By Tawanda Musarurwa

HARARE – The Deposit Pro-tection Board (DPC) will soon be auctioning defunct Allied Bank Limited’s treasury bills.

The TBs held by Allied Bank – which is in the process of undergoing liquidation – were part of the wider $30 million worth of Treasury Bills that were issued by Government to several local banks in 2014.

The bills, of between two to five years, were meant to counterbalance amounts in arrears to tobacco farmers under the Reserve Bank of Zimbabwe (RBZ) Tobacco Retention Scheme.

Besides Allied Bank, other financial services providers who received the TBs included

Stanbic, Stanchart, ZB, FBC and CBZ bank, Agribank, NMB,

Metbank, Ecobank, MBCA and Barclays.

News Update as @ 1530 hours, Wednesday 15 June 2016

Feedback: bh24admin@zimpapers.co.zwEmail: bh24feedback@zimpapers.co.zw

DPC to auction Allied Bank’s TBs

DPC chief executive Mr John Chikura – and Allied Bank’s liquidator – has called on clients of the redundant bank to approach the corporation with a view to speeding up the process of issuing the TBs.

“All former clients of Allied Bank Limited who had For-eign Currency Accounts and Tobacco Retention Accounts which were later converted to Treasury Bills by the Reserve bank of Zimbabwe to contact the Liquidation Agent in order to expedite the process of issuing these Treasury Bills,” he said in a statement.

The TBs in question are half yearly coupons with a pre-scribed asset and tax exemp-tion status at an interest rate of 2 percent. And they can be used as securities on the interbank market, which resumed last year after having been invalid since 2009.

The TBs are likely to be issued through an auction bidding process as per norm. Mean-

while, the last special meeting of creditors and members of Allied Bank was held on May 5, but data on how much more claims were made on that day are yet to be unveiled.

But an earlier February meeting, claims worth over $6 million were provisionally accepted by the Master of High Court. And at the first creditors’ meeting held in June last year, 93 claims valued at $9,7 million were provision-ally accepted while 15 claims valued at $356 196, 30 were rejected for non-appearance.

The DPC’s key role to protect

depositors against loss of part or all of their deposits in case of a bank failure. The corpora-tion has however since admit-ted to facing challenges in liquidating Allied Bank because some of its debts were ceded to third parties, while most facilities granted to debtors did not have not have security had negatively impacted on the rate of recoveries.

The other key issue is that all of the bank’s immovable assets consisting of land and buildings with an original book value of $16,7 million are currently in dispute, with the matter before the courts.●

2 NEWs

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BH244

By Funny Hudzerema

HARARE -Government is targeting to reduce the cost of exporting and importing goods by at least 30 percent as part of the wider improv-ing ease of doing business programme.

Currently the cost of import-ing and exporting goods and services is expensive, result-ing in smuggling of goods at entry points creating a trade deficit for the country.

Under the agenda of improv-ing the ease of doing busi-ness environment, Govern-ment is planning to create an exporting and importing environment which attracts foreign and local investors to invest in the country and increase production.

Zimra regional manager (greater Harare) Mr Charles Jaure said the Government cluster working on paying taxes and trading across bor-

ders is targeting to reduce the cost of importing but they are being delayed by some ministries that are tak-ing time to respond to new policies and laws which they are crafting.

“Under the easy of doing business on border posts the goal is to reduce the cost of importing and exporting by 30 percent and that is the starting point but it ’s not the end.

“For the goal to be achieved we are aiming to reduce the turnaround time at our entry points for traders,” he said.

He was speaking at the ‘Second 100 Day Improving the Ease of Doing Business Environment Workshop.’

He added that one of the strategies they are exploring is the use of the single win-dow in paying duties which is in line with international best practices.

The Government has pro-jected a $3 bill ion trade deficit for the whole year. Imports are expected to decline marginally from $6,3 bill ion last year to $6,2 bil-lion this year, while exports are expected to grow to $3,7 bill ion this year from $3,4 bill ion projected last year.

Information released by the Zimbabwe National Statistics Agency (ZimStat) recently shows that imports to March amounted to $490 million against $167 million exports, which remain heavily skewed towards consumptive prod-ucts following a significant drop in raw materials impor-tation.

