Monday, February 28, 2011

From John Robertson

Last April you might recall my observation, "Several of the changes recorded by the Central Statistical Office in March 2010 seem likely to cause some surprise. Rents are said to have fallen by 16,4%...".

Well, the statistics office has reconsidered its claim that the figures collected showed that rents had fallen. In the January figures, the new figure is shown against a revised December figure, and the figures going back to July 2010 have also been revised upwards. It seems likely that the four months before that have also been revised, but the latest pages provided to not offer the records for those months. I will try to close the gap, which shows up in the graph, but if the stats office does not offer them now, we will get them in the tables to be published in the same months of this year.

The changes shown in the January 2011 figures are almost all minor, but as expected, passenger fares rose by a significant 12,59%. Apart from the indistinct Miscellaneous Other Services increase of 16,56%, the changes were mostly below 1% and the prices of 18 items went down slightly.

Price increases recently seen in world markets for many commodities seem certain to add to production costs, specially for food items, so it seems probable that the costs of many of the goods being imported will start rising a little more rapidly in the coming months. However, at 96,3 the index is still below the December 2008 = 100 figure, so average prices are still lower than they were two years ago. Current estimates suggest that we will get back to 100 only towards the end of this year.

Kindest regards,


Friday, February 25, 2011

From John Robertson

The annual percentage change in the Consumer Price Index went up slightly from 3,24% in December to 3,51% in January, according to the Zimstat tables issued today. The month-on-month percentage change showed a 1,1% increase in January, the largest portion of which came from Transport, which increased by 5,16% after passenger fares went up by 12,59%. The expected rise in fuel prices showed a much more modest 2,2%, which suggests that the sampling carried out for the prices survey did not include the service stations that had increased prices the most.

Thursday, February 24, 2011

Zimbabwe Government Orders State Power Utility to Reverse Rate Increase

Energy Minister Elton Mangoma said the decision was made by government after the potential impact on business and consumers became clear
Gibbs Dube
Washington 23 February 2011

Consumer Council of Zimbabwe Director Rosemary Siyachitema earlier blasted the troubled parastatal utility accusing it of misleading consumers when indicating the proposed rate increase was 30 percent when it was actually 50 percent

The Zimbabwean government has ordered the Zimbabwe Electricity Supply Authority to suspend a rate increase of 30 percent which it recently announced for fear that higher costs of power to consumers and business will cause broad economic damage.

Energy Minister Elton Mangoma said the decision was made by the government after the potential impact on households and enterprises became clear.

Mangoma said ZESA must consult consumers before proposing further rate increases. The proposed increase infuriated ZESA customers many of whom were already up in arms about massive electric bills despite chronic power outages.

Mangoma said it may take time for ZESA to come up with a new pricing scheme.

“We cannot set a specific time-frame for this as we need wide consultations on this issue,” he said.

ZESA spokesman Fullard Gwasira confirmed that the state utility has suspended the increase. “”Government is a major stakeholder in our day to day operations and if they order us not to increase rates, we comply with such directives,” Gwasira said.

Consumer Council of Zimbabwe Director Rosemary Siyachitema earlier blasted the troubled parastatal utility accusing it of misleading consumers when indicating the proposed rate increase was 30 percent when it was actually 50 percent.

Thursday, February 17, 2011

Implats Revenue Up On Metal Prices, Zimbabwe On Track

By Devon Maylie
Published February 17, 2011

LONDON -(Dow Jones)- Impala Platinum Holdings Ltd. (IMP.JO), the world's second-largest producer of the metal, Thursday reported a rise in net profit for the first half of fiscal 2011 due mainly to increased volumes and stronger dollar metal prices, and said it's on track with its expansion project in Zimbabwe.

Impala reiterated that it plans to produce 1.85 million troy ounces of platinum in 2011 with 940,000 ounces of that coming from the South Africa-based Rustenburg mine.

Output in the first half of the year rose 6% to 952,000 ounces, the Johannesburg-based miner said Thursday.

The miner said output at its majority-owned Zimplats Holdings Ltd. (ZIM.AU) rose by 9% to 89,000 ounces. The first phase of the expansion project at the Zimbabwe-focused company was completed and the second phase is underway, chief executive David Brown said.
A Nice, Wholesome Hooters Girl for the Kids Coca Cola's Secret Recipe Allegedly Revealed by Radio Program How Much it Costs to Attend Super Bowl XLV House Begins Debate Over Plan to Chop Spending for Remainder of 2011 7 Tips for Negotiating With The IRS "The Phase Two expansion at Zimplats, which forms a key part of our growth strategy to 2.1 million ounces of platinum by 2014, has commenced and is progressing satisfactorily," Brown added.

The miner is holding discussions with the Zimbabwe government over how Impala will address the new law that requires companies to sell a 51% stake to locals.

"We are encouraged that government wants a dialogue with us given we are a major employer," Brown said. "Once we get clarity we will know how to expand further. Phase Three needs that clarity."

