The AXiS XLI

The ZIMCODD speaks out on debt crisis
Beyond artisinal mining
How Zim can create a SWF
Invictus expands exploration footprint

Winning battles, losing wars

DEBT

#Issue: XLI

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CONTENTS The AXiS XLI 19 August 2022

Economic News & Analysis

4 Currency stability a priority as election fever kicks in
5 ZIMCODD speaks out on debt crisis: government

boarding the wrong flight
7 SWF: How Zim can adopt a fund to manage gold revenues
8 Beyond artisinal mining: Zimbabwe struggles for immediate

gratification and long-term sustainable growth
9 Fact or Fiction: The RBZ’s roadmap towards

strategic transformation
12 Government : The chief architect of prevailing macroeconomic

volatility

The Cover Business News & Insights

Much to the unexpecting populace, the Central 10 Invictus Energy : Expands exploration footprint in Cabora Bassa
Bank seems to have won the battle in stabilizing 11 The Rolex Way: Lessons for non-profit organisations
the infamous local currency, ZWL.However, has 13 Meikles kick-start 2022 fiscal year bullish
the RBZ won the war or just the battle on one 14 OK Zim calls for a market-determined foreign exchange
front?
pricing system
ZIMCODD speaks out on debt crisis 14 CAFCA Cables firm chronicles an 8.2% increase in export volumes

AFRODAD and ZIMCODD say the government is Markets
scratching where it is not itching as it battles to
service the accumulating debt, both from 18 Markets Watch
external and internal creditors. 19 ZSE Weekly Commentary
22 Financial Markets at a Glance
Beyond artisinal mining 21 Weekly Commodity Pulse

In recent periods mines like Blanket, have World News
attracted huge capital investment which has
increased mine life. What Zimbabwe needs at 15 Politics around the world
the moment to unlock its potential in mining is 17 Business around the world
attracting long term investments into mining
which is able to go beyond what artisans are ZSE ASI 15,302.35 ZSE TOP 10 9,303.29 MEDIUM CAP INDEX 31,282.13 ZSE TOP 15 10,325.99 SMALL CAP INDEX 514,120.14 ZWL INTERBANK 478.1262
doing 15,129.49 9,154.38 31,257.30 10,169.93 519,398.75 481.8543
15,093.23 9,151.60 31,065.16 10,157.30 502,399.19 485.4088
Invictus expands exploration footprint 14,821.96 8,990.45 30,448.09 9,978.43 519,211.55 488.6269
in Cabora Bassa 14,687.84 8,905.13 30,309.56 9,893.76 503,546.76 493.0657
14,438.57 8,736.23 30,031.81 9,711.91 490,639.15 498.5334
Australian Securities Exchange (ASX)- listed oil -5.64% -6.10% -4.00% -5.95% -4.57% 4.27%
and gas firm Invictus Energy has picked up two
more exploration rights in Zimbabwe’s Cabora
Bassa Basin, expanding its licence footprint in
the Southern African country.



The AXiS XLI Friday 19 Aug 2022 4

& Analysis

Currency Stability

A Priority As Election Fever Kicks In

M uch to the unexpecting populace, the The Central Bank decided to mop up liquidity in ing with it through erosion of the existing premi-
Central Bank seems to have won the the market and reduce money supply, hence um between the parallel market and the inter-
battle to save the Zim dollar, at least reduce spend and savings. The RBZ introduced bank market. . The premium between the 2 mar-
on a short-term spectre. For the first time in the Mosi-oa-Tunya gold coins which were sold to kets has been reduced from above 100% to
over a year, the ZWL has appreciated against the public in both local and foreign currency, with around 60%. If the 2 exchange rates possibly
the US$ on the black market, a parallel market a lock-up period of 6-months. Of the coins sold converge, the viability of the parallel market
to the official currency markets namely the so far, 90% of the transactions were reportedly which has become a full-time job for chancers
Interbank Currency Market or Willing Buyer local currency denominated. This has resulted in would cease like the ZSE. It will be up to the
Willing Seller Currency Market, and the Reu- mopping up of an excess of ZWL3 billion from Central Bank to sustain such a balance through
ters Currency Auction Market. However, has circulation. To ensure success of the mop-up exer- measures that may include floating the exchange
the RBZ won the war or just the battle at one cise, the government went on to o suspend pay- rates.
front? ments to contractors in local currency. The Central When the RBZ introduced the gold coins, specu-
Bank also raised borrowing costs to all-time highs
The interbank exchange rate for lative buyers jumped to dispose of their
the ZWL has gone up by a stag- government borrowing. These measures come, USD’s on the parallel market and got
gering 356% on the auction however, at the expense of overall economic local money at twice the value of the
market since the beginning of growth as businesses require liquidity to operate formal currency markets. They then pur-
the year, from ZWL108.666 to on a daily basis while consumer spend positively chased the gold coins while anticipating to
ZWL494.988 per each US$, ren- impacts GDP growth. liquidate in foreign currency and benefit
dering the ZWL as the most vol- Researches have shown that inflationary pressures from arbitrage. At the point of liquidating
atile currency in the world. On were worsened by government actions in the past. in 6-months, there were projections of
the parallel market, the exchange These included payments to contractors in local another rampant currency volatility as the
rate has gone up by a whopping currency at a time when accessing foreign curren- RBZ will either pay large sums of local
275%. Annual consumer price cy on the auction market was gruesome. Compa- currency to gold coin holders, or buy
inflation closed at 256.9% in nies would opt for foreign currency for value USD’s on auction market to pay gold coin
July, which is the worst in the preservation and restocking as suppliers, local and holders, either of which would result in
world. The exchange rate has foreign based, demanded foreign currency. The the mopped-up liquidity going back into
been growing at an average of government was also excessively printing money circulation. However, as 2023 presidential
5% in each respective week on and injecting into the economy through govern- elections are nigh, the government has
the auction market as confidence ment spend and this was leading to abundance of tightened screws on loose ends. The RBZ
in the government as a whole the ZWL. It is a basic requirement for anything recently announced the issuance of smaller
continued to dwindle each day. to be scarce if it seeks to fetch value. denominations of gold coins in November,
This is indicated by the depres- “There were no elections to consider” would be roughly 2-months before the lapsing of the
sion in all formal markets, an ideal response. The Central Bank seeks to 6-months lock-up period for the first batch
including formal banking chan- eradicate the parallel market by directly compet- of gold coins. This means after mopping
nels and the regulated stock up liquidity from elites as gold coins were
market, the Zimbabwe Stock too expensive for the generality, the exer-
Exchange (ZSE). The ZSE has cise will be extended to minorities and
shed off -70% in US$ terms on proceeds of which will be used to pay
a year-to-date basis, with the back elites while pinning down on liquidi-
losses being recorded in the past ty.
3-months following the interven- However, gold coins alone were not very signifi-
tion of the government in the markets. This has cant in stabilizing the currency as the proceeds
turned the once hailed stock market into the so far represent a minute fraction of the aggre-
world worst performing bourse. The formal gate money supply. Other measures of liquidity
banking channels have also suffered reduced mop-up buttressed the target, and these include
confidence as seen by an estimated 40% foot- the suspension of payments to contractors.
hold of foreign currency on the aggregate Therefore, sustaining the current currency stabili-
money supply, with, however, less than half of ty would require not paying contractors, a move
it being transacted in formal channels as the that is unrealistic. On another angle, gold pro-
general populace prefer storing the money ducers of the gold utilized in minting gold coins
under the pillow. will also need to be paid. The payment will
either be in local currency or foreign currency.
The government has issued hundreds of statuto- Foreign currency receipts from exports are
ry instruments over the past 2 years, meant to evidently insufficient to service all the local
curb currency depreciation and rampant infla- creditors.
tion. Despite the dire enforcement of some of Therefore, the government would have to resort
these instruments, the currency disease has only to the auction market for access to foreign cur-
been worsening. Some of the measures have rency, pumping out the local currency currently
proved to work in the very short-term before held in reserves. Either way, money supply
reality kicked in- weak fundamentals can not be growth is imminent in the medium to long-term.
addressed by words but by strengthening the With almost a year to the next elections, will
fundamentals. Of recent, the government, the government play cat and mouse with the cur-
through the Central Bank, decided to follow a rency and win the race? Realistically, you can
different route from the common blank Statuto- not rig fundamentals.
ry Instruments route.

5 The AXiS XLI Friday 19 Aug 2022

ZIMCODD speaks out on debt crisis

Government boarding the wrong flight

T he African Forum and Network The government, in the mid-term fiscal
on Debt and Development(A- policy, blamed the Russia-Ukraine war
FRODAD) in partnership with its and COVID-19 impacts on debt accu-
sister organisation, Zimbabwe Coalition mulation. However, the Grade 7 Logic
on Debt and Development (ZIMCODD) tells that this is a big construction of
say the government is scratching where reality as the debt was even there
it is not itching as it battles to service before these crises. The two crises just
the accumulating debt, both from exter- exacerbated the debt crisis. According
nal and internal creditors. to ZIMCODD, by 2019, before the
Official figures show that Zimbabwe’s COVID-19 crisis, about 17 countries in
arrears are now exceeding the actual Africa were already at debt risk, with
debts putting the nation on a record of Zambia included.
failure to service its debts. The first
country post-COVID-19 pandemic to Conversely, AFRODAD and ZIMCODD estimat- ZIMCODD’s analysis of the 2018 Zim-
default on debt servicing in Africa was ed that the debt has already surpassed both babwe Auditor General report shows
Zambia, but due to political and eco- US$13 billion and US$19 billion due to the lack that the year president Mnangagwa took
nomic reforms, it quickly got a bailout of a formal protocol by the government when to power, transactions worth US$5.8
from the International Monetary Fund. borrowing putting it around US$22 billion. That billion were made with financial irregu-
During its conference on African Debt has led an independent Economist, Gerald larities ranging from unsupported expenditure,
and Development held on the 16th of August, Macheka to put the debt figure above US$25 excess expenditure, outstanding payments to suppli-
the Organisations said the elephant in the house billion due to these debt discrepancies. ers of goods and services, transfers of funds with-
acting as a barrier to debt servicing is a lack of The government is not only accumulating debts out treasury approval among other issues. This
debt transparency and a lack of reforms, particu- externally but also has huge debts locally. The constituted about 82% of government expenditure
larly concerning Zimbabwe Democracy and domestic debt according to official data has for the year.
Economic Recovery Act (ZIDERA). accrued to ZW$1.3 trillion as of June 2021 and The debt crisis continues to be the elephant in the
According to ZIMCODD, the problem that is it is not clear if the government haven’t bor- room, restricting economic growth both at macro-
resulting in the failure to service debts is a gov- rowed between that period to June 2022. The and micro levels as it impedes access to low-cost
ernance problem. There is no transparency on huge debt is due to fiscal indiscipline as the and long-term financing necessary to support the
what the nation owes to foreign debtors. As of government continues to bite what it cannot desired medium to long-term growth.
31 December 2021, the nation had an external chew as it battles to finance its campaign proj- To address the debt crisis, the government has
debt of circa US$14.5 billion and by June 2022, ects. Due to a lack of debt transparency, the developed the Arrears Clearance, Debt Relief and
the debt was reduced to US$13.153. Surprising- debt might even be around ZW$4 trillion due to Restructuring (ACDRR) Strategy aimed at restoring
ly, the government did not communicate to have some hidden debts which are not disclosed, debt sustainability and has been hiring lobbyists
been paid such an amount of debt servicing put- clothed in the name of donations, especially and using the state media to propagate propaganda
ting doubt on the credibility of the govern- from China. History shows that China doesn’t that there are political rooms currently being done
ment’s figures. Of more interesting are other offer free cows. by the Second Republic yet there are not. These
reflections according to AFRODAD research The government’s problem is not that of bor- debt strategies have been already there. In 2015,
which says only up to US$60 million was paid rowing as no country survives without borrow- the government enacted the Debt Clearance Plan
up to now by the government as debt servicing ing but Zimbabwe has a spending problem that and in the NDS1, the government also set the debt
contradicting the US$1.2 billion reduction. is not subject to the highest law of the land. clearance plan which is both failing to yield
That gives a headache to the actual figure that Government has a tendency of borrowing side- results. In line with the ACDRR Strategy roadmap,
the nation owes to external creditors. The latest lining the parliament. It exceeds the budget allo- the African Development Bank’s President, Dr A.
mid-term budget released shows that Zimbabwe cated by the parliament without the parliament’s Adesina has been in the country where he agreed
has an external debt amounting to approximate- approval contributing to the national stock debt. to champion the debt resolution and re-engagement
ly US$13.153 billion while international lenders It has a system of bypassing the systems of process and is expected to coordinate and chair the
like IMF and World Bank estimate the external accountability. Constitution clearly states that the forthcoming High-Level Debt Resolution Forum.
debt to be around US$19 billion. This makes parliament should approve any spending by the However, for this to bear fruits, there is a need to
sense if we add the debt owed to foreign farm- government. reform how the government manages the public
ers which I a foreign debt though put in local The graph below shows Stock of Domestic Debt finances and requires a high level of transparency.
debt of US$3.5 billion to either the US$14 end June 2022 (ZWL$ million) (Preliminary One of the ways government looks forward to
billion or US$13.153 billion. figures): Source-Treasury servicing its debts is the Highly Indebtable Poor
Conversely, AFRODAD and ZIMCODD estimat- Countries (HIPC) route which gives Zimbabwe a
ed that the debt has already surpassed both better way of servicing its debts. However, it
US$13 billion and US$19 billion due to the requires the country to establish a sound record of
lack of a formal protocol by the government reforms, not propaganda, not hiring lobbyists. it
when borrowing putting it around US$22 also requires inking of projects that were funded
billion. That has led an independent Economist, by the IMF and World Bank, a major hurdle for
Gerald Macheka to put the debt figure above the country due to mismanagement of funds.
US$25 billion due to these debt discrepancies. Zimbabwe is well known for borrowing funds to
The government is not only accumulating debts fund project A and then channelling them to Proj-
externally but also has huge debts locally. The ect Y and Z.
domestic debt according to official data has
accrued to ZW$1.3 trillion as of June 2021 and “We don’t have a debt problem but a political However, ZIMCODD is of the concern that if vari-
it is not clear if the government haven’t bor- attitude challenge towards how we look at our ous figures are put concerning the Zimbabwe debt,
rowed between that period to June 2022. The expenditure. We have a consumption problem,” how much is Adesina going to ask for? Also, the
huge debt is due to fiscal indiscipline as the AFRODAD said. debt crisis that Zimbabwe is in requires a debt
government continues to bite what it cannot bail-out from multilateral and international lenders
chew as it battles to finance its campaign proj- where the United States and the United Kingdom
ects. Due to a lack of debt transparency, the are actively involved, the nations who are calling
debt might even be around ZW$4 trillion due or political and economic reforms in Zimbabwe.
to some hidden debts which are not disclosed, So, to whom is Adesina going to ask for a bail-
clothed in the name of donations, especially out? This is where the issues to do with transpar
from China. History shows that China doesn’t
offer free cows. *To Page 6

