By Tawanda Musarurwa

HARARE – The World Bank has approved the commence-ment of financial support to Zimbabwe’s private sector by the International Finance Corporation (IFC), Reserve Bank of Zimbabwe governor Dr John Mangudya has said.

The approval was granted on February 9. The IFC is a member of the World Bank Group which finances and provides advice for private sector ventures and projects in developing countries.

RBZ governor Dr John Man-gudya said the approval was one of the outcomes of the on-going re-engagement process.

"We are quite pleased that the World Bank group

approved that the man-agement of IFC proceed to

prepare a new investment programme for projects for

News Update as @ 1530 hours, Wednesday 09 March 2016

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IFC re-commences Zim private sector financing

Zimbabwe when it met in February. That is a big suc-cess story for this economy because IFC are known for providing capital or providing new lines of credit to banks and therefore the approval in February will go a long way.

"It is one of the success story of the re-engagement process. What it means is that investment projects can now go to the World Bank Group board for approval," he said.

In 2014, Finance Minister Patrick Chinamasa made a plea to the IMF to persuade the IFC to resume financing Zimbabwe's private sector.

The RBZ governor was speaking at a Ministry of Finance and Economic Devel-opment and International Monetary Fund joint press conference where Minister Chinamasa announced that Zimbabwe had successfully met all its quantitative and structural benchmarks of the third review of the IMF's

Staff Monitored Programme.

This means Zimbabwe has successfully completed its SMP and can now move to the next step of develop-ing a medium-term reform programme as it steps up efforts to normalise relations

with the IMF.

The IMF's head of mission to Zimbabwe Domenico Fanizza urged the country officials to improve fiscal discipline going forward for the pro-posed reform programme to be a success.●

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RBZ Governor John Mangudya

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Zimbabwe and South Africa are set to further strengthen economic ties with a busi-ness delegation expected in the country next week.

Official figures show that South Africa is the single largest trading partner in Zimbabwe, accounting for at least 40 percent of total exports and 60 percent of total imports.

Zimbabwe has had to bear to the brunt of a trade imbal-ance, more so in a situation where the depreciation of the South African rand (ZAR) against the United States dollar continues to under-mine the competitiveness of local exports.

But this could be one of the issues that could be topi-cal when the two countries’ State officials and business-people meet. Another will be the issue of investment between the two countries,

in view of the growing sig-nificance of intra-regional foreign direct investment.

South Africa’s Trade and Industry deputy minister Mzwandile Masina will lead the business delegation to Zimbabwe on what has been termed “a three-legged Investment and Trade Initia-tive” (ITI).

The ITI will take place from March13 to 19.

According to CBN, it is part of South Africa’s Depart-ment of Trade and Industry’s efforts to cement economic relations and increase trade and investment between South Africa and Zimbabwe.

Deputy minister Masina will lead a 30 member delega-tion to Harare, Gweru and Bulawayo.

The delegation consists of companies operating in the

agriculture and agro-pro-cessing, built environment professionals, oil and gas, mining and capital equipment and electro technical sectors.

The programme for the ITI will include business semi-nars, site visits, mini-exhibi-tions and business-to-busi-ness meetings.

The visiting South African companies have received assistance from the Depart-ment of Trade and Industry through its Export Marketing and Investment Assistance (EMIA) scheme. One of the objectives of the scheme is to increase export market access for South African products and services.

Trade between South Africa and Zimbabwe has displayed a positive growth trajectory. During 2005 to 2014, South Africa’s exports to Zimbabwe grew by 247,3 percent from 7,1bill ion rand to 24,8bill ion

rand with minimal contrac-tion recorded in 2006 and 2009. The current trade bal-ance favours South Africa.

“The mission to Zimbabwe will enable the South African companies to identify trade and investment opportunities in the country and to interact with Zimbabwean business-people and consider ways in which cooperation, partner-ships and joint ventures can be established in order to explore these opportunities,” says Deputy Minister Masina.