Impala Platinum said demand for platinum and palladium will remain strong and it forecasts the price of palladium to exceed $1,000/oz beyond 2012. For this year, it expects platinum to trade between $1,725/oz and $1,925/oz. It sees palladium between $775/oz and 950/oz and rhodium between $2,250/oz and $2,600/oz.

South Africa produces about two third of global platinum output a year. Prices on the spot market are currently trading around $1,823.25/oz and palladium is at $833.50/oz.

Impala Platinum revenue for the first half of fiscal 2011 of 15.32 billion rand compared to 11.12 billion the year before. Capital expenditure for the half year totaled ZAR2.4 billion, compared to ZAR2.2 billion in the previous half year.

Copyright © 2011 Dow Jones Newswires

Monday, February 14, 2011

Zim to stick with foreign currencies: Mutambara

13/02/2011 00:00:00

by Business Reporter
Sticking with it ... Arthur Mutambar

DEPUTY Prime Minister Arthur Mutambara has said Zimbabwe will continue to use foreign currencies until capacity utilization improved to levels that can support the value of a local currency.

Mutambara said Zimbabwe should continue to pursue various economic reforms before rushing into making currency changes.

He was addressing delegates who attended a recent London Stock Exchange symposium in Harare.

Once considered among the highest value currency units in the world when it was it introduced in 1980, the Zimbabwe dollar was ditched in 2009 when it was virtually worthless, battered by political turmoil in the country and hyper-inflation.

The country has been using foreign currencies since with the Botswana Pula, the South African Rand and the United States dollar among the most popular.

Mutambara said the policy not to have a local currency in the interim was shared by principals in the inclusive government.

“Our desire is that the Zimbabwe dollar should not come back until we deserve a currency,” said Mutambara.

“At the moment we don’t deserve to have our own currency. Maybe in 2015 or 2020 can we start thinking of our own currency.”

He however conceded that there was no guarantee the policy would not change after elections widely expected sometime this year.

Tuesday, February 8, 2011

Zimbabwe debt arrears hit USD 4.8 billion

PTI 03:02 PM,Feb 07,2011

Harare, Feb 7 (ZIMONLINE) Zimbabwe's foreign debt stood at more than USD 6.9 billion at the end of 2010 while the country has fallen behind on its payments to external creditors to the tune of USD 4.8 billion, according to latest data from the central bank. Reserve Bank of Zimbabwe (RBZ) governor Gideon Gono said the southern African country's total external debt stock amounted to USD 6,929 million as at Dec 31, 2010, representing 103 per cent of GDP. This is way above the international debt sustainability benchmark of 60 percent. "The bulk of the country's external debt is owed to multilateral creditors which account for 36 percent of the country's total debt," Gono said. Bilateral and commercial creditors are owed 33 percent and 31 percent, respectively. Central government was the largest debtor at 57 percent while parastatals and the private sector owed 35 percent and 8 percent, respectively. The ballooning arrears on the external debt have prevented multilateral creditors such as the International Monetary Fund and the World Bank from extending new loans to Zimbabwe, demanding that the country clears the outstanding balances first before becoming eligible for further financial support. Harare owes close to USD 1 billion in arrears to the IMF, World Bank and African Development Bank. Economists and the IMF have contended that the only way Harare could pull itself out of its current debt trap is through international debt forgiveness. An IMF staff paper published last July said Zimbabwe was in debt distress and warned that neither the right economic policies nor its mineral wealth could immediately resolve the country's large debt problem. IMF staff estimate that Zimbabwe's foreign debt is projected to reach 151 per cent of GDP by 2015, with 104 pe rcent of GDP in arrears. To win debt relief Zimbabwe would need to improve ties with the international community and qualify for a global scheme for heavily indebted poor countries that would lead to debt cancellation after a two-year economic programme. Zimbabwe has struggled to win donor support despite the formation of a coalition government last year while private capital inflows have fallen over concerns about a government plan to force foreign-owned firms to sell majority shares to locals. ZIMONLINE

Monday, February 7, 2011

Cable reveals Biti's hand in Zimbabwe sanctions

By: Samantha Chidzero

Posted: Sunday, February 6, 2011 8:47 am

THE Movement for Democratic Change party has been working with the European Union in the maintenance and partial lifting of sanctions against Zimbabwe, despite claims by that party that they have no control of decisions made in Brussels over Zimbabwe.

A confidential cable released on Friday by whistle-blowing website WikiLeaks shows that MDC-T secretary general Tendai Biti has been making recommendations to the EU over who should, and who should not, remain on the sanctions list.

Despite media remarks by Biti that sanctions were hurting the economy and should be lifted, he has been advocating their "partial lifting".

The confidential memo released on Friday entitled "SOMALIA/ZIMBABWE/SOUTH AFRICA: UK MINISTERS ON RESOURCES, SANCTIONS, AND RELATIONS" quotes Biti suggesting the "partial lifting" of sanctions against eight parastatals and at least one individual and informing the EU of dead persons on the sanctions list.
The cable, which originated from the US embassy in London, in January 2010 says the EU "decided to support ... a minimal lifting of sanctions on Zimbabwe by delisting the eight parastatals requested by Finance Minister Tendai Biti."

