Heads of states from the southern Africa regional bloc, SADC, will today meet in the Democratic Republic of Congo for talks on economic growth and integration.

A dozen heads of state arrived in the capital, Kinshasa, on Tuesday to participate in the two-day summit, which opens on Wednesday.

The leaders will discuss how to promote industrialisation through the transformation of agriculture, the development of mineral resources and the development of value chains at the regional level.

DR Congo also intends to seek the assistance of the bloc to restore peace and security in its territory.

Another aim of the summit is the hand-over of the bloc leadership to the Congolese President Felix Tshisekedi by the current head of the bloc, Malawi President Lazarus Chakwera.

Source: BBC

ZIMBABWE is engaging India for an agreement to import rolling stock as part of continuous efforts to capacitate and revitalise the National Railways of Zimbabwe.

A delegation from Zimbabwe comprising government officials and the NRZ is in New Delhi, India to finalise an agreement on the importation of locomotives and wagons.

The delegation has since engaged an Indian state-owned company Rites Limited, which is into manufacturing rolling stock.

The firm’s chairman, Mr Raul Mithal confirmed that the engagements are part of a deal that will see them exporting rolling stock to Zimbabwe.

“We had intense discussion and we are now in the stage of finalising contracts for the first trench of supplying locomotives, wagons and coaches. This is only the beginning for the export of rolling stock,” Mr Mithal said.

NRZ board chairman, Advocate Martin Dinha is impressed with the quality of the rolling stock after touring the factory in India.

“We have visited the factories and what we saw impressed us. The industrial capacity dovetails with our requirements back home. We have been lagging behind in terms of modernisation, yet NRZ is a key player in our economy,” noted Advocate Dinha.

The deal involves the import of nine locomotives, 350 wagons and DMU passenger coaches.

The delegation also held talks with Indian Minister of State for External Affairs Mr Shri Vellamvelly Muraleedharan, who was in Zimbabwe last month to consolidate bilateral relations between the two countries.

Early this year, President Emmerson Mnangagwa joined his Mozambican counterpart, President Filipe Nyusi in the commissioning of four modern locomotives and 150 wagons in Mozambique that were sourced from India by the Mozambican government.

Source: ZBC News

Opposition Economic Freedom Fighters (EFF) Secretary-General Changala Siame has said reduced inflation and gaining kwacha cannot lead to reduced cost of living in Zambia minus increased production and exports.

Mr Siame said despite reduced inflation the cost of living will remain high because the prices of commodities will be increasing unless Zambia starts producing and increasing exports.

He argued that the Kwacha was only gaining because the dollar was losing value.

“It’s very important to understand fundamentals that cause economic trends. This gives a correct response on how to react to either a positive or negative economic trend. Fundamental and technical analyses are two common words used for those that trade on active stock markets. The two theories affect trader’s decisions to buy or sell stocks.

In Zambia, the strength of the Kwacha against the US dollar is something that brings a lot of excitement to international traders and indeed is used as an economic performance indicator by a common man on the street. However, without understanding why we have a gain or a loss, could lead to serious poor decisions by those who are actually involved in international trade, our local traders,” Mr, Siame said.

“What is interesting in our economy right now, we have a reducing inflation and a stable and gained exchange rate that is actually having less impact on the price of consumer’s goods. The cost of living is still going up and unbearable. In actuality, what is expected is the opposite to happen. A reducing inflation and a stabilizing and gaining currency should translate into cheaper goods but it is not our case. The reason is very simple; our gain in the Kwacha against the US dollar is because of the weakening of the US dollar. If you check the US dollar against the Chinese Yen and Rubles from Russia, you would appreciate our explanation. The UK pound; Euro and Dollar are certainly under pressure as the result of the Ukraine-Russia war. Russia is demanding that oil be bought from their currency, Rubles and not the US dollar. China, India and other countries are buying fuel cheaply from Russia and their currencies are doing fine,” he said.

Mr. Siame has since advocated an enhanced manufacturing sector in Zambia.

“What is happening now, the global economy is deeply divided into two spheres. The BRICS (Brazil, Russia, India, China and South Africa) against the West. Therefore, going forward, it would be very important to make comparisons of exchange against the emerging currency to determine the performance of the US dollar, especially against the Rubles. For Yen, it’s usually manipulated against the dollar. They always peg it down against the US dollar for cheaper export purposes. Therefore, the Chinese Yen is not a good yield stick for purposes of comparison against the US dollar. Our Kwacha has been relatively stable the past month and slightly the previous. Hence, any turbulence in major currency, translates in significant changes in Kwacha as witnessed. Because of our Kwacha gaining on those grounds, the cost of living will still remain high because the prices will still be going up unless we start producing and increasing our exports,” he said.

