- Qatar Airways will soon introduce three flights per week to Harare, Zimbabwe as part of expanding business ventures between Qatar and Zimbabwe. The new Qatari ambassador announced the planned flights after meeting with Zimbabwe's President Mugabe. - Qatar Airways is the flag carrier of Qatar and one of the world's leading airlines. It currently operates 10 flights per week between Johannesburg and Doha and wants to extend some of those to connect Harare. - The renewed interest in Zimbabwe's aviation sector comes as the national carrier Air Zimbabwe has suspended most international routes due to financial problems. Other airlines have also expressed interest in resuming flights to Harare.

1. News Update as @ 1530 hours, Friday 6 June 2014
Feedback: bh24admin@zimpapers.co.zwEmail: bh24feedback@zimpapers.co.zw
By Tawanda Musarurwa
Giant retailer OK Zimbabwe yesterday
reported a decline in profitability for
FY2014 as overheads increased and
deflationary pressures weighed heavy.
Profit for the year ended March 31,
2014 amounted to $9,68 million com-
pared to $12,3 million in the prior year.
Basic earnings per share was 0,85
cents down from 1,19 cents last year.
The decline in profitability was attrib-
utable to depressed demand but also
mainly to an increase in overheads,
which went up by 6,3 percent ahead of
the growth in revenue of 0,9 percent.
CEO Willard Zireva told analysts yes-
terday that the tight liquidity situation
that prevailed during the period under
review resulted in depressed demand.
"Deflationary cycle for retail trade set
in around July 2013 and official operat-
ing environment negative inflation was
-0,91 percent by March 2014...there
were reversals in sales growth at some
locations," he said.
Overheads increased by 6,3 percent to
$69,4 million from $65,2 million prior
year. The increase in overheads was
mainly a result of increase in employee
benefit to $31 million up from $27 mil-
lion last year.
"This increase was mainly a result of
increasesinemployeebenefitsasmore
employees were engaged to man both
the new branches opened during the
year and the refurbished branches in
order to provide adequate service to
match the improved and broadened
product offering," said management.
OK Zimbabwe's total number of stores
has increased from 54 in FY2013 to 59
in FY2014.
Revenuewasupamarginal0,9percent
to $483,6 million against $479,6 mil-
lion prior year comparative. The group
said the cost of borrowing decreased
to $0,2 million from $0,8 million in
the prior year as the more expensive
Investec Africa Frontier Private Equity
Fund loan was converted to equity on
April 1, 2013.
Capital expenditure for the year was
$12,4 million, up from $12,1 million
in the prior year and was mainly in
respect of opening of new shops, store
refurbishments and replacement of old
plant and equipment. OK Zimbabwe
declared a final dividend of 0,22 cents
per share. •
Increased overheads dampen OK Zimbabwe FY2014 earnings

2. 2 NEWS
BH24 Reporter
Listed sugar manufacturer Star Africa
appears to be struggling to dispose of
its investments in Tongaat Hulett Bot-
swana and BlueStar Logistics.
In its latest update on the matter, the
company said:
"Earlier efforts to dispose of THB and
BSL, as reported in previous updates,
have not yielded the intended results
as the prospective purchasers failed to
raise the funds thereof."
The disposal of Tongaat Hulett Bot-
swana and BlueStar Logistics was
initially targeted to be completed
by February 28 after a Scheme of
Arrangement between Star Africa Cor-
poration Limited and its lenders and
creditors was sanctioned by the High
Court in August last year.
But latest indications from the group
point to earlier interested buyers hav-
ing turned their backs on the deals.
Star Africa has said "fresh efforts were
then made to approach other prospec-
tive purchasers."
In an update today, Star Africa said two
prospective purchasers are carrying
out due diligence on BlueStar Logistics.
"Itmustbepointedoutthatwhilethere
is interest on the local market for this
asset, the liquidity crunch obtaining in
the economy is militating against an
expeditious disposal thereof," said Star
Africa.
"A prospective purchaser is in the pro-
cess of conducting due diligence on this
asset, with cooperation from Starafrica
and the other shareholders in THB.
Scheme members will be advised of
progress on this transaction in the next
update.
This is a good asset, whose disposal
must yield maximum value, hence the
need to allow due process in respect
of its disposal," said the group of its
investment in Tongaat Hullet Bot-
swana.
Meanwhile, the sugar producer says
significant progress has been made on
the plant upgrade at Gold Star Sugars
Harare.
"All 47 containers have been shipped
of which 41 containers have been
delivered at Harare Refinery and the
balance will be delivered to site within
the next 7 days. Installation of the new
equipmentisongoingandis95percent
complete," said the company. •
Star Africa struggling to sell investments
Tongaat Hullet fields

