By Funny Hudzerema

HARARE –Industry represent-ative body, the Confederation of Zimbabwe Industries (CZI) has urged Government to introduce Local Content Regu-lation (LCR) for all the sectors of the economy in order to boost the production.

The LCR will ensure that some goods and services are provided by local producers, ahead of any imports. The regulation also mandates prescribed entities (manufac-turers) to include a minimum local content of inputs in their production.

CZI economist Mr Kupakwashe Midzi said the regulation will increase competitiveness of

News Update as @ 1530 hours, Wednesday 08 June 2016

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CZI calls for local content quota legislation

the country through promot-ing local products first before opting for imports.

“Government should intro-duce LCR to all sectors of the country like other countries which are benefiting from the regulation. The LCR should promote employment of locals by foreign firms by ensuring certain jobs are done by locals if skills are available and promote local procurement to support local businesses with demand,” he said.

He added that the regulation should target sectors such as the mining, parastatals, manufacturing, retail, energy, transport, motor trade and assembly, construction, ser-vices, health and tourism.

“The Act should cover that where capabilities are low or are not available then the affected procuring entities should participate in “sup-plier development programs” where they assist suppliers to develop capabilities through

information sharing and other support such as off-take agreements when suppliers need to seek funding.

“Compliance by the arms of Government will be through the tender processes where tender documents should state minimum content thresholds to be achieved to qualify for supply. SAZ can be used to audit compliance by arms of government in the same way it is done in South Africa by SABS,” he said.

He added that specific thresh-olds levels would need to be set for the various subsectors such as mining among others to enforce private sector min-imum local content thresholds compliance.

“SAZ can be used to audit compliance by arms of gov-ernment in the same way it is done in South Africa by SABS.

“The retail sector could be mandated to stock at least 50 percent of local products on shelves and this should apply to all types of retail food, grocery, furniture, hardware, electrical, clothing, motor spares, cosmetics and fast food among others,” he said.

Countries like Nigeria have limited the purchase of imported goods per volume or value of imported goods as part of its LCR while Brazil, Zambia, Ghana, Mozambique and Nigeria require investors to give preference to local suppliers.●

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HARARE - Caledonia Min-ing Corporation, the parent company of Gwanda based Blanket Mine, says it does not envisage entering into further hedge agreements, following the recovery of gold prices on international markets.

A hedge is a trading strategy designed to reduce the risk of adverse price movements in an asset.

In February this year, Cale-donia announced a six month hedge arrangement with a financial counter-party for 15 000 ounces of gold.

The arrangement, which set Caledonia’s gold at between $1 050 and $1 080 per ounce, would give the miner greater clarity over cash-flows until July 2016 when production at Blanket mine was expected to increase.

“This small hedge was unu-sual for Caledonia, which is traditionally unhedged, but was a prudent measure as

an insurance against volatil-ity during this critical year of capital expenditure and with a desire not to have to try and fund any of the expansion externally,” Caledonia said in a statement.

“With the gold price recov-

ery since the beginning of 2016 we do not anticipate that Caledonia will return to any further hedging activities and will not require external funding.”

Caledonia is currently imple-menting a six-year invest-

ment programme under which it intends to invest $70 million from 2015 to 2021 to increase production to approximately 80 000 ounces of gold annually by 2021.

Caledonia said it was debt free and would continue paying dividends and impor-tantly was able to fund any cost overruns on its expansion plan.

“Production will double from the current +40 000 ounces per annum to 80 000 ounces annually becoming a producer of scale. By the end of the year we expect Caledonia’s cash position to improve measurably and see strong (and increasing) cash genera-tion as the new Central Shaft is completed,” the company said.

Caledonia, a Canadian firm, owns 49 percent of Blanket mine, with the remainder held by locals.

- New Ziana●

Caledonia not keen on furthering hedge agreement

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BH24 Reporter

HARARE – Zimbabwe has to date earned $253,6 million from the exports of 45,1 million kilogrammes of its Virginia tobacco product since the beginning of the year, latest figures from the Tobacco Industry and Market-ing Board (TIMB) show.

Tobacco is one of Zimbabwe’s key export products along-side minerals such as gold, platinum and diamonds. The 45,1 million kg were sold at an average price of $5,62 per kg sold so far, which is

an improvement (in terms of mass) from the 42, 3 million kilogrammes at an average price of $5,82 per kg exported over the same

period in 2015.

China continues to be the biggest purchaser of Zimba-bwean tobacco. The coun-try has so far imported 20 million kg of tobacco at an average price of $8,11 per kg worth $164 million.

