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Sport

Motor Sport Association of Zambia has reaffirmed that its 2020 calendar remains suspended due to the health threats caused by the corona virus. The Association has confirmed that it has lost out on sponsorships and donations valued at over K1 million due to suspension of its activities.

Speaking in an exclusive interview with Zambia business times – ZBT, Motor Sports Association of Zambia president Sam Chingambu stated that they have cancelled some tournaments and events because they don’t want the drivers and crew the scores of people who attend the rallies to risk getting infected with the Corona virus.

He said that the Motor Sports Association also has international affiliation obligations to mother body organizations such as Federation Internationale de l’Automobile – FIA and Federation internationale de motorcycleme – FIM for Motor cycles.

“Motor sport is a crowd puller. Many people attend these motor rallies and so social distancing becomes very difficult. Secondly, the rally drivers and navigators who are sitting in the front seat, there is no aspect of social distancing about it. And also the crew members who rush to service their vehicles. They bump into each other when going to the car”, he said.

Chingambu also disclosed that the association has lost out on funding because many sponsors can’t fund an event if there is no activity and the sponsors have also directly been affected by  the pandemic. The association runs events such as the motor rally’s, motor cross Championships, motor sport Spin & drifting, go-Kart’s and enduro’s.

“In terms of finance we have been hit. If we combined al the disciplines, we are looking at a budget of over K1.5 million per annum just  to smoothly run these events and also participate in international events”, he said.

He also stressed that another major factor that makes it difficult to continue their normal routine of events is that their activities are done on privately owned land and the owners of this land are understandably skeptical to allow people on their property because of the virus.

“In terms of rallies, we run on private land and farms. And there is no farmer or landowner who is going to allow you to go in their farm with COVID 19 in the air. He/she has got animals, workers and a family to protect from the virus. So definitely, they cannot permit you to go run these events on their farm”, he said.

Meanwhile, Chingambu says that this year is a bit challenging for them and that all tournaments remain suspended until when the situation changes. In line with acting in line with the new normal, wearing of masks still remains a challenge for the sport but the association would sit and advise we’re new measures and actions are agreed.

The association is also looking out for guideline from the National Sports Council of Zambia as well as its international federations to see how best these various motor sports disciplines can be resumed.

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Motor Sport Association of Zambia has reaffirmed

Opinion

By Trevor Simumba

Mining has been Zambia’s economic mainstay and the Copperbelt Energy Corporation – CEC, the engine that has unfailingly powered the wheels of mining. CEC accounts for between 45-50% of Zambia’s national energy consumption.

Beyond its role on the Copperbelt, CEC is an indispensable member of the Southern African Power Pool (SAPP). It co-owns and operates, with DRC’s national utility, Société Nationale d’Electricite (SNEL), the transmission lines interconnecting the Zambia and DRC electric grids, and which form an integral part of the SAPP central transmission corridor.

This is the only connection between DRC and Southern Africa, hence, it’s an indispensable enabler of an interconnected regional power market.

In 2006, Cinergy Global Power (USA) and the National Grid (United Kingdom) who, jointly, owned a controlling stake of 77% in the company sold off their interest to a group led by local entrepreneurs – Zambian Energy Corporation Limited (Zam-En).

More importantly in 2008, CEC was listed on the Lusaka Securities Exchange – LuSE, empowering thousands of Zambians, through direct and indirect ownership of CEC’s shares, including employees who were allocated 5% of the share offer.

Despite the company’s continued growth and effective strategies to explore business potential by establishing partnerships (such as the agreement with Dangote Cement) and diversifying into alternative forms of power (such as solar energy), the biggest challenges the business faces are policy related: Zambia fiscal policies, the standoff and potential liquidation of Konkola Copper Mines (KCM) which has also affected ZESCO, power shortages arising from low hydrology, and the non-renewal of the Bulk Supply Agreement (BSA) with ZESCO.

It is important to highlight that CEC has not been sitting on its laurels. The company have attempted to invest further in its own generation capacity but has been thwarted by the Government’s inability to provide the required policy framework, approvals and incentives to implement projects.

Public records show that the company has invested about $3m on the potential Luapula River hydropower sites in feasibility studies with plans of generating up to 750MW of hydropower. We have heard of investment activities of over $35m in Kabompo. They led the way with the Riverside Solar PV in Kitwe which was commissioned two years ago and became the first utility-scale solar plant in the country to be connected to the national grid. Aren’t we supposed to be proud of this as a country?

