Zimbabwean Business Community invited to Expo Milan 2015

Zimbabwe will be participating at the World Exposition in Milan, Italy that opened from 1 May and will run until 31 October 2015 under the theme “Feeding the Planet, Energy for Life”. Participating countries have derived their national themes and Zimbabwe is participating under the theme ” Food Security, Sustainable Development: a Healthy Zimbabwe”.

As part of the Expo Milan 2015 programme of events, participating countries are allocated a National Day to celebrate exceptional events that include shows, cultural activities as well as business conferences. Zimbabwe will host her National Day on the 31st of August where a number of activities will be carried out including a Trade and Investment Conference where the country will showcase various business opportunities. The accession will be graced by the highest authority in the country with a number of dignitaries and Italian business Chambers invited. This would be a great opportunity for business networking with various people from across the globe.

The Cremona Chamber of Commerce in Italy has also offered to host the entrepreneurial and institutional delegation in Cremona in an effort to better understand the mutual interests and creating opportunities between the two countries.

It is with this background that the Zimbabwe Chamber of Commerce extends the invitation from the Ministry of Industry and Commerce to its stakeholders to attend the Trade and Investment Conference to be held on the Zimbabwe National Day in Milan, Italy. A detailed program will be availed in due course.

Swaziland International Trade Fair 2015

All SMEs affiliated to Zimbabwe National Chamber of Commerce are invited to participate at the Swaziland International Trade Fair (SITF), to be held at Mavuso Trade and Exhibition Centre in Manzini, from the 28th August- 7 September 2015.

SITF brings together manufacturers, suppliers and service provider from Swaziland and across the globe to showcase in one integrated event and in the process meet with buyers from over 15 regional and international countries.

The number of visitors threat come at the SITF is approximately 20,000 to 30,000 and it is conventionally official opened by His Majesty, King Mswati III and the official closing ceremony is officiated by Head of Government, Honourable Prime Minister Dr Sibusiso Barnabas Dlamini. 2015 SITF will provide diverse components of programs that will make the event beneficial to both businesses to both business people and consumers. Programs include; business seminars that bring together eminent thinkers in different sectors to discuss key topical business issues and business matching platform that seeks to link exhibitors with targeted buyers.

More information on SITF including registration forms can be obtained from SITF website www.sitf.co.sz or contact +268 7802 3487/7811 0244/5/7.

ZNCC Women in Enterprise Conference and Awards (WECA) enters third year

The Women in Enterprise Conference and Awards is set to spread its tentacles for the third time in September at Rainbow Towers Hotel, Harare. The ZNCC Women’s Desk in association with Women Alliance of Business Associations in Zimbabwe (WABAZ) hosted its inaugural Women in Enterprise Conference and Awards (WECA) in November 2013 and since then, the platform has grown from strength to strength.

The Women’s Desk chaired by Divine Ndhlukula ZNCC Deputy President, was formed after the Chamber had realised that women’s economic empowerment is an effective tool to encourage Zimbabwean women participate in the transformation of the society, economy and policy making process. It is through this unique desk that the Women in Enterprise Conference and Awards was conceived in quest to craft strategies that are aimed at equipping and empowering women to successfully participate and benefit from Chamber activities and play their part in the economic revival of Zimbabwe. This platform also intends to help businesswomen to ultimately upscale their businesses and produce a breed of successful women entrepreneurs who can build generation businesses at a national and international level.

The 2013 edition themed “The roadmap to Zimbabwe’s desired future: Assessing and recognizing women-contribution to the economy.” which saw over 200 women entrepreneurs, business leaders and policy makers attending mainly focused on the confluence of policy, women economic empowerment and national development.

An exciting spin off from the conference was the introduction of a mentorship program named, “Mentorship in Practice” in 2014. The program offers aspiring female entrepreneurs and professionals and opportunity to benefit from business advisory services offered by prominent WECA alumni and other women achievers.

The 2014 WECA edition of WECA, under the theme ‘Mentorship Today, Cutting Edge Leadership Tomorrow’ again saw women network and converse on issues around financing, supply chain opportunities and ICT as a leverage to growing their businesses. The conference and dinner was attended by over 250 delegates. Deputy Minister Hon. Chiratidzo Mabuwa of Ministry of Industry and Commerce officially opened the conference at Rainbow Towers Hotel.

This year‘s WECA event will take place on the 18th Sept 2014 whose theme is “Promoting sustainable business and value addition for profitable agribusiness.” As a precursor to this, ZNCC Women’s Desk recently hosted a seminar for women in Agribusiness which was hugely successful as deliberations on value chains, funding, ICT for women in Agribusiness were deliberated on with key resolutions coming out for implementation.

ZNCC 2015 MID TERM FISCAL POLICY REVIEW ANALYSIS

The Treasury boss, Hon. Patrick Chinamasa delivered the country’s Mid Tem Fiscal Policy Review last Thursday. The review came at a time where expectations are high to address unemployment that has been further fuelled by the recent loosening of labour laws, amid banning of vendors in the CBD.

