A digital copy of the BH24 (19 January 2016 edition). Zimbabwe's premier business news free sheet published by the Zimpapers Newspapers Group (1980) Limited and available every week day from 15:30hrs to give a summary of the day's business news.

1. BH24 Reporters
HARARE -Industry and farmers have
rejected the proposed 49 percent elec-
tricity hike by Zimbabwe Electricity
Transmission and Distribution Company
(ZETDC ), saying the power company
should improve efficiencies.
In a joint press statement by Confedera-
tion of Zimbabwe Industries, Zimbabwe
Farmers Union, Zimbabwe Commercial
Farmers Union, Commercial Farmers
Union and the Chamber of Mines of
Zimbabwe, industry said the ZETDC
should dispense with its banking halls
and reduce headcount in various depart-
ments.
"Significantcostreductioncanberealised
within the utility itself. With prepayment
system now supposedly working , bank-
inghallscanbedispensedof.Head-office
overhead can be significantly reduced.
"Takingdepreciationandreturnonassets
(ROA) out of the revenue required, we
find that payroll costs are 32 percent at
ZPC (Zimbabwe Power Company) and
20 percent at ZETDC which we believe
shouldbereducedlikewhatishappening
in all other sectors of the economy," said
industry. Industry has also called for a
review of the electricity tariff determina-
tion model. "How relevant is the current
model of tariff determination in the cur-
rent circumstance of the Zimbabwean
economy?"
In an earlier study, University of Zim-
babwe economics lecturer Dr Takaw-
ira Mumvuma posited that the power
authority’s current pricing model has
been rendered unworkable in terms
of ensuring future infrastructure refur-
bishment by the extensive debts owed
to it by consumers. This limited finan-
cial capacity has resulted in the power
authority failing to institute significant
levels of infrastructure refurbishment
and upgrades at its power stations.
The national power utility is currently
able to provide around half of Zimba-
bwe's 2 200 megawatt (MW) electricity
requirement. It is currently dependent
on importsfromtheregioninsofarasthe
thermal plant at Hwange is using ageing
equipment, while the Kariba hydro-
power plant is facing a water shortage
challenge. The business community
dismissed the proposed 49 percent elec-
tricity tariff hike, saying both firms and
individuals are currently struggling to
pay the present tariff as evidenced by
the high debt levels.
Various consumers owe the ZETDC
around $1 billion. "We are seriously per-
turbed by the decision that was taken to
bring into the tariff equation, the emer-
gencypowerfromdieselgeneration.This
proposed 200MW emergency power is
coming at a huge cost to the economy.
"The investment by the economy in this
proposed scheme can be better utilised
if deployed to give a permanent solution
tothisenergycrisis,evenifitmeansthat
permanent energy will be realised three
to five years down the line.
"All imported power is coming from util-
ities operating in weak currencies, and
therefore we believe the cost thereof
should be low, not to cause a review of
tariffsupwards,"saidthebusinessrepre-
sentativesbodies.Theyadded:“Regional
competitiveness is under serious threat
with the currency crises in emerging/
regional economies. Strong headwinds
are also facing commodities.
“Withnomonetaryabilitytodevaluecur-
rency, there has to be internal devalua-
tion to remain competitive. This, by defi-
nition, means costs (electricity included)
has to come down”.●
News Update as @ 1530 hours, Tuesday 19 January 2016
Feedback: bh24admin@zimpapers.co.zwEmail: bh24feedback@zimpapers.co.zw
Industry, farmers reject proposed energy tariff hike

