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Chililabombwe based Lubambe copper mines - LCM

Zambia still struggling to close wheat deficit-MAZ

The Millers Association of Zambia (MAZ) says the country has been experiencing a wheat deficit for the last 10 years, which it has been cushioning through imports to ensure that there is smooth trade on the domestic market.

Association President Andrew Chintala has refuted statements that the country is producing enough wheat for consumption adding that the association is ready to stop importing wheat once there is sufficient increase in production.

Speaking in an interview with the Zambian Business Times-ZBT, Chintala said there is a readily available market for wheat and the millers are the biggest consumers of wheat locally with a huge demand from countries like the Democratic Republic of Congo (DRC) and Malawi, which do not produce much wheat.

Chintala explained that the association engages all the stakeholders including farmers before deciding to bring in any wheat imports noting that the stakeholders establish how much the country needs and how much is available locally then import the difference based on the consensus of all stakeholders in the value chain.

“They may have the potential to be able to increase their production but not until we get to a level or to a time when the country becomes self-reliant, then am sure that argument can start but as it is we do not just import without their consent. It is the farmers, the millers and the traders that sit and deliberate on the matter and establish the requirement in terms of the short fall and that is what we present to government”, he said.

He noted that the association is mindful of the fact that it needs to protect the local industry that is why it is working together with all value chain players so that they create an enabling environment conducive for all stakeholders.

Chintala said the African Continental Free Trade Area (AfCFTA) agreement would open up many opportunities for farmers, producers and all players in the food value chain therefore the country should start positioning itself to take advantage of the opportunities the AfCFTA agreement will bring.

The Association President mentioned that MAZ has so far imported approximately 60% of the total 100, 000 metric tonnes of wheat that government allowed the association to import.

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The Millers Association of Zambia (MAZ) says

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10 institutions caught forging TEVETA certificates to access CDF

The Technical Education, Vocational and Entrepreneurship Training Authority – TEVETA has disclosed that about ten (10) institutions have been caught forging its registration certificates, purporting that they are registered to fraudulently access constituency development funds – CDF.

TEVETA revealed that it has been put as a requirement for students to be sponsored under the constituency development fund that the institution a particular student is applying from should be registered with Teveta, because there is an amount called CDF Teveta bursary meant for students who want to go into Teveta institutions.

Manager corporate affairs at TEVETA Siachiyako Clive stated that the students in these institution are drawn from different constituencies and the respective constituency paid to the purported institutions.

In an interview with the Zambian Business Times – ZBT, TEVETA corporate affairs manager said the constituencies were different students are coming from had no reason not to pay because documents purporting that they were registered with Teveta were presented to them.

He said that the constituencies will get their money back, and the institutions involved in this matter will be reported to Police so that they can be persecuted, he added that the court will decide on what happens to them after wards weather they will pay all the affected students or not, “our immediate interest is that the they are reported to the police as per procedure then the national persecution authority picks up their role”, he said.

Among the ten (10) institutions that have been alleged to be in this dubious act, is Pascal operating training institute in Ndola, pabrob operators training institute in Ndola and heavy duty operators which is in Ndola, Kitwe and other campuses.

Siachiyako said that the ward development committees are supposed to sieve, by getting in touch with Teveta, he said some of the committees are able to get in touch with Teveta and clarify if a particular institution which has been presented is registered and Teveta is able to clarify.” Some of them I don’t know if its oversight or probably not paying attention, they ended up paying”, he confirmed.

Permanent Secretary in charge of Administration, Ministry of Local government and rural development, Maambo Haamaundu said some of the culprits pretend to be him or the minster and some would even go up to the point of suggesting that they spoke to the president.

He said the ministry is taking all the necessary measures and any such activity were criminality is suspected, the ministry is reporting to the police and Zicta for further prosecution. Procedures to accessing CDF have been cited as a major bottleneck behind the low disbursement levels which is partly blamed for low liquidity or no money in circulation.

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Edible oil refiners opposes export of 100k tons of soya beans

The Crushers and Edible Oil Refiners Association (CEDORA) has revealed that they oppose the decision made by Oilseed stakeholders to export 100, 000 tonnes of raw soya beans when the country has installed capacity to process all the soya produced this year.

CEDORA Director Aubrey Chibumba said the decision is rushed, as processors have not been given an opportunity to acquire the soya beans needed for processing of cooking oil and other products locally.

Speaking in an exclusive interview with the Zambian Business Times – ZBT, Chibumba said the stakeholders did not consider the fact that of the 411, 000 metric tonnes of soya beans that was produced last season, only 40, 000 metric tonnes was exported which means 371, 000 tonnes of soya beans was consumed locally.

