A digital copy of the Business News 24 (23 March 2015 edition). Zimbabwe's premier business news free sheet published by the Zimpapers Newspapers Group (1980) Limited and available every week day from 1530hrs to give a summary of the day's business news.

1. News Update as @ 1530 hours, Monday 23 March 2015
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Business Reporters
HARARE - The Deposit Protection Corpo-
ration (DPC) says it has so far compen-
sated 15.6 percent of insured Interfin
Bank deposits and 8.1 percent of Allied
Bank deposits while compensation for
Afrasia Bank’s depositors will commence
soon.Accordingtoreports,Interfin,whose
banking license was cancelled in 2012,
owes depositors more than $60 million
whileAlliedbankowesatleast$14,7mil-
liontoitsdepositors,ofwhich$1,3willbe
paidbytheDPC.
DPC will also pay out $3,3 million to 18
000 Afrasia depositors. DPC through the
Deposit Protection Fund is mandated to
compensateatleast90percentofdepos-
itorsuptothemaximuminsurablelimit.
In emailed responses to questions from
BH24,DPCpublicrelationsmanagerAllen
MusadzirumasaidpaymentstoAlliedand
Interfin bank depositors began on Feb-
ruary 23 and March 3 respectively while
payments to Genesis Investment Bank,
Royal Bank and Trust Bank depositors is
inprogress.
“DPC was appointed by the High Court
as provisional liquidator of AfrAsia Bank
on Wednesday 18th of March 2015. We
hope to commence payments soon once
the requisite administrative procedures
have been finalised. At least 83 percent
of AfrAsia depositors will be paid in full as
they have balances below the insurable
limitof$500,”hesaid.
DPChasinthepastsaidstrugglingbanks
were not paying premiums towards the
fund, putting strain on the DPC when it
is time to compensate depositors.How-
ever,Musadzirumasaidthefundisableto
meet its statutory obligation of compen-
sating small depositors of failed banking
institutionsasperitsmandate.
“Depositors with balances below $500
are paid through convenient payment
channelssuchasmobilephoneandbank
transfers.Clientswithbalancesabovethe
insurable limit of $500 will still be paid
theirdepositsthroughtheliquidationpro-
cess on a pro-rata basis,” he said.He said
the closure of banks is negatively affect-
ing depositor confidence in the banking
system.
“However, the existence of an explicit
deposit protection scheme helps to pro-
tect depositors by providing a guarantee
of compensation in the event of a mem-
berbankfailure,”hesaid. ●
DPC compensates 16pc of Interfin depositors

2. ByTawandaMusarurwa
HARARE - The Zimbabwe Energy Reg-
ulatory Authority (ZERA) maintains
that despite challenges on the supply
side of electricity, the energy tariff is
in line with what is prevailing in the
region.
Zimbabwe has an average end user
tariff of 9.86 US cents per kilowatt hour
(c/kWh). And according to a regional
comparison done by the regulator,
Angola and Zambia offer a significantly
cheaper electricity tariff rate to the
extent of subsidies in those two coun-
tries.
Angola's average end user tariff cur-
rently stands at 5.4c/kWh, while in
Malawi it stands at 9c/kWh, and
Namibia has an average tariff of 17c/
kWh.Zambia's average end user tariff
is 6c/kWh, while that of Lesotho stands
at 9.3c/kWh and that of Swaziland at
10.3c/kWh.
Mozambique's energy tariff stands at
9c/kWh, and that South Africa (the
municipalities) is at 11.7c/kWh, and
that of the power utility Eskom is at 8c/
kWh. ZERA chief executive officer Engi-
neer Gloria Magombo said "there has
not been a significant change in the
average tariff over the past four years,"
despite a couple of adjustments during
that period.
In 2009, the national average tariff
(USc/kWh) was 7.53, a figure which
remained flat in 2010, but increased to
9.83 in 2011. It remained unchanged
again in 2012, but rose marginally to
9.86 in 2013.
Last year, ZERA turned down a request
by the national power utility Zimbabwe
Electricity Supply Authority (ZESA) to
increase tariffs by a 5 percent margin.
The Zimbabwe Electricity Transmission
and Distribution Company (ZETDC)
had applied for a 5 percent upward
review of the electricity tariff from
the 9.86c/kWh to 10,36c/kWh on the
basis that this was in line with its rev-
enue requirement of $890.60 million
for supply of 8 594 gigawatt per hour
(Gw/h) of electricity. Engineer Mag-
ombo however said the regulator will
initially allow new (independent power
projects) coming on board to charge a
higher tariff to cover the cost of expen-
sive borrowings.
"But an issue we have found with new
projects coming in now is that of lack
of access to long-term funding, and
access to medium-term funding comes
at a higher cost and what that does is
that the tariffs of these new projects
will be higher than normal," she said.
●
2 NEWS2 NEWS
Zim electricity tariff competitive in the region: ZERA