The irony of the whole saga is that the mining  sector, from a power supply perspective, is  important  for  ZESCO  and, therefore, one would have expected that the Government  and  ZESCO  would be keen to negotiate and agree for a  successor agreement to the BSA to progress and finalise in the next few months.

CEC remains an important source of foreign currency (as it pays in dollars for the power it buys from ZESCO) for the utility company and for ensuring continued mining activity on the Copperbelt. In fact, ZESCO relies on CEC for its bankability in terms of credit facilities. More importantly, Government through ZCCM-IH owns a large stake of 24.11 percent of CEC while the Zambian Energy Corporation, which they associate with certain individuals, only owns 13.25 percent.

They are clearly strangling CEC but receiving a dividend, courting new players into the industry but not supporting the existing ones. So, one wonders why the Government would “cut off their nose to spite the face” as they have a vested interest in both ZESCO and CEC. One would have thought the Government would be at the forefront of ensuring an amicable solution but instead they have been fomenting rebellion.

They want to encourage private sector investment and participation in energy, yet thwart projects that would actualize that that desire and are now acting in a manner intended to strangle an existing investor.

Today, because of the key factors laid out above and the challenges CEC faces as a result of inconsistent public regulations and policies, Zambia may lose another iconic Zambian company that is fully managed by Zambians and which impacts thousands of Zambian lives. The KCM saga has created a potent mix of confusion amidst a genuine need to review the ZESCO/CEC relationship.

The question is, if KCM is producing and selling copper, why are they failing to settle their dues to CEC? Where is the money going? Surely, is it not in the interest of Zambia and ZESCO that KCM pays for its power which would also be a huge boost to ZESCO particularly at this time of economic recession?

We need a much more comprehensive response from the Government, and it is hoped that when Parliament is in session Members of Parliament can make queries in relation to this. Zambia cannot afford anymore politics in the mining and power sectors. We need sanity to prevail.

About the Author:
Trevor Simumba is an International Trade Economist

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By Trevor Simumba Mining has been Zambia’s economic

Tech

The license to operate a mobile network in Zambia by Unitel’s UZI has expired. UZI, a mobile phone operator, who were set to be the fourth mobile network operator in Zambia, has failed to start its operations due to what has been described as failure to raise insufficient funds.

UZI kept on pushing forward the date to launch its network and the last timeline given to them to launch was end of May 2020. Zicta’s deadline to UZI to launch and begin operations was end of May 2020 as confirmed by the ICT regulator.

When ZICTA was contacted, Manager for corporate communications Ngabo Nankonde acknowledged that the extension given expired on end of May and promised to issue a comprehensive statement this week.

According to records seen by the Zambian Business Times – ZBT, UZI issued a statement agreeing to launch operations in february 2019 an reasons for the delay was because they wanted to insure that the equipment was thoroughly installed.

The Permanently Secretary – PS in the ministry of Transport and Communications, Misheck Lungu had earlier in the year through an exclusive interview with ZBT on January 22, 2020, explained that the delay in the launch of the mobile network was attributed to the lack of resources from its parent company Unitel, as it had requested ZICTA to consider extending its license for 6 months due to challenges in externalizing funds.

Lungu then disclosed that the ZICTA had granted UZI an extension of up to end of may 2020, which is the final expiry date of its initial license period hence hoping that the company begins to operate before the stipulated date.

“UZI faced some challenges with finances from its parent company hence they asked us if we can extend their license to the closure date, so they can find a way of sourcing the required funds. Aside that, they have started talks with companies they would sign contracts with and are planning to rent out towers for them to start their business,” he had added.

UZI’s parent company, Unitel in which one of africa’s richest women, Isabel Dos Santos, the daughter of Angola’s former president owned 25% pledged to invest more than US$350 million into Zambia.

The failure of UZI to launch operations has delayed the Zambian Telecoms market from getting a forth mobile network operator that was expected to enhance competition as well as provide a forth option for consumers. The telecom sector in Zambia only has three players that include publicly listed Airtel, privately held MTN and state owned Zamtel.

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The license to operate a mobile network

Markets

Prominent economist Professor Oliver Saasa has commended government’s move of awarding the contract to Lazard as the best evaluated bidder to advise Zambia on its debt restructuring.

Prof. Saasa has stated that though the decision has attracted significant interest among economic and political players, Zambia however urgently needs re-profiling of its national debt which is almost due and its restructuring should not be a questionable matter.

Ministry of Finance had last week announced it had selected Lazard, a financial advisory and asset management firm as advisor to provide consulting services to the Zambian government for liability management and restructuring of its debt portfolio over a period of three years.

