Econet, which is the country's largest telecoms company with an over
60% share of the mobile market, reduced its key tariff by close to 20%
with effect from last Sunday.
Econet's highest tariff had been 29 cents, but tariffs will now fall to as low as 21 cents on some packages.
Econet chief executive officer, Douglas Mboweni, said the decision to
reduce tariffs was part of a strategy by the company to increase
affordability and drive up usage.
"This is the second time we have reduced our tariffs since the beginning of the year," Mboweni said.
In January, Econet reduced off-peak call charges by 23 percent. Mboweni
said the lower off-peak tariff had a huge impact on usage and service
quality.
"The idea behind off-peak tariffs was to get people to make
non-business calls in the evening, and reduce pressure on the network
during business hours. It has worked very well."
The Econet boss said his company would continue to develop new services to address the issue of cost to customers.
But he said many constraints remain, outside of his company's
influence, limiting efforts to reduce charges even further. At the top
of his list was the cost of power, and also government fees. Zimbabwean
operators spend four times more than their regional peers on power, as
up to a third of their base stations have to be continuously fired up
by expensive back up diesel power.
On government fees, Mboweni said 20% of the cost of each call still goes to government in fees.
"Given how essential telecoms is to the economy we think there is room to reduce these charges further, Mboweni said.
A seven-year period in which Zimbabwe had the lowest tariff in the world had done a lot of damage on telecoms infrastructure.
The Econet CEO said that his company had now embarked on a major
programme to repair and replace obsolete equipment. The company has
ordered new equipment to expand capacity. Providing more services
entailed more than just releasing new lines, he cautioned.
"That SIM card only works because we have spent millions in US dollars
building supporting infrastructure. A single base station costs us more
than $250 000, and we currently have more than 500. That gives you an
idea of how much we have invested so far," he said.
Econet has secured funding and equipment to increase the subscriber
base to 2.3 million by year-end. This means more than one million new
lines would be released during this year.
THE Institute of Directors Zimbabwe said its Theme for this 2008 programme is "Striking the Balance".
The theme was taken from the image of balancing rocks, which are seen to represent solidity, stability, reliability and beauty.
This year, in line with its emphasis on corporate governance, the IODZ
will also once again place special emphasis on the contribution of
nominees towards sound corporate governance in their respective
organisations as part of the criteria for the award.
The overall winner of the Director of the Year Award will receive fully
paid attendance at the Annual Convention of the Institute of Directors
in London in April 2009.
IODZ spokesman, Mark Oxley said the metaphor was the balancing act in
African business against a background of endless challenges.
" It also symbolises the need for an outstanding director to be able to
strike a balance between a variety of skills and characteristics.
There are also financial objectives for this programme.
In addition to being the major activity of the year for the IODZ in the
field of corporate governance, the award programme is also a
significant source of income for the IODZ.
Any financial surplus made by the programme is used to support the administration of the Institute.
"This year there is a major need to rebuild the secretarial and
administrative services of the IODZ, in order to provide improved
services to members of the Institute.
To this end it is intended that DOYA 2008 will generate funds for this
purpose as well as recognise Zimbabwe's outstanding directors," Oxley
said.
A selection panel comprising senior directors and former winners of the
award is being established to review all nominations, to select the
winners in the various categories and to select the overall winner.
Candidates will be required to set out their personal vision for
Zimbabwe, individual contribution to the crafting and achievement of
the vision of their company and organisation.
SUGAR producer Triangle Limited reportedly needs a minimum
investment of R70 million to achieve an annual production of 600 000
tonnes in the next two years.
At its peak, the Triangle Estate achieved an output of 580 000 tonnes
of sugar in 2002. But production fell to 298 000 tonnes last year,
which was "an absolute nightmare", its major shareholder Tongaat Hulett
said last week.
It was difficult for the company to get raw materials for cane growing and factory consumables.
Tongaat Hulett, a South African sugar giant owns 100 percent of the 30
000ha Triangle Estate and 51 percent of the adjacent Hippo Valley
Estate.
Tongaat Hulett chief executive Peter Staude expressed optimism that
Zimbabwe's economy was now on the recovery track while noting efforts
were need- ed to ensure macroeconomic stability.
"The economy is changing rapidly and a lot of serious people are trying to put it back on track," said Staude.
Most businesses in Zimbabwe and foreign investors are riding on
positive political developments in the country that saw the main
political parties forming an inclusive Government last month.
Triangle had stopped selling sugar in January but has since resumed after Government legalised the use of multiple currencies.
"We started realising that the Zimbabwean dollar was disappearing in
December and stopped selling sugar in January, but we have since sold
14 000 tonnes now."
Tongaat Hulett's operations in SA produced 644 000 tonnes of sugar last
year. But Staude noted that under normal conditions, Zimbabwean sugar
operations would have twice the capacity of the expanded Mozambican
operations.
Production at Triangle is expected to rise to 411 000 tonnes of sugar next year.
THERE has been no hand over take over from Zinwa to the city council
despite the deadline for the proceding which were set for Saturday.
Reports say none of the urban councils managed to reclaim the
management of water and sewer from Zinwa by the Saturday deadline.
Zinwa officials say the delays were caused by a system which requires
an agreement on the status of workers, an inventory of all plant and
equipment among other procedures attendant to the transfer of assets
from one utility to the other.
A senior Zinwa official confirmed that no council had completed all the formalities with the water body.
Last week, all urban local authorities met the Minister of Local
Government, Urban and Rural Development, Ignatius Chombo, and briefed
him on the poor state of the water and sewer infrastructure in their
towns and cities.
