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Tech

National Institute of Public Administration (NIPA) and Smart Zambia Institute (SZI) have signed a Memorandum of Understanding (MOU) to improve Information Communication Technology (ICTs) infrastructure, which will directly translate into Zambia enjoying some of the benefits of the globalised economy.

NIPA Executive Director Prof. Royson Mukwena said training of public sector employees, the private sector and the general citizenry is an investment in human capital and contributes to sustainable industrial development.

Mukwena said NIPA agrees with Smart Zambia’s goals to build capacity in the country’s local human resource in the areas of ICTs so that the nation cuts down on expenditure spent to hire foreign expertise to respond to the country’s ICTs infrastructural requirements.

Speaking during the signing ceremony, which took place at Government Complex in Lusaka at the SZI Office today, he said ICTs will make the public sector more responsive and adaptive to global trends.

He also said the MoU would contribute to incorporation of ICTS in the area of Climate Studies and Disaster mitigation at NIPA, citizens’ capacity building in ICTS, capacity building and training of public service employees in ICTS and ICT consultancy at higher level to ministries, provinces and other spending agencies (MPSAS) and other institutions.

He said it would also contribute to scientific and applied research including software and system development projects, workshops/seminars and community service, internship/industrial placement, exchange and sharing of study reports and sourcing masters and doctoral scholarship and fellowship in e-government and computer/it fields and others.

Speaking at the same function, Smart Zambia Institute National Coordinator, who is also Deputy Secretary to the Cabinet, Dr. Martine Mtonga said improving ICTs infrastructure is an effective and efficient way of running the country’s economy.

He added that digitalisation of the economy promotes the livelihoods of citizens at various levels of society.

He also noted that the MoU between the two institutions was timely as it was a mode of closing up the existing digital divide in the country and ensure optimal usage of ICTs and e-Services by the Citizens.

“Through the development and implementation of the Government Service Bus (GSB), Government through SMART Zambia Institute provides an opportunity for Citizens to access government services effortlessly and in a more effective and efficient manner and therefore spurring social economic development for the citizens and the nation, he said.”

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National Institute of Public Administration (NIPA) and

Lifestyle

The University of Zambia (UNZA), one of Zambia’s highest learning institutions says it is on course to finding a local treatment solution for the corona virus and will have results that will be presented to both the Ministry of Health and the public by April 2020.

Speaking in an exclusive interview with the Zambian Business Times – ZBT, UNZA School of Natural Sciences Lecturer and Researcher Dr. James Nyirenda who is also the task force leader said the institution has received the cells, which will be tested to see if they are able to destroy the virus.

Dr. Nyirenda said once the results are ready, they will be presented to the funders adding that it will be up to the policy makers to make the final decision depending on the findings of the tests that will be done.

He expressed happiness that the cells used for testing had arrived as there were some challenges in acquiring them due to Covid-19 travel restrictions and most flights could not reach the country.

He added that as a public university, it does subscribe to public procurement procedures and one of the procedures took long thereby delaying the arrival of the cells noting that all that is left to do is complete the paperwork before testing can begin.

“We are trying to sort out one or two things in terms of protocols for experimentation, the reagents that came need to be tested now, to see if the cells are capable of destroying the virus, they are supposed to be pure compounds and since Zambia doesn’t make pure compounds, we had to import them, he said.”

“Tests need to be done in order to see what works and what doesn’t, what works, we concretize and proceed with the same research to see if there can be mass production”, he said.

He noted that the research has two components, which are natural products and conventional drugs adding that conventional drugs are already in existence so it is just a matter of advising the public on which drugs do work and drugs that are thought to be working that do not.

“Natural products do not use scientific proof so that is the science we are trying to prove or provide to those traditional plants, because we use indigenous knowledge system, these are knowledge systems where somebody just says this tree works, but there is no proof, so we are trying to experiment and come up with facts, he said.”

