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Sri Lankas inflation jumps to 70.2% amidst worst-ever economic crisiss – Business Standard

Sri Lanka’s surged to 70.2 per cent in August from 66.7 per cent a month ago as the island nation is grappling with the worst economic crisis, according to official data released on Thursday.

The National Consumer Price Index (NCPI) which determines how much people spend on a selected basket of goods and services grew 2.5 per cent in August with food prices rising 1.7 per cent and non-foods rising 3.2 per cent.

The non-food surged to 57.1 per cent in August from 52.4 per cent in July as there was a sharp hike in electricity tariffs.

However, the monthly prices eased to 3.2 per cent, from 6.7 per cent in July.

The core prices measured, leaving the volatile items such as food, energy and transport accelerated in August to 60.5 per cent, from 57.3 per cent in July.

According to official data, food prices have risen by 84.6 per cent, compared to 82.5 per cent in July while the changes in prices measured monthly, decelerated to 1.7 per cent, from 4.6 per cent in July.

Earlier this month, the electricity tariff was revised which along with the soaring food prices led to the increase in the national index of consumer prices for August.

According to tax experts, the 15 per cent Value Added Tax and 2.5 per cent Social Security Contribution Levy could contribute to further price increases by at least 22 per cent.

Based on the forecasts, Sri Lanka’s Central Bank said last month that the prices could peak in September before starting to ease thereafter if the global commodities prices remained stable.

In mid-April, declared its debt default due to the forex crisis. The country owes USD 51 billion in foreign debt, of which USD 28 billion must be paid by 2027.

As per the latest World Bank assessment, ranks 5th in the highest food price inflation in the world. It is ranked behind Zimbabwe, Venezuela, and Turkey, while Lebanon leads the list.

The country of 22 million people has been battling shortages of essentials, including fuel, food and medicines, for months after its foreign exchange reserves dropped to record lows, stalling imports and stoking unprecedented public unrest.

The anti-government protests earlier this year forced President Gotabaya Rajapaksa to flee the country in July. He returned to Colombo earlier this month after a new government was formed under President Ranil Wickremesinghe and the anti-government protests subsided.

(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

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Zimbabwe’s sanctions a smokescreen – Bulawayo24 News

LAST week, the United States updated targeted sanctions against Zimbabwean individuals and entities responsible for committing grave human rights abuses, undermining democracy, or contributing to corruption on a massive scale.

The targeted sanctions regime, introduced in 2003, was intended to pressure and isolate those most responsible for political violence and the collapse of the Zimbabwean economy.

Policymakers hoped that establishing concrete disincentives for the worst excesses in the country would stem the tide of authoritarianism and kleptocracy, creating more space for the many Zimbabweans who wish to express their political views without reason to fear, and who support genuine democracy, accountability, and the rule of law.

Nearly two decades on, the sanctions regime has succeeded in inconveniencing some of the most odious actors in Zimbabwe.

But it has not stopped Zimbabwe’s seemingly endless descent into dictatorship and despair, in which a small circle of elites enrich themselves and protect their access to power while the rest of the country suffers.

At the same time, sanctions serve as a handy scapegoat for the elite, who often mischaracterise them as a blanket ban on trade and investment in Zimbabwe and assert that these restrictions, rather than their own mismanagement, are to blame for the country’s troubles.

The result is a disheartening stasis. The individuals and entities on the list continue their repression and self-dealing, offering neither justification for lifting restrictions that target them, nor hope that those restrictions will be sufficient to disincentivise further brutality.

Instead, as the 2023 elections draw closer in Zimbabwe, the situation in the country seems to be getting worse.

Opposition parliamentarians Job Sikhala and Godfrey Sithole are languishing in detention on dubious charges, while their family members find themselves targeted by security services.

Political activists have good reason to fear even worse treatment.

An eyebrow-raising report about the State’s recent harassment of visiting US congressional staffers suggests that the Zimbabwean authorities have no interest in even affecting a façade for outsiders.

They want the sanctions lifted, but also openly intend to continue down a path of violent, repressive, ultimately ruinous governance.

The sanctions have also become something of an irritant in Washington’s relations with other African nations and the issue was among the items on South African President Cyril Ramaphosa’s agenda during his bilateral meeting with US President Joe Biden last week.

Xenophobia is on the rise in South Africa and attempting to address upstream factors pushing migrants across the border makes sense.

But it is difficult to imagine that Ramaphosa or other southern African leaders really believe that Zimbabwe’s economy will recover due to a decision made in Washington.

Would Zimbabweans who fled their dysfunctional country wish to return if only leaders responsible for political violence could do business unencumbered by targeted sanctions?

Would Zimbabwe’s business climate have a positive reputation if only the entities siphoning off State resources were not on a sanctions list?

For too many African leaders, pretending to believe in these unlikely propositions is apparently far more comfortable than acknowledging the rot at the heart of the State, or their own role in enabling it.

All articles and letters published on Bulawayo24 have been independently written by members of Bulawayo24’s community. The views of users published on Bulawayo24 are therefore their own and do not necessarily represent the views of Bulawayo24. Bulawayo24 editors also reserve the right to edit or delete any and all comments received.

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Zimbabwe strikes gold in US – Bulawayo24 News

President Mnangagwa returned home triumphantly from the United States (US) yesterday where he received the backing of dozens of African countries for the unconditional removal of illegal sanctions imposed by Washington and other Western nations, while a group of investment fund managers is lining up multi-billion dollar projects for Zimbabwe.

The group of billionaires and fund managers from the US is expected mid-next month after being charmed by President Mnangagwa who outlined abundant opportunities in the country during an oversubscribed business indaba in the heartland of New York, the world trade and commercial hub.

