Thursday, April 12, 2007

DAILY MAIL - Rabobank to pay more

Rabobank to pay more

RABOBANK of Netherlands will pay more for the 49 per cent shares it has acquired in the Zambia National Commercial Bank (ZNCB) after evaluation of the current net asset value. Rabobank paid US$8.2 million based on the financial position of ZNCB on December 31, 2004. Zambia Development Agency (ZDA) acting director general, Glyne Michelo, said this in a statement in Lusaka yesterday.

"Government and the strategic investor (Rabobank) will therefore commission an independent auditor to determine the net asset value of the bank at the completion date, which will be the basis on which the price adjustment will be made," Mr Michelo said.

He said after reassessment of the value of the shares in the last three years, there would be a price adjustment. “This is provided for in the sale and purchase agreement,” Mr Michelo said. He said Rabobank had also agreed with government that there would be possible relocation of some branches but within a radius of five-kilometres for business reasons.

"During this period, Rabobank is contractually committed to increasing the total number of rural branches by 20 per cent," Mr Michelo said. He said the floating of 25.8 per cent shares on the Lusaka Stock Exchange would afford a broad spectrum of Zambian investors an opportunity to participate in the ownership of the bank through buying of shares.

And Mr Michelo said all workers who lose their jobs after the sale of 49 per cent shares in ZNCB would be paid from the proceeds of the transaction. “Government is committed that retrenched staff, if there will be any, is paid from the proceeds of the sale,” he said. Mr Michelo said if retrenchments were conducted, they would be in line with the normal course of business and in keeping with appropriate manning levels in the bank. “After the acquisition of ZNCB, the investor has only engaged a total number of three expatriate staff who include the managing director, manager for change management and risk manager,” he said.

Mr Michelo said the three expatriates had been engaged under the provisions of a management services agreement, which government and Rabobank signed. “The strategic investor will provide management services and technical assistance to ZNCB for an initial period of three years,” he said.

And Mr Michelo said Government was satisfied that Rabobank would reposition ZNCB as an agricultural financial services provider and developer of new agro-based products to suit rural based farmers.

South persec fails to account for K1.6 bn

SOUTHERN Province permanent secretary, Darius Hakayobe, yesterday failed to account for K1.6 billion which his provincial administration received from the treasury to buy heads of cattle for restocking. This was when Mr Hakayobe appeared before the Public Accounts Committee (PAC), chaired by Luena member of Parliament, Charles Milupi.

Mr Milupi said the report that Mr Hakayobe submitted was "bad as a lot of things have been unearthed as to how K1, 670,235 245 out of K1, 784,635,245 meant for cattle restocking was misapplied by the provincial administration”. Mr Hakayobe was asked to leave and not return, after he failed to answer queries in the Auditor General's report on irregularities in the procurement of cattle. "There is a variation of funds without authority from the treasury.

This is an extra bad report that we have received. There is nothing for you to go back and do. We don't care whether you lose your job, but we care when poor people do not get what is meant for them," Mr Milupi said. He said the cattle restocking exercise was an important one which should have been given the importance it deserved.

The committee heard how money allocated under the Public Sector Reform Programme (PSRP) for cattle restocking was spent on paying telephone bills, subsistence allowance, including personal loans and workshops.

More than 1,000 heads of cattle bought for distribution to Sinazongwe and Siavonga in April 2006 could not be accounted for because of lack of receipts and disposal details.

Mazabuka District Commissioner, Misheck Chiinda, was also taken to task by the committee for allegedly admitting to having asked to be paid K10 million from a total of K114, 400, 000 in form of a cheque, that was paid to Magoye Small Holder Dairy Farm for the supply of 88 heifers for the district.

Mr Chiinda told the committee that when he went to collect the cattle, he decided to collect only 75 heifers, leaving a balance of 13 costing K15, 600,000.

"The decision to do this was to allow us to borrow K10 million for operational costs," he said.

Auditor General, Anna Chifungula, said there was K1.7 billion meant for the exercise and that the question of lack of funds could therefore not arise.

She said it was forbidden for money released under PSRP to be used for anything other than the intended purpose. "There is no excuse of saying K10 million was needed for operational costs.