The AXiS XLI Friday 19 Aug 2022 6

*From Page 4 of human rights, corruption and lack of rule of However, statistics on the ground are a different
law, assertions that the Zimbabwean government story. The Afro Barometer Survey of 2020 showed
fency and reforms in line with ZIDERA come disputes. Corruption is cancer that eats away at that corruption increased by 60% between 2018
to play. a citizen’s faith in democracy and diminishes the and 2019, the years in which the second republic
The fact that African Union and SADC are fail- instinct for innovation and economic growth. promised a raft of measures.
ing to rebuke political and social injustices pur-
ported by the Second Republic, issues to do However, despite the government disregarding Law enforcement has been on a ‘catch and release’
with corruption and democracy, will be very any human rights abuses, corruption and lack of circus with fingered corrupt officials- with no gen-
surprising to learn that Adesina has and will rule of law, ZIDERA is backed by tangible uine arrests and imprisonments occurring. In 2019,
rebuke President Mnangagwa for that. Zimba- examples. Since the first elections were held Tourism Minister Prisca Mupfumira was fired after
bwean political atmosphere will make it harder after the formation of the opposition party in she was accused of criminal conduct during her
for Adesina to make a credit bailout for Zimba- Zimbabwe in 1997, elections carried out were time as Minister of Public Service resulting in the
bwe or even achieve a meaningful footprint if bloody with a lot of activists losing their lives loss of US$95 million at the National Social Secu-
not political reforms remain idle. for practising their democratic rights. ZANU PF rity Authority. Zimbabwe’s Health Minister, Obadi-
Official reports from the government and IMF supporters and state machinery (security forces) ah Moyo, was discharged in June 2020 after alle-
indicate that Zimbabwe lost a minimum of have been on record butchering opposition sup- gations that he illegitimately granted a US$60 mil-
US$1.2 billion to corruption. If that is corrected, porters and opening live firm arms to the lion contract to a sinister firm that sold the govern-
Zimbabwe can service its debt within a space of masses. Dictatorship and lack of democracy had ment COVID19 PPE at inflated prices in what is
10 years using the government statistics. This forced the country’s leadership to turn to China known as the ‘DRAX scandal.’
is where ZIDERA and ZIMCODD shake hands. for rescue. Both former ministers walked away scot-free.

“Zimbabwe should invest more in debt audits Regarding rule of law, there are several occa- Relationship between ZIDERA reforms and Debt
and independent debt audits for credibility,” sions where the ZANU-PF-aligned members crisis
ZIMCODD said. have broken the law but were left scot-free. On The relationship with debt settlement comes into
In 2019, China accused Zimbabwe of underesti- the other hand, opposition parties, especially play because the nations that imposed sanctions on
mating loans provided by the Chinese creditors from the Chamisa-led wing have been refused Zimbabwe such as the United Kingdom, EU and
after budget figures released showed that major court bails with the current CCC chairperson USA are very influential in how the International
ally Beijing ranked poorly on the list of Hara- being denied a bail, though it is a right aligned Monetary Fund, World Bank, African Development
re’s foreign donors. Zimbabwe’s authorities have with the highest law of the land. Some members Bank itself, the African Development Fund, the
a history of quietly racking up foreign and local of the opposition wing are intimidated and their European Bank for Reconstruction and Develop-
debt without the approval of parliament and the rallies banned by security officials while ZA- ment the Multilateral Investment Guaranty Agency
funding discrepancy has raised eyebrows that NU-PF members carry out theirs without any and other international lenders conduct their opera-
the Treasury is hiding figures. hindrance. tions. With their influence, it is impossible for
A closer look at ZIDERA and Debt Crisis On the corruption side, billions of US dollars these bodies to organise a financial bailout for
“It is the policy of the United States to support have left the country through illicit trade suffo- Zimbabwe without political and economic reforms.
the people of Zimbabwe in their struggle to cating the veins and arteries of Zimbabwe’s It is against this background that ZIMCODD said
effect peaceful, democratic change, achieve escape routes. This is backed by the ranking of the government is scratching where it is not itch-
broad-based and equitable economic growth, and Zimbabwe by the global anti-corruption coali- ing.
restore the rule of law,” ZIDERA Act reads tion, Transparency International, which continues According to research, Zimbabwe lost over 50 rela-
ZIDERA (Zimbabwe Democracy and Economic to present no difference between the Robert tionships with correspondent banks between 2008
Recovery Act) was first enacted in 2001, after Mugabe government and the current Emmerson and 2017 as they engaged in de-risking as a result
violent land takeovers from the White farmers, Mnangagwa-led government despite President of the sanctions and global noncompliance with
disputed and violent elections as well as the Mnangagwa promising zero tolerance for corrup- anti-money laundering legislation. Therefore, with-
country’s involvement in the DRC war. In sum- tion. out addressing democratic reforms, Zimbabwe is
mary, the law demanded that the Zimbabwe “Corruption remains the major source of some likely to continue being in a debt trap.
Electoral Commission be replaced by a new of the problems we face as a country and its With reforms alone as ZIMCODD, AFRODAD and
commission chosen by all parties in Parliament, retarding impact on national development cannot the West calls for, Zimbabwe can even alone
that the military play no role in election cam- be overemphasized,” Mnangagwa told a joint service its debt crisis without much external inter-
paigns, equal access to State media for all par- sitting of the country’s two houses of parlia- ference as the nation is not starved of resources.
ticipating parties, and that the ZEC releases both ment. However, without reforms, economic growth will
the provisional and the final voters’ rolls ahead “On individual cases of corruption, every case remain a nightmare, so as debt servicing. Zimba-
of the poll. must be investigated and punished under the bwe has a power crisis for example and this means
According to ZIDERA, a cancer that is eating dictates of our laws. There should be no sacred it cannot produce more. Investments in the energy
up Zimbabwe’s economic prowess is the abuse cows. My government will have zero tolerance sector are not an easy task because every surplus
towards corruption and this has already begun.” obtained will be channelled to debt servicing.

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7 The AXiS XLI Friday 19 Aug 2022

Sovereign Wealth Fund

How Zim can adopt a fund to manage gold revenues

the year totalled 16 tonnes, cal evidence.
which is 59% up from the same The Zimbabwe Craton, which makes up more
period last year. At this pace, than half of Zimbabwe's land area, is a base-
gold production for the full year ment of the Archaean age that is dominated
will become an all-time high. locally by granitic rocks that enclose volcano
Year to date, gold has raked in sedimentary pile remains known as greenstone
US$1 billion in receipts, a belts. Gold, basic metals, and industrial minerals
figure which has historically are among the abundant array of mineral
been achieved in a full year. resources found in the greenstone belts.
World-class reserves of the platinum group
C oncerning gold, Zimbabwe is dealing with However, in 2021, full-year metals and chrome ore can be found in Zimba-
several problems, such as plundering and receipts reached US$1.6 billion, bwe's famed Great Dyke, which marks the
the failure to reach its maximum produc- driven by strong bullion prices. upper limit of the Archaean.
tion level because of exploration-related prob- Metals prices are being driven There are numerous opportunities to study many
lems. To prevent leakages and encourage eco- by strong demand in the after- of Zimbabwe's roughly 6,000 tiny gold finds
nomic growth through the selling of gold, the math of COVID-19. Gold, an with the possibility of developing them into big
government must figure out a means to manage asset typically preferred for risk mines. Studies in the Zimbabwe Craton have
gold revenues. This article will examine how aversion has seen prices remain demonstrated that the majority of significant
Zimbabwe might establish a wealth fund to strong due to global uncertain- deposits do not exist in isolation but rather com-
administer its gold profits and promote econom- ties following the invasion of prise tiny mines that may eventually grow into
ic development in the nation. Since Zimbabwe's Ukraine by Russia. However, larger mines if further explored. Well-known
growth was cut down from 5.5% to 4.6%, the gold prices may fail to maintain regions with the potential to contain several mil-
country can reach GDP growth levels of more the current high levels of uncertainty comes off lion-ounce gold deposits include the Termite-Kh-
than 5% if it chooses to join a fund like this and the global economic recovery strengthens. anye trend in Silobela, the Dalny-Lily Fault zone
one. Zimbabwe is expected to achieve 35 tonnes this in the Midlands Greenstone Belt, and the Sur-
Investing in physical and financial assets like year before increasing the tonnage to 60 tonnes prise Fault near Shurugwi and the vicinity of
stocks, bonds, real estate, precious metals, or next year. Motapa Mines, and several other regions in the
alternative investments like hedge funds or To handle income from the extraction of gold Zimbabwe Craton.
private equity funds is what a sovereign wealth in Zimbabwe, the country has to establish a Other areas are overlooked due to them having
fund (SWF), also known as a sovereign invest- sovereign wealth fund. This might be a crucial smaller greenstone belts. These belts however
ment fund or social wealth fund, does. Global step in helping the nation's faltering economy, have good potential for hosting big mines
investment is made by sovereign wealth funds. and the fund would ensure open income man- including Mt. Darwin, Dindi, Wedza, Felixburg,
The majority of SWFs are financed by earnings agement and promote national development. A Makaha and Lower Gwanda.
from the export of raw materials or by central strong regulatory structure is required in con- Importance of a wealth fund
bank foreign exchange reserves. As part of its junction with the establishment of this sovereign To handle income from the extraction of gold in
oversight of a country's financial system, a cen- wealth fund to guarantee that gold income is Zimbabwe, the country has to establish a sover-
tral bank may hold some sovereign wealth utilised transparently. eign wealth fund. This might be a crucial step
funds, which are typical of significant economic It will be crucial to have a sovereign fund to in helping the nation's faltering economy, and
and fiscal significance. Essentially, I mean that build the nation and secure its future, particular- the fund would ensure open income management
whatever revenues the government makes from ly now when the globe is experiencing tremen- and promote national development. A strong reg-
gold should be invested in a fund like the dous uncertainty, high inflation, and spending ulatory structure is required in conjunction with
examples mentioned in the paragraph. cuts that are harming the expansion of the the establishment of this sovereign wealth fund
global economy. The funds would aid the nation to guarantee that gold income is utilised trans-
in protecting itself from "external shocks" and parently.
"revenue unpredictability." Massive gold reserves It will be crucial to have a sovereign fund to
exist in Zimbabwe, where gold always domi- build the nation and secure its future, particular-
nates exports, making it a crucial economic ly now when the globe is experiencing tremen-
pillar. dous uncertainty, high inflation, and spending
cuts that are harming the expansion of the global
Other sovereign wealth funds are just the state's economy. The funds would aid the nation in pro-
savings that are invested by different organiza- tecting itself from "external shocks" and "reve-
tions for capital appreciation but may not play nue unpredictability." Massive gold reserves exist
a substantial role in budgetary management. in Zimbabwe, where gold always dominates
The accumulated funds could be made up of or exports, making it a crucial economic pillar.
originate from foreign currency deposits, gold, Savings funds and stabilization funds are the two
special drawing rights (SDRs), and International different categories of funds. To counter the
Monetary Fund (IMF) reserve positions held by negative effects of the boom-bust cycles on gov-
central banks and monetary authorities, as well Background of Zim Gold ernment spending and the overall economy,
stabilization SWFs are established to lessen the
as other domestic assets like pension invest- Before 1990, Zimbabwe's mineral exploration volatility of governmental revenues. SWFs that
ments, oil funds, and other commercial and technology was thought to be 30 years behind accumulate savings do so for future generations.
financial holdings. These are sovereign nation that of nations with comparable geological con- The Government Pension Fund of Norway is
assets that are frequently held in domestic cur- ditions. Infrequently employed in Zimbabwe one such fund. Although there is conflicting
rency and various reserve currencies (such as were the geophysical, geochemical, and remote research on the topic, it is thought that SWFs in
the dollar, euro, pound, and yen). Such invest- sensing methods that led to the discovery of resource-rich nations can assist prevent the
ment management organizations, state pension mineral reserves in previously unexplored resource curse. Governments may be able to
funds, or sovereign funds, among others, can be regions in other nations. Now that more busi- spend the money right away, but they run the
established. nesses are using these strategies more frequently, risk of overheating the economy. Saving the
money in these situations to spend during a time
Summary of latest gold exports fresh findings are being made. Recently, the of low inflation is frequently preferred. Other
Bubi mine was discovered as a result of geo- justifications for SWF creation could be strategic
chemical anomalies. Ipanema and Hungwe in or economic Investments by sovereign wealth
In June 2022, the country exported semi-manu- the Belingwe Greenstone Belt, a region that was funds that are made in a wide range of business-
factured gold valued at US$152.2 million, signi- previously thought to have modest deposits, are es and assets.
fying a decline from US$165.9 million in May two more noteworthy new finds made through a
2022. Gold produced over the first 6 months of meticulous study of geochemical and geophysi-

