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The Regional Head of digital payment platform Visa, Jabu Basopo has stated that digital technology has potential to grow financial inclusion in Zambia and ensure easy access for financial services.

The Visa Southern Africa General Manager stated that digital payments driven by mobile phones has an advantage of driving the penetration of electronic system adding that it will be a game changer in a country like Zambia as many people will be able make transactions through mobile phones making it easier to access financial services.

Basopo who visited Zambia this week to meet with banks, other financial institutions and regulators to discuss how the company could contribute to increasing digital payment acceptance told the Zambian Business Times – ZBT in an exclusive interview that Visa’s vision is for 90% of payments to be transacted digitally in Zambia compared to the current level of around 10%.

He said Visa’s objective with other players in the system is to digitize cash, an opportunity which he said will increase speed and simplicity in cash transactions. He added that reducing the number of cash transactions will improve security and efficiency and that in archiving this, more merchants need to accept digital payment methods as an alternative to cash.

“Speed and Simplicity, that’s what consumer are looking for because people do not want to be in long queues to make payments or access cash, hence consumers need to have trust and confidence in the system because visa is introducing a range of new services across the continent to facilitate digital payments, including contact less QR (Quick Response) technology that enables consumers to pay for goods and services automatically by scanning a merchant barcode with their mobile phones,” he said.

Meanwhile, Basopo disclosed that the company is also working with Zambian banks to ensure that this kind of technology is accessed everywhere in the country and that it has already started talks with the Central Bank on the initiative.

When asked by ZBT on the impact of Zambia launching its own local switch on Visa operations, Basopo said Zambian’s local switch for ATM from International to local transactions will not impact visa as it is working in collaboration with other digital systems to deliver the same objective of digitization cash and it will ensure that the infrastructure delivered to customers has international standards in terms of compliance and security.

“In terms of security we have an intelligent system which will be detecting frauds because we understand that eco-system has some attempts of fraudulent activities so we have a strong team which focuses on cyber-crime and we have policies and rules in place which will make sure that we are proactive,” he said.

Visa QR is an innovative way to make payments with your mobile phone. There is no need to carry cash everywhere you go. Just select Visa QR on your mobile baking app and scan the merchant’s QR code to make payments.

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The Regional Head of digital payment platform

Tech

The National Biosafety Authority – NBA says it will not revoke licenses that it recently granted to the four companies to import products that may contain genetically modified organisms (GMOs).

The comment comes after concerns from the public stating that the Authority must revoke permits granted to Gatbro Distributors, Pick n Pay, Southern National Import and Export Limited and Choppies Super Stores market saying GMO products are still a risk for human consumption and that Zambia has limited technology and scientific equipment to independently test these foods containing GMOs.

The farming community had also raised concerns that the food in Zambia should be kept organic, arguing that these foods containing GMOs can be grown locally avoiding the export of jobs to other countries. The imported GMO foods should instead be supported for local organic and non GMO production, they urged.

But the NBA Chief Executive Officer Lackson Tonga has told the Zambian Business Times in an interview that the issuance of permits was done after risk assessment was conducted on the products that may contain GMOs and were found to be safe for human consumption.

He said people should take time to read the provisions of the act and understand what applies when an application has been submitted to avoid being misled. Tonga said the authority has scientific provisions in the risk assessment and it checks for the completeness of the application before a permit is granted.

“We also base our decisions on trying to find out if the applicant has any history where it abrogated some provisions of the act and if the applicant meets the scientific requirements, then we can be able to make an informed decision” he said.

He added that in cases where the applicant does not meet the required standards and method of formation, the authority rejects the application and does not grant a permit until it is satisfied with what has been provided.

“The permits that we grant are in two types, one is under the SI 32 of 2019 where we grant for import which is for a 5 year period, while we have another permit for placing on the market which is 6 months,” he said. Tonga further explained that smuggling challenges may occur in the importation the products and has assured that the authority will put in measure to alert and sensitize the public.

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The National Biosafety Authority – NBA says

Markets

The Zambia Metrology Agency – ZMA has in the first half of 2019 inspected a total number of 2,057 instruments out of which only 1,167 instruments were found to be compliance representing a compliance rate of 64.31%. The Agency further disclosed that a total of 15,636 weighing and measuring instruments representing 81.5 % achievement against the year to date target of 19,181 instruments.

