The Standard 8 June 2014

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18 The Standard June 8 to June 14 2014 Business Rwanda leaps as Zim stutters Under the leadership of Paul Kagame, Rwanda has managed to weed out corruption BY NDAMU SANDU Twenty years ago, Rwanda was a sure candidate for the failed states’ club after the genocide that claimed a million lives of Tutsis and moderate Hutus inside a bloody 100 days. The perpetrators of that massacre were the Hutus in what was to become the darkest chapter in the East African country’s history. Though the scars of the genocide are still fresh, the country has moved mountains and has been one of the fastest growing economies on the continent, anchored on peace, security and national healing. Under the leadership of Paul Kagame, a handson President, Rwanda has managed to weed out corruption — the cancer of most African countries. “Traffic police officers are constantly changed to weed out corruption among traffic cops in most African countries,” a local, Joel Mugabe said. Good governance and investor-friendly policies have seen lenders stampeding to give Rwanda loans at a time Zimbabwe has been struggling to get loans due to the country’s over US$6 billion external debt. Rwanda’s debut Eurobond offer of US$400 million issued last year was oversubscribed by 8,5 times. Its US$18,3 million local treasury bond issued in February with a three-year maturity recorded a subscription rate of over 140%. The International Finance Corporation (IFC) five-year US$22 million “Umganda” bond, its first President Paul Kagame joins residents in community projects. Picture: Rwandapedia ZIMBABWE LIVELIHOODS AND FOOD SECURITY PROGRAMME (LFSP) AGRICULTURE PRODUCTIVITY AND NUTRITION COMPONENT (APN) PUBLIC CALL FOR EXPRESSIONS OF INTEREST (GCP/ZIM/025/UK) For Provision of Services for LFSP-APN PUBLIC CALL FOR EXPRESSIONS OF INTEREST - (GCP/ZIM/025/UK) The Food and Agriculture Organization of the United Nations (FAO) is an intergovernmental organisation with more than 190 member countries. Since its inception, FAO has worked to alleviate poverty and hunger by promoting agricultural development, improved nutrition and the pursuit of food security. To achieve its goals, FAO cooperates with thousands of partners worldwide, from farmers’ groups to traders, from NGOs to other UN Agencies, from development banks to agribusiness firms, research institutes to academic institutions. Further and more detailed information on FAO can be found on the internet site: http://www.fao.org The United Kingdom Department for International Development (DfID) is supporting the Zimbabwe Livelihoods and Food Security Programme (LFSP), which aims to contribute to poverty reduction through increased agricultural productivity and increased incomes. Targeting smallholder men and women farmers, the LFSP will address constraints to productivity, market participation and the supply and demand of nutritious foods. Under the LFSP, DfID is providing USD 48 million (GBP 30 million) worth of funds for a FAO-managed Agricultural Productivity and Nutrition (LFSP-APN) component. The programme was signed in December 2013 and will run until November 2017. FAO Zimbabwe is issuing this call for Expression of Interest (EOI) to request information on the availability and areas of expertise indicated in Annex I and Annex II to this EOI. From Interested Organizations/firms authorized to operate in Zimbabwe ALL THE RELEVANT INFORMATION OF THE ABOVE ANNEXES ARE AVAILABLE IN THE FOLLOWING LINK ftp://extftp.fao.org/SROs/Data/SFS/LFSP_EOI_Docs/ THE DOCUMENTS CAN BE DOWNLOADED UNTIL 16 JUNE 2014. IF THE INTERESTED ORGANIZATIONS/FIRMS AUTHORISED TO OPERATE IN ZIMBABWE HAVE DIFFICULTIES ACCESSING THE DOCUMENTS, CONTACT US ON EMAIL ZW-PROCUREMENT@FAO.ORG Interested Organizations/firms can be specialised UN agencies, private sector companies, financial institutions, Research and other public institutions, international NGOs local NGOs, professional associations and community based organisations authorised to operate in Zimbabwe. The programme will be implemented in the following eight districts (in three provinces in Zimbabwe): Mutare, Makoni, Mutasa (Manicaland); Kwekwe, Gokwe South, Shurugwi (Midlands); Guruve, Mt Darwin (Mashonaland Central). Interested Organizations/firms that wish to send the required information by FAO must complete the attached template