Africa Brief: Tourism in Zimbabwe battles on as arrivals stagnate and more…
Tourism in Zimbabwe battles on as arrivals stagnate
Zimbabwe’s efforts to revive the economy using proceeds from the tourism industry has failed as tourist arrivals stagnated in the first half of the year, with arrivals only increasing by 1 percent compared with the prior year. This growth was supported by the increase in arrivals from Europe, Germany and the UK. In July Zimbabwe launched an ambitious tourism policy aimed at increasing overseas arrivals in the country and boosting revenues from the industry. Walter Mzembi, the Tourism Minister, told parliamentarians yesterday that a number of initiatives had been adopted to boost the tourism industry. He said that one such initiative was to boost township tourism.
by Tawanda Karombo published in The Star, Business Report on 04/09/2014
KENYA: Stock exchange to demutualise
As part of its plans to demutualize, The Nairobi Securities Exchange (NSE) has raised 627 million Kenyan shillings (R74m) for expansion in an initial public offering (IPO) in which there was an oversubscription of 664 percent for the shares. The funds raised would be used to develop new products such as derivatives, exchange-traded funds and sharia-compliant indices, NSE chief executive Peter Mwangi said. The completion of the IPO makes the NSE the second African exchange after the JSE to be demutualised and transition to a listed company,
Excerpt from KENYA: Stock exchange to demutualise published in The Star, Business Report on 04/09/2014
Zimbabwe’s woes push millions into poverty
Many Zimbabweans do not receive a pension because the government has not decided how to convert its pensions into US dollars after abandoning the Zimbabwe dollar in 2009. Today, many Zimbabweans work into old age or rely on relatives who fled. When the government started a campaign to seize white-owned commercial farms in 2000, exports plummeted and inflation leapt to 500 billion percent in 2008. Under its indigenisation policy the government now intends to compel foreign owned mining firms and banks to cede control of their businesses.
The World Bank says 72 percent of Zimbabweans live in poverty. After the collapse of the economy job opportunities were scarce and millions of people moved to South Africa, Botswana and the UK seeking work. Zimbabweans in South Africa often enjoy advantages over local citizens because of their generally superior education. Zimbabwe’s current liquidity crunch, caused by factory closures and falling employment, threatens a second recession after five years of relative stability. Economic growth has slowed to an estimated 3.1 percent this year, compared with an average of 10 percent between 2009 and 2012, says the IMF. It has forced thousands of working-age Zimbabweans to take two or more jobs in a country where state workers earn $350 to $600 a month. The minimum wage on farms is $100 a month.
Excerpt from Zimbabwe’s woes push millions into poverty published in The Star, Business Report on 04/09/2014
ZAMBIA :VAT rule waived for mining firms
Zambia would waive a rule requiring mining firms and other exporters to produce import certificates from destination countries to claim tax refunds. Zambia’s finance minister said that the tax authorities in Africa’s second-biggest copper producer would delay the requirement as it was infeasible. The government planned to negotiate a repayment of $600 million in VAT paid by firms and withheld because of failure to produce certificates.
Excerpt from ZAMBIA :VAT rule waived for mining firms published in The Star, Business Report on 04/09/2014
Bond sales in Nigeria rise on new rules
Due to the drop in borrowing costs and before the central bank increases the amount of capital they need to hold, Nigerian lenders are preparing to sell the most debt in four years to bolster cash reserves. Banks may raise as much as $2.5bn this year compared with $2bn last year.
Nigeria’s central bank changed the way lenders calculate capital buffers to align Nigeria with global standards and increase their ability to withstand losses. The regulator ordered banks it considered too big to fail to boost minimum capital ratios to 16% last year, compared with 10.5% for South African lenders, which control most of the continent’s banking assets.
In 2010 policy makers set up the Asset Management Corp of Nigeria, which spent $35bn buying bad loans while taking over three of the eight banks it rescued. The Nigerian central bank increased cash-reserve requirements on deposits made by government ministries and agencies and state-owned companies to 75% from 50% last year. It also raised requirements on private deposits to 15% in March to reduce liquidity and support the naira. Higher spending by the government and politicians before elections in February may cause foreign outflows at the same time as banks seek to finance power, oil exploration and manufacturing projects to feed an economy forecast to expand 6% in 2014. “It is sensible for regulations to be prudent close to elections to ensure banks remain sound,” Jefferies International’s head of international credit strategy in London, Richard Segal, said.
by Emele Onu published in Business Day on 04/09/2014
Imperial sets its sights on African cars
Imperial Holdings is expanding its motor vehicle business into Africa as part of a strategy to reduce the impact of volatility of the rand and cyclically of the South African new vehicle market on the weak financial performance of the group.
by Roy Cokayne published in The Star, Business Report on 03/09/2014
There is much Africa needs to do to grow and diversify its economy…
Investor enthusiasm for Africa is gaining traction. The continent offers growth and the opportunity of lucrative return on investment. In the past, Africa’s economic growth was primarily driven through extractive enterprises, however recently there has been success from manufacturing, agriculture and natural resources. Africa is poised to outgrow its reputation as a market driven only by consumption and commodities.
by Jeff Nemeth published in The Star, Business Report on 03/09/2014
ZAMBIA : VAT refunds on exports easier
Zambia had amended rules that prevented exporters from First Quantum Minerals to Vedanta Resources claiming refunds on VAT payments, the Zambia Revenue Authority said yesterday. A rule requiring exporters to supply import documents from the country of destination to get refunds would be removed. The amendments were received with a lot of relief from those affect.
by Bloomberg published in The Star, Business Report on 03/09/2014
GHANA : Fidelity Bank to double outlets
Fidelity Bank planned to double its branch network within three years after it received a cash injection from backers including Edmond de Rothschild Investment Partners and Kagiso Tiso Holdings. Fidelity bank, which currently has 51 branches, planned to boost that number to 100 by 2017.
by Bloomberg published in The Star, Business Report on 03/09/2014
R252m scholarship project to reverse Africa’s brain drain
A multi-million rand project that aims to develop 800 “committed future leaders”, drawn from economically disadvantaged communities across sub-Saharan Africa, is being launched by the University of Cape Town (UCT). This initiative, which will start in 2015 as part of the MasterCard Foundation Scholars Programme, will help reverse the effects of the brain drain on the continent. The foundation has committed $23.5m (R252m) over the next 10 years to finance the project.
Excerpt from R252m scholarship project to reverse Africa’s brain drain published in The New Age on 03/09/2014