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Socialite and Former Aspiring Member of Parliament

Markets

Banks challenged to cut lending rates

A financial economist, Bright Chizonda says Zambia as a country has improved in terms of financial inclusion especially when you include the penetration of mobile money services but remains challenged when it comes to loans because the lending rates are too high.

Chizonde stated that there is need to interrogate how the interest rates are computed, come up with immediate actions that can led to the average lending rates dropping so that individuals and businesses can start to borrow for investment and growth.

Analyst say the Bank of Zambia should not just hide in technicalities, but roll their sleeves, engage banks and the treasury to come up with short, medium and long term actions to bring down the lending rates. As things stand, nothing will come out from any of the successive governments efforts if lending rates remain at rates beyond normal business or industry margins.

In an interview with the Zambian Business Times – ZBT, the financial economist called banks to come up with lending products that are suitable for the bigger number of local businesses. “They should start giving more loans that are realistic to service because some current interest rates are too high for most industry margins and local company rates of returns.

Inflation has now been recorded as a single digit, below 10%, so banks should be open about what other factors which government should work on so that we can also have single digit lending rates. Otherwise, we risk having more discussions and talk shows that will not held bring down lending rates.

When banks requirements are not realistic with what is available with the majority of the citizens, when the lending rates are too high, then micro finance institutions also have even higher rates. Informal lenders would then have even much higher rates than micro finance, so the vicious circle continues.

He further added that it is gratifying to note that the banking sector has made itself familiar with mobile money and thus they have allowed transactions from and to their respect bank accounts. Chizonda stated that Banks should continue going that direction of encouraging closer collaboration between mobile accounts and Banks as it increases subscribers and continues to encourage financial inclusions. The next step now would b extending lending services to the larger mobile money account holders.

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A financial economist, Bright Chizonda says Zambia

Lifestyle

Those sharing the obscene video linked to DEC boss risk arrest – Police

Zambia Police spokesperson Rae Hamoonga has warned that all those sharing the obscene material that is linked to the Drug Enforcement Commission – DEC Director General Mary Chirwa on different social media platforms risk being arrested.

Hamoonga stated that section (177) of the penal code chapter (7) of the laws of Zambia prohibits the production, publication, circulating, offering, position and solicitation of any obscene materials, thus all those doing what the law prohibits are committing an offense and risk being arrested

In an exclusive interview with the Zambian business times-ZBT, the Police spokeperson stated that the issue is actively being investigated and it’s an ongoing matter. He said the Police department will issue a statement on its stance on the alleged video that has gone virial.

He has since urged the general public to stop circulating the obscene video and for those in possession of the videos to delete them, because if one is found in possession of the videos, they will simply be arrested, he told ZBT.

The DEC Director General Mary Chirwa is yet to issue a statement denying the authenticity of the video, a situation which has led to even more speculation as no official statement even from her employer DEC has so far been made public.

This is in a matter where the Drug Enforcement Commission (DEC) Director General Mary Chirwa has became a subject of social media speculation after some pornographic videos went viral with the public alleging that she was the person in the obscene video.

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Zambia Police spokesperson Rae Hamoonga has warned

Markets

BOZ fails to raise the targeted K2billion in July treasury bill auction

The Bank of Zambia – BOZ, the country’s central banks has for the fifth (5th) time this year failed to raise the required K2 billion per auction as only K889 million was raised during the latest auction results published on July 14, 2022.

The subscription rates are an economic barometer of the economy as an oversubscription is generally seen as a mark of economic confidence by investors while an undersubscription is seen as a score for low investor confidence.

According to the treasuring results seen by the Zambian Business Times – ZBT, BOZ which raises funds on behalf of the central government through issuing treasury bills, only managed to raise K889 million out of the targeted K2 billion, an undersubscription or low uptake of 44%.

A further check of the auction results for 2022 done so far, the central bank has so far recorded a total of five (5) out of fourteen (14) undersubscribed auctions, which translates into a success rate of 64%.

BOZ first recorded an undersubscription on April 21, 2022 when only K580 million was raised out of a target of K2 billion. The second undersubscription was then recorded on May 19, 2022 when K1.5 billion was raised out of a target of K2 billion.

The months of June and July 2022 have been the hardest when a total of three undersubscribed auctions have been recorded. One was on 2 June 2022 when K1.5 billion was raised and then the one on June 16, 2022 when K1.7 billion was raised and the latest one on 14 July, 2022 when only K889 million was raised, all below the target of K2 billion.

BOZ is further struggling with a market dogged by high lending rates which have slowed down investments and dampened consumer spending. Most banks in Zambia use the treasury bills discount or interest rate as a floor price for pricing loans. With the T-bill rates remaining relatively flat despite the single digit inflation rate, lending rates remain high.