He said he and his team has continued to perform more tests to see whether these drugs work and if not, he will be able to give scientific and expert advice to the public. “With science, we work with facts, we work with reality and test something, we are testing cells so we have to prove emperically that certain medicines that have been talked of really work or not as well as certain natural products, he said.”

Concerns on the timeline for certifying local treatment of Covid have continued to be postponed due to lack of local capacity and compounds to conduct independent tests.

Concerns have also arisen as to whether the country will be able to independently test the vaccines that have been allocated to Zambia following concerns around the possibility of abuse of vaccines. Advances in Science and technology remain a major challenge for Zambia and most African states which have rendered efforts to catch up on development difficult.

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The University of Zambia (UNZA), one of

Mining

The Industrial Development Corporation (IDC)m the parent or holding company of ZCCM-IH has clarified that the US$1.5 billion debt accrued after the buy back of Mopani Copper Mines from Glencore and FQM does not add to Zambia’s sovereign debt.

In a statement issued to the Zambian Business Times – ZBT, IDC CEO Mateyo Kaluba stated the that “the payment of the US$1.5 billion transaction debt by Mopani to Glencore was the burden of the mining company itself [Mopani] and not the State. He added that the mine’s debt as a result of this transaction had no impact on the country’s sovereign debt.

And the IDC CEO further stated that ZCCM-IH has the capacity to efficiently operate Mopani Copper Mines. Kaluba said the mining company’s Board of Directors and Management would be competent enough to professionally run the newly acquired mine.

“In terms of our confidence that the mine will be professionally run, we have no doubt,” He added that the company would further seek a strategic equity and technical partner to enhance its capacity. He reiterated that the acquisition of Mopani Copper Mine by ZCCM-IH was consistent with the direction the mining conglomerate was taking to have more control of mining interests in the country.

On questions about who was involved in the deal process, Kaluba said the IDC, as ZCCM-IH’s holding company, was involved through an extensive consultation process to give the necessary guidance and approvals.

He explained that the deal was structured in such a way that Glencore would be the off taker of Mopani’s copper and that a 10% portion of the proceeds would go towards debt repayment. He said the debt would be fully paid over the next 10-17 years depending on the mine’s production capacity and fluctuations of the copper prices.

Kaluba urged Zambians to be more confident in taking up more challenging assignments, as the government had created an enabling environment where companies such as ZCCM-IH and IDC are able to be more assertive in taking control of national assets.

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The Industrial Development Corporation (IDC)m the parent

Mining

Yesterday, we as Zambian Business Times – ZBT carried an article which gave the information on the buy back of Mopani Copper Mines by ZCCM-IH, the erstwhile owners before the privatization.

The full details of the transaction are yet to be fully availed, with some high level details being availed by each party to the transaction. ZCCM-IH chairman Eric Silwamba stated that a more detailed note will be issued to meet listing disclosure requirements under the Lusaka Securities Exchange – LSE in the next few days.

The beauty of this transaction this time around is that all the parties to the deal from ZCCM-IH, Glencore and FQM are all listed on different security exchanges which all have at least some higher levels of disclosure requirements. This is perhaps the biggest benefit and the reason why we as ZBT continue to advocate for listing of more state owned enterprise – SOE’s.

We have seen and we expect that each party to this transaction is carefully managing their stakeholders and releasing information strategically to assures its key stakeholders that they have done a good deal. But as the saying goes, the devil is in the details.

Below is the statement issued by Glencore dated 19 January 2021 availed to ZBT. We reproduce it verbatim below:

Glencore today announces that its subsidiary Carlisa Investments Corp. (“Carlisa”), in which Glencore holds 81.2% of the shares, has signed an agreement with ZCCM Investments Holding plc (“ZCCM”) to transfer its 90% interest in Mopani Copper Mines plc (“Mopani”) to ZCCM, the owner of the remaining 10% interest in Mopani, for US$1 and the Transaction Debt (as defined below).

