By Juma Mohammed

Zanzibar — Zanzibar Petroleum Regulatory Authority (ZPRA) has pegged at eight years, the minimum period to start commercial exploration and production of oil and natural gas in the Isles.

Speaking to Senior Government Officials in South and North Pemba regions, ZPRA Deputy Director General, Engineer Ali Bakar said the survey of oil and natural gas was going through various stages, pleading for patience.

He said there are six steps before commencing the formal drilling and sales of oil but Zanzibar is still on the first of the costly steps.

“The cost of getting data of oil is too high … the work of gathering the information you need costs about 20 million US dollars,” said Engineer Ali, emphasising that the business of oil and natural gas extraction requires large capital.

He said the cost of drilling a well at sea during the survey costs 150 million US dollars (over 300bn/-) and therefore the undertaking requires huge investments.

“You may dish out such large amount of money and yet find out that the available deposits are not commercially viable,” said the deputy DG. Commenting on the survey of oil in Zanzibar-Pemba block, ZPRA Director General Omar Zubeir said the work will start soon using special ship and vehicles.

“Under this phase, experts will use special technology to find the sedimentary rocks, this will take place after the initial surveys, using special plane to identify the sedimentary rocks, are complete,” said DG Omar.

He hinted that rocks with oil reserves are within the distance of between three and four kilometres below the earth, adding that there is the distance of up to six kilometres before reaching the sedimentary rocks with thermal storage.

Speaking at the meeting, Regional Commissioner of North Pemba, Omar Khamis Othman said the region will offer all the required cooperation for successful survey work.

Regional Commissioner of South Pemba Mwanajuma Majid Abdalla said that there was need for people to be well informed about the entire work of exploration and extraction of oil and natural gas, saying many people have many and sometimes unrealistic expectations.

Airborne Gradiometer Full Tensor Gravity Survey (FTG) was completed last month, with FTG conducted by Bell Geospace Enterprises Company Limited of the UK.

The Second Vice-President, Ambassador Seif Ali Iddi, launched the survey in March, this year, with Bell Geospace Enterprises Limited conducting the survey on behalf of GAS RAK Ras Khaimah, from the United Arab Emirates.

By Donah Mbabazi

Army veterans have ventured into real estate business with an aim of availing affordable housing for low income earners.

In partnership with the Development Bank of Rwanda (BRD) and Rwanda Housing Authority, Abadahigwa Ku Ntego Ltd, the real estate project initiated by the veterans, has managed to construct 32 housing units so far.

Initiated in 2014, the project invested Rwf800 milion and each house costs Rwf18.6 milllion, constructed in the first phase.

Wilson Rukundo, the managing director of Abadahigwa Ku Ntego Ltd, said they conceived the idea in order to partake in providing affordable houses for all people, especially for low-income earners.

“The project was initiated after identifying a challenge of inadequate affordable housing, especially for low income earners,” he told The New Times last week.

“This is the first phase. About 30 other housing units will be constructed in the second phase. We also have two and a half hectares of land in Mbandazi in Gasabo District, where we intend to build around 40 houses in the near future.”

Situated in Kabuga, each house has three bedrooms with two toilets and bathrooms inside, a kitchen and store, sitting room and dining room, with a rainwater tank.

A 2012 Housing Market Study in the City of Kigali showed that 340,000 new housing units are needed by 2022.

Of these, 86 per cent should be affordable and mid-range housing units, 13 per cent social housing while only less than 1 per cent would be premium housing.

The Government has prioritised the development of affordable housing for middle- and low-income communities.

Vision 2020 targets urbanisation rate to increase from 17 per cent of the population in 2012 to 35 per cent by the year 2020.

By then, the urban population is projected to have increased from the current 1.7 million to 4.4 million, an increase of about 2.7 million people.

By Peter Adamu

The World Bank’s Board of Executive Directors yesterday approved a $200 million International Development Association (IDA) credit under the IDA17 Scale-up Facility for Zambia to improve selected rural roads in six of Zambia’s ten provinces.

Government will finance the remaining four provinces.

According to the Rural Access Index, only 17 percent of rural population live within 2 km of a good road in Zambia, leaving about 7.5 million rural residents unconnected to the road network in the country. The Improved Rural Connectivity Project will benefit 460,000 people in the targeted rural areas.

