A digital copy of the Business News 24 (09 September 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. BH24 Reporter
Listed beverages producer, Delta Cor-poration,
has added a further 370 100
ordinary shares to the beneficiaries of its
share option scheme.
This brings the number of Delta shares
in issue from the previous 1 240 890
315 to 1 241 260 415 with effect from
today. Earlier in July, Delta Corporation
increased its shares in issue by 91 600
Email: bh24feedback@zimpapers.co.zw Feedback: bh24admin@zimpapers.co.zw
under the same scheme.
A share option scheme allows employees
to buy shares in their employer at below
market value. It can also be used as a
possible measure to avoid income tax on
what is effectively a benefit in kind – that
is, the difference between the buying
price and the market price. Last week
Delta chief executive Pearson Gowero
told the Parliamentary Committee on
Indigenisation and Empowerment that
the company is 33 percent indigenised
and Zimbabweans need to buy another
18 percent for Delta to comply with the
country’s indigenisation laws.
“The company is valued at $1,6 billion
hence indigenous Zimbabweans need
to raise a minimum of $300 million to
pay for the 18 percent that is required to
achieve 51 percent," he said. The latest
issuance of 370 100 will have some lim-ited
impact on driving that indigenisation
compliance upwards.
Delta has issued a total of 120 million
shares to staff under the share schemes
since 2009, which represents 6 percent
of the current issued shares. 50 to 60
percent of the shares are sold to cover
the purchase cost and 20 percent to
cover pay as you earn (PAYE). Delta
Corporation is one the best performing
counters on the local bourse, although its
revenue declined marginally in the full-year
to March 31, 2014.
Revenue marginally declined by 1 per-cent
from $631,2 million in the prior
period to $625,5 million against volume
losses in larger beer. Finance costs were
down from $7,5 million in 2013 to $5,7
million in the period under review.
Operating income decreased in line
with revenue whilst operating margins
improved marginally to 24,75 percent.
Profit for the year stood at $107,2 million
in the review period from $104,1 million.
Attributable earnings per share were
8,55c from 8,49c while diluted earnings
per share were 8,49c from 8,42c.
The board declared a dividend of US2,25
cents per share which was paid to share-holders
on June 7 2014, making it one
of the best paying stocks on the ZSE. •
News Update as @ 1530 hours, Tuesday 9 September 2014
Delta Corporation's share option scheme swells