Completion of the sale is conditional on receipt of certain regulatory approvals in Zambia and on the approval of the shareholders and board of directors of ZCCM, and is expected to occur within the next three months.

Mopani has been funded by borrowings from Carlisa and other members of the Glencore group. On completion, US$1.5 billion of debt (the “Transaction Debt”) will remain owed by Mopani to Glencore group creditors on the following terms:

a. interest under the Transaction Debt will be capitalised for the first three years after completion, and thereafter will be payable quarterly at LIBOR + 3% (subject to a switch to an equivalent interest rate based on SOFR); and

b. principal outstanding under the Transaction Debt will be repayable under a dual mechanism whereby:

i. 3% of gross revenue of the Mopani group from 2021-2023 (inclusive), and 10-17.5% of gross revenue of the Mopani group thereafter; and

ii. 33.3% of EBITDA less tax, changes in working capital, capital expenditure, royalty payments and interest and principal (calculated under the first mechanism) payments in respect of Transaction Debt, is at the end of each quarter required to be paid. Repayment of principal (together with accrued interest) may additionally be required in the event of an occurrence of certain other early prepayment events, including certain change of control events in respect of Mopani.

After completion of the sale, Glencore will retain offtake rights in respect of Mopani’s copper production until the Transaction Debt has been repaid in full.

As ZCCM is the holder of 10% of the voting rights in Mopani, a subsidiary undertaking of Glencore plc, the transaction falls within the criteria set out in Listing Rule 11.1.10R. Accordingly, Glencore has obtained written confirmation from a sponsor that the terms of the transaction are fair and reasonable as far as Glencore shareholders are concerned.

To get a rounded view of the transaction, you also need to look at what FQM has posted, what out for from ZBT. We are of the view that after reviewing the transaction and information shared by all the three parties, it is from there that we can then make a more informed inquiry…

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Yesterday, we as Zambian Business Times -

Companies

The Zambia Revenue Authority (ZRA) tax refunds have jumped up by 12.3% year on year despite the earlier indication that tax audit of mines and related other entities would curb the drain.

Further, ZRA has failed to meet its K59 billion revenue collection target that was set for the 2020 financial year, registering K1.3 billion or 22 percent below the annual target.

This below target performance by ZRA is further exacerbated by the fact that the Zambian Kwacha has depreciated by over 60% within a year. Meaning that the Kwacha tax collections value has lost a further 60% of value or purchasing power internationally, if used to pay for US dollar or forex denominated government spend.

ZRA Commissioner General Kingsley Chanda said the authority collected K57.7 billion last year 2020, which represents 17.7% of the Gross Domestic Product (GDP) compared to 17.8% in 2019. The global benchmark for an efficient tax collection system is collection of 18% of GDP.

However, the ZRA Commissioner General defended his institutions performance stating that “the performance is highly commendable because revenue collection was a difficult undertaking in 2020 due to the unfavourable economic conditions that prevailed during the year including the outbreak of the covid-19 pandemic, which put a strain on public resources and economic activities”.

And the revenue target for 2021 has remained flat with no notable stretch added, largely maintaining the target that was set for 2020. ZRA has been given a tax revenue collection target of K59.3 billion for the year 2021 adding that it will be difficult to achieve its set target due to the continued effects of the covid-19 pandemic on the economy.

Chanda further clarified said this [below target] performance relates to taxes collected by ZRA only and does not include revenues collected by other government departments in form of non-tax revenue and other fees noting that the Ministry of Finance will at an appropriate time and in line with its mandate give a brief on the revenue collected outside ZRA.

Chanda said the authority paid out K12.9 billion in terms of tax refunds compared to K10.5 billion, which was paid out in 2019 representing a 12.3% growth in tax refunds adding that of this amount, K12.64 billion was paid in VAT refunds of which K8.5 billion was paid out to the mining companies.

