IDBZ guns for $1bn recapitalisation
THE Infrastructure Development Bank of Zimbabwe (IDBZ) says it is aiming towards a recapitalisation base of up to $1 billion in the long term in a bid to meet infrastructure development needs of the economy.
Chief executive officer, Mr Thomas Zondo Sakala, said in a statement accompanying the bank’s financials for the period ended 31 December 2018, that the bank was driving at harnessing partnerships for infrastructure development in line with the country’s economic growth targets as espoused in the Transitional Stabilisation Programme (TSP) and the 2030 middle income vision.
Although the bank’s operations have been significantly affected by the challenging environment, particularly lack of liquidity in the Zimbabwean economy, he said the financing entity has adequate resources to continue in operation going forward.
“The bank is working on a recapitalisation programme in pursuit of its capitalisation targets of $500 million in the short term and $1 billion in the long term,” said Mr Sakala.
“Apart from scaling up the bank’s underwriting capacity, the recapitalisation is intended to bring on board strategic institutional investors who are aligned to the bank’s developmental mandate and who would facilitate access to long term capital suitable for infrastructure investment.”
He revealed that the bank has already raised a total of $127,3 million through the issuance of infrastructure development bonds since the bond issuance programme commenced in 2012.
During the reporting period, Mr Sakala said the bank raised $10,34 million towards project financing activities and more could have been mobilised were it not for delays due to procurement regulatory approvals for some projects.
The IDBZ is already seized with implementation of various infrastructure projects across the country such as the $16,8 million Kariba housing project, $14,2 million Bulawayo students accommodation project, $6,9 million Empumalanga housing scheme in Hwange, $34 million university hostels projects, water and sanitation, transport and institutional housing projects among others.
“The bank is also working on putting together an alternative investment platform, which seeks to pool capital resources from pension funds and other institutional investors for increased infrastructure investments,” said Mr Sakala.
In order to broaden funding sources and build the required critical mass, he said, the bank would accelerate its engagement with regional, continental and international development finance institutions and multilateral finance bodies to establish strategic partnerships. These are expected to facilitate collaboration in preparation and financing of infrastructure projects.
Meanwhile, the entity’s revenue spiked 54 percent to $13 million from $8 million, driven by strong performance in net interest income, said Mr Sakala. The asset base also grew by 212 percent to $590 million from $188 million spurred by receipt of additional capital of $152 million from Government and growth in Public Sector Investment Programme (PSIP) funds earmarked for public infrastructure projects. This resulted in increases in cash and bank balances, as well as increases in money market placements. These positive developments saw the bank recording a profit of $0,8 million as it exited from a loss making position of $581 000 in 2017. Mr Sakala said the $152,9 million capital injection from Treasury in 2018 helped boost the entity’s income generation capacity. DOMESTIC tourists visiting the Victoria Falls Rainforest will now pay RTGS$20 up from RTGS$7 after the Zimbabwe National Parks and Wildlife Management Authority (Zimparks) reviewed entry fees to match the prevailing interbank exchange rate.
The authority said the move was in response to the Monetary Policy announced by the Central Bank recently. Zimparks announced the entry fees adjustment in a statement.
“Kindly note that all parks conservation fees including Rainforest entrance fees have been reviewed upwards with immediate effect. This is in compliance with RBZ’s introduction of new exchange rates between RTGS and the United States dollar,” read the statement.
Zimparks also collects entry fees into game parks. All along entry fees to the Rainforest were pegged at US$7 at a 1:1 rate with RTGS for locals. Those paying in US$ will continue paying $7.
International entry fees remain unchanged between US$20 and US$30 depending on a client’s region of origin. The adjustment has attracted mixed reactions from locals with some accusing Zimparks of making the Rainforest expensive.
Over the years domestic tourism has been playing second fiddle to international tourism.
Some said locals will not be able to enter the Rainforest.
Zimparks said the charges in the previous tariff were calculated basing on the USD and was now being rated according to the prevailing RBZ exchange rate.
Contacted for comment, Zimparks spokesperson Mr Tinashe Farawo said the adjustment was not a fee hike.
“We’re not increasing the price on our products in Victoria Falls and other places throughout the country. As an authority we are sensitive to the concerns of our clients and markets that’s why we are going all out to ensure that we increase our market share in terms of domestic tourism,” Mr Farawo said.
“We’re simply realigning with the current situation when it comes to the issue of currency. We’re concerned to ensure that we have more people who visit and view what we have as a country”.
The tourism industry has been identified as a low hanging fruit with a potential to transform the country’s economy. — @ncubeleon.