Speaking at a media briefing on July 30, 2019 in Lusaka attended by the Zambian Business Times – ZBT, ZMA Executive Director Himba Cheelo explained that the negative variance is attributed to some of its major clients submitting their instruments late for verification.

She said the major cause for non- compliance was due to non-submission of instruments for verification and the use of unapproved weighing and measuring instruments. She further disclosed that during the inspection period an unnamed company was fined with K60,000 for tempering of verification marks on a fuel tanker.

“During these inspections, the Agency noted that non- compliant products failed mainly on net content and labelling requirements. Most of the non-compliant products which included bread, mealie meal, cooking oil, were seized and disposed of through the courts of law and we continued to educate the manufacturers, suppliers, retailers and importers on the regulatory requirements for prepackaged commodities trade,” She said.

Meanwhile, Eng. Cheelo further revealed that the launch of the Standardized MEDA has received massive commendation from stakeholders across the country and that the project will soon be rolled out to four other towns namely Ndola, Kasama, Petauke, and Livingstone.

The dry measurement capacity project popularly referred to as the MEDA was launched on 20th May 2019 by the Minister of Commerce, Trade and Industry Christopher Yaluma. She said the project will culminate into the use of accurate measurements which will lead to fair trade, SME growth and economic development.

The Agency has however pledged its commitment to ensuring that it provides the best metrology services in the country adding that it will continue to safeguard the rights of businesses and consumers throughout the promotion of fair trade and protection against fraudulent activities where measurements apply.

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The Zambia Metrology Agency - ZMA has

Agribusiness

The Insurers Association of Zambia – IAZ has called for the development of micro insurance products which include weather index services, funeral services and travel services insurance disclosing that they are affordable and can be accessed by any group of people.

IAZ Consumer Education and Risk Manager Kambole Chituwo has told the Zambian Business Times – ZBT in an exclusive interview that there is need to also take consumer education seriously as most people do not understand or appreciate how insurance works before taking up a product adding that it an obstacle to the growth of insurance in Zambia.

He said Agriculture being one of the major contributor to the country’s economy not only through being the largest employer, but also through food and non food production, farmers should take advantage of the weather index product to cover themselves against the loss of inputs due to bad weather.

IAZ has since encouraged farmers to seize such opportunities and that the weather index insurance product is affordable as it uses Information technology such as sate-light technology, mobile phones and other online methods  to communicate which farming areas have been hit with bad weather

“The weather index product insures against losing inputs because of bad weather and it reduces cost, enables the farmer to protect against loss of capital for the next farming season. When one losses input because of bad weather, weather index will be able to cover for the lost inputs so that the farmer can plant again before the farming season is over” he said.

Kambole encouraged on the use of Information and Communications Technology – ICT by Zambians if product’s such as micro insurance is to thrive in the country. The Association notes that financial services are now mostly available through online platforms and that ICT is one way in which individuals can access products available under the insurance system in a much more efficient and effective manner.

Meanwhile, the Association has continued to sensitize members of the public and business houses on the need for people and businesses to get insured and has since urged its members to emphasize the importance of insurance and educate the public on how to go about it.

“It is important to embrace ICT as most financial services are being offered through online platforms such as the mobile money accounts by these network providers and some insurance companies only offer services through online platforms because the cost of putting up an infrastructure in every area or districts is expensive.

The use of already existing ICT infrastructure such as the mobile money network has prominence and cannot be over emphasized as it is likely to groom not only the insurance sector but also other systems in the country,” he said.

He further reiterated the importance of insurance in a country saying it protects the welfare of people regardless of the occupation and has urged the public to get better understanding on how to handle their risks and how insurance can help them get covered or mitigated.

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The Insurers Association of Zambia – IAZ

Tech

The Industrial Development Corporation (IDC) has commended the state owned national mobile network operator – Zamtel  for crossing the three (3) million subscriber base.

IDC group CEO Mateyo Kaluba has said that Zamtel has recorded notable increase in mobile subscribers on its network over the past two years. He stated that Zamtel has increased its subscriber numbers by over 175% from 1.2 million in 2016 to 3.4 million as at June 2019. This translated in a growth of market share from 10% in 2016 to the current 19%.

Kaluba also said it is the highest number of subscribers in the history of Zamtel and the highest market share attained by the company in a very competitive Telecoms sector.

In a statement made available to the Zambia Business Times – ZBT  by IDC Public Relations Manager Namakau Mukelabai, Kaluba commended the Board, Management and staff of Zamtel on the attainment of the key milestones, which he said were on account of the Board and Management embracing the transformation agenda of the IDC.

