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Markets

Lusaka based prominent economist Yusuf Dodia has described the sacking of the Bank of Zambia Governor Dr. Denny Kalyalya as shocking.

Dodia, Speaking to the Zambian business times – ZBT in an exclusive interview stated that it is shocking to the country that the Governor of the Bank of Zambia has been removed with an “immediate effect” condition.

President Edgar Lungu had on Saturday 22 August 2020 termited the contract of the Governor of the Bank of Zambia Dr. Denny Kalyalya with immediate effect. President Lungu further announced the appointment of Deputy Secretary to cabinet – finance and economic development Christopher Mvunga as the new Bank of Zambia Governor subject to ratification by the national assembly.

President Lungu further announced that Ministry of National Development planning director for development planning, Dr. Mike Masiye has been appointed as deputy secretary to the cabinet- finance and economic development taking over from Christopher Mvunga.

Yusuf Dodia stated that Dr. Kalyalya has been a focused economist, banker and a very dedicated contributor to economics in this country. He has worked at the Bank of Zambia for many years and has been through many ranks to be able to understand the operations of the central bank.

Moreover, one would have thought that Dr. Kalyalya would have been in good place to be able to resolve the challenges we have with international debt that is around US$11.2 billion dollars and Zambia’s domestic debt that is around K80 billion.

We are going through difficulties with a runaway exchange rate where we are seeing our Kwacha continuing to weaken against the US dollar, with an escalating inflation rate in our country, which is around 17%. Zambia is also engaged in negotiations with IMF to get a financing packaging for for the country.

Dodia stated that it would be prudent to have a seasoned Governor of the Bank of Zambia to insure that we get through the difficulties in a smooth and strategic way. Nonetheless, jobs are not there to be held by one person for life, Dr. Kalyalya has served in that position for almost 6 years.

The coming in of Mvunga to take over as Governor of Bank of Zambia is something which will be a big burden on his shoulder, because his taking all these challenges.

Mvunga’s background working in the ministry of finance, at cabinet office and as a Banker with Standard Chartered is quiet useful in understanding the machinery of government and it remains to be seen how the Bank of Zambia fits into this whole arrangement of banking.

Moreover, it is going to be a difficult task. Dr. Kalyalya had a difficult job and Mvunga inherits this equally difficult job. We can only wish him well.

Dodia’s advice is that there are a lot of technocrats at the Bank of Zambia. It is one institution with adequate technical expertise. In addition, good leadership means the Governor should use his human resources to the best of their abilities to ensure that they are all saving the people of Zambia in the best way possible.

It is really a team building challenge that is required at the Bank of Zambia in order to ensure that this country goes through these difficult periods with as little negative impact as possible. We begin to build a positive future in the years to come.

The sacking of Dr. Kalyalya has raised suspicion that something may have triggered it. According to sources at Bank of Zambia, he was due to complete his send three year contract in the next few months but he has been sacked even with a few months remaining.

There is more than meets the eye. It was much easier to simply let the contract run out and not renew it than to terminate his contract with immediate effect. There is definitely a trigger somewhere.

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Lusaka based prominent economist Yusuf Dodia has

Agribusiness

Nitrogen Chemicals of Zambia – NCZ has announced the appointment of William Mwale as its new Chief Executive Officer – CEO.

The board of directors of NCZ announced the appointment of William Mwale as CEO on 27 August, 2020. In a statement availed to the Zambian Business Times – ZBT, Board Chairperson Dr. Chitundu Kasase, told Mwale to turn around NCZ as he has the requisite expertise and skills.

Dr. Kasase stated that prior to his appointment, Mwale worked as the interim NCZ CEO, on secondment from Indeni Petroleum Refinery Limited. The new CEO has more than 20 years of experience in processing plants having worked at Indeni Petroleum Refinery Limited, Water Engineering Limited and at Lafarge Zambia.

The board has urged Mwale to turn around the company into viable commercial enterprise by driving transformation from within, particularly in areas of cost reduction, innovation, market repositioning and internal restructuring.

Dr. Kasase assured Mwale that the board will render its full support to continued growth of the business and to ensuring that NCZ rebuilds its brand and strategically re-position itself as a premier fertilizer and chemical manufacture.

In addition, the board is confident, that with this appointment, the growth trajectory that NCZ has embarked on will be sustained.

NCZ has experienced challenges to source for financing to revamp and update its fertilizer and Chemical manufacturing plant and technology owing largely to unbridled competition from imports.

Zambia in October and November 2019 experience steep depreciation of the Kwacha following massive imports in both fertilizers and fuel. This scenario has prompted stakeholders to look at viable ways to stem forex outflows by re-energizing local fertilizer and biofuel production.

Concerned citizens have however warned that the current importers and transporters of fertilizers are working flat out to frustrate efforts to successfully increase local production.