3. BH24

4. ByFunny Hudzerema
HARARE – Government has launched
the National Bio-fuels Policy, which
is expected to reduce Zimbabwe's
dependence on importing fuel from
other countries and allow for the use of
local non-renewable resources.
Speaking at the launch of the National
Bio-fuels Policy Deputy Minister of
Energy and Power Development Tsitsi
Muzenda said the production of bio-fu-
els can have a broad impact on the
economy.
“Our country is a net importer of fossil
fuel energy, its current requirements
are about 2,5 million and 1,5 mil-
lion litres of diesel and petrol per day
respectively.
Widespread use of bio-fuels can there-
fore reduce the country’s dependence
on imported petroleum products, sta-
bilise fuel prices, ensure energy secu-
rity to promote rural development and
investment reduce poverty and create
employment,” she said.
Currently the Government has estab-
lished bio-diesel processing plants with
capabilitiesofhandling10000litresper
dayinMutokoand60000litresperday
at Mt Hampden, which are then part-
nered with Greenfuel to produce sug-
arcane based bio-ethanol fuel.
Muzenda said the National Bio-fuels
Policy will spearhead the use of local
resources and implement the opera-
tions local bio manufacturing plants in
the country. In 2013 the Government
introduced a mandatory five percent
blending of bio-ethanol with petrol,
which was then raised to 15 percent
last year.
Establishment of the policy was sup-
ported by the European Union in sup-
port of the country's fuel sector. She
added that the policy was in line with
the EU’s Renewable Energy Directive
of 2009 which set targets for the con-
sumption of renewable energy in the
EU’s transport sector from 2 percent in
2005 to 6 percent in 2010 and eventu-
ally 10 percent in 2020.
“Such global developments have
opened opportunities for bio-fuels
investments in developing countries
such as Zimbabwe that have suitable
land and water requirements,” said
Muzenda.
The National Bio-fuels Policy will now
undergo the consultative process for
three months both locally and interna-
tionally before being submitted to Cab-
inet in May for approval. ●
44 NEWS
Govt launches National Bio-fuels Policy

5. BH24

6. By Rumbidzai Zinyuke
Lowveld sugar producer Tongaat Hul-
lets has engaged Government over
a request for a license for continuous
supply of fuel grade ethanol to the local
market.
The company’s Triangle mill has an
ethanol plant with an installed capacity
of 41 million litres and has been pro-
ducing only 24 million litres due to low
demand.
Tongaat Hullet managing director Mr
Sydney Mutsambiwa recently told
Parliamentarians that the company
has already been issued with several
temporary licenses to meet national
demand but was now seeking a license
for continuous supply.
“We do have the capacity, it’s just a
question of ensuring that the regu-
latory requirements by Zimbabwe
EnergyRegulatoryAuthorityaremetto
a level that allows us to have continu-
ous production capacity. We have been
engaging government in this respect
and we are advised that due consid-
eration is being given to that request.
So we await to see where we go from
here,” he said. Under the country’s
mandatory blending policy, only Green
Fuel is licensed to trade the commodity
for petrol blending purposes.
Triangle has however been granted
several temporary licenses to meet
demand over the past several years.
Mr Mutsambiwa said the ethanol plant
at Triangle has since been upgraded to
produce fuel grade ethanol at 93 per-
cent.
“In the current year we are geared to
produce fuel grade ethanol for supply
to the local market as required by the
implementing agent who in the last
time was the National Oil Infrastruc-
ture Company, the government arm
responsible for fuel retailing,” he said.
The company is also seeking to add 29
000 hectares of land to its out growers
in an effort to more than double its out-
put by 2018.
Tongaat Hulett Limited, owns a 50,3
percent interest in Hippo Valley and
100 percent of Triangle Zimbabwe Lim-
ited. ●
66 NEWS
Tongaat Hullet seeks ethanol license

