Good morning. Here’s what you need to know to start your day.
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ZESCO has applied to increase electricity tariffs by 37% over the next five years
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IMF hikes global growth forecast as inflation cools and household spending surprises
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In the second week of January trading on LuSE, there were fourteen company securities that recorded trades of which AECI Mining Explosives was the highest priced
Story of the Day
For many years, Kansanshi Mining Plc has maintained its status for being one of Africa’s top copper producers and has largely contributed to Zambia’s GDP. Recently, First Quantum achieved annual copper production of 776 thousand tonnes (kt) which is a decline of 5% from the year 2021. The decline in copper production at Kansanshi Mine was mainly attributed to low sulphide grades from narrow-veined regions, depleting oxide ore and restricted access to high-grade blocks due to an accumulation of water in the main pit in the second and third quarter. According to FQMs CEO- Tristan Pascall, he accredited the decrease in copper production to higher water levels from the 2021/22 rainy season which severely affected mining deployment. Risks to global demand have also contributed to a decline to copper prices this year, yet the copper market is facing a global shortage as there has been a lack of capital expenditure to boost supply. Read more
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President Hakainde Hichilema has emphasized on the need to preserve peace and stability in Southern African region, as he dates Namibia. Hichilema said this ahead of an Emergency Extraordinary Southern African Development Community (SADC) organ Troika summit on Politics, Defence and Security taking place on Tuesday in Namibia. The summit has been convened by Namibian President Hage Gottfried Geingob. He said the Chair of the organ was expected to deliberate on the prevailing political and security situation in the region, among other key issues. Read more: Zambia Monitor
In its quest to dismantle the over US$1.3 billion debt owed to independent power producers (IPPs) and to meet system and customer base expansion, Zesco Limited has applied to the Energy Regulation Board (ERB) to increase electricity tariffs by 37 percent to be spread over five years. Recently, ERB approved another application by the State power utility to increase connection fees for electricity, meant to improve its service delivery. Read more: Zambia Daily Mail
The Minister of Transport and Logistics in Zambia, Hon. Museba Frank Tayali, has announced his optimism that the signing of the Lobito Corridor Transit Transport Facilitation Agreement (LCTFA) will unlock the business potential along the corridor. This agreement, which involves the Republic of Angola, the Democratic Republic of Congo, and the Republic of Zambia, aims to boost private sector investments, create jobs, and foster economic growth in the three countries through the effective participation of small and medium enterprises in the various value chains. Read more: Lusaka Times
The South Gauteng High Court in Johannesburg will continue hearing a ground-breaking case brought by Zambian children and women against the mining giant Anglo American, seeking compensation for lead poisoning. At the end of the 12-day hearing that opened on 20 January, the Court will decide whether to certify this unprecedented class action demanding that Anglo American South Africa remedy the adverse health impacts of its mining activities in Kabwe. If the case proceeds, it will offer a unique opportunity for residents of Kabwe to have a day in court and secure judicial remedies for the alleged human rights abuses associated with Anglo American’s business operations. Read more: Lusaka Times
In International Business News
Toyota Motor Corp sold 10.5 million vehicles in 2022, it said on Monday, defending its title as the world’s top-selling automaker for a third straight year. Global sales for the group, including truck unit Hino Motors and small-car maker Daihatsu, inched down 0.1% as record overseas sales of 8.6 million vehicles helped offset a 9.6% dip in its home market to 1.9 million. Second-ranked rival Volkswagen Group earlier this month reported its lowest sales in over a decade, of 8.3 million vehicles, as COVID-19 lockdowns in China and the war in Ukraine upended supply chains. Read more: Reuters
The International Monetary Fund on Monday revised upward its global growth projections for the year, but warned that higher interest rates and Russia’s invasion of Ukraine would likely still weigh on activity. In its latest economic update, the IMF said the global economy will grow 2.9% this year — which represents a 0.2 percentage point improvement from its previous forecast in October. The outlook turned more positive on the global economy due to better-than-expected domestic factors in several countries, such as the United States. However, that number would still mean a fall from an expansion of 3.4% in 2022. It also revised its projection for 2024 down to 3.1%. Read more: CNBC
The Biden administration has stopped approving licenses for U.S. companies to export most items to China’s Huawei, according to three people familiar with the matter. Huawei has faced U.S. export restrictions around items for 5G and other technologies for several years, but officials in the U.S. Department of Commerce have granted licenses for some American firms to sell certain goods and technologies to the company. Qualcomm in 2020 received permission to sell 4G smartphone chips to Huawei. Read more: CNBC
The UK economy will shrink and perform worse than other advanced economies as the cost of living continues to hit households, the International Monetary Fund (IMF) has said. The IMF said the economy will contract by 0.6% in 2023, rather than grow slightly as previously predicted. However, the IMF also said that after the Autumn Statement it thinks the UK economy is now “on the right track”. Chancellor Jeremy Hunt said the UK outperformed many forecasts last year. In its World Economic Outlook update, the IMF, which works to stabilise economic growth, said the UK’s Gross Domestic Product (GDP) would shrink rather than grow by 0.3% this year. Read more: BBC News
Like it – or not – it has been three years since the UK left the European Union. Since then there has been a pandemic, swiftly followed by an energy crisis. That has made it hard to decipher exactly what the impact of Brexit has been. The latest data suggest a hit to the economy – but in some unexpected ways. Read more: BBC News
Samsung’s quarterly profits have plunged to their lowest level in eight years as customers snapped up fewer cell phones and laptops. The tech giant reported operating profit of 4.3 trillion Korean won ($3.5 billion) on Tuesday for the three months ended December, down 69% from a year ago. Revenue fell 8% to just under 70.5 trillion won ($57.3 billion), it said in a statement. It was the company’s weakest quarterly profit since the third quarter of 2014, when its smartphone business lost serious ground to competitors. Read more: CNN
Economic activity in China has expanded for the first time in four months as disruptions caused by the abrupt end of its zero-Covid policy appears to be fading. The official purchasing managers’ index (PMI) for manufacturing, which measures activity at factories, jumped to 50.1 in January from 47 in December, according to the National Bureau of Statistics. It’s the first time the gauge has crossed the 50-point mark since September. A reading above 50 indicates expansion, while anything below that level shows contraction. The official non-manufacturing PMI, which tracks activity in the services and construction sectors, surged to 54.4 in January from 41.6 in December, also marking its first expansion in four months. Read more: CNN
Finally, Capital Markets News
In the second week of January 2023, trading on the Lusaka Securities Exchange. There were fourteen company securities that recorded trades of which AECI Mining Explosives was the highest priced. Fridays’ equity trading was the best performance of the week. Trading activity was recorded in AECI Mining Explosives, Airtel, Bata, CEC Zambia, Chilanga Cement, Madison Financial Services, National Breweries, Puma Energy, Standard Charterd Bank Limited, Zambia Breweries, Zambeef, Zanaco and Zambia Sugar as well as CEC Africa on the quoted tier. The LuSE All Share Index (LASI) closed at 7,233.16 points. The market closed on a capitalization of K72,416,350,084.85 including Shoprite Holdings and K37,633,664,644.85 excluding Shoprite Holdings. Read more
In 54 trades recorded yesterday, 14,069 shares were transacted resulting in a turnover of K45,198.28. Trading activity was recorded in CEC Zambia, Chilanga Cement, PUMA, Standard Chartered Bank Limited, Zambeef and Zanaco. The LuSE All Share Index (LASI) maintained it’s close 7,222.94 points. The market closed on a capitalization of K72,371,854,623.44 including Shoprite Holdings and K37,589,169,183.44 excluding Shoprite Holdings.