He added that direct taxes refund stood at K72.3 million while K163.5 million was paid in customs refunds. He said the increase in the amount refunded in 2020 is in line with the authority’s desire to dismantle all its outstanding tax refunds especially VAT adding that this remains one of the key operational priorities for ZRA and government.

He said the fiscal incentives announced by the government, which were aimed at containing the spread of the virus and had put the economy on the road to recovery, had a chilling short-term effect on revenue mobilisation.

In response to the disruptions to the economic fundamentals, government revised its 2020 tax revenue projection downwards from the K59 billion, which was approved. Chanda said this during a media briefing that was held in Lusaka on January 13, 2021.

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The Zambia Revenue Authority (ZRA) tax refunds

Tech

National Action for Quality Education in Zambia (NAQUEZ) has advised government to reform the grade seven examinations, as they are currently not serving any meaningful purpose. The exams can be reformed in such a way that they start to determine or be used as as sessement for who goes through the academic route or vocational route.

NAQUEZ Executive Director Aaron Chansa said it is currently a waste of time and resources to have pupils sit for grade seven examinations because whoever sits for the exams proceeds to grade eight whether they obtain good marks or not.

In an exclusive interview with the Zambian Business Times – ZBT, Chansa said he does not agree that the exams must be abolished but instead they should be reformed, adding that school based assessments are supposed to be there but must run side by side with the final examinations.

Chansa said there is need to re-introduce the cutoff point and anyone say, who gets below 600 out of 900 should be required to repeat or if they are vocationally talented, they need to be allowed to proceed and use the vocational pathway.

“In as much as we agree with the Permanent Secretary, Jobbicks Kalumba, that in its current form, the grade 7 exams are doing nothing because anyone who sits for them is allowed to go to the next grade, even if they get 20 marks out of 900 marks, we are of the view that they should not be abolished, he said.”

He said the curriculum says that grade seven exams should be a departure point for learners who are academically gifted and those who are vocationally tailored, so the exams should be reformed to speak to that policy direction.

He added that there is need to reintroduce the cut off point and minimum points should be say 600, so that only those that meet the cutoff point can proceed to grade 8 and those who want to follow the skills or vocational pathway should be given that opportunity so that we don’t have grade eights who cannot read and write.

He noted that if reforms are not instituted, there will be need to call for the abolishment of these exams. Chansa said the current policy is not beneficial to pupils because even those who are not academically gifted are forced to be in an academic class, when they are supposed to be in a vocational class, which is not good because not everyone is academically oriented.

Ministry of General Education Permanent Secretary Jobbicks Kalumba is of the view that grade seven examinations should be abolished because they are a cost to government. Some private schools in Zambia already have a pathway we’re grade seven exams are not attempted with progress being made through the school assessment systems.

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National Action for Quality Education in Zambia

Mining

ZCCM-IH, an investment arm of the Zambian government under the Industrial Development Corporation- IDC has acquired majority stake and retained ownership of Mopani Copper Mines – MCM.

In a statement availed to the Zambian Business Times – ZBT, MCM public relations manager Nebert Mulenga has confirmed that Glencore has sold its majority stake in Mopani to ZCCM-IH following the conclusion of the shareholding discussions.

He further stated that ZCCM-IH has been a shareholder in Mopani for over 20 years and is well placed to build on the significant investment undertaken by Glencore to help position Mopani as a Zambian copper champion.

Mulenga stated that “the shareholding transfer process is expected to be formally completed by the end of the first quarter of 2021. Glencore will continue to be in operational and financial control while the handover formalities are being undertaken by the involved parties”.

And ZCCM IH board chairman Eric Silwamba stated that ZCCM IH has acquired 90% shares in Mopani Copper Mines which were previously held by Glencore (73.1%) and First Quantum Minerals (16.9%), in line with ZCCM IH strategic plan to increase its holdings in existing mining firms.

