By Tawanda Musarurwa

HARARE – Mobile telecom-munications giant Econet Wireless says it is working on enhancing its tap and go payment system to be able cater for airtime vending in view of a pending ban on airtime vouchers.

Last December Environment, Water and Climate Minister Oppah Muchinguri-Kashiri urged mobile telecommuni-cation companies to adopt electronic recharging sys-tems

CEO Douglas Mboweni said the company was working on a number of strategies - including the tap and go payment facility - that would

ensure that the company’s 25 000 airtime vendors would not be left stranded by the ban.

“We need to be able to ensure that the 25 000 airtime vendors are able to dispense electronic vouch-

ers. Currently we have 4 000 vendors sampling it out but we stil l need to build a perfect eco-system around

News Update as @ 1530 hours, Wednesday 11 May 2016

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Econet to introduce electronic airtime vending system by June

Mr Mboweni

it. Another option is to have such a facility (electronic air-time vending) on our Ecocash platform.

“But in respect of all these developments they have to be done in a phased approach because many people’s lives depend on it. These are the submissions that we made to both the Postal and Telecommunica-tions Regulatory Authority of Zimbabwe (POTRAZ) and the Environmental Manage-ment Agency (EMA),” said Mr Mboweni.

The CEO was speaking dur-ing a tour of the company’s headquarters in Harare by the Parliamentary Portfolio Committee on Youth Develop-ment and Indigenisation this morning.

Econet’s tap and go payment system (more commonly known as Ecocash Ta!) was launched earlier this year.

It uses technology called Near Field Communication,

which enables the firm’s cli-ents to tap their cell-phone against a merchant or ven-dor’s enabled micro point of sale device and the value of the transaction will be auto-matically deducted from the client’s Ecocash account.

Added chief operating officer Mr Fayaz King: “The tap and go facility is already in play,

but we also need to improve the latency (speed of trans-action) of the facility, say for instance when a person who is driving wants to purchase airtime.

“Basically we are re-in-venting the business model around airtime vending. We are targeting to rollout the new solution by June.”●

2 NEWs

Minister Oppah Muchinguri-Kashiri

BH243

BH244

By Funny Hudzerema

HARARE -The People’s Own Savings Bank (POSB) recorded a 52 percent jump in profits to $7,91 million inthe year ended December 31, 2015, up from $1,25 million in the prior year due to effective utilisa-tion of existing products to earn revenue.

POSB acting general manager finance and administration Ms Maria Gunde told share-holders that the favorable performance was a result of effective utilisation of existing products to earn revenue and effective cost optimisation initiatives.

“The profit was derived by a number of initiatives which the bank introduced during the year and the reduction of non-performing loans,” she said.

Total net interest income for bank during the period increased by 27 percent to

$9,5 million from $7,5 million the prior year due to growth in lending business and an increase in lending interest income which grow by 57 percent.

Chief executive Admore Kandlela said the group was targeting a profit of $4 million profit but they got more than that through different initia-tives the bank introduced.

“The targeted profit was $4, million, but we ended up at $7,91 million and if it wasn’t for the provision of $2,2 mil-lion relating to the Zimpost debt, profit could have been at $10 million,” he said.

He said the Bank has since engaged Zimpost’s parent Ministry of ICT to have the debt secured with assets.

The loan book grew 26 per-cent to $71,091 million from $56,304 million in 2014 and Mr Kandlela said the growth in loan book was due to a 42

percent increase in individual loans.

The group also declared a dividend of $1,7 million to its shareholders. Mr Kandlela said the bank’s capital level is currently at $33 million and this follows a capital injec-tion from the shareholder of $12,28 million in the form of 10 year treasury bills with maturity value of $20 million.

“The bank will put more emphasis on the deposit mobilisation and business development with more effort on the mass market and the small to medium sector,” he said.

The bank has since moved from manual money transac-tions to electronic with effect from March 1 this year.

During FY 2015, net interest income increased 27 percent to $9,5 million compared to $7,514 million in 2014 with the growth largely on growth

in lending business where individual lending interest income increased 57 percent.

Total income was 37 per-cent up at $32,9 million from $24,07 million in prior year.