2. BH24
THOUSANDS OF PRIZES TO BE WON!
Spend $300 instore and receive a scratch card - and guaranteed prize with every card.
Visit www.tvsales.co.zw for more information Like us on facebook.com/tvsaleshome
• TERMS & CONDITIONS APPLY. E&OE. SEE IN-STORE FOR DETAILS. • WHILE STOCKS LAST • UP TO 24 MONTHS CREDIT AVAILABLE. • CREDIT APPROVAL SUBJECT
TO NORMAL TERMS & CONDITIONS. • INSURANCE & FREE FUNERAL COVER IS INCLUDED IN ALL CREDIT OFFERS, GIVING YOU COMPLETE PEACE OF MIND.
PLUS HUGE
DISCOUNTS ON HUNDREDS OF
OTHER PRODUCTS IN-STORE! JANUARY 2016’s
UNBEATABLE PRICES
RED HOT
DEALS
ARE STILL ON
ZERO DEPOSIT FOR ALL SSB CUSTOMERS
YOUSAVE
$30
YOU
SAVE $20
HURRY!
DEALSEND 31 JANUARY 2016
OR WHILE
STOCKS LAST
$699
NOW
$729
WAS
3 Door Fridge
ASTRIL Home
Entertainment Unit
$379
NOW
$399
WAS
H420 MWD Fridge
$629
NOW
YOU
SAVE $70
$699
WAS
YOUSAVE $100
Francesca JW 9pce D/R/S
$1,049
NOW
$1,149
WAS
2

3. By Tawanda Musarurwa
HARARE - The Hwange-based
RHA tungsten mine is set to
be commissioned next month,
with plans to convert it from
open-pit to underground mine
progressing .
Parent company, AIM-listed
Premier African Minerals, said
plans to access the 870 under-
ground level of the mine are
currently on track.
In view of the on-going, Pre-
mier expects to update its
resource estimate at the tung-
sten mine following the com-
pletion of an underground
implementation study.
The study, prepared by RHA
and Whaleside Shaft Sinkers
Zimbabwe, showed that the
company would need $406 000
in capital cost for underground
development.
It also confirmed that the pro-
ject schedule for equipping the
vertical shaft hoist and com-
missioning of operations on
870 level remained on schedule
for next month.
Premier chief executive Mr
George Roach said the move to
expedite the conversion of the
mine had been necessitated by
unpredicted occurrences.
"RHA was always planned,
in the longer term, to be an
underground mine. Unfore-
seen developments during the
initial open-pit operations led
the company to accelerate the
move to underground mining.
“This change in strategy
has resulted in the need to
finance company overheads
for an extended period with-
out recourse to cash flow gen-
erated from the open-pit and
finance substantial additional
debt generated by RHA,” he
said.
Mr Roach said Premier had suc-
cessfully extracted and stock-
piled ore from underground
since late November and now
anticipated RHA to generate
positive operational cash flow
during the course of this year.
According to the company, after
February, the aim is to process
approximately 32 000 tonnes of
run of mine ore at an average
grade of 6,20 kilogramme per
tonne to produce 249 tonnes of
concentrate at 63 percent WO3
over six months.
First production and positive
operating cash flow from RHA
before capital expenditure
and working capital are now
expected later this year.●
3 news
RHA tungsten mine set for February commissioning

4. BH244

5. By Funny Hudzerema
HARARE - Government says it
has stepped up efforts to explore
alternative power generation ave-
nues such as gas and wind to
curb current power shortages that
have hit the country.
Energy and Power Development
Minister Dr Samuel Undenge said
efforts are under way to exploit
gas in different areas across the
country to reduce power short-
ages.
“We have considered the use of
gas which is in Lupane we are
developing strategies to exploit it
for the benefit of the country.
“There is gas which is in Lupane
and as we speak now there is
a company which is carrying
out experimental drilling to see
whether we can fully exploit that
gas for commercial use so that we
can use it to turn the turbines to
generate electricity,” he said.
Zimbabwe discovered billions of
cubic feet of coal bed methane
gas in Lupane and financial and
infrastructure investments are
required to harness the gas.
Estimates say the country is home
to more than 40 trillion cubic feet
of potentially recoverable coal bed
methane gas which is found in the
Lupane - Lubimbi area.
“Work is underway that side and
we are expecting to get results
in some few months concerning
for how long we can use the gas
available in the area.
“Use of gas is part of Govern-
ment’s initiatives to do away with
power shortages in the country in
future.
“As Government we are also call-
ing for partnerships to look for
ways to use wind and solar to sup-
ply power to all the different areas
around the country,” he said.
He added that if these sources of
energy are fully exploited along-
side with other projects which are
underway in the coming five years
we will have enough power in the
country.
The Government is also imple-
menting a number of projects
around the country to boost
power generation projects,
including long-term projects such
as the Batoka Gorge Hydroelec-
tric Power Station, which is being
implemented alongside other
independent power producers.●
5 news
Zim eyes gas, wind as alternative power sources
02 03
ADD TO CART
Save big on selected
Products of your choice
PAYMENT
You can purchase
whenever, wherever
using:
DELIVERY
Spend $30 or more
on your purchases
and get free
delivery
01 Hello Convenience
www.hammerandtongues.com
BIG CONVENIENCE+
BIG SAVINGS+
BIG OPPORTUNITIES
= BIG HAPPINESS
SHOP ONLINE!!