Banks are currently charging high lending rates of about 22 to 24% per annum while micro lenders who service the massive number of informal sector employees and local businesses are facing lending rates of about 60% per annum, a situation which is unacceptable in most functional economies.

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The Bank of Zambia - BOZ, the

Mining

Kalumbila Chiefs asks for 15% revenue share from FQM

North Western Province Chiefs who are the original and rightful custodians of the wider community interests of the people of the province have demanded for a minimum of 15% revenue share from First Quantum Minerals – FQM from all minerals mined in the their areas that their chiefdoms have awarded to be exploited for mining.

The Chiefs in North Western province have asked the Zambian government to allow at least 15% of the revenue collected from the mining activities in the province to stay in the province to facilitate development as well as enable the local people benefit directly from their God given wealth which they occupy.

Speaking during an engagement meeting with President Hakainde Hichilema ahead of the ground breaking ceremony of the Nickel enterprise Mine, Chief Mumena of the Kaonde who was speaking on behalf of all the respective Chiefs stated that they are looking forward to the results of the reviewing of the mining policy which is ongoing.

Chief Mumena said the assignment is critical to the Communities and the country at large as it addresses the issue of mining revenue and the local benefits to the host communities in north western province and the country at large.

He said submissions were made concerning the mining policy were it was suggested that at least 15% of revenues collected from the mining activities in the province must remain in the province to facilitate development. Chief Dr Mumena said this will mitigate the negative impact that have been arising from mining in the province.

He explained that, “almost all the districts in the province are mining districts, so we want to see the policy that you have escalated and this is on decentralization which we think that one further step towards decentralization will be to ensure that at least 15% remain in the province.”

The Chiefs have further asked for a minimum of 5% equity share for the local host communities as it is going to help in the sense that these are communities that are losing out on the land, water resources, hunting grounds, livelihoods etc that the mining companies have taken over.

Chiefs in Zambia have lost the power and Authority which they had after the colonization of the country. Their role has been diminished with political office holders who are elected officials that have replaced the colonial system enjoying excessive state power but poor at safeguarding national and wider community interests.

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North Western Province Chiefs who are the

Companies

ZB explains sugar imports as shortages emerge

Refined sugar shortage has emerged on the Zambian market with calls for government to open up the market to private importers and not only restrict the issuance of import permits to a few large multinational companies.

And Zambian Breweries Plc which is one of the companies that had been listed as having resorted to importing sugar has clarified that the company decided to import refined sugar due to operational challenges, which were emanating from the main supplier within the country.

According to information obtained by the Zambian Business Times-ZBT, the duty on refined sugar was suspended until 31^st July 2022 for 4 companies to allow some companies that were issued with Sugar import quotas and permits to import without paying relevant import taxes.

Zambian Breweries – ZB, which is one of the four (4) companies that had been issued with import permits to bring in the commodity was permitted to import 2, 100 metric tonnes of refined sugar. Other companies that allowed to import refined sugar include Coca-Cola Beverages which got a quota of 8, 500 tonnes, Trade Kings with a quota of 7, 060 tonnes and Invesco Limited-2, 000 tonnes.

ZB Company Corporate Affairs Director Ezekiel Sekele told ZBT that it was a once off short term measure and the imports were allowed in order to address the gaps that were existing from the supplier’s side as the supplier experienced some challenges.

Sekele explained that the importation of refined sugar is not something that will be happening going forward as the company is getting all its required quantity locally noting that such challenges are understandable. He revealed that government, the main suppliers and all key parties worked together to ensure there is stability and agreed to allow imports adding that all stakeholders are engaging for purposes of progress.

Sekele clarified that ZB does not intend to import more sugar, as the idea is to support local industries because local sourcing is the only way to achieve sustainability, but when there is a genuine operational challenge; all parties sit together and find a way forward.

“I believe that at the moment the main supplier is beginning to close those supply chain challenges, the operational challenges that we had experienced earlier on. It’s normal for them to experience operational challenges”, he said.

He noted that a number of players in the country have been experiencing operational challenges in the last 2 years due to supply chain challenges which in many instances have impacted the local trading environment adding that this can be attributed to what has been happening globally and regionally.

Sekele added that the local manufacturing sector has been resilient in terms of addressing the many operational challenges that have been taking place. Refined sugar is used for industrial purposes and has been experiencing expanding demand year on year.

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Refined sugar shortage has emerged on the

Mining

Largest Nickel mine in Africa launched in Zambia.

First Quantum Minerals FQM has launched the Largest Nickel Mine in Africa -Enterprise Nickel Mine – in Kalumbila District of North Western Province that will see the miner take in about $800 million in annual revenues.

