Category: News

Zambia: Plans to Revise Minimum Wage Timely

The plans to revise the minimum Wage and Conditions of Employment Act of 2012 for various sectors is not only timely but will help improve the conditions of the working class in the country.

It is for this reason that we appreciate the intentions by the Government to embrace the process of reviewing the minimum wages and conditions of employment to be finalised by December 31, this year, as long as the attendant results are beneficial to the working class in the country.

With the pointers raised in Parliament by Labour and Social Security Minister Joyce Simukoko that the Government was upbeat to review the conditions of service of workers and its overall benefits to the interest of the workers anchored on a rather broad based consultations with social partners and key stakeholders must be concluded.

It is gratifying that the ministry will develop sector specific minimum wages and conditions of employment for the various sectors, progressively with available time-frame.

The meaningful, positive results of the Government's national vision to protect the plight of the workers should be supported with the plans to review SI No. 46 and 47 of 2012 relating to minimum wages and conditions of employment.

We support such positive plans to be implemented in the right course of workers at the lower scale of the employment vector.

Since the minimum wages were last reviewed in 2012 shortly after late President Micheal Sata assumed power offers food for thought for our legislators to revise laws that would add value to Statutory Instruments (Sis) No 45 of 2012 of the minimum wages and conditions of employment (domestic workers) amendment order of 2012.

SI No. 46 of 2012 on minimum wages and conditions of employment (general workers) amendment order-2012, and SI No. 47 on minimum wages and conditions of employment (shop workers) amendment order-2012.

Preparations to hold further consultative meetings with the social partners and other key stakeholders such as ministry of Finance, Commerce, Cabinet office and the Public Service Management Division on the revision of the minimum wages for various sectors are simply the right vector to follow in the wake of some domestic workers, for instance, failing to fend for their families despite reporting for work year-in-out!

We also support the motion by the Labour and Social Security Minister to ensure that Government's vision was to power-up the process of implementing new measures to entail development of sector specific minimum wage and conditions of employment that would take care of sector specific challenges and opportunities.

The need to embrace the spirit of engaging other stakeholders in the labour market was as cardinal as realizing Government's vision to improve the welfare of the working class.

Lest we forget that the minimum wage mostly offered for security guards, domestic workers, among others, was what drives the domestic economy yet we ignore about the welfare of such workforce.

It was Government's ideal to ensure that all those who add value to the economy should be awarded according to their input because any sector of the economy cannot thrive without the value of ordinary workers of communities.

There is need to ensure that the Government reviews legislation governing the role of the third class of workers in society because they are part of the chief contributors of national economic growth, at least by extension.

Zimbabwe: Vendors Vow to Stay Put As Government Launches ‘Clean Up’ Blitz

Harare — Police on Thursday launched "operation restore order" to rid the capital's central business district of thousands of vendors after President Robert Mugabe condemned the bric-a-brac traders.

Riot police, backed by water cannon were out in force across the capital as the campaign started.

The opposition MDC Alliance said the vending crisis was a "result of the economic implosion that has primarily been caused by the ruinous, ill -advised, corrupt and populist economic policies of the Zanu PF regime".

Irate vendors have vowed to stay put, declaring war on government if the blitz continues. They demanded that Mugabe provides them with alternative employment.

The veteran leader demanded the clean-up exercise while addressing youths from his ruling Zanu PF party last weekend, lamenting that the capital had lost its lustre due to the vendor invasion.

However, the furious vendors - many of them Zanu PF members - charged that Government must address the joblessness in the country which is forcing many onto the streets.

Unemployment crisis

Some estimates put Zimbabwe's formal unemployment at around 90%, blaming the collapse of industry in an economic crisis that has lasted more than 15 years.

"Some of us were beaten and had our wares confiscated," said a male vendor who refused to be named, fearing victimisation.

"Government should give us ample time to relocate to alternative places; something like six months to vacate these premises.

"How can they just chase us away from where we are trying to honestly eke out a living? That is grossly unfair because this is where the people are."