7. BH24

8. HARARE – The equities market recov-
ered slightly to close the week in the
positive as the industrial index gained
0.33 to close on 162.36.
Old Mutual gained 2 cents to close at
239 cents and Innscor moved up 1,51
cents to trade at 56,51 cents. Bever-
ages maker Delta and Econet traded
unchanged 109 cents and 52 cents
respectively.
Counters in the negative territory
included cigarette manufacturer BAT
which eased 10 cents to 1160 cents,
Mash Holdings lost 0,20 cents to close
at 2 cents and Padenga slid 0,10 cents
to settle at 9 cents.
Volumes were down on yesterday and
supported by trades in Econet, Seedco
and Delta to reach $678 706. Despite
today’s gain the industrial index lost
0.34 this week compared to last week.
The Mining index retreated by 0.12 to
close at 48.42 after Hwange slipped
0,10 cents to close at 4 cents. Bindura,
Falgold and RioZim were unchanged
at 4,49 cents, 0,50 cents and 7 cents
respectively. Week on week the min-
ing index dropped 1.37. —BH24
Reporter •
8 ZSE REVIEW
Old Mutual, Innscor push ZSE recovery

9. BH24

10. A rally that made Nigerian bonds the
best performers in Africa in March risks
coming to an end as the credit rating of
the continent’s biggest economy slides
deeper into junk.
Standard & Poor’s lowered its assess-
ment on Nigeria one level to B+, four
levelsbelowinvestmentgrade,onMarch
20, while changing its outlook to stable
from negative. Naira bonds returned 2
percent this month, the most among
31 emerging markets after Russia and
the Dominican Republic, according to
Bloomberg indexes. Naira debt lost 5
percent in February.
Nigeria’s economy is sputtering under
the weight of a more than 50 percent
plunge since June in the price of oil, its
main export, and an insurgency by Isla-
mist militants before elections on March
28.Whilethecentralbankhasstemmed
a slide in the naira with 17 foreign-ex-
change restrictions since September,
policy makers may devalue the currency
after the vote, so it doesn’t make sense
to buy local bonds, according to Alan
Cameron, an economist at Exotix Part-
ners LLP in London.
“A downgrade worsens public and inves-
tor perception of the economy, which is
alreadybeinghit,”KunleEzun,ananalyst
at Ecobank Transnational Inc. in Lagos,
saidbyphonelastweek.Borrowingcosts
willincreasebecauseofthenegativesig-
nal it sends, he said.
Nigeria’scurrencylost18percentagainst
the dollar in the past six months, the
steepest decline among 24 African cur-
rencies tracked by Bloomberg after the
Zambian kwacha. It touched an all-time
low of 206.32 per dollar on Feb. 12. The
naira advanced 0.1 percent to 199.05
as of 8:43 a.m. in Lagos on Monday. —
Bloomberg ●
REGIONAL News10
Nigeria’s fall deeper into junk risks Africa’s best bond rally

11. BH24

12. 12 DIARY OF EVENTS
The black arrow indicate level of load shedding across the country.
POWER GENERATION STATS
Gen Station
23 March 15
Energy
(Megawatts)
Hwange 328 MW
Kariba 738 MW
Harare 0 MW
Munyati 28 MW
Bulawayo 24 MW
Imports 20 MW
Total 1143 MW
26 MARCH - Willdale Annual
General Meeting of Willdale
Limited; Place: Boardroom,
Willdale Administration Block,
Tenerife Factory, 19.5km
peg Lomagundi Road, Mount
Hampden;
Time: 1100 hrs...
31 MARCH - African Sun
Ltd's Forty Third Annual
General Meeting of Share-
holders; Place: Kariba Room
at Holiday Inn Harare, Corner
5th Street and Samora Machel
Avenue; Time: 1100 hours...
THE BH24 DIARY