2. 2 NEWS
Chinamasa to unpack China trip
Finance and Economic Development
Minister Patrick Chinamasa will tomor-row
unpack the vast opportunities
unlocked by President Mugabe’s visit
to China last month at a breakfast for
captains of industry, diplomats and the
investigating public.
The breakfast meeting is sponsored by
Zimbabwe Newspapers. President Mug-abe
led a high powered Government
delegation to explore business opportu-nities
with the emerging global giant last
month.
Double-digit mega deals were struck
during the visit, most of which targeted
infrastructure development to underpin
economic turnaround and create millions
of jobs. The Herald Business will host
the China –Visit forum under the theme
“Historic Sino- Zim Agreements –What’s
next”.
The breakfast will be held at Rainbow
Towers Hotel and will be moderated by
respected businessman and chief exec-utive
of Masimba Holdings, Mr Canada
Malanga. Other speakers include former
Confederation of Zimbabwe Industries
president Mr Kumbirai Katsande. Zimba-bwe
and China signed mega landmark
deals with the Asian giant providing
financial resources targeted mostly at
infrastructure development. The finan-cial
support will go towards economic
enablers in sectors that include energy,
roads, railway networking, telecommuni-cations
agriculture and tourism.
Infrastructure and Utilities development
is a key pillar under the economic blue-print
the Zimbabwe Agenda for Sustain-able
Socio-Economic Transformation.
The cluster focuses on rehabilitating
upgrading and building key physical as
well as social infrastructure and utilities
to give impetus to the economic turna-round.
Zimbabwe has been facing infrastruc-ture
challenges following failure to attract
foreign capital due to years of economic
sanctions imposed by the West. But
China has emerged as Zimbabwe’s polit-ical
and business partner providing criti-cal
resources aiding the economic turna-round.
Zimbabwe ranked as first in Africa
to attract Chinese foreign direct invest-ment
in 2013, luring more than $600
million covering areas such as agricul-ture,
manufacturing, construction, min-ing,
and tourism among other sectors.
Trade volumes surpassed $1, 1 billion
in 2013. The President’s trip unlocked
funding which is critical to the successful
implementations of Zim-Asset.
Minister Chinamasa signed two master
loan agreements with the China Exports
and Import bank and the China Import
Bank and the China Export and Credit
Insurance Corporation which provides
securitization framework for infrastruc-tural
and productive sectors.
The agreement with the China Exim
Bank sets up a framework for the Gov-ernment
to secure funding for projects in
the productive and infrastructural sectors
on a case by case basis. That funding will
only come from China Exim Bank.
The agreements with the China Export
and credit Insurance Corporation also
provides a securitisation framework for
infrastructure and productive projects
that can be funded by both the State and
non –State financial institutions. Only
viable projects would attract such fund-ing.
Minister Chinamasa signed another
agreement on economic and technical
co-operation on provision of emergency
food donation by the Chinese Govern-ment
to the Government of Zimbabwe
and a concessionary loan agreement for
the NetOne Expansion Phase Two pro-ject.
Other deals signed during the President’s
visit include mutual exemption of visa
requirements for holders of diplomatic
and service passports on the confirmed
minutes of the Ninth Session of the Joint
Commission that met from August 21
to 22 in Beijing ahead of President Mug-abe’s
State visit to China.
Another agreement was signed between
the Tourism and Hospitality Industry Min-istry
and the National Tourism Adminis-tration
of China on co-operation in the
field of tourism. Minister Chinamasa is
expected to detail the opportunities that
exist in relation to co-operation in infra-structure
development, tourism, mining
and construction.
Chinamasa last week told Parliament
that the Government had secured seri-ous
engagements with the Chinese to
fund bankable projects. — Herald Busi-ness
•

3. 3 news
Sugar milling industry gets wage increase
BH24 Reporter
Employers and the employee represent-atives
in the sugar milling sector have
agreed to a wage increase effective April
1, 2014.
The sector's new minimum wages which
will be in effect until March 31, 2015.
The collective Bargaining agreement,
which is contained Statutory Instrument
133 of 2014 reads:
"Memorandum of Agreement is hereby
made and entered into, in terms of
section 79 of the Labour Act (Chapter
28:01), between the Zimbabwe Sugar
Milling Employers Association on the
one hand and Zimbabwe Sugar Milling
Industry workers on the other hand.
"Now, therefore, is hereby agreed that
the following agreement entered into by
the employers and the employees: that
with effect from 1st April, 2014, through
to 31st March, 2015, the wages of all
employees whose grades are listed in
the wage schedule below be increased
as indicated."
Across the grade differentials, A1
employees will now be earning a mini-mum
wage of $170, up from $160.
A2 workers will now be earning $186,98,
up from $175,98, while A3 workers
will now be earning $205,67, up from
193,57.
The new monthly wage for those in the
B1 category has risen to $257,04, up
from $241,92, while those employees in
the B2 category will be earning $282,86,
up from $266,22. B3 category employ-ees
will be earning $311,11, up from
$292,81.
In the B4 category, workers will now
earn $388,96, up from $366,08, while
the highest earners (B5) category are
now earning $427,71, up from the previ-ous
minimum wage of $402,55.
The parties also agreed that in instances
where an employer is unable to provide
accommodation, an accommodation
allowance of $13,91 will be paid as from
the effective date. •
Zim, DRC can dominate global tantalite market: Mines Minister
BH24 Reporter
Zimbabwe and the Democratic Republic
of Congo can have influence over the
tantalite market if they work together, an
official said recently.
Addressing members of the Senate last
week, deputy minister of Mines and Min-ing
Development Fred Moyo said the
country could benefit greatly from the
tantalite market.
“It may be of use for Senators to realise
that 80 percent of the world’s tantalite is
produced between Zimbabwe and the
Democratic Republic of Congo.
If those two countries were able to put
their thoughts together, they would have
maximum influence over the tantalite
market which is the mineral that pro-duces
computers and cellphones,” he
said.
Tantalite was discovered in Seke com-munal
lands and the deposits are also
mined in Marondera, Mberengwa, Mure-hwa,
Mutoko, Masvingo, and Buhera.
The mineral is often smuggled to the
DRC for sale.
Tantalite is a heavy black mineral which is
found in granite rocks and mostly used in
the electronics industry.
It is used for the manufacturing of elec-tronic
capacitors for cell-phones and lap-top
computer chips, among others.
Due to worldwide demand, prices for
tantalite occasionally soar to hundreds of
dollars per kilogram.
Although Zimbabwe and DRC are cur-rently
the leading producers of the min-eral
on the continent, tantalite has also
been discovered in Egypt, Namibia, Mad-agascar
and Rwanda.
It is also found in northern Europe and
some parts of the United States and Aus-tralia,
which produced about 75 percent
of the mineral as of 2006. •