and submit documents outlined in Annex I Part A to D, including the minimum legal, professional, financial and technical requirements. Interested organisations/firms should submit the requested documents in hard copy and on electronic soft copy on a clearly marked CD, in sealed envelopes, with the outer envelope clearly marked, “Public Call for Expression of Interest – (GCP/ZIM/025/UK) - Not to be opened by Registry” to the address below: The FAO Representation in Zimbabwe Attention: Procurement Unit Food and Agriculture Organization of the United Nations Block 1, Tendeseka Office Park, Cnr Renfrew /Samora Machel Avenue, Eastlea, P.O Box 3730. Harare Deadline of submission of all applications is 16 June 2014 - 10:00AM. The office is open from 0800hrs to 1700hrs from Monday to Thursday and from 0800hrs to 1330hrs on Fridays. Note: PLEASE NOTE THAT THIS IS NOT A TENDER, AND DOES NOT CONSTITUTE ANY ENGAGEMENT ON THE PART OF FAO IN TERMS OF PROCURING GOODS, SERVICES OR WORKS. BASED ON THE INFORMATION RECEIVED, FAO WILL LATER CONTACT INTERESTED ORGANIZATIONS/FIRMS THROUGH A FORMAL TENDER INVITATION. ALL INFORMATION SUPPLIED TO FAO WILL BE TREATED WITH THE UTMOST DISCRETION. local currency bond issued on May 15, received bids worth more than twice that amount. “Umganda” is Rwanda’s day of community held every last Saturday of the month. During this day, citizens gather to do community work and it is estimated that the value of such work to the country’s development since 2007 is US$60 million. Finance and Economic Development minister Patrick Chinamasa, who was in Rwanda after the 1994 genocide, said the country’s growth rate has been phenomenal. “I came here [Rwanda] in the 90s and Kigali was a village. Kigali is now a well-planned city and you don’t find slums,” he said. Chinamasa said Rwanda had achieved phenomenal growth anchored on discipline and an operating environment conducive to Foreign Direct Investment (FDI). “The lessons I have learnt is that let’s be clean and disciplined. Let’s fashion our policy framework conducive for FDI [inflows] while not forgetting to uplift our people,” Chinamasa said. Rwanda is security-conscious with heavily armed police and army officers maintaining a presence on the streets. To Rwandans, this has become a daily occurrence and they won’t bat an eyelid as long it doesn’t take the country back to the 1994 madness. Unlike Zimbabwe which has in the past come up with home-grown documents to grow the economy with little or no implementation, Rwanda’s programmes are followed to the letter. One such is the Agaciro Development Fund based on voluntary donations set up in which Rwandans contribute to the country’s development. The programme was launched in 2012 and the Rwandan government says it is now worth US$41 million. Rwanda’s journey has also been driven by discipline in the public service and parastatals. Performance contracts are signed at all levels of government to promote accountability and transparency in the public service. The Rwandan government did not sweep the 1994 genocide under the carpet. It set up courts to try perpetrators as a way of promoting national healing. The Gacaca Courts have resolved 1,2 million cases at a cost of US$25 million. This, according to the Rwandan government, was an achievement considering that the International Criminal Tribunal for Rwanda tried 58 cases at a cost of over US$2 billion. As part of the homegrown solutions, Rwanda came up with a national dialogue council which meets once a year. Rwandans come together to debate national issues, local government or national unity. “This is key in ensuring Rwandans participate in policy making,” it said. Rwandan Finance minister Claver Gatete said the cooperation with AfDB has been central to the country’s economic recovery. “The bank [AfDB] has contributed to our structural transformation efforts, and supported important macroeconomic and business regulatory reforms,” he said. Chinamasa said like Rwanda, Zimbabwe enjoys political stability and has to leverage on that for economic development. “The turbulence of the past is behind us. We need economic growth of at least 8% for 10 years to make up for the lost time and this is urgent,” he said. Critics say Rwanda has managed to use the “victims” card to lure both donors and lenders. “So far it has worked. We don’t know for how long,” retorted a government critic.