So if last year 2021, 371,000 tons of soya was consumed locally, where has the computation or estimation of the 280, 000 metric tonnes which has now been reserved for domestic consumption this year 2022 come from?. The 280,000 is far less than what was consumed locally last year.

Chibumba told ZBT that CEDORA has written to the Ministry of Agriculture and stated its position that there is a potential of exporting a maximum of 40, 000 metric tonnes of soya beans and the rest should be left for the domestic market.

He noted that the decision to allow the export of initially about 30, 000 metric tonnes of soya beans with a review later on of possibly increasing if the need arises was reached at the last stock monitoring committe meeting adding that it would be wrong for the public to think there is enough soya beans for the country to allow the export of 100, 000 tons.

“You ignore all those things and just simply say that we are going to export 100, 000 tonnes. Some people just want to manipulate the value chain for whatever reasons of their own, so we refused to sign that statement”, he said.

Chibumba said the association members currently has installed capacity of a million tonnes of Soya, so the country can process the whole 475, 000 metric tonnes of soya beans that has been produced this year, but some people in the value chain need to trade soya beans for their own reasons or interests.

He explained that it is understandable that everyone in the value chain has to benefit but the association members has invested over $500 million to put up crushing and manufacturing facilities in Zambia but people who have not made any investment are trying to dictate what happens in the sector which should not be allowed.

“In every other sector, the emphasis is on value addition so why should this be different, we have got the capacity to process all the produce but we don’t want to look as if we are trying to manipulate the prices, so we understand that a reasonable quantity of beans could be exported”, he said.

Analysts say it’s better for a country to meet its local demand first before exporting the excess especially with the reported looming shortage of food on the back of the Russia – Ukraine conflict. Cooking oil, soya cake and stock feed which are value added products can then be exported to earn the country much more than the projected $63 million from exporting raw and unprocessed soya beans.

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The Crushers and Edible Oil Refiners Association

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New ZESCO – CEC bulk supply agreement to remain secret

Calls to make public and disclose the tariffs that have been agreed for the new Bulk Supply Agreement – BSA between ZESCO and Copperbelt Energy Corporation – CEC that has been given a go ahead by the Energy Regulation Board – ERB risk being frustrated.

Despite ZESCO who are state owned and a public institution generating the power and facing financial difficulties due to a history of entering into deals that are suboptimal and inimical to its long term interest, the power utility under the new management is set to repeat the same mistakes of the past.

The last BSA between the two companies that expired on 31 March 2020 was not renewed after ZESCO management revealed that the long term agreement had been a drain as CEC had contracted to purchase power at knock down rates below ZESCO cost of production while it was reselling the power to the mines at supernormal profits.

And efforts by the Zambian Business Times – ZBT to find out if the new BSA contract would be made public are indicating that the new ZESCO management and CEC management are determined to keep the document secrete, a scenario that has led to speculation that the contents may raise public anger.

An internal source who spoke to ZBT but requested to remain anonymous revealed that the contract shall not be shared to the public, stating that it is confidential between the two parties. This is despite the fact that the power being bought is from a public or state owned utility.

The source further said in the case of the BSA, there is the Electricity Act which mandate that the document is shared with the Energy Regulation Board for review and approval, but beyond that, there is no obligation on the part of the two parties [ZESCO and CEC] to share the document with other key stakeholders or to members of the public, the source said.

“If the details of the document were to be shared with the public, it would be the decision between ZESCO and CEC, but if not, this contract is not supposed to be shared as its strictly confidential” stated the source.

Further efforts by ZBT to speak to senior ZESCO staff to get assurance that the contract is in the best interest of the general public and that CEC has not yet again obtained a deal that is good for them and adverse to ZESCO proved futile as the document and tariffs therein have not been shared even internally with most senior staff members.

New ZESCO Managing Director Victor Mapani has been challenged to make the agreement public as ZESCO is a public institution whose dealings should be above board. Already, ZESCO has no publicly available audited financial statements, with indications that they are behind by over five years.

The mere fact that ZESCO is opting to keep this agreement secrete raises further suspicion as to weather this deal is above board. Good corporate governance demands that this agreement be made public owing to the revelations that this deal was partly responsible for the financial troubles ZESCO has been going through over the past years.

The CEC and ZESCO previous expired BSA bulk supply agreement brought a lot of public discussions among the citizenry with allegtions from the ZESCO management that CEC was a mere Middleman company that was merely profiteering and sucking value out of ZESCO’s power generation.