4. 4 NEWS
Zimbabwe's cost of living slides as consumers adjust spending
BH24 Reporter
The Zimbabwean market has adjusted
to suit the pockets of the consumers who
have also adjusted their spending as the
economy continues to sag under the
heavy burden of liquidity challenges.
According to the Consumer Council of
Zimbabwe, consumers are now buying
basic necessities resulting in the decline
in the cost of living measured by the low
income urban earner monthly basket for
a family of six from $589,14 in July to
$586,90 in August. The decline of 0.38
percent could also be attributed to the
promotions running in some big super-markets
that resulted in the reduction of
prices on some items in the basket. The
food basket decreased by $2,56 from
$146,11 to $143,55 by end of August.
However, an increase in the price of laun-dry
bars resulted in an increase in the
price of detergents by 3.54percent from
$9.03 to $9.35. Decreases in prices were
recorded in meat which went down by
50c from $4,30 to $3,80 per kg, mealie
meal by 36c from $11,96 to $11.60 and
tea leaves by 12c from $1,87 to $1,75.
The price of tomatoes went down 10c
from 80c to 70c per kg while onions went
down by 6c from $1.05 to 99c. The price
of a 2kg of flour also declined by 5c from
$1,85 to $1,80 and bath soap by 4c from
59c to 55c.
Increases in prices were recorded in
margarine which went up by 75c from
$1,14 to $1,89, laundry bars by 12c
from $1,00 to $1,12 and salt by 1c from
19c to 20c.
The prices of the other basic commodi-ties
which include fuel, sugar, fresh milk,
cooking oil, bread, rice, cabbage and
washing powder remained unchanged
from the end July figures. •

5. BH24
AdM-DI156506-

6. 6 NEWS
University of Zimbabwe develops all-in-one organic fertiliser
By Funny Hudzerema
The University of Zimbabwe has devel-oped
new organic fertilisers that exclu-sively
utilises local resources that can
meet the plant's requirements up matu-rity.
In an interview University of Zimbabwe
vice chancellor, Professor Levi Nyagura
the new local organic fertiliser will signif-icantly
reduce the cost of fertiliser usage
in the country.
“The cost of fertiliser is now around $40
dollars due to high demand which is not
affordable to our local farmers and we
have decided to develop new organic
fertilisers which add value to our local
manure to meet the fertiliser require-ments
and it will cost $27.
“The organic fertiliser contains potash,
phosphorous and lime which are essen-tial
on the growth of plants so through
applying the organic into local manure it
will be enriching the manure into fertil-iser,”
he said.
Prof Nyagura said research is an impor-tant
factor in the development of agri-culture
and local people must trust their
researchers to reduce dependency on
other countries.
Zimbabwe currently depends on foreign
technologies in its agricultural sector
which most of the foreign products are
not suite with our climatic conditions.
UZ agriculture lecturer Raymond Nazare
said the new local organic fertilisers are
in stock which can cover all the country's
provinces.
Nazare also said Zimbabwe has an
advanced technology systems that can
assist in respect of drought and dis-aster
management, for example, but
these have not be properly utilised in the
recent past.
“Disaster management and predication
are available in our country before the
outbreak of the Tokwe Mukose floods
the researchers had noticed it before but
people do not trust our local researchers,”
he said. Experts says local technology is
very important to boost the agricultural
production and the country should look
inwards not out wards and the produced
products will be Zimbabwean. The
development of the local organic fertiliser
is said to have been started around six
years ago. •

