Econet approaches Zimbabwe Central Bank for US dollar payments

Econet chairman Dr James Myers
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HARARE – Telecommunications giant Econet Wireless Zimbabwe is looking to engage authorities for permission to take payments in foreign currency for some of its products.

In March this year, the Government allowed the use of foreign currency for local transactions through Statutory Instrument (SI) 85 of 2020.

The use of foreign currency for local transactions has been welcomed by businesses, which say this has enhanced liquidity while also reducing foreign exchange risks although there has been some stability from the re-introduction of the Reserve Bank of Zimbabwe (RBZ) foreign exchange auction system on June 23 2020.

“The business continues to pursue opportunities to receive payment of some of its services in foreign currency,” said Econet chairman Dr James Myers in a statement accompanying the group’s financials for the half year to August 31, 2020.

Dr Myers added the group was also pursuing opportunities available on the local market as well as global trends in its quest to transform from being a communications to digital services provider.

The next few years, he said, will be crucial for the business as it embraces the fourth industrial revolution, in which technological innovations will play a key role.

“Our ability to transform the business and swiftly adopt new technologies has been demonstrated as communications technology evolved from GPRS (2G), 3G, 4G (LTE) and now 5G. Based on this strong foundation, the company continues to explore new opportunities presented by the local conditions as well as global technological trends.

“We are now making bold steps to pivot our strategy from a communications service provider to a digital services provider. The company’s strategy has adapted to the changes in the operating environment over the last 20 years,” he said.

Meanwhile, earnings before interest, tax, depreciation and amortization (EBITDA) rose 6,7 percent to $4,8 billion compared to $4,5 billion during the same period last year.

“The business continues to generate adequate cash flows on the back of an EBITDA margin of 47 percent, made possible by strict cost management policies adopted by the business,” said Dr Myers.

Revenue closed the period at $10,1 billion, compared to $10,8 billion in the same period last year. Loss for the period narrowed to $84 million, while basic and diluted loss per share also narrowed to 3,9 cents from 444,1 cents.

The business was weighed down by exchange losses. The group’s engagements with partners has helped create positive relationships with key partners enabling sustainable payments plans with foreign currency commitments.

The net foreign currency position of the group remains positive as a result of the equity holding of the company in Liquid Telecommunications Holdings Limited, valued at US$ 135 million. – Herald