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The delay in appointing a new Agriculture Minister by President Hakainde Hichilema risks forex inflows and halting mealie meal exports for at least two months after the previous deal hatched with government expired at end of August 2021.

The Millers Association of Zambia (MAZ) has confirmed that it members exported close to 80, 000 metric tonnes of mealie meal as opposed to the 100, 000 metric tonnes that it anticipated to export in the exportation programme that ended on 31 August 2021.

Association President Andrew Chintala said the association estimated to export 100, 000 metric tonnes but the market experienced a downtrend in terms of pricing at the border in mid-august due to the appreciation of kwacha, therefore the failure to meet the 100, 000 metric tonnes exportation target that was approved.

Chintala confirmed that exports have currently stopped as the association signed the Memorandum of Understanding (MOU) which was running up to the month end of August 2021 with the Ministry of Agriculture under the then Patriotic Front (PF) government.

Chintala said the association would again begin talks with the new government concerning the continuance of the exportation of mealie meal as soon as the Minister of Agriculture is appointed.

Speaking in an interview with the Zambian Business Times – ZBT, Chintala said the only condition millers needed to meet to be able to export mealie meal was leaving 80% of their production on the domestic market and sell 20% at the recommended price according to the MOU signed.

He said it was an open programme and millers were allowed to export 20% and sell 80% of their production to the local market in order to stabilize the prices adding that millers on the export programme tried to maximize on the exports and in return offer an affordable price for the local consumers.

He noted that over 33 companies were participating in the export programme and different companies came on board every month. Government allowed millers with their own maize to export 20% of their mealie meal and the decision was in line with the policy directive that government would only deal with millers who buy their own maize from farmers.

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The delay in appointing a new Agriculture

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The Bank of Zambia (BOZ) says it cannot state at which exchange rate the Kwacha will stabilize and settle at against the US dollar. This follows a period of rapid appreciation of about 30% within four weeks that has caused mayhem for both importers and exporters as far as planning is concerned.

When asked to at least share a projected range were the Kwacha to US dollar exchange rate pair would settle by the Zambian Business Times – ZBT, BOZ Governor Christopher Mvunga said the market dynamics will dictate where the rate will eventually sit as the country has a free floating exchange rate system.

Mvunga said the central bank does not hold or dictate the exchange rate but it may intervene to ensure price stability.

Speaking during the Monetary Policy Committee Announcement and Press Briefing, Mvunga said the bank of Zambia sells US dollars when there is a shortage on the market and buys the dollars when there is excess supply.

He explained that the country has a Liberal exchange rate regime and a Liberal market therefore only the market can dictate where the kwacha will sit depending on economic dynamics.

“I can’t tell you whether it will be at K5, whether it will be K17, whether it will be K20, I can’t tell you because we have to monitor the market and the market will dictate”, he said.

Analysts have questioned this policy were the Zambian Central bank has adopted to go with the utopian free floating regime which some have described as academic proposition rather than a practical method.

Without a target range, there is no way of holding anyone responsible for whatever rate the Kwacha trades with the dollar. There is need in Zambia to come up with a mechanism were a target range is set and announced so that there is some level of responsibility around the currency expectations.

The newly inaugurated UPND government is on record to have pledged to deliver an exchange rate of at least K10 per US dollar. From the the four weeks appreciation run so far, it looks more viable that Zambia may get back to a single digit trading exchange pair between the Kwacha and the US dollar.

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The Bank of Zambia (BOZ) says it

Lifestyle

Pardoned photographer Cornelius Mulenga popularly known as Chellah Tukuta qualifies to be appointed as Statehouse official Photographer.

This follows indications that Chellah Tukuta has been left out as does not qualify for appointment into the civil service or government as official statehouse photographer following his earlier conviction in a case of criminal libel and defamation  by Lusaka High Court Judge Lameck Mwale, sitting as Chief Resident Magistrate.

However, the Prisons Care and Counselling Association (PRISCCA) Executive Director Dr. Godfrey Malembeka has confirmed that ex-convicts pardoned by the President have no criminal record and are completely clean but ex-convicts who complete their sentence cannot work for the civil service, which is biased.

Malembeka further stated that there is need for the Public Service Commission Act to look at each case individually and see what an ex-convict was imprisoned for and if what an individual was sentenced for is completely different from the role they were playing at their work place, they should be reinstated.

Speaking in an interview with the Zambian Business Times – ZBT, Malembeka said according to the Police Act, once the police pick an individual’s fingerprints, they cannot easily be reinstated into public service and some countries have immigration laws that do not allow ex-convicts into the country.