Silwamba further stated that Mopani Copper Mine underground operations in Kitwe have a remaining life of 26 years and 16 years for Mufulira based Mines, with 110 million tons of proven copper ore reserves, with 1.89% of Copper grade.

And Mines Minister Richard Musukwa stated that this move has saved over 15,000 jobs as Glencore had intended to place the Mine on care and maintenance. He stated that the salient features of the transaction is that Mopani loans were US$4.8 billion to its group companies i.e Glencore Bermuda, Glencore International & Carlisa Investments and has been agreed to be reduced to US$1.5 billion.

The reduced loan of US$1.5 billion is to be paid back by Mopani to Glencore through an off taker agreement. Mopani will pay via 10% of production in the period of 10 to 17 years depending on the price of Copper.

Glencore had earlier announced that they were in discussion with the Zambian authorities and ZCCM-IH to sell out their stake after their relationship deteriorated. This was after the Mine had gone ahead to close the Mine without following the laid down procedures.

Mopani has Mines based in Zambia’s second largest city by population – Kitwe and in Mufulira, another key mining town on the Copperbelt. This is the second Mine after Konkola Copper Mines – KCM to be acquired by the Zambian authorities a-bait in a more negotiated manner.

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ZCCM-IH, an investment arm of the Zambian

Tech

The Energy Regulation Board (ERB) says there will be no fuel price reduction in the short to medium term as a result of the Zero rating or removal of Value Added Tax (VAT) on fuel. Instead, the zero rating of VAT has provided room that has been utilized to avoid an eminent fuel price hike.

The announcement of the removal of the 16% VAT on fuel had created excitement especially among the general public as it was expected to be passed on to the final consumers and industrial users. However, the depreciation of the Kwacha and the increase in international crude oil prices have negated the passing of the benefit to final consumers.

ERB Communications Officer Mwila Kombe told the Zambian Business Times – ZBT that the current pump prices have been maintained even when they could have been increased due to adverse movement in economic variables that influence petroleum pump prices such as the depreciation of the kwacha against major convertible currencies augmented by increased international crude oil prices.

According to information made available to ZBT, Kombe said government has continued to promote renewable energy in order to diversify the energy mix and reduce dependence on fossil fuels. She said government has put in place interventions such as the introduction of the 2019 national energy policy which provides for the development of bio-fuels.

She added that the regulator has also maintained the Statutory Instrument – SI No.42 of 2008 which provides for the declaration of bio-fuels as an energy source under the energy regulation act adding that, blending ratios (2011) at 10% for bioethanol (E10) and 5% for biodiesel (B5) are some of the interventions aimed at reducing dependence on [imported] fossil fuels.

Subsequently spiral effects on increased cost of fuel have also been averted such as the resultant increase in prices for goods and services and also in the increase in transportation costs.

When asked on regulatory measures to help cut the fuel import bill which is one of the major drainers of forex in Zambia, Kombe told ZBT that ERB which is mandated to provide regulatory overview of the energy sector provides a conducive environment for the production of biofuels by coming up with interventions such as development of the biofuels regulatory framework (2016) for licensing minimum production capacity is 2,000 litres/cubic metres per day.

She mentioned that other interventions include the development of the biodiesel fuel blends for automotive compression ignition engines and ethanol fuel blends for automotive spark ignition engines.

She also noted that the biodiesel fuel blends and ethanol fuel blends covers specification for motor gas oil (diesel) blended with 5% biodiesel and motor gasoline (petrol) blended. with 10% ethanol. These provide an avenue for cutting the fossil fuels import bill.

Biofuels are perhaps Zambia’s best bet to cut the fuel Import bill through the cultivation of biofuel plants locally. A cassava biofuel project in Luapula has been launched but we are yet to see if its projected production levels will be realized.

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The Energy Regulation Board (ERB) says there

Lifestyle

The United Kingdom – UK stands to lose more than Zambia economically following the recently announced travel ban to and from Zambia, according to the Economic Association of Zambia – EAZ.