World Bank Country Manager for Zambia Ina Ruthenberg notes in a statement that the Improved Rural Connectivity Project is significant for Zambia, because it will improve connectivity in rural areas where poverty levels are particularly high.

Ruthenberg says besides the project providing improved connectivity to schools, markets, health facilities, and jobs for the rural communities, it has the transformational potential of positioning Zambia as the regional food basket, contributing towards economic diversification.

And World Bank Senior Transport Specialist Justin Runji says the project will also contribute towards addressing institutional capacity challenges, particularly in the area of road maintenance and road safety in Zambia, where feeder roads are largely in poor condition.

The project supports the Government’s development priorities as reflected in the National Development Plan and Vision 2030.

By Abubaker Mayemba

11.36 million SIM cards have so far been verified by the National Identification and Registration Authority (NIRA) ever since the exercise began a fortnight ago.

On April 11, following assassination of police spokesman Andrew Felix Kaweesi, government directed that all SIM cards be validated using the citizens’ National Identification Numbers (NIN). Foreigners were required to verify their SIM cards using passports.

Updating journalists today about how far the exercise has reached, Clet Turiho, the director Information and Communications Technologies (ICT) at NIRA revealed that they had verified 11.36 million SIM cards. These were part of the 13 million submitted by the telecom companies.

“Of the 13 million registered numbers we got from telephone companies, we have verified 11.36million SIM cards,” Turiho said on Monday at the Uganda Communications Commission (UCC) offices.

Commenting on instances where people register SIM cards using different identities, Godfrey Mutabaazi, the UCC executive director, said they would easily be traced and apprehended using sophisticated technology. During registration, the applicants’ biometrics and facial features are captured, authorities will majorly base on these to trace impersonators.

“Whatever crime is being committed now it should be cleaned up because in a couple of days, that will be identified. You cannot keep deceiving NIRA for long because this technology is available to trace all these issues and other technologies are coming,” said Mutabaazi.

Adding: “We shall get you because there is technology to do that. If you have bypassed the system. You will be captured during the sieving period.”

After May 19, NIRA will embark on another verification phase to match all submissions.

No extension

After public outcry that the required validation period of one week be extended, government succumbed to pressure and obliged. Dr Ruhakana Rugunda, the prime minister, ordered the deadline be extended for one month to May 19, to allow all people to validate their information.

However, this time round, an extension is unlikely to take place since there has been positive response from mobile users. Henry Tumukunde, the Security minister, emphasised that there would not be an extension of the validation dates. He urged all SIM card owners to verify them before they are disconnected.

“Ugandans want things to be done the Ugandan way but we are not doing that this time.”

By Simon Echewofun Sunday

Electricity tariff may rise in July as the Federal Government considers options to revive the ailing power sector by injecting $7.6 billion (about N2.4 trillion) in five years.

The details are contained in the Power Sector Recovery Plan (PSRP), a document formulated in March by the Office of the Vice President and the World Bank Group (WBG). The Working Group for the implementation is being coordinated by the SSA to the President on Power at the Office of the VP, Damilola Ogunbiyi, and the Lead Energy Specialist at WBG, Kyran O’Sullivan.

The federal government considers recovering the $7.6bn fund by way of hiking the present electricity tariff outlined in the Multi Year Tariff Order (MYTO) 2015. It has considered four options and the Working Group is making a decision on which of the hike options to adopt shortly, the Daily Trust learnt.

The first tariff hike option is to freeze tariffs for all classes of electricity customers until July 2019. Although the present administration may have left office then, government still believes this decision will help it recover the N2.4trn ($7.6bn) it is sinking into the sector from now to 2021.

Option B of the PSRP is to hike tariffs for all classes of customers by January 2018. This it said will fetch about N1.7trn (about $5.4bn) of the fund to be spent in the 5-year period. However, a balance of $2.2bn (N697.4bn) may not be recovered within the period.

The third tariff hike option which is the most urgent is to increase tariffs in July 2017 (two months from now). This decision if taken will fetch the federal government about N1.3tr ($4.1bn) to support the sector in the 5year period. Government may still have to contend with recovering $3.5bn (N1.1trn) balance.

The fourth option is to hike tariffs by 50 per cent in July 2017 for industrial customers only. The non-vulnerable residential and low commercial customers will see the hike by January 2018 while the vulnerable ones (customers in the lowest class) will see a hike by July 2019. Government believes taking the decision could raise N2.3tr ($5.9bn), leaving a balance of $1.7bn (N538.9bn).