3. BH24

4. BH24 Reporter
Zimbabwe has so far sold tobacco
worth $582,8 million as the 2014 sell-
ing season target of 180 million kilo-
grammes has been exceeded.
Latest figures from the Tobacco Mar-
keting Industry Board (TIMB) show
that the country has to date sold 183,2
million kgs of the golden leaf.
This reflects a 31,7 percent positive
variance from last year's prior compa-
rable period figure of 139 million kgs.
But the value sold to date is only 13
percent up from last year's $514,8
million. This is largely due to prevail-
ing lower prices, which are 14 percent
down from last year.
The contract floors continue to dom-
inate trading, with 136,2 million kgs
worth $453 million having been sold.
Theauctionfloorshavepurchased46,9
million kgs to the value of $129 million.
Tobacco is one of Zimbabwe’s major
agricultural exports, accounting for
10,7 percent of gross domestic prod-
uct.
The agricultural sector is expected to
grow by 9 percent and the continued
growth of the tobacco sector in particu-
larbodeswellforthebroadersector. •
4 NEWS
Zim may introduce empowerment levy on foreign companies
Tobacco target exceeded
Zimbabwe may introduce a levy on
foreign and white-owned companies
to pay for the training of unemployed
black Zimbabweans, Indigenisation
Minister Francis Nhema said.
The southern African nation has said its
law on local ownership, which requires
companies to sell or cede 51 percent
of shares to black Zimbabweans, may
soon be amended to encourage invest-
ment into the cash-strapped country.
“The emphasis has to do with training
of our people by companies,” Nhema
said by phone today from the capital,
Harare. “This will assist the unem-
ployed and those who did well at
school.”
The ruling Zimbabwe African National
Union-Patriotic Front’s politburo met
this week to order Nhema to make the
indigenisation law “less confusing and
more attractive” to investors, Informa-
tion Minister Jonathan Moyo said June
4. ‘Investors Happy’ “Right now inves-
tors are happy with what we’re doing,”
Nhema said. “The response from
investors has been good -- a greater
understanding of what we’re trying to
achieve.”
Miners including Anglo American Plat-
inum, Impala Platinum Holdings Ltd
and Aquarius Platinum Ltd have indi-
cated to the government they will com-
ply with the 2010 law and give some
shares to community trusts.
“I’m not ready to discuss the finer
details yet, but non-exploitive indus-
triesoutsideminingandagriculturecan
negotiate the percentage they allocate
to indigenous Zimbabweans,” Nhema
said.
That would leave lenders such as Bar-
clays Plc and Standard Chartered Bank
Plc free to negotiate levels of local own-
ership, University of Zimbabwe econ-
omist Tony Hawkins said May 29. —
Bloomberg •

