Good morning. Here’s what you need to know to start your day.
-
Talks on restructuring DBZ have began – Nkhoma
-
Argentina raises interest rate to 97% as it struggles to tackle inflation
-
Capital and technology will be key to driving the global green transition – ZANACO
Story of the Day
In 2022, European politicians formed an initiative with the goal of banning proof-of-work mining because of its high electricity consumption. The underlying goal is to blame Bitcoin for damaging the environment, when it’s – as they claim – just a tool for useless speculation. In 2021, the co-founder of Ripple, which advertises itself as having better qualities than bitcoin, donated $5 million to support Greenpeace USA with a campaign called “Clean Up the Code.” It attempts to lobby Bitcoin developers to change the mining mechanism from proof of work to proof of stake, which would supposedly reduce its power consumption by 99%. With Ethereum moving from proof of work to proof of stake recently, these actors feel they have seen their theory confirmed and are trying to lobby against Bitcoin even more. What they don’t mention is that the differences between proof of work to proof of stake are huge. These mechanisms have different goals and very different outcomes, which result in different properties of the cryptocurrencies they secure. In short: the immutability of proof of work is stronger than that of proof of stake. Read more
In Local Business News Sponsored by
Development Bank of Zambia Board Chairperson Noel Nkhoma says the bank is in talks with its principal shareholders on how best it can be restructured. And Nkhoma says DBZ’s loan recovery rate has improved, and that the bank has drastically cut its losses. Asked in an interview when the bank was likely to resume lending, Nkhoma said it was important first to undertake a restructuring process. “Let us go through this restructuring first, very important because new capital is what will more [or] less be our tool to be able to resume lending. There is an engagement with the shareholder, the principal shareholder in terms of how to restructure DBZ. Read more: News Diggers
The Bank of Zambia (BoZ) has engaged the African Export–Import Bank (Afreximbank) to facilitate local financial entities to join the Pan African Payment and Settlement System (PAPSS). The PAPSS is operated by Afreximbank as a centralised financial market infrastructure, which will enable instant cross-border payments among the African Continental Free Trade Area (AfCFTA) member nations. The Bank of Zambia (BoZ) signed the agreement for Zambia to join PAPSS on December 31, 2022 after Afreximbank officially launched PAPSS on January 13, 2022 following a pilot phase in the West African Monetary Zone (WAMZ) region. According to the Zambanker magazine released by the BoZ on Friday in Lusaka, the system was designed to support integration of both national and regional payment systems across the continent. Read more: Zambia Monitor
Zanaco Chief Executive Officer, Mukwandi Chibesakunda, has been listed for the African Banker Awards 2023 under the category of “Banker of the Year. This is according to a statement issued in Lusaka on Monday by Zanaco Acting Head Communications, Kalonde Nyati. The African Banker Awards, organised by the African Banker Magazine in collaboration with Business in Africa Events, recognise the best individuals and institutions driving Africa’s fast-changing financial services sector. Chibesakunda has been nominated for the award in recognition of her outstanding leadership and contribution to the growth of Zanaco. Read more: Zambia Monitor
Zambia Airways has announced the launch of new direct flights from Lusaka to Johannesburg, providing passengers with a convenient and reliable way to travel between the two cities. The service will commence operations on 1st June 2023 and will be operated with a modern and comfortable B737-700 aircraft, offering both Business class and Economy class. Read more: Lusaka Times
Bank of Zambia Exchange Rates
Currency | Buying | Selling |
---|---|---|
USD | 18.4131 | 18.4570 |
GBP | 23.0237 | 23.0842 |
EUR | 20.0243 | 20.0794 |
ZAR | 0.9629 | 0.9653 |
In International Business News Sponsored By
The Central Bank of Argentina raised its key interest rate Monday by six percentage points to 97% in an effort to tackle soaring inflation that has reached 30-year highs. Central banks across the globe are struggling to rein in inflation, but it’s a particular problem in Argentina, where the annual inflation rate soared above 100% last month. That’s the highest level since the early 1990s, and currently, Venezuela and Zimbabwe are the only two countries experiencing higher inflation than Argentina, according to International Monetary Fund data. (By comparison, inflation hovers below 5% in the US, where the central bank has raised key interest rates by five percentage points over 14 months.) Read more: CNN
Questions swirl about the strength of China’s recovery from Covid lockdowns, and there’s talk of recession in the United States. Yet Europe’s economic prospects have brightened in recent months, according to the European Commission. The EU’s executive arm on Monday upgraded its growth outlook for 2023 and 2024. It now expects the EU economy to expand 1% this year, up from an estimate of 0.8% in February. Growth next year is pegged at 1.7%, an upward revision of 0.1 percentage points. The improved forecast for Europe — which narrowly dodged a recession this winter — still represents a marked slowdown on last year, when the bloc’s economy grew 3.5%. But it reflects sharply lower energy prices, which are reducing costs for businesses and easing the strain on households. A strong job market and ongoing government stimulus are also providing a lift. Read more: CNN
Treasury Secretary Janet Yellen reaffirmed to Congress on Monday that the United States could default on its debt as early as June 1. “With additional information now available, I am writing to note that we still estimate that Treasury will likely no longer be able to satisfy all of the government’s obligations if Congress has not acted to raise or suspend the debt limit by early June, and potentially as early as June 1,” she wrote. The guidance came as the White House and congressional leaders prepared to meet Tuesday to continue negotiations over potential spending cuts in exchange for House passage of a debt ceiling hike. The Democratic-majority Senate is expected to back whatever the White House negotiates with the GOP-controlled House. Read more: CNBC
China’s economic data for April broadly missed expectations as the economy continued to show an uneven path of recovery from the impact of its stringent Covid restrictions. Industrial production for April rose by 5.6% year-on-year, compared to the 10.9% expected by economists surveyed in a Reuters poll. The figure was up 3.9% in March following a muted start to the year. Retail sales rose by 18.4% – lower than economists’ forecast a surge of 21%. Fixed asset investment rose by 4.7%, against expectations of 5.5%. The reading rose 5.1% the previous month. Read more: CNBC
Zambia’s largest bank, ZANACO, has said that capital and technology will be key to driving the global green transition. The bank’s CEO, Mukwandi Chibesakunda, said that strengthening technology, Environment Social Governance (ESG) and capital mobilisation will aid explorations and production ramp up. This will ensure accountability to the environment and communities, and ensure availability of funds for small to medium sized enterprises in the mineral value chain. Zambia is at a critical stage of its economic life cycle, characterised by strides towards debt restructure and leveraging off its vast mineral resources to rekindle growth. Synonymous with mining as its mainstay, the mining conversation in a modern world can not be had in isolation of decarbonisation in an ESG era. Read more
In 34 trades recorded yesterday, 5,016 shares were transacted resulting in a turnover of K16,528.08. Trading activity was recorded in CEC Zambia, Chilanga Cement, PUMA, Zambeef and Zanaco as well as CEC Africa on the quoted tier. The LuSE All Share Index (LASI) maintained its close at 8,150.79 points. The market closed on a capitalization of K76,410,598,978.90 including Shoprite Holdings and K41,627,913,538.90 excluding Shoprite Holdings.
Picture of the Day