South Africa is the second largest buyer and has so far bought 9 million kgs worth $26 million, at an average price of $2,90 per kg.

Indonesia is in third hav-ing imported 2,2 million kg of locally-produced Virginia

tobacco worth $11 million at an average price of $5,21 per kg. As at the end of last year, Zimbabwe had accrued over $700 million in export receipts from its tobacco alone.

Meanwhile, in respect of the upcoming planting season TIMB has said a total of 80 272 growers have regis-tered while 10 015 are new growers. Tobacco has become one of the country’s major foreign currency earners, with close to 92 000 farmers having grown the crop in the last season. ●

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Virginia tobacco exports gross $253m

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HARARE - The Postal and Telecommunications Regula-tory Authority of Zimbabwe (POTRAZ) on Tuesday denied allegations of favouratism leveled against it by Econet Wireless.

Econet Zimbabwe chief executive Douglas Mboweni recently said POTRAZ had created an “uneven playing field” in the mobile phone sector by allegedly exempt-ing one player from paying licence renewal fees.

But POTRAZ said in a press statement, that no telecom-

munication operator had been exempted from paying licence renewal fees, insist-ing this was a matter of due process.

“That the quantum of licence

fees is a matter of law and public knowledge given that they are expressly laid out in the licensing regulations. Members of the public should therefore not be misguided

by the false statements that have appeared in the print media on different occa-sions,” POTRAZ said.

The telecoms regulatory authority said two mobile operators were using licences that were yet to expire, and therefore did not have to pay licence renewal licences. In Janu-ary, Econet also sued the regulator for $132 million citing losses incurred owing to a mandatory reduction in tariff charges in 2014.-New Ziana●

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POTRAZ slams media reports of unfair practices

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HARARE - The equities mar-ket added to previous loses with a further 0.47 drop for the mainstream industrial index to settle at 102.86.

Beverages giant Delta led the losers after it eased $0,0100 to close at $0, 6700, while SeedCo lost $0,0032 to $0,5500 and conglomerate

Innscor dropped $0,0025 to trade at $0,2000.

Trading in the black was Afdis which added $0,0122 to $0,4500 and giant insurer Old Mutual which was up $0,0088 to settle at $2,2513 while Hippo inched up $0,0005 to trade at $0,2005.

The mining index was flat at 26.24 as Bindura, Falgold, Hwange and RioZim were unchanged on previous price levels at $0,0120, $0,0050, $0,0300 and $0,1700, respectively

BH24 Reporter ●

Equities negative run continues

12 ZsE

MOVERs CHANGE TOdAy PRICE UsC sHAKERs CHANGE TOdAy PRICE UsC

AFDIS 2.78 45.00 DELTA -1.47 67.00

OLD MuTuAL 0.39 225.13 INNSCOR -1.23 20.00

Hippo Valley 0.25 20.05 SEEDCO -0.57 55.00

INdEx PREVIOUs TOdAy MOVE CHANGE

INDuSTRIAL 103.33 102.86 -0.47 points -0.45%

MINING 26.24 26.24 +0.00 POINTS +0.00%

13 ZsE TABlEs

ZsE

INdICEs

stock Exchange

Previous

today

14 dIARy OF EVENTs

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

POWER GENERATION sTATs

Gen Station

08 June 2016

Energy

(Megawatts)

Hwange 575 MW

Kariba 546 MW

Harare 20 MW

Munyati 19 MW

Bulawayo 24 MW

Imports 0 - 400 MW

Total 1560 MW

9 JUNE -- First Mutual Holdings Annual General Meeting; Place: Royal Harare Golf Club, Harare; Time: 14:30hrs

15 JUNE 2016 -- Rainbow Tourism Group 7th Annual General Meeting; Time: Jacaranda Rooms 2 and 3 at the Rainbow Tour-ism Hotel and Conference Centre, 1 Pennefather Avenue, samora Machel Avenue West, Harare; Time: 1200 hours...

16 JUNE 2016 -- RioZim 60th Annual General Meeting; Place: No. 1 Kenilworth Road, Highlands, Harare; Time: 10.30 hours...

22 JUNE 2016 -- Zimre Holdings limited 18th Annual General Meeting; Place: NICOZdIAMONd Auditorium, 7th Floor Insur-ance Centre, 30 samora Machel Avenue, Harare; Time: 1430 hours...

22 JUNE 2016 -- GB Holdings limited Annual General Meeting; Place: Cernol Chemicals Boardroom, 111 dagenham Road, Wil-lowvale, Harare; Time: 11.30 hours...