Speaking during an official launch of the ground breaking ceremony Monitored by the Zambian Business Times –ZBT – President Hakainde Hichilema who officiated the ground breaking ceremony said the project will focus on mining and processing nickel which will contribute towards the raw materials that will be used in the electric vehicles.

President Hichilema said the project will play a key role in the nation’s continued development. The enterprise Nickel Project is expected deliver quit a lot as it will contribute too many value aspect and value components.

He reiterated that the project will also help the vision that Zambia has in playing a critical part towards the transition of energy from brown energy to energy the will reduce carbon emanations. This will help in transitioning from Fossil fuels to electric vehicles which requires nickel.

The Zambian president said he was fortunate that the country will host a fair share of the Nickel which will be produced and other minerals being mined.

Earlier ZBT has reported that once operational the project is expected to generate over $800 m will raise treasury income which part of the income will be channeled to support the free education policy.

The new Enterprise Nickel mine located approximately 14 kilometres from FQM sentinel mine in Columbia, has been given the go ahead, following FQM’s pledge to invest a final US$100 million in the project.

Once operational, the enterprise will be on the top ten 10 global nickel mine producing 30, 000 tons of nickel in concentrate annually, which will make Zambia Africa’s pre-eminent nickel producer. See for earlier article on this nickel mine https://zambianbusinesstimes.com/fqm-nickel-mine-to-generate-800m-revenue-per-year/

This came after election of Hakainde Hichilema as Zambia’s new president last year which saw the country reformed tax regulations in its national budget with new rules that mean that royalties mining companies pay are deductible from corporate tax.

Following this announcement, First Quantum pledged to expand its Kansanshi operations at Solwezi, known as the S3 project for about $1.25bn and also spend the final $100m instalment on its $250m Enterprise nickel project in Kalumbila District of North Western Province.

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First Quantum Minerals FQM has launched the

Tech

Standard connections for electricity remain on hold – ZESCO

Zambias power utility ZESCO has disclosed that the state-owned company is waiting for regulator Energy Regulation Board – ERB to guide on way forward before the utility can start taking orders for new connections under the standard connections category.

This follows increasing customer complaints that ZESCO is only giving very high quotations which most newly built home owners are struggling to pay for. Some have stated that the special connections fees being quoted right now are exorbitant and most low income earners can not afford.

ZESCO has proposed to increase some connection charges by over 500%, through an application to ERB that raised public uproar. The cost of living has been on the upside with most households facing steep fuel price increases and a general reduction in liquidity in the market affecting the majority workers in the informal sector.

ZESCO which operates as a monopoly in most part of Zambia may be avoiding taking new standard connection orders fearing that they would connect new customers at a loss and further exacerbate their already strained cash flows. The company says it expects to start signing and making quotation for new connections and installations soon once ERB gives a go ahead.

Speaking an exclusive interview with the Zambian Business Times – ZBT, ZESCO Spokesperson Henry Kapata clarified that it is only the standard connections category that is on a hold but the utility is issuing quotations and once paid, proceeding to connect new customer with specific scope of works.

He said the only one which is on hold is the standard ones. “We do that [connections] if we look at the scopes of work and we say this is what is required. When customer pay, we are able to connect them. But for those with standard connection requirements, they are the ones we don’t give quotations for, so for now, we wait for feedback from ERB.” he told ZBT.

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Zambias power utility ZESCO has disclosed that

Agribusiness

Only 5 commercial farmers will benefit from Stevia export deal to China

The deal signed by Zambia and China for the export of Stevia leaves will initially only benefit five (5) commercial farmers, with calls for more local farmers to get involved and start cultivating the crop and benefit from the export market that has now been re-opened.

The Zambian government announced that it has signed a Memorandum of Understanding (MOU) with China for the export of stevia, a natural sweetener and sugar substitute derived from the leaves of the plant species called stevia rabaudiana.

However Pritchard Mukuwa, the Principal Plant Health Inspector for Plant Quarantine and Phytosanitary Service, a department in the Ministry of Agriculture responsible for facilitating safe agriculture trade has revealed that currently, there are only 5 commercial farmers who are significantly growing stevia in Zambia.

Speaking in an exclusive interview with the Zambian Business Times – ZBT, Mukuwa said stevia is mainly grown in Southern province towns of Livingstone, Kalomo, Magoye and Choma, emphasizing that that this is the region where most of the stevia production has been happening.

Mukuwa noted that out of the 5 farmers that have been growing the crop, only two have been consistently shipping to China and they ship about 6-7 containers each a year and on average, one container carries 23 metric tonnes of stevia which is worth about $60,000.