The memo also revealed that Biti was instrumental in having Zapu leader Dumiso Dabengwa removed from the list: "UK ministers agreed to support within the EU the de-listing of (1) the eight parastatals requested by Zimbabwean Foreign Minister Tendai Biti, (2) any persons on the list who have died, (3) a Lebanese national (NFI), and (4) former ZANU-PF supporter Dr. Dumiso Dabengwa."

The confidential diplomatic dispatch put paid to claims that MDC-T has no control over the sanctions policy in Brussels.
It also shows the duplicity of the MDC-T within the inclusive Government.

Ironically, Biti's MDC-T party has been involved in the EU-Zimbabwe political dialogue team which seeks to normalise relations (including lifting of Art. 96 of the Cotonou Agreement and sanctions) alongside progress in the implementation of the Global Political Agreement.

A separate confidential cable released last week revealed that MDC-T leader Morgan Tsvangirai, who is also the prime minister in the inclusive Government, used a state visit to the US to plot regime change in Zimbabwe.

Last year the MDC-T said it has no control in the matter of sanctions after President Mugabe and his Zanu-PF party charged that the former opposition party had a hand in setting the sanctions and therefore should be held responsible for removing them.

Zanu-PF has maintained that it will not give in to anymore MDC-T demands as it was not playing its role in the lifting of sanctions.

Wednesday, February 2, 2011

Subject: Poverty Datum Line update

Subject: Poverty Datum Line update

Figures for December have now been received from the Central Statistical Office and they show that the cost of food went down slightly in December and the average is almost the same as it was in February 2010. For all the items in the index, the December figure was also down on November's and also not far off the figure for February, but all the prices had increased during the year and they peaked out in May for food and in June for the full range of goods in the index.

No details of the items included in the index are provided in these tables, but the differences in costs between different parts of the country are shown. Compared to $466,85, the average cost for the basic requirements for a family of five for the whole country, the figure for Harare is $455,41, for Bulawayo $476,15, for Masvingo $473,57 and for Manicaland $452,29. The highest figure for the country is Matabeleland North at $507,53 and the lowest is Mashonaland Central $430,48.

The fact that a very high percentage of the working population is not earning as much as $400 a month suggests that either most households have more than one source of income, or that the definition of the word “poverty” should be re-examined. In many other countries, the monthly wages are known to be very much lower than the rates of pay in Zimbabwe and they would probably be extremely envious of their Zimbabwean counterparts.

Unfortunately for Zimbabweans, the goods that our retailers can import from those countries are making many of the jobs in this country extremely insecure and employment growth appears not to be happening in any important business sector.

The trades unions are using these PDL figures to strengthen their arguments for pay increases that will further reduce Zimbabwean manufacturers’ hopes of being able to compete, so all the signs suggest that the whole issue should become the subject of much more intense debate. But before that debate starts, workers should be advised that if their trades unions get their way, it will be at the expense of many of the jobs that exist today and many more jobs that will never come into existence.

Kindest regards,


China to pump in US$10bn into Zimbabwe's economy

By: MW-Reuters-TZG
Posted: Wednesday, February 2, 2011 12:54 am

CHINA Development Bank is poised to fund up to US$10 billion in Chinese investment in the Zimbabwean mining and agriculture sectors ‒ a significant boost for a country struggling to attract foreign investors.

President Robert Mugabe adopted a 'Look East Policy' after the west imposed illegal sanctions on Zimbabwe.
He has increasingly looked for help from China, which in turn is in search of natural resources for its rapidly expanding economy.
“We have met with officials from China Development Bank and they have said they are willing to invest up to US$10 billion in Zimbabwe," economic planning and investment promotion minister Tapiwa Mashakada told Reuters on the sidelines of a business conferencein Harare, Zimbabwe.

Such an investment would dwarf Zimbabwe's gross domestic product (GDP), which is expected to be about US$6 billion this year.
No immediate comment was available from the Chinese embassy in Harare.
Mashakada told the conference he saw gold production hitting 13t in 2011, up from 8.3t in 2010.

He also expected Zimbabwe to produce about 1.5Mt of maize in 2011, up from 1.3 million a year before. Zimbabwe also has the world's second largest platinum reserves after South Africa.

“China is looking into mining development, as well as agriculture, infrastructure development and information communication technology,” said Mashakada, a minister from Prime Minister Morgan Tsvangirai's Movement for Democratic Change party. He would not say if the investment would come this year.
China's investment in Zimbabwe has been growing steadily over the last decade.
“The Chinese are now moving towards strict due diligence, accountability and transparency.
"At the end of the day this really depends on us, and how we position ourselves as a destination for investment,” said Mashakada. “China is coming in a very big way.”