The AXiS XLI Friday 19 Aug 2022 8

Beyond artisanal mining
Zim’s struggles between immediate gratification and
long-term sustainable growth

I n 2021, Zimbabwe reached its highest foreign historically anchored Zimbabwe’s export receipts explorations on virgin land since the colonial era
currency earnings ever in its history, at with annual receipts averaging about US$1 billion and there less likely that the measure by govern-
US$10 billion. A disaggregation of these in the dollarization period and an estimated 20% ment is reliable.
earnings showed that exports had grown by 67% to 25% of total export receipts during the respec- However, there is reliable information that Zimba-
to US$6.2 billion, accounting for 64% of total tive period. The bullion remains a key mineral bwe has 6000 known gold deposits and that 60%
receipts for the year. The overall foreign currency export commodity for Zimbabwe and strategic of the country’s land surface contains a Archaean
outturn was phenomenal in that it cemented a resource for catalyzing economic development and age basement known as the Zimbabwe Craton,
positive Balance of Payment position (BOP), growth prospects. which is dominated by granitic rocks locally
which had begun in 2020. A positive BOP posi- Zimbabwe’s has no quantified gold mine reserves, enclosing remnants of volcano sedimentary piles
tion shows that on the net, the country’s outflows at least according to global renowned industry known as greenstone belts. The greenstone belts
of forex were lower than the inflows. A net posi- bodies such as the US Geological Survey, but the are renowned for the rich variety of mineral
tive BOP position should anchor currency stability government of Zimbabwe recently commissioned resources including gold, base metals and indus-
assuming that all other factors of the economy are a report highlighting that the ore body contains trial minerals. The Great Dyke marking the upper
managed well. 13 million tonnes of proven gold. The figure boundary of the Archaean in Zimbabwe, hosts
In 2022, exports are expected to swell to about however comparatively looks unrealistic when world class reserves of platinum group metals and
US$8 billion which is a growth of 29% on the looked at against the existing and producing chrome ore.
2021 record outturn and again a historical record mines capacity as well global peers. For example, One known challenge is that Zimbabwe is consid-
high. The growth in exports could easily push Australia which has the world’s largest reserves’ ered to be a country of small gold deposits
aggregate receipts to levels above US$12 billion, according to the US Geological Survey holds because of the proliferation of sheer quartz veins
for the country. Mineral exports are expected to about 10,000 tonnes. Canada and South Africa at ore bodies which are normally small. This is a
anchor the envisaged growth and among these is number two and three have 5300 tonnes and 2300 deterrent to industrial scale mining investment re
the tradition key driver, which is gold. Gold has tonnes respectively. There have been now new
*To Page 9

*To Page 9

9 The AXiS XLI Friday 19 Aug 2022

Fact or Fiction:

The RBZ’s roadmap towards strategic transformation

T he governor of the Zimbabwean central bank, dialogue regarding the potential benefits and risks It's still early days for CBDC, but is the RBZ
John Mangudya, last week said his organiza- of CBDC”, he said. really on a roadmap to transform the narrative.
tion “has developed a roadmap for adoption According to the RBZ, once the document has For so long the apex bank has been plagued by
of CBDC [central bank digital currency] in Zim- been released, the public will have an opportunity various policy blunders and inconsistencies, and
babwe.”. This is part of the RBZ’s wider strategy to comment on the consultation paper. This must the perceived lack of independence. Creating a
to reboot the economy by deploying yet another, be done within 90 days after the release of the new narrative will take a lot more than a “few”
almost unprecedented monetary policy measure. consultation paper, Mangudya said. Besides the right policy decisions. The scale and magnitude
Just like the gold coins, a central bank digital consultation paper, the RBZ will also “carry-out of damage done to the Zimbabwean economy is
currency is unique policy tool for an already consumer perception surveys on CBDC.” The beyond patchwork. However, if the central bank
unconventional economy. findings from the two undertakings “will enable is to really listen to the market, terms like decen-
We have known about the RBZ’s affinity to the Bank to engage in pilot programmes related tralised finance, cryptocurrency, and CBDC’s, the
broaden its monetary strategy to effectively solve to CBDC.” gold standard and subsequently dollarisation, are
the currency and inflation situation. One of these Meanwhile, in the same statement, the RBZ gov- what the authorities will hear. But are they ready
strategies has been a focus on launching a central ernor revealed that two fintech firms; namely to listen?
bank digital currency. The RBZ’s intention to Llyod Crowd Funding and Uhuru Innovative The Gold Fix
explore the feasibility of launching a central bank Solutions had been admitted into the fintech regu-
digital currency (CBDC) has been pronounced latory sandbox. Of these two, Llyod Crowd Fund- Back in July, the central bank started selling gold
since the beginning of the year. Now the governor ing has already commenced its sandbox opera- coins to get inflation under control by providing
John Mangudya says that the central bank has a tions that will run until 2023 while Uhuru Inno- a store of value to the country's plunging curren-
roadmap for the envisaged digital currency. He vative Solutions is expected to start regulatory cy and giving the population an alternative to the
said the bank’s development of the roadmap is in testing soon. U.S. dollar. One week after kick-off, the country
line with the government’s decision on the CBDC Governor Mangudya also revealed that two saw strong demand, with the country's central
which was made in November 2021. fintech start-ups had been admitted into the cen- bank selling close to 4000 gold coins and mop-
After years of shunning views from various eco- tral bank’s fintech regulatory sandbox. Ultimately, ping up approximately ZWL4 billion in excess
nomic agents and stakeholders, in his second the RBZ says that the admission of the two liquidity.
monetary policy statement of the year the gover- start-ups and “the initiation of regulatory testing
nor says his bank is ready to listen. is a signal of the Bank’s commitment to promot- After turning their sights on scaling up produc-
“The role of stakeholders in the CBDC journey ing responsible innovation.” Moreover, the RBZ tion, large scale miners are now being encouraged
is paramount and, in that regard, the Bank has expects the results that are derived from the regu- by the government to produce more gold. Those
developed a public consultation paper on CBDC latory testing to generate “critical evidence in the who exceed their targets can receive 80% of the
to be released soon. The consultation paper is formation of an appropriate regulatory framework payment for the additional output in foreign cur-
aimed at fostering a broad and transparent public for financial technology in the country.” rency, Bloomberg quoted Deputy Mines Minister
Polite Kambamura as saying. The current pay-
ment plan is a 60-40 split between foreign and

*To Page 10

*From Page 8 The dearth which was experienced up to 2008 half, the total for the year will be marginally
before a recovery kicked in, was also largely due shyof the 35 tonnes target at about 33 tonnes.
which most established foreign miners will be to viability and currency failure. Authorities are This will mark a 13% growth over last year and
looking at. This is also one of the reasons why aware and have tried to counter by offering an all time high for the country. So far of the 16
most of the gold mining is done by artisanal higher payment ratios in USD. Government now tonnes delivered as at June, 66% was delivered
miners. While most gold deposits exhibit closer targets that it will achieve 35 tonnes in 2022 by small scale miners, which means the margin
to surface ore, most of the 6000 known deposits against a preset target of 100 tonnes for 2023, set is widening. Primary scale gold mining has not
were mined since the 1500s and because they earlier in 2019. Government projects that the seen much traction over the years. Most mines
were not fully geologically prospected, there has mining industry will become a US$10 billion remain undercapitalized and struggling to survive.
been less scope for expansion and industrial sector by 2023, with gold contributing 40% to In recent periods mines like Blanket, have attract-
mining at most of the deposits even those that a that total. As each day passes it is proving that ed huge capital investment which has increased
held by relatively bigger corporations. Beyond these targets are too ambitious. Government has mine life. What Zimbabwe needs at the moment
water levels, most mining has stalled because of been reluctant in reforming the gold sector. In to unlock its potential in mining is attracting long
the mining methods deployed the artisans. Gov- fact, most beneficiaries of the informalization term investments into mining which is able to go
ernment policy will need to be recalibrated to ofthe sector are linked to the ruling party with beyond what artisans are doing. Firm gold prices
properly regulate the sector, not only in terms some mafia kind running swaths of gold rich on the global markets have helped significantly
final produce, but the methods of mining and lands known as makomba. improve the forex receipts and this may likely
value created in the process. If this information By half year 2022, gold deliveries had reached remain the same throughout the year, but the pace
is anything to go by, the country cannot sustain 16tonnes and if this is replicated into the second of production, investment and exploration paints a
growth in gold production, if artisans are the gloomier picture.
forefront of production. It is likely that their
methods are less efficient thus costly and
extraction per kilometer way below optimal prof-
itable levels. But because this segment dodges
taxes and sometimes even side markets, it is able
to recover full value from their poorly mined
gold.
Data shows that artisanal mining activities have
been swelling over the last few years. In 2019
and for the first-time, small-scale producesur-
passed that of large-scale miners. However, the
performance of small-scale miners has been vola-
tile on the account of weak regulatory measures
and the opacity of their activities. in 2019 and
2020 production successively fell and this was
largely on the account of a decline in contribution
from artisanal miners. The artisans are so swift in
dealing with currency matters such that any
discrepancy to full value is countered through
side marketing. When the premium between the
auction market and the parallel market is widest,
artisans who prior to received almost half of their
earnings in ZWL, would punish the regulators by
taking their produce elsewhere.

The AXiS XLI Friday 19 Aug 2022 10

*From Page 9 billion revenue, according to Kambamura. The country's annual inflation surged 256.9% in
Why this is important for the gold coins? July from 191.6% the previous month.
local currency payments and 80% is no doubt a The gold coins being minted and sold by the cen- In response to the crisis, Zimbabwe's central bank
much better incentive. Producing exponentially tral bank are one troy ounce 22-carat gold coins was forced to more than double its policy rate
more gold is vital component of the Gold Fix. called 'Mosi-Oa-Tunya.'. Each gold coin has a from 80% to 200%, a new record. Zimbabwe also
serial number and can be purchased with local announced plans to adopt the U.S. dollar as legal
The country's gold miners lose too much foreign currency, the U.S. dollar, and other foreign curren- tender for the next five years to stabilize the
currency earnings that would otherwise sustain cies. country's exchange rate. But there is a severe
their operation costs. Gold exports are currently The price is set based on the international price shortage of dollars. This is the second time in
Zimbabwe’s top foreign currency earner, followed of gold and production costs. The owners of the more than a decade that Zimbabwe has legalized
by platinum and remittances. To help the mining gold coins can convert them into cash or trade the greenback as legal tender. However, it is cru-
industry out, Zimbabwe has selected two local them whenever needed. The gold coins could also cial that the Zim dollar survives if the economy
lenders to provide $1 billion worth of funding be used for transactional purposes and as a secu- is to dollarise. So far, there has been sufficient
over the next five years. rity for loans. The government's plan is to use evidence that the gold coins have been well
these coins to lower the demand for U.S. dollars received by the market, considering how they
Production increases are already being planned by following the collapse of the Zimbabwe dollar. have been selling at a fairly good rate, have man-
some gold miners, including state-owned Kuvim- Surging inflation and currency devaluation have aged to stabilise the parallel market exchange rate
ba Mining House Ltd., which is looking into a made things difficult for Zimbabwe's population. and have created a genuine investment avenue for
fivefold increase in production at its Shamva various stakeholders.
Gold mine by 2023. Zimbabwe's gold output is
already up 47% this year, with the government
looking for gold mining to account for a third of
2023's overall mining industry targeted $12