The Zimbabwe National Chamber of Commerce [ZNCC] notes with concern the ever widening budget deficit with second half revenue sitting on $US 1.8 billion whilst expenditures breached the US$2.118billion mark. We are worrying on how this budget deficit will be financed, if the government is to borrow to plug this gap, at what cost to the fiscus is it going to secure the funds or what return to the shareholders if banks are funding the gap. Generally speaking, treasury bills averaging 2% per annum is certainly not a funding mechanism to talk about. This compels us to push for the urgent restructuring of parastatals as the opportunity cost of missing revenue from government enterprises is becoming much more felt as we move into the distant from the time we officially dollarized.

 ZNCC notes with concern that GDP growth rate now pegged at 1,5% has drastically plummeted by half from the initial projections of 3,2%, while government revenue forecast had been revised to US$3.6 billion from US$3.99billion with a forecast fiscal deficit of US$400 million.

 A negative balance of payment also poses a threat to any possibility of returning to our own local currency. When the trade deficit widens, it implies the economy will find it difficult to sustain its own currency regime. Though exports grew by a mere 0.4% to US$1.3billion, imports spiked up by 2% to US$3.1billion.

 How the gap is to be slashed can only be a long term process, even though they was an increase in surtax on second hand vehicles from 25% to 35%, the ban on importation of second hand clothes and the removal of basic goods from the travellers rebate, this might not be a sufficient revenue raising mechanism to close the gap going forward. However we raise concern that the blanket ban of second hand clothes will have an adverse impact on the poor and unemployed who can’t afford to purchase new clothe in the formal sector.

 The Mid term statement highlights that the prevailing usurious lending rates are delaying the recovery of the manufacturing sector, given that the cost of credit is toxic. We compel the government to expedite the process of negotiating cheaper lines of credit and embracing the value chain systems by not funding hopeless companies which can only be a drain to the fiscus.

 Non perfoming parastatals have ‘amazing’ salary accruals with the NRZ owing $140 million, Air Zim about $136.4million and GMB owing about $20 million. Such a state significantly renders these parastatals technically insolvent. The state needs to take urgent steps to reform such parastatals given that even the ZIMASSET document is premised on the efficiency of these state enterprises. A bloated cum unsustainable current expenditure is definitely a function of government’s unnecessary pressure to bail out the perennially unprofitable state owned enterprises.

 Civil service retrenchments is a convenient option but we do not see it as a permanent solution to reducing government expenditure to 40% of GDP, however the entire retrenchment exercise must be treated with caution as it can further strain the already unimpressive tripartite relationships amongst government, labour and business.

 This budget review comes out quite strongly on taxes and much weaker on reforms. There is an urgent need to strengthen the management framework in parastatals, local authorities and government departments if we really care about sustainable recovery of the private sector. Duties and flexible labour laws alone may allow companies to leave for now in order to die another day.

 The proposed electricity tarrif reduction from 12,76 cents/kWh to match the regional levels should lower the cost of production for local manufacturers of both food and non food items. In addition, the mining sector, whose major cost of production is energy, stands to also benefit from this tarrif reduction. Such companies include Delta, Innscor, Dairibord, Bindura, Nickel, Rio Zim, Hwange Colliery and other manufacturers.

 Reintroduction of duties on various selected food items protects the food processing companies such as Dairibord, Innscor, and Colcom etc. There however is a downward risk to this. There is likely to be a insignificant cost push inflation in the short to medium term for these basic goods. Unless they are inelastic, we should witness a slight drop in sales volumes of the retail companies.

ZNCC Press Release on labour Reforms in Zimbabwe-29/07/15 Address by the ZNCC President

Greetings Ladies and Gentleman, members of the fourth estate and all invited stakeholders to this press conference.

The bigger picture is not what transpired between Zuva Petroleum Pvt Ltd vs Don Nyamande and Kingstone Donga in the Supreme Court but rather how the process of managing labour costs can be implemented without leading to either company closures or heightened poverty levels induced by non voluntary unemployment. Which therefore means recent rulings by the Supreme Court involving both the Zuva and the NRZ cases were a mere interpretation of the existing current labour law with no new wheels of laws having been invented?

The status quo of labour disputes with their employers has been an accumulation of challenges which companies faced in failing to lay off their staff since the slowing down of the economy. They had accumulated costs linked to poor productivity which had seen their production costs skyrocketing as a result of maintaining a similar labour force whilst capacity utilisation has plummeted.

As a chamber, our relationship with the government of Zimbabwe continues to shift from strength to strength as evidenced by their desire to listen to the concerns of our business constituency. We therefore do not have any doubt that every opinion or advice we forward to them is held in high regard.

The ruling by the supreme court on the labour matter involving former employees of Zuva Petroleum and the company had stirred both emotions and relief within our market, on the surface, it does appear like a blatant violation of worker rights but once one factors in the business environment we are operating in at the moment, there is no doubt that most companies in Zimbabwe are in debt distress. Surprisingly the Zuva Petroleum vs. its staff is not the first ruling of this kind under the similar circumstances, if my memory serves me well in the 90s, we had the Nhamo vs Chirisa case even though the judgement went unnoticed to the public.