"The issue is about the government failing to create employment for the people, which is what has pushed people to the streets. The leadership should address the cause."

MDC-T spokesman Obert Gutu said the blitz would be a futile exercise.

"What Mugabe and his cronies do not appreciate is the fact that they cannot successfully cure a disease by merely rushing to suppress the symptoms rather than curing the root cause of the disease," Gutu said in a statement Thursday.

"For as long as there are no jobs and other viable business opportunities that are open for the majority of the people, the problem of indiscriminate vending will simply not disappear.

"Mugabe can use all the physical might of the Zimbabwe Republic Police to forcibly flash out vendors from the streets but, certainly, this will not mean the plight of the majority of jobless Zimbabweans will suddenly improve.

"Not until the economy starts to rebound and to create more job and viable business opportunities will the problem of indiscriminate vending be permanently and holistically addressed."

Meanwhile, the vendors accused council authorities of double standards and questioned the rationale of paying the US$5 dollars to obtain a vendor's card only to be forced off the streets despite having the requisite documentation from the same city authorities.

Designated trading points

Council spokesperson Michael Chideme said they were not stopping individuals with vending cards from trading but only relocating them to designated points.

"We have set up market stalls where we are relocating the vendors and the stalls are the Simon Muzenda mall, Coca Cola, Market Square, Glen Norah and Copacabana," said Chideme.

However, Vendors Initiative for Social and Economic Transformation Director (VICET) Samuel Wadzai castigated police for their heavy handedness saying there are better ways of dealing with the issue rather than resorting to brute force.

"We condemn the police reaction in the strongest terms as there are channels such as consultations and dialogue," he said.

"We would have expected better pronouncements from the President as the vendors are in the streets because of unemployment.

"For him to just rush and say vendors is illegal without proffering solutions just shows the kind of leadership we have in this country."

Wadzai said they would be back on the streets Friday, next week and next year, adding they would resist any moves to forcibly remove them from the city centre.

South Africa: Warning That Cape Town’s Water Outages Could Cause Solar Water Geysers to ‘Explode’

Water outages to preselected suburbs by the City of Cape Town could lead to solar water geysers "exploding", an electrical and electronic engineer warned on Thursday.

The City on Monday announced that Phase One of its Critical Water Shortages Disaster Plan came into effect which would cause water outages during peak water usage periods in the mornings and evenings.

Residents would be informed before water outages occur.

Professor Thinus Booysen from Stellenbosch University's electrical and electronic engineering department said solar water geysers is dependent on cold water to regulate temperatures.

He said if water in the panel becomes too hot, or pressure too high, the safety valve opens which replaces hot water with cold water.

"In the event of a water outage, no cold water will replace the hot water, which could lead to overheating, and which could result in scalding (when hot water is used and it is beyond 100 degrees Celsius), and the solar system possibly stalling, which in turn could lead to explosions," Booysen told News24.

Bradley McCallum from Skybridge Solar in Cape Town agreed, saying that the lifespan of roof solar water panels decreases drastically if left without water.

He said the panel's absorber plate, which turns solar radiation into heat, will essentially be severely damaged if it overheats.

"It depends on the quality of your solar panel, but in lower quality ones you'll see decreased heat from the panel within two to three weeks."

McCallum warned that the city's plan to decrease water pressure within its system would possibly lead to further damage.

'All speculation at this moment'

He said if water pressure drops to below four bars, the solar water geyser is not going to operate.

"What would happen is that the valves won't open up which means water won't enter the panel to regulate the temperatures. The geyser won't be receiving new cold water to heat during that time.

"This is all speculation at this moment, the city is still implementing lower pressure and this is the first time we are encountering this kind of problem."

Sokolic Solar owner Andrew Sokolic said the glass tubes within solar panels are specifically susceptible to cracking when suddenly filled with cold water.

The issue could damage the geysers of thousands of solar water geyser owners across the city, Sokolic said.

