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18 The Standard August 3 to 9 2014 Business EU market opens for Zim products BY TARISAI MANDIZHA The European Union (EU) market is now open to all products from Zimbabwe free of quotas and duties effective this month, the outgoing EU ambassador to Zimbabwe Aldo Dell’Ariccia (pictured right) has said. This development follows the launch of the Zimbabwe European Union Business Information Centre (Zim-Ebic) on Friday in Harare to increase the capacity of Zimbabwean exporters to the EU bloc. Speaking at the inauguration ceremony of Zim-Ebic on Friday, Dell’Ariccia said the opening of the centre demonstrated the commitment by the EU and its member states to support the government of Zimbabwe and its efforts to restore the economy of the country by putting back Zimbabwe in its deserved position in the international economic community. “The European Union market is now open to all the products of Zimbabwe free of quotas and free of duty.” Dell’Ariccia said, without the srapping of quotas and duties, Zimbabwe’s sugar, ethanol, tobacco, fruits, vegetables would lose competitiveness with other countries. “Now you have an advantage and this centre serves to take the best possible advantage of this by knowing exactly what the conditions are of accessing the European market,” Dell’Ariccia said. “The EU is not an easy market because we have to respect the international standards, with all the issues related to consumer protection, but I always said when it comes to trade everything is negotiable, but when it comes to the protection of the consumers for the EU, we stop negotiating and follow the rules.” He however said the launch of the Zim-Ebic was done in cooperation with the private sector. He said the relationship between the private sector, public sector and the international bankers was very essential to make sure that Zimbabwe comes back on the track of solid economic development based on trade. ZimTrade chief executive officer Sithembile Pilime said the timing of the Zim-Ebic facility was very appropriate to her organisation which was actively charting a way forward for development and promotion of exports after the decline in industrial output and export competitiveness. “The facility will be instrumental in our endeavours to deliver effective trade information, which will assist exporters and importers alike in their trade activities with the EU. “Zim-Ebic is part of a bigger project under the EU-funded Trade and Private Sector Development Programme (TPSDP), which has other beneficiaries,” she said. She said the ZimTrade component of the TPSDP went beyond Zim-Ebic and encompassed upgrading the Trade Information Centre, redesigning the website staff training as well as reviewing and repackaging the Export Marketing Training Programme that imparts relevant skills to current and emerging SME exports. Mushohwe quells diamonds depleting rumours BY FARAI MATEBVU Manicaland Provincial Affairs minister Christopher Mushohwe says the country still has a lot of diamond reserves in Marange, quelling speculation the precious mineral was running out. Delegates who attended the Confederation of Zimbabwe Industries (CIZ) annual congress here in Mutare grilled the minister over the dearth of Mutare manufacturing industry and suggested that a Diamond Fund be established as a matter of urgency to rescue the distressed sector. Despite official claims that the diamonds were abundant in the eastern border area, reports claim the precious stones are fast running out at the diamond fields, especially the alluvial (surface) diamonds. “I’m not aware that diamonds are running out but what I can confirm is that our diamonds are still there in vast quantities. Government is restructuring operations in Chiadzwa and soon we will add value for the benefit of our people,” Mushohwe said. He said government was working flat out to restructure operations in Chiadzwa to add value and beneficiate diamonds through the economic blueprint, the Zimbabwe Agenda for Sustainable Socio-Economic Transformation (Zim Asset). The nation’s total diamond production from Marange increased from 8, 7 million carats in 2011 to 12 million carats in 2012. Timber Producers Federation board chairman Joseph Kanyekanye said, mining companies in Manicaland must pay a diamond depletion levy which would develop companies and capacitate social institutions that offer basic services to people and companies. He said a percentage of that would be used to revive companies in Mutare. “We should work towards relaxing our policies and allowing all mining companies to cede a diamond depletion levy that must develop companies, and capacitate social institutions that offer services to people and businesses. Businesses should create employment, but how do we create it when companies are downsizing and closing,” said Kanyekanye. Mushohwe concurred: “Yes, the diamond fund is critical. If given the chance, I would make sure that the fund exists. In fact, it would not only be diamonds but all the minerals that we have in Manicaland.” But CZI vice-president Henry Nemaire said levying companies was a form of taxing which increased the cost of doing business and must not be allowed to happen. “This is a form of taxation which must not be allowed. If you go to Singapore, companies and individuals are not taxed as we do here in Zimbabwe,” he said. “There is need to reform the purchasing and procurement laws by mining companies to force them into prioritising local industries when purchasing material for their business. This will empower our local industry and create the much needed employment.”
