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Benefits of Making Business in Zambia | Buy & Sell Business

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Benefits of Making Business in Zambia | Buy & Sell Business

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  1. BENEFITS OF MAKING BUSINESS IN ZAMBIA WWW.MERGERSCORP.COM

  2. At MergersCorp M&A International we help our clients confidentially buy and sell privately held businesses, aligning the interests of all parties for mutual success and satisfaction. It is our goal to make the process of either buying a new business or selling your current business as smooth and efficient as possible. We know how important confidentiality is to our sellers and we treat it with the utmost importance. WWW.MERGERSCORP.COM

  3. BENEFITS OF MAKING BUSINESS IN ZAMBIA WWW.MERGERSCORP.COM

  4. Country Overview Zambia, in southern Africa, is a landlocked country of rugged terrain and diverse wildlife, with many parks and safari areas. On its border with Zimbabwe is famed Victoria Falls indigenously called Mosi-oa-Tunya, or "Smoke That Thunders” plunging a misty 108m into narrow Batoka Gorge. Spanning the Zambezi River just below the falls is Victoria Falls Bridge, a spectacular viewpoint. Zambia is predominantly a Christian country, although few have totally abandoned all aspects of traditional belief systems. The first Christian missions arrived before colonial rule, and the growth of adherents was greatly assisted by the schools that they established. More than three-fourths of Zambians identify as Protestant, while Roman Catholics make up one-fifth of the population. The Asian community is predominantly Hindu, the rest mainly Muslim. There are relatively few Muslims among the African population. Central government is represented throughout Zambia by the provincial government system, by which resident ministers each of whom is the president’s direct representative are appointed by the president to each of the provinces.

  5. Executive Summary Lusaka became the capital of the newly independent Zambia. Zambia lies in a central position in southern Africa surrounded by quite a number of countries. It is a landlocked country between Angola in the west, Namibia, Botswana and Zimbabwe in the south, Mozambique, Malawi and Tanzania in the east, and the Democratic Republic of Congo in the north. A virtual guide to Zambia, officially the Republic of Zambia, a landlocked country in central south Africa, separated from Zimbabwe by the Zambezi River. Zambia is also bordered by Angola, Botswana, the Democratic Republic of the Congo, Malawi, Mozambique, Namibia, and Tanzania. Zambia has a population of 15.9 million people. Capital and largest city is Lusaka. Spoken languages are English and several Bantu languages, major dialects are Bemba (ChiBemba) 33%, Nyanja (Cinyanja) 15%, Tonga (Chitonga) 11% and Lozi 5.5%. Traditional art includes the finest of basketry, pottery and unique carvings. Craftwork is very popular in Zambia. Using materials such as bamboo, grass and papyrus palm leaves, furniture pieces and different types of baskets are created. English is the official language, but there are 73 spoken languages. It's one of best places to spot lion and leopard.

  6. Introduction – Doing business in Zambia The country’s economy has historically been based on the Copper Mining Industry. However, the Zambian Government is undertaking economic diversification to reduce the country’s reliance on the Copper Industry and exploit other components of Zambia’s rich resource base by promoting Agriculture, Tourism, Gemstone Mining and Hydro Power generation. Zambia’s macroeconomic objectives include accelerating the diversification of the economy, particularly towards tourism, energy, agriculture and agro- processing as well as creating employment opportunities through accelerated implementation of programmers such as the Industrialization and Job Creation Strategy and the Youth Empowerment Action Plan. Growth is projected to strengthen to above 4%in 2018 and over the medium-term. High international copper prices and improved domestic production from newer and recently refurbished mines is expected to support exports. High copper prices have eased external pressures, leading to a stable kwacha.

  7. Conducting business in Zambia Zambia is blessed with large mineral deposits which have significantly helped economic development. Thanks to high copper prices in the mid 20th century Zambia became one of Africa’s richest countries but was hit hard when prices dropped from the 1970s onward. Twenty years later its foreign debts were among the highest in the world. To counter this downfall the government began reforming its economy in the early 1990s. Recent trade liberalization, privatization and budgetary changes. Greetings are very important in Zambian business culture and the most senior attendant should always be greeted first. Address people by their surname and with their full title unless the person asks you to be more informal. Zambians dress business casual and usually only wear suits to formal events. A lack of attention to how you are dressed is perceived as laziness and considered rude. Smart trousers and a shirt or blouse are considered appropriate. Women also tend to wear long skirts. Be careful not to expose your knees or shoulders.

