The log that was blocking the highway to Zimbabwe Inc. has been removed, but we must not overlook what we already know, that not all fallen trees die with a fall.
By Gloria Ndoro-Mkombachoto
Often, when a tree falls, its root system, the life-blood, the animus, remains intact.
What was removed was a figurehead of a once-upon-a-time beautiful system that absconded and went rogue. While we were all focused on our helplessness and hopelessness in removing that log that was strewn across all of the Zimbabwe Inc. lanes, the root system bred seedlings that propagated multiple stray shoots and together they mushroomed, with a single focus: to plunder and pillage.
That system is still alive and well. Many, with mercenaric tendencies and who thrived and got enriched in this decay and debauchery, have shamelessly switched allegiances and are already parroting loyalty to the new order. It is awful to watch. His Excellency, the President Emmerson Mnangagwa and his team in the presidency have hit the ground running and if pronouncements of the past week around amnesty on externalised funds is anything to go by about what the future holds, then the shelf life of these economic bandits within our midst is limited.
As the transformation and rebuilding of Zimbabwe Inc. now well underway gains momentum, the key drivers of Zimbabwe Inc. must prioritise the rooting out of stony-hearted and apathetic bandits who wilfully allowed a lackadaisical social order to prevail in the old order.
Last week we discussed point three of the five important things happening in Zimbabwe today. This week we finalise the series by discussing parastatals in point four and industrial policy and/or ICT revolution in point five . l State-owned enterprises (SOEs)/parastatals — a black hole that needs to be plugged. For the longest time, Zimbabwe Inc. has had continually loss-making state-owned enterprises, a black hole on the fiscus. There are 107 SOEs in Zimbabwe Inc. Of these, only 40%, 43 to be precise, are considered wholly commercial entities. In their totality, the SOEs generate about 14% of gross domestic product (GDP) with commercial SOEs (40%) contributing 7,5%. Before the decline of Zimbabwe Inc., SOEs which were much fewer than 107, contributed about 40% of GDP.
Not so long ago, the editor of a sister weekly newspaper to this one, the Zimbabwe Independent, highlighted in a commentary dated June 23 2017, based on the auditor-general (AG) and the World Bank reports, that the looting of SOEs “had reached epic proportions and now posed a clear and present danger to national survival.”
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The new order has already announced that they are going to reduce the number of ministries as a way to increase accountability, efficiency and effectiveness within government. In addition to cutting down the number of ministries and of course SOEs in Zimbabwe Inc., CEOs of SOEs who have served for more than seven years must be retired with immediate effect but not before clean forensic audits for each and every SOE are tabled before parliament. Hopefully this time, parliament will take these reports and that of the AG seriously and insist on accountability.
The board of directors (BOD) must be relieved of their duties and new BODs appointed. Progress in the new dispensation will be compromised if the same level of thinking that prevailed within the last order is allowed to continue. Evidence of looting supported by detailed AGs audits are available that board appointments to SOEs were money making gimmicks particularly for the line ministers, their deputies and some members of the boards.
But even in the absence of current forensic audits, reports by the AG and World Bank referred to above, shed enough light into the goings on within SOEs as the Independent commentary further revealed that, “…the rampant financial malfeasance in parastatals is evidence of government’s tragic failure to manage public funds. Hundreds of millions of dollars are looted with impunity. Virtually every SOE is tainted.” We now await decisive action from the drivers of Zimbabwe Inc. regarding this matter.
l Industrial policy and/or ICT revolution — A national dialogue is long overdue Zimbabwe Inc. needs to have a national dialogue on the economic vision we aspire for. We know the mud from which we are emerging from and right now it would be unfortunate if the dialogue around whether we should be industrial policy focused and/or ICT revolution focused is left to the so-called experts alone. What I am saying is, economists by themselves, with all their badges of accomplishment, do not always get it right. They might also not necessarily see the trends.
While we were busy using development planning as a crisis management tool to deal with pressing issues like civil servants salaries, we did this at the expense of long-term visioning. Meanwhile, the visionary nations of the world have been shifting fast towards ICT mastery. That is why today, we are witnessing countries that do not possess abundant resource endowment having become extremely successful merely through ICT transformation.
The time was yesterday to have a national dialogue on the strategic agenda for Zimbabwe Inc. We need to clarify to ourselves where we want to be, how we are going to get there, what skills and resources are needed to achieve our goals and what we need to do now to maintain that momentum in the future. No one skill set has the monopoly on great and innovative ideas, hence the need for the process to be inclusive of all key stakeholders, within all sectors across the country.
The economy of Zimbabwe Inc. is as important as its supreme law, the Constitution of Zimbabwe. If the nation is consulted and inputs on the drafting of the Constitution, I believe the same process is necessary for a robust industrial policy and/or ICT revolution for Zimbabwe Inc., a grand policy that will get us back on the path to production and international competitiveness in niche areas where we have known distinctive competencies. Where competencies are low, we must plan now to have them as a prerequisite for achieving the future we want for ourselves.
When you glean at past indicators, industrial performance for Zimbabwe Inc. has been dismal to say the least. According to the Confederation of Zimbabwe Industries (CZI) reports, capacity utilisation in Zimbabwe Inc’s manufacturing sector has been declining from 73% in 1998, 60% in 2004, 44% in 2012, 36,1% in 2014, 34,3% in 2015, 47,4% in 2016 to 45,1% in 2017. Industry practitioners remarked that the increase from 34,3% in 2015 to 47,4% in 2016 was “largely due to distortions stemming from the closure of hundreds of companies that are no longer considered in a nationwide survey.”
Despite that distortion, industry remained subdued due to a whole host of reasons including but not restricted to the following, “corruption, policy instability, lack of access to cheap finance, inconsistent government policies as well as policy uncertainty, unclear property rights, country risk perception, power shortages, high cost of doing business, low domestic demand, high import volumes, inefficient services delivery from government owned business entities, competition from imports and low demand for domestic products.” If we continue at this rate, we are going nowhere slowly. We need a revolution of ideas now if we are even going to think about being internationally competitive in any sector.
As we plan the reclamation of our status as the powerhouse of Africa, intended to leapfrog Zimbabwe Inc. from predominantly a primary commodity producer into a vibrant exporter of processed goods into regions abroad and beyond, in addition to embarking on the ICT revolution now, we consciously must tap into the vast knowledge, experience and intellectual property of Zimbabwe Inc’s diaspora human capital. It will reduce the burden on the fiscus of hiring the so-called knowledgeable foreign consultants whose intentions, usually of a cut-and-paste nature, have never quite served our needs in the past.
Gloria Ndoro-Mkombachoto is an entrepreneur and a regional enterprise development consultant. Her experience spans a period of over 25 years. She can be contacted at [email protected]