Business The Standard August 3 to 9 2014 19 Govt keen to resolve pensions row Most pensioners earn paltry pay-outs despite contributing money to the fund for many years BY OUR STAFF Insurance and pensions fund industry stakeholders are deliberating on the setting up of a commission of inquiry to investigate how policy holders were financially prejudiced by service providers when the country adopted the multicurrency regime in 2009. This follows a meeting recently between Finance and Economic Development minister Patrick Chinamasa and Insurance and Pension Fund managers. The meeting was aimed at establishing the extent of prejudice that pension fund members and insurance policy holders suffered due to the Zimbabwe dollar conversion and fairness of contracts. Hundreds of thousands of pensioners in Zimbabwe are failing to sustain a reasonable standard of living owing to paltry pay-outs despite contributing money to the fund for many years. Zimbabwe Pensions and Insurance Rights Trust general manager Martin Tarusenga said Chinamasa committed to meeting industry players soon to obtain input on how best to resolve the dispute between policy holders and service providers. “We shall have a few more meetings on the way forward. We gave our input at the meeting last week. The main issue remains on how policy values were calculated. Were they fair or correct?” he asked. “A substantial number of pensioners and insurance policy holders are not happy with the values of policies,” said Tarusenga, adding that the minister provided stakeholders at the meeting with government’s proposed terms of reference. Chinamasa said the industry should provide input on the terms of reference, adding that it was government’s intention to finalise the conversion process and recommend what would be considered fair by all players and stakeholders in the pensions and insurance industry. There is widespread dissatisfaction in the market with regard to the values originating from the conversion process, absence of consistency in values between various industry players, and substantial discrepancies in the value of policyholders who were contributing at similar levels. The meeting also discussed the criteria for choosing such commissioners — a key requirement in coming up with an objective commission of enquiry — according to stakeholders. The terms of reference point out aspects such as investigating the financial soundness of the Zimbabwe insurance and pensions industry before, during and after conversion from Zimbabwe dollars to US dollars, identifying all the causes of financial unsoundness, if any, and establishing how Zimbabwe could restore the financial soundness of the insurance and pensions industry. The terms investigate all instances of failure of regulation, governance, legislation and oversight in the running of insurance and pension funds, regulation and monitoring of the pensions industry and make recommendations on how to deal with the issues. The finance ministry is also expected to identify personnel for recommendation to President Robert Mugabe for the appointments to be made. Zimplats optimistic over indigenisation implementation plan BY OUR STAFF PLATINUM mining firm Zimplats says it is optimistic of a positive outcome on its indigenisation compliance discussions with government despite its proposed term sheet failing to sail through. Speaking at an analyst briefing last week, Zimplats chief executive, Alex Mhembere said the company was engaged in deliberations with government and lauded its community share ownership schemes. “Our largely celebrated term sheet has not sailed through but we are working closely with authorities in terms of our indigenisation compliance plan. We remain positive that we will find a solution and should be compliant as soon as possible,” he said. ““The company is still engaged in discussions with the Minister of Youth Development, Indigenisation and Economic Empowerment with regard to the company’s indigenisation implementation plan,” said Mhembere. However, a source close to the matter said progress on the matter was being stalled partially due to issues surrounding the valuation and leasing of land on which the company is operating. The mining firm holds a special mining lease over two areas in the country with a total of 48,535ha in extent. Last year, government expressed intention to repossess swathes of land under the mining giant’s claim arguing that the firm had too much land granted under its contract. Zimplats also signed a conditional, nonbinding term sheet for the transfer of 20% of Zimplats shares to employee and community trusts while another 31% would be channelled to a state-run National Indigenisation and Economic Empowerment Fund. In terms of this agreement, this would be for a total of US$971 million payable from future dividends due to the entities. Zimplats in turn would provide vendor funding to the indigenous entities at an interest rate of 10% per annum, repayable from 85% of the dividends declared by the operating subsidiary. Government has however indicated that it wishes to revisit the terms of the plan as neither party was bound by the terms and engagement in this regard. Mhembere said annual metal production in matte for platinum stood at 270 000 ounces, gold at 30 000 ounces, nickel at 5 000 tonnes, and copper at 5 000 tonnes among other metals. He told the meeting that all metals were declared at point of export, accounted for and invoiced. “However, our Community Share Ownership schemes are in place and being implemented. We are processing 270 000 ounces [of platinum] per annum and we need to grow this to 1 million ounces per annum; it’s part of our strategy,” said Mhembere.
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