& Insights

Invictus Energy

Expands exploration footprint in Cabora Bassa
A ustralian Securities Exchange (ASX)-
listed oil and gas firm Invictus Energy an area of approximately 130,000 hectares and drilled in the expanded licence area.
has picked up two more exploration the current SG4571 licence area covering a The Baobab prospect will test one of the multiple
rights in Zimbabwe’s Cabora Bassa Basin, further 100,000 hectares. Basin Margin targets which display similar struc-

expanding its licence footprint in the Southern Commenting on the developments, Invictus Man- tural characteristics to the prolific East Africa Rift
African country. aging Director, Scott Macmillan said “We are play and provided material discoveries in the
extremely pleased to have concluded the Assign- Lokichar Basin in Kenya and Albertine Graben in
Recently this week, Invictus announced that it has ment Agreement with the Sovereign Wealth Fund Uganda.“We are excited to confirm Baobab-1 as
executed an assignment agreement with the Sov- of Zimbabwe to expand our exploration footprint the second well to be drilled in our basin opening
ereign Wealth Fund of Zimbabwe (“SWFZ”) for in the Cabora Bassa Basin.” exploration program, which will target the newly
the exploration rights to Exclusive Prospecting identified basin margin play, displaying similar
Orders (EPOs) 1848 and 1849. Macmillan added, “The combined Exploration characteristics to the prolific East Africa Rift
Licences provide us with a basin master position “String of Pearls” play,” Macmillan said adding
“EPOs 1848 and 1849 are contiguous to the encompassing the entire conventional oil and gas that, “Subject to making an opening discovery
Company’s current SG 4571 licence (together “the play fairway and running room in the basin. with either Mukuyu-1 or Baobab-1, it could
Exploration Licences”), with the newly combined potentially provide us with future discoveries on
area covering the entire conventional oil and gas The Exploration Licences are focused on the core a large scale within the basin.”
play fairway in the Cabora Bassa Basin,” Invictus prospective area in the basin, which is covered by
said. our CB21 Seismic Survey and minimises our Meanwhile, Invictus is set to commence drilling
holding costs through the relinquishment of at its Mukuyu-1 well later this month with recent
The Assignment follows a gazettal of the EPOs non-prospective areas in the basin.” reports that the Company has already started
and Heads of Agreement with the SWFZ, as assembling drilling equipment at the exploration
detailed in the ASX release on 28 March 2022, Invictus further highlighted that following the site.
where the Parties agreed to collaborate in explora- execution of the Assignment, it has selected the
tion for oil and gas within RA MSC003 Cabora Baobab prospect as the commitment well to be In its latest report, re-owned UK-based global
Bassa South. energy think tank, the Westwood Global Energy
Group, the oil well has been classified as one of
It confers all exploration rights and obligations the ‘key wells’ as it has the potential to help
for EPOs 1848 and 1849 from SWFZ to Geo Africa return to high impact exploration status
Associates and conversion to a Special Grant this year.
upon application following a commercial discov-
ery and the SWFZ will be entitled to a 10 per According to Westwood, the Mukyu-1 well is
cent back-in right within six months of an among the 90 high-impact oil wells expected to
announcement of Final Investment Decision to have been drilled across the globe by year-end.
develop any commercial discovery.
“Africa will see a return to high impact explora-
According to Invictus, the Exploration Licences tion in 2022, with key wells planned in South
cover a combined area of approximately Africa, Mozambique and Zimbabwe following the
360,000hectares, with EPOs 1848 and 1849 each successes in Namibia earlier in the year,” West-
covering wood said.

Did you know? CAFCA was established in 1947 and is listed under the Zimababwe Stock Exchange,
Johannesburg and London Stock Exchanges. The Company is part of CBi Electric Afri-
can Cables, which is owned by Reunert Limited.

11 The AXiS XLI Friday 19 Aug 2022

The “Rolex way”
Lessons for Non Profit organisations

L ooking at the graph above, it is clear that public's trust in it. Nonprofit organizations rely Hans Wilsdorf established the Foundation shortly
Rolex consistently generates top-tier reve- on donations to fund their operations. It is said after his wife passed away in 1944, in fact. Rolex
nues for non-profit organizations. It is cru- that the more a nonprofit organization focuses on was his main business, and he donated all of his
cial that many non-profits use Rolex as a model its objective, the more trust the public has in it. shares to the Foundation. Control of the Founda-
for how to perform at this level, regardless of the The organization will make more money as a tion fell to the five Foundation trustees after his
legal entity's structure. result of this. The activities a nonprofit engages death in 1960. These people are neither owners
This article will examine Rolex's organizational in, along with how ethical the rules and practices nor shareholders. They only serve as stewards.
structure and suggest ways that other businesses are, can aid in increasing public confidence in Their primary mission is to maintain Rolex S.A.
can adopt it. The majority of other watch brands organizations. while also managing the previously mentioned
are not like Rolex. In actuality, Rolex operates in Actually, Rolex is a group of businesses led by unspecified amount of humanitarian endeavors.
a totally different manner. Non-profit is Rolex S.A. And to make matters even more com- The Rolex Awards for Enterprise, which honors
undoubtedly not the first thing that comes to plicated, some of those businesses have ownership trailblazing men and women from all around the
mind when thinking of massive luxury com- stakes in one another. But in essence, they all go world who work to enhance life on Earth, The
panies like Rolex. But the truth is that through Rolex S.A., which is owned entirely by Rolex Institute, and The Rolex Mentor and
Rolex is a non-profit organization. the Hans Wilsdorf Foundation. Since the Swiss Protégé Arts Initiative are some of these philan-
The Wilsdorf Foundation owns Rolex government recognizes that foundation as a chari- thropic organizations (which supports a number of
S.A., the manufacturer of Rolex watches. ty trust, it is exempt from paying taxes. extremely talented young artists).
Rolex was founded in 1945 by Hans Aside from regional legal variations, profit-mak- Inside the Company
Wilsdorf, who also started the founda- ing non-profit organizations exist. Salaries are It is not just one of the most well-known names
tion. To honor his late wife Florence paid from Rolex's earnings, which are said to be in luxury but also a historically significant watch
Frances May Wilsdorf-Crotty, who well north of $4 billion. Operating expenditures manufacturer, a success story of contemporary
passed away in 1944, the founda- and manufacturing costs are also covered. The industrialisation, a social (and possibly actual)
tion was created. majority of the remaining money either goes back
In contrast to an entity that into the business or to an undetermined number currency, and a vertically integrated empire
operates as a business with the of charity. After that, what is left is put in the that closely guards its secrets. Geneva is
goal of making a profit for its bank. Due to their legal standing, neither Rolex home to three Rolex production facili-
owners, a nonprofit organiza- S.A. nor the Wilsdorf Foundation are required to ties, where workers make everything
tion (NPO), also referred to as make their financial information public. from watch casings to finished
a non-business entity, A look at the Rolex Corporate Structure goods. However, Rolex watch
not-for-profit organization, or movements are created (as they
nonprofit institution, is a legal have always been) roughly two
entity organized and run for a hours away in the city of Bienne,
collective, public, or social which is located on the boundary
benefit. The non-distribution of the German and French spoken
constraint applies to nonprofits, regions of the nation.
which means that any surplus Their goal is to produce the best
funds must be used to further mechanical watches they can, and
their mission rather than being they will stop at nothing to
distributed to other parties. Many achieve this goal. In fact, despite
organizations, including some politi- widespread contention that the
cal ones, educational institutions, pro- world no longer requires mechanical
fessional associations, religious institu- timepieces, their company has gotten
tions, social clubs, and consumer cooper- so good at producing watches that they
atives, are nonprofit. Government approv- continue to do so. Rolex has continued to
al is required for nonprofit organizations
to be tax-exempt, however some may also vertically integrate itself more and more over
be eligible for tax-deductible donations. time. i.e., they manufacture the majority of the
However, an organization can incorporate as components for their watches in-house. The
a nonprofit organization even if it does not majority of their products and services, including
have tax-exempt status. their sapphire crystals and watch hands, are cur-
According to Forbes, Rolex is among the top rently provided by outside vendors. If they finally
100 high-quality brands in the world. It is brought that job in-house as well, it wouldn't
important to examine what has helped this surprise me.
non-profit stand out from the competition and Rolex remains independent and driven by itself,
what other non-profit organizations may learn continuing its aim to produce the best watches
from Rolex. while in space. Instead, despite the prevalence of
Accountability, trustworthiness, honesty, and trans- smartphones and fiber-optic internet, many people
parency to everyone who has put their time, in the established business sector still feel incom-
money, and faith into the organization are import- plete without a fine mechanical watch. It wouldn't
ant characteristics of nonprofits. Accountability be ridiculous to give Rolex a lot of the credit for
for nonprofit organizations rests with donors, it.
founders, volunteers, program participants, and the The availability of low-cost, precise electronic
general public. The ability of a nonprofit organi- quartz movements produced in Asia in the 1980s
zation to obtain funds depends, in theory, on the severely hampered the Swiss mechanical watch
business. Even Rolex briefly entered the quartz
watch manufacturing business. They soon halted,
though, and chose to refocus solely on mechanical
timepieces. But it was the Swatch Group, with its
(ironically) low-cost and precise quartz-based
Swatch product, that was credited with salvaging
the Swiss watch industry.
As a result, while quartz helped save Switzerland
from quartz, the money made in the 1990s and
beyond helped revitalize the mechanical wrist
watch business. Having said that, more watch
manufacturers can only compete in the biggest
markets by investing heavily in marketing, with
Rolex serving as possibly the best example. Rolex
launched a significant awareness effort in the
1980s to gently include the Rolex name in every

*To Page 12

The AXiS XLI Friday 19 Aug 2022 12

*From Page 11 purchase a Rolex (typically for themselves) way out because so few young people wear it.
tomark important life events like graduating from True, there is a lot more technology competing
thing associated with time and achievement. school or landing a dream job or promotion. for people's discretionary income today than there
Today, if you visit any airport worth visiting, you Rolex relies on two factors. First, that people will was decades ago. Additionally, it indicates that a
can be sure that you'll see a lot of timepieces always be curious about the time, and second, tablet computer or phone are more likely to be
bearing the Rolex name. Popular sporting and that the wrist will continue to be a popular loca- given as a present to a teenager than a watch.
cultural events are no different. tion for displaying jewelry. People frequently only However, as technology develops, the wrist is
allow items that even slightly resemble jewelry to once more proving to be a very desirable place
Rolex realized early on that in order to remain be worn on their wrists.The media has excessive- to wear objects, and watches are staging a come-
successful, it needed to create more than just a ly overstated the wrist watch's demise. It is back.
wonderful product; it also needed to create a frequently argued that the wrist watch is on its
terrific experience that went along with wearing
it. Success today is equated with Rolex. People