“Even contesting for member of parliament is difficult but some members of parliament have been convicted before but once they are pardoned by the president, they go back to parliament, so that is why we are saying, what is the difference between a member of parliament and another Zambian”, he said.

“Security wings such as the Zambia Army cannot employ an ex-convict. If you want to own a gun for personal security, you cannot because you are an ex-convict. For example you are a journalist and you hit someone as you were driving, why shouldn’t you be reinstated”, he said.

He said when a civil servant is convicted, they can’t easily be reinstated by government after completing their sentence especially by government including the private sector which is a bit flexible but also discriminatory.

Malembeka explained that these issues need to be revisited and the association has been advocating for their reforms for the past twenty years adding that Civil Society Organisations (CSOs) and everyone working in the criminal justice system should team up and lobby for the review of such laws in order to eliminate stigma and discrimination.

He said there is need to make sure educated people leaving correctional facilities as professionals with academic qualifications such as degrees are employed by the private sector and also by the major employer, which is government.

He noted that the Zambia Correctional Service (ZCS) produces not less than 20 graduates per year from the University of Zambia (UNZA) and other private universities adding that major correctional facilities are all examination centres.

“People are saying we are going back to school and getting degrees but the biggest employer government does not employ us”, he said.

“These are professionals, Ministry of Education is conducting examinations inside, they have declared major correctional centres as examination centers, so that contradicts one arm of the government which is emphasizing the correctional model and then the security arm is saying no, we cannot still embrace you and yet we are under the new paradigm shift”, he said.

He mentioned that the association has been calling on government to consider revising the laws and is hopeful that the new government will consider, as that will empower ex-convicts who are leaving correctional facilities with skills and academic qualifications.

Chellah Tukuta was among the sixty (60) people that were pardoned by former President Edgar Lungu as he was exiting office, in what was seen as a deal cut between the outgoing and incoming president as the list had people seen to have been aligned to both the incoming [UPND] and outgoing [PF] political parties.

 

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Pardoned photographer Cornelius Mulenga popularly known as

Markets

The International Monetary Fund – IMF should not just look at lumping more debt on Zambia’s existing debt burden but instead help the country on how best it can retain forex back into the country from its boosted copper exports.

With improved International prices, Zambia is currently exporting more than US$30 million worth of copper a day, our total copper export earnings could be around K35 to 40 million per day. So if we are saying K40 million per day, in 10 days its K400 million and 30 days its K1.2 billion, so why do we still need to borrow and be put on an IMF bail out package when we could alternatively look at how a significant volume of our current exports could be banked locally?

The Private Sector Development Association (PSDA) has stated that it is important for Government [through the ministry of finance] to publish what criteria the International Monetary Fund – IMF bailout package is based on and how it is going to help the Zambian economy.

PSDA chairperson Yusuf Dodia said at the moment the IMF program is shrouded into too much secrecy and haste to the extent that people are becoming suspicious about the true intentions of the getting on an IMF bailout program.

Speaking in an exclusive interview with Zambian Business Times – ZBT, Dodia said it was important for the country to understand what conditions the IMF bailout packages comes with and also to appreciate why the IMF are interested in giving Zambia money.

He said, “furthermore, we are exporting more than US$30 million a day in copper exports, our total copper export earnings could be around K35 to 40 million per day. So if we are saying K40 million per day, in 10 days its K400 million and 30 days its K1.2 billion, so why do we still need the package?

“So the amount of money we are intending to get from the IMF is equivalent to one month of exports of Zambian products, so do we need to go the IMF way or could we use our export earnings as something to re-capitalize the economy?”.

“So the question is what are the strings or conditions that are attached to the IMF?, we need to be clear about that. We also need to appreciate why the IMF are interested in giving us money instead of helping us to retain the resources which we have from exports,” Dodia said.

He said these were very tricky issues that needed to be discussed and understood before going for the programme.

Dodia explained that, “We need to get a better eye view to say if we get this package how is it going to help because usually the conditionalities coming from the IMF will be to protect the foreign investors and yet it’s the foreign investors who are actually making the country poor.

He said looking at how much copper is leaving Zambia every day and yet Zambia does not get much [forex] out of it in terms of resources coming back into Zambia, there is need to ask ourselves these questions.

“We need to ask ourselves, is it worth it to allow all this copper to go like that? Why is the IMF not seeing it as problem that needs to be addressed? So at the end of the day, people have become suspicious of the role of the IMF, is it going to help Zambia or to keep Zambia in debt or to put Zambia into further debt.