The City of Cape Town failed to respond to detailed questions sent on Tuesday.

Gloria Mdleleni from Sustainable Energy Society of Southern Africa (Sessa) said the only way for solar water geyser owners to protect their solar water geysers is to cover up the panels until the water supply is restored.

Unlike an electrical geyser, a solar power geyser "can't be switched off", Mdleleni said.

Mdleleni, however, said no cases of solar geyser damage through water rationing have been reported.

"We will have to wait and see," she said.

Kenya: Kisii Building Collapse – Rescue Operation Called Off

One person remains unaccounted for as emergency teams called off rescue operations in Kisii where a building collapsed killing seven people.

A three-storey building under construction collapsed at Mwembe on Wednesday morning.

Rescuers, mostly using rudimentary tools, pulled more than 20 people from the rubble and rushed them to the nearby Christa Marianne Mission and Kisii Teaching and Referral hospitals.

NO HOPE

The team consisting of the Red Cross, the military and Kisii County Disaster staff combed through the debris throughout the night before the exercise was terminated Thursday morning.

The National Disaster Management Unit Communications Officer Pius Maasai said chances were slim of finding more survivors.

He said a man was still missing by close of the rescue operations at 4.30am.

A woman was pulled out of the rubble last night after rescuers heard her calling for help.

More than 20 people are admitted to the Kisii Teaching and Referral Hospital and another five to Christa Marianne.

First witnesses at the scene said they saw several people on top of the building before it came tumbling down.

Mr Julius Orare, who lives a few metres from the collapsed building, said he was taking a shower when he heard a tremor.

"I peeped through the bathroom window and saw the building in a heap," he said.

A survivor, Mr Fidelis Onduso, who is nursing injuries, said he heard a huge bang.

"When I looked up, the house fell on me but luckily I was saved by well-wishers who rushed me to hospital," he said.

Kenya Enjoying Impact of Digital Innovation

Nairobi — AN expert is encouraged at the uptake of digital innovation in Kenya, among other East African countries. Gilbert Saggia, the Managing Director: East Africa at SAP Africa, pointed out Kenya has made a significant progress in areas like cloud adoption, which were beneficial to the economy. "Kenya, and East Africa in general, is enjoying the positive impact of digital innovation," Saggia said. He said for example, companies like Kenya Electricity Transmission Company had automated their business processes by moving entire infrastructure transmission projects from manual to SAP HANA.

"This is a positive stance to demonstrate that the country need to run smarter and efficient," Saggia said. On the other hand, Commercial Bank of Africa's investment in its workforce is yielding high returns. It started with the integrated SAP SuccessFactors platform, which allows CBA to plan, reward and retain its human capital, track performance against targets and engage in continuous learning and development.

Roopa Karemungikar, Managing Director of Altura, an SAP partner, said the ability to align all business processes across different countries would help CBA reduce paperwork, increase productivity and automate the bank transfer of salaries. With the internet of things (IoT) disrupting the African market, industry analysts, Frost & Sullivan forecasted significant growth within Kenya's ICT market in 2017.

This would be fuelled by connectivity and convergence. Services at the Mombasa port are improving and much faster following Kenya Ports Authority's switch to a new operational system. This has placed the port at 70 percent in the journey towards becoming a paperless port. The African Digitalisation Maturity Report indicates that Kenya has an extensive ICT infrastructure including mobile internet access. The country is more diverse and services centric which helps drives the expansion of digital services. - CAJ News

Kenya: Why Kenya’s U.S.$40 Billion Debt is Worrying Observers

International credit rating agency Moody's expects Kenya's debt to rise to 60 per cent of GDP by mid-next year, heralding higher financing costs for the private sector.

Moody's expects the government debt burden which stood at 56.4 per cent of GDP by June this year, to continue rising due to high budget deficits and interest payments.

The agency is concerned by Kenya's rate of accumulating debt that it has started looking at whether it needs to lower the country's ability to repay debt, in what is referred to as credit rating.