The ITI is also part of the dti’s integrated national export strategy aimed at developing new markets for South Africa’s value-added and manufactured goods and services, with an emphasis on Africa and the emerging markets.

- BH24 Reporter/Cape Business News●

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SA business delegation to visit Zim, but...

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HARARE – Econet Wire-less has diversified into home security service as the telecommunications opera-tor seeks to widen income streams in the face of declin-ing profitability from its core business.

The telecoms operator recorded a 52 percent slump to $23 million in net profit in the half year ended August 31, 2015, as weak consumer demand and government imposed service charge cuts and taxes took a toll on its performance.

Over the years, the tele-

coms operator has diversified into other sectors such as renewable energy, health and beverages.

To improve its profitabil-ity, the company in the past year instituted a variety of measures including retrench-ments, salary cuts and demanding a 15 percent price cut from its suppliers.

Under the new service, Econet Connected Homes, which is a partnership with its subsidiary Zimbabwe Online (ZOL), the operator, will provide 24 hour security under different packages that

also include closed circuit television and rapid response teams in case of burglary or other disturbances.

The home security system, launched Tuesday evening, allows users to monitor activities at their property and control it remotely using smart phones or tablets hundreds of kilometres away from home.

It has sensors for curtain and door movements, win-dows breaks, human move-ment, smoke alert or gas leaks and sends the users a message if any anomaly is

detected.

“You will be in full control of your home and you will be secure,” said the general manager for Econet Con-nected Lifestyles, Shepherd Hondo.

Under the connected Life-styles brand, Econet initially launched a vehicle tracking system which allows users, especially companies to monitor the movement of their vehicles.

New Ziana

.●

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Econet diversifies into home security

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BH24 Reporter

HARARE -The Zimbabwe Tourism Authority (ZTA), which is leading a delega-tion of Zimbabweans that are in Berlin, Germany for the International Tourism Bourse (ITB), is hopeful that the fair will help boost tourist arrivals in the country.

ITB, which is one of the world’s leading travel fairs, begins today and will run until March 13.

The delegation will seek to promote Zimbabwe as a world-class tourist destina-tion.

Germany is the world’s larg-est outbound travel market with 76 million travellers each year and over half the Ger-man population takes at least one holiday abroad each year.

And data from IPK Interna-tional show that Germany topped global outbound

markets in 2015 followed by United States of America, the United Kingdom and China.

According to the United Nations World Tourism Organisation (UNWTO)’s 2015 Tourism Highlights, Ger-many ranks third in tourism expenditure, with a total of $92,2 billion, after China and the United States.

The market is known for high spending averaging $2 100 per person per trip.

“Germany contributes 18 per-cent of European arrivals into Zimbabwe and ranks 3rd after the USA and UK, contrib-uting 26 355 arrivals, a far cry from the 76 000 arrivals attained in 1999, Zimbabwe’s tourism peak

“The Authority is thus seized with a challenge to surpass the 1999 arrivals by achiev-ing 100 000 arrivals from the German market by 2020; in line with the National Tourism Blueprint: Towards A $5 Bil-lion Economy by 2020,” said

the ZTA.

ZTA chief executive Mr Karikoga Kaseke said:“Travel fairs continue to be a signifi-cant and competitive tool for destination marketing and promotion for any serious destination eyeing tourism growth.

“Our participation at ITB 2016 is a positive move for destination Zimbabwe given our absence at last year’s edition.”

The delegation in Berlin includes companies and insti-tutions namely Africa Albida Tourism, Falcon Safaris, African Sun Limited, Civil Aviation Authority of Zim-babwe, Zimbabwe Parks and Wildlife Management Author-ity of Zimbabwe, Shearwater Adventures, Rainbow Tourism Group, Amalinda Collection, African Bush Camps, Zimba-bwe Travel Info, Musangano Lodge, Nyati Travel and Sikil-iza.●

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Zim tourism eyes lucrative German market

HARARE - The mainstream industrial index rose by a marginal 0.01 to close at 98.97 as gains were only in CBZ which gained $0,0050 to close at $0,1050.