Prof. Saasa has told the Zambian Business Times – ZBT in an exclusive interview that government’s decision was based on the competency of the firm, therefore nationality of which company needed to be selected to restructure debt should not be an issue as a tender was issued we’re all those who have the skills and expertise would have lodged their papers.

He further stated that it is important to recognize that debt restructuring particularly sovereign debt needs certain proved skills and expertise, hence, he is hopeful that Lazard will bring on board what the country is looking for.

“There should also be the will [from top officials at the ministry of finance] to take in advise while this process in ongoing, whether its from an international or local firm. Lazard can come in and make proposals to government on how best the restructuring can be done or negotiated but the political will to take in advise has to be there,” he said.

Prof. Saasa added that there is need to also understand that debt restructuring is different from minimizing a default as this is the reason why Lazard has come in to help stop the possibilities of Zambia’s debt defaulting which if left unattended too becomes more dangerous for the economy.

“At the same time, I don’t see why someone should pay so much money [US$5 million] to bring in a foreign company because the country and the Southern African region has enough competence that can help government put in place systems that can manage debt restructuring. However, this decision must have been analyzed and was seen worth it, and this cannot be questioned,” He said.

There has been some concerns by some sections of the society in Zambia on why a foreign firm was selected and that the contract which has been pegged at US$5 million has been considered as high.

But analysts have countered this by stating that a request for proposals was initially sent out and that only a combined bid from Barclays and ABSA who have a presence in Zambia was the only response that was listed among the firms which had successfully tendered for the job.

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Prominent economist Professor Oliver Saasa has commended

Mining, Tech

Zambia’s power utility company ZESCO Limited has confirmed that they have resumed direct transmission of power supply to Konkola Copper Mine – KCM on negotiated commercial terms.

ZESCO Senior Manager-Corporate Affairs Dr. John Kunda has told the Zambian Business Times – ZBT in an exclusive interview on June 02, 2020 that the firm has started the supply of power to KCM mines effective yesterday 1st June, 2020.

By implication, this confirmation from Zesco means that the Copperbelt Energy Corporation – CEC statement released yesterday that they have commenced power restriction process to KCM may turn out to be an academic exercise.

CEC had on 1st June 2020, through their corporate communications Manager Chama Nsabika stated that they had commenced what they termed as “ CEC commences KCM power restriction process” due to there being no contractual basis to provide service as well as to recover outstanding debt.

To safeguard the continued power supply to the mines located on the Copperbelt, a Statutory Instrument (SI) was issued by the Minister of Energy on 29th May, 2020, where ZESCO was given the ‘right of passage’ to supply power to KCM directly and that transmission and distribution lines (part of which belongs to CEC) was declared as a common carrier and that CEC would be rewarded for usage via wheeling charges.

Dr. Chanda has since confirmed with ZBT that transmission of power to KCM has begun on 1st June 2020 premised on existing charges as both Zesco and KCM work on concluding negotiations and final sign off on new terms and conditions.

“The wheeling charges will need to be agreed on as as per SI through the Energy Regulation Board – ERB, but in the meantime we will be using the CEC infrastructure to transmit power to our client KCM, so it will be on applicable terms and conditions not for free,” He said.

He added that the timeframe as to when negotiations and new contract will be concluded is not yet known but that given any outcome, terms and conditions will still be applicable from the agreed effective date of 1st June, 2020 as that’s what has been agreed on.

He said the firm will keep its stakeholders informed once negotiations on terms and conditions are concluded and that it will continue to supply power to all Copperbelt based customers and to KCM which happens to be a new client.

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Zambia’s power utility company ZESCO Limited has

Sport

The Zambia Golf Union – ZGU has reiterated that golf tournament are still suspended despite the lifting of restrictions for the use of the golf clubs. The golf union stated that all tournament fixtures remain suspended and still await health authorities guidelines.

In an exclusive phone interview with the Zambian Business Times – ZBT, ZGU president Christopher Mulenga disclosed that only social golf is being played but corporate golf tournaments and professional golf tournaments have been suspended.

The golf union is also reviewing the situation with guidance from the ministry of health and the ministry of sports.

“To be honest with you, organized golf is not yet open, what people are seeing is just social golf. The annual fixture which should have started in February is suspended and we haven’t gone back to operate as normal”.

“We suspended all fixtures even before the republican president announced the ban. It was a proactive move by Zambia Golf Union itself, and we are reviewing the situation in terms of the information we are receiving from the  Minister of Health and the Minister of Sports”, he said.