  8. Taxation in Zambia Corporation tax is Residents are taxed on domestic source of income and certain types of foreign income, non-residents are normally taxed on Zambian source of income. Residents are taxed on domestic source of income and certain types of foreign income, non-residents are normally taxed on Zambian source of income. Zambia has the following direct taxes: Company Income Tax, Personal Income Tax, Withholding Tax, Presumptive Tax and Property Transfer Tax. Income Tax Rate in Zambia is expected to be 37.50 percent by the end of this quarter, according to Trading Economics global macro models and analysts expectations. In the long-term, the Zambia Personal Income Tax Rate is projected to trend around 38.00 percent in 2020, according to our econometric models. The VAT rate is 16% and is applicable to supplies of standard-rated goods and services. The export of goods from Zambia is zero-rated. .

  9. Trade Zambia is the 83rd largest export economy in the world and the 78th most complex economy according to the Economic Complexity Index (ECI). In 2017, Zambia exported $9.7B and imported $8.5B, resulting in a positive trade balance of $1.21B. In 2017 the GDP of Zambia was $25.9B and its GDP per capita was $4.02k. The top exports of Zambia are Raw Copper($4.59B), Refined Copper ($2.64B), Cobalt($233M), Raw Tobacco ($189M) and Postage Stamps ($144M), using the 1992 revision of the HS (Harmonized System) classification. Its top imports are Copper Ore ($820M), Cobalt Oxides and Hydroxides ($712M), Refined Petroleum($649M), Crude Petroleum ($389M) and Nitrogenous Fertilizers ($228M). The top export destinations of Zambia are Switzerland ($3.64B), China ($1.45B), India($924M), South Africa ($711M) and the Democratic Republic of the Congo ($497M). The top import origins are South Africa ($2.61B), the Democratic Republic of the Congo ($1.78B), China ($1.18B), Kuwait ($423M) and the United Arab Emirates ($313M).

  10. Banking in Zambia Zambia National Commercial Bank (Zanaco) In terms of assets, Zambia National Commercial Bank (Zanaco) is the largest financial services provider in Zambia. Founded in 1969, the bank serves more than one million customers in the personal, government, corporate, SME, and agriculture sectors. It currently employs 1,228 individuals, making it the biggest employer of all banks in Zambia. Standard Chartered Bank Zambia Standard Chartered Bank Zambia opened its first branch in Zambia in 1906. The bank offers a wide range of banking products and services to upscale retail customers, SMEs, and large corporate clients in the country. With more than 700 employees, it operates a network of 25 outlets and 47 ATMs located in six of Zambia’s 10 provinces. Stanbic Bank (Zambia) Founded in 1956, Stanbic Bank (Zambia) is a member of the Standard Bank Group, which is present in 20 African countries. The bank offers a comprehensive range of consumer, corporate, business, and investment banking services in the country. Headquartered in Lusaka, it currently manages 13 branches.

  11. Our M&A Process NEGOTIATION & CLOSE POST MERGER INTEGRATION (PMI) INTEGRATION (PMI) POST MERGER TARGET APPRAISAL APPROACH DUE DILIGENCE Key Areas  Target & market analysis;  Initial assessment of synergies & value drivers;  Indicative valuation;  Go or No-Go decision;  Preparation of transaction documents (NDA – Non- disclosure Agreement/LOI- Letter of Intent);  Select Transaction team;  Appoint advisors;  Consider funding ability.  Initial approach letter;  Signing of NDA;  Prepare & share initial information requests;  Formulation of LOI (Letter of Intent) & possible negotiations;  Initial meeting and Q&A;  Circulate information on the Target to the Transaction team.  Set scope of due diligence;  Set up VDR (virtual data room);  Coordinating of due diligence, further meetings and Q&A sessions;  Consider points relevant to the Post-Merger (PMI) phase;  Revisit indicative valuation & prepare detailed valuation based on due diligence findings;  SPA negotiations with the seller;  Development of final structure (share/asset deal) and final valuation;  Approvals;  Signing of SPA & Close.  Consider the extent of integration;  Development of 100 Day PMI Plan;  Consider short & long term objectives;  Estimate requirements to capture synergies;  Determine resource needs & optimal allocation. Parties Involved  CFO;  Head of M&A;  Accountants;  Corporate finance advisors;  Consultants.  Senior management;  CEO, CFO, CTO;  Strategy director;  Head of M&A;  Head of Business Development;  Consultants.  Company general counsel;  Lawyers;  Senior management.  Company general counsel;  Lawyers;  Senior management/HR. 11 © Midaxo 2018 www.midaxo.com

  12. Looking to Buy or Sell a Business? CONTACT US NOW FOR A FREE BUSINESS VALUATION WWW.MERGERSCORP.COM

  13. MergersCorp.com The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation. Member firms of the MergersCorp network of independent firms are affiliated with MergersCorp International. MergersCorp International provides no client services. No member firm has any authority to obligate or bind MergersCorp International or any other member firm vis-à-vis third parties, nor does MergersCorp International have any such authority to obligate or bind any member firm. Copyright © 2020 MergersCorp International. All rights reserved. 13 © Midaxo 2018 www.midaxo.com

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