telecom firms agree to share infrastructure

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By Tawanda Musarurwa HARARE – Zimbabwe’s tel- ecommunications companies have agreed to infrastructure sharing policy, Information Communication Technology, Postal and Courier Services Minister Supa Mandiwanzira has said. Sharing mobile infrastructure is an alternative that lowers the cost of network deploy- ment. In an interview, the ICT minister said telecoms operators had met an earlier 90-day ultimatum to sign an agreement on infrastructure sharing. He added that regulations that will govern the infra- structure sharing had already been drafted and are set for promulgation. “The 90-day ultimatum was met. We have a document that has been submitted by POTRAZ after consultation News Update as @ 1530 hours, Thursday 10 March 2016 Feedback: [email protected] Email: [email protected] Telecoms firms agree to infrastructure sharing

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By Tawanda Musarurwa

HARARE – Zimbabwe’s tel-ecommunications companies have agreed to infrastructure sharing policy, Information Communication Technology, Postal and Courier Services Minister Supa Mandiwanzira has said.

Sharing mobile infrastructure is an alternative that lowers the cost of network deploy-ment. In an interview, the ICT minister said telecoms operators had met an earlier 90-day ultimatum to sign an agreement on infrastructure sharing.

He added that regulations that will govern the infra-structure sharing had already

been drafted and are set for promulgation.

“The 90-day ultimatum was met. We have a document

that has been submitted by POTRAZ after consultation

News Update as @ 1530 hours, Thursday 10 March 2016

Feedback: [email protected]: [email protected]

Telecoms firms agree to infrastructure sharing

with all the players in the industry, a draft regulation that needs now to be gazet-ted is now there.

“We are now tabling them at the attorney-general’s office to ensure that those regula-tions are in line with the Act and that they are within the confines of our constitution. Once that process is done, we will gazette them and they will become law,” said Minister Mandiwanzira.

Infrastructure sharing can take several forms depend-ing on existing licences and the regulatory framework in place.

Broadly, infrastructure sharing can be based on the passive elements of a telecommunications network, which is often referred to as ‘passive infrastructure shar-ing’ or can be based on the active elements.

Minister Mandiwanzira said the successful implementa-tion of infrastructure sharing

will preclude the need to regulate the pricing of data.

Many telecoms services customers have complained that local data charges are too high, compared to the region, for instance.

“I don’t think we need a pol-icy that regulates the pricing of data, what we need is to encourage things that we are already working on like infra-structure sharing.

“Because when we have infrastructure sharing we won’t have the costs that networks are incurring by each building its own infra-structure. For instance if you

look between Harare and Bulawayo we have three fibre cables when one only one will be able to serve every-one.

“Now that means the invest-ment which has gone into the two additional fibre cables is being paid for by the con-sumer and when you go to these operators and say you can’t charge this much they say we need to cover the costs of the infrastructure,” he said.

The minister said the prob-lem with regulation is that it creates ‘secondary’ and ‘black’ markets, which is not ideal.●

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BH24 Reporter

HARARE -Listed conglomer-ate Innscor Africa Holdings’ revenue for the half-year to December 31, 2015 rose to $300,6 million up from $295,7 in the prior compara-ble period.

The group’s results showed significant growth in volumes driven by reduction in price to the customer, resulted in improved capacity util isation and improved efficiencies.

Operating profit from con-tinuing operations increased 8 percent to $27,4 million

as operating expenses were tightly managed resulting in a decrease in costs compared to prior year.

And profit before tax was up by 18 percent to $20,6 million while profit after tax was up 23 percent to $15,8 million.

Subsidiary National Foods’ revenue for the period was up 2 percent to $170,9 million on the back of good volume performance, which rose 12,6 percent to 291,700 tonnes.

According to management,

the increase in volume was due to strong performances in the maize and flour divi-sions. It said the discrepancy between volume growth of 12,6 percent and revenue growth 2 percent was result of management’s strategy to lower average selling prices and grow share in an increasingly competitive market.

Gross margins increased marginally due to changes in the product mix and improved operating efficien-cies in the firm’s plants. Total operating costs grew by

11,2 percent, profit before tax was also steady up 1 percent to $8,86 million.