Mwale has a daunting task to first secure financing to upgrade the NCZ manufacturing plant before he and the NCZ management team can look to challenge the lucrative import trading in fertilizers. It remains to be seen if Mwale will be able to make a difference.

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Nitrogen Chemicals of Zambia - NCZ has

Markets

Finance Minister Dr. Bwalya N’gandu has been challenged to cancel all skewed colonial tax treaties, some of which were signed before independence and include the need for a programmed or periodic review of all double taxation agreements in place.

Zambia has been noted to be among the developing countries in Africa which have signed one way tax treaties with developed countries which have frequently led to massive revenue losses for the country from the exploitation of its massive God endowed mineral wealth and other resources.

The Zambian government confirmed that it had begun to review some of the Double Taxation Agreements – DTA’s with countries such as Netherland and Ireland. But a review conducted by the Zambian Business Times in conjunction with Action Aid has revealed that this is one of the major high risk high return areas that the country needs to attend to.

There are some countries in Europe and North America that should particularly be reviewed as they are being used as conduits for transfer pricing and profit repatriation. Zambia still has some agreements that date back to as far as 1959. There government has enough technocrats that can review all these agreements and ensure that only those that are in the collective interest of Zambia are retained.

ActionAid Zambia has since expressed disappointment at such unfair agreements which carve up taxing rights and impose more limitations on the taxing rights of developing countries than on the taxing rights of developed countries.

Sometimes we heap the blame on the Zambia Revenue Authority, but its the Ministry of Finance that issues and get tax policies ratified by the National Assembly. This review therefore should be done by the ministry of Finance and related bodies like Attorney Generals office.

And ActionAid Zambia Tax specialist Musonda Kabinga told the Zambian Business Times – ZBT in an exclusive interview that resources that Zambia is losing through poor tax treaties should instead be channeled to funding Zambia’s development agenda and for poverty reduction measures.

He said agreements which were signed before or soon after Zambia gained independence are based on outdated models hence the need to review and renegotiate outdated treaties to ensure Zambia’s right to tax is not unfairly constrained.

“In order to raise more investment for the government to deliver effective public services delivery, we recommend that government should review and redraft all outdated agreements signed before Zambia got independence and should ensure that any tax treaty entered into does not include MANDATORY BINDING ARBITRATION,” He said.

He added that DTA’s should also be negotiated transparently and ratified by parliament with draft versions available for public discussion prior to signing off.

The Zambian Government recently cancelled its Double Tax Agreement with Mauritius and ActionAid Zambia welcomed the move saying it provided for 0 Percent Withholding Tax (WHT) on technical fees paid for technical services and had lost the country millions of dollars in taxes.

As students of history, we can fully appreciate that colonial and protectorate status meant that the laws were crafted in favor of the colonial masters and their interests. How do we surely have these treaties still in place today?. We now need to balance the laws to allow the country to have a credible shot at national development which needs infrustrature drive to be re-energized.

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Finance Minister Dr. Bwalya N’gandu has been

Mining

Zambia is known for its rich mineral resources, with copper as the most relied upon mineral. But the discovery of gold in Zambia has become a game changer for the country’s economy.

In a statement made available to Zambian Business Times – ZBT, Centre for Trade Policy and Development (CTPD) Senior Researcher Webby Banda has advised ZCCM-IH to align its gold trading practices to Organization for Economic Cooperation and Development (OECD).

“In as much as this is progressive, the Centre for Trade Policy and Development (CTPD) is urging ZCCM-IH to align its Gold trading practices to the Organization for Economic Cooperation and Development (OECD) due diligence guidelines on responsible mineral supply chains. The guidelines are simply guidance on how to undertake a supply chain due diligence of Gold potentially sourced from conflict-affected and high-risk areas.

The purpose of these guidelines will be to allow ZCCM-IH scrutinize the source of the Gold bought. This is to ensure that its buying process is not promoting human rights abuses and conflict in the supply chain of Gold potentially sourced from conflict-affected and high-risk areas”, he said.

Gold is easily transported and malleable. These properties make it easy for illegal dealers to melt and recast Gold with that which is mined domestically. This subsequently masks the origin of the illicit Gold. When this happens, Zambia will be seen as cumulatively perpetuating instability in high conflict countries from where this illicit Gold is sourced.

“According to the OECD guidelines, artisanal and small-scale Gold producers such as individuals, informal working groups or communities are not expected to carry out due diligence but they are encouraged to remain involved in due diligence efforts of their customers. They must be encouraged to formalize so they can carry out due diligence in the future”, he said.

Zambia has recently discovered notable gold deposits in North western, Central, eastern and parts of central provinces.

