Business News

Tue, 18 Apr 2017 06:25:59 +0000

$712m power import bill

ZESCO pleads for tariff hike to save money

BY MAILESI BANDA

THERE is urgent need for immediate increase in electricity tariffs to easy ZESCO’s liquidity challaenges, encourage investment in the energy sector and reduce the cost of importing power, ZESCO director for strategy and corporate services Changala Nswana has said.

Mr. Nswana said the country was currently unable to attract investments in the energy sector because the 3.3 US cents/kWh tariff was too low.

Speaking at a presentation on the need to increase electricity tariffs at the Zambia Association of Manufacturers (ZAM) meeting, he said the need for investments in the sector was aimed at increasing generation capacity to meet growing demand.

Mr Nswana explained that if the country did not move to cost reflective tariffs soon more money would continue being spent on importing power because the country did not have enough to meet demand.

He said Zambia would this year spend about US$712 million on the importation of electricity from Independent Power Producers (IPPS), adding that this was costly to the nation.

He explained that the growing demand for electricity necessitated the move by ZESCO to apply for an increase in electricity tariffs by 75 per cent this year.

“The factors that have necessitated this increase include the prevailing economic conditions, inflation, interest rates, exchange rates and the need for investments in the sector aimed at increasing generation capacity to meet growing demand,’’ Mr Nswana said.

He explained that other factors were the need to support ZESCO’s own investments in generation, transmission, distribution and supply; and the need to meet ZESCO’s rising cost of supplying electricity to its customers.

He said the consequences of not having cost reflective tariffs included under-investment in the energy sector, insufficient capacity to support accelerated growth in the economy and unreliable quality of supply of electricity.

He said if the country did not implement the move to cost reflective tariffs, it would fail to attract investment in economic sectors such as mining, industry, agriculture and tourism.

He said the company would incur higher energy costs to the entire economy such as costly imports, use of generators and others.

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Zambia to attend WB, IMF high-level talks

By BUUMBA CHIMBULU

THE 2017 Spring Meetings of the International Monetary Fund (IMF) and the World Bank Group (WBG) open next week in Washington DC at which Government is expected to continue talks with the fund for a possible economic bailout package.

The meetings bring together ministers of finance, ministers of development, governors of central banks and civil society organisations to discuss, among others, global economic affairs.

The Zambia delegation to the talks will be led by Minister of Finance, Felix Mutati, and Minister of Planning and Development, Lucky Mulusa.

The delegation will include Secretary to the Treasury, Fredson Yamba, and Bank of Zambia Governor, Denny Kalyalya, among others.

According to the Zambian Embassy in Washington first secretary for press and public relations, Patricia Littiya, several high-level meetings were expected to be held between the Zambian delegation and representatives of cooperating partners.

Ms Littiya said the meetings included one with the IMF mission team, IFC Africa Management Team and the African Development Bank (AfDB).

She said the two ministers were also expected to attend the Africa Group 1 constituency meeting at which Mr Mutati sits on board.

“Mr Mutati is expected to speak at the Spring meeting Africa forum that will discuss, among other priorities, opportunities and challenges of doing business in Africa including the political environment, economic policy, security, taxation and business regulations,” she said.

Mr Mutati was also expected to speak at a seminar on “Revealing the myths and collecting the facts on social protection in Africa” whose rational was the expansion of the social cash transfer, impact of the programme and experiences drawn from it.

Ms Littiya also said Mr Mulusa was expected to speak at the high-level panel discussion on refugee’s crisis in Africa and its impact on the economies of host countries.

The minister would also attend the 6th annual ministerial roundtable on Safety Nets for Effective and Inclusive Social Protection.

“Among matters to be discussed are how social safety nets have evolved during the last five years to be effective and inclusive, the promising policies, design features and institutional arrangements as well as the role of Public Private Partnerships,” she said.

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Barclays pledges to invest in digitalisation

By BUUMBA CHIMBULU

BARCLAYS Bank Zambia will continue to invest in digitalisation as a way of reducing the cost of doing business in the financial sector, says the bank’s new managing director Mizinga Melu.