Meat processor Colcom reported a 9 percent decline in revenue for the period under review, going down to $30,5 million down from $33,7 million prior year com-parative.

Colcom’s profit for the period was flat at $2,84 million.

Innscor declared interim dividend of 0,30 cents per share.●

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Innscor posts improved HY results

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Harare– The Zimbabwe Asset Management Company (ZAMCO), Government’s spe-cial purpose vehicle for debt takeover, has acquired $371 million worth of Non-Per-forming Loans (NPLs) from banks, a Cabinet Minister has said.

ZAMCO, established last year, uses a number of ways to fund acquisition of NPLs, including government Treasury Bills and loans from foreign funders.

Prior to the establishment of ZAMCO, the Reserve Bank of Zimbabwe (RBZ) had noted with concern that NPLs, which reached 18 percent in September 2014, had caused banks to scale down on new loans especially to productive sectors of the economy.

This had the potential of constraining economic turn-around efforts. Finance and

Economic Development Min-ister Patrick Chinamasa said failure to pay back loans was one of the biggest chal-lenges affecting the econ-omy. He said the ZAMCO initiative was paying off, and this would in the long run increase banks’ “appetite” to on lend.

“I am informed that some-

thing like $371 million col-lateralised debt has already been taken over,” he said.

By end of December last year the ratio of NPLs had declined to 10, 87 percent largely due to loan disposal. The value of secured NPLs in the banking sector is esti-mated at about $500 million

Minister Chinamasa said the RBZ was engaging local financial institutions to reduce the cost of credit. Meanwhile, the Minister said the financial services sector remained safe and sound despite cash shortages expe-rienced last week.

He said the cash shortages had been brought under control. He also said the impending exit of Barclays Bank from African opera-tions, including Zimbabwe, would not affect the local market.

“The financial sector is in a very good position not-with-standing that Barclays has said that it is exiting Africa. Its closure will not have an adverse impact on the finan-cial services sector,” he said.

Minister Chinamasa added: “It had long since been apparent to me that Barclays was on an exit strategy out of Zimbabwe, I mentioned this to them, but of course they denied it, when I was appointed Minister of Finance in 2013.”

“The information I used was basically their lend-ing portfolio, at their peak they used to run credit lines of $800 million and when I spoke to them and said they were on an exit strategy it had been run down to $40 million, from $800 million to $40 million so I was not surprised when the decision was made.” he said.- New Ziana●

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NPL’s worth $370 million acquired

Minister Chinamasa

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HARARE – Judges of the Common Market for Eastern and Southern Africa Court of Justice have completed a training programme aimed at deepening their under-standing of regional integra-tion and dispute settlement as they adjudicate on trade and investment issues in the region

Sponsored by the Trade Law Centre, a non-profit making capacity building organisa-tion, the eight months old Bench went through inten-sive two-day training in international trade law and policy and dispute resolution within regional economic communities.

As Judge President of the Court Lombe Chibesakunda observed during the open-ing of the training South Africa this week, COMESA Court judges are appointed from different judicial back-grounds to find themselves thrust into the realm of

regional and international trade law and policy.

“While this is not to say that we have not, in one way or another encountered dis-putes that would fall into this realm, the fact is that, as Judges of a regional Court, we must not only understand the environment in which we are dispensing justice, but must also equip ourselves with the necessary knowl-edge and skills,” said the Judge President.

She said it is extremely

important for the judges to gain a sound understanding of regional integration and dispute settlement.

Judge President Chibe-sakunda said the training will have significant impact on the quality and relevance of jurisprudence that will ema-nate from the Court.

She expressed gratitude to the TRALAC team for the generous contribution it was making towards capacity building in regional inte-gration especially to the

COMESA Court judges and these include;

“The rights granted under the free movement of goods, services and people policies and how the Court inter-prets the COMESA Treaty and or decisions, directives of Council of Ministers or the Authority (of Heads of State) when there is an allegation of breach. This is in addition to what the Tripartite Free Trade Area entails and how this will impact the work of the Court.”

The training was conducted by TRALAC team led by Executive Director, Ms Trudi Hartzenberg and Professor Gerhard Erasmus.