A downgrade in national credit rating would make it difficult for Kenyan companies to source cheap funds from international markets while also forcing commercial banks to hold higher bad loan loss provisions in line with the new accounting standard that is expected to take effect in January.

That would force them to raise interest rates and, with current regulatory ceilings, to reduce credit to riskier segments of borrowers.

"Unless a decisive policy response is introduced, the upward trajectory in government debt will see debt-to-GDP ratio surpass the 60 per cent mark by June 2018," said Moody's.

Currently the debt position is Ksh4 trillion ($40 billion) as per data from CBK which is more than double what the Jubilee administration inherited, Ksh1.7 trillion ($17 billion) in 2013.

The government has taken up commercial debt, which has seen its interest payments rise to 19 per cent of its revenues, up from 10.7 per cent when the Jubilee government came to power.

Kenya has gobbled up debt as Treasury Cabinet Secretary Henry Rotich sought to fund ambitious development projects steered by the Jubilee government amidst weak revenue collection.

"Due to the erosion in government revenue intake in the last five years and increased recourse to debt from private sources on commercial terms, government debt affordability has deteriorated," notes Moody's.

Liquidity problems

If Moody's downgrades the country from its current rating of B1, investors will be forced to increase the price of their cash to the economy as they factor in a higher risk premium. Higher prices may scuttle government plans to issue a new sovereign bond through which it plans to raise $2 billion in the current financial year.

Commercial banks will also be forced to hold higher provisions for loan defaults following the introduction of new accountings standard (IFRS 9) which requires banks to consider the possibility of government defaulting on its Treasury bills and bonds.

Moody's believes that the Kenyan government may get into liquidity problems due to high loan repayments which may force it to source new and expensive debt to ensure it does not default.

"A key area of focus in the rating agency's liquidity analysis is the government's increasingly large roll-over of Treasury Bills, which amounted to 9.4 per cent of GDP in June 2017, and the external debt payments to private creditors, including the $750 million Eurobond due in June 2019," said Moody's.

Fitch, another international rating agency, has also indicated that it could downgrade Kenya's credit rating due to its debt position. Fitch had noted that the country was spending a larger proportion of its revenue in paying debt, compared with its economic peers such as Uganda, Rwanda and Ghana.

Fitch gave Kenya a B+ rating with a negative outlook due to the country's debt position.

Kenya, however, insists that its debt is manageable and has headroom for more. Mr Rotich believes that Kenya can comfortably borrow up to 74 per of its GDP.

Rwanda: Public Agencies Join Hands to Fight Illegal Forex Market

Three public agencies have teamed up to tackle the growing black market forex operations in Kigali.

The new coalition comprises the central bank, Rwanda National Police and the Local Government ministry, according to officials.

The partnership comes amid widespread concerns over the growing black market operators in the forex business in different parts of the country.

The New Times recently highlighted how the operators were thriving in the city.

The recent increase in operations has been partly blamed on the tightening of regulations in the sector, which forced out small operators and led them to operate illegally.

Central bank governor John Rwangombwa said the inter-agency partnership will activate operations to rid the city of black market traders as well as sensitise them to form associations.

He said there is some black market activity at the moment but downplayed it as 'not that big a threat'.

"The stability of the market we see today gives us confidence that the problem is not big," he said.

Rwangombwa said black market operations are often successful in instances where there is shortage of foreign exchange among registered operators.

The central bank injects about $5 million weekly to support demand from international trade.

"Black markets are often successful where we have a shortage of foreign exchange in the formal set up, we do not see that in our market today, we sell dollars in the market to support the demand of international trade," he said.

The New Times has also learnt that beyond 'small scale' black market operators, who are common at border points and in the capital Kigali, there are also large scale operators who often deal with corporations and business people to change large sums of money.

These larger scale operations often thrive due to lack of capacity and flexibility by banks of facilitate currency change, especially of large volumes of money at negotiable rates.

