a record-low 1.089 percent. The 30-year gilt yield touched an all-time low of 1.908 percent.

- Bloomberg●

18

Pound approaches two-month low before BOE policy announcement

INTERNATIoNAl NEws

By Nigel Gambanga

After years of criticism and the creation of an uncom-fortable situation that was amplified by the country’s cash crisis the Reserve Bank of Zimbabwe announced a new set of bank charges.

The move is commedable and even though it’s far from the financial services charges utopia that most Zimbabwe-ans have called for (ATM withdrawals still cost up to $2.50), its the first indication that policy can ease some of the challenges we face.

It also shows that as the reg-ulator, the Reserve Bank can and should also review mobile money tariffs.

The assumption was that the as the high cost of elec-tronic transactions has been highlighted as a barrier to a “cashless society”, the charges for sending, receiving and cashing out money from mobile money wallets would also immediately come under

review. That is yet to happen.

To put the costs into per-spective, it costs $2.55 for a $100 cashout and as much as $4.55 to cash out $500 from a mobile money wallet – figures that now exceed the $2.50 ceiling set for ATM withdraw-als.

Mobile money services have a wider footprint than tradi-tional banking services and a reduction of mobile money tariffs would impact a larger segment of the population.

According to a FinScope sur-vey published in 2015, only 30% of the Zimbabwean adult population had an active bank account. Of the 70% of the market that was unbanked, 74% dismissed a bank account as being unnecessary or unaffordable.

This is contrast with mobile financial services that had registered over 7,3 million users by December 2015. All these users depend on the ubiquity of mobile money

services to pay for services as well as send and receive money from people within the country and outside it.

A national count of over 33,000 agents also means that mobile financial services are the “banks” that most Zimbabweans are familiar with and turn to for most of their transactions – something also supported by official figures which show that 88% of transactions are made through mobile money.

Understandably these changes won’t happen at the snap of a finger. The RBZ still has to work with mobile money service providers, who are predominantly the mobile net-work operators.

Despite isolated and applaud-able efforts to lower or scrap some of their charges, mobile operators are likely to resiste any massive reduction on fees.

As the mobile telecoms reve-nue model adapt to changes

like falling income from tra-ditional pillars like voice and SMS, mobile financial services have offered a glimmer of hope with their growth poten-tial.

All this has been enabled by investments which have included network support, service develeopment, wider agent networks and service awareness camapigns which have made mobile financial services the success that it is.

Blindly hacking down tariffs would affect a recovery on such an investment, so the RBZ would need to factor that into its tariff review.

In any case though, these considerations should have made already, especially as the bank charges review was being intensely debated as a cash crisis solution.

Mobile money tariffs also need to be considered, for the sake of the millions who are paying them everyday– TechZim●

19 analysis19 ANAlysIs

Review of bank charges welcome, now mobile money tariffs should be lowered as well