In his remarks Finance and Economic Development Minis-ter Patrick Chinamasa said the bank has the capacity to grow considering the profit it is making and $20 million capi-tal injection through Treasury Bills.

“Last year you made a small profit when your capital position was constrained, now that you are in a more favora-ble position, we expect more in terms of creating value and as Government we are looking at other means to provide additional capital.

“In terms of creating finan-cial inclusion the bank is the best bank comparing to other banks,” he said

.●

POSB profit up 52pc

5 NEWs

BH246

BH247

By Tawanda Musarurwa

HARARE-The Government is working in partnership with the United Nations Industrial Development Organisation (UNIDO) to revive the coun-try’s pharmaceutical sector.

Zimbabwe’s struggling phar-maceutical sector is teetering on the brink due a number of challenges including unfa-vourable policies and high levels of importation of for-eign-manufactured drugs.

The Ministry of Industry and Commerce’s director responsible for enterprise development Ms Florence Makombe they were working with UNIDO to capacitate the sector to produce generic drugs, mainly anti-retrovirals (ARVs).

“The Government, in con-junction with UNIDO is working on a capacity-build-ing programme that seeks to strengthen local manufacture

of essential generic medi-cines.

“The objective of the pro-gramme is to enhance access of the poor to these drugs at

affordable prices,” she said.

She said this while appear-ing before the Parliamentary Portfolio Committee on For-eign Affairs yesterday.

Official estimates indicates that over $400 million worth of basic drugs are imported Zimbabwe annually, which is threatening the viability of local producers.●

8 NEWs

Govt engages UNIDO to revive pharmaceutical sector

BH249

BH2410

BH24 Reporter

HARARE-The Zimbabwe Revenue Authority is hoping to complete the fiscalisation process it started in 2010, which will put it in good stead to meeting its revenue collection targets for the rest of the year.

This comes as the author-ity again failed to meet its target for the first quarter of the year with

Collections coming in at $724,89 million against a target of $861,83 million

Zimra board chairperson Mrs Willia Bonyongwe some taxpayers were not paying their taxes in full, and others were not paying their tax at all and this would be partly resolved through full auto-mation that is underway.

“ZIMRA will in the second quarter enhance measures to improve taxpayer com-

pliance. It will also soon complete the Fiscalisation process it started in 2010. The old fiscal gadgets are being linked to the new and versatile Tax Management System (TMS). The TMS is being rolled out fast. “This is a smart system which collects an incredible variety of information about transac-tions and taxpayers. Already, the system has revealed some interesting insights about taxpayers, including gross understatement in the returns to ZIMRA.

“The system has also revealed a lot of businesses that have hitherto been oper-

ating outside the tax net. The reality now is that as long as one is trading in Zim-babwe, as the roll out contin-ues, it will be impossible to hide from ZIMRA. Therefore, the prudent thing to do is for all taxpayers to regularise their businesses with ZIMRA.

“Automation will, therefore, enable ZIMRA to meet its 2016 targets by Q3 or Q4 at the latest, all things being equal,” she said.

Apart from failure to automise, Mrs Bonyongwe attributed the decline in rev-enue collections to depressed economic activity and widen-ing tax debt.

Individual tax continued to contribute the most to revenue collected during the period under review at 23,10 percent followed by Excise Duty (22,13 percent), VAT on Local Sales (18,08 percent) and VAT on Imports (11,55 percent).●

11 NEWs

Zimra to expedite automation as revenue collection remain

BH2412

HARARE -The local bourse f inal ly broke a prolonged winning streak today as the mainstream industr ia l index retreated 0.13 to c lose at 107.12 points.

Two counters lost ground, namely Meik les which s l id $0,0030 to $0,0700 and Zimre Holdings shed $0,0018 to trade at $0,0160.

There were no trades in the posit ive.

Conglomerate Innscor, PPC, Wi l ldale and Zimplow were al l were unchanged at

$0,2320, $0,6500, $0,0020 and $0,0200 respect ively.