Police say that they are working with stakeholders to enforce the law. In a recent interview with this paper, Police spokesperson Theos Badege called on the public to report such cases.

"We work closely with the central bank and the licensed forex bureaus to protect our currency. Law enforcement operations have been focusing on Kigali city, especially around the old post office area, and at major border points. We urge the public to report such malpractices," he said.

City of Kigali spokesperson Bruno Rangira added that such illegal operators in Kigali and their clients will face arrest just like hawkers in the city.

Ethiopia: Govt Devalues Currency, Raises Interest Rates

In the midst of a Forex currency crisis, the National Bank of Ethiopia (NBE) has devalued Birr by 15pc and raised the interest rate by two percentage points to seven percent. The devaluation pegs the Ethiopian Birr at 26.91 to the dollar, up from 23.40 Br on the official market. It will be effective from tomorrow, October 11, 2017.

The Central Bank justifies the move as an effort to control the inflationary pressure and prop up export earnings. The export proceeds have been stagnant at around three billion dollars for the past three years, whereas inflationary pressure has been in the double-digits for the past two months, having reached 10.8pc in September 2017.

Yohannes Ayalew (PhD), vice governor and chief economist at the Central Bank, announced the adjustment today in a press conference where only the state media was invited to attend.

Seven years ago, the government had made a 17pc devaluation resulting in inflation that had reached as high as 40pc.

"Since investment return is high in Ethiopia, the devaluation won't cause an inflationary pressure and adversely affect import," said Yohannes.

For more than half a year, the official exchange rate stood at around 23 Br to the dollar, while black-market traders sold a dollar for nearly 29 Br.

The current devaluation surfaced almost 11 months after the World Bank (WB), in its fifth economic update, suggested the government devalue the currency to raise the country's competitiveness in the global arena. The recommendation, however, was rejected at the time by Yohannes, although the real effective exchange rate (REER) has appreciated in cumulative terms by 84pc since the nominal devaluation in October 2010.

Ethiopia: Central Bank Issues Directives to Harmonize Devaluation

The nation's commercial banks are told to transfer 30pc of their foreign currency earnings to the central bank, part of a series measures regulators took to complement the devaluation of the Birr against a basket of major currencies.

The National Bank of Ethiopia (NBE) has devalued the Birr by 15pc, hoping to see exporters encouraged to sell more.

The big prize goes to exporters. In a directive issued on Monday, exporters are privileged to retain 30pc of their export earnings, an amount which has been at 10pc. However, they are told to spend their retaining of forex on imports only related to their businesses.

The directive, which instructs banks to transfer all the "windfall profit" from currency adjustment, is seen by authorities complementary to the devaluation of the Birr effective as of today, October 11, 2017. During the past devaluation, seven years ago, the payment demanded from the banks was only 75pc of their windfall earnings.

The transfer was made in a bid to reduce the burden on the Commercial Bank of Ethiopia (CBE) in the allocation of Forex for the procurement of strategic goods such as petroleum and sugar, and payments made to cover the country's bills for shipping imported items, according to a source close to the case.

Ethiopia: Nation Expects Hike in Sesame Export

The country has earned about 307.5 million dollars from the export of sesame in the past fiscal year- the lowest in five years. Hoping there will be no further decline, the Ministry of Agriculture & Natural Resources (MoANR) plans to uplift the revenue from the export of sesame by 16pc in the current fiscal year.

Most of the problems occurred during the harvest of the seeds, according to Tesfaye Mengiste, state minister of MoANR. The process is labour intensive and the method of harvesting should be improved to prevent wastage. Seasonal health problems such as malaria, which affect majority of the labour force during the harvesting season contribute significantly to the low productivity of sesame.

Last year, the country exported 280,473tns of sesame to the international market; this is expected to increase by 20pc and reach 336,742tns this fiscal year, according to the Ministry.

At present, the Ministry is working to reform the sesame market as it did with coffee. The reform is expected to reduce the involvement of Ethiopia Commodity Exchange (ECX) in the market.