Government
The chief architect of prevailing macroeconomic volatility

By Zvikomborero Sibanda probable factors indicate that more than 40% of A part of his column reads, “Many things have
a litre since were government fuel levies and been going wrong in the (public) sector, which
Z imbabwe is struggling with severe macro- charges. must show the way and whose buying powerac-
economic volatility since 2019 when As for the deepening gratuitous rent-seeking counts for 70% of the demand for goods and
authorities reintroduced the Zimbabwe behaviour, this piece subscribes to the doctrine of services in our economy.
dollar (ZWL). The local currency was disbanded homo economicus economic agents, that is, eco- The public sector has been largely guilty of sins
after the record hyperinflation period of 2007/8 nomic agents behave in exact accordance with of omission. We have not always been a prudent
led to a complete rejection of ZWL transactions their rational self-interests of always attempting to procurer, a weakness which has levied very
in the market. For the past four (4) years, the maximize utility (consumers) and profit (business- costly consequences to the whole economy.”
monetary authority had tried various exchange es). With this in mind, it is difficult for a pro- It is welcoming to note that authorities have
rate regimes to save an embattled currency. These gressive economic observer to dispute the notion now realized that they are contributing a large
regimes include a fixed exchange rate regime that by concurrently pumping money supply in part to the current problems. Last month the
which is highly unsustainable for a country like the market unsustainably and selling foreign cur- government started to pay its contractors 50% in
Zimbabwe faced with perennial foreign currency rency in short supply at an overvalued official forex and 50% in local currency paid in instal-
shortages in official markets. exchange rate, the RBZ had created a fertile ments over many months. Recently, authorities
further tightened their grip by barring procuring
In June 2020, a Dutch Foreign Currency Auction ground for arbitrage and speculative activities entities from processing all payments for goods
System was introduced. Despite numerous warn- which needs one to have no understanding of and services awaiting submission of reports of
ings from independent economists against frequent economic principles to identify the grave effects findings of the due diligence exercise on all
Reserve Bank of Zimbabwe (RBZ) interference in of these activities on the stability of the local cur- running and future contracts with a special focus
this forex market, the system failed big as parallel rency. on pricing.
To accelerate the mopping up of excess liquidity
market exchange premia kept burgeoning, forcing In a nutshell, elevated exchange rate volatility and improve confidence by providing investors
authorities to ditch the system in June 2022. The being experienced in the parallel markets validates with lucrative alternative stores of value, RBZ
nation now follows a Willing-Buyer Willing-Sell- the efficient market hypothesis as markets will be is releasing gold coins per week into the
er (WBWS) interbank market to discover the true decoding new market information, particularly on market.
value of the ZWL against the currencies of other the quantum of money in circulation. As such, This could be a game changer if the official rate
nations. Again, most metrics show that there is parallel market exchange premia stabilize only is reconfigured to fully reflect market dynamics.
enormous upward pressure on parallel market when fiscal discipline, strengthening of institutions At the present, the overvaluation of the ZWL in
exchange rates in the market. Without addressing & legal framework, and policymakers’ unwavering official markets is tantamount to selling scarce
disturbing issues like excessive rampant corrup- commitment to a steady, sustainable supply of yellow metal at a discount. This creates a huge
tion in the public sector and unsustainable growth ZWL liquidity become part of the policy mix. disequilibrium that reverses expected the desired
of ZWL liquidity in the market, the stability that outcomes of using gold as both a medium of
might occur in the future will be mostly by exchange and storing value.
chance and largely temporary. A good case in From the fiscal front, the Treasury had embarked From the foregoing analysis, this piece con-
point is the stability that was enjoyed soon after on substantial infrastructure projects like roads cludes that for effective monetary and fiscal
the introduction of the forex auction system two and dam construction. After decades of inactivity policy implementation, there is a need for ade-
(2) years ago. in the development of infrastructure in Zimbabwe, quate political will to reign in rampant corrup-
it is commendable that authorities have embarked tion in public procurement and tendering pro-
on various projects to expand as well as resusci- cesses. The perpetual violation of the Public
Granular analysis of the push factors of the cur- tate dilapidating infrastructure. However, these Procurement and Disposal of Public Assets Act
rent currency and price madness shows that the projects are largely funded by short-term finance and display of impunity is fortifying fiscal indis-
instability is being triggered mainly by the rushed (direct injection of cash) against the conventional cipline by line ministries as shown by the latest
implementation of poorly thought economic poli- norm of using long-term sources of finance to Treasury request for ZWL107 billion condona-
cies. Through its actions, the government has fund long-term projects. By using cash and other tion for the 2019-2020 fiscal years after another
become the key architect of the crisis. Distancing near-money assets, the government has increased unexplained budget overruns incurred between
themselves away from their incompetence, the idle ZWL bank balances which ended up chan- 2015 and 2018.
Russia-Ukraine war has become the scapegoat for nelled black markets in search of a stable green- Also, without the political will to clamp corrup-
public officials. Also, authorities are pointing at back. tion, the Value for Money Unit (VMU) which
human (rent-seeking) behaviours the key market had been set up at the Treasury will likely
destabilizer. become a toothless bulldog that only exacerbates
Also, the rich and connected are taking advantage the status quo by creating a fecund ground for
of existing porous procurement systems by bribery and tenderpreneurship.
However, if one is to check closely, it is vivid charging the government at high forward parallel As alluded to earlier, the independence of the
that the local currency and general prices were market rates. Ironically, the authorities are paying monetary authority should also be increased to
under immense pressure well before the start of these contractors at or above the parallel market ensure that a truly market-driven ZWL price
the Russian invasion of sovereign Ukraine. For rates yet forcing other economic agents to bench- discovery process is followed with limited inter-
instance, as of the end of December 2021 mark their ZWL prices at the official rates. Cur- ference by the “visible hand.” This is crucial
(pre-war period), the broad money supply mount- rently, the government accounts for about 70% of because political interference in exchange rate
ed by 113% on year-on-year terms forcing the transactions in the economy. As such, it is clear management generally results in an overvalued
ZWL to scale down by an average of 48% in that the government Ministries, Departments, and official exchange rate which promotes excess
parallel markets. Resultantly, price inflation closed Agencies (MDAs) are the chief drivers of ZWL rent-seeking and causes growth-retarding pricing
2021 at 60.74% which was almost double the exchange rate depreciation through a lack of due distortions in the market.
monetary authority’s closing target of between diligence in awarding tenders when procuring in Zvikomborero Sibanda is an Economic Analyst
25-35%. Before the global gas and crude oil the market. for Zimbabwe Coalition on Debt and Develop-
prices began to overshoot their multi-year highs ment (ZIM- CODD). He writes in his capacity,
driven by increased uncertainty around global his views do not represent those of the organiza-
commodity supply as the West piled massive eco- After years of Treasury beating around the bush tion he works for. Email: bravosibanda@g-
nomic sanctions on Russia, an elite global pro- when explaining the drivers of ZWL decline, the mail.com. Twitter handle @bravon96
ducer of oil and gas, domestic fuel prices were Secretary for Finance and Economic Development
significantly above the regional average thus on a live television broadcast in Victoria Falls
deemed the most expensive. openly accused government MDAs of fuelling the
black-market rates. “The unfortunate thing, Your
Excellency, is that some of the pricing models are
Also, even though other regional countries which supported by procurement and also by line minis-
are net importers of petroleum products like Zim- tries. This is not acceptable and it has to stop
babwe were equally exposed to the negative Your Excellency,” he said. To add more weight,
impacts of the conflict in Ukraine, domestic fuel the President publicly admitted in the Sunday
pump prices emerged as the top most unafford- Mail last week that the public sector is playing a
able prices in the entire region. Examining all the huge part in driving currency and price instability.

13 The AXiS XLI Friday 19 Aug 2022

Meikles kick-start 2022 fiscal year bullish:

As Q1 revenue more than quadruples

A s the battle for currency and economic record 200% also affected productive business “Exchange gains on the Group’s US$ 19 million
stability continues hitting above the roof, sectors as borrowing became expensive. cash balance from the disposal of the investment
the Zimbabwe Stock Exchange-listed in Mentor was ZWL 6.7 billion and is included
diversified group, Meikles Zimbabwe has It is against this background that Meikles Limited in other comprehensive income.”As a result, all
shrugged off headwinds to close its first quarter Zimbabwe fared well on revenue, profit and sales operating subsidiaries generated Regarding sales
for the full year ending 2023 on the appositive volumes with room occupancy advancing by more volume performance, sales for the supermarket
note, recording growth across all units. than four folds. Revenue for the group grew by grew by 39% for the period compared to the
more than four folds from a 21% uptick in the same period in the previous financial year while
Meikles Limited is primarily invested in agricul- first quarter of 2021 to rise by a significant 88% stock levels in the stores remained adequate
ture, hotels and the retail sector. It operates six in inflation-adjusted terms. This led to profit despite disruptions in the supply chain arising
business segments namely hospitality, the retail before tax almost doubling after increasing by from both international and local factors. The
business which includes department stores, whole- 79% ahead of the prior year. However, despite a Russia Ukraine war and South Africa’s rising
salers and supermarkets, agricultural financial solid effort from the group to match up the cards, inflation affected the supply of wheat, cooking oil
services and security. Its well-known brands it should be noted that the period under review and fuel in the country, raw materials that are key
include the Victoria Falls Hotel, Holiday Inn gained more from relaxed COVID-19 restrictions. to the growth of the sector. From within, the
Hotel and Meikles supermarkets. Group suffered from rapid depreciation of the
The pie chart below shows the Group’s key high- local currency which affected operating costs.
The period between April 20222 to June 2022 lights for the quarter ended 30 June 2022
(first quarter ended 30 June 2022) was defined by Meanwhile, room occupancy for the hospitality
a record rise in both month-on-month and segment increased from 11% to 35%, a growth of
year-on-year inflation, record local currency 24 percentage points in comparison to the same
depreciation against the United States dollar and period in the previous year. “The segment is ben-
retrogressive monetary measures by the Treasury efiting from the continued easing of both local
and RBZ that saw the banning of lending and and international COVID-19 restrictions,” the
record interest rates hike. The implication of these Group said.
was on the customer’s purchasing power as the
local currency which most of the people depreci- The average room rate and revenue per available
ated rapidly. room grew by 36% and 327% in US$ terms
respectively while the mix for the period was
In May alone, the local currency depreciated by 90% foreign and 10% local. The Group is opti-
a record 33% since the introduction of the auction “The growth in profit before tax was 791% in mistic about its prospects going forward despite
market on 23 June 2020. Meanwhile, over theth- historical cost terms, boosted by exchange gains the evolving challenges in the operating environ-
ree months, the currency depreciated by a record realised on US$ denominated cash balances held ment. According to the Group, both expansion
61% wearing away the purchasing power of the by the Group’s subsidiaries,” the Group said in a and replacement capital expenditure plans contin-
local currency. The increase of interest rates to a trading update. ue to be implemented.

Term of The Week

'

Economic moat

Definition: The term "economic moat," refers to a business's ability to advantages can maintain a very large market share of their industry by
s•quSeizeezinadgvoaunttaagney:nBeewincgombigpectaitnorssowmheotimtryest,oimn oitvseelifn, .create an economic
maintain competitive advantages over its competitors in order to protect its moat for a company. At a certain size, a firm achieves economies of scale.
long-term profits and market share. This is when more units of a good or service can be produced on a larger
scale with lower input costs. This reduces overhead costs in areas such as
Understanding economic moat: Economic moats are generally •finHaingchinsgw,iatcdhvienrgti:sBinegin, gprtohdeubcitgiofinsh. in the pond has other advantages. When
a company is able to establish itself in an industry, suppliers and customers
difficult to pinpoint at the time they are being created. Their effects are can be subject to high switching costs should they choose to do business
much more easily observed in hindsight once a company has risen to great with a new competitor. Competitors have a very difficult time taking market
heights. share away from the industry leader because of these cumbersome switch-
One of the basic tenets of modern economics, however, is that, given time, i•ngIncotasntsg.ibles: Another type of economic moat can be created through a
competition will erode any competitive advantages enjoyed by a firm. firm's intangible assets, which include items such as patents, brand recogni-
This effect occurs because once a firm establishes competitive advantages, tion, government licenses, and others. Strong brand name recognition
its superior operations generate boosted profits for itself, thus providing a allows these types of companies to charge a premium for their products
strong incentive for competing firms to duplicate the methods of the leading o•veSrofottmheoractos:mSpoefttitmoorsa'tgsomodays,bwehcicrehabtoedosbtsy perxocfietpst.ional management or a
mfiremthoordfisn. d even better operating unique corporate culture. While difficult to describe, a unique leadership
and corporate environment may partially contribute to a corporation's
nCyrecraetaintegs aanneeccoonnomomic micomatoaantd: There are several ways in which a compa- prolonged economic success.
these include;
• Cost advantage: A cost advantage that competitors cannot replicate can be
a very effective economic moat. Companies with sustainable cost

14 The AXiS XLI Friday 19 Aug 2022

OK Zimbabwe
Calls for a market-determined foreign exchange pricing system

Zimbabwe Stock Exchange-listed giant retailer, OK gathered momentum at the end of the last the Group’s plans for the current year.
Zimbabwe has called for the introduction of a financial year have persisted, with Meanwhile, the Group re-opened the Bon
foreign exchange pricing system that is market-de- month-on-month inflation for June 2022 Marché Mt Pleasant store in July 2022 with
termined and stable in light of the prevailing infla- increasing sharply to 30.7% from 21% in May refreshed and upgraded facilities in line with its
tion headwinds and 2exchange rate disparities 2022 while year-on-year inflation for June 2022 refurbishment program.
which are affecting business operations. was reported at 191.6%, a significant increase “The business will upgrade more stores and also
In a trading update for the quarter ended 30 June from 72.7% reported at the end of the last implement strategies to increase the footprint and
2022, OK Zimbabwe said the willing buyer willing financial year. grow market share during the year,” OK Zimba-
seller interbank market exchange rate against which OK Zimbabwe noted that interest rates were bwe said.
formal businesses are required to benchmark pric- increased to 200% with effect from 1 July The Group noted that despite market-wide
ing is not as attractive as the rates offered in alter- 2022, including on debt arrangements entered liquidity challenges, the business remains on
native unregulated markets and this continues to into before that date and this has made borrow- sound footing and has in place measures to
impact the competitiveness of our USD prices, ing costs excessive resulting in liquidity pres- cover not only all working capital needs but also
impacting foreign currency collections. sures across the entire supply chain. planned capital expenditure in line with its
G.R.O.W.T.H strategy.
“Inflation headwinds are expected to dominate the During the quarter under review, OK Zimba- “Our stores are reasonably stocked, although we
trading environment in the short term. The market bwe’s sales volumes grew by 1% against the continue to experience temporary supply gaps on
desperately needs a foreign exchange pricing prior year whilst inflation-adjusted sales values some key volume drivers,” OK Zimbabwe said.
system that is market-determined and stable,” the increased by 40%.
Group said.