So I think it is important for us to really reflect on what is going on, on the ground on this programme,” Dodia added.

Newly appointed Finance Minister Dr. Situmbeko Musokotwane who has returned to this role for the second time after having served in the MMD government has come under public scrutiny for his open haste to conclude the IMF extended credit facility which he un-solicitedly announced that he will conclude before the end of this year 2021.

Dr. Musokotwane has not been able to clearly explain or give credible examples of which African country has ever gotten better off after getting on an IMF program, has not been able to publish the conditionality’s under discussion as well as other key contentious issues of his impending deal.

The new finance minister has been challenged to be more transparent and move cautiously to ensure that collective Zambian interests are taken into consideration before this deal is closed. Zambia’s history with the fund is not rosy and the calls to act with caution when it comes to IMF is not unfounded.

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The International Monetary Fund - IMF should

Tech

The Zambia Medicines Regulatory Authority (ZAMRA) says it will advise in due course, on whether it will prosecute Chrismar Earthmoving Equipment and its directors for imported and unauthorized 10, 000 doses of suspected Covid-19 vaccines into the country.

ZAMRA on Tuesday announced that it had intercepted and destroyed a consignment of 10,000 doses worth US$150, 000 of a suspected covid-19 vaccine imported into the country without authorization by an importer named Chrismar Earthmoving Equipment.

Speaking in an interview with the Zambian Business Times – ZBT ZAMRA senior public relations officer Christabel Iliamupu said the authority would advise whether the proprietors of Chrismar Earthmoving Equipment would be prosecuted for this act. Valden Findlay is the prominent businessman behind Chrismar Earth Moving Equipment.

According to the Medicines and Allied Substances Act No 3 of 2013, “(1) a person shall not import any medicine or allied substance without an import permit. This section does not apply to any medicine or allied substance imported by a traveller entering Zambia for the traveller’s use as may be prescribed.

The Act provides that a person who contravenes subsection (1) commits an offence and is liable, upon conviction, to a fine not exceeding one million penalty units or to imprisonment for a period not exceeding three years, or to both.

The authority seized a vaccine named Hayat-Vax (SARS-COV-2 Vaccine (Vero Cell), inactivated valued at US$150, 000. The seizure was necessitated as the vaccine was not registered or authorized by ZAMRA for use on the Zambian market and was also not listed under the World Health Organisation emergency use listing procedure.

The importer did not have a pharmaceutical license to sell, store, distribute, or supply and the importer did not have an import permit to authorize importation. The suspected vaccine where imported by Chrismar Earthmoving Equipment and are purported to have been manufactured by Gulf Pharmaceutical Industries in United Arab Emirates (Middle East.

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The Zambia Medicines Regulatory Authority (ZAMRA) says

Lifestyle

The Anti-Corruption Commission (ACC) has advised that members of the public can anonymously report suspected cases of corruption to the commission on toll free numbers with assurance that their identity will be safeguarded.

Commission Spokesperson Queen Chibwe said the public could make use of the commission’s presence in provincial centres or contact the commission using the Toll free line, which is 5980 and is available on Airtel, MTN and Zamtel.

Chibwe said the public could also report individuals suspected to be [or to have been] involved in corrupt practices using the social media platforms, which are Facebook and Twitter. She said it is the commission’s desire to see members of the public participating in the fight against corruption by among others things, reporting suspected cases of corruption to the commission.

According to information made available to the Zambian Business Times – ZBT, Chibwe said the commission is a professional body that values and upholds confidentiality therefore anonymous whistleblowers of corruption will be respected and their identity protected.

She noted that the Anti-Corruption Commission is mandated by the Anti-Corruption Act number 3 of 2012 to investigate any person involved in corrupt practices adding that the commission carries this mandate impartially whether the person involved is in government or not.

Following the change of government, there are heightened reports of former government officials as well as their contacts who are suspected to have been involved in corrupt practices. These individuals or companies can now be reported anonymously using toll free number across Zambia.

 

 

 

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The Anti-Corruption Commission (ACC) has advised that

Markets

Conflicting information on the state of Zambia’s finances continues to emerge and new finance minister – Situmbeko Musokotwane should rise to the challenge and clear the air on what the actual and detailed status of Zambia’s treasury is. Is it a cash flow problem or an revenue problem?