The COMESA Court of Jus-tice is the judicial organ of COMESA whose core func-tion is to adjudicate upon all disputes between Member States that would arise from the interpretation and appli-cation of the COMESA Treaty. New Ziana●

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COMESA completes training programme for judges

HARARE - The Industrial index gained a further 0.10 points to end the day at 99.07 points.

Gains were in Padenga which added $0,0020 to trade at $0,0600, Simbisa was $0,0012 higher at $0,1295 and Econet was up $0,0008 to close at $0,2308. OLD MUTUAL inched up $0,0050 to $1,8150.

Cement maker PPC was the only counter to trade in the negative territory after shedding $0,0025 to settle at $0,7675.

The Mining index was flat at 19.14 points. Bindura, Falgold, Hwange and Rio

Zim maintained previous price levels at $0,0095, $0,0050, $0,0300 and

$0,1040 respectively- BH24 Reporter ●

ZsE11

Equities in further gains

MovERs CHANGE TOdAY PrICE USC sHAKERs CHANGE TOdAY PrICE USC

Padenga 3,44 6,00 PORTLAND CEMENT 76,75 -0,32

SIMBISA 0,93 12,95

ECONET 0,34 23,08

OLD MUTUAL 0,27 181,50

INdEx PREvIoUs TOdAY MovE CHANGE

INDUSTRIAL 98.97 99.07 +0.10 points +0.11%

MINING 19.14 19.14 +0.00 POINTS +0.00%

12 ZsE TABlEs

ZsE

INdICEs

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13 dIArY OF EVENTS

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

PowER GENERATIoN sTATs

Gen Station

10 March 2016

Energy

(Megawatts)

Hwange 502 MW

Kariba 443 MW

Harare 30 MW

Munyati 17 MW

Bulawayo 18 MW

Imports 0 - 400 MW

Total 1286 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...

•TSL, Head office, 28 Simon Mazorodze road, Southerton, 16 March, 1200hrs

• Old Mutual Zimbabwe, Steward room, Meikles Hotel, March 30, 1430hrs

THE BH24 dIArY

JoHANNEsBURG -RATING agency Standard & Poor’s (S&P) downgraded Bar-clays Africa’s credit rating on Wednesday to a level below that of its rivals, after reviewing the bank’s stra-tegic importance to British parent, Barclays.

The cut to sub-investment grade follows the British bank’s announcement that it would sell down its 62,3 per-cent stake in the group due to strict regulatory require-ments that affected Barclays Africa’s ultimate returns to the group.

It plans to do this over the next two to three years. S&P’s decision follows similar action by rival agency Fitch Ratings earlier this week. The ratings agency down-graded the group’s foreign and local currency ratings to one level above sub-in-vestment grade for the same reason.

Barclays Africa now has an S&P national scale long-term rating of zaA, which is in the same bucket as BB+, a

sub-investment grade rating on S&P’s ratings map.

The rating falls below those of rivals Nedbank and Fir-stRand, which both hold ratings one notch higher at zaAA-.

Standard Bank does not

publish its national scale ratings.

But Barclays Africa said the changes in ratings brought the group in line with the other major banks. "Absa is rated zaAA-in line with all the other peer banks in SA," said Carli Cooke, acting

spokeswoman for the bank-ing group.

S&P said its ratings on the banking group no longer incorporated support from Barclays. They were also no longer equal to those of Absa, its core operating subsidiary.

The agency affirmed Absa’s ratings one notch higher, which is stil l investment grade.

"The rating on Absa does not include any uplift for exter-nal support, and is based on our BBB-group credit profile assessment for the Barclays Africa group," S&P primary analyst Samira Mensah said.

S&P believes Absa, which is regulated by the South African Reserve Bank, would receive more protection from the central bank than Bar-clays Africa.

"The (Reserve Bank) has the ability to halt Absa’s divi-dend payments to Barclays Africa to protect the bank’s depositors," Ms Mensah said.-BdLive●

REGIoNAl NEws 14

S&P opts to cut Barclays Africa credit rating

Mr Michael Horn, leader of the Volkswagen brand in the US, abruptly left the auto-maker as its American sales continue to fall following an emissions-test cheating scandal.