The Group highlighted that profit margins are
According to the Group, inflationary pressures that consistent with the prior year and in line with

Cafca
Cables firm chronicles an 8.2% increase in export volumes

ZSE-listed cable maker Cafca says firm exports Malawi, a key market where foreign currency ra said. “Aluminium conductor sales were down
into Mozambique and Rwanda helped the company shortages have resulted in hand hot demand. mainly due to the impact of awaiting regulatory
lift volumes to foreign markets by 8,2% during the “Our customers in Malawi continue to experi- approval for the barter deal with ZETDC (Zim-
third quarter ended June 30 2022. The performance ence difficulty in obtaining foreign currency so babwe Electricity Transmission and Distribution
comes against the backdrop of calls by the govern- sales there are slightly constrained. Rwanda and Company).
ment for local companies to tap into foreign mar- Mozambique contributed to a growth in “Cafaca has three months sales cover in finished
kets in order to yield real economic growth. year-on-year sales,” she said. goods stock giving us the ability to meet the +/-
In the aggregate, the firm’s domestic and foreign Kangara said export volumes for the review 1 400 stock lines the market requires in relation
conductor volumes rose to 676 tonnes during the period rose to 92 tonnes, an 8% rise from 85 to our weekly production target of 16-line items.
review period, from 625 tonnes during the same tonnes during the same period last year. “We believe that the next three months’ volume
period in 2021, Cafca said in a trading update filed “Export volumes were 92 tonnes in the current will be higher than the current quarter’s volume
with the ZSE. According to company secretary quarter versus 85 tonnes in the same quarter which should result in the company achieving
Caroline Kangara, Historical year-to-date turnover last year,” she said. year-on-year growth in volume sales,” she added.
and profit against the same period last year “Local volumes for the quarter were 8% up on Kangara also added that said interest rate hikes
increased by 197 % and 251 %, respectively. the same quarter last year with the growth by the central bank to 200%, from 80% previ-
Despite the strides made by the company on the mainly in mines and factory cash sales,” Kanga ously, would have a bearing on profitability.
export front, the firm continued to face hurdles in

20Check page

Politics Around The World The AXiS XLI Friday 19 Aug 2022 15

Kenya's Odinga rejects presidentiall poll results, country and remove political pressure on civil The 96% yes vote in the referendum, with 31% of
heads to Supreme Court servants. – Deutsche Welle the electorate taking part, was largely unchanged
Kenyan opposition figure Raila Odinga said Tues- Taiwan's air force flexes muscles in face of Chi- from the preliminary results announced last month.
day the presidential election results declared by nese war games Opponents of President Kais Saied say the new
the country's electoral chairman were "null and Taiwanese F-16 fighters roared into the night sky constitution will unravel Tunisia's democratic gains
void." on Wednesday in a show of force in front of the from the 2011 revolution by giving him nearly
Speaking one day after Deputy President William media, demonstrating the military's determination unchecked powers.
Ruto was declared the winner, Odinga told a to defend the democratically governed island in They have criticised the process by which he wrote
crowd in Nairobi: "What we saw yesterday was a the face of days of Chinese war games. the constitution as illegal and unilateral and have
travesty and a blatant disregard for the constitu- China, which claims Taiwan as its territory, has raised concerns over the legitimacy of the referen-
tion and the laws of Kenya by (Wafula) Chebukati been carrying out military exercises around the dum after he replaced the board of the electoral
the minority of IEBC commissioners". island after a visit earlier this month by U.S. commission. – Reuters
This was Odinga's first appearance since Kenya’s House of Representatives Speaker Nancy Pelosi, Jihadists spread from the Sahel to coastal West
electoral commission chairman on Monday who was followed by five U.S. lawmakers on Africa
declared Ruto the winner with almost 50.5% of Sunday and Monday. Their campaign began in northern Mali a decade
the votes. Pelosi's visit infuriated China, which responded ago, advanced into the country's powder-keg centre
Four of the seven commissioners abruptly with test launches of ballistic missiles over Taipei and from there into neighbouring Niger and Burki-
announced they couldn’t support the results, and for the first time, and sending warships and fight- na Faso.
Odinga supporters scuffled with the remaining er jets close to Taiwan, though the scale of the Now, fears are growing that the ruthless jihadists
commissioners at the declaration venue. – Afri- activities has now greatly reduced. – Reuters wreaking havoc in the Sahel are heading towards
canews US airstrike in Somalia kills 13 al-Shabaab mili- coastal West Africa.
Mali accuses France of arming Islamist fighters in tants, Pentagon says Following multiple incursions including deadly
letter to U.N Defense officials on Wednesday claimed a U.S. attacks in the northern regions of Benin, Ivory
Mali says France has violated its airspace and airstrike against al-Shabaab fighters in Somalia Coast and Togo, governments in the Gulf of
delivered arms to Islamist militants in an attempt killed 13 militants, the deadliest such strike Guinea are reviewing their strategy.
to destabilise the West African country, the latest against the extremist group in months. Their chief concerns, say analysts: how to avoid
in a barrage of accusations that have marked the The airstrike targeted the al Qaeda-linked fighters replicating the mistakes of their neighbours in the
bitter end to their once close relations. on Sunday in a remote location near Teedaan, in Sahel, and how best to muster foreign support. –
In a letter to the head of the United Nations Secu- Somalia’s central region, as the militants were AFP
rity Council dated Monday, Mali's foreign affairs “actively attacking Somali National Army forces,” 'Nowhere to hide' if war comes to Taiwan's
minister, Abdoulaye Diop, said its airspace has according to a statement from U.S. Africa Com- front-line islands
been breached more than 50 times this year, mand (Africom). On Taiwan's windswept Matsu islands, close to
mostly by French forces using drones, military The command’s initial assessment found that no China's coast, one topic has been driving conversa-
helicopters and fighter jets. civilians were injured or killed as part of the tions in recent days: prospects of an invasion by
"These flagrant violations of Malian airspace were strikes, the statement claimed. China since it began military exercises in response
used by France to collect information for terrorist This is the second U.S. military strike in Somalia to visits to Taiwan by U.S. lawmakers.
groups operating in the Sahel and to drop arms within a week. Africom on Aug. 9 conducted Held by Taiwan since the defeated Republic of
and ammunition to them," the letter said. – Reu- three airstrikes outside Beledweyne also in sup- China government fled to Taipei in 1949 after
ters port of the Somali National Army that killed four losing a Chinese civil war, the archipelago of small
Eastern Congo attacks kill civilians, hit major al-Shabaab terrorists. – The Hill islands, less than 10 km (6.2 miles) from China's
power plant William Ruto vows return of 'democratic' Kenya coast at the closest point, would probably be an
Suspected rebels have killed civilians and dam- Two days after the Kenyan electoral commission early target for Beijing in the event of conflict.
aged a major hydropower plant under construction declared William Ruto winner of the presidential China, which claims Taiwan as its territory, has
in Virunga National Park in eastern Democratic race, Kenyans wait for a resolution of the elector- carried out extensive military exercises this month
Republic of Congo, the park operator said on al dispute. after a visit by U.S. House of Representatives
Wednesday. Ruto garnered 50.49% of votes. However, his Speaker Nancy Pelosi, who was followed by five
Tuesday's attack, which included the use of artil- main rival Odinga rejected the results. U.S. lawmakers on Sunday and Monday. – Reuters
lery, came from the direction of positions held by Addressing members of his coalition in Nairobi, Former Australia PM says secret powers were
the M23 rebel group, the park service said in a Wednesday, William Ruto commended his sup- needed in crisis
statement. porters as he credited them with providing him a Scott Morrison said Wednesday that giving himself
M23, which could not be reached for comment, mandate broader than Kenya's previous election: extra powers when he was Australia’s prime minis-
has launched a series of raids in the region in "In 2017, we had 25% in 34 counties, this year, ter was necessary during the coronavirus crisis, as
recent months, killing dozens and displacing tens we have won 25% in 39 counties; that broader criticism rose the moves were deceptive and
of thousands of people. mandate comes with greater responsibility to undemocratic.
It is just one of many armed groups fighting in every Kenyan. There will be no room for exclu- Current Prime Minister Anthony Albanese is seek-
eastern Congo over minerals and land. On Tues- sion of any part of the Republic of Kenya". – ing an opinion from the solicitor-general on the
day, suspected militants from the CODECO group Africanews legality of some of Morrison’s moves.
attacked a mining site a few hundred kilometres Taiwan shows off most advanced fighter jet after Many of Morrison’s own colleagues were blindsided
north of Virunga in Ituri province, killing about China drills by his decision to secretly appoint himself to five
10 civilians and four soldiers, the army told Reu- Taiwan displayed on Wednesday its most ministerial roles, which have only been revealed in
ters. – Reuters advanced fighter jet, the missile-equipped F-16V, recent days. Some have called for him to resign
Kenya: Ruto will 'engage' any challenge to his in a rare nighttime demonstration in the wake of from Parliament, where he is now an opposition
election victory China's unprecedented military drills around the lawmaker after losing the general election to Alba-
President-elect William Ruto promised he would island. nese earlier this year.
not give in to "blackmail" after his rival Raila Beijing staged days of air and sea drills in the But Morrison told reporters in Sydney that while
Odinga pledged to contest the disputed election. Taiwan Strait this month after visits by US House he apologized for causing offense to his colleagues,
Ruto also promised to reduce ethnic tensions in Speaker Nancy Pelosi and a congressional delega- he stood by his actions. – Associated Press
the country.Kenya's president-elect William Ruto tion to the self-ruled island territory. UK ministers were warned of Rwanda political
said on Wednesday that he would "engage" with Taipei has carried out its own drills to simulate killings before approving flight to deport
any court challenges to his victory, a day after his defence against invasion by China and on asylum-seekers
defeated rival Raila Odinga vowed to pursue "all Wednesday air force personnel loaded an F-16V Ministers attempting to send asylum seekers to
legal options" to do so. fighter with a US-made anti-ship missile in a Rwanda were warned by a Foreign Office official
At a press conference, Ruto said that his adminis- "combat readiness" exercise at an airbase in east- that the government in Kigali used “abitrary deten-
tration "will have nothing to do with that black- ern Hualien County. – AFP tion, torture and even killings” to stifle political
mail we have seen, the threats we have seen, the Tunisia constitution giving president wider opposition, the High Court has been told.
fear sown around the country." powers comes into effect Priti Patel’s Home Office is currently embroiled in
His remarks alluded to the post-election violence Tunisia's new constitution giving the president far a legal row over whether its asylum policy is
that has often plagued Kenya following disputed greater powers is to come into effect after the lawful and ahead of a court battle next month
elections. official electoral commission announced final foreign secretary Liz Truss has sought this week to
During the press conference, Ruto said he also results on Tuesday for last month's referendum. keep certain documents relating to the government’s
would work to reduce ethnic tensions in the cou- plans a secret.
The contested extracts relate to comments made by
an unnamed Foreign Office official tasked with
reviewing a public Home Office document sum-
marising conditions in Rwanda, which was being
updated at the same time as ministers were plan-
ning their controversial policy. – The Independent