“Six legislations critical to improving the importation and exportation of goods have been crafted but they rare yet to be gazetted,” he said.●

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Govt aiming to reduce cost of exporting and importing by 30pc

BH246

BH247

HARARE –An increase in gold production over the past few years has resulted in a rise in demand for the precious metal from various international markets, a Cabinet Minister has said.

The gold sector in Zimbabwe is gradually recovering following a sharp decline experienced in the past decade which saw an all-time low production of three tonnes in 2008.

At peak, production reached 29 tonnes in 1999. Comment-ing on whether Zimbabwe would seek re-admittance to the London Bullion Marketing

Association (LBMA), Finance and Economic Development Minister Patrick Chinamasa said the country was keen to explore other markets. The LBMA is a wholesale market for selling gold and silver.

“There is no problem about marketing gold. There are many markets all over the world which are coming to demand to purchase our gold so that is not a headache to me,” he said.

Zimbabwe was suspended from the LBMA in 2008 after failing to meet the 10 tonnes mini-mum production requirement.

“As you know we have long since qualified. The London gold bullion qualification is that we should refine in excess of 10 tonnes.

That we have long since

achieved as I told you we are on 20,1 tonnes.”

Zimbabwe recorded a twenty one percent increase in gold production to five tonnes in the first quarter of 2016.

The increase was attributed to improved power supplies and higher deliveries from small scale miners, who accounted for 37 percent of total gold produced during the quarter. Earnings also increased by 17 percent to $189 million. Zim-babwe is targeting to produce 24 tonnes of gold this year

. - New Ziana.●

8 NEWs

Huge international demand for Zim gold

BH249

BH2410

HARARE -Sugar milling giant Tongaat Hullet has dismissed reports of a looming shortage of the commodity saying it has adequate stocks to last even up to 2017.

There have been reports on social media purporting that Tongaat Hullet operations in Zimbabwe namely Triangle and Hippo Valley Estates had stopped producing sugar.

The reports further stated that Tongaat Hullet had pulled out of Zimbabwe due to the impending introduction

of bond notes and specu-lated that the closure of sugar milling would result in shortages on the domestic market.

In a statement, Tongaat Hullet corporate affairs and communications manager Adelaide Chikunguru said the reports that the company had stopped sugar production were not true.

“We wish to assure our valued domestic and other stakeholders that adequate stocks of sugar are avail-

able to meet full domestic sugar market requirements well into the 2017 production season,” he said.

Mr Chikunguru said Tongaat Hullet remained committed to its philosophy of value creation for all its stakehold-ers through an all-inclusive approach to growth and development.

“Tongaat Hullet continues to demonstrate this commit-ment through its ongoing socio- economic development initiatives in its surrounding

rural communities and Public Private Partnership Projects,” she added.

The company is the largest that produces sugar in Zim-babwe and consists of Trian-gle and a 50,3 percent stake in Hippo Valley Estates, rep-resenting a combined sugar milling capacity of more than 640 000 tonnes.

Zimbabwe consumes between 350 000 and 400 000 tonnes of sugar per year.

- New Ziana●

Tongaat Hullet dispels sugar shortage fears

11 NEWs

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BH2413

HARARE -The local equities market continued in the red, with the mainstream indus-trial index closing at 93.66

today after a 1.42 dip.

Seed producer SeedCo weighed heavy with a

$0,0300 loss to close at $0,5200, while giant tel-ecoms Econet Wireless declined by $0,0153 to

$0,2147 and Delta Beverages slipped $0,0150 to trade at $0,5050.

On the upside were two counters namely ART Cor-poration, which rose by $0,0028 to close at $0,0168 and meats processor Col-com which added $0,0025 to $0,1630.

Activity continues to be rather subdued on the local bourse as 15 counters traded today, and turnover amounted to $123 749.