However our major concern is to call for the government to amend the labour act, what is being presented to us at the moment as the labour bill is a piece meal exercise to solve a much broader problem. As the voice of business, we strongly feel it was important to make a direct comparison of labour laws with countries whose FDI inflows have been quite significant of late.

We urge our members to exercise restraint as they make decisions relating to labour issues within their concerns or companies. What came out of the Supreme Court should not be used as an excuse for unjustified dismissal or retrenchment of employees. This will be tantamount to fighting the Zimasset objectives which validates need for job creation. As the voice of business, we certainly cannot afford to promote unfair dismissals.

However dismissing an employee was a mammoth task which could not be achieved in less than 2 years on average, in the process it could cost a company its market, its reputation and even in extreme cases its balance sheet given that a litany of writ of executions were issued in the courts of law as recompense for aggrieved employees. Information at our desk in the chamber indicates that labour productivity in Zimbabwe has reached the nadir whilst a dollarized environment has posed an unsustainable cost income ratio for most corporate way above75% with the greater chunk of the cost base emanating from wages and salaries.

In most of the emerging economies as well as OECD countries, once an employer feels one is excess to their needs, it certainly doesn’t take the employer a month of Sundays. Whenever a company experiences a slowdown as we witnessed in 2007 during the subprime mortgage crisis which hit the entire transatlantic zone, banks and insurance companies were laying off staff as a cost containment measure. What is the rationale of forcing an employer to retain an employee who is no longer serving his or her contractual purpose?

THANK YOU.

Tobacco sales surpass target

HARARE July 28 (Herald) Tobacco sales have surpassed the target set by industry with 192 million kilogrammes having been traded at the auction floors this season. This is despite a poor rainy season characterised by erratic rains and flooding. The country is a major tobacco grower, and agriculture is identified as one of the pillars of the economic turnaround programme. Stakeholders in the tobacco industry had set a target of 85 million kilogrammes, down from the 222 million kg Government had predicted. Zimbabwe produced 216 million kg in 2014 and 165 million kg in 2013. Latest Tobacco Industry and Marketing Board statistics show that by last Friday; 192, 4 million kg worth $566 million were sold by farmers since the opening of the tobacco selling season. This is a decline of 8, 5 percent from the 209 million kg worth $666 million sold during the same period last year.

ZCTU snubs crisis indaba on sackings

HARARE July 28 (Herald) The Zimbabwe Congress of Trade Unions has abandoned workers in their time of need, with the pro-opposition umbrella labour representative body yesterday snubbing a meeting convened by the Government to finalise amendments to the Labour Act. The amendments are expected to cushion workers from being fired on three months’ notice without explanation following a recent ruling by the Supreme Court in that regard. Workers yesterday questioned the sincerity of the MDC-T-linked union, saying it seemed the organisation was satisfied with the status quo which has seen thousands of workers being sent packing. The Ministry of Public Service, Labour and Social Welfare convened an emergency meeting with employers and workers yesterday to iron out outstanding issues on the amendment of the Labour Act.

Commission to probe demonetization of Zim Dollar pensions

HARARE, July 28 (Newsday) President Robert Mugabe has appointed Retired Justice George Smith to chair a commission of inquiry into the conversion of pensions and insurance benefits to the United States dollar from the defunct Zimbabwean dollar. The move is set to bring closure to the matter which has been pending since Zimbabwe embraced the multi-currency regime in 2009. It also dovetails with the decommissioning of the Zimbabwean dollar from the formal system. The process to retire the local unit runs up to September. It began on June 15.

Supreme Court in another Labour Judgement

HARARE July 28 (Herald) The Supreme Court yesterday ruled that payment of housing, educational and other allowances is not a right to workers and employers are not obliged to pay them unless there is an agreement binding on the parties to that effect. Justice Venanda Ziyambi, sitting with Justices Elizabeth Gwaunza and Antonia Guvava, delivered the unanimous decision in favour of the National Railways of Zimbabwe in a case where the company was contesting the Labour Court judgment compelling it to pay its workers outstanding housing and educational allowances. The workers had won their case both before an arbitrator and the Labour Court with an order compelling NRZ to pay them some outstanding allowances despite the fact that the company had not agreed. However, the Supreme Court allowed NRZ’s appeal and ruled that it was not the arbitrators or courts’ business to impose conditions not agreed or to craft employment contracts on behalf of the parties.

Govt to secure $3m for SMEDCO

HARARE July 24 (Herald) Government is still in the process of finalising the $3 million loan from an Arab financial institution for the recapitalisation of the Small and Medium Enterprises Development Corporation (SMEDCO). Small and Medium Enterprises Development Minister Sithembiso Nyoni yesterday told a Millennial Economic Forum that Government was in the process of securing funding from the Arab Bank for Economic Development (BADEA) for the recapitalisation of SMEDCO and it was still work in progress. SMEDCO is a leading development finance institution for the promotion and development of micro, small and medium enterprises in the country which was formed in 1983 through an Act of Parliament. SMEDCO last year disbursed loans to 200 micro and small enterprises and 60 members from four cooperatives at an interest rate of 15 percent per annum.

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