He further said the growth has been underpinned by innovation in designing competitive products, the ongoing network rollout across the country as well as the graduation to 4G and 4.5G in urban and suburban areas.

“I strongly urge the Board and management to continue to drive transformation from within particularly in areas of cost reduction, innovation and internal restructuring. We look forward to a growing, sustainable and profitable business “, he said.

Kaluba further added that the IDC would render its full support to the continued growth of the business and to ensuring that Zamtel remains a key player in the telecoms sector.

Zamtel has the potential of becoming the biggest Telecoms company in Zambia as it has the potential to grab the lucrative government account once it fixes some of the historical service related issues. The locally owned Telecoms company has recently recruited an experienced Telecoms commercial director Kenneth Sikamba who is expected to drive its sales and distribution agenda.

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The Industrial Development Corporation (IDC) has commended

Mining

Zambia has recorded a drop of 10.8% (about 11%) in copper exports resulting into a trade deficit of K516.8 million in June 2019, reversing some gains from a trade surplus of K501.1 million recorded in May 2019 indicating than the country imported more that it exported in nominal terms. Trade account balance has a direct impact on the forex reserves and the exchange rate.

Speaking during the release of the Central Statistical Office Monthly Bulleting in Lusaka on July 25 2019, CSO Acting Director Goodson Sinyenga disclosed that imports increased by 3.6 percent from K8, 215.4 Million in May 2019 to K8, 510.9 Million in June 2019. Zambia runs a willy nelly free market economy with limited to no market controls.

Sinyenga attributed the trade deficit to the increase in intermediate goods imports, which increased by 41.3% from K1, 546.3 million in May 2019 to K2, 184.2 million in June while exports decreased by 8.3% from K8, 716.5 million in May 2019 to K7, 994.2 million in June 2019 attributing the decrease in exports earnings from intermediate goods by 14.7%.

The Traditional Exports – TEs (mostly copper and mining related products) earning decreased by 13% from K6, 0057.8 million in May 2019 to K5, 2709 million in June 2019.

“In terms of share in total exports, TEs recorded an average of 67.7 percent in revenue earnings between June and May 2019 while Non-Traditional Exports earnings increased by 2.4% from K2,658.8 million in May 2019 to K2,723.3 million in June 2019 and in terms of share in total exports, NTEs recorded an average of 32.3 percent in revenue earnings between June and May 2019,” he stated.

The Acting Director has further announced that the volume of refined Copper exported in June 2019 decreased by 10.8% from 73,777.9 metric tonnes in May 2019 to 65,797.2 metric tonnes. He said the copper prices on LME market for the corresponding months decreased by 2.7% from $6,028 per metric tonne in May 2019 to $5,868.4 per metric tonne in June 2019.

“Since copper accounts for the largest weight proportion of traditional exports, any change in the volume and price or value has a direct bearing on the performance of the traditional exports,” he said.

Copper exports are further expected to be subdued after Konkola Copper Mines – KCM shareholder, the Zambia Consolidated Copper Mines investments holding company – ZCCM IH filed for liquidation of the interest of Indian miner Vedanta.

The Zambian Government has proceeded to invite new equity partners with more than 7 international companies already confirming having conducted due diligence with the intension of partnering with ZCCM IH as replacement for Vedanta.

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Zambia has recorded a drop of 10.8%

Markets

The depreciation of the Kwacha has continued to fuel imported inflation as most consumer goods are imported in Zambia. Moreover, the recently hiked prices buying price for maize by the food reserve agency – FRA has signaled a general increase in the staple food – Maize prices across the country, further  weighing down on the national inflation rate.

According to the latest monthly bulletin, the year on year inflation rate as measured by all items Consumer Price Index – CPI for the month of July 2019 has continued on an upward trajectory and increased to 8.8% from 8.6% recorded in June 2019.

Addressing the media in Lusaka on July 25th 2019, Central Statistical Officer Acting Director of Census and Statistics Goodson Sinyenga announced that increase in the annual rate was attributed to both food and non- food items price movement.

Sinyenga told the Zambian Business Times – ZBT that the increase in annual rate of food inflation was attributed to prices increase in food products such as Breakfast meal, Roller Meal, Maize gran, Sampo, Bread, Bun and rice imported. Zambia, with dependence on rain fed Agriculture was adversely affected in the 2018/2019 farming seasons due to low rainfall patterns across some key maize producing regions.