Trading in the nega-tive was Natfoods, which sl ipped $0,0387 to trade at $2,4113 while NicozDiamond shed $0,0010 to settle at $0,0150.

Activity was l imited to nine counters.

The mining index was flat at 19.14 as Bindura, Fal-gold, Hwange and RioZim

maintained previous price levels at $0,0095, $0,0050,

$0,0300 and $0,1040 respectively - BH24 Reporter ●

ZsE12

Equities market gains

MovERs CHANGE TodAy PRiCE UsC sHAKERs CHANGE TodAy PRiCE UsC

CBZ 5.00 10.50 NICOZDIAMOND -15.01 3.00

NATFOODS -1.57 241.13

iNdEx PREvioUs TodAy MovE CHANGE

INDUSTRIAL 98.96 98.97 +0.01 points +0.01%

MINING 19.14 19.14 +0.00 POINTS +0.00%

13 ZsE TABlEs

ZsE

iNdiCEs

Stock Exchange

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14 diARy oF EvENTs

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

PoWER GENERATioN sTATs

Gen Station

09 March 2016

Energy

(Megawatts)

Hwange 506 MW

Kariba 470 MW

Harare 30 MW

Munyati 17 MW

Bulawayo 18 MW

Imports 0 - 500 MW

Total 1418 MW

•Thursday 24 March 2016 - Annual General Meeting of Willdale Limited; Place: Boardroom, Willdale Administration Block, 19.5km peg Lomagundi Road, Mount Hampden; Time: 1100 hours...

THE BH24 diARy

JoHANNEsBURG -South Africa's rand and bonds retreated early today as sentiment was rocked by Moody's decision late last night to place the country's credit rating on review for a downgrade over its worsen-ing growth prospects.

Stocks opened slightly firmer, with the JSE Top-40 blue-chip index inching up 0,12 percent.

At 0700 GMT the rand had weakened 0,2 percent to 15,4650 per dollar, gaining back some ground after slip-ping to 15,4700 overnight.

Government bonds weakened as well, with the benchmark issue due in 2026 adding 3 basis points to 9,315 per-cent.

"Comments from Moody's overnight have spiked the risk-off trade with bonds and currencies taking a beating overnight," analysts at Ned-bank Capital said in a note.

The rand, already on the back foot after Tuesday data showed the current account

deficit widened sharply, saw a modest selloff after Moody's said it was con-cerned about the ability of government policies to restore fiscal strength and boost growth.

Moody's cited weak economic performance in Africa's most indistrialised economy as a risk factor when assigning a negative outlook to the

rating in December 2015, and said it now expected the economy to grow at only 0,5 percent in 2016, slower than Treasury's forecast of 0,9 percent.

Moody's visits South Africa next week to assess the economy and decide whether to alter its Baa2 rating.

Finance Minister Pravin

Gordhan told local Radio 702 on Wednesday that South Africa had a good to story to tell Moody's.

"Clearly we need to prove to ourselves and to them that we are capable of working together to grow our econ-omy, create jobs and make our fiscal framework a viable one," Gordhan said. - Reu-ters●

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Rand, bonds retreat after Moody's puts credit status on review

ToKyo - Toshiba Corp has granted Canon Inc exclusive negotiating rights for its medical equipment unit after a hotly contested auction, with a report putting Canon's offer at more than 700 bill ion yen ($6,2 bill ion).

The conglomerate put Toshiba Medical Systems Corp on the block to help fund restructuring after a $1,3 bill ion accounting scandal, attracting a bevy of suitors, particularly Japanese imaging companies whose products range from cameras and copiers to diagnostic devices.

The second-round of bidding, which saw offers go much higher than first estimated, included Fujifi lm Holdings Corp, and Konica Minolta Inc which had teamed up with European buyout firm Per-mira, sources familiar with the matter said earlier.

Toshiba Medical, the world's second-largest manufacturer of CT scan machines, also makes X-ray and magnetic resonance imaging (MRI) systems. It had revenue of

405,6 bill ion yen in the past financial year.