7. BH24

8. 8 NBEHW24S

9. BH24
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10. BH24
INVITATION TO INFORMAL TENDER POSB 03/2014
for
THE PROVISION OF SYBASE/SQL DATABASE MONITORING SYSTEM
Tenders are invited from registered and established software distributors/agents to supply, install and commission a Sybase/SQL
database monitoring system for The People's Own Savings Bank of Zimbabwe (POSB).
Documents for this tender are obtainable from The Finance Office, 4th Floor Causeway Building, Corner Third Street and
Central Avenue, Harare, upon payment of a non-refundable deposit fee of US$10 per set.
Tenders should be accompanied by copies of the following documents:
 Company Profile
 Certificate of Incorporation
 C.R.14. (List of Directors)
 Contact details of at least three (3) recent traceable references of which at least one referee should be from the banking sector.
Tenders must be enclosed in sealed envelopes endorsed on the outside with the advertised tender number, description, closing date
and must be slotted in the tender box installed at the 4th Floor, reception area at Causeway Building, Corner of 3rd Street
and Central Avenue, Harare.
Closing Date: Tuesday, 7th October, 2014 at 1000 Hrs
OTMDI185207-D6

11. 11 BH24 COMMENT
A little forward planning never goes amiss
In 2011 the then Government
announced that a national infrastructure
audit was in the pipeline.
The audit would help determine Zimba-bwe’s
infrastructure status. Indications
too, at that time, were that following
the audit an infrastructure master-plan
would be formulated that would act as a
template for rehabilitation programmes.
But alas we are almost at the close of
2014, and the national infrastructure
audit is still in the pipeline and we have
to depend on external studies such as
those of the World Bank and the African
Development Bank among others.
Such sluggishness has one of the key
factors behind the lack of delivery of
new infrastructure projects and the
rehabilitation of old infrastructure.
Money is a key element, obviously. But
there is so much more than can be done
even when funds are not yet available,
for instance planning. A dilapidated
state of key infrastructure in the coun-try,
including social services can be said
to be stalling real economic growth inso-far
as the current state cannot sustain
a possible improvement in the level of
industrialisation. But what plans outside
ZimAsset have we put in place for infra-structure
development, say the funds....
or rather funding becomes suddenly
available? Because in a way it suddenly
has. Last week Zimbabwe signed mega
landmark deals with China to provide
the former with financial resources tar-geted
mostly at infrastructure develop-ment.
The financial support will go towards
economic enablers in sectors that
include energy, roads, railway network-ing,
telecommunications agriculture and
tourism.
So the question now is: do we have any
implementation matrix in place for the
projects? What are the timelines for the
conclusion of the various projects under
the energy, roads, railway networking,
telecommunications agriculture and
tourism sectors?
What is the private sector's role in
the implementation of the nine mega
infrastructure deals that the country's
authorities signed with China? And
is the private sector in line to benefit
directly from the agreement with the
China Export and Credit Insurance
Corporation that will provide a securiti-sation
framework for infrastructure and
productive projects? Because in reality
infrastructure development is not a pre-serve
for the public sector. It also only
realistic to assume that the deals inked
in China do not constitute the entirety of
Zimbabwe's infrastructure development
and refurbishment requirements.
In that case what are our priority targets
even within the afore-mentioned sec-tors?
The mega-deals we signed with
China aside, does Zimbabwe currently
have a national framework on Private
Public Partnerships (PPPs), which would
typically give much needed confidence
to potential investors going forward?
Delivering concrete outcomes in infra-structure
development requires a mul-ti-
year approach and commitment by
the country.
ZimAsset sort of addresses that issue,
but the five-year broad economic pol-icy
is not too telling on implementation
matrices.
That would have been better addressed
by a national infrastructure master-plan
that dovetails with the ZimAsset.
A masterplan would also go a long way
in negating the effects of regulatory and
bureaucratic constraints that can and
have been the biggest hurdles in the
path of infrastructure development.
With a little more forward planning on
our part, some of the questions raised
here, wouldn't be as important. •