5. • The FAO Food Price Index aver-
aged 207.8 points in May 2014, down
2.5 points (or 1.2 percent) from April
and nearly 7 points, or 3.2 percent,
below May 2013. After rising to a ten-
month high of 213 points in March, the
Index fell in April and again in May,
pressured by lower dairy, cereal and
vegetable oil prices. However, sugar
made strong gains in May, while meat
remained firm.
• The FAO Cereal Price Index aver-
aged 204.4 points in May, down 2.4
points (or 1.2 percent) from April and
30 points (or 13 percent) below last
year.
ThedeclineinMaywasmostlytriggered
by maize prices, which fell in response
to favourable growing conditions and
goodsupplyprospectsin2014/15.Rice
prices were little changed.
However, wheat prices, which had
firmedatthestartofthemonthonslow
springplantingintheUnitedStatesand
tensionsinUkraine,declinedduringthe
second half of the month, with weather
conditions improving in the United
States and shipments from Ukraine
continuing normally.
• The FAO Vegetable Oil Price
Index averaged 195.3 points in May,
down 3.7 points (or 1.8 percent) from
April, reflecting lower quotations of
palm, soy and rapeseed oils.
Palm oil prices fell for the second con-
secutive month on rising output in
Southeast Asia, continued strength
in Malaysia's currency and subdued
globalimportdemand.Thesofteningof
soy oil was caused by strong soybean
crushing in South America and initial
forecasts of an ample global soybean
crop in 2014/15.
The drop in rapeseed oil prices mainly
stemmed from an improvement in
global export availabilities and the
prospect of a record harvest in the EU.
• The FAO Dairy Price Index aver-
aged 238.9 points in May, represent-
ing a second sharp monthly fall, and a
decline of 12 points (or 5 percent) over
April. The market for dairy commodi-
ties is readjusting, following a period of
exceptionally high prices in 2013 and
early 2014, caused by limited export
supplies.
In recent months, the production out-
look has improved and, in general,
buyers are purchasing only for imme-
diate needs, in the expectation that
prices may fall further; consequently,
average prices for all commodities
declined during the month.
• The FAO Meat Price Index aver-
aged 189.1 points in May, nearly
unchanged from April, as prices of all
the products that make up the index
moved little.
Concerns that export supplies of pig-
meat might be constrained by an
outbreak of Porcine Epidemic Diar-
rhea virus in the United States appear
to have been allayed as prices for
this product registered only a slight
increase. Ovine meat prices are mov-
ing seasonally higher, as the production
year draws to a close in Oceania.
• The FAO Sugar Price Index aver-
aged 259.2 points in May, up 9.3 points
(or 3.7 percent), from April. Prices rose
amid early forecasts for the 2014/15
season pointing out to a possible pro-
duction deficit, with El Nino weather
likely to exacerbate the fall in output.
Overall, the price increase was more
pronounced during the first half of the
month, while in the second half, the
price rally was somewhat subdued by
indications of large sugar inventories in
India and Thailand. — FAO •
5 AGRICULTURE
May FAO Food Price Index in FULL

6. The National Social Security Author-
ity has been given the green light to
attach Tetrad Bank property to recover
nearly US$5 million owed to it by the
embattled bank.
The bank, which is reeling under a seri-
ous liquidity crunch, has been failing to
service its loans with many creditors.
Last week, High Court judge Justice
Happias Zhou granted a default judg-
ment against Tetrad Bank after it failed
to defend the claim.
He ordered that properties belonging
to 10 companies that had given surety
mortgage bonds to NSSA in respect of
their immovable properties in Harare
be attached. “The first and eleventh
defendants be and is hereby ordered to
pay the sum of $4 988 564 29 together
with interest thereon at the rate of 7
percent per annum with effect from
11 September 2013 up to date of pay-
ment in full and such interest being
capitalised monthly,” reads part of the
order.
“The immovable properties situated in
the district of Harare, which properties
aredescribedintheschedulehereto,be
and hereby declared especially execut-
able.” NSSA had sued the bank along
with 10 other companies that acted as
guarantors for the loans advanced to
the troubled-financial concern.
NSSA general manager James Matiza
represented the company and in his
papers stated that sometime in Sep-
tember last year, NSSA and Tetrad
Bank entered into a verbal agreement
in terms of which the company granted
loans amounting to $953 000.
According to the agreement, interest
would accrue on the loans at the rate
of 7 percent per annum and such other
rates and interest applied by NSSA
from time to time being capitalised on
monthly balances. It was also agreed
that Tetrad would be liable for the val-
uation and bond registration fees. “The
loans were advanced subject to the
plaintiff’s special and general lending
conditions,” said Matiza. “They would
be repaid on monthly dates between
October2013andNovember2013and
in the event of default in paying install-
ments due, the full sum of the out-
standing would automatically become
due and payable.”
Matiza stated that the 10 companies
whose properties would be attached
passed surety mortgage bonds to
NSSA of immovable properties as
security for the loans. “The second to
eleventh defendants guaranteed the
repayment of these loans as sureties
and co-principal debtors with the first
defendant,” he stated. After the bank
reneged on its obligation to settle the
loans, Matiza said, NSSA issued sum-
mons in a bid to force it to repay, but
nothing materialised. —Herald •
NEWS6
NSSA gets green-light to attach Tetrad Bank property