He further stressed that the loss from the suspended league is momentous but a proper assessment on the loss needs to be made before arriving at actual figures, but the loss is huge. And tournaments like Zambia Open and Zanaco Masters have all been suspended. The fixtures run from February till November.

All the major cities in Zambia have international standard golf clubs. The capital Lusaka has the Lusaka golf club and the privately held Bonaza golf club. The second largest city by population, Kitwe has the Nkana golf club, Ndola has the Ndola golf club, tourism capital of Livingstone has the Livingstone golf club while Solwezi has Kansanshi golf club.

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The Zambia Golf Union - ZGU has

Companies

Two of Zambias largest and economically active land borders of Nakonde and Chirundu have resume normal operations

The Zambia Revenue Authority – ZRA has confirmed that after consultations with other Revenue Authorities in the region particularly Zimbabwe and Tanzania, the institution has with immediate effect started operating 24/7 at Chirundu for the next one week while Nakonde has resumed the normal 24/7 as before the shutdown.

ZRA is working with other Government agencies to ensure that travelers and the general public are served in an efficient manner and reduce congestion at the borders.

The Covid 19 pandemic has created a huge upsurge in traffic volumes at Chirundu and Nakonde border posts in the past weeks due to traffic diversions from other entry points attributable to health measures implemented by some transit countries in the region.

This has further caused enormous pressure on the social and health amenities to the communities at the two entry points and if left unchecked may exacerbate the current pandemic.

In a statement made available to the Zambian Business Times – ZBT on June 2, 2020, ZRA Commissioner General Kingsley Chanda has explained that this measure will also reduce the costs of doing business in the country and these measures shall be reviewed in line with the prevailing situation at the time.

The Authority has since encouraged all importers, exporters and clearing agents to take advantage of the online platforms to lodge in entries from anywhere any time. Chanda said this is because the authority has increased human resource capacity for the two borders to ensure speedy processing of all entries.

The Authority has further recruited 150 new employees to help deal with the situation. These are part of the 1,200 applicants mainly from the major public and private universities in Zambia who did their aptitude tests in February 2020.

The Authority is aiming to increase its numbers in terms of human resource but due to budgetary constraints only 150 additional headcounts was approved for the 2020. The new officers will report for training on Monday next week and will be dispatched to their various stations countrywide after graduation from training.

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Two of Zambias largest and economically active

Agribusiness

The Cotton Board of Zambia – CBZ has disputed the forecast cotton production figures which indicated a reduction of 43% of seed cotton for this’s marketing season announced by the Minister of Agriculture.

CBZ is on record to have confirmed that local cotton production and textile industry can earn Zambia over US$220 million in exports if well managed. Moreover, more can even be saved in terms of forex if the local textile industry is harnessed and developed.

Agriculture Minister Michael Katambo had last week announced that production of seed cotton is forecast to reduce by 43% to about 41,000 metric tonnes from about 73,000 metric tonnes produced in the last farming season.

CBZ Executive Director Dafulin Kaonga has disagreed with the announced figures stating that figures submitted by the board where double the digits leading to over 80% reduction in total production numbers.

He told the Zambian Business Times – ZBT in an exclusive interview that the industry has faced a reduction in production over the years and this is mainly due to adverse pricing mechanisms and the competition of other commodities such as Maize and Soya beans which have attracted more growers and are deemed to be more profitable.

Kaonga disclosed that pricing of seed cotton has continued to be stagnant and range between K3.50 to K3.70 per Kg hence the stagnation in pricing on the market has led to a reduction in production with farmers opting to grow other cash crops.

He further said currently pricing of seed cotton is determined by the buyer (buyers market) as there is no law that requires the Cotton board to intervene in determining pricing. The cotton board has called for all stakeholders to come up with a transparent pricing mechanism which will create a win-win situation for both farmers and buyers.

He added that the board has since made submissions to government on how cotton should be produced in the country and proposed methods of production but that there has not been any effective response, hence hoping government will get back to the board soon to urgently stem the drop in production.

“We also questioned the quality of inputs that affect production which is also a major shift in terms of what farmers are able to get, however we are still pushing for response and hoping all will be better in no time,” He said.

Zambia has a large local market for apparel and textile products which is currently satisfied from imports and an open market for second hand clothing (locally known as Salaula).

The cotton industry needs an integrated approach that would see trade policies tuned to support local cotton cultivation, that would feed into a local textile industry that would then be the anchor to mop up and buy off locally produced cotton.