It was argued that CEC should have just been paid wheeling charges for use of their infrastructure to transport power leaving ZESCO to directly negotiate tariffs with end users. ZESCO reporter that they already supplied power to North – Western Province based mines at more profitable rates and were losing money on power supplied the Copperbelt base mines and customers through CEC.

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Calls to make public and disclose the

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Masebo has no capacity to run MOH – Resident Doctors

Resident Doctors Association of Zambia – RDAZ President Dr. Brian Sampa has disclosed that the issues popping up at the Ministry of Health – MOH and it’s key institutions such as the University Teaching Hospital – UTH are no longer about money, but about the quality of management and leadership.

Dr. Sampa stated that it’s not about money because the new dawn government keeps on announcing billions of money being released. Moreover, this is the only government which has managed to release K3.3 billion for medical supplies, thus it is not about money but about the management challenges at the ministry.

The RDAZ President said that the Minister has lamentably failed, thus the issue of management at the ministry requires the intervention of the President. The minister has no capacity to run the ministry at this moment, it’s like it’s complicated for her.

In an exclusive interview with the Zambian Business Times – ZBT, Dr. Sampa said Ministry of Health is so critical such that it’s smooth operations boarders on national security, it’s very cardinal and the goodwill of the president may be tarnished just because of one ministry”.

The current Health Minister [Sylvia Masebo] who is also Chongwe member of parliament has shown several times that she does not believe that we have a problem in MOH, she believes whatever people are talking about are just insinuations from people who are not happy”, RDAZ has revealed.

Dr. Sampa says Zambia has a collapsing health system and things are not okay, these are things always talked about but no one seems to be paying attention. He said the suspension of full blood count testing by the University Teaching Hospital under the department of pathology and microbiology is just a tip of an iceberg, because others areas are also in crisis. The CT scans are not working, the X-ray machines are not working, the ultra sound machines etc have challenges.

He further re-iterated that there are no drugs and needles among other things in most public health institutions. Dr. Sampa added that if one has a fracture and goes to the hospital today, there will be need for one to buy his/her own bandage and cotton wool among others. He told ZBT that at cancer hospital, people are dying because the drugs are not there.

UTH has today through a statement announced the suspension of full blood count testing – a basic and essential procedure – attributing the suspension of the service to the lack of reagents for instruments. The statement from UTH further stated that until the department of pathology and microbiology receives the needed reagents, it cannot predict when testing will be resumed.

Efforts to get a comment from the health Minister Sylvia Masebo proved futile by press time.

June 9, 2022

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Inflation dropping because people have no money – Economist

Former Economic Association of Zambia – EAZ President Lubinda Haabazoka has observed that “People don’t have money and that’s why inflation is slowing”.

Haabazoka stated that because people don’t have money, “people can’t import goods that’s why the exchange rate is strong and so where there is no money there is reduced consumption which means companies that produce goods and services have no business. That can lead to lack of employment, people won’t be employed because there is no demand for goods and services being produced”, he said.

The economist said “payments are taking time; they are dragging, so there is no efficiency for what is happening, people should be paid promptly because those are businesses. He also called for companies to find ways to move away from supplying government so that there is no or limited dependency on government for business”.

He stated that one of the reasons why the economy has continued to experience low liquidity were most people are saying there is “no money in circulation” is because many suppliers of government goods and services remain unpaid.

Haabazoka explained that nonpayment of money owed to suppliers has resulted in reduced economic activities and the trickle-down effect is that employees remain unpaid and there is reduced consumption of goods, which means companies that produce goods have also been affected, as there is no business.

Speaking in an exclusive interview with the Zambian Business Times-ZBT, Haabazoka welcomed governments’ release of K368.8 million in May 2022, which was channeled towards dismantling liabilities or arrears for goods and services previously supplied to government.

He however noted that what was released towards the payment of suppliers is minimal compared to the billions of kwacha that the suppliers are owed therefore government should speed up the process of dismantling the arrears owed to suppliers so that the economy can start running.

June 9, 2022

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ZRA mute on allegations of paying out excessive tax refunds to mines

The Zambia Revenue Authority – ZRA has opted to remain mute on allegations that government is paying out excessive tax refunds and dedicating excessive resources to dismantling the controversial VAT refunds to the mining companies resulting in the current liquidity (no money in circulation) challenges being experienced across the country.

Efforts by the Zambian Business Times – ZBT to get official responses on the allegations from ZRA on the VAT and other tax refunds that have been paid out for the first quarter of 2022 as well as the net tax revenue position from the mining sector have proved futile.