Business The Standard June 8 to 14 2014 19 NSSA to proceed with microfinance plans BY NDAMU SANDU THE National Social Security Authority (NSSA) will proceed to set up a microfinance bank notwithstanding the cancellation of an operating licence of its banking subsidiary, a spokesperson has said. Last week the Reserve Bank of Zimbabwe (RBZ) announced the cancellation of Capital Bank’s operating licence on the grounds that its major shareholder, NSSA, was no longer willing to inject additional capital into the institution. NSSA has 84% in Capital and the remainder is owned by Patterson Timba and his partners. “NSSA is working with its parent ministry, the Ministry of Public Service, Labour and Social Welfare, and the Reserve Bank of Zimbabwe to obtain the necessary regulatory approval,” the spokesperson said. The spokesperson said appropriate notices would be issued in due course concerning payments to depositors and other creditors as per RBZ notice on the cancellation of Capital Bank’s licence. The move to surrender the licence comes after the realisation that Capital Bank needed huge capital outlay and had failed to turn around since NSSA moved in. A NSSA board resolution called for the winding up of Capital Bank and the authority was mandated to apply for a microfinance bank licence. Despite the rebranding exercise, Capital Bank had failed to gain market acceptance from its predecessor, ReNaissance Merchant Bank (RMB) that had slipped into curatorship. RMB was placed under curatorship in 2011 after an investigation by the central bank unearthed the abuse of depositors’ fund by founding shareholders. NSSA moved into the then RMB in 2012 in a US$24 million deal for 84% shareholding. NSSA said at the time it was swooping in on RMB as a gateway to First Mutual Holdings Limited (formerly Afre Corporation). RMB had 33% shareholding in Afre. “What we have lost in Capital Bank, we have more than gained in Afre. Our intention was never in the bank, but Afre,” a board member said last year. First Mutual Holdings has interests in insurance, reinsurance and property investments, among others. Meanwhile, NSSA has gone for nine months with a board following the expiry of the term of office of the one led by Innocent Chagonda at the end of August last year. Chagonda was deputised by David Mutambara. Other members of the board were Kennias Shamuyarira, Cecilia Alexander, Chris Hokonya, James Matiza (general manager), Rosa Dube, Joseph Kanyekanye, David Govere, Ephanos Makiwa and M. Mukondami. NSSA has interest in banks, insurance and properties. It has 26,6% in FBC Holdings, the parent company of FBC Bank, 37,9% shareholding in ZB Financial Holdings that wholly owns FBC Bank and 10% in CBZ Holdings. The authority also has a controlling shareholding in hospitality concern, Rainbow Tourism Group. James Matiza Finance costs weigh down Ariston BY VICTORIA MTOMBA ARISTON Holdings Limited’s profit after tax declined by more than half to US$984 353 in the six months ending March 31 2014 due to a 48% jump in finance costs. In the same period last year, the company posted a profit after tax of US$2 million. In a statement accompanying the group’s results, Ariston said the borrowings for the group increased to US$14,1 million as a result of the rehabilitation programmes that the company undertook. Revenue for the group went up by 29% to US$8,6 million in the period under review. During the six-month period, Claremont Estate turnover of US$849 000 was 10% of group turnover, an increase of 12% compared to March 2013. An operating loss of US$606 000 was reported up from the US$365 000 operating loss recorded in the same period last year. Kent Estates recorded an increase of 98% in turnover to US$631 000 compared to the previous period and contributed 7% to the group’s turnover. South Down reported a turnover of US$4,1 million representing a 48% of group turnover. South Down recorded an operating loss of US$300 000 compared to US$90 000 loss during the same period last year. The group said the macadamia harvest was slightly delayed by the persistent rains. But despite the late start production was in line with last year. “Early season sales have started with firmer prices than last year. Despite the erratic power supplies, tea production was 40% up last year. This trend is expected to continue into the second half of the year and we expect forecast production for the season.” “With half the export teas still to sell, we expect a modest recovery in international tea prices in the second half of the year. Traditionally winter accounts for the bulk of blended tea sales,” the group said. The group said restructuring at Favco was complete and the combination of cost management and improved marketing of the estates’ produce was now producing acceptable performance. “Favco turnover was US$2,996 million and contributed 35% to group turnover. An operating profit of US$0,049 million was recorded compared to a loss of US$0,265 million in March 2013,” the group said.
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