17 The AXiS XLI Friday 19 Aug 2022 Business Around The World

Copliima ate-related drought and flooding in Ethi- still outpacing capital cities. Mwthhaaeevlmiknnbgeoetuwrntsooforokfsr,eAr2vws4ilicetehhfso.austrosnm,ineceripptarparltiisnngocoflamrtghpeeanpiceaosrutsnwtroilyfl
Odfcrpthallaroinieormnoetu.sdwaMgithnopoeitgrlafls.criittohnsonMadunsofroitogflhuuleoeirgofrEchnndtatshpeuaiecisonnoaoepddpsfi4elaest0npooeoairyrosentephqmdaleuferuraisanrc.cnehaionrEtegaahtnhsesdiraotithspittesoairanoihscwkiaeltmiottbraiilsdnyest CoreLogic’s latest regional market update abFfeofoectabtmeadlol nbfgaynstteh, netsosutorriifsktestsh.aonudsanhdoslidaoyf mpaaksesresngweirlsl
nnWhTmeuehoeeenersddgetegwrtforhoevaaogitennedirorn,n1maAs0as.ecfsnamicMsrto,tiraloaldnirOniocendnergottmphahteoaneioand,ptUhl74eenS..i44NatUerNedNmmP.fiiNallllcaiiaooitnninnodgnppssSeeeoosovauppeytrllheees found 10 regions registered modest value itsAimtnasputlieaionfcngtsw,oislfwul pittmhpheooroutafncftitfciroiopanmilc.sk–esttahTyelihinnepgeusItbnhlodeiuceytpseeiddxneepsdpeercinattetilcwothanye-
bahLneaoieswmnraerulsanuianldtbfeealdaeltlhitnscoohcmioanbrpvienetheswdet iftwharieiltsguhuirocehnhsisga.chnodnPtdeewmiotpiipodleenerssapthoruaevrvaeedesr dsbheeoacclwihnemsanadirnkectothuwenteraythkrnleieefsessmtyaolfentethrasreraetscootrhdJeu-blyrf,eiraskwt iinttohg Petrol prices set to fall as oil drops back below
the past four years. – Deutsche Welle rises during the pandemic. Ukraine invasion level
Australia’s wages rise 2.6% in year to June Regional growth slowed from a peak of 6.4% loMefvoetsloosrritsssteseanfmtewaryheofniilnRaplurlyiscseihasavifneevllasdobemadcekUgkboreoaldionwen. etwhes
and continue to lag inflation jiimunnogmnDptceheodscmet1mob7ib%nJeuerldyo.2vBc0ear2upa1tliltiattliosncamt0wh.eeh2i%caphsasdotewvxyeeprelelairrnti,hegenocvueattphdluareeceas- mApBermeredneirtacitecCenartnfuedtlboelen0sc$.l4ih9pm4pp.ea2edr1rkoc(pne£rn7itTc8eut),oe, sWd$wa8ehys8,it.l9edT8reotx(ph£ape7sin4NgI)n.ot0ret.rh8-
ahcsiAntaleemuclaplosdsostmlrsiatnaetlotseiea.’ingshienhaxftwllttaaytgtmiehoeaeonsrns tdrrhboae’utcsseelt,injsoaetabitlslignthalseepuhsmsoflumaitksshieteatehlnsyoftlohdrtr’aoasltfmefrotuehiraeneell 5.4% rise over the same period. – The Guard- pscsiDnaparronuaicvrdsrketueeiedroccsdeenrnWshtfaoeeovfsanwetresceRrfrenauukacdsbsegseodio.auav,trfeettrechgnroelmrodwbethnaopeltrsrlidcow’teioslsarsraseetuctipanotlhpnieladiUt-eeplskaurrwmagaieinnptsdhest
TqaAWwannuhoueddaesudrtltnr0dew0ae.rl.8sa7idr%agf%ianresoye.impnBfErariuobctcahromoeeenuayotiueqnmpaud2rrieaeo.s7vrxtfats%iegorrohuS.o,astsoadenstietsph2atarrs.iee6ncodes%niacaltmnrlieeynndopunoatattrhhldhteeejsudb, sWJatusteohniPdsneeI,, ian fOroilmprthiceeisr pheaavke infalMlenarcbhybumtoprerictehsanmaay tthaikrde
UwtBshhanoarnnirinokkkneprssahbhyayaasvspaeaabcclbooskeuoseetttsnsf3lco%ahafgallgvilieneindvgigntfhrgrooeerwarlmcnisu.oeirrnrTeecmnhosteumucpefhRpinoeacfrsnatoescurftivoleaderrl Google fined $43M by Australian court for several weeks to filter through to forecourts. –
year. – The Guardian misleading users over data The Independent
UtiaStiaonnds Taiwan announce formal trade nego- An Australian court has ordered Google to Egypt central bank chief quits amid deepen-
TfaeorfhtreemNr aaUalnScctyroahndPateresolovnaseenirg.nsoioatuilantvcioiesndits btwhyaittUhSthTeHayiowuwasniel,lSwbpeeeegakkins- pay roughly $43 million ($60 million AUD) ing crisis
TiRnheep"reefaisrreslnyttarfotaiuvllne"d., osafidtaltkhse aOreffeicxepeoctfedUSto Tberagdine pufoseretitmioofinstlhewaeadirticnhlgodcouagtsieosrnsaiddaabFtoaru,itdaatnyh.eAucostlrlaelcitainoncoamnd- TArccerohmipuseoinesrtrt.gr,eyodvr,ieenwsrnigiotthnhreedtohgferoiEpAngryoaWpbf te'awsdondcreelesdend'ptasreyan,mlinobsgstaatntepekco,opnmTuoalemordeuiiqacs
sfTathacneilidirtaartddioiss.nc,ussdiiognitalwiltlradinecluadned taanlktis-coornruptrtaiodne The court found Google breached Australian Pr2yreee0rpsea1iosrg5,irndteaeatdtnnhi.otdenhAsoabtdfadteeAbl-emoewFenrna,tedtdwauhehontaeoltw-oSssotipkasayipueoparnccheAiuspnlt-tpeiAldohsnrtatehmixnet
vbRieeselinat.tioinncsreabseitnwgelyententhsee fUolSlowainndg CMhsinPaelhoasiv'es Consumer Law between January 2017 and De- StrheipesrilaecnewamahsiemdnoaAtimmthemer ecdaeianptterraelswidboeardnntkioa. ln awdhvoisewr oubludt
sTTihrdaeedseUnowSw-aTsasaifwyiriasntng utInhnveieytiialhetidavdein"roenJaucnh2ee1,dstwcoiCtnhseennbtusourtyhs cember 2018 by misrepresenting to some An- Hhldouaewnridenlssegtavaeettxhsce1hw9anc.i1tughrertetorhnaectteyhE'eosgnyUbprSretuicatonadrlodpl,ldoaeeurx,vncadeilteuscdahetisadoenncgooinnnilgnyd
on the negotiating mandate".–Associated Press idcnorgolliedtcotutahsneerdsAuuwssethraaptleiarssneotnCtianolgmslopceaatlilttoiioownnedd&atGaC,oooangcslcueomrdteor- winter 2016. – AFP
U.N. chief to meet Zelenskiy, Erdogan, with Commission’s announcement. Saudi Aramco profit surges 90% in second
focus on grain exports, nuclear power plant The court found that Google represented to quarter amid energy price boom
pcUamUonl.kaeNndnerc.atteinrTUStnoeeukscrrtkoraaoeinibpstnaohirTuatyhnth-ePGutPhrreeasrenesdgiseaZediryndaea,depnlanotw.tAriitzVnThhtoaozlygnhoyriidaoiaypinmnGuyEeucrxrltedepZaroorergreltaespsnnoswwakniiielndyrl lwcsoooacmlsaleteictohtuenesd,eo,rbnskulyetthpoatantnaeotnhtthdehear“utLs“aeoWfdcfeaectdbitoaetnd&a wHaAhibsepottopuhrteyAr”acGstuieovstotieitgrny’lg”es S9rp"eBr0aciu%icogdersidOsucohirloiag.ln"leftignyiinuaeneartsetrocAeosrnduadrlmitvscqeoounahrritesSetpuroonrrnidtceeatdyw,iinaancsdosfhmatuilgelnshnaifonnoidgrl
iTsiPsniuhha-tp'eisenlertiasrtnodiwvlneaiartcsedeihrioasanilcsnuomsmrsneeiecoetFentnieRntbwug.smits2hmio4an,naZtrheakPsllse.trhneossEkiudrigdyehongst tiahnVnec'lesaTdRiufmiurrkssi-r-t setting also let it collect and use the data AtbT$o4ihrl6laepim.ou2nsrceh,obsiuuiltsllpsitaoinsdfee.racossomtirnlyodn$gqb2ue5maa.5traterabrknielnaltileoytcnsoitnsn’acdoietmyisoetenaimrstoaehtea$esr4llp8ieeo.rd4f.
detWTifianhnexnehrvgeepateeadlonstnBrwrtciatehaoesilesnrmnadsesca.theaeikftyadtGetvloperSeauaaoftettditehEanreereeerutrraisnesrrpsuofosioom,mnwoprrgneteiewl,deUlahtospikhiofnlunwraognacnlosOidedasnrerdsiirrnaaoeReivnnnsuaLejaionsd,vrFsigeiUnirvfawitu.i,dg'Nnghsaanl.oeeyn-eebrLbFwesraivteomoslibkhvgp.fcveeroooraaio2oesrnditindn4d---t when turned on, the watchdog said. – The "illiNynonOacwdsuruaesersessattrsryiarn,se"uagciplodoAsdr.wtderram–e-cmaaomCscnseotdNcoBcpfPnoaCrdrorre-bdsqoouiuduncaerernrtpetinrrwotaedinnturdhsecisttusiCoelnsEtpseaOritonircAfeufmlltteahhicrnee-t
crisis. – Reuters Hill Pharmacies ordered to pay $650m in US opi-
Australia’s regional property boom slows but Ukraine ‘could lose crops for at least 100 oids suit
housing stress still a major concern ysieaanrsindvuaesioton’metal pollution caused by Rus- Al(ian£r5gft3eew9dso.te8rmaOpl)hhjaiuforodmrgcaeochuyhenlatpsicienhsrgau. ilnefsduetmlhauatstApampinaekyriiclla$e'6rs5c0thr.i5rsemies
TseWlnhoaaewlle”sregiangrnoidowtnrQtoahlpu,hehayelontuhshlsoaoiunntgsgdphoabtofsotveoermaracylreloaissrtssheboNefmgei“wanprnhkieenSntgooiumsttoh- Fleaarsmt e1r0s0inyeaUrskradiunee tocoumldetallospeollcurtoiopns cfaourseadt IBcTicmnorhoeupeoaNnattetsocmitveaoseAn.nomeflbloyieavtrnhew,cersiaelu,lcpfrepbiCdsleyieVsruSaoslifencdaaondLutddoratikcehtfWioevualeaplnnmdodcapoWritmToairbdluhgamertpelbpietluehnlsldesl.
by artillery bombardments during Russia’s ille- The companies plan to appeal.
gal invasion, new research warns. –pNfaMedaenidiBlantilarBkiclnotyiCeylnldlsehNraaoeltnfoowfdvasepoOrmepdxoioiayplstlCleeieos-obnniabtnsdieneetdwtahotehevepsenarUwinS1tekh9riee9lhl9ealaravtsstaertnibsd2buu0ect2ceh0ody1meat9aoesr.s.
sTgprhareeinadcsouauprnptitllrylyer-yparndodadmuhcaaegssebemfreounmchsuRboujfescstiteahdne taowttoawcrilkddse’.s-
A new study has discovered heavy metal pol-
lution from shelling during the Battle of the
Somme more than a century later.
Ilinot gnghf-atrseormmbegeerfnefencadtdsuebsobfteoedxhpe‘lboaosvimyvebatrumtriulblnaetirityoi.onn’s, -ranthge-
The phenomenon was identified in soil collect-
ed from craters on the front line in northern
France.
An analysis found the dirt contains elevated
levels of copper and lead - which destroys
plants. – The Independent
tIonfsloaatiron hits 10.1% as cost of living continues
fTuhrethecrossttroafinlivoinngunsdoearr-epdreasgsuairne ifnamJuilliye,spauctrtionsgs
the UK.
Consumer Prices Index inflation (CPI) reached
OT10hf.fe1ic%iencfrloaersatsNe amwtiooannstahll,arSgbteealatyitsitndigcoswe(nOxpNteoSct)faotroioedvnesp,arliectdhe.es
and staples including toilet rolls and tooth-
brushes, the ONS said.
Ten9s.oh8tmie%mic,amste.aescacsoucrardelcinuglhaatdetod babenyen aPvaeenxrtpahegeceotendofMtoaancraorleyeascctosh’-
It is the biggest jump in the cost of living
since February 1982, when CPI reached
t1Iit0o.in4s%ianl,soJaucacnoemr.da–isnsgEivvetoenjuOinmNgpSSftreaosnmtidmatarhtdees9..4% infla-
Train drivers to strike on Saturday in dead-
locked dispute
RwSaaittihul rdpmaaysosreebnegcieanrudssueswtroiilafll sstaurcifktfieeorsn fbrpyelsahtnrnaeimndisdeirrnyivetorhsne,
coming weeks amid the worsening disputes
over jobs, pay and conditions.

The AXiS XLI Friday 19 Aug 2022 18

Markets
watch

Zimbabwe dollar shakes off 3%,
edgescloser to ZW$500:US$1
T he local currency shed by 3% against overall 2022 growth, amid intensifying load day, amassive drop from $134.30 million
the United States dollar on the latest shedding, adverse weather conditions and traded on Monday.
RBZ-governed auction market held on higher production costs. Naira closed at N680 to a dollar on the
Tuesday, data from RBZ shows. Meanwhile, elevated inflation will have black market Tuesday.
The under-fired currency traded at 494.9883 dented household spending. The South Afri- Meanwhile, the Nigerian government is
from 478.6358 registered last week. However, can Reserve Bank raised the key repo rate expecting the official exchange rate for Naira
the number of bids received and the amount by more than expected 75 bps at its July to the dollar to be devalued by 6.19% in
allotted fell sharply compared to the prior 22nd meeting and signalled further aggres- 2023.FG in its budget circular call for 2023
week. sive monetary tightening ahead to tame the sent to the heads of Ministries, Departments
The number of bids on the small auction surging domestic inflation. & Agencies (MDA), projects the Naira
decreased to 328 while on the main auction Inflation topped 7.4% in June, the highest exchange rate to the dollar at N435.57 com-
to 134 compared to 535 and 176 recorded last since May of 2009. Meanwhile, the govern- pared to the N410.15 used for the 2022
week. There was also a sharp decline in allot- ment is cutting fuel pump prices in an budget.
ments from US$21.5 million last week to attempt to ease pressure on household Nigerian currency in recent months has come
US$16.6 this week. finances and cool inflation. under intense pressure over forex scarcity
The sharp decrease comes at a time RBZ and black-market traders’ activities. FG also
plans to clear a backlog of US$169 million at dKoelnlayransincSehWilliilnligam pRluuntog’ess vicatgoaryinst expects the pressure to continue into 2024
an unspecified time and also the auction and further depreciation to N435.92. Howev-
market has shifted from auction market to Kenya’s currency, the shilling weakened er, it is expected that in the fiscal year of
allocation market. The Central Bank governor against the dollar on Thursday after the 2025, Naira will recover to N435.57.
has shifted from his rhetoric that the auction country’s election commission announced
was meant to “discover” the right exchange Deputy President, William Ruto winner of Kwacha continue firming
rate after announcing that the platform will be the country’s disputed elections.
only responsible for forex allocation. On Monday, August 15th, the Kenyan shil- The currency of Africa’s second-largest
“In this context, the foreign exchange auction ling was trading at 119.25 shillings per copper producer continued firming after clos-
system is no longer a price discovery mecha- dollar but fell to its lowest level against the ing the Thursday session at 16.1800 against
nism but instead the most ideal allocative greenback on Tuesday, trading at 199.50 the single greenback, also above the perfor-
platform of foreign currency in the domestic shillings, a downward trend that extended to mance of the Rand. The kwacha will likely
economy given the geo-political constraints Thursday. gain next week due to sustained central bank
facing the local banking industry to establish The currency of East Africa’s largest econo- support and favourable sentiment after Zam-
an efficient interbank foreign exchange my has fallen by 6.46% against the US bia’s official creditors assured that they
market,” RBZ governor John Mangudya said dollar since January. Kenya’s incoming Pres- would restructure its debt.
in his latest mid-term Monetary Policy State- ident would have to confront concerns The Central Bank of Zambia kept its key
ment. about dollar supply head-on. Kenya serves interest rate at 9% at its August 2022 meet-
Since the commencement of the auction as a commercial hub for East and Central ing, citing upside inflation risks, lingering
market on 23 June 2020, RBZ has allocated Africa and is home to the regional offices vulnerabilities in the financial sectors and
US$3.43 billion to the currency auction. of large corporations like Alphabet and weak domestic growth. The annual inflation
Meanwhile, the highest rates and lowest rates Visa. Foreign investors frequently trade the peaked at 24.6% in July last year and
received for the Zimbabwe dollar against the country’s equities, bonds, and shilling in declined steeply until June, when it reached
US dollar marginally increased, a greenlight Africa. 9.7%, before edging up to 9.9% in July.
that the gold-backed currency might get Meanwhile, inflation forecasts were revised
remorse in the long-term. FNXairsacasrlciditeys pfeurrstihsetsr against dollar as lower to 11.4% in 2022 from 12.5% seen in
May, before falling back within the bank's
Regional Markets The Nigerian currency, Naira, continued its 6%-8% target range during the first quarter
poor performance against the United States of 2024. The real GDP growth is now seen
Rand trades at one-week low dollar as forex scarcity piled more pressure at 3.1% in 2022, down from a 3.5% projec-
on the official foreign exchange market tion in May.
The Rand traded at a one-week low on Tuesday.
Thursday at 1R6.5 against the single green- Data from the FMDQ Securities showed Pula closes at
back which is the lowest since August 9th, that the Nigerian currency closed with
amid a strengthening dollar after disappointing N430.67 at the Investors and Exporters The Botswana Pula closed at 12.6263 on
economic data from major economies rein- (I&E) window on Tuesday. This represented Thursday, August 18 from 12.6103 in the
forced global recession fears. a 0.15 percent drop in value when com- previous trading session. The Botswana Pula
On the local front, the under-performance in pared to the N430/$ recorded at the official- is expected to trade at 12.61 by the end of
the mining and manufacturing industries market on Monday. this quarter, according to Trading Economics
through to the end of June cemented expecta- A total of $50.40 million was traded by global macro models and analysts’ expecta-
tions that South Africa's economic activity participants at the official market on Tues tions. Looking forward, it is estimated to
will shrink in the second quarter and drag trade at 13.09 in 12 months’ time. Historical-
ly, the Botswana Pula reached an all-time
low of 12.85 in July this year.