The mining index was steady

at 21.55 as Bindura, Fal-gold, Hwange and RioZim maintained previous pr ice

levels at $0,0100, $0,0050, $0,0300 and $0,1300 in that order. - BH24 Reporter ●

ZsE13

Industrials break positive run

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MOvERs CHANGE TODAy PRICE UsC sHAKERs CHANGE TODAy PRICE UsC

ZIMRE HOLDINGS -10.11 1.60

MEIKLES -4.10 7.00

INDEx PREvIOUs TODAy MOvE CHANGE

INDUSTRIAL 107.25 107.12 -0.13 points -0.12%

MINING 21.55 21.55 +0.00 POINTS +0.00%

14 ZsE TABlEs

ZsE

INDICEs

stock Exchange

Previous

today

15 DIARy OF EvENTs

The black arrow indicate level of load shedding across the country.

POWER GENERATION sTATs

Gen Station

11 May 2016

Energy

(Megawatts)

Hwange 323 MW

Kariba 285 MW

Harare 30 MW

Munyati 33 MW

Bulawayo 0 MW

Imports 0 - 300 MW

Total 1245 MW

• 18 May - ZB Building Society AGM; Place: 21 Natal Road, Avondale, Harare; Time: 12:00hrs

• 18 May - The 76th AGM of Astra Industries Limited; Place: Auditorium at Astra Park, Corner Ridgeway North/Northend Roads, Highlands, Harare; Time: 12:00hrs

• 19 May - The Fifth Annual General Meeting of Padenga Holdings Limited; Place: Royal Harare Golf Club, 5th Street extension, Harare; Time: 08.15am

• 19 May - NMBZ AGM; Place: Unity Court, Corner 1st Street Kwame Nkrumah Avenue; Time: 10:00am

• 19 May - Turnall Holdings AGM; Place: Jacaranda Room, Rainbow Towers; Time: 12:00

THE BH24 DIARy

JOHANNEsBURG- THE rand appeared calmer on Wednesday morning but stil l retained the weaker bias, even as commodity prices displayed signs of recovery after a recent wobble.

The rand moves have been fierce and erratic of late: it slid to lows of 15,37 to the dollar on Tuesday before rebounding to end the day slightly firmer.

"Sentiment is poor, but underlying fundamentals are improving," Rand Merchant Bank analyst John Cairns said in a note.

"Wall Street had its best day in two months overnight, Brent oil has bounced back to S$45 (a barrel), and risk aversion has dropped away."

Aside from fanning inflation, which may lead the Reserve Bank to raise interest rates again, the volatil ity in the currency affects corporate profits.

The economic calendar is rel-atively thin this week, with not much data on schedule to

guide the markets.

At 8.46am‚ the rand was at 15,1608 to the dollar from

15,1121 at Tuesday’s close. It was at 17,2692 against the euro from 17,1914 previ-ously‚ and at 21,9160 against

the pound from 21,8360 previously. The euro was at $1,1390 from $1,1372. - Reuters●

REGIONAl NEWs 16

Rand calmer after wild swings

BENGALURU — The US Attor-ney’s Office for the Southern District of New York is inves-tigating contracts between drug makers and companies that manage prescription benefits, according to regu-latory fil ings.

Federal prosecutors have approached at least three companies — Johnson & Johnson, Merck & Co, and Endo International — demanding information about their contracts with phar-macy benefit managers.

Pharmacy benefit managers, or PBMs, which administer drug benefits for employers and health plans and also run large mail-order pharma-cies, have been challenging the rising cost of new medi-cations.

When drugs are knocked off their formularies, patients may have to pay full price for them. PBMs often keep or dump a product depending on whether they can obtain favourable pricing.

J&J said in a regulatory fil ing on Tuesday it had received a "civil investigative demand"

seeking information about its contractual relationships with pharmacy benefit managers over some of its products from early 2006 to the pres-ent.

Merck said on Monday it had received a demand for infor-mation about contracts with, services from and payments made to PBMs in relation to migraine drug Maxalt and

erectile dysfunction treat-ment Levitra over the same period.

Endo said last week it was co-operating with such an investigation, looking into its PBM contracts for its migraine therapy, Frova.

The companies did not dis-close the name of any PBM in their respective fil ings.

Express Scripts Holding is the largest US pharmacy benefit manager, followed by CVS Health.

Merck and CVS were not immediately available for comment.