The UK recently issued a travel ban to and from Southern African countries, Zambia inclusive because of the second wave of covid, a move that has left some Zambian citizens concerned more especially on the resultant impact on businesses as well as Zambia’s economy in general.

In an exclusive interview with the Zambian Business Times – ZBT, EAZ President Dr. Lubinda Haabazoka stated that “Any restriction in the movement of people might have an effect on the movement of goods and capital between two countries and definitely the travel ban will have a negative impact on both countries.”

However, Haabazoka disclosed that, the UK is [currently] not a significant trade partner to Zambia and as such, people should not expect huge negative impact on Zambia’s economy.

He also added that trade between Zambia and the UK is one sided as it’s mostly the Zambian people and businesses who are usually buying things from the UK on such platforms as Ebay which are then shipped into Zambia.

Haabazoka said that the ban will have limited affect on Zambia because its major trading partners are China and South Africa, thus it’s the UK that stands to lose out more on this ban.

Haabazoka said that “it’s very unfortunate that the UK decided to issue a travel ban on Zambia when it should be the other way round, because it’s public knowledge and everyone is aware that the second wave started from the UK. Their cases are very high compared to Zambia.

The UK government stated that “From 4am on Saturday 9 January, visitors arriving into the UK who have been in or transited through Zambia in the previous 10 days will not be permitted entry. British and Irish citizens, and third country nationals with residence rights in the UK arriving in the UK from Zambia need to self-isolate on their return”.

Other southern African countries apart from Zambia and South Africa currently included on the banned list include Namibia, Zimbabwe, Botswana, Eswatini, Malawi, Lesotho, Mozambique and Angola — as well as Seychelles and Mauritius.

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The United Kingdom - UK stands to

Companies

The Engineering Institution of Zambia (EIZ) says it is working on coming up with standard rates for services that its members can use across the country in line with professional services best practices. The proposals is expected to be presented to government in three months.

EIZ President Abel Ng’andu said a committee is currently working on a proposal aimed at coming up with standards rates that it’s various members and the end users can utilize as a guide. He stated that the proposal will after consultation, be present to the Ministers of Infrastructure, Development and Housing for further consideration within three months.

In an exclusive interview with Zambian Business Times-ZBT, Ng’andu said this is a long overdue process adding that the committee will come up with a draft, which will first be circulated among members. The members will look at the proposals and give feedback, and once the members are satisfied, it will be sent to the relevant ministers for further consideration.

Ng’andu said this will prevent clients from being exploited, adding that that is why the process has to go through the minister because the he represents the public and will be able to look at rates and decide whether the fees are economical, sustainable and fair to the users of the services.

“It is a long process, it’s not something that can be done overnight or in a couple of months, it will take some time. It’s likely that there will be input from other stakeholders as well, not only the ministry, most likely they will invite other stake holders who have a strong interest in those services so that they can share their views, it has to go through a consultative process, he said.”

Ng’andu said coming up with standard rates would mean that the client cannot be exploited and the people who will be doing the work will be doing the work at a pace that will enable them to deliver excellent services.

“You have standard rates for doctors, in the hospital when you go for consultation you pay a particular rate for a doctor, that is the same spirit that we want to follow because if you were going to pay a doctor say K10 as consultation fee, we wouldn’t have too many medical doctors, he said.”

He said the committee would look at the value for money and not whether the rates are too low or too high but will come up with rates that guarantee quality and value for the money the end user will be paying.

The coming up of standard rates for various engineering and related craft services will enable price discovery in the Zambian construction and engineering sector which has been marred by accusation and counter accusations of corruption due to an opaque pricing system.

Standard professional services rates will help to set a guide that would remove the opportunity for corruption or in other incidences, perceived corruption. It will also go a long way to provide a yardstick for review and audit works.

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The Engineering Institution of Zambia (EIZ) says