The councils also painted a gloomy picture of the status of water,
citing shortage of money to procure enough water treatment chemicals.
THE Consumer Council of Zimbabwe this week said prices in most
shops trading in foreign currency were high compared to those obtaining
in the region and need to be lowered further.
He said business should know that consumers are not happy to have products in the shops when prices are not affordable.
CCZ said it was not in the best interest for consumers to cross borders to buy goods.
"While business leaders are worried about the five percent which
businesses are required to selle to the Reserve Bank, they
[businesspeople] must also consider that the mark-up on their products
is too high. In the end, prices become unaffordable to consumers," said
CCZ.
The consumer watch dog said it was imperative for businesses to
establish percentage mark-ups as the country was using multi-currency
system.
"Since trading can be done using stable currencies such as the US
dollar, British pound, and the South African rand, among others, it is
better for businesses to use percentage mark-ups to avoid unnecessary
price distortions," it said.
In the first quarter monetary policy statement, Reserve Bank Governor,
Gideon Gono, said that all licensed traders, save for those explicitly
exempted, would sell five percent of their gross foreign exchange sales
to the central bank at the going market exchange rate.
THE Government must engage the business community when crafting
policies for economic development, businesspeople in Matabeleland have
said.
Speaking at a business meeting at the Zimbabwe National Chamber of
Commerce offices in Bulawayo on Monday, ZNCC president Obert Sibanda
said businesspeople in the region expected the new Government to
consult stakeholders when devising policies for economic development.
The Minister of Industry and Commerce, Professor Welshman Ncube,
Minister of Regional Intergration and International Cooperation, Ms
Priscilla Misihairabwi-Mushonga and Matabeleland business executives
attended the ZNCC organised meeting.
Addressing the gathering Mr Sibanda said, As business people in
Matabeleland, we are looking forward to the new Government to have an
inclusiveness that goes beyond politicians. We are appealing to the
Government of National Unity to include other stakeholders in economic
development strategies.
Mr Sibanda said ZNCC had come up with a manifesto, which called for the
initiation of dialogue between the Government and business leaders.
He said the manifesto, among other expectations, focused on policy framework, country risk, and infrastructure development.
As businesspeople, we want a situation where we come up with
comprehensive economic policies that the Government implements in
turning around the fortunes of the country, he said.
He said, for example, as a business community, we are advocating the
rationalization of tariffs for public utilities like the Zimbabwe
Electricity Supply Authority and TelOne.
For now the tariffs that most parastals are charging for their
services are too high and this results in enterprises incurring high
production costs, which in turn can cripple efforts to resuscitate key
sectors of the economy, he added.
Over the years, he said, there was loss of investor confidence in the country.
So far, there is a general loss of investor confidence in the country.
This was worsened by negative publicity in the country’s tourism
sector, he said.
THE International Monetary Fund managing director Dominique
Strauss-Kahn spoke by telephone with South African Finance Minister
Trevor Manuel yesterday to discuss "how to resume relations" with
Zimbabwe and help revive the economy after a decade of recession.
The IMF will continue talks with Manuel next week at an IMF conference
in Tanzania, Strauss-Kahn told reporters in Johannesburg via a video
link from Washington.
The fund is also preparing to send a team to Zimbabwe, Ms Antoinette
Sayeh, head of the lender's Africa department, said at the press
conference.
Zimbabwean Finance Minister Tendai Biti met with his regional
counterparts in Cape Town last month, where he requested US$2 billion
in aid over the next 10 months to address a humanitarian crisis and
revive the economy.
Zimbabwe still has an outstanding debt to some donor countries and
financial institutions that will have to be repaid before new aid can
be released, Ms Sayeh said.
"We have a mission going out to Zimbabwe to take stock of the
situation, to discuss with the new authorities their policy ambitions
and reform agenda, to be able to assess whether the international
community can then come in and support," she said.
The African Development Bank has said that Zimbabwe owes it US$460 million, which must be repaid before it can resume lending.
The IMF estimates Zimbabwe's arrears to the fund are US$130 million.
Speaking earlier South African Foreign Minister Nkosazana Dlamini-Zuma
said Sadc wanted to help Zimbabwe by normalising its relations with
global lenders like the International Monetary Fund, which suspended
dealings with Harare three years ago.
Dlamini-Zuma was speaking after Sadc finance ministers held a meeting
in South Africa said there was need for the regional bloc to invest
US$2 billion in Zimbabwe.
Prime Minister Morgan Tsvangirai, Foreign Affairs Minister Simbarashe
Mumbengegwi and Biti had earlier on attended meetings in South Africa
to discuss the economic rescue package for Zimbabwe.
South African President Kgalema Motlanthe convened the ministers'
meeting and Minister Biti led a delegation to the meeting where he
presented proposals on Zimbabwe's recovery strategies.
Although Tsvangirai said Zimbabwe needed US$5 billion for its recovery
programmes, SA Finance Minister Manuel said it was just a number and
"there was a document which split the immediate costs over the next 10
months into two amounts of about US$1 billion each".
He said there was need for a US$1 billion loan to stimulate retail and
related industries, which the ministers were looking at immediately
mobilising, and another US$1 billion for emergencies such as education,
health, municipal services and infrastructure.
The African Development Bank hailed Sadc's move and urged the international community to support Zimbabwe's recovery plan.
AfDB president Donald Kaberuka said the new Government had made an
impressive start with its economic recovery plan, which, he said,
needed warranted support.
He said the African Development Bank was looking at setting up its own
donor conference to source funds for Zimbabwe.
Bloomberg.
Post published in: Economy