7. BH24

8. Qatar Airways will soon introduce
flights to Harare, initially flying into
Zimbabwe three times a week, the
new envoy from the oil rich country
said on Thursday.
Qatar’s new ambassador to Zimba-
bwe Salem Al- Jaber told journalists
soon after presenting his credentials
to President Robert Mugabe at State
House that the move was part of a
number of business ventures his
country was prepared to bring to
Zimbabwe.
“We are looking forward to bringing
Qatar Airways soon because Qatar
Airways as you know, is a big airline.
Last week we opened the biggest air-
port in the Middle East,” he said.
“We have 10 flights a week to Johan-
nesburg and we would like to extend
it from Johannesburg to Harare at
least three flights a week initially and
then later on maybe as a direct flight.”
Qatar Airways is the state-owned flag
carrier of Qatar, headquartered in the
capital Doha. Founded in 1993, it is
one of the world’s leading five-star
airlines, flying to over 125 destina-
tions in six different continents using
a fleet of more than 100 aircraft.
The airline has more than 30 000
staff, with 17 000 people employed
directly and a further 13 000 in its
subsidiaries. Qatar Airways joins a
host of other airlines that have intro-
duced or resumed flights to Zimba-
bwe including Air Namibia, Emirates,
KLM and Mozambique’s LAM.
Other airlines have also shown
renewed interest to fly into Zimba-
bwe including Air France, Swiss Air,
Bulgarian Airlines and Lufthansa of
Germany. In 1996 Zimbabwe had
45 international carriers servicing the
country.
The renewed interest in Zimbabwe’s
aviation industry is mainly as a result
of the demise of Air Zimbabwe which
has suspended most of its regional
and international routes due to via-
bility challenges and an inadequate
fleet. —New Ziana •
8 NEWS
Qatar Airways to introduce flights to Harare

9. The local equities market has closed
the week on a bullish trend that has
seen it ganing for 11 consecutive days.
The positive run is being driven by
selected heavyweights that continue to
rally. The trend continued today push-
ing the Industrials Index up 1.54 points
(or 0.87 percent) to 178.58 points.
Week on week the industrial index
pushed up 3.69 points (or 2.11 per-
cent).
Hippo led the top risers, gaining 10
cents to trade at 65 cents, while
cement manufacturer PPC inched up
by 2.50 cents to 215.70 cents. Giant
telecoms Econet gained 0.85 cents to
close at 69 cents, while another heavy-
weight Innscor increased by 0.44 cents
to settle at 73.50 cents. Fidelity Life
wasup0.52centtocloseat7.52cents,
while SeedCo bumped 0.50 cents to
trade solid at 73 cents.
Two industrial counters traded in nega-
tive territory compared to the nine that
rallied. Dairibord eased 0.30 cents to
settle at 8.20 cents and ZHL lost 0.15
cents to 0.75 cents.
In minings, Bindura added 0.10 cents
to trade at 2.60 cents to push the Min-
ing Index up 0.90 points (or 2.38 per-
cent) to close at 38.69 points. Falgold,
Hwange and Riozim all maintained
previous trading levels. On a week-on-
week basis, the Mining Index gained
3.25 points (or 9.17 percent). —
BH24 Reporter •
9 ZSE REVIEW
Equities close week on eleventh straight gain