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Zambia is known for its rich mineral

Companies

The Zambia Development Agency (ZDA) has disclosed to Zambian Business Times-ZBT through a statement that they have embarked on a process of rebranding in order to re-position themselves as a more recognizable brand.

The agency has a new tagline which is called *’Potential Made Possible’* which acknowledges the massive potential that the country has in terms of Natural resources, Human resources, exports in the region and being a regional trade Hub and envisages that all these attributes are certainly catalysts for accelerated economic growth and development.

Furthermore, the agency has stressed that through the new tagline further summarizes the aspirations of the Agency and helping the country realize the great potential.

‘Through the new tagline, the Agency further encapsulates the aspirations of the Agency and helping the people the people of Zambia and the country as a whole to realize this great potential.

It is expected that the tagline will appeal to a broader spectrum of our clients and can be relatable across all levels’.

Therefore, the role of the Agency is to identify potential and help our stakeholders realize their dreams, and helping the country achieve unlimited milestones due to the comparative and competitive advantage it has.

Meanwhile the Ministry of Commerce, Trade and Industry agency says that it is not moving away from the existing brand but just enhancing the familiarity of the brand to the various stakeholders and clients.

‘With the new brand, the Agency is poised to be differentiated as a unique brand which links private and public sector and reassures our clients that our aim is to actualize dreams, ideas and potential’.

It is also focused on building an esteemed brand whose association delivers value, stand the test of time, and position ZDA as the sole implementing agency of trade and investment.

The re-branding of the Agency was necessitated the need for repositioning in line with the Institutional strategic plan in the he alignment with the 7th National Development Plan.

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The Zambia Development Agency (ZDA) has disclosed

Companies

Power utility, ZESCO has expressed concern at the alarming increase in the number of impersonators who pose as its workers and contractors when in actual sense they are not.

In a statement made available to Zambian Business Times ZBT, ZESCO Public relations Manager Hazel Zulu stated that the corporation would like to alert the general public that there is an increase in the number of people impersonating ZESCO employees and contractors.

“The Corporation has noted with concern an upsurge in schemes where some members of the public have been swindled by people pretending to be ZESCO employees and contractors purporting to offer ZESCO services such as processing of quotations, new connection applications, meter installations, meter replacement and fault resolution, at a fee.

“The public is hereby informed that ZESCO does not use agents to undertake the aforementioned services; neither does it charge extra fees to hasten the process of accessing the services. All ZESCO services regarding clearing faults and processing of quotations are FREE. Where certain services are paid for, an official receipt shall be issued at a duly recognized ZESCO Office or Customer Service Center”, she said.

Furthermore, she said that the company will not be held accountable for any losses that one may encounter from  fraudsters and has put down a list of credible source to attain services from ZESCO.

“ZESCO will not be held liable for any loss suffered by members of the public who become victims of fraud from unauthorized individuals. Members of the public are advised to report any suspicious conduct to the nearest Police Station or ZESCO offices”, she said.

Customers are therefore advised to access ZESCO services on the following platforms: National Call Centre, ZESCO Customer Service Centre, ZESCO Mobile App (Google Play Store/Apple App Store), ZESCO USSD Code *3600# and Other online platforms (Commercial banks, Kazang, Airtel, Mtn and Zamtel).

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Power utility, ZESCO has expressed concern at

Lifestyle

Stanbic Private Banking customers can now access services in the comfort of the newly built Quorum Private Banking Suite in Kabulonga effective from September 1, 2020.

The Quorum is Lusaka’s first Private Business Club conceived for discerning professionals and entrepreneurs who are passionate about networking in their businesses, their Industries allowing for growth in the Zambian economy.

In a statement made available to Zambian Business Times- ZBT, Stanbic Head Personal and Business Banking, Mwansa Mutati says the exclusive ultra-modern Quorum Private Banking Suite is part of Stanbic’s strategic objective to offer clients a superior Banking experience.

“As a Bank, we are exponentially growing, and constantly looking at better ways to serve our Customers in the most effective and efficient manner.

“Our customers are our main priority and we always strive for them to receive the best Customer experience each time they visit us. With the new location of the suite, we are confident that our Private Banking customers will continue to enjoy the Private Banking services and much more,” she said.

The new – suite is on the corner of Kabulonga Road and Martin Luther King Road in Lusaka and replaces the Taj Pamodzi Banking Suite.

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Stanbic Private Banking customers can now access

Mining

Glencore International AG, the majority shareholder of Mopani Copper Mines – Mopani has confirmed that it is in discussions with Zambian authorities regarding potential acquisition of additional shares by ZCCM IH.

Glencore Head of Communication Charles Watenphul exclusively told the Zambian Business Times – ZBT that “further to its recent disclosure that Mopani is engaging with the Zambian authorities, Glencore can confirm that it is in discussions with existing Mopani shareholder ZCCM-IH and other shareholders regarding the potential acquisition of additional shares by ZCCM-IH from Glencore. The discussions are progressing and further updates will be issued as appropriate.”