13. BH24

14. 14 zse
ZSE
Movers CHANGE Today Price USc SHAKERS Change TODAY Price USc
NicozDiamond 7.69 1.40 CFI Holdings -25.00 1.50
Old Mutual 1.25 242.00 NMBZ -14.28 3.00
OK Zim -5.71 13.20
BNC -4.23 4.30
TSL -4.16 23.00
Indices
Index Previous Today Move Change
Industrial 162.36 161.48 -0.88 points -0.54%
Mining 48.42 46.71 -1.71 points -3.53%
Stocks Exchange

15. 15 AFRICA StockS
Botswana 8,664.65 -11.96 -0.14% 12July
Cote dIvoire 249.37 -2.77 -1.10% 13Jan
Egypt 9,544.08 +235.10 +2.53% 14Jan
Ghana 2,259.78 -0.36 -0.02% 13Jan
Kenya 5,138.07 +16.08 +0.31% 13Jan
Malawi 14,904.99 +0.00 +0.00% 14Jan
Mauritius 6,693.78 -23.07 -0.34% 14Jan
Morocco 10,221.94 +195.15 +1.95% 13Jan
Nigeria 28,740.61 -1,149.25 -3.84% 14Jan
Rwanda 143.39 +0.20 +0.14% 02Oct
Tanzania 2,602.19 -30.74 -1.17% 28Oct
Tunisia 4,624.39 -39.32 -0.84% 07Mar
Uganda 1,942.77 -12.69 -0.65% 10Dec
Zambia 6,155.26 +3.96 +0.06% 12Jan
Zimbabwe 164.41 +0.66 +0.40% 14Jan
African stock round up Commodity Prices
Name Price
Crude Oil 1,300.91 -0.21%
Spot Gold USD/oz 1,292.63 -0.26%
Spot Silver USD/oz 19.38 -0.46%
Spot Platinum USD/oz 1,421.25 -0.33%
Spot Palladium USD/oz 798.50 -0.64%
LME Copper USD/t 6,770 -0.18%
LME Aluminium USD/t 1,780 -1.17%
LME Nickel USD/t 18,230 -1.73%
LME Lead USD/t 2,095 -1.41%
Quote of the day — Your
past is done, so forget
it. Your future is yet to
come, so dream it, but
your present is now, so
live it with no regrets!
Globalshareholder.com

16. Gold retained gains from a three-day
rally on Monday to trade near its high-
est in two weeks, boosted by a weaker
dollar and caution from the Federal
Reserveonthetimingofapossiblehike
in U.S. interest rates.
Spot gold was little changed at
$1,182.55 an ounce by 0715 GMT.
It climbed to $1,187.80 on Friday, its
highest since March 6, as the dollar
tumbled.
The greenback has been under pres-
sure since last Wednesday when the
Fed sounded a cautious note on the
health of economic recovery in the
United States, and slashed its median
estimate for the federal funds rate.
Market players' consensus expectation
for a U.S. interest rate increase has
shifted, with most of Wall Street's top
banks now expecting the Fed to hold
off until at least September and
the odds for a June hike fading, a Reu-
ters poll showed.
"With the rate hike not expected until
September, some unwinding of short
positions on gold are expected and a
weaker dollar in the interim is also set
to boost demand for gold," said Phillip
Futures analyst Howie Lee.
Traders said the next key level for gold
is $1,200 on the upside.
Gold had dipped to a four-month low
before the Fed meet last week as con-
cerns mounted over higher U.S. inter-
est rates which could dent demand for
non-interest bearing bullion. But it has
recovered since.
The dollar started trade in Asia on the
defensive, after a volatile few days in
the wake of the Fed's dovish steer,
which cast doubts on bullish positions
in the greenback.
Despite the modest gain in bullion
prices, data showed that investor sen-
timent has not improved drastically.
SPDR Gold Trust, the world's largest
gold-backed exchange-traded fund,
said its holdings fell 0.72 percent to
744.40 tonnes on Friday - the lowest
since late January.
Hedge funds and money managers
slashed their bullish bets in gold and
silver futures and options for a sixth
straight week in the week ended March
17, U.S. Commodity Futures Trading
Commission data showed on Friday.
In the physical markets, demand
seemed to have weakened compared
to last week's levels.
InChina,thesecondbiggestconsumer,
premiums eased to $4-$5 an ounce,
lower from Friday's levels of $6-$7. —
Reuters ●
16 INTERNATIONAL NEWS
Gold near 2-week high