For the increase in non-food annual rate of inflation, the data collected shows that it was mainly attributed to price changes in clothing items. Zambia largely relies on imported clothing and apparel, which are all affected by the depreciation of the Kwacha. There has also been a general raise in imported products retail prices with the majority of Zambians having their earnings in Kwacha, which now commands a lower purchasing power.

Meanwhile, the provincial annual inflation rate for July 2019 increased for Central, Copperbelt, Eastern, Luapula, North Western and Western provinces while it decreased for Northern and Southern provinces.

Sinyenga further disclosed that Western Province had recorded the highest rate for annual inflation at 10.4% followed by Southern Province at 9.4% while Northern province recorded the lowest annual rate of inflation at 7.1%.

“At provincial level, Lusaka province recorded the highest contribution of 2.7 percentage points to the overall annual inflation rate of 8.8% recorded in July 2019 and this implies that the price movements in Lusaka Province had the highest influence to the overall annual rate of inflation, Copperbelt had the second highest contribution of 1.9 percentage points and Northern Western Province had the lowest contribution of 0.3 percentage points,” he said.

The Acting Director also disclosed that the Month on Month inflation rate for July 2019 was recorded at 0.5 percentage points, down from 0.7 percentage points increase recorded in June 2019. This was indicating 0.5 percent difference of prices of goods and services between June and July 2019.

The Zambia Association of Manufacturers – ZAM has called for deliberate policies which would encourage local manufacturing especially of consumer goods to mute the impact of imported inflation and protect the purchasing power for the majority locals whose earnings and savings are in Kwacha.

The Zambia through the Bank of Zambia – BOZ had set a target inflation rate band of 6 to 8% and this is now being breached. Failure to reign in inflation in good time will spell doom to the economy and further crush the purchasing power of the majority of local citizens and businesses.

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The depreciation of the Kwacha has continued

Mining

In what is ensuing as a possible diplomatic row, a South African High Court has granted Indian miner Vedanta Resources an urgent interdict halting the liquidation of Konkola Copper Mines – KCM, a Copper Mining unit in Zambia until a final decision is made through arbitration.

In may this year, the Zambia Consolidated Copper Mines investment holding company  – ZCCM – IH,  a state owned investment company that holds the stake in mining companies raised a disput and filed for liquidation of Vedanta’s interest in KCM, accusing the Indian miner of breaching the terms of its license and went on to  appointed a liquidator to run the Company, in which it owns 20% and what is believed to be a golden share.

In a report obtained by the Zambian Business Times – ZBT on July 23, 2019, South African High Court Judge Leicester Adam has indicated that the wind-up proceedings must immediately be withdrawn until a final decision in made through arbitration.

“Pending the final determination of the arbitration, the first respondent is interdicted and restrained from taking any further steps in the furtherance and prosecution of the winding up proceedings,” He said.

And in response to the ruling and orders indicated by the South Africa Court, Zambia’s Mines Minister Richard Musukwa has rubished the validity of the ruling stating that the order given by South Africa has no jurisdiction and is not applicable in the Zambian legal system hence the judgments are not enforceable in the country.

Addressing the Media in Lusaka on July 23, 2019, Musukwa said government continues to respect the jurisdictions of other countries and it has since advised the South African Attorney’s to appeal against the judgment.

He said Zambia has a history of foreign judgment been made in a number of cases and has since urged the public to remain calm as the process is under control. At the same media briefing event, Justice Minister Given Lubinda said the South African Judge can not in any way undermine the decisions made by the Zambian government hence it will ensure that it protects the integrity of the judiciary in Zambia and the country’s sovereignty.

Earlier in July, Mines Minister Ricard Musukwa announced that government expects bids for the KCM assets to be submitted within July by nine companies from Russia, Turkey, Australia, Canada and China that have expressed interest to partner with ZCCM – IH.

Zambia is a key export destination for South African products and the two countries enjoy deep rooted political ties with Zambia having being new a key player in facilitating the end of the minority apartheid rule in South Africa. Zambia is yet to appoint a new ambassodor to South Africa.

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In what is ensuing as a possible

Markets

Chairman of the Cooperating Partners Group – CPG, German Head of Development Cooperation Christoph Fritz has urged newly appointed  Minister of Finance Dr. Bwalya Ngandu to continue with the country’s efforts towards acquisition of an IMF Supported Economic Programme in order to expand the financing options available to Zambia by way of support from other cooperating partners.