10. Nigeria did it. And it is now stands as
Africa's largest economy.
The benefits are immense, not least
theattractionofforeigninvestorswhich
Zimbabwe urgently requires at this
present time.
We were stirred by a recent analytical
article by Perry Munzwembiri who pos-
tulates that African countries can ben-
efit from re-benchmarking their Gross
Domestic Products statistics.
He writes: When Ghana revised its
Gross Domestic Product (GDP) fig-
ures in 2010, the resultant 60 per cent
jump in its GDP estimates saw it being
upgraded from low-income country to
a lower-middle income country. Simi-
larly, Guinea Bissau and The Gambia
also discovered that their economies
weremorethandoublethesizeofwhat
had previously been reported after
embarking on exercises to recalculate
their GDP statistics. Perhaps more pro-
nounced was the giant 89 percent leap
by Nigeria to the title of Africa's biggest
economy (with a GDP of around $510
billion) after rebasing its GDP figures in
April of this year.
The numerous examples of economy
re-basing on the continent point to
possible benefits for the country. But
let's look at the merits for Zimbabwe.
Zimbabwe’s current GDP estimate
is even lower than that of Zambia, a
country that is historically economically
smaller than Zimbabwe.
But more empirically, local economists
say judging from the revenue buoy-
ancy that may be inferred from current
GDP figures the country's economy
may be understated.
Revenue buoyancy is the ratio of rev-
enue to GDP, while ‘GDP’ represents
the total market value of all final goods
and services produced in a country in
a given year. On current GDP figures
for Zimbabwe, the country’s revenue
buoyancy is estimated to be around 30
percent.Suchafigureisrathertoohigh
for the country considering the exten-
sive informalisation of its economy.
Analysts at ZB Financial Holdings say
the number of workers going into infor-
mal employment will continue to rise
and the tax base will resultantly shrink,
although the Government is earmark-
ing to increase its tax base by taxing
the informal sector. With the economy
almost being driven by the informal
sector, Zimbabwe's revenue buoyancy
should be much lower.
And this veritably points to our GDP
being understated. In 2010, Botswa-
na-based financial services company
Imara raised similar concerns around
the International Monetary Fund’s
projections of Zimbabwe’s GDP of $5
billion. “We remain totally unconvinced
and further don’t believe that the
underlying number used for the econ-
omy, being US$5 billion, is correct,”
then Imara Asset Management (Zim-
babwe) chief executive John Legat had
said at the time. Zimbabwean fiscal
authorities seem to confirm a lack of
conviction on their part on GDP figures
that have been thrown around as this
has shifted over the years without ade-
quate justification.
For example, in the 2012 national
budget the Government revised
upward the size of the economy from
$3,5 billion to $5,1 billion but with
barely a corresponding uplift in the
growth rate. Furthermore in the 2011
national budget, the then Minister of
Finance Tendai Biti gave a re-rating of
the GDP of up to $8 billion. The sim-
ple reason for this is that our GDP base
maybesimplyoutdated,andre-basing
could take us a long way. •
10 BH24 COMMENT
Should Zim consider re-basing its economy?

11. South Africa's rand was largely stable
against the dollar on Friday as growing
concerns about the health of the local
economyoffsetboostfromagenerallya
risk-positive global environment.
The local unit briefly retreated after cen-
tral bank data showed South Africa's
gold and foreign exchange reserves
were slightly lower in May compared
with the previous month.
The rand struggled to keep the previous
day'smomentum,whenitsnappedfour
days of losses after the European Cen-
tral Bank eased monetary policy, boost-
ing demand for high yielding emerging
markets. By 0655 GMT the rand was
trading at 10.6935 to the dollar, little
changed from its close at 10.6950 in
New York on Thursday.
The risk of a sovereign credit down-
grade next week and the possibility
of more widespread industrial action,
should keep the rand under pressure,
Barclays Africa said in a note.
Fitch and Standard and Poor's are due
to release their latest credit reviews on
South Africa on June 13, with analysts
expecting downgrades after the econ-
omycontractedinthefirstquarterofthe
year, hit by a crippling platinum strike.
"There is a risk that this afternoon's
U.S. employment report could prove
stronger than expected, and the rand
could lose more ground into the week-
end if this report does surprise to the
upside," Barclays Africa added. Unlike
the rand, government bonds were still
on a firm footing after Thursday's post-
ECB rally, pushing yields lower. —Reu-
ters •
11 REGIONAL News
South Africa's rand vulnerable, could weaken on U.S. jobs, credit ratings

12. 12 DIARY OF EVENTS
The black arrow indicate level of load shedding across the country.
POWER GENERATION STATS
Gen Station
6 June 2014
Energy
(Megawatts)
Hwange 384 MW
Kariba 750 MW
Harare 43 MW
Munyati 24 MW
Bulawayo -- MW
Imports 105 MW
Total 1306 MW
11 June - Rainbow Tourism
Group 15th Annual General
Meeting of the Shareholders,
Place: Jacaranda Rooms 2 and 3
at the Rainbow Towers Hotel and
Conference Centre, 1 Pennefather
Avenue, Harare, Time: 12:00
13 June 2014 - Securities and
Exchange Commission of
Zimbabwe 2nd Shareholders
Forum & Responsible Invest-
ing in Zimbabwe Conference
2014 Place : Cresta Lodge,
Harare, Time : 8am -2pm
26 June - Masimba Holdings
Limited Thirty-Ninth Annual
General Meeting of Mem-
bers for the period ended 31
December 2013, Place: 44 Til-
bury Road, Willowvale, Harare,
Zimbabwe, Time: 12:00
THE BH24 DIARY