12. 12 ZSE REVIEW
Equities extend losses
Trading on the ZSE continued on a
downward trend on the second day
of this week, dropping 0.40 percent.
The industrial index retreated by 0.80
points to close at 200.13 points in
mixed trading as some key heavy-weights
underperformed.
Giant beverages producer Delta lost
3 cents to close at 135 cents, while
conglomerate TA Holdings shed a
cent to close at 14 cents and the
cement maker PPC shed 0.51 cents
to 230 cents.
Bankers Barclays lost 0.30 cents to
3.50 cents and Zimpapers was 0.05
cents lower to trade at 0.65 cents.
The gainers included Natfoods which
led the movers with a 5 cents gain to
close at 235 cents and OK Zimbabwe
went up 0.99 cents to trade at 17.50
cents.
Giant telecoms Econet gained 0.98
cents to trade at 85 cents and NTS
was up 0.30 cents to trade at 2 cents.
The mining index was unchanged
at 98.24 points as Bindura, Falgold,
Hwange and Riozim all remained
unchanged at 8.50 cents, 4.01 cents,
8 cents and 22.50 cents respectively.
― BH24 Reporter •

13. REGIONAL News
13
Rand near month low vs dollar, investors worry about current a/c
The rand weakened to near a month-low
against the dollar early on Tues-day
as investors worried about the
health of South Africa's economy,
while the dollar enjoyed broad-based
strength.
Investors are waiting the South Afri-can
Reserve Bank's release of reams
of second quarter data in its quarterly
bulletin report at 0800 GMT.
The main focus will be the current
account number, which analysts
expect to have widened to a deficit
of 5.45 percent of GDP, from 4.5 per-cent
in the first three months of the
year.
The data is also likely to show
depressed consumer spending trends
and high household debt.
A wider current account gap high-lights
South Africa's external vul-nerability
and puts pressure on the
currency because the account is tra-ditionally
funded by portfolio inflows.
The dollar is rallying against major
currencies as investors reassess
their interest rate expectations after
a branch of the U.S. Federal Reserve
published a paper saying market
expectations of lower rates for longer
were running below those of policy-makers.
At 0640 GMT, the rand was at
10.8200, slightly weaker than its
close in New York. It has tested a ses-sion
low of 10.8300 so far, its weakest
since Aug. 8. "The market has failed
in the 10.80 – 10.88 area six times
in the past four months so resistance
will be steep but, for the first time in
weeks, there is a real risk of a break
of the range to the topside," John
Cairns, currency strategist for Rand
Merchant Bank, said in a market note.
Rand Merchant Bank will release its
RMB/BER Business Confidence Index
at 1000 GMT, which is likely to show
underlying weakness in the produc-tive
sectors of the economy. The
manufacturing and mining indus-tries
have contracted in the first six
months of this year.
The yields on the benchmark 2026
government bond rose 6.5 basis
points to 8.16 percent.
Treasury results of a weekly sale of
2.35 billion rand ($217 million) of
fixed income bonds are due after the
auction closes at 0900 GMT. ($1 =
10.8190 South African rand) — Reu-ters
•

14. 14 DIARY OF EVENTS
The black arrow indicate level of load shedding across the country.
POWER GENERATION STATS
Gen Station
9 September 2014
Energy
(Megawatts)
Hwange 644 MW
Kariba 625 MW
Harare 0 MW
Munyati 26 MW
Bulawayo 20 MW
Imports 0 MW
Total 1317 MW
Hippo Valley Estates Limited
fifty-eighth Annual General
Meeting of shareholders Venue:
Meikles Hotel, Harare, Date: 22
September 2014 Time: 1200 hours
NMBZ Holdings Limited 9th
Annual General Meeting Venue:
The Registered Office of the Com-pany
at 4th Floor, Unity Court, Cor-ner
1st Street/ Kwame Nkrumah
Avenue Date: 22 September 2014
Time: 1000 hours
Dawn eleventh Annual General
Meeting Venue: The Ophir Room,
Crowne Plaza Date: 12 September
2014 Time: 1000 hours
THE BH24 DIARY