6. BH246

7. HARARE – The United Nations
World Tourism Organisation
(UNWTO) has ranked Zimbabwe
as one of the top 30 countries
that have made major efforts to
reduce travel restrictions and
allow free movement of tourists
in the past seven years.
In its 2015 Visa Openness
Report released last week, the
157-member UNWTO, ranked
Zimbabwe number 29 out of
the top 54 member countries
deemed to have made signifi-
cant progress in relaxing tourist
restrictions.
“Overall, 54 destinations sig-
nificantly facilitated travel for
citizens of 30 or more countries
by changing their visa policies
from visa required to eVisa, visa
on arrival, or no visa required,”
the UNWTO said.
“These 54 destinations took
a total of 6 357 individual
measures, presenting 86 per-
cent of all improvements made
between 2010 and 2015. This
demonstrates that destinations,
when reviewing their visa poli-
cies, tend to thoroughly review
and introduce changes.”
According to the report, Zimba-
bwe implemented a total of 117
reforms that made it easy for
tourists to visit the country dur-
ing the period.
At number one was the island
country of Niue with 195
reforms followed by Micronesia,
Palau, Djibouti and the Bud-
dhist kingdom of Bhutan in the
top five.
Mozambique, which was
at number seven with 189
improvements was the top
ranked African country with
Guinea-Bissau, Togo, Cape
Verde, Rwanda, Mali, Maurita-
nia, Uganda, Kenya and Tan-
zania also among top African
reformers.
The UNTWO said the reforms
led to an improvement to the
world’s average openness in the
period.
“Prioritizing travel facilitation
is central to stimulating eco-
nomic growth and job creation
through tourism.
We are pleased to see that a
growing number of govern-
ments around the world think
likewise” said UNWTO Secre-
tary-General, Taleb Rifai.
“UNWTO recommends desti-
nations to focus in particular
in a stronger segmentation of
travellers, in improving visa
application processes and entry
procedures, in making use of
regional integration opportuni-
ties, and last but not least, on
providing precise and accessi-
ble information for tourists.”
The UNWTO hopes that increas-
ing openness will help the
number of international tourist
arrivals grow to around 1.8 bil-
lion annually by 2030.
Zimbabwe’s Tourism and Hospi-
tality Industry Minister, Walter
Mzembi has on several occa-
sions called for the lifting of
visa requirements.
Such a move, he has argued,
would allow the country to
achieve its target of attracting
five million tourists and achiev-
ing a $5 billion income for the
industry by the year 2020.
Last year, the country relaxed
the visa regime for Chinese
tourists who are now allowed to
get visas on arrival instead of
applying for them while in their
homeland.
In advocating scrapping of the
visa, Mzembi quotes the bibli-
cal prophet, Isaiah who encour-
aged nations to keep their gates
open to foreigners if ever they
intend to cash in on the visitors
wealth.Hostile western media
has battered Zimbabwe’s image
over the years, choking efforts
to boost tourist arrivals.
But the industry has largely
been resilient, and is continuing
to defy the odds.
- New Ziana●
7 news
UNWTO ranks Zim among top reformers