17. By Charles Dhewa
Farmers and traders have to juggle
more than three variables to be suc-
cessful which is why adaptation chal-
lenges are more current than technical
challenges. Unfortunately formal insti-
tutions like banks do notunderstand
all these variables and farmers’ coping
mechanisms.
Consequently, farmers and traders
continue to be subjected to the same
credit bureau rules meant for the for-
mal sector. It looks like forcing formal
institutions to understand the indig-
enous commerce (‘informal sector’)
is like forcing a large plane to land on
an airport designed for Helicopters and
small planes.
While formal institutions tend to focus
on topical knowledge spewed from
educational institutions, this knowledge
has problems adjusting to local practi-
cal contexts that are typical of indige-
nous commerce. Instructive teaching
and learning are useless in indigenous
commerce.
A credit bureau for indigenous com-
merce should take into account how
traders and farmers deconstruct and
reconstruct knowledge in complex
markets where cash and barter deals
co-exist.
By not capturing barter deals and rela-
tionships, a formal credit bureau fails to
capture a critical component of indige-
nous commerce. Whether farmers and
traders follow recommendations from
formal banks is a hit-or-miss scenario
because they are chasing many varia-
bles as indicated above.
In indigenous commerce, there is
no guarantee that banking manuals,
financial research reports and recom-
mendations will be translated into real
financial solutions.
Knowledge should be more analytical
than operational financial institutions
are to understand indigenous com-
merce.
This is because knowledge is just one
essential ingredient of competency in
indigenous commerce with trust and
relationships being some of the most
important ingredients.
What is important is not knowing about
the world of banking but knowing what
is required to actually go out and make
a difference in the real world.
Inindigenouscommerce,learninghap-
pens fast within networks of traders
and farmers who bypass the classical
reporting loop.
When traders and farmers learn from
each other according to their lines of
business, they immediately put knowl-
edge into practice without waiting for
someone to document what is going
on in the market.
ICTs are enhancing learning that
happens through direct knowledge
17 analysis
Why indigenous commerce deserves its own Credit Bureau
17 analysis