15. 15 zse
ZSE
Movers CHANGE Today Price USc SHAKERS Change TODAY Price USc
NTS 17.64% 2.00 Barclays -7.89% 3.50
RTG 7.69% 1.40 Zimpapers -7.14% 0.65
OK Zim 5.99% 17.50 TA -6.66% 14.00
Masimba 5.49% 2.11 Delta -2.17% 135.00
NicozDiamond 3.22% 1.60 Zimplow -0.49% 6.00
Natfoods 2.17% 235.00 PPC -0.22% 230.00
Padenga 1.19% 8.50
Econet 1.16% 85.00
Indices
Index Previous Today Move Change
Industrial 200.93 200.13 -0.80 points -0.40%
Mining 98.24 98.24 +0.00 points +0.00%
Stocks Exchange

16. 16 AFRICA StockS
African stock round up Commodity Prices
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 2,205.83 +0.96 +0.04% 03Sep
Kenya 5,163.28 +0.07 +0.00% 03Sep
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 41,207.79 -56.86 -0.14% 03Sep
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 199.69 +2.28 +1.16% 03Sep
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 — "Anything
in life worth having is
worth working for." - An-
Globalshareholder.com drew Carnegie

17. 17 INTERNATIONAL NEWS
Dollar hits six-year high versus yen while bonds fall
The dollar climbed against most
peers, touching its strongest level
versus the yen since 2008, while
U.S. and European equity-index
futures fell with bonds amid specula-tion
about prospects for U.S. interest
rates. Crude oil rebounded and nickel
led metals lower.
The U.S currency bought 106.22 yen
by 7:25 a.m. in London, while the
Bloomberg Dollar Spot Index headed
for its highest close in almost 14
months. Standard & Poor’s 500 Index
futures lost 0.1 percent and Euro
Stoxx 50 Index contracts dropped 0.4
percent. Oil in New York rose from an
eight-month low. Yields on 10-year
Australian bonds advanced 11 basis
points as the rate on three-year
Treasuries moved above 1 percent
before debt auctions this week. Nickel
retreated 1.4 percent. The dollar is
cementing gains amid speculation
over U.S. interest rates, with Federal
Reserve research suggesting inves-tors
may be underestimating how
quickly policy makers could raise key
borrowing costs. Markets in mainland
China resume after a holiday today,
after data yesterday showed a sur-prise
drop in imports fueled a record
trade surplus in August. Ukraine’s
defense ministry claimed rebels con-tinued
shelling its positions in the
country’s east as the European Union
delayed additional sanctions on Rus-sia
over the conflict. “Higher U.S.
yields are fueling U.S. dollar buy-ing,”
said Naohiro Nomoto, an asso-ciate
for foreign-exchange trading
at Bank of Tokyo-Mitsubishi UFJ Ltd.
in New York. “There looks to be fur-ther
upside in U.S. yields, especially
on the long end. There is speculation
that the Fed will revise its forward
guidance at next week’s meeting.” —
Bloomberg •
Facebook Inc’s market value exceeded
USUS$200 billion (RM638.46 billion)
to put it among the world’s biggest
corporations, as investors bet on the
company to capitalize on the future of
mobile advertising.
Facebook shares rose 0.8 per cent
to US$77.89 at yesterday’s close in
New York, valuing the company at
US$201.6 billion, according to data
compiled by Bloomberg. That made
it the 22nd- largest company in the
world, behind Verizon Communica-tions
Inc. and ahead of Toyota Motor
Corp. The stock has jumped 9.3 per
cent since July 23, compared with a
0.7 per cent increase in the Standard
& Poor’s 500 Index, after Facebook
reported a 61 per cent increase in
second-quarter sales to US$2.91 bil-lion.
Mobile promotions accounted for
62 per cent of ad sales, up from 59
per cent in the prior period.
The gains are a far cry from Face-book’s
May 2012 initial public offer-ing,
when a lack of mobile revenue
led to a plunge in its stock.
Chief executive officer Mark Zuck-erberg,
the world’s 13th-richest
person according to the Bloomberg
Billionaires Index, has made ads on
smartphones and tablets Facebook’s
core business and is building on that
foundation with a mobile network to
spread the company’s ads across the
Web and wireless devices.
“This latest rally stems from their last
earnings announcement, when they
reported higher demand and sales
numbers for their mobile ads,” said
Jeffrey Sica, who oversees more than
US$1.5 billion in assets as president
of Sica Wealth Management, in an
e-mail. “If they can continue to grow
their mobile ads, they will have a sus-tainable
demand for their stock.” —
Bloomberg •
Facebook's market value tops $200 billion