8. BH248

9. BH249

10. HARARE -The equities market sus-
tained a downward trend following
today's trades, on the back of prevail-
ingweakmacro-economicfundamen-
tals.
The mainstream industrial index
slipped a further 2.30 (or 2,13 per-
cent) to close at 105.86 as giant bev-
erages producer Delta lost $0,0303
to trade at $0,5803, while conglom-
erate Innscor was down by $0,0300
to $0,2100 after announcing this
morning that pursuant to the group’s
strategy of focusing on core business,
witheffectfrom January1,2016,the
group divested its interest in the six
SPAR Corporate Stores which it oper-
ated in Zimbabwe. Giant retailer OK
Zimbabwe decreased by $0,0080 to
settle at $0,0400 and Proplastics was
$0,0010weakerat$0,0230.
On the upside, Fidelity Life rose
$0,0024tocloseat$0,0974asinsurer
NicozDiamond and banker NMBZ
wereeach$0,0010upto$0,0161and
$0,0360,respectively.
Telecoms giant Econet added a mar-
ginal0,0009tosettleat$0,2010.
The mining index was again
unchanged at 21.74 as Bindura, Fal-
gold, Hwange and RioZim maintained
previous price levels at $0,0128,
$0,0050, $0,0300 and $0,1040,
respectively.
-BH24Reporter●
ZSE10
Industrials bear run continues
Peace of mind is good
www.sc.com/zw
Registered Commercial Bank
A member of the Deposit Protection Corporation
underwritten by
Standard Chartered Bank keeps you covered in more
areas than one with our array of Bancassurance products.
To get the optimum home, motor, life, funeral or business
cover, get in touch with us today.

11. BH2411

12. BH2412

13. Movers CHANGE Today Price USc SHAKERS Change TODAY Price USc
NicozDiamond 6.62 1.61 OK Zim -16.66 4.00
NMBZ 2.85 3.60 Innscor -12.50 21.00
Fidelity Life 2.52 9.74 Delta -4.96 58.03
Econet 0.44 20.10 Proplastics -4.16 2.30
Index Previous Today Move Change
Industrial 108.16 105.86 -2.30 points -2.13%
Mining 21.74 21.74 +0.00 points +0.00%
13 zse tables
ZSE
Indices
Stock Exchange

14. BH2414

15. 15 DIARY OF EVENTS
The black arrow indicate level of load shedding across the country.
POWER GENERATION STATS
Gen Station
19 January 2016
Energy
(Megawatts)
Hwange 550 MW
Kariba 285 MW
Harare 16 MW
Munyati 15 MW
Bulawayo 18 MW
Imports 0 - 100 MW
Total 1209 MW
21 January 2016 - CZI/Herald Business Annual Economic Outlook 2016 Half Day Symposium; Venue: Meikles Hotel, Harare; Time:
08:30 to 12:50hrs
10 February 2016 - Nampak Zimbabwe Annual General Meeting: Venue 68 Birmingham Road, Southerton, Harare: Time 12:00
THE BH24 DIARY

16. BH2416

17. JOHANNESBURG - South Afri-
ca's rand gained against the
dollar early today and could
continue to benefit from inves-
tors culling their long dollar
positions after a recent heavy
sell-off.
The JSE securities exchange's
Top-40 futures index was up
1.1 percent, suggesting the
local bourse would open more
than 470 points higher at 0700
GMT.
At 0755 GMT the rand was at
16,7400 to the dollar, up 0,65
percent from Tuesday's close
at 16,8500.
"There does seem to be an
overhang of long dollar posi-
tions," Standard Bank trader
Warrick Butler said. "On a
short term basis there is minor
trend line support around
16,6800." The local currency
has fallen more than 8 per-
cent against the dollar this
year, weighed down by con-
cerns over the outlook for the
sickly local economy as well as
slowing growth in China, a key
importer of South African com-
modities.
Despite the lethargy in the
South African economy, trad-
ers and analysts are pricing
in the chance of a 25 or 50
basis point rate hike when the
central bank holds its first pol-
icy meeting of the year next
week, against the backdrop of
rising inflation.
In fixed income, the yield for
the benchmark government
instrument due in 2026 was
down 6 basis points at 9,77
percent in early trade - Reu-
ters●
regioNAL News17
Rand firms as investors trim long dollar positions