Speaking when Cooperating Partners Group – CPG paid a courtesy call on the finance Minister in Lusaka on June 23th 2019, Dr. Ng’andu said there is need for immediate action to push policy implementation as required by the country.

Finance Minister Bwalya Ng’andu says his job honeymoon is short as the terms of reference given to him by the Republican President to stabilize and grow the economy offer limited room for delay.

“Hard and smart work is beckoning, the need for action is immediate, my honeymoon is short and my Ministry will require your unfettered support to push policy implementation and get work done,” he told the CPG delegation.

Dr. Ng’andu however pledged to meet all the partners individually in order to reach common ground on areas that need attention in order to stimulate faster implementation of development programmes.

The Cooperating Partners have restated their commitment to support the implementation of the Seventh National Development Plan and the delegation has reaffirmed their support towards building a strong partnership with the Zambian Government.

Christoph Fritz on behalf of CPG further expressed emphasized the need for the Zambian Government to implement austerity measures as it is a very important message to the international community because it demonstrates the resolve of the authorities in taking corrective measures in the country’s progression towards fiscal health.

Among the other issues discussed in the courtesy meeting were debt management, financial governance, private sector development, value for money public investments, protection of social spending, and drought responsiveness.

Further, the cooperating partners listed the e-voucher programme and the economic stabilisation and growth reforms among the issues that need the closer attention of the Zambian Government.

Contributing to the proceedings, African Development Bank Country Manager Mary Monyau announced the banks approval of a support package that will help Zambia with capacity improvement in domestic resource mobilization and debt management.

Newly appointed Minister Dr. Ng’andu has taken a hot job and market players are eagerly waiting to see what new policy emphasis will be pursued more vigorously than the others. He is currently handling a delicate situation as market players line up to try to influence the policy direction.

Various international and local players are jostling to meet him to try and influence the country’s economic direction of policy in their respective interests and it remains to be seen which direction the new minister will tilt towards. He gave a hint at his swearing in that most policies are already there and its more the implementation that the availability of credible policies that is lacking.

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Chairman of the Cooperating Partners Group -

Markets

The World Bank has called for the Zambian government to undertake bold fiscal and structural policy reforms to preserve macroeconomic stability, boost business and market confidence, and improve its growth prospects for 2019 and beyond in line with the Zambia Plus economic program.

The latest World Bank’s Economic Brief on Zambia has indicated that Zambia’s path to economic recovery remains weak, reflecting both exogenous and policy uncertainties.

The brief has indicated that despite the Zambian economy growing by 3.7 percent in 2018 from 3.5 percent in 2017, a stronger recovery was undermined by lower crop harvest and fiscal slippages that led to the accumulation of new public expenditure arrears and high government borrowing that impacted private sector activity.

Speaking at the launch of the economic brief in Lusaka last week, World Bank Senor Economist Samson Kwalingana said under the current policies, growth is forecasted to weaken to 2.5 percent in 2019 and remain below 3 percent over the medium-term while inflation remained within the authorities’ target range of 6-8 percent in 2018, averaging 7.5 percent for the year, pressures are now mounting, leading the central bank to tighten its monetary policy stance in May 2019 for the first time in over two years.

The brief also suggests some policy options including (i) front-loading fiscal consolidation to return to medium risk of debt distress and create fiscal space for inclusive growth and strengthening debt management to reduce the debt service burden and minimize debt-related vulnerabilities.

In addition it suggests rebuilding foreign exchange reserves to buttress external stability, and implementing plans to improve the financial and operational sustainability of electricity utility ZESCO and enhance the transparency of of operations and performance of State-Owned Enterprises (SOEs).

The report highlights multiple opportunities that Zambia’s abundant renewable natural resources present to support sustainable economic growth. “Zambia’s economy has thus far been dominated by discoveries, expansion, and fluctuations in the minerals sector, but going forward, the country needs to harness its renewable natural resource endowment to promote sustainable growth”.

“While the contribution of renewable resources like agricultural land, forestry and fishing to GDP has declined in recent years, the sector’s linkages with the rest of the economy remain significant,” said Ina Ruthenberg, World Bank Country Manager for Zambia.

Zambia has recently undertaken a change in Finance Minister, with former Bank of Zambia Deputy Governor Dr. Bwalya Ngandu taking over from ex-banker Magerate Mwanakatwe. The move has largely being welcome by the markets and more is expected from the new minister.

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The World Bank has called for the