18. 18 ANALYSIS
Intra-African Trade - Going beyond political commitments
By Masimba Tafirenyika
Among Africa's policy wonks,
under-performing trade across the con-tinent
within the region is a favoured
subject.
To unravel the puzzle, they reel off
facts and figures at conferences and
workshops, pinpoint trade hurdles to
overcome and point to the vast oppor-tunities
that lie ahead if only African
countries could integrate their econ-omies.
It's an interesting debate but
with little to show for it until now.
The problem is partly the mismatch
between the high political ambitions
African leaders hold and the harsh eco-nomic
realities they face.
Case in point: they have set up no
less than 14 trading blocs to pur-sue
regional integration. Yet they
have shown "a distinct reluctance to
empower these institutions, citing loss
of sovereignty and policy space as key
concerns," says Trudi Hartzenberg,
executive director at the Trade Law
Centre for Southern Africa (Tralac), an
organisation that trains people on trade
issues. As a result of this reluctance,
she says, "Regional institutions remain
weak, performing mainly administra-tive
functions."
Trade flourishes when countries pro-duce
what their trading partners are
eager to buy. With a few exceptions,
this is not yet the case with Africa. It
produces what it doesn't consume and
consumes what it doesn't produce.
It's a weakness that often frustrates
policy makers; it complicates regional
integration and is a primary reason for
the low intra-regional trade, which is
between 10% and 12% of Africa's total
trade. Comparable figures are 40%
in North America and roughly 60% in
Western Europe.
Over 80% of Africa's exports are
shipped overseas, mainly to the
European Union (EU), China and the
US. If you throw into the mix com-plex
and often conflicting trade rules,
cross-border restrictions and poor
transport networks, it's hardly surpris-ing
that the level of intra-Africa trade
has barely moved the needle over
the past few decades. Not everybody
agrees intra-Africa trade is that low.
Some experts argue that a big chunk
of the continent's trade is conducted
informally and at times across porous
borders.
Most borders, they point out, are often
poorly managed or informal trade sta-tistics
are simply not included in the
official flows recorded by customs offi-cials.
"We don't have a way of captur-ing
these types of activities because
they're informal," said Carlos Lopes,
the head of the UN Economic Commis-sion
for Africa (ECA), in an interview
with Africa Renewal.
The ECA, he explained, is planning to
plug this information gap with a more
precise picture of economic activities
in Africa and give economic planners a
better data set with which to work.
Regional economic blocs. To accelerate
regional integration, the World Bank
is advising African leaders to expand
access to trade finance and reduce
behind-the-border trade restrictions
such as excessive regulations and
weak legal systems.
Nevertheless, saddled with weak econ-omies,
small domestic markets and
16 landlocked countries, governments
believe they can achieve economic
integration by starting at the regional
level and working their way up, merg-ing
all the regional trading blocs into an
African Free Trade Area.
But with 14 different trading blocs, crit-ics
say that's just too many. Some blocs
have overlapping members and many
countries belong to multiple blocs.
Yet, the challenge is not simply the
number of trading blocs, experts say,
but their track record. Governments
need to implement their trade agree-ments.
On this score, African countries per-form
poorly despite their strong polit-ical
commitment to regional integra-tion,
notes Hartzenberg in her report,
"Regional Integration in Africa", pub-lished
by the World Trade Organization,
a global body on trade rules. - —Africa
Renewal •