Newly inaugurated President Hakainde Hichilema told the nation and international media via BBC that he has inherited an empty treasury. Within the same space of time, government main revenue generator – the  Zambia Revenue Authority (ZRA) stated in their scheduled update that they have exceeded their revenue collection target after having collected K59.450 billion against the annual target of K59.369 billion for 2021.

ZRA went on further to state that the Authority has exceeded the revenue collection target with four months to spare before the end of the year And that the Authority has refunded K7.846 billion mainly to the mining sector.

During the Monetary Policy Committee update, the Central Bank Governor Christopher Mvunga stated that the country’s reserves have crossed five months import cover and reached US$2.9 billion. A check also with government biggest expenditure line shows that the payroll was made on time and all civil servants are being paid on time.

A check on the market has also confirmed that there is a Kwacha liquidity challenge which if not arrested on time, will spiral out of control. The Kwacha is just from recording a 30% appreciation within a period of about four weeks.

This scenario then saw opposition Patriots for Economic Progress – PEP leader Sean Tembo accuse President Hichilema of putting out a statement that the treasury is empty “as political” to avoid being held accountable for campaign promises such as provision of free education from primary to university.

So, which is which? Which coffers are empty? Is it control 99? What is it? There is need for a more comprehensive report on Zambia’s financial position and the Finance Minister should come through and clear the air. There is need to have a clear view so that both local and foreign investors can have a sound basis for taking financial decisions.

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Conflicting information on the state of Zambia’s

Markets

The Bank of Zambia (BOZ) says it is aware of reports of cash shortages and has instituted a thorough analysis and investigation at some of the banks and areas where there is a higher demand for cash in order to ascertain where the huge demand for cash is coming from.

In response to a Zambian Business Times enquiry, BOZ Deputy Governor-Operations Dr. Francis Chipimo said there has been a big increase in demand for cash from the financial sector since the beginning of the year, which increased further in August.

Speaking at the Monetary Policy Committee Announcement and Press Briefing, Dr. Chipimo said the central bank has been providing banks with more cash in order to deal with the issue and has always emphasized on the fact that banks need to manage cash better.

He said the Bank of Zambia does not impose limits on what banks can give to their clients but always tries to understand why large withdrawals of cash are made when the central bank has been trying to promote the use of all other means of digital financial services, transfers and mobile money. He stated that the Bank of Zambia had received complaints that some banks have run out of cash.

In further response to the ZBT question, BOZ Governor Christopher Mvunga noted that the country is now going through the crop-purchasing season and some farmers are in areas where banking facilities are not available therefore, as cash is dispatched to farmers for purchases it takes longer to come back into the banking system.

Mvunga said the bank has not limited note circulation or implemented any limits and does not intend to do so adding that the temporal situation is being addressed and is confident that the issue would be sorted out by Friday.

On the question of why only lower denomination notes were available which has resulted in inefficiencies and higher ATM fees for customers?, BOZ Assistant Director in the Banking and Currency Department Raphael Phiri said the central bank has consistently tried to ensure that there is a balanced denominational mix within the economy.

He noted that there is no shortage of K50 or restrictive K100 bank notes but the bank tries to ensure that there is a denominational mixed balance in the economy.

He said the central bank works with all the banks to ensure that sometimes they are able to use the market itself to move money from banks sitting with excess balances to other banks as opposed to going to the central bank.

Phiri mentioned that the central bank supplies most banks with money on a daily basis in order to be able to meet the demand in the economy.

Sources in the banking sector however have told ZBT that the central bank is simply not meeting cash orders from financial services providers. The Central bank need to come out clean as they know the real reason why we have a cash shortage, a source who is not authorized to speak publicly told ZBT.

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The Bank of Zambia (BOZ) says it

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FNB Zambia has cut Automated Teller Machine (ATM) withdrawal fee for its customers using other Bank ATMs from the current K20 to K11 per transaction with effect from Friday 3 September 2021.

This has been necessitated by the cash challenges being experienced at some of the FNB’S ATMs in the country. A check by the Zambian Business Times – ZBT has however revealed that almost all banks are experiencing cash shortages.

FNB Zambia Head of Strategic Marketing and Communications Kasali Mwaba Kaingu told the Zambian Buisness Times – ZBT that this would be for a two-week period only. Kaingu said the bank would waive the withdrawal fee entirely for customers with a bundled account.

She said the Bank was aware of the cash challenges being experienced at some selected FNB ATMs and was working with the regulators and other stakeholders to ensure that this is resolved as soon as possible to avoid inconveniencing its customers.