The mining index was again flat at 26.24 as Bindura, Falgold, Hwange and RioZim all remaine unchanged on previous price levels at $0,0120, $0,0050, $0,0300 and $0,1700, respectively

- BH24 Reporter ●

Equities continue on negative path

14 ZsE

BH2415

MovERs CHANGE ToDAy PRiCE UsC sHAKERs CHANGE ToDAy PRiCE UsC

ART 20.00 1.68 ECONET -1.53 21.47

COLCOM 1.55 16.30 SEEDCO -3.00 52.00

DELTA -1.50 50.50

iNDEx PREvioUs ToDAy MovE CHANGE

INDUSTRIAL 95.08 93.66 -1.42 points -1.49%

MINING 26.24 26.24 +0.00 POINTS +0.00%

16 ZsE TABlEs

ZsE

iNDiCEs

stock Exchange

Previous

today

17 DiARy oF EvENTs

The black arrow indicate level of load shedding across the country.

PoWER GENERATioN sTATs

Gen Station

15 June 2016

Energy

(Megawatts)

Hwange 588 MW

Kariba 602 MW

Harare 30 MW

Munyati 19 MW

Bulawayo 23 MW

Imports 0 - 400 MW

Total 1399 MW

16 JUNE 2016 -- RioZim 60th Annual General Meeting; Place: No. 1 Kenilworth Road, Highlands, Harare; Time: 10.30 hours...

22 JUNE 2016 -- Zimre Holdings limited 18th Annual General Meeting; Place: NiCoZDiAMoND Auditorium, 7th Floor insur-ance Centre, 30 samora Machel Avenue, Harare; Time: 1430 hours...

22 JUNE 2016 -- GB Holdings limited Annual General Meeting; Place: Cernol Chemicals Boardroom, 111 Dagenham Road, Wil-lowvale, Harare; Time: 11.30 hours...

23 JUNE 2016 -- Zimpapers 89th Annual General Meeting; Place: Zimpapers ltd Boardroom, sixth Floor Herald House, Cnr. G. silundika/sam Nujoma street, Harare; Time: 1200hrs…

24 JUNE 2016 -- Dawn Properties Annual General Meeting; Place: Great indaba Room, at the Monomotapa Hotel, 54 Parklane, Harare on Friday; Time: 10:00 hours...

22 JUNE -- lafarge Cement Zimbabwe Annual General Meeting; Place: Manresa Club, Arcturus Road, Harare; Time: 10:30hrs

THE BH24 DiARy

JoHANNEsBURG - South Africa's rand stayed on the back foot against the dollar early on Wednesday a day after central bank data showed a wider-than-ex-pected current account deficit.

By 0711 GMT the rand was at 15,2850 against the greenback, little changed from its New York close at 15,3040 in the previous

session.

The local currency had fallen as much as 1,5 percent to its weakest in more than a week on Tuesday after the South African Reserve Bank said the current account deficit widened to 5 percent of GDP in the first quarter of this year 4,6 percent.

Government bonds edged higher, and the yield for

the benchmark instrument maturing in 2026 eased 3 basis points to 9,17 percent.

South Africa relies heavily on portfolio flows to plug its current account short-fall, making the rand more vulnerable than its emerg-ing market peers when risk appetite wanes.

"Local data this week has not provided any comfort for the local unit and this, long with markets bracing for a number of significant events, has seen the rand remain firmly under pres-sure," Nedbank said in a

market commentary.

Traders and analysts said markets were focused mainly on the US Federal Reserve's policy meeting later on Wednesday while the prospect of Britons vot-ing to leave the European Union at a June 23 referen-dum had dampened risk appetite.

On the equity market, the JSE exchange's All-Share index was up 1 percent in early trade, while the benchmark Top-40 index added 0,9 percent. - Reu-ters●

18

Nigeria to announce flexible currency regime today

Rand on shaky ground after current account gap widensREGioNAl NEWs

ABUJA - Nigeria's cen-tral bank will announce a more flexible foreign currency policy today, a bank spokesman said on yesterday.

Last month the central bank said it would move away from a peg of the

naira to the dollar but has not given any details yet. Central bank governor Godwin Emefiele will unveil the new policies at a news conference, the spokesman said

- Reuters●

Gold held near its highest level in more than five weeks as risk aversion weighed on financial markets ahead of Britain’s vote on whether to leave the European Union, sending investors to haven assets. The sterling price of bullion traded near the high-est close since 2013.