The inspector mentioned that the crop fetches around $2.5 per kg adding that the price fluctuates depending on the demand and supply. He further explained that stevia is only grown for export and it is exported to China as no one is processing it in Zambia, adding that it is a new crop and there have been some market access issues.

Mukuwa told ZBT that farmers started growing stevia in 2016 and it takes about 4 months for farmers to start harvesting the crop. He added that he is hopeful that more people will venture into the production of the crop following the signing of the MOU with China.

“From growing to harvesting it takes about 4 months. You do your nursery, when you transplant from your nursery, it will take you about 4 months for you to start harvesting.It is also exported as a dried product. It is a natural sweetener and you can also use it to bake “,he said.

He noted that there is need for value addition because when the stevia is produced in Zambia,it is exported just as a crop when value can be added so that when it is exported to China,it can go straight into supermarkets and people can buy it as a finished product.

And Senior Plant Health Inspector Martin Siazemo said the current production by the two farmers stands around 322, 000 metric tonnes per year but the production was higher when most farmers were growing the crop adding that the highest production was around 900, 000 metric tonnes in 2019 with a single farmer cultivating about 90 hectares.

Siazemo mentioned that it requires some substantial investment and that is why it is mostly grown by commercial farmers. It is a perennial crop which grows throughout the year and requires a lot of water, therefore some small holder farmers who may not be able to use irrigation facilities have not ventured into stevia production.

He however mentioned that a number of small scale farmers have expressed interest in growing the crop noting that they have irrigation infrastructure but need to be given contracts by the company promoting and marketing the production of stevia in Zambia.

The Plant Inspector noted that there were 24 farmers growing the crop a few years ago but because the company promoting stevia production mishandled the whole process, other farmers pulled out.

“The variety which these guys first introduced to farmers was performing well, then they realized that there was a new variety on the market which had a better taste profile, stevia is about the sweetness of the leaf, the sweeter the leaf, the more the market will pay for it”.

So they found a variety which was 1,000 times sweeter than the sugar that we buy. So they imposed that variety on the farmers without doing enough trial to see how it can perform in Zambia. This new one was a total failure and was flowering at a tender stage and because the farmers spent a lot of money in form of irrigation and fertilizer, they ended up asking for compensation but the company refused, so that’s how most farmers quit the crop”, he said.

Siazemo further revealed that the farmers were allowed to export the crop from 2018 to last year when the agreement expired, but with the signing of a new deal, exports will resume adding that before exports to China began, the farmers used to ship the produce to Uraguay then to China until the bilateral agreement was signed to ship the crop directly to China in 2018.

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The deal signed by Zambia and China

Tech

Foreign jobs for left out teachers not ideal as country still has deficit – PS

The Ministry of Education has disclosed that it cannot initiate the process of securing foreign teaching jobs for the teachers that were left out after the recent massive recruitment as there is still a deficit of teachers in Zambia .

Questions have arisen as to why some of the excess teachers who were left out can not be aided to go and work in other foreign countries were they have ready opening so that the teachers can start earning a living and Zambia can start benefiting from remittances. Moreover, more teachers are expected to graduate this year which will only increase the numbers of unemployed teachers.

This follows the just ended teacher recruitment were over 120,000 teachers were reported to have applied for the 2022 teacher recruitment but government only managed to recruit 30,494 teachers leaving over 70,000 teachers unemployed.

Responding to the Zambian Business Times – ZBT on why government is not facilitating for skilled labour exports as done by other countries which have huge diaspora communities across the world, the Permanent Secretary – PS at the Ministry of Education disclosed that there is still a deficit of teachers in the country.

He explained that about 115,000 teachers are needed in the country but government only managed to recruit about 30,500 because it does not have money to recruit all the needed teachers compliment. “Before we decide to export skilled teachers, there must be conscious that we still need them, but what we don’t have is the money to recruit them all, had we had the money, we would employee everybody because we need them” He said.

Kamoko was quick to mention that even if government had recruited all the teachers there was still going to be a shortfall of about 10,000 teachers. But remember that we are trying to stabilize the economy and we have to work closely with the other international partners such as the IMF. So we can’t do crazy things and then the economy is not manageable, it will mean that the same teachers will not get paid.

The employing of about 30, 500 teachers should give hope to those that are still in the streets as there is the second chance coming. The PS said very soon government will need more teachers as there are some teachers who will be retiring this year.

But again, those that want to work outside the country are free to do so. If you follow the AU, SADC and COMESA protocols, no one is restricted to look for employment outside Zambia if they follow the law. But remember again if you are going to look for employment outside the country, you must be duly registered and going abroad is not as easy as it seems, as you only go where there is need.