Story of the Day
As we move into the second half of 2022, the volume of reported deals is surprisingly lower than the numbers seen for the same period of 2021. The Competition and Consumer Protection Commission (CCPC), the anti-trust authority that approves mergers that are 15 million Kwacha (approximately USD 930,000) and above in terms of deal size, in its 2022 mid-year update, reported that it continues to experience a reduction in the number of merger applications received, and cites disruptions and previous uncertainty in the Zambian business environment and global economy at large brought about by the Ukraine-Russia conflict and the Covid pandemic. In terms of sectors, Wholesale and Retail recorded the highest number of deals followed by Agriculture, Banking and Finance, Services, and Transport, manufacturing and ICT. Read more
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Banks in Zambia are in a rate cut relay as they see the government curve sagging in the medium to long term. many financial players are hedging their bets to pay off with a sag in the government yield curve. The risk skew for these harsh times was towards higher yielding short-dated tenors up to one year while players shied away from longer-dated bonds. Much as the risk behavior has changed with money managers taking risks in longer-dated bonds as they bet on Zambia’s economic recovery. For traders, this is the best time to ramp books with govies for mark-to-market purposes while for those seeking to make a margin on excess funds housed in central bank current accounts at zero interest a little bit of retail lending makes risk management sense. Read more: The Business Telegraph
Manufacturing pulse in Zambia is set to headline stronger in the purchasing managers index markit economics September readings supported by currency bulls and lower petroleum prices. The PMI reading is set to take a positive cue from the energy regulatory board price cut and sentiment driven Kwacha appreciation in the month. Read more: The Business Telegraph
Vedanta has set its eyes on Zambia with the prospect of investing in the electric car battery manufacturing sector. This follows the recent signing of an MOU between Vedanta and the state of Gujurat of India to set up a semiconductor fabrication plant commonly referred to as a fab unit, a display fab unit, and a semiconductor assembling and testing unit in Ahmedabad in western India. Vedanta Country Director Dr. Moses Banda says Vedanta is considering engaging the Zambian Government to consider the possibilities of participating in the electric car battery manufacturing industry that the country plans to set up in collaboration with the Democratic Republic of Congo. Read more: Lusaka Times
The Zambia Development Agency (ZDA) says the prevailing economic stability in the country is encouraging private sector participation in investing in Zambia. ZDA acting Director General Albert Halwampa says the country has been seeing more actualized investment since last year. Mr. Halwampa stated that a country can only thrive economically when investment pledges are turned into reality to enhance job and wealth creation. He said was speaking in Chilanga today when ZDA signed an Investment Promotion and Protection Agreement (IPPA) with Wonderful Group of Companies at United Capital Fertiliser plant. Read more: Lusaka Times
Zambian Empowerment Hub for Entrepreneurship and Skills Training (ZEHEST) has called for the creation of an entrepreneurs’ fund which should be administered on merit. Speaking in an interview with Money FM News, Organization Executive Director Clarence Muzyamba stated that doing so will allow Small and Medium Enterprises (SMEs) who are eligible and are able to exhibit innovation as well as creativity, to get the funds so that people who do not quality don’t end up getting the empowerment funds. Mr. Muzyamba lamented that accessing empowerment under Constituency Development Funds (CDF) has been a challenge for most SMEs. Read more: Money FM
Zambia Congress of Trade Unions (ZCTU) president Chishimba Nkole says government should consider increasing the Pay As You Earn threshold in the 2023 National Budget because the country’s economy is now stabilising. In an interview, Nkole insisted that in order for people’s take-home pay to make sense, the tax-exempt threshold should be increased to K8,000. Read more: News Diggers
International Business and Finance
On 21 September William Ruto delivered his inaugural address at the 77th session of the United Nations General Assembly. Kenya’s new president will hope that the speech, in which he demanded urgent climate action and greater inclusion for the Global South in the UN’s peace and security architecture, will establish his credentials as a leading voice of African ambition on the world stage. In what could come to represent a significant departure from predecessor Uhuru Kenyatta’s trade policies, Ruto honed-in on the value of multilateral relationships between Africa and the rest of the world. Under Kenyatta, Kenya flirted with the possibility of bilateral trade deals in recent years and looked set to sign the US’s first free trade agreement in sub-Saharan Africa when talks with the Biden administration recommenced this summer. Read more: African Business
The World Bank recently revealed that Nigeria’s economy is very insecure and subject to factors outside of its control. The bank noted in its draft report for State Action on Business Enabling Reforms, that Nigeria’s economic ability to attract domestic and foreign investment is declining and the country’s welfare is worsening despite the economic recovery from the recession. An extract from the report reads: “Although Nigeria’s economy in 2021-2022 recovered from recession induced by the COVID-19 pandemic and lower oil prices, growing by 3.6% in 2021 with an expected growth of 3.2% in 2022, welfare has continued to deteriorate. Read more: Business Insider
The International Monetary Fund (IMF) said its team will be in Ghana between September 26 and October 7 to continue discussions with the Ghanaian government on the necessary policy reforms that must be implemented in line with the country’s $3 billion loan request. A statement by the multilateral lender, seen by Business Insider Africa, explained that the two-week mission to Ghana is being led by Stéphane Roudet, an Advisor to IMF’s Managing Director Kristalina Georgieva. Read more: Business Insider
The Bank of England has said it will “not hesitate” to hike interest rates to curb inflation after the pound fell to a record low against the US dollar. The Bank said it was “monitoring developments closely” and would make a decision on any action in November. Its statement came after the Treasury said it would publish a plan to tackle debt in a bid to reassure investors. In Asia currency market trade on Tuesday, the pound rose by more than 1% to top $1.08. Read more: BBC News
Apple chief executive Tim Cook says there are still “not enough women at the table” at the world’s tech firms – including his own. In an exclusive interview with the BBC, Mr Cook said technology “will not achieve nearly what it could achieve” without a more diverse workforce. He said there were “no good excuses” for the lack of women in the sector. He also said he thought Augmented Reality (AR), and the concept of the Metaverse, were “profound.” “In the future people will wonder how we lived without AR,” he says. “We’re investing a tonne in that space.” Read more: BBC News
Capital Markets Report
In 31 trades recorded yesterday, 3,055 shares were transacted resulting in a turnover of K11,475. A share price gain was recorded in Zanaco of K0.05. Trading activity was also recorded in Chilanga Cement, Standard Chartered Zambia, Zambeef and Zanaco. The LuSE All Share Index (LASI) closed at 7,275.08 points, 0.23% up from its previous close of 7,258.50 points. The market closed on a capitalization of K72,598,818,838 including Shoprite Holdings and K37,816,133,398 excluding Shoprite Holdings.