“While we do our best to resolve this industry-wide challenge, we encourage our customers and stakeholders to make use of our digital banking channels that include Mobile and Online banking services, CashPlus agencies across the country, the FNB App and FNB Debit Card to transact and make purchases.

These alternative options are convenient and safe, and they help avoid the risks that come with cash handling,” Kaingu said. She said customers that they could also instantly increase daily limits to manage online transactions using the FNB App or from an FNB branch in their vicinity.

Kaingu said the Bank would continue to monitor the cash situation with a possibility of extending should the cash challenge persist.

A random check by ZBT in Lusaka and Kitwe , Zambia’s two largest cities by population has revealed growing frustration among ATM users for various banks which has seen some banks resorting to switching off their ATM networks as they can no longer sustain the cash needs due to shortages of the Kwacha on the market.

ZBT had asked the central bank – BOZ during the Monetary Policy Committee media engagement on why this situation has emerged, the BOZ team stated that they are aware of the situation and that the shortage would normalize by Friday 3 September 2021.

 

 

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FNB Zambia has cut Automated Teller Machine

Markets

ZAMBIA’s international gross reserves have increased to US $2.9 billion by the end of August, 2021,representing 5.4 months of import cover, from US $1.2 billion three months prior, the highest level since 2015, BoZ data shows.

And the kwacha appreciated by nearly 30 per cent against major currency convertibles between July 1 and August 31, this year, mainly boosted by significant inflows from non-resident investors in government bonds and improved market sentiments.

Speaking during the Monetary Policy Rate (MPR) announcement in Lusaka, September 1 attended by the Zambian Business Times – ZBT, Bank of Zambia (BoZ) governor Christopher Mvunga announced that the rise in the country’s reserves was largely triggered by the International Monetary Fund (IMF) Special Drawing Rights (SDRs), which led to the injection of around US $1.3 billion.

SDRs are the IMF’s reserve asset, and are exchangeable for dollars, euros, sterling, yen and Chinese yuan or renminbi.

An allocation of SDRs requires approval by IMF members holding 85 per cent of the total votes, with the United States holding 16.5 per cent of the votes, meaning that Washington D.C.’s view is decisive.

IMF Managing Director, Kristalina Georgieva, stated in early August that the much-needed liquidity came at the right time for the global economy, which was reeling from the Coronavirus pandemic.

The IMF Board of Governors approved a general allocation of SDRs equivalent to US $650 billion or around SDR 456 billion on August 2, 2021, to boost global liquidity.

Zambia’s reserves have since benefited from the increased SDR allocation, which took effect, August 23, with the country’s reserves now sitting at nearly US $3 billion, representing around 5.4 months of import cover.

“Gross international reserves rose to US $1.4 billion (equivalent to 2.6 months of import cover) at end-June, 2021, from US $1.2 billion (2.1 months of import cover) at end-March, 2021. At end-August, 2021, international reserves rose further to about US $2.9 billion (5.4 months of import cover) following the receipt of the IMF SDR937.5 million allocation (US $1.33 billion) as well as market purchases. BoZ net purchases amounted to US $154.4 million in July and August,” said Mvunga during the quarterly brief.

According to BoZ data seen by ZBT, Zambia’s reserves had earlier dropped to US $1.2 billion by the end of last year, the lowest-ever on record.

The country’s reserves drastically dwindled since 2016, precisely in tandem with Zambia’s escalating external debt stock and correspondingly high debt servicing, which put tremendous pressure on the reserves.

The last time the country’s international gross reserves dropped to below US $2 billion before 2016 was in 2009 when BoZ data revealed that reserves held were at US $1.9 billion in December of that year. Zambia’s reserves, however, peaked at over US $3.9 billion in July, 2015.

International reserves are any kind of reserve funds, which central banks can pass among themselves, internationally, and they remain an acceptable form of payment among these banks. The Gold reserves balances however remains low and this may be attributed to apathy from the responsible officials at BOZ who are not aggressively growing this line.

And the kwacha rallied against major currency convertibles by almost 30 per cent between July 1 and August 31, this year, mainly boosted by significant inflows from non-resident investors in government bonds and improved market sentiments.

“…Recently, the kwacha has appreciated sharply mainly due to significant inflows from non-resident investors in government bonds and improved market sentiments. Between July 1 and August 31, 2021, the kwacha strengthened by 29.6 per cent to K15.94 per US dollar,” stated BoZ.

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ZAMBIA’s international gross reserves have increased to