Ms Melu, appointed recently to replace Mr Saviour Chibiya who has gone to the bank’s regional headquarters in Johannesburg, observed at her cocktail reception recently in Lusaka that digitalisation had the potential to reduce the cost of doing business.

“I am very excited about the digital agenda that the bank is driving; we have been driving under Saviour’s leadership the digital agenda and ensuring that we are talking about digitisation and technology.

“We are going to reach the common man through digitalisation, we will go there and put an ATM, it does not need to be a branch anymore,” she said.

Ms Melu explained that the bank would work with mobile operators in Zambia to ensure that the digitalisation agenda was achieved.

He said digitalisation would also assist Government collect more taxes to support economic growth.

“Government can improve collecting money from the informal sector through digitalisation and as Barclays that is our agenda.

“So I am very happy about the digital agenda and that is the part we are going to continue. Mobile banking remains our priority and how we partner with mobile companies to reach out to rural areas,” she said.

Ms Melu said she was confident that the digital agenda would be attained with support from Government that supported the financial sector which had a minister that understood how the financial sector operated.

She also said the bank under her leadership would continue to invest in key economic sectors such as agriculture, energy and mining.

Ms Melu said the bank would also continue to support women in these sectors.

“In supporting the women in Zambia we are fostering agriculture for women in growing cashew nuts and that is something we are going to continue doing to bring women perform more in this sector.

“We will continue investing in key economic sectors such as energy and ensure that Zambia exports power while ending load shedding,” she said.

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BAT ready to empower tobacco farmers

BY MAILESI BANDA

WE are working towards empowering local tobacco farmers to supply our tobacco manufacturing plant with leaf tobacco. British American Tobacco managing director, Godfrey Machanzi, has disclosed.

Mr Machanzi said the company believed in empowering small scale farmers through providing a ready market for their produce.

Speaking in an interview with the Daily Nation, he said they would engage small scale farmers in the growing of quality leaf tobacco.

He said small scale farmers’ empowerment programmes were operational in most countries where the company was operating from.

“We have empowered a number of tobacco farmers in the region and we hope to do the same with the farmers in Zambia,’’ he said.

He said the company would train farmers in good practices required to grow quality tobacco leaf. The provision of a ready local market for the produce would encourage more farmers to grow the crop.

He emphasized the need for quality tobacco, adding that the company believed in trading in quality products.

“BAT is a world class tobacco manufacturing company and we believe in quality, hence the need for farmer’s to embrace good farming practices,’’ he said.

He challenged farmers to be competitive and meet the demand for a quality product.

He observed that tobacco was one of the key crops grown in Zambia.

“Tobacco is among the key crops grown in Zambia and with the coming in of the factory we will be more than glad to provide a market for the produce,’’ he said.

He said the company planned to engage local tobacco farmers in value addition.

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Vibrant accountancy key to economic growth – expert

By BUUMBA CHIMBULU

A VIBRANT accounting profession is key in complimenting Government’s efforts of ensuring effective revenue and expenditure management, says HLB director of audit and assurance Masuzyo Muteto.

Ms Muteto said in an interview on the side-lines of the CFO wine and whiskey tasting cocktail recently that a vibrant profession would go a long way in economic development and growth.

The CFO wine and whiskey tasting cocktail was aimed at bringing accountants together to exchange ideas and knowledge on how best to grow the profession and contribute to national development.

“The economy of any country has a lot to do with policy and monitoring, so as a profession we are stakeholders in this process. For instance, we contribute in the formation, implementation, monitoring and evaluation of the national budget and our contribution as accountants.

“We are at the core of the budget of this nation and our growth and competencies as accountants are very valuable,’’ she said. She said accountants were key stakeholders in policy-making. Ms Muteto said accountants would continue to play a critical role in assisting Government in the effective management of revenue and expenditure.

She called for close collaboration among accountants.

“We should not see each other as competitors but partners in development. Our goals should be to ensure that we provide business advisory services and tax compliance, among others, to help grow businesses and the country,” she said.

Ms Muteto said her firm was also committed to promoting young talent by offering internship to students and graduates in a quest to equip them with the necessary skills and experience.