Edcon Holdings Ltd.’s administrators are fast-tracking a plan to sell all or parts of the business to keep South Africa’s second-largest clothing retailer in operation amid the Covid-19 pandemic.
Interested buyers will be invited to carry out due diligence with binding offers expected by the end of June, according to a rescue plan released on Tuesday. Salaries have continued to be paid through this month and remain a priority, according to the plan. Johannesburg-based Edcon has at least 18,000 workers, with suppliers employing thousands more.
The owner of the Edgars and Jet chains filed for administration last month after losing 2 billion rand ($119 million) in sales as a result of South Africa’s lockdown to contain the new coronavirus. Clothing stores were among those forced to close for five weeks through April, and were only allowed to open with limited ranges in May.
The company had been struggling before the crisis, securing 2.7 billion rand from lenders, landlords and the Public Investment Corp. in a 2019 restructuring plan that freed the retailer of all interest-bearing debt. South African consumer spending has been lackluster for several years as weak economic growth and high unemployment eroded disposable income.
Administrators led by Piers Marsden and Lance Schapiro opted for a sale plan after finding no investors for the business. A successful transfer of ownership will at least save some Edcon jobs, they said.
Gold production in Democratic Republic of Congo continues to be systematically underreported while tonnes of the precious metal is smuggled into global supply chains through its eastern neighbours, a United Nations report has found.
The countries along Congo’s eastern border have long been conduits for gold worth billions of dollars mined using rudimentary means by so-called “artisanal” miners.
Difficult to trace, trade in the precious metal has fueled regional wars, funded rebel fighters and led to UN sanctions on traders involved in a bid to staunch the flow.
North Kivu, South Kivu and Ituri provinces reported official production of just over 60kg of artisanal gold in 2019, yet exported a total of just over 73kg, the UN Group of Experts on the Congo found in its annual report.
The group estimated that at least 1.1 tonnes of gold were smuggled out of Ituri province alone in 2019. That would have earned the government up to $1.88 million in taxes had it been legally exported.
Across all gold-producing provinces the loss is likely much greater. Artisanal miners in Congo produce 15 to 22 tonnes of gold a year, Germany’s Federal Institute for Geosciences and Natural Resources has estimated.
“The country remained one of the Great Lakes region’s largest artisanal gold producers, and yet one of its smallest official exporters,” the Group of Experts wrote.
Asked by Reuters about the report, Congo’s mines minister, Willy Kitobo Samsoni, said he could not immediately share his figures on mineral smuggling from the east of the country.
The UN experts also found that Uganda and other neighbouring countries export far more gold than they produce, suggesting they might still be staging posts for smuggled Congolese gold.
More than 95% of gold exports from Uganda in 2019, which totaled just over 25 tonnes, were not of Ugandan origin, the group estimated, based on 2018 production and 2019 export data.
Uganda’s gold exports more than doubled in 2019 compared with the previous year, central bank data showed in March.
Uganda’s energy minister did not immediately respond to a request for comment on the report.
Smugglers told the Group of Experts that Kampala was a main trading hub for gold from Ituri. Smuggled gold from South Kivu went to Burundi, Rwanda, the United Arab Emirates, and Tanzania, the report added.
Zimbabwe’s governing party, Zanu-PF, has summoned finance minister Mthuli Ncube and Reserve Bank of Zimbabwe governor John Mangudya to explain the country’s economic meltdown, the Zimbabwe Independent reported.
Members of the party’s most-senior decision-making body are concerned that the economy’s collapse — marked by inflation of 766% and a currency collapse — threaten the party’s popularity and could cost it the 2023 elections, the Harare-based newspaper reported.
The two officials told the party’s leaders at a closed-door session of the politburo that there is little they can do unless the government comes up with an economic-recovery strategy, the newspaper said. Patrick Chinamasa, Zanu-PF’s secretary for finance and acting spokesman for the party, wasn’t immediately able to comment on the Zimbabwe Independent story when contacted on Friday.
President Emmerson Mnangagwa has blamed the economy’s woes on the private sector. He told the same meeting of the politburo that the country’s currency, reintroduced last year, was under attack, Zimbabwe Independent said.
The Zimbabwe dollar is trading at 90 per US dollar on the black market, according to marketwatch.co.zw, nearly four times above the official peg of 25.