The PSRP team’s survey tests these options to determine the support from the public and the political backings. The research shows that Option 3 of hiking tariff in the next two months to generate N1.3tr will have zero political and public support, but with high support from the $7.6bn intervention funders (mostly AfDB and WBG).

Option 1 to generate N2.4tr will have medium political and public support, with low support from the funders.

Option 2 which will fetch N1.7trn FG support will have low support from politicians and public and a medium from the funders; Option 4 (N1.9tr) tariff increase for industrial customers only will have medium political support and high support from the public and the funders (lenders).

Government traced causes of the present liquidity crisis in the sector to consumers’ apathy to pay bills in post privatisation, poor regulatory compliance, foreign exchange fluctuations, vandalism among others.

It said the result was epileptic power supply that causes the Nigerian economy to lose $29.3bn (N9.2trn) annually. The factors have also caused an electricity market shortfall of N470bn and a tariff shortfall of N458bn between 2015 and 2016.

Government which still has a 40 per cent stake in the power sector utilities privatised on November 1, 2013, plans to spend $1.5bn (N475.5bn) annually from 2017 to 2021, estimated at $7.6bn in five years.

To source this fund, the exclusive report shows that there will be budget allocation of $3.50bn (N1.1trn), the sales of 10 plants under the National Integrated Power Projects (NIPPs) for $2.1bn (N665.7bn); sourcing loans of $1bn (N317bn) each from the African Development Bank (AfDB) and the World Bank during the period.

The Daily Trust analysis reveals that on the statutory budget, about $700 million (N221.9bn) must be allocated annually till 2021 to meet this specific target. The 2017 budget proposal presently before the National Assembly has N564bn allocation for the power sector which is N343bn higher than the annual benchmark, if specifically directed to the recovery targets.

Experts differ on implementation, tariff hike

In his views, Mr. Emeka Okupara of Nextier Power, a power sector advisory firm in Abuja told our reporter that there should be an independent body to implement the PSRP. He said, “I believe there needs to be an independent and competent body that have the authority to be able to sanction any group that is not conforming.”

For the tariff hike plans, Okupara said such immediate attempt will receive a huge kickback from the public. “Increasing the tariff may not change anything if the collection deficiency is not addressed. The Distribution Company (DisCos) would need to do a better job on their collections before you talk increase.

Electricity sector advocate and analyst, Mr Kunle Olubiyo said before the injection of funds, the sector must take three immediate approaches: “Escrow the account of the operators for three months for a midterm forensic audit to determine the Inflow and outflow to know what should be supported from experts’ review of the Aggregate Technical, Collection and Commercial (ATC & C) losses,” he advised.

From her perspective, Mrs Joy Ogaji, a former official of the Presidential Taskforce on Power (PTFP), a public sector monitor said there was need to first get the market to the point of bankability and commercial sustainability.

She said, “Without the private sector, government finances are not sufficient to maintain the grid given other socio-economic needs yet alone to grow and expand it.”

On the PSRP implementation, she said it must have been thought out by the Coordinating Team adding that, “There may be no vacancy at Aso-Rock but ministers, DGs, and CEOs do come and go. An independent body would provide continuity and focus.”

By Daniel Nemukuyu

Harare City Council has been dragged to court over failure to pay one of its service providers a debt amounting to $407 000.

Fairclot Investments, which trades as Trucking and Construction Civil Contractors, hired out its construction equipment and supplied construction services and goods to the local authority.

In terms of the agreement, council was supposed to pay for the services, equipment and goods.

Council reportedly failed to pay the debt, resulting in the construction firm approaching the High Court with a claim.

In the summons filed by Mutumbwa, Mugabe and Partners, Fairclot is claiming a total of $407 214,83 plus interest calculated at the rate of five percent per annum from the date of issuance of the summons to the date of payment of the debt in full.

According to the plaintiff’s declaration, between April 2015 and July 2016, council engaged Fairclot on different intervals for the supply of construction goods, equipment hire and construction services for road construction projects.

The services, equipment and goods were supplied to the local authority on the strength of an agreement.

A bill of $407 214,83 was sent to council, but no payment was made.