ZSE WEEKLY COMMENTARY

The ZWL denominated bourse, ZSE, continued its bear run during the week under
review as sell-offs continued to boost supply while demand was weak as liquidity is
being stifled. The mainstream ZSE All Share Index fell by -5.64% to close at
14438.57 points, a 5-month low.

As investors exited the bourse for viable asset classes, losses in the week were
distributed evenly across all major market indexes. This comes at a time when the
stock market has switched from being the best performing in the world to being the
worst performing as inflation climbs to 256.9%, the worst annual inflation rate in
the world currently. At the end of the week under review, ZSE nominal year-to-date
gains had been reduced to 33.41%, representing a loss of -71% in US dollar terms.
The ZSE has lost -12.99% since the beginning of August as the bear run, which
began after contentious policies in April and May, enters its fourth straight month.
At face value, only Zeco and CFI appear to be outpacing yearly inflation, with nomi-
nal YTD growths of 500% and 295%, respectively.

ZSE ASI 15,302.35 ZSE TOP 10 9,303.29 MEDIUM CAP INDEX 31,282.13
ZSE TOP 15 15,129.49 9,154.38 31,257.30

15,093.23 9,151.60 31,065.16

14,821.96 8,990.45 30,448.09
8,905.13 30,309.56
14,687.84

14,438.57 8,736.23 30,031.81

-5.64% -6.10% -4.00%

10,325.99 SMALL CAP INDEX 514,120.14 ZWL INTERBANK 478.1262
10,169.93
519,398.75 481.8543

10,157.30 502,399.19 485.4088

9,978.43 519,211.55 488.6269

9,893.76 503,546.76 493.0657

9,711.91 490,639.15 498.5334

-5.95% -4.57% 4.27%

On global markets, Asian shares tracked lower on Thursday, as even the prospect of
a less aggressive Federal Reserve has still set the U.S. central bank on a path for
interest rates to stay higher for longer.
Padenga stock grew by 0.9% to US$0.336/share on the VFEX exchange, a US$
denominated bourse. A total of US$24,573 was traded on VFEX during the week

under review, up from US$9,257 the week before as BNC, Padenga, and SeedCo Inter-
national kept up their strong trading activity.
Despite the Central Bank's attempts to absorb surplus liquidity, the local unit ZWL

continues to devalue daily against the US dollar on official currency markets. In con-
trast, the local currency has appreciated against the dollar on the black market. The
interbank exchange rate increased by an additional 4.27% during the week, from
ZWL478.1262 to ZWL498.5334 per US$, while the exchange rate on the Reuters Auc-

tion Market increased by 3.4% to ZWL494.988. The ZWL has recently appreciated
dramatically on the parallel currency market, reducing the premium between the cur-
rency markets from over 100% to roughly 60%.



21 The AXiS XLI Friday 19 Aug 2022

Weekly
Commodity Pulse

Gold (US$/oz) Copper (US$/t) Nickel (US$/t)

Gold recorded its first weekly drop in a month Copper prices dropped by 0.16% as compared to In the week under review nickel prices con-
after hitting a three-week low, under pressure from the previous session in the week ended August tracted by 3.38% to close the week at
a stronger dollar and rising U.S. bond yields as 19th this year as demand fell. Analysts expect a $22,258/tonne and YTD gains were at 7.23%.
the Federal Reserve looked set for more interest tight supply situation to ease. Copper scarcity may Unlike crude oil and refined petroleum prod-
rate hikes. In the week under review, gold prices emerge as a key destabilizing threat to internation- ucts, Russian-produced nickel hasn’t been
tumbled by 2.90% to close at $1,763 from a pre- al security in the 21st century, an analysis by S&P sanctioned, allowing its use in the production
vious week close of $1,816. The YTD movement Global found this week. of batteries to continue.
of gold also slumped by 2.90% in the week under
review. Spot gold fell for a fifth straight session, Aluminium (US$/t) Brent/Oil (US$/b)
down 0.4% at $1,750.51 per ounce in what could
be its longest losing streak since November 2021.
Ahead of the next Fed meeting, traders will be
heavily focused on the annual Jackson Hole eco-
nomic symposium, jobs data and inflation data.

Platinum (US$/oz)

In the week ended August 19th, oil recorded
a 1.46% fall in prices and closed the week at
$97/barrel.

Platinum prices plummeted in the week ended 19 Aluminium prices continued contracting, shown by Even though oil prices have fallen back from
August this year and recorded a decline of 7.71%, a fall of 1.99 % in the week ended August 19th their recent peaks, the world's biggest con-
and also dropping 7.96% YTD. Analysts and trad- 2022. In the week under review, YTD losses sumers aren't biting as much. In other news,
ers have sharply lowered their price forecasts for closed the week at 15.01%. China, the world’s Aramco is ready to ramp up oil production to
platinum and palladium as a global economic biggest metals producer and consumer, made a 12 million bpd whenever the Saudi govern-
slowdown reduces demand. record 3.43 million tonnes of aluminium in July ment asks this of the company, CEO Amin
In other news, The Directorate for Priority Crime as smelters did not have to contend with the Nasser said this weekend, as quoted by Arab
Investigation (Hawks)-in South Africa has arrested power restrictions imposed last year. Trading News.
three suspects for the possession of platinum. In house Sumitomo Corp expects Japanese alumini-
other news, Sibanye-Stillwater released a trading um premiums to remain at between $125 and
and operating statement, representing a decline of $175 a tonne next year, against $148 this quarter,
47% to 52% compared to H1 2021 primarily due although changes in Russian supply could be a
to industrial action in South Africa and severe swing factor, a company manager said on Thurs-
regional flooding in the USA. day. In other news, China’s aluminium imports in
July slid 38.3% from a year earlier, government
data showed on Thursday, as domestic production
rose to a record and overseas supplies tightened.

FINANCIAL MARKETS AT A GLANCE 2022

ZSE All Share Index ZSE Top 10 Index ZSE Small Cap Index Interbank Market Rate

15,919.77 9,757.23 512,386.23 460.7741
-4.17% -5.01% 2.69% -4.93%

ZSE Top 10 Index ZSE Small Cap Index ZSE Medium Cap Index

All Share index ZSE Top10 index All Share index Small Cap index All Share index

Medium Cap index

15,919.77 498,980.65 15,3931,90.6717
10,271.70 15,919.77
YTD 57.7%
WOW -5.01% MOM -26% YTD 43.2% WOW 2.69% MOM 3% YTD 27.2% WOW -2.66% MOM -21%

ZSE Financials Sector ZSE Consumer Discretionary Index ZSE Consumer Staples Index

All Share index ZSE Financials index All Share index ZSE Consumer Discretionary index All Share index ZSE Consumers Staples index

25125.06 24107.82 15,919.77
15,919.77 15,919.77 19460.96

WOW -2.8% MOM 0.9% YTD 74.2% WOW -4.6% MOM -16% YTD 87.8% WOW -7.6% MOM -31% YTD 31.5%

ZSE Industrials Index (New) ZSE ICT Index ZSE Materials Index

All Share index ZSE Industrials Index (new) All Share index ZSE ICT Index All Share index ZSE Materials Index

17948.17 1255,999109..6767
15,919.77
15,919.77
WOW 6% MOM -11% YTD 0.5% WOW 2.2% MOM -20% YTD 61.8% WOW -3.9% MOM -26% 12264.39

ZSE Real Estate Index ZSE Real Estate Index Interbank Market 28.1% JSE All Share Index YTD 35%

All Share index Interbank All Share index JSE All Share index 68610.57

15,919.77

15,919.77 -24%
12115.97
WOW -6.8% MOM -28% WOW -0.0003% MOM 3.4% YTD -6.9%
YTD 28.7%

BSE All Share Index LUSE All Share Index NGSE All Share Index

BSE All Share index LUSE All Share index NGSE All Share index

7264.76 6909.55 50594.97
15,919.77 15,919.77
15,919.77
YTD 3.64%
WOW 0.17% MOM 0.8% WOW 0.24% MOM 1% YTD 14.02% WOW 1.87% MOM -2.1% YTD 18.44

Company Latest Price Previous Week Consumer Latest Price Previous Week Materials Latest Price Previous Week TOP 5 WEEKLY RISERS
Staples ZWL Cents ZWL Cents ZWL Cents ZWL Cents Sector ZWL Cents ZWL Cents
African Sun COUNTER PRICE CENTS CHANGE % CHANGE
AFDIS 33000 33295 AXIA 1709.09 1420 ARTZDR 1700 1700
ARISTON 235.51 220 EDGARS 7518.11 7993.36 LAFARGE 11998.24 12030 African Sun 1709.09 267.27 19%
BAT 242000 242857.14 NTS 600.03 626 PROPLASTICS 2500 2401.43 UNIFREIGHT 5000 650 15%
CFI 37000 37500 RTG 1175 1025 TURNALL 457.01 457 NTS 1175 150 15%
DELTA 22241.47 26477.02 SIMBISA 900 940 Willdale 261 252.5 GBFS 1700 200 13%
DAIRIBORD 3000 3034.44 TRUWORTHS 19995.08 21889.59 RioZim 9400 11000 NAMPAK 1200 100 9%
HIPPO 24700 24704.82 203.94 220
INNSCOR 29248.82 29996.23 ICT Financial Latest Price Previous Week TOP 5 WEEKLY FALLERS
MEDTECH #N/A #N/A Sector Latest Price Previous Week Sector ZWL Cents ZWL Cents
MEIKLES 10900 10700 Ecocash ZWL Cents ZWL Cents COUNTER PRICE CENTS CHANGE % CHANGE
NATFOODS 175000 175000 ECONET 5000 First Capital Bank 990.33 1052.86
OK 3000.91 2995.13 ZIMPAPERS 4909.02 15728.96 CBZ 13201.62 13500 DELTA 22241.47 -4288.3 -16%
SEEDCO 9000 9005.47 16445.16 459.18 FBCH 6062.5 6580 TSL 8500 -1500 -15%
STAR AFRICA 160 160.41 Real Estate 500 FIDELITY 2200 2200 RioZim 9400 -1605 -15%
TSL 8500 10000 Sector Previous Week FML 1740 1740 NMBZ 2000 -300 -13%
Tanganda 13858.15 15200 MASHHOLD Latest Price ZWL Cents GBFS 1700 1500 FMP 900 -119.78 -12%
FMP ZWL Cents 500 NMBZ 2000 2300
1019.78 ZBFH 12200 12200
499.59 ZHL 361.86 362
900

JSE All Share Index BSE All Share Index LuSE All Share Index NGSE All Share Index

68610.57 7264.76 6909.55 50594.97
-0.0003% 0.17% 0.24% 1.87%

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