Mr. Siame added:”What the government should actually be concerned with are the reserves we hold in US dollars which is about $ 2.8 billion. This actually means losing value stored in US dollars. They really need to pay attention to what is happening in the global market and possess an understanding thereof to find correct response to this new development. Gold reserves will prove better and have always been better from time in memorial. Hence, with this positive gain that we have, not knowing how long it would last because the fundamentals are not as a result of our own efforts, the government should take advantage by encouraging our people to import manufacturing machines. This can be done through reducing tax duty on those items. Thus, this will create possibilities of creating manufacturing jobs in the near future. We hope the trend continues in our favor as a country. Wherever we want to go, our feet shall take us there.”

Source: Lusaka Times

African Milling and Nyimba Millers Limited companies have instituted inquiries into reports of underweight bags of mealie meal found on the market by  the Zambia Metrology Agency.

African Milling General Manager, JOMO MATULULU says the company has no outlets of its own.

Mr. MATULULU however says the reports of underweight bags in some independent outlets have been brought to the company’s attention and will be investigated.

And Nyimba Millers Human and Public Relations Officer ALLEN PHIRI says the company is committed to providing a product that meets the demand of customers.

This is according to statements issued to ZNBC News in Lusaka today.

The Zambia Metrology Agency conducted an inspection  between 25 June and July 1, 2022 which showed that some mealie meal bags on the market from the two companies were underweight.

 

Source: ZNBC

GOVERNMENT through the Ministry of Transport and Logistics has said that it has no intentions to stifle youth innovations of the growtthe h of small and medium business.
This came up as a response to a question by the Member of Parliament for Kantanshi Parliamentary Constituency Honourable Anthony Mumba

Hon. MUMBA wanted to know whether the Government is aware that compelling online car-hailing services to register with Road Transport and Safety Agency (RTSA) is stiffing youth innovation and hindering the growth of small and medium businesses and if so, what measures are being taken to ensure that online car-hailing services are not adversely affected by the registration process; and what measures are being taken to enhance electronic communication technology innovations in the transport sector.

In response, Hon. Tayali said Government’s interest is to ensure that the online car-hailing services operate under a well-defined regulatory framework which is backed by law.

He said the existing regulatory framework was designed for conventional taxi operations and not online ride-hailing operations.

The Minister said applying such a regulatory framework to online car-hailing operations has proved a challenge as most of the vehicles registered on the Online Applications may fall off if the law is to be applied strictly.

Further, Hon. Tayali said Government is undertaking all the necessary consultations with all relevant stakeholders and is in the process of issuing tailor-made regulations to accommodate the operations of online car-hailing operators in Zambia while at the same time ensuring that appropriate taxes are paid to the Government.

He said Government will issue Statutory Instruments (SI) that will address these matters. The Minister also noted that Government will not put a deadline to the consultative process in order to do it right, but will, therefore, allow online car-hailing services to continue operating under the status quo until the regulations are issued.

Hon. Tayali also said Government is cognizant of the role that technologies play in facilitating business development and growth. He said Government has and will continue to put in place policies and legislation that embrace the use of Information Communication Technologies (ICTs) in the transport and logistics sector.

The Minister added that Government is in the process of revising the ICT Policy of 2006 and developing the Digital Transformation Strategy and the National Logistics Strategy which imbed the use of ICTs in service delivery.

Source: Lusaka Times

Political Activist DANTE SAUNDERS says Zambia will start seeing the benefits of President HAKAINDE HICHILEMA’s international trips.

Mr. SAUNDERS says the President’s international trips are meant to attract investors.

Speaking to ZNBC News in Chililabombwe, Mr. SAUNDERS commended the President for marketing the country internationally as it has already started bearing fruit, looking at the number of investors that have shown interest in investing in Zambia.

He said once investors start investing in the country, employment opportunities will be created for a lot of Zambians who have been jobless for years.

Mr. SAUNDERS has since called on Zambians and those holding decision-making positions to work with President HICHILEMA as he strives to bring development in the country.

He further said those condemning the President’s international trips should instead allow him to work for citizens whose lives he wants to change through his developmental agenda.

Meanwhile, Mr. SAUNDERS has urged the President to also take note of the challenges that local investors are facing within the country to see how best they can be helped so that they can continue investing in the country.

 

Source: ZNBC

FINANCE Minister Professor Mthuli Ncube is this Monday expected to outline new government measures to tackle the worsening economic crisis with inflation topping 191% – among the highest in the world – while the Zimbabwe dollar has been sliding inexorably against the US green back.