23 JUNE 2016 -- Zimpapers 89th Annual General Meeting; Place: Zimpapers ltd Boardroom, sixth Floor Herald House, Cnr. G. silundika/sam Nujoma street, Harare; Time: 1200hrs…

THE BH24 dIARy

JOHANNEsBURG - The rand pulled back from the pre-vious session's four-week highs against the dollar on Wednesday and traders said South African GDP data expected to show a small contraction in the first quar-ter could add pressure on the currency.

The rand has gained as much as 5 percent against the dollar since Friday, reach-ing 14,7995 on Tuesday in a relief rally prompted by S&P's decision to maintain South Africa's investment grade BBB- rating.

The currency however gave back some of those gains on Wednesday to trade at

14,9175/dollar by 0650 GMT, down 0,1 percent from the previous session's close.

Traders saw a risk to the currency from Statistics South Africa's GDP data due out at 0930 GMT, with economists polled by Reuters expecting the economy to have shrunk 0,1 percent on a quarter-on-quarter annu-alised basis in the first three months of the year.

"If this is indeed the case there is not much chance the rand will be able to continue its journey lower (firmer)," Standard Bank trader War-rick Butler said in a note to clients.

Another rand-moving head-line could be a review from Fitch, which is also expected to retain its own BBB- rating on Africa's most industrial-ised economy, although it could change the outlook to negative from stable.

Fitch has not set a date for its announcement, but the Treasury has said it expects it on June 8. - Reuters●

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NUM union to decide whether to return to work at Northam

Rand halts rally, GdP data, Fitch review keep market wary

REGIONAl NEWs

JOHANNEsBURG -Members of South Africa's National union of Mineworkers (NuM) will decide on Wednesday if they will return to work at Northam Platinum's Zon-dereinde mine, which was shut on Monday after violent clashes between NuM and a rival union.

Northam made the initial decision to close opera-tions at the mine but on Tuesday asked the workers to return, saying calm had been restored. But NuM, the majority union at the mine, and arch rival the Associa-tion of Mineworkers and Con-struction union (AMCu) have both said their members will not go back until they feel it is safe to do so.

NuM spokesman Livhuwani Mammburu said the union's members would hold a mass meeting at midday to decide if they would go back under-ground.

"It is up to the members to decide," he said.

AMCu officials could not

immediately be reached for comment. A Northam spokeswoman confirmed the mine remained closed for a third day. Monday's flare-up was sparked by the mur-der of an NuM member and Northam employee on Sun-day. Another miner, whom AMCu said was affil iated to it, was fatally stabbed in Monday's scuffle.

NuM says that Sunday's kill-ing brings to six the number of its members who have been murdered, including five last year. The clashes have heightened concern over a potential repeat of periodic outbreaks of union violence that have resulted in deaths and operational stoppages across the sector.

The Zondereinde mine pro-duces about 300 000 ounces of platinum a year, according to Northam's website, and accounts for about 70 per-cent of the mid-tier produc-er's revenue

- Reuters●

Oil traded near the high-est close in more than 10 months as weekly uS industry data showed crude stockpiles declined, trimming a glut.

Bottom of Form

Futures were little changed in New York after advancing 3,6 percent the previous two sessions to close above $50 a barrel Tuesday for the first time since July. Inventories fell by 3,57 million barrels last week, the American Petroleum Institute was said to report. Government data Wednesday are forecast to show supplies dropped. Repair work on a key Nige-rian oil pipeline operated by Royal Dutch Shell Plc is underway, according to a person familiar with the operations.

Oil has surged more than 90 percent from a 12-year low in February amid unplanned disruptions and a steady slide in uS output, which is under pressure from the Organisation of Petroleum Exporting Countries’ policy of pumping without limits.

uS gasoline consumption is set to climb to a record this summer as the lowest retail prices in more than a decade encourage people to take to the roads, according to gov-ernment data.

“The risk for prices remains on the upside as new highs attract more buyers who don’t want to miss the train,”

Michael Poulsen, an analyst at Global Risk Management Ltd., said by e-mail. “Con-tinued supply disruptions in Nigeria as well as a draw in uS crude inventories are supporting the market.”

West Texas Intermediate for July delivery was at $50,57 a barrel on the New York Mercantile Exchange, up 21

cents, at 9:40 a.m. London time. The contract gained 67 cents, or 1,4 percent, to $50,36 on Tuesday. Total volume traded was about 39 percent below the 100-day average.