18. BH2418

19. In a world awash with cheap
oil, buyers in the world’s big-
gest consuming region aren’t
clamoring for an additional
500,000 barrels a day from
Iran.
As international sanctions
against the country are lifted
and Oil Minister Bijan Namdar
Zanganeh looks to make good
on his pledge to regain market
share lost in Asia, he’ll have
to contend with a global glut
that’s dragged down prices
and spawned a buyers’ market
with abundant supplies from
the Americas to Africa and the
Middle East.
While consumers such as
Japan’s Cosmo Energy Hold-
ings Co. and India’s Hindustan
Petroleum Corp. are open to
buying more, they say Iran
will have to provide an incen-
tive. Purchases by some cus-
tomers in Asia dropped about
50 percent after sanctions
were imposed on the Middle
East producer over its nuclear
program.
“We can accommodate more
Iranian crude but it will depend
on what terms and conditions
they offer,” Sanjiv Singh, the
director of refineries at Indian
Oil Corp., the nation’s largest
processor, said by phone Mon-
day. “Refining capacities and
configurations have changed
since the time Iran went under
sanctions, so can’t say if vol-
umes similar to that time will
be bought by refiners.”
Sanctions Effect
In South Korea, shipments
from Iran have tumbled by
more than half since 2011,
according to government data
compiled by Bloomberg. While
Asia’s fourth-biggest oil user
imported a record amount of
crude last year, purchases
from Iran fell about 8 percent
to the lowest in data going
back to 1995.
Iran was the second-biggest
producer in the Organiza-
tion of Petroleum Exporting
Countries before its disputed
nuclear program prompted
the European Union to ban
purchases of its crude in July
2012. Countries including
China, India and Japan had to
get a waiver from the US to
buy limited amounts of Ira-
nian oil or risk losing access
to parts of the global financial
system.
“Until now, refiners had to
annually reduce Iranian crude
imports due to international
sanctions,” South Korea’s Min-
istry of Trade, Industry and
Energy said in an e-mailed
statement on Jan. 17.
“They can now voluntarily
decide their own import lev-
els, considering domestic
demand.”
Brent crude, the benchmark
for more than half the world’s
oil, added 48 cents to $29,03 a
barrel by 1:34 p.m. Singapore
time. Prices fell to $28,55 on
Monday, the lowest close since
December 2003.
Exports Boost
Iran is targeting an immedi-
ate increase in shipments of
500,000 barrels a day, Amir
Hossein Zamaninia, deputy
oil minister for commerce and
international affairs, said Sun-
day in an interview in Tehran.
Iran plans to add another half
million barrels within months.
Japan’s Chief Cabinet Sec-
retary Yoshihide Suga said
Monday the Asian country
“welcomed” that Iran com-
plied with the deal on its
nuclear program. The nation
cut annual crude purchases
from the Middle East producer
nearly half to about 166 000
barrels a day by 2014 from
2011 levels, according to data
from the Ministry of Finance.
Japan’s Cosmo Energy will
decide on an increase in Ira-
nian crude purchases only
if it makes economic sense,
Eita Ushioda, a Tokyo-based
spokesman for the company,
said by phone Monday.
“I hope Iran will consider
better terms for Indian refin-
eries to make their way in
this growing market,” B.K.
Namdeo, director refineries
at India’s state-run Hindu-
stan Petroleum Corp., said by
phone on Monday.
“Better terms could be in the
form of services like more
loading days. Can’t say at
this point whether we will be
able to return to the volumes
before sanctions any time
soon. It will all depend on
prices and other terms.”
- Bloomberg●
internatioNAL News19
Iran's next test is winning back buyers in biggest oil market

20. By Fatima Bhoola
Given that South Africa oper-
ates within a flexible exchange
rate regime, the value of the
rand, like any commodity, is
determined by the market
forces of supply and demand.
The demand for a currency rela-
tive to the supply will determine
its value in relation to another
currency.
Theoretically, the demand for a
floating currency – and hence
its value – changes continually
based on a multitude of factors.
In the case of the rand, its cur-
rent weakness can be attributed
to a myriad of structural prob-
lems facing the local economy.
The main determinants of a cur-
rency’s value include demand
for a country’s goods and ser-
vices. This is closely linked to
the growth and national income
of its main trading partners.
Equally important is the domes-
tic interest rate.
If it is high it is likely to attract
foreign capital, causing the
exchange rate to strengthen.
But high inflation can wipe out
the benefit of high interest
rates to foreign investors. Addi-
tional factors serve to drive the
currency down. These include a
current account deficit.
The current account deficit gets
bigger when a country spends
more on foreign trade than it
is earning and has to borrow
capital from foreign sources to
make up the difference. This
implies that a country requires
more foreign currency than
it is getting through sales of
exports, and it supplies more of
its own currency than foreign-
ers demand for its products.
This excess demand for foreign
currency leads to depreciation
in the value of a currency. Fac-
tors such as political instability
and poor economic performance
can reduce investor confidence.
This inevitably forces foreign
investors to seek out stable
countries with strong economic
performance.
Thus, a country that is per-
ceived to have positive attrib-
utes will attract investment
away from countries perceived
to have more political and eco-
nomic risk. There is a further
complication to currency move-
ments.
The buying and selling of cur-
rencies is no longer driven only
by the need to facilitate trade
but also by the demand for
currencies as financial assets.
This means that currencies are
bought and sold like any other
asset. Decisions by traders –
to buy or sell a currency – can
have a marked effect.
The impact of the turmoil in
China South Africa’s currency
lost 26 percent of its value in
the six months after turmoil
gripped Chinese markets in
June 2015. This was when the
People’s Bank of China sur-
prised markets by executing a 2
percent devaluation of the yuan
and changing the way it traded
its currency. The aim was to
weaken the yuan to boost its
export competitiveness.
20 analysis20 analysis
How currency markets work and why the South African rand is falling