Toshiba declined to com-ment on the size of Canon's bid. Canon also declined to

comment. The Nikkei busi-ness daily said Canon had won prime position to take the unit, not only because of the size of its bid but also because there was little

overlap between the two firm's medical equipment businesses, raising few anti-trust concerns.

Canon has been keen to develop its medical devices business and the purchase would jump start that effort.

"The acquisition of Toshiba Medical will allow Canon to create a new business pillar, on top of cameras and office equipment businesses," said Kazuyoshi Saito, senior ana-lyst at IwaiCosmo Securities Co.

"It might be a little pricey, but will generate profits in the first year. It is more rea-sonable than Hon Hai paying about the same for Sharp," he said.

The sale is part of a dras-tic restructuring at Toshiba after the company admit-ted to overstating profits from 2009. The costs of the revamp have forced Toshiba to ask lenders for additional loans of about 200 bill ion yen ($1,8 bill ion), sources have told Reuters`.-Reu-ters●

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Canon closes in on Toshiba's medical unit after fierce bidding

By Kurt Cobb

The $9,2 billion investors paid to snap up new equity offerings from US oil companies in 2016 proves those investors are indeed ready for more punish-ment.

The amount is in line with the pace of such equity offerings in 2015 even as the mood in the oil markets has grown increas-ingly dour. In June of last year I wrote:

New investors in US oil com-pany shares must believe they are catching the bottom and will have a very profitable ride up from here. This demon-strates that OPEC's work is not done and accounts in part for the decision to leave produc-tion quotas unchanged. OPEC's next task is to convince those making new investments in oil that, rather than catching a bottom in oil prices, they have caught a falling knife.

A lot of investors did end up catching a falling knife as oil careened downward from about

$60 a barrel last summer to Friday's close of about $36. Investors this year may still find that the knife is falling, though it admittedly doesn't have as far to fall this time around. Still, it seems they misunderstand OPEC's strategy or believe that that strategy will fail. As I said in the same piece:

The cartel must dampen enthu-siasm for investment for the long term if the organisation's members are going to benefit. A crippled US oil industry with-out friends in the investment world is the only way to assure that rising prices won't simply lead to a stampede back into US shale deposits.

It seems that the oil industry still has friends in the invest-ment world and that OPEC's work is therefore not yet done. The big question then is: Will OPEC stay the course or relent with a production cut this year to raise prices?

I doubt that OPEC will relent. As bad as the OPEC countries,

including Saudi Arabia, are hurting, to give up at this point would make all the previous suffering pointless. Saudi Arabia is really the linchpin in OPEC. No member can resist the will of the Saudis because they control such huge and flexible oil flows.

I have posited a speculative, but nevertheless plausible rea-son for why Saudi Arabia may not give up on its strategy any time soon: The kingdom may be at or near its all-time maxi-mum rate of production, a rate it may only be able to main-tain for the next decade or so. Naturally, the Saudis want to maximise their revenues during this period of peak production. They can't do that if US oil companies keep overproducing.

If the Saudis can neutralise those companies, by bankrupt-ing them or forcing widespread lease sales, this will allow major international oil compa-nies to buy up much of these distressed assets. The majors will develop these properties more slowly than the inde-

pendents did because 1) the majors do not have to worry about their ability to meet debt payments and 2) the majors do not want to crater the price of oil which would only under-mine the value of their newly acquired leases.

It is hard to imagine that the Saudis launched their low-price strategy on a wing and a prayer without thinking through how long it would take to force other producers to stop overproducing. But, investors keep hoping that the Saudis don't really know what they are doing.

So far the Saudis appear to have the upper hand, and I'm guessing that those buying newly issued oil company shares these days are mis-calculating once again. After all, the funding derived from these share offerings will only serve to encourage continued overproduction by making it possible for producers to hang on that much longer in hopes of an upturn. – Oilprice.com ●

17 analysis17 ANAlysis

The $9,2 billion bet against OPEC dominance