Despite demand, council has failed or refused to pay the debt.

Fairclot was indicated in the declaration that it was forced to engage in expensive litigation and that council must pay the costs of the suit on a higher scale. City of Harare is yet to respond to the claim.

By Barbara Maregele

Mining company accused of damaging West Coast is claiming over R1 million in damages from activists

Australian-owned mining company Mineral Commodities Ltd (MRC) is suing a West Coast community activist and two Centre for Environmental Rights (CER) attorneys for defamation. The company is claiming over R1 million in damages.

Advocacy group Right2Know has vowed to protest at the Department of Mineral Resources and at the Australian embassy against what it calls “dodgy business dealings” by MRC.

MRC has been marred by controversy for its attempts to mine mineral sand at Xolobeni on the Wild Coast and its ongoing court battle over its Tormin mine on the West Coast near Lutzville.

In a statement on Friday, the CER said that attorneys Tracey Davies and Christine Reddell as well as community activist Davine Cloete are accused of making defamatory statements about MRC’s subsidiary company Mineral Sands Resources (MSR) and its director Zamile Qunya during presentations at the University of Cape Town in January this year.

Davies, Reddell and Cloete were doing a presentation about MSR’s “destructive” sand mining at its Tormin sand mineral mine on the West Coast. The CER has said that the summons was a way to intimidate activists and discourage others from speaking out against the mining giant.

“MSR has claimed R250,000 in damages from each attorney, and a further R750 000 from Cloete. Lawsuits against public participation are aimed at sending a message to all activists that resisting the company, and others like it, poses personal risks,” the CER said.

The CER said that it was not the first time MRC sued activists. “Last year, MRC and its CEO Mark Caruso sued Cape Town attorney Cormac Cullinan, Amadiba Crisis Committee activist Mzamo Dlamini, and John Clarke, a social worker, for defamation in relation to the company’s involvement at Xolobeni. These claims are being defended,” the CER said.

Right2Know’s Allison Tilley said they would decide on a way forward after a public meeting expected to take place in Lutzville on Wednesday. “It is clear that Qunya and MRC are now employing scare tactics against the lawyers who are providing legal assistance to the anti-mining activists. We stand in solidarity with CER and Cloete as they continue to challenge corporate corruption, fight for environmental justice and speak truth to power,” the organisation said.

CER will be opposing the summons. MRC spokesperson Anne Dunn said the company will not be responding to questions on the matter.

By Philomena Matsiko

Kampala — The price of sugar has steadily risen across East Africa, leaving producers and consumers with a sour taste in the mouth.

In Uganda, it has risen from $0.98 (Shs3,560) to settle between $1.21 (Shsh4,395) and $1.41 (Shs5,122) per kilogramme over the past year, with producers blaming the high cost of producing sugarcane for the increase.

Mwine Jim Kabeho, chairman of Uganda Sugar Manufacturers Association, in a letter to the Ministry of Trade, Industry and Co-operatives, said that the average cane price has almost doubled, from $23.8 per tonne in April 2016 to $44.8 per currently. “The wholesale prices have continued to rise, so we are forced to increase the retail prices,” said Mr Abdul Lwanga, a wholesale sugar trader in downtown Kampala.

The USMA said the adjustment was due to the higher production costs and to sustain the value chain. However, some traders have taken advantage of the changes, with some raising their margins from $0.6 per 50kg to $5.6 per bag.

Cost per unit

The industry also notes other challenges as being shortage of cane. “Sugar production is below half of the installed capacity, thereby increasing the cost per unit; this will automatically be reflected in sugar prices,” the association said.

Harvest of immature cane is another factor that the industry attributes to failure to implement a zoning policy. “The USMA has constantly drawn the attention of the ministry to this, small mills have continued to be established in close proximity to old mills” without investing in out-grower schemes. They instead offer incentives to farmers to lure them away from the established factories, leading to harvest of immature cane. Inflation, speculation and high taxes are cited as the other causes.

The association was responding to a note from the ministry that demanded an explanation for the price increase.

Trade and Industry Minister Amelia Kyambadde has long been locked in a battle with the sugar manufactures over price and production figures. While established manufacturers want exclusion zones to protect their outgrowers, the government has looked on and in some cases encouraged the opening of new factories, some of which do not even grow their own cane.