13. BH24

14. 14 zse
ZSE
Movers CHANGE Today Price USc SHAKERS Change TODAY Price USc
Turnall 20.00% 2.10 ZIMRE -16.67% 0.75
Hippo 18.18% 65.00 Dairibord -3.53% 8.20
Fidelity 7.43% 7.52
BNC 4.00% 2.60
OK Zimbabwe 2.27% 18.51
Cottco 1.25% 0.81
Econet 1.25% 69.00
PPC 1.17% 215.70
SeedCo 0.69% 73.00
Indices
Index Previous Today Move Change
Industrial 177.04 178.58 +1.54 points +0.87%
Mining 37.79 38.69 +0.90 points +2.38%
Stocks Exchange

15. 15 AFRICA StockS
Botswana 8,664.65 -11.96 -0.14% 12July
Cote dIvoire 246.37 +2.18 +0.89% 07Mar
Egypt 7,949.60 -75.68 -0.94% 06Mar
Ghana 2,324.35 +5.23 +0.23% 02June
Kenya 4,881.56 -13.57 -0.28% 30May
Malawi 12,662.47 +0.00 +0.00% 07Mar
Mauritius 2,074.51 -3.51 -0.17% 07Mar
Morocco 9,544.10 +21.01 +0.22% 07Mar
Nigeria 41,502.00 +27.60 +0.07% 02June
Rwanda 131.27 +0.00 +0.00% 24Oct
Tanzania 2,018.97 +25.40 +1.27% 07Mar
Tunisia 4,624.39 -39.32 -0.84% 07Mar
Uganda 1,503.90 +0.81 +0.05% 10Sep
Zambia 4,242.74 +14.95 +0.35% 10April
Zimbabwe 174.91 +0.02 +0.01% 02June
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 —"Many hands
and hearts and minds
generally contribute to
anyone's notable achieve-
ments." — Walt Disney
Globalshareholder.com
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16. 16 INTERNATIONAL NEWS
Peripheral euro zone bond yields at new lows after ECB stimulus
Money and oil: Will the ECB rate cut hurt oil prices?
Lower-rated euro zone government
bond yields fell to fresh record lows
on Friday, as markets were buoyed
by another wave of European Central
Bank stimulus to fight the threat of
deflation and prop up the bloc's fragile
economic recovery.
Italian, Spanish and Irish bonds led
the way in a rally that stretched across
all euro zone government debt, with
traders citing the ECB's measures on
Thursday aimed at promoting bank
lending in some of the continent's most
vulnerable economies. Italian 10-year
bond yields opened 8 basis points
lower at 2.87 percent, Spanish equiv-
alents opened 7 bps lower at 2.76 per-
cent and Irish yields fell 7 bps to 2.51
percent.
The yield on 10-year German bonds,
the benchmark for euro zone borrow-
ing, opened 3 bps lower at 1.33 per-
cent. — Reuters •
The ECB has taken the boldest step
imaginable by adopting a deposit rate
of -0.1%, the first time apparently that
any central bank has gone to negative
interest rates.
Although there are no fears of soft-
ware crashes as in the famed Y2K
catastrophe, there could be some con-
sequences for oil markets. (Rumors
that depositors will have to give tellers
toasters are unfounded.)
Most important, a weaker euro can
be expected (it is down about 3%
from recent highs against the dollar),
which theoretically would mean pres-
sure on oil prices, since the stronger
dollar means more revenue (or more
valuable revenue) for OPEC and other
exporters.Thisdoesnotoccurformally,
with members adjusting prices accord-
ing to currency shifts, but reflects indi-
rectly the price they desire.
The connection, though, is indirect and
primarily in the perceptions of traders.
OPEC has done little to alter prices
since the collapse in 2008, and has
been content to watch them fluctuate
in a fairly narrow range the past few
years. However, traders might sell oil
in consequence of expectations for a
stronger dollar.
It is hard to resist being snide, but to
the question: is the value of the dollar
and the price of oil linked? the appro-
priateansweris,“Yes,whenitis,other-
wise, no.” There are significant periods
where the two move together, albeit it
opposite directions, but other events
often overwhelm the influence.
Most specifically, any sign of weaken-
ing oil demand in the US, which might
be a forerunner to a weaker economy,
could trigger a correction in oil prices,
which are quite high despite robust US
oil inventories.
Demand of late has been strong and
that, combined with ongoing geopolit-
ical difficulties, has kept prices above
$100. But one of the first laws of mar-
kets is: things change. — Forbes •