Us stockpiles

Brent for August settle-ment was 27 cents higher at $51,71 a barrel on the London-based ICE Futures Europe exchange. The con-tract rose 89 cents, or 1,8 percent, to $51,44 on Tues-day. The global benchmark traded at a premium of 56 cents to WTI for August.

Crude supplies at Cushing, Oklahoma, the delivery point for WTI and the biggest uS oil-storage hub, fell by 1,31 million barrels last week, the API said Tuesday, according to people familiar with the figures. Nationwide invento-ries slid by 3 million barrels, according to the median esti-mate in a Bloomberg survey before an Energy Informa-tion Administration report Wednesday. - Bloomberg●

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Oil trades near 10-month high as falling Us supplies trim glut

INTERNATIONAl NEWs

By Olusegun Obasanjo

Every year, thousands of young Africans join an exodus from their families’ small, often struggling, farms in the coun-tryside.

Their dream — sometimes fulfilled, often not — is to find a more rewarding and stimulating life in the continent’s rapidly growing cities. Few return, but even fewer ever completely sever their ties.

It’s a complicated connection and one I deeply understand. My own exodus to the city as a young man opened up a lifetime of opportunity that culminated with serving as president of Nigeria, Africa’s largest econ-omy.

But not only did I retain my ties to agriculture, I have now returned to my roots. I’m a farmer again — at Obasanjo Farms Limited — and I’ve never been happier. Working the land once more has given me a better perspective on two of the biggest challenges facing Africa

today: how do we provide employment opportunities to the millions of young Africans, who are the world’s largest

population of people under 25 years of age so they can stay in the village and farm? And how do we put an end to the seem-

ingly endless cycles of food crises that are, as I write, play-ing out again with dismaying familiarity in parts of eastern

17 analysis17 ANAlysIs

Africa needs best and brightest to embrace agriculture as a career

18 analysis18 ANAlysIs

and southern Africa?

Fortunately, more and more Africans like myself are seeing these issues as intertwined. We see agribusiness as Africa’s biggest opportunity to not only end hunger and malnutrition, but also as Africa’s best hope for generating income and employment, particularly in rural regions.

The World Bank estimates that by 2030, demand for food in our rapidly growing urban areas will create a market for food products worth $1 trillion.

This market needs to be owned and operated by African farmers, African agriculture businesses and African food companies.

But one thing is clear to me as I return to farming: to achieve its potential, African agriculture needs a fresh infusion of inno-vation and talent. I have many fond memories of my childhood in a small farming settlement near Abeokuta, the capital of Nigeria´s Ogun State.

By the age of five, I was accompanying my papa to the fields where we grew cassava, maize, plantain, oil palm and other crops. A proud Yoruba man, my father was considered the most successful farmer in our village. While living with few modern amenities, we grew plenty of food, and we enjoyed the cultural wealth of our Yoruba traditions and history.

ultimately, this way of life was unable to withstand pressures that would soon intensify — population growth, political turmoil, land scarcity and soil degradation. Today, African farmers need several things that my father lacked but which farmers elsewhere in the world take for granted.

We need improved crop varie-ties developed to resist disease and tolerate drought. We need access to modern inputs, like fertilisers.

We need markets where farm-ers can profit from their labour and thus justify investments in

improved production. We need affordable credit that all small businesses require and exten-sion services that help us keep abreast of sustainable farming practices.

But ultimately we need people. Specifically, we need Africa’s best and brightest to embrace agriculture as a calling and a career. Recently, I agreed to chair the selection committee for the new Africa Food Prize, an award that aims to recognise outstanding individuals or insti-tutions taking control of Africa’s agriculture agenda. It started out in 2005 as the Yara Prize.

But moving it to Africa in 2016 and rechristening it the Africa Food Prize has given the award a distinctive African home, African identity and African ownership. It is also a substan-tial award: $100 000 for the winner.

The hope is that the prize itself and its cadre of winners will signal to the world that agricul-ture is a priority for Africa that

all should embrace. It can call attention to the individuals who are inspiring and driving inno-vations that can be replicated across the continent.

I sometimes portray my return to farming as coming full circle. But in reality, while I cherish my childhood memories, I don’t want to return to the past.

I want to be part of the future, where farming in Africa is a lucrative, exciting entrepre-neurial pursuit and young people aspire to be farmers because they see talented men and women building a rewarding career in farming and farm-related work.

I hope that the Africa Food Prize quickly becomes a symbol of all that agriculture in Africa can offer and that one day soon, we will see a shift, when young people in urban areas will look longingly to country-side and think: there lies the land of opportunity. – Bdlive●

*Obasanjo is a former presi-dent of Nigeria