By Henry Lyimo

President John Magufuli has said banks are partly to blame for the rising rate of default on loan repayment as they did not carry out proper due-diligence before lending.

Speaking at the 10th National Business Council meeting in Dar es Salaam on Saturday, President Magufuli said had the banks carried out their homework properly they would not be struggling with the rising rate of non-performing loans which reached an average of 9.5 in the first quarter of this year above industry benchmark of five per cent.

“Unless you change, the problem will persist,” he said at the 40-member dialogue with equal representation from the private and public sectors.

Three banks have over 50 per cent of non-performing loan ratio in this year’s quarter one as banks loan repayment default rate have soared to record high.

President Magufuli said Tanzania Agricultural Development Bank, which is struggling with high rates of defaults was an example of banks which did not carry out proper due diligence to borrowers before lending and had provided loans to nonagricultural activities.

He said the government was making efforts to beef up capital for the bank but it was disappointing to see the bank providing loans to nonagricultural activities.

TADB was launched in 2015 to provide short, medium to long-term financing to the agricultural sector. He decried a growing tendency by some people to acquire big chunks of land for investments in large scale agriculture but end up using the tracts as collaterals to secure loans which are used for nonagricultural purposes.

He said the government would not allow the tendency to continue because it is not in the best interest of the nation. President Magufuli also accused some greedy traders of hoarding sugar, expecting to cash in on artificial shortage, few days before the beginning of the holy month of Ramadan.

He said the government had issued sugar import permits to local producers in efforts to solve the problem of hoarding by importers but it had not worked as they had eventually sold the permits to the same importers.

He earlier said the government had confidence in the private sector except for a few dishonest businessmen who are involved in corruption and tax evasion. The massive crackdown on corruption and tax evasion by big businesses should not be construed as the government had lacked trust in the private sector, he said.

“I know the government that I am leading trusts the private sector except, perhaps, for a few tax cheats… ” he said at the meeting that involved members of the business community and the government leaders.

His response followed remarks put earlier by the Chairman of the Tanzania Private Sector Foundation (TPSF), Reginald Mengi that there seems to be lack of trust between the government and the private sector based on a misconception by some government leaders that all the business people are bent on breaking the law and evade tax.

“This is not true. The truth is there are a few among us who have the bad habit of evading tax and breaking the law. But most of us respect the values and laws and we pay the required taxes,” Mr Mengi said, adding it was important to debunk the wrong notion as soon as possible so as to build a strong private sector.

President Magufuli said the government understood there were a few dishonest traders who are involved in shoddy deals and corruption.

He said the on-going crackdown on corruption and sleaze in the government was important on the development of the private sector because it levelled the playing field among traders in various sectors.

“A few traders were evading tax and were colluding with some figures in the government and in the Tanzania Revenue Authority (TRA).

These became very powerful and were frustrating businesses. So if these are people complaining about lack of trust from the government, yes, they are right,” he said. “But majority are trustful business people. I want to assure you that the government will cooperate with you by 100 per cent.”

By Terhemba Daka

Abuja — President Muhammadu Buhari yesterday met with the Governor of Central Bank of Nigeria (CBN), Godwin Emefiele, at the Presidential Villa, Abuja.

Addressing State House Correspondents shortly after the closed-door meeting, Emefiele said their discussions centered on the state of the economy and the continued instability in the country’s foreign exchange market, which he said, had impacted negatively on the value of naira.

Emefiele said he also briefed the President on other sundry issues, including what the apex bank was doing to stabilise the foreign exchange market.

The CBN governor, who described the country’s economy as “looking good” with the rise in crude oil price “oscillating between $50 to $55 and $56” per barrel, said the development at the international market was a boost to the stability of the naira.

He said: “Basically, as it is expected, what we normally do is from time to time to brief the President about activities of the Central Bank of Nigeria, particularly at this time as it relates to the efforts the apex bank is doing to stabilise the forex market.

“And we briefed him regarding the activities so far and he was very delighted to hear that the market is stabilising at the level that it is right now and I am saying the parallel market currently stabilises at between N380 and N385.

“Our responsibility as Central Bank of Nigeria is to do what we are doing at this time. Nigerians or importers, people who need foreign exchange to do businesses… and given the fact that we are able to increase our forex revenues, the natural thing to do is to make the foreign exchange available to those who need them to import or to carry out eligible transactions.”