NewZimbabwe.com understands that some of the measures under consideration include providing legal certainty around the continued use of the existing multi-currency regime.

Officials are concerned that the market is not assured that the “system is here to stay for the medium term”; as such a legally guaranteed period may be proposed.

Treasury is also keen to address the reluctance by exporters to release export receipts with huge amounts held in nostro accounts and not circulating in the economy.

A proposal has been mulled to legally ensure that exporters cannot permanently hold onto 70%-80% of their foreign exchange earnings.

Again, and to stop speculative borrowing, a member of the central bank’s monetary policy committee (MPC) revealed at the weekend that interest rates would be increased to levels in line with the rate of inflation.

“We have decided to bite the bullet,” the official told Bloomberg News. “Stability will be achieved through an aggressive monetary policy interest rate hike.”

Treasury confirmed the press conference Sunday with Chief Director Communications and Advocacy Clive Mphambela in a statement saying it would be addressed by Prof Ncube with his deputy and ministry permanent secretary also in attendance.

This comes after President Emmerson Mnangagwa told the national conference of his ruling Zanu PF party that government would announce new measures to tackle inflation on Saturday.

Indicating that ruling party supporters are also getting restive over the increase in the cost of living, the Women’s League told Mnangagwa that “The increase in prices is quite shocking.”

Source: New Zimbabwe

The latest Money Laundering and Terrorist Financing Trends report has revealed that proceeds of crime used to acquire property led to price distortions in the real estate market.

The 2021 report launched by the Financial Intelligence Centre -FIC- yesterday shows that some Prominent Influential Persons bought high value properties using funds suspected to be proceeds of corrupt activities.

The report states that some individuals made cash payment in excess of seven million kwacha towards acquisition of property with a purchase consideration in excess of 11 million kwacha.

The Report indicates that the money was kept at the home of the purchaser.

The FIC report also reveals that some Zambians were made to register businesses and open bank accounts by foreign nationals to externalize funds.

 

Source: ZNBC

THE. Reserve Bank of Zimbabwe governor John Mangudya has been forced to hold a meeting with bakers over the price of bread as the government was rocked by public health workers strike on Monday.

Bread prices have recently alarmingly spiked to levels beyond the reach of many citizens along with the cost of other basic commodity.

A loaf of bread currently costs ZW$629 which is equivalent to US$1,85 in line with the official exchange rate.

Players in the baking sector justified the increases on a number of factors such as input costs involved in the sourcing of raw materials and delivery of bread.

But in a statement Monday, Reserve Bank of Zimbabwe governor, John Mangudya announced that he had a successful meeting with the sector’s players which will see the commodity’s price reducing going forward.

He said the meeting took into account the submissions by the baker’s association and the need to stabilise bread price and an agreement was reached for baker’s association to access the full requirements of foreign exchange through the weekly auctions for importation of inputs and procurement of fuel for the distribution of bread across the country.

“In view of the positive engagement with the baker’s association, it is expected that members of the association will review the price of bread downwards.

Going forward the price of bread will be reviewed downwards in line with economic fundamentals that include global price trends of inputs and the movement of foreign currency exchange rate.

However, the development comes after prices of other commodities continue to go beyond the reach of many citizens whose salaries have not kept pace with inflationary trends.

The country is also not managing to tap into its agriculture potential to create enough raw materials like grains as confirmed officially that local wheat production is only enough to cater for less than four months a year.

The Ukraine/Russia war disturbances have also frustrated efforts to stabilise the decades long troubled economy leaving authorities with no option except to pass down the effects of fuel prices to consumers.

Source: New Zimbabwe

THE DEBT RESTRUCTURING PROCESS AND THE IMF SUPPORTED PROGRAMME

Lusaka, Sunday, 19th June 2022 – In light of public statements by certain sections of society on the status of the International Monetary Fund (IMF) Supported Programme and the debt restructuring process, the Ministry of Finance and National Planning considers it necessary to clarify on some matters of concern and on others that have been misrepresented.

The New Dawn Government reached a Staff Level Agreement (SLA) with the International Monetary Fund barely three (3) months after assuming office in August, 2021. This was on the backdrop of futile efforts previously pursued for more than five (5) years. The Government’s anticipation was for the IMF Supported Programme to be agreed upon by June 2022, however, there are some finalisation steps, mainly related to the debt restructuring process, that still need to be undertaken before the IMF Management and Board considers and approves the programme.