Mopani had recently had its request to put the two mines located in Kitwe and Mufulira on care and maintenance rejected for the second time by the ministry of mines. The Mine has been accused by the local Mine suppliers and contractors association of planning to relocate its procurement functions to South Africa, a move seen as a plot to further cut down on Zambian based Mine suppliers and contractors.

Analysts have questioned the true reasons behind Mopani request to place the Copper Mines on care and maintenance stating that the current reference copper prices per ton obtaining at the London Metal Exchange – LME is sufficient even for older underground Mines such as Mopani to profitable operate. 

When asked what the average price of production of copper per ton is for Mopani in Zambia, Watenphul declined to disclose stating that “we would do not disclose our production costs”. The average cost of copper production per ton against the obtaining market prices is used as a gauge to determine when operations become un-sustainable and justify the tough decision of placing the operations on care and maintenance. 

Glencore however stated in its half year report released on 6 August 2020 that “In Zambia, we have notified the government of our intention to place the Mopani mining operations on care and maintenance to help preserve the resource’s value and maintain optionality for when conditions improve. While our proposal has been rejected, Mopani has appealed the decision and we continue to engage with the relevant authorities to identify solutions on the way forward”.

Despite efforts to diversify the economy, copper mining remains the biggest contributor to Zambia accounting for over 70% of totals national exports. The performance of the copper mining and export industry in Zambia directly impacts on the country economic fortunes and wellbeing. The discovery of notable gold deposits in about three regions or provinces of Zambia promises to perhaps offer a real alternative to copper mining.

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Glencore International AG, the majority shareholder of

Tech

Zambia Information and Communication Technology Authority (ZICTA), has fined all the three mobile telecommunication companies for failing to meet the quality of service – QoS standards.

According to a statement made available to Zambian Business Times – ZBT, ZICTA Manager of corporate communication Ngabo Nankonde has disclosed that they have finned the three Mobile Network Operators (MNOs)- Airtel Zambia Plc, MTN Limited and Zamtel.

Airtel has been fined the highest amount with a total of ZMW 4.8 million for failing to meet the Qos  peremeters. Some of the specific reasons relate to poor service in Kalulushi and Lusaka, the call Drop Rate in Ndola, Chipata and Lusaka, HTTP download call set up success rate in Chipata and rate on 3G download in Chisamba

Zamtel received the second highest fine. The state owned MNO has been fined with a total of K450,000 for failing to meet the QoS parameter, i.e. Call setup success rate in Chingola, Lusaka and Kitwe and HTTP successful internet Log-ins in Chingola,Chipata and Kitwe.

MTN has been fine K225,000 for failing to meet the HTTP success internet log-in in Chipata, Ndola and Chisamba. MTN received the lowest fine of the three operating MNOs.

“In imposing these fines, the Authority took into account the MNO’s efforts to improve the quality of Service on their respective networks. The fines were imposed on the MNO’s on August 26, 2020 and a period of seven days was given within which the MNO’s should pay the fines.

ZBT had exclusively reported some lapse in the monitoring of QoS parameters in most districts which is only done periodically by “drive through process”. ZICTA further disclosed that some areas are not monitored monthly but on a quarterly basis which further confirmed the complaints coming from users in various towns and cities. ZICTA itself needs to do more and invest more to timely and efficiently monitor the quality of service across the country.

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Zambia Information and Communication Technology Authority (ZICTA),

Tech

With the raising number of COVID-19 cases in the country, companies are finding innovative ways to spread the awareness of waring a face mask to the general public. MTN Zambia is one of the companies leading the way.

In a press briefing attended by Zambian Business Times- ZBT MTN has on 31 August, 2020 launched their new campaign dubbed #WearItForMe . MTN Zambia Chief Executive Officer – CEO, Bart Hofker said that MTN has added a motherly touch in their campaign to further drive the message.

“We have included a mother figure in our campaign to reinforce the company’s message as our mothers play a big role when growing up”, he said. #WearItForMe is the next phase in MTN’s COVID-19 response under Y’ello Hope – MTN’s umbrella iniative which provides much- needed support during times of societal need.

Furthermore, MTN says as Africa and Middle East markets continue to work under the “new normal” which is caused by the pandemic, waring of a face mask continues to be one of the most effective way of slowing the spread of the virus. However, many people refuse to wear them, waer them incoreectly or fell it is not important to wear them.

The campaign will build the work already carried under Y’ello Hope to brighten lives and limit the impact of the pandemic. During this time, MTN has prioritized looking after its people, customers and communities while focusing on efficiencies to help navigate the pandemic and its effects.

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With the raising number of COVID-19 cases