The President, who was welcomed at Robert Gabriel Mugabe International Airport by Vice President Constantino Chiwenga, Cabinet ministers and service chiefs, said the support from other African states was heartening.

“This time around we had several heads of State from Africa, and in their statements to the United Nations General Assembly, they implored the United Nations to persuade America and Britain to lift sanctions. I think we had about 11 Heads of State who spoke about sanctions that were unjust and illegal and must be removed. So for the first time we had several Heads of State including the chairman of African Union, President Macky Sall of Senegal, and most of the presidents from Sadc made the statements and others from other regions, we are very happy with that,” President Mnangagwa said.

During the UN General Assembly, African countries, notably South Africa, Kenya, Senegal, Botswana, Namibia, Malawi, and continental bodies, Sadc and the AU, spoke strongly against the illegal sanctions that were imposed by the US and her allies at the turn of the millennium to punish Zimbabwe for daring to give land back to its rightful owners.

Apart from the politics, the President’s itinerary also included high-level business meetings with elite investors who now appreciate the true story of Zimbabwe, away from the exaggerations of Western capitals and their local puppets.

The President said billionaire investors and fund managers from the US were eyeing the country’s mining, agriculture, and ICT sectors and will arrive in the country on October 11.

“The group of investors, they were really big boys in the American economy, most of them are very anxious to come to Zimbabwe and invest. They run various funds and the biggest fund was a Mr Davies who runs a US$222 billion fund at his disposal which he wants to come to Zimbabwe with and invest. They were able to analyse the opportunities that are available here in Zimbabwe. I am so happy that a group of them may be coming on the 11th of next month to come and look at the opportunities available in the country both in agriculture, mining and some in ICT.

“We are very happy that there is huge interest in Zimbabwe by the American business community”.

CBZ chairman Mr Marc Holtzman, who facilitated the meeting between

President Mnangagwa, CEOs, company presidents and fund managers, said in his engagements there was a global appetite to do business with Zimbabwe.

“We have several highly important United States based investment fund managers coming to dinner with His Excellency. People in the room will represent billions in investment capital.

“There are people who are really inspired by President Mnangagwa and his Vision to transform Zimbabwe, his openness, opportunities in agriculture, and natural resources. It’s a wonderful occasion,” said Mr Holtzman.

Representatives of the multi-million dollar Mabetex Group, who also met President Mnangagwa, said the President’s “Zimbabwe is Open for Business” policy has piqued their interest and they will soon set up shop in Zimbabwe, to build conference centres, tourism facilities and houses.

In his address at UNGA 77 , President Mnangagwa called for the reform of global financial institutions that have fallen short in addressing challenges faced by developing countries such as climate change, Covid-19 and conflicts.

The President also outlined measures that have been implemented by Zimbabwe, such as massive infrastructure development projects which include dams, energy plants and roads that have broadened the national economic asset base as well as production and productivity enablers, while enhancing regional connectivity and integration.

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Fuel abuse rocks Zimbabwe municipalities – Bulawayo24 News

SEVERAL local authorities are failing to account for thousands of litres of fuel allocated and disbursed for specific projects in an exposé that confirms how corruption is now rife within councils.

Just like parastatals, local authorities have also become havens of corruption that have since been red flagged by Auditor-General Mildred Chiri in her latest report on municipalities and town offices across the country.

According to a report by Chiri on the financial year ended 31 December 2021 presented to Parliament this week, several local authorities have failed to avail books of account for auditing while others failed to account for resources, mainly fuel, given to them for specific projects.

Marondera was one of the many found wanting after failing to account for over
10 000 litres of both petrol and diesel.

“On fuel management, the Council maintained a register for liquid fuel where recipients were signing as an acknowledgement of collection. However, 3 783 litres of petrol and 6 896 litres of diesel were issued without being signed for in 2019,” Chiri said.

“As a result, I could not verify whether the fuel was collected and used for council business. The risk or implication is financial loss due to misappropriation,” the report added.

The Auditor-General recommended that issued fuel be signed for while the local authority management, in response, acknowledged the observation and attributed the lapses in control to a staff shortage in the stores section.

In Bindura, the local authority is struggling to account for fuel meant for the Zimbabwe National Roads Authority (Zinara) projects amounting to 1 054 litres for other council business.

“However, I was not availed with reconciliations or evidence of reimbursement of the fuel. The risk or implication is poor service delivery due to shortage of fuel.

“Council should ensure that fuel is used for the intended purpose,” Chiri said. In its response, council management said a reconciliation of the Zinara fuel usage will be conducted and a reimbursement will be made.

It also emerged the local authority used devolution fuel for its administration purposes and did not maintain a register, exposing the fuel to abuse.

“Devolution funds are meant to spearhead development in communities and as such the council is required to maintain separate records to ensure accountability.”

At least 8 109 litres meant for road maintenance were purchased  using devolution funds, with Chiri insisting there was a risk  of misappropriation of fuel.

He said there was also a risk of failure to meet devolution targets.

In its response, the local authority’s management said the fuel purchased using devolution funds was meant for road maintenance.

“A fuel reconciliation will be done and the fuel meant for devolution used for other administration functions will be reimbursed and redirected towards service delivery.”

In Redcliff in the Midlands province, the local authority has a murky fuel disbursement plan manned by an individual and Chiri said this was subject to manipulation and thousands of litres could be lost in the process.

“There was no segregation of duties as the procurement officer was responsible on the procurement and distribution of fuel. Fuel was distributed through the Trek card system which was administered by a procurement officer. The procurement officer had the rights to move fuel from one card to the other without the cardholder’s knowledge,” Chiri said.

She said the risk of this is financial loss due to fraud and recommended that the procurement and management of fuel be performed by separate individuals.

In Mwenezi, Chiri said the local authority was processing fuel benefits for heads of department outside the payroll and therefore not subjected to tax.

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