The consideration of Zambia’s application for an Extended Credit Facility by the IMF Board and the country’s debt restructuring process, are interrelated. Therefore, getting the IMF Board approval is centred on getting financing assurances from the Official Creditor Committee (OCC) under the G20 Common Framework for Debt Treatment. Their pace of progress, however, is not entirely dependent on the Zambian Government’s efforts. Notwithstanding, it is our expectation that with the due processes followed, we will get an IMF Supported Programme this year and place our debt on a sustainable trajectory, once again.

For the information of stakeholders, negotiations with our Creditors under the Common Framework are supported by an independent Debt Sustainability Analysis conducted by the IMF and the World Bank, accompanied by reforms, to ensure the future sustainability of public debt through an IMF Supported Programme (in Zambia’s case a 3-Year Extended Credit Facility). The whole process is systematic and entails substantial traction as we move towards the attainment of credible assurances on how the country’s debt will be treated by the Official Creditor Committee before the IMF staff submit Zambia’s case to the IMF Management and the Board for consideration.

Some key milestones are as follows:

  1. Finalisation of the Debt Sustainability Analysis (DSA) with the IMF and the World Bank. This has been done;
  2. Pledges by multilateral lenders to provide concessional financing to Zambia as part of the effort to resolve the country’s financing limitations based on the DSA results;
  3. Convening the OCC (mainly bilateral related lenders) to discuss Zambia’s request for debt relief under the G20 Common Framework for Debt Treatment. This action has commenced; and,
  4. Convening, immediately after the OCC, a committee of Commercial Lenders (Eurobonds, Commercial Banks, and Private Lenders etc). This is pending completion of discussions by the OCC.

Pursuant to some of the milestones listed above, the Government has regularly engaged both Official Creditors and Private Creditors. They have been provided with economic policy and debt data, with a view to facilitating decision-making and successive meetings of the two creditor groups.
High-level bilateral discussions have been held, too. One such engagement was the virtual summit meeting between Mr. XI JIPING, the President of the Peoples Republic of China (Zambia’s biggest bilateral creditor and the world’s second-biggest economy) and Mr. HAKAINDE HICHILEMA, the President of the Republic of Zambia (Currently one of Africa’s best investments destinations). The engagements resulted in the first successful meeting of the OCC on Thursday 16th June 2022, under the auspices of the Paris Club and the G20. The meeting with private creditors will follow through after a consensus is reached by Official Creditors.

The Government has been engaging multilateral partners for concessional financing as part of the effort to resolve Zambia’s fiscal limitations. As announced before, the engagements have culminated in several benefits such as the pledge by the World Bank to support the national budget through a Development Policy Operation. As soon as the IMF Supported Programme is approved by the IMF Board, it is envisaged that the World Bank will supply funding amounting to US$275 million over the next three (3) years.

Furthermore, the Bank is providing sizeable positive net flows to Zambia. Under IDA19, the Bank is committing approximately $959 million to support Zambia’s recovery from the multiple debt and economic crises and help to institute reforms for inclusive growth and poverty reduction. Of this, U$$294 million has already been committed for scaling up social cash transfers and projects to strengthen the COVID-19 response, including vaccination and emergency health financing to improve service delivery.

The remaining U$$665 million will be presented in three operations to the World Bank Board for approval within June 2022. The program includes two results-based operations, the first to reinvigorate growth in agriculture and support reform of the agricultural subsidy regime and the second to strengthen decentralized public service delivery while enhancing public financial management, accountability, and citizen engagement and will support the increased resource allocation towards Constituency Development Fund. The third operation will finance additional social protection spending in response to various shocks.

Furthermore, upon agreement of the Country Assistance Strategy during the second half of 2022, financing is also expected from the Africa Development Bank (AfDB) over the next 3 years. This implies that over the medium-term, an estimated US$500 million or more will be available to Zambia (through the Africa Development Fund), for economic and social development. This is another demonstration of a functional and cordial relationship between Zambia and her multilateral partners.

Going forward, the Government will continue to work tirelessly toward returning the country to a state of fiscal stability that will facilitate sustainable growth. Through the soon-to-be-launched Eighth National Development Plan (8NDP), the Public-Private Dialogue Forum and other development delivery frameworks, the New Dawn Administration will continue to make sincere efforts targeted at trending the living conditions of our fellow citizens towards equal opportunities, sustained prosperity and poverty reduction, on the platform of a stabilized and transformed economy that inspires improved investor confidence, facilitates more local and foreign investments, creates more opportunities and jobs, and nurtures the economic freedom of the people of Zambia.

Issued by:
(Original Signed)
MINISTRY OF FINANCE AND NATIONAL PLANNING

Source; Lusaka Times

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