17. By Andrew Robinson
Zimbabwe is never far from the head-
lines of South African newspapers. This
is understandable. We have close ties to
our northern neighbour and SA has pro-
vided a home to fleeing Zimbabweans,
both white and black, for decades.
That there are highly complex political,
economic and social problems in Zimba-
bwe is beyond doubt.
But while Zimbabwe’s past will shape its
future, it need not define it. I, for one,
see the country as a slumbering giant
abouttoawakenandIbelievethatwhen
it does, it will rocket into a new era of
prosperity that will fundamentally rede-
fineourregion.Thisisn’tsomethingIam
sayinglightly.Iamnotshoutingtheodds
from the sidelines safe in the knowledge
thatifIamwrongIhavenothingtolose.
I head up a group of private-sector
investors who are looking over the year
to inject more than $100 million into
Zimbabwe. I cannot disclose the details
of the deal as it is at a sensitive stage,
but this substantial investment is being
made on the basis that the returns are
there to be made and that we will be
able to get the money out of the country
againwhenandifweneedto.Wedonot
for a second ignore the downside risks,
which include political uncertainty, liquid-
ity challenges and very high real interest
rates on short-term credit, ballooning
public-sector wage bills, ailing infrastruc-
ture and an unreliable power supply.
Rather, we put more stock in pent-up
demand, an educated population,
increasingly pragmatic policy makers
and wonderful commercial opportunities
— not only is much of the land lying fal-
low,sotooistheindustrialinfrastructure.
We are taking a long-term view. History
has shown that entrepreneurs make
their money when everyone is running
and we believe that, as investors, now is
the time to be getting in.
I have visited Zimbabwe more than 44
times in the past 18 months and what
I see is different from what the media
are communicating. The reality is that
the country has all the underlying com-
ponents of a healthy economy. While its
human and physical capital have been
degraded over the past 20 years, I have
seen a rising corps of sensible, educated
and ideologically pragmatic business
people, bureaucrats and politicians com-
ing through. Take the case of the policy
on indigenisation. The latest elections
were fought around a campaign of indi-
genisation, resource nationalism and job
creation.Promisesweremadethatlocals
would be protected from, and preferred
to, foreigners. Certain sectors, such as
retail,weredemarcatedasbeingentirely
forlocals,whileothers,includingfinancial
services and banks, were to be majority
owned by black Zimbabweans.
In March, new Indigenisation Minister
Francis Nhema went out of his way to
saytherewouldbenomoderationofthe
indigenisation drive under his watch. His
appointmenthadbeenseenasindicating
there would be some. However, he later
said the government would be prepared
to be more flexible with banks if they
agreed to lend more to local businesses.
There is also increasing contact between
the state and the Commercial Farmers
Union, which represents the remnants
of the once vibrant white farming com-
munity, and real partnerships between
the state and farmers that will restore
the country’s "breadbasket" label are
becomingpossibleagain.Thesetalkswill
probably not see title deeds returned to
farmers,butcouldseethembackonthe
land with the security of tenure needed
torecapitalisetheindustryandreturnthe
land to large-scale farming.
I am also heartened by the appointment
of the former CE of banking group CBZ
Holdings, John Mangudya, as gover-
nor of the Reserve Bank of Zimbabwe.
Becauseofhiscommercial-bankingped-
igree, he will be the right man to steer
monetary policy.
The creation of a stable, understood and
consistent investment environment and
a reinvigorated agricultural sector will
give Zimbabwe the boost it needs if it
is to reindustrialise and grow employ-
mentagain.Downsiderisksundoubtedly
remain and, in investing as in life, there
are no guarantees that things will work
out the way we predict. But we believe
that a positive outcome is far more likely
than a negative one — and we are bet-
ting heavily, using our own money, on
being right about this. — BDLive
• Robinson, an entrepreneur and
private equity investor, is CEO of
Siand.•
17 Analysis
Zimbabwe has all elements of a healthy economy