Bullion for immediate deliv-ery was little changed at $1 286,30 an ounce by 2:32 p.m. in Singapore, according to Bloomberg generic pricing. The metal touched $1 289,97 on Tuesday, the highest intraday level since May 6, capping five straight days of gains. Prices have climbed 21 percent this year.

Bottom of Form

Gold is benefiting from mounting investor concern before Britain’s June 23 ref-erendum, which has sparked a slump in global stocks. The metal may hit $1 350 in the days and weeks following an exit vote, Georgette Boele, an analyst at ABN Amro Group NV, said in a report. Central bankers in the US and Japan are meeting on

monetary policy this week.

Futures traders ruled out any chance of a rate hike when the Federal Reserve ends its meeting Wednesday, with odds of a December increase at less than 50 percent.

Poll Angst

“Gold has been stepping up on a combination of lower

Fed hike odds and increased haven demand,” Bernard Aw, a strategist at IG Asia Pte, said by e-mail.

“Investors are becoming more fearful of Brexit risk as recent polls showed the ‘Leave’ camp is commanding a lead, and the increased uncertainty is driving them to allocate more to safe haven assets, including

gold.”

Five polls put the ‘Leave’ campaign ahead, and the Sun, Britain’s best-selling newspaper, backed a Brexit on its front page. Gold priced in sterling fell 0,4 percent to 907,63 pounds ($1,286.43) after touching 912,99 pounds Tuesday, the highest since August 2013. - Bloomb-erg●

19

Gold holds near five-week high as Brexit concerns spur demand

iNTERNATioNAl NEWs

By Nigel Gambanga

In one of our recent posts that looked at workarounds to the current cash crisis in Zimba-bwe, we highlighted the use of online retailers that accept electronic payments as a way of avoiding the use of cash.

As it gets harder to withdraw money from bank accounts or to cash it out from mobile money agents, the services that already rely on electronic payments could position them-selves for greater visibility.

All this stems from the fact that consumers, faced with the need to make certain purchasing decisions (for example grocer-ies) will increasingly look at cashless alternatives.

They are likely to become comfortable with any of these services as they adapt to elec-tronic transactions, but only as long as products or services are delivered and customers can bank on the reliability of service providers.

Credit won’t be for the cash crisis only

As much as the crisis seems likely to drive consumers into buying goods online, there are other factors at play. In the past 5 years, the local e-com-merce scene has undergone a number of changes that have prepared it for the emergence of e-commerce services.

Electronic payments and digital money have been democratised by the rise of mobile money phenomenon that has opened up mobile money to over 7 million Zimbabweans making it easier to state the case for virtual transactions than it ever was.

This was also supported by the evolution and emergence of online payment channels like Paynow that have been moulded around the demands of the local market.

At the same time, internet pen-etration has jumped from 11,5 percent in 2011 to 46,6 percent at the end of last year, opening

up a larger segment of the pop-ulation to the internet and its opportunities for commerce.

A handful of startups and tradi-tional brick and mortar busi-nesses took advantage of these factors and launched their own e-commerce platforms and the viability of that same collective of e-commerce businesses has been a validation of how this way of doing business can actu-ally work locally.

With all these factors in place plus the usual list of pre-req-uisites for a boom in trading online, it’s always seemed like Zimbabwe was one step away from a rise in e-commerce.

For e-Commerce in Zimbabwe to take off, it will still need another nudge

Perhaps a cash crisis is what will light the fire and bring Zimbabwean offline consumers online, but it won’t happen on its own.

While services and offline businesses that haven’t gotten

into online retailing might want to experiment with it now, the businesses and startups that currently exist as the nota-ble e-commerce platforms in Zimbabwe need to capitalise on what is happening in the envi-ronment right now.

An aggressive marketing drive that sells the convenience of a cashless consumer experience could help acquire new cus-tomers, something that every startup has come to understand as being expensive.

This could be done with dis-counts, free deliveries, the creation of a presence in offline media or even loyalty systems for customers who sign up for their services now. It all depends on what sort of online retailing abusiness is involved in.

With a lot of effort and strat-egy and some luck, this could be the start of a new chapter in online retailing and e-com-merce in Zimbabwe, inspired by a cash crisis. – TechZim●

20 analysis20 ANAlysis

Zimbabwe’s cash crisis could ignite boom in online retailing