21. 21 analysis21 analysis
This, coupled with slower eco-
nomic growth, has aggravated
the situation for South Africa
as well as other African coun-
tries that rely on oil and min-
eral exports to China. Emerging
markets most exposed to lower
growth prospects and subdued
commodity prices have seen
the sharpest falls.
The rand is expected to remain
under pressure with many ana-
lysts predicting that it will fall
further in 2016. It is not alone.
Many other emerging market
currencies have been dealt the
same fate. But the rand is sub-
stantially weaker than it might
have been.
The sudden reshuffling of the
finance ministry was seen as
weakening one of the country’s
key macroeconomic institutions
and continues to undermine
market confidence. Implications
of the weak rand The weak rand
has a number of implications for
the country’s growth prospect.
Firstly, the weakening currency
carries the risk of pushing up
inflation because imported
goods are more expensive.
This means that the South Afri-
can Reserve Bank faces a diffi-
cult decision. It can keep inter-
est rates low but then faces
even higher inflation.
This will only devalue the rand
further. If the central bank
takes more aggressive action
by raising interest rates, it risks
stifling growth in an economy
that is only growing at 1,5 per-
cent.
The rand’s weakening could not
have come at a worse time for
South Africa. The country is suf-
fering from the worst drought
since 1992 which has increased
food costs and pushed the
farming industry into recession.
The price of white corn, a sta-
ple food in southern Africa,
has more than doubled on the
South African Futures Exchange
in the past year. With large
parts of the economy already in
recession, coupled with wors-
ening debt levels and the threat
of credit-rating downgrades, it
looks like the economy will con-
tract.
This implies that Finance Minis-
ter Pravin Gordhan has limited
room to boost spending. The
weak rand will also see the cost
of imported goods for consum-
ers rise. In addition, while the
rest of the world benefits from
record low oil prices, the coun-
try’s weaker currency means it
will not able to take full advan-
tage of this and may face higher
fuel prices in the near future.
On the flip side, the weaker
rand does have some bene-
fits. It is helping mines stay
afloat. And gold mines could
make profits again as the gold
price has held up more than the
prices of other minerals. There
may also be a boost in tourism.
The weaker rand may also have
short-term benefits for sub-Sa-
haran countries importing sub-
stantial volumes from South
Africa. Finally there may be a
boost for local exporters. But
this could be stifled by the rise
in the price of imported raw
materials which will contribute
to higher costs of production for
manufacturers.
Is the rand over-traded? In
2013 the South African rand
was ranked as the 18th most-
traded currency in the world.
Surprisingly, while South Africa
accounts for only 0,3 percent
of the world’s daily foreign
exchange market turnover, the
rand accounts for 1,1 percent of
worlds daily currency trading.
This difference is largely due to
the daily trade taking place out-
side South Africa by non-resi-
dents.
This is partly a result of vir-
tually no exchange control
restrictions for foreigners trad-
ing the rand but many in place
for South Africans who wish to
trade in foreign currency. This
has been highlighted as a fur-
ther problem faced by the cen-
tral bank in trying to influence
the value of the rand. - Polity.
org ●
*Fatima Bhoola is a lecturer in
Economics at the University of
the Witwatersrand This article
was originally published on The
Conversation.