All the K1.7 billion was allocated for the purpose of cattle restocking and normally, an amount of 10 per cent of the total allocated amount is included for operational costs," she said. Accountant General, Mike Goma, said Mr Chiinda had no authority to deviate public funds as any variation of budgets needed consent of the Secretary to the Treasury. "This is unacceptable. The people that this exercise was meant for have not benefited at all. You are operating outside the Appropriation Bill and you are also weakening the budgeting system, " he said.

SADC/Comesa urged to harmonise policies

GOVERNMENT has called on both Common Market for Eastern and Southern Africa (COMESA) and Southern African Development Community (SADC) to work towards harmonising their various economic environments in member states. This is in order to promote and enhance fair and competitive trade within the sub-region.

Ministry of Commerce, Trade and Industry permanent secretary, Davidson Chilipamushi said that in an environment where the 'playing field' was leveled, only goods and services that meet international standards would be traded.

This would result in mutual benefits for all countries involved in trade.

"Regional economic bodies should work towards harmonising macro economic fundamentals in member countries so that it does not have pay to have a strong economy,” Mr Chilipamushi said.

The permanent secretary was speaking in an interview at Lusaka’s Inter-continental hotel.

“ some countries within the sub-region with very weak exchange rates, in their pursuit for foreign currency with goods that do not meet international standards are finding their way into the market mostly through smuggling thereby distorting the whole purpose of fair trade,” he explained.

Mr Chilipamushi cited the European Union (EU) as one economic body that had worked towards harmonising economic environments in member states.

"Off course for the Europeans it took time for them to be where they are but if we are to enhance and promote fair regional trade, we should work towards that objective," he said.

Mr Chilipamushi also said it was difficult for Government to keep tab on the goods and services coming into the country due to the large border areas Zambia shares with her eight neighbours.

He said few border posts and vast border areas had made it easier for inferior goods, most some of which is smuggled by even through rivers to find their way onto the local market
Recently, most stakeholders, especially the manufacturing sector and ordinary citizens expressed concern at the influx of foreign goods coming into the country most of which they said was of sub-standard and was weakening the competitiveness of locally manufactured goods.

Most imported goods that have continued to flood the local market were said to be coming mostly from Zimbabwe which has seen the state of its economy in free fall with inflation rate running at more than 1,500 per cent.

UPND steps into Albidon Zambia Nickle mine

THE United Party for National Development (UPND) in Southern Province has directed councillors in Mazabuka to reduce the portion of land given to Albidon Zambia Limited Munali Nickel Mine to 1,600 hectares until an environmental impact assessment study is conducted on the remaining 500 hectares. Provincial publicity and information secretary, John Chidyaka, claimed that the motion to approve the entire 2,100 hectares of land was hurriedly done because councillors were not given enough time to study it thereby forcing them to support it blindly and ignore technicalities.

Mr Chidyaka said in Mazabuka soon after the protracted meeting that lasted for eight hours on Sunday that the UPND directed councillors to withdraw the motion during their next full council sitting and only approve 1,600 hectares. He explained that the party took such a decision because the Environmental Council of Zambia did not conduct an environmental impact assessment study on the remaining 500 hectares. Mr Chidyaka explained that the resolutions endorsed by all the 20 councillors should not be viewed as a rejection of the project but as one meant to follow procedure.

He said UPND supported the opening of the mine but would not support the passing of resolutions, without taking into consideration the plight of people affected by such development. The meeting was chaired by UPND provincial chairman, Gideon Siakalima, UPND national vice chairman, Philip Maambo, Mazabuka member of Parliament, Garry Nkombo, his Chikankata counterpart Habeenzu Munji and Magoye MP, Benson Mweemba.

Others who attended the meeting are UPND Magoye Constituency officials and all councillors in the district. Mr Chidyaka revealed that the differences between Mazabuka Mayor Edmund Cheelo and Mr Nkombo had been resolved and the two had pledged to work as a team.

But Town clerk Ekan Chingangu said UPND has no mandate to overturn a decision made by the council. He explained it was only the civic leaders that were mandated to review their decision after six months.

Mr Chingangu also dismissed claims by UPND that an environmental impact assessment study was not conducted on the 2,100 hectares.

He said the claims should be dismissed because they lacked merit.

Mr Chingangu said the mine made one application of 2,100 hectares of land contrary to claims by the opposition party that it had applied for 1,600 hectares.

He urged politicians to desist from frustrating well-meaning investors such as the Albidon Zambia Munali Nickel mine, which had shown its commitment by building modern structutres, cultivating fields and provision of cattle to villagers earmarked for resettlement.

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