18. exchange in the market without going
through some hierarchical filter. In this
case, traders and farmers in the mar-
ket frontline of markets constitute deep
sources of practical wisdom.
However, there are limits to how farm-
ers and traders can learn from other
people's experience.
Social learning processes like those
happening in indigenous commerce
cannot be mandated formally from the
top or cut short before going through
their full cycles.
Adaptive challenges faced by trad-
ers and farmers in agriculture mar-
kets require co-creating of solutions,
whether financial or economic.
Trader and farmer experiences can-
not be photocopied and dumped in
Zimbabwe. Otherwise we end up with
well articulated and analyzed business
models which do not speak to the real-
ity on the market.
Understanding what farmers and trad-
ers are struggling with on the ground is
the basis for a relevant credit bureau.
Unfortunately, Zimbabwean institu-
tions like banks and development part-
ners are failing to grasp and distinguish
adaptive from technical issues con-
fronting the agriculture sector.
While the technical angle emphasizes
knowledge from experts such as bank-
ers, the agriculture sector is in the
throes of adaptive challenges where
solutions are not known and have to
be co-created by farmers, traders,
academics, consumers, transporters,
development partners and policy mak-
ers.
A strong credit bureau will have to
evolve from perspectives from all these
clusters. It can’t emerge from throwing
technical solutions at the issues. Turn-
ing adaptive challenges into technical
problems and solutions is a big mistake
that has to be avoided.
The idea behind a Credit Bureau
for Market Traders
eMKambo has set out to mobilize
ideas and institutions toward creating
a Credit Bureau for traders and farm-
ers operating in indigenous commerce.
This initiative will build the confidence
of financial institutions so that they
starttakingtradersasborrowersrather
than just anticipated savers.
Negative perceptions about people’s
markets like Mbare, Malaleni, Sakubva
and many others have prevailed for
a long time, cementing some level of
reluctance by financial institutions to
lend money to traders.
Existing formal credit bureaus that are
usedtoassessindividuals’creditworthi-
ness are not entirely relevant because
they focus on employment-based bor-
rowing histories.
On the other hand, the people’s market
is populated by people who have never
been formally employed. This means
there business or transaction history
will be missing from the formal credit
bureau.
Traders are responsible for moving
more than 60% of the food that flows
into urban areas from production
zones. In fact, markets like Mbare are
the first ports of call for all the food that
ends up in many urban markets and
small markets run by vendors in high
density areas.
Money and relationships are respon-
sible for moving all this food. A credit
bureau that captures all these dynam-
ics is needed.
Features of an ideal indigenous com-
merce credit bureau
The Indigenous Commerce Credit
Bureau that eMKambo is crafting pro-
vides vital and up to the minute infor-
mation about each trader and farmer.
This information will be available for
serious financiers keen to advance
loans to traders. Towards consolidat-
ing the credit bureau, eMKambo has
already compiled the following details
for each of the close to 10 000 traders
that deal in food and other commodi-
ties in 20 markets across Zimbabwe:
1. Name and Surname.
2. Gender.
3. Date of birth.
4. Contact address.
5. Stall address.
6. Trading years.
7. Commodity specialization.
8. Average volumes traded per day/
week/month/year.
9. Average revenue per day/week/
18 analysis

19. month/year.
10. Profits realized per day/week/year.
11. Loans (formal or informal) applied
before.
12. Repayment history.13. Current
loan (formal or informal) status.
14. Social capital (relationships)
A scale of scores is being designed
for each trader or farmer. The level
of default determines the score. The
higher the score the better. If a trader
changes from poor performance to
a better performance the score is
increased. Before writing off a trader,
many aspects are considered. Some
traders prefer holding their cash as
stock not as physical cash so they are
never liquid. The business cycle differs
with the type of produce traded.
Vegetables usually do not take up
more than three days on the stall
and this implies within three days the
trader would have realized a profit. In
instances where a trader is selling dried
grains the stock might take about a
week or more. This means traders spe-
cializing in different commodities have
to be treated differently. The Indige-
nous Commerce Credit Bureau sets
scores in ways that differentiates trad-
ers and farmers in line with the nature
of their businesses.
The main advantages of having a
Credit Bureau for the Agriculture mar-
ket traders include:•
• Traders become aware of the
importance of discipline in business.
Recording all their transactions will
make them see if they are making a
profit, loss or if they are breaking even
hence giving them room for business
growth.
• Increasing traders’ chances of
obtaining loans and support from other
stakeholders interested in agriculture
because the credit bureau enhances
confidence in the trader’s business.
• The credit bureau shows busi-
ness trends for each trader or farmer
– an indicator of progress and what
needs improving from operational or
policy angles.
Developing scorecards appropriate for
traders and farmers working in indig-
enous commerce requires a combi-
nation of technical modeling skills and
practical knowledge of how people’s
markets function on a daily basis.
However, since the scorecard in the
credit bureau does not replace human
judgment but complements human
intelligence, eMKambo has financial
literacy officers whose roles include
providing the humane judgement that
is critical for sustaining relationships
in indigenous commerce. - eMkambo
*The writer can be contacted on the
following emails: Charles@knowl-
edgetransafrica.com / charles@
emkambo.co.zw ●
19 analysis