The decision was mutual and Horn, 54, will be replaced for now by executive Hinrich Woebcken, the company said in a statement.

Mr Horn became the brand’s US CEO in January 2014 and improved dealer relations so much that when the years of cheating came to light in September 2015, independ-ent retailers lobbied for him to remain on the job and said his removal would be “catastrophic.”

He had been a public face for the brand, apologising repeatedly at auto shows and other events, and his depar-ture caught analysts and key dealers off-guard. Apologies aside, US sales have fallen for four straight months and the Wolfsburg, Germa-ny-based company has been unable to reach an agree-ment with US and California

regulators.

“People know this scandal was rooted in Germany, which is why this is so sur-prising,” said Rebecca Lind-land, senior analyst for auto researcher Kelley Blue Book. “In terms of scapegoats, there are other goats out there who would have been better” to take the fall.

In October, Mr Horn told

Congress the cheating was the work of a few employees and not known by top exec-utives in Germany -- though acknowledging at the time: “I agree it ’s hard to believe.”

Two weeks later, Manager Magazine reported that for-mer chief executive Martin Winterkorn and other senior leaders knew of the manip-ulation early on. The unre-solved issues with US and

California regulators include how to fix some 600 000 cars on the road in the US and ways to address environmen-tal damage as they spew as much as 40 times the allowa-ble amount of smog-forming nitrogen oxide.

The VW brand’s monthly declines since the scandal include a 13 percent drop in February that was larger than analysts had estimated. Before the admission that its diesel-powered cars included a so-called defeat device that controlled emissions only during tests, those models made up about 20 percent of VW sales in the US In January, Horn said that only a relatively small number of US drivers wanted to trade in their over-pollut-ing cars.

“What could he have done, besides give cars away?” said Maryann Keller, an independent auto industry consultant in Stamford, Con-necticut. “This is not fixable by any one person in the United States. This has to be fixed by someone in Germa-ny.”-Reuters●

INTERNATIoNAl NEws 15

Volkswagen's US CEO exits group in a huff

Mr Michael Horn

By david Fickling

IT IS the best of times in commodities markets, it is the worst of times in commodities markets as dramatic swings abound.

Iron ore posted its biggest gains on record on Mon-day, while Brent crude broke through $40 a barrel for the first time in three months. Then Chinese data on Tuesday showed dollar-denominated exports falling 25 percent, the worst decline since May 2009.

What is going on?

There are reasons to take both sets of data with a pinch of salt. Market prices are prone to speculation, momentum trading and short squeezes.

Economic indicators can also be tricky. How much of China’s export collapse last month had to do with the timing of Lunar New Year?

Five indicators are worth watching for a clearer picture on where commodities are

headed.

The Baltic Dry index is invalu-able to understand the state of real commodities demand. The benchmark for rates to charter the ships that carry iron ore, coal and grain is at depressed levels, thanks to a global glut of cargo capacity. As it tracks real prices being paid to book ships, there is no speculative element. If real demand starts to pick up, the Baltic Dry is one of the first places it shows up.

Cement prices are a good indi-cator of construction activity. One of the reasons cited for iron ore’s surge on Monday was news that China’s legisla-ture was prepared to accept a larger budget deficit to keep

the economy humming.

The post-2008 building boom showed that China’s leaders were prepared to use con-struction as a tool of economic management in much the same way as western central banks use debt markets. If Chinese leaders say the economy is looking weak, pile into con-struction materials.

Chinese electricity production figures are seen by Premier Li Keqiang as more reliable than gross domestic product. The numbers are timely, and hard to fake as a guide to real eco-nomic activity.

Chinese refinery-utilisation rates are a useful cross-ref-

erence for real oil demand as oil import data are muddied by fuel flowing into strategic stockpiles.

The thermal coal contract prices that Japanese utilities strike with Australian coal pro-ducers in early April remain an important benchmark because they are pretty much quaran-tined from speculative activ-ity, giving a clue to where the big players see coal markets heading.

It is always worth checking speculative moves against more fundamental indicators. After all, markets managed to predict nine out of the past five commodity booms.-Bloomb-erg●

16 analysis16 ANALYSIS

Fundamental figures illuminate muddy commodity markets