Zambia’s Copper mining sector represents over 70% of the country’s total export, copper is currently trading around US$9,600 per ton, a price point considered to be among the best times and yet that country does not seem to be getting the much needed trickle down effect.

Most business leaders have indicated that their companies are facing low demand for goods, depressed sells and a general atmosphere of low spending power and low liquidity (no money in circulation) challenges. The upward fuel price adjustments have exacerbated the cost of living in Zambia further dampening consumer demand.

The Zambia Revenue Authority (ZRA) had earlier reported that it recorded an increase in mining company tax collections for the period January to April 2022 compared to the same period in 2021. But their report was short of stating the net tax positions, as allegations are that ZRA is picking up reduced net tax positions after paying out VAT and other forms of tax refunds.

There are growing allegations that ZRA is paying out more to mines in form of tax refunds compared to how much the agency is making from tax collections, the net position is alleged to be deteriorating, which is shocking at a time when there are better international copper prices.

Economist Yusuf Dodia told the Zambian Business Times – ZBT that government is struggling to pay off Value Added Tax (VAT) refunds to mining companies as it has a huge debt to the mining firms where VAT refunds are concerned. There has been no public audit conducted to verify the outstanding VAT refunds debt.

Zambia had in 2020 paid K8.5 billion in value added tax refunds to mining companies and according to the Zambia Revenue Authority, government was owing K7.1 billion in VAT refunds to mining companies as of January 2021.

The government economic management team at the Ministry of Finance and Bank of Zambia have all indicated that getting an IMF deal remains the one and only viable way out, but countries like Ghana that had gotten on similar program continued to experience harsh economic conditions for the majority of their population to an extent were they abandoned the IMF program before it ended.

Further efforts to get a comment from ZRA on how much the authority has paid out to mining companies in terms of VAT refunds proved futile as press queries sent to the authority’s Acting Corporate Communications Manager Oliver Nzala proved futile by press time.

June 9, 2022

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Kwacha appreciation hurts local Tobacco outgrower farmers

If you thought the Kwacha appreciation is good for everyone, think again as exporters and manufacturers take a hit whenever the local unit gains against major convertible currencies such as the US dollar.

One such crop which has about 90% of its output exported and earns the Zambian economy the much needed forex is tobacco. This crop has an extensive outgrower farming community which the Tobacco Association of Zambia estimated to be over 16,000 farmers.

This large number of local outgrower farmers that sell in Kwacha to off-takers such as Japan Tobacco International – JTI, Tombwe, Alliance One etc have been hurt by dropping Kwacha prices this year following the appreciation of the Kwacha.

One of the top five Tobacco Processing and Trading companies in Zambia has disclosed that the local prices of tobacco have gone down this year due to mostly the appreciation of the kwacha, a situation that is being interpreted negatively by most outgrower local farmers.

A source who asked to remain anonymous due to the sensitivity of the matter explained that tobacco which is mainly exported is fetching for less in Kwacha terms this year compared to last year because the kwacha to a dollar exchange rate was around K21 per dollar in 2021 but is now trading around K17 per dollar, meaning that even if the prices for export have been maintained in dollar terms, the local farmers will get less Kwacha sells revenues .

Speaking in an exclusive interview with the Zambian Business Times – ZBT, the source explained that tobacco is a crop that needs to be handled carefully because if not cured properly, the crop can be sold for a very low price. The source noted that how much one gets for their tobacco harvest is heavily dependent on the quality, adding that the best quality is currently selling around K76 per kg or $4.5 per kg.

“You can have a big leaf in the field but if not cured properly, you can sell it as low as K2.70. The best grade was K84 in April 2022 but now it’s about K76 as the exchange rate is now at K17, last year, the same quality and quantity of leaf was going for around K110 when the exchange rate was around K21 “, the source said.

The source said a thin leaf was K77 per kg for the best quality when the exchange rate was around K18 but now that the kwacha has slightly appreciated, the same crop would earn the farmer around K64 per kag now.

With Commercial farmers, the outlook may be different as most of these farmers are able to hedge as sell in dollars as well as have dollar denominated cost of production structures and financing facilities. The local financial services industry is yet to come up with tailored solutions for small, medium and emerging outgrower farmers who end up taking up the exchange losses.

Zambia has continued to lag behind its Neighbours Malawi and Zimbabwe as far as Tobacco production and exports are concerned, with analysts challenging government to grow Zambia’s share of the lucrative global export quotas.

June 9, 2022

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If you thought the Kwacha appreciation is