Only after an integrated development from cotton cultivation, processing and the local textile and apparel industry that is supported and able to produce finished clothing products for low, medium and high end would the industry resume its growth trajectory.

Zambia’s population is now about 18 million people and this should give the authorities a platform to rethink the policy on second hand clothing and allowing cheap imports which in effect is exporting jobs to other countries.

There should be policy coordination with the ministry of trade to ensure that local manufacturing is allowed to grow before its subjected to competing with imports from mature industries and countries.

The Copperbelt, Central, Lusaka, Southern and Eastern provinces still have some textile companies that are currently operational but rely heavily on imported apparel. These can be engaged to kickstart this industry and build it up from group up.

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The Cotton Board of Zambia - CBZ

Mining

The preliminary report of the gold quantities (or reserves) available at the much talked about Kasenseli mine site has not yet been finalized.

Mines permanent secretary Barnaby Mulenga told the Zambian Business Times – ZBT in an exclusive interview that detailed exploration has not yet been completed and that detailed reports on the availability of huge quantities of gold are tied to drilling which is still on-going.

He said Zambia Environmental Management Authority – ZEMA has already granted the Gold company a license for exploration works which are currently on-going and will be concluded within a period of three months.

He added that once mining activities begin at Kasenseli gold, the ministry will be issuing monthly reports and that this will be done while exploration works are taking place.

“The detailed exploration hasn’t been completed but we have a report which confirms the availability of gold however volumes of this gold will be told as explorations works continue and quantities are tied to drilling,” He said.

Meanwhile, ZCCM Gold Company has injected approximately K45 million for the initial phase of the Kasenseli Gold Mine Project in Mwinilunga district and with the granting of the exploration licence by end of March 2020.

The Gold company had moved on site and started mobilisation in the first week of April 2020 to undertake detailed exploration that will determine the extent of gold mineralisation in the license area.

Mulenga has disclosed that mining activities at Kasenseli Gold in Mwinilunga district will begin this week (last week of May 2020) as the ministry is granting a mining license to ZCCM Gold Company to commence works at the site.

Mines Minister Richard Musakwa had recently during his visit to the Copperbelt indicated that there are substantial volumes of gold in Kasenseli in North Western province which can help the country fight poverty and pay off its debt and as well ad build on national gold reserves.

Kasenseli mine is reported to have alluvial gold which saw a gold rush on Mwinilunga resulting in state security agents sealing off the area from further exploitation.

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The preliminary report of the gold quantities

Companies

Lafarge Zambia and Zambian Breweries – ZB have donated K100,000 to the University of Zambia – UNZA School of Engineering to help develop the nation’s first prototype ventilator.

The two giants of industry are backing the UNZA innovation as part of their wider support to the fight against COVID-19. Lafarge Chief Executive Officer Jimmy J Khan says health and safety is Lafarge’s core value, thus the health and safety of its communities, customers, suppliers and transporters is of great importance to the company.

“With the increase in COVID-19 cases around the country, the need for ventilators has never been as compelling as now. That is why Lafarge Zambia sees the importance of being part of this project. The project will not only assist in relieving certain pressures off our health system and help save lives; but it would also instill national pride, as this would be the very first ventilator that would be manufactured by Zambians in Zambia,” he said.

And Zambian Breweries Country Director Jose Moran said the company believed in working together for a better Zambia, and the collaboration with Lafarge fitted well with its dream to improve the lives of local people.

“The people of Zambia are at the heart of what we do. Their safety and wellbeing are paramount to us. We also have a track record of supporting entrepreneurs and innovation, so we will be backing UNZA and look forward to the ventilator being perfected and potentially saving lives,” he said.

In a statement made available to the Zambian Business Times – ZBT on June 1, 2020, Both Zambian Breweries and Lafarge has implemented a number of initiatives internally and externally to ensure the health and safety of their employees, transporters, customers and suppliers.

Internally, Lafarge has installed temperature checks, hand sanitisers and mandatory wearing of masks for all employees, transporters and guests that enter its plants.

In the communities near its plants in Chilanga and Ndola, Lafarge has provided vehicles branded with COVID-19 messages and public announcement systems to sensitise people on preventive measures, to help curb the spread of the pandemic.

Meanwhile, Zambian Breweries has developed a hand sanitiser formula and is manually bottling it for donation only to healthcare workers and staff, as well as importing 5,000 face shields made from recycled plastic for use by healthcare workers, and donating over 6,000 posters and 10 billboards for COVID-19 communication to government since the breakout of COVID-19 in March this year.

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Lafarge Zambia and Zambian Breweries - ZB