Endo, Express Scripts and the US Attorney’s Office for the Southern District of New York declined to comment.

A J&J spokesman said the company had nothing more to add to what it had already published in its fi l ing.

Last November, a US unit of Swiss drug maker Novar-tis agreed to pay $390m to settle US charges that it paid specialty pharmacies il legal kickbacks in exchange for inducing patients to refil l certain medications.

The sector has come under intense scrutiny, particularly after Canadian drug maker Valeant Pharmaceuticals International was forced to sever ties with Philidor Rx over the specialty pharma-cy’s bill ing practices.-Reu-ters ●

INTERNATIONAl NEWs 17

Drug makers face probe in US about relationships with pharmacy benefit managers

By Mike Cohen and saul Butera

MORE than two decades on from a genocide that claimed 800 000 lives, Rwanda is taking another step towards looking like the closest thing Africa has to Switzerland.

The tiny, landlocked, mountainous nation’s economy has outperformed almost all its continental peers, with annual growth averaging 7,8 percent since 2000.

Like Switzerland, which hosts the World Economic Forum (WEF) in Davos every year, it is also about to welcome delegates to the organisa-tion’s annual African gathering.

"Nurturing an attractive business environment has become more important for many African nations to sustain growth, as commodity revenue and aid inflows have fallen," Mark Bohlund, Africa economist with Bloomberg Intelligence in London, said. "Rwanda has led the way by cutting red tape, providing tax incen-tives and improving governance, which has helped overcome the disadvantages of its small size, lack of port access and limited natural resources." However, the Swiss par-

allel of Rwanda’s economic success story, furthered with a ranking by the World Bank as mainland Africa’s eas-iest place to do business, does not extend to its reputation for upholding democracy.

Civil-rights groups accuse the government of stifling opposition and have criticised a constitutional change that will allow President Paul Kagame, who has been in power since 2000 and taken credit for Rwanda’s economic success, to stand for a third term.

Tourism industry

Mr Kagame’s administration has built the tourism industry into the coun-try’s biggest foreign-exchange earner by hosting events such as the WEF and the African Development Bank’s 2014 annual meeting and luring visitors to see endangered mountain gorillas and climb volcanoes.

It has also boosted agricultural out-put and manufacturing by improving roads and electricity supply. Rwan-da’s experiences feature high on the agenda of the WEF gathering, which will focus on how African countries can harness technology and knowl-

edge to spur growth.

"The slump in energy and commod-ity prices has demonstrated the urgent need for greater diversifica-tion and entrepreneurship across Africa," said WEF’s head of Africa, Elsie Kanza. Rwanda "stands as a good example of how long-term planning and savvy investing can lead to sustainable and inclusive growth". Mr Kagame led the rebel army that ended the 100-day killing spree in 1994 that targeted minority Tutsis and moderate Hutus.

He was cleared to stand for re-elec-tion next year, after more than 98 percent of people who voted in a referendum backed a constitutional amendment to extend presidential term limits. Opposition parties have very little scope to function freely in Rwanda, while the government imposes tight restrictions on freedom of speech and its views dominate the domestic media, Human Rights Watch said in its 2016 global review.

The New York-based group said it continued to receive information on people being held unlawfully in military custody and other unofficial detention centres.

Growth impetus

The government’s determination to maintain security and its co-ordi-nated fiscal and monetary policy should continue to provide impetus for growth and new investment, said Maurice Toriotich, the CEO of Kenya Commercial Bank’s Rwandan unit.

Foreign direct investment in Rwanda would probably rise 36 percent this year to $1,5bn, the nation’s develop-ment board said in April.

"The government has a good PR machine," Mr Toriotich said. "Investment returns continue to be attractive.”

While global economic recovery was taking longer than expected and the slowdown in China limits growth for commodity-based economies, Rwanda had decided to focus on marketing itself as a conference des-tination to support growth, Finance Minister Claver Gatete said after briefing reporters Tuesday in Kigali.

"At conferences like these, we expect to sign deals during side events in key areas like energy, science and technology," he said.-Bloomberg ●

18 analysis18 ANAlysIs

Is Rwanda Africa’s answer to Switzerland?