COMMENT: Where are the new Jack Mallochs?

20 Mar, 2016 - 00:03 0 Views
COMMENT: Where are the new Jack Mallochs?

The Sunday Mail

There are three major economic issues Zimbabwe must grapple with.

The first is the drought, largely a natural occurrence of which our best action is mere mitigation. The other two are indigenisation and the attendant empowerment, and sanctions. These two require human agency to resolve.

Regardless of political views, the fact is that indigenisation is here to stay.

Some say its hard line implementation is not a matter for negotiation. Others say it scares away FDI and should be eschewed at all costs.

The reality is that we have to find a balance between indigenising the economy and empowering our people on the one hand, and attracting viable investment on the other.

Indigenisation and empowerment are in our national interest. So is attracting the right kind of investment.

It does not serve our national interest any good to leave the economy perpetually beholden to foreign capital. Again, it does not advance our national interest to advocate for the wholesale shutting down of non-compliant companies.

Let us recall the words of President Mugabe ahead of his 2013 birthday celebrations.

In an interview with ZBC, our Head of State and Government said: in part, “… theory yedu ndeyekuti resource iyoyo ndeyedu and that resource is our share – that is where the 51 percent comes from.”

In light of the President’s vision for indigenisation, we should be seized with how best to indigenise non-compliant companies instead of shutting them down.

Our policy should soar above simply shutting down and grabbing.

There should be a plan in place to ensure companies remain operational, perhaps under new indigenous ownership. There should also be a plan to make sure that they grow, in which event we can then empower people holistically via opening new related industries and services, and job creation. A structured empowerment drive will actually help us resolve the third major economic question of our time: which is sanctions. Once more, regardless of political views, the fact is sanctions are there and yes they are targeted — they target the entire economy. (Perhaps those with their heads buried in the sand might care to explain to us who is targeted by the sanctioning of Zimbabwe’s two largest fertiliser manufacturers, more so in an agro-based economy.)

Empowerment should be seized with creating new companies so that we grow our economy without remaining at the mercy of (a) foreign-owned companies that may be complicit in our sanctioning, and (b) existing entities whose business practices are irrevocably tied to Western capital such that they are easily sabotaged via sanctions.

It is not enough to merely indigenise existing companies. Real empowerment will come from creating new entities that create both entrepreneurs and jobs and provide a buffer against sanctions.

So, our policy makers should be spending sleepless nights coming up with models that support continued operation of firms that refuse to comply with indigenisation, and mechanisms to create new firms and industries that buttress the new economy we are trying to create.

Yes, the sanctions hurt. But we cannot wish them away. We must learn to survive them. And 15-plus years is enough time to learn how to contend with the biting reality. An interesting read in this regard is a paper titled “An Inquiry into how Rhodesia Managed to Survive under Economic Sanctions: Lessons for the Zimbabwe Government” by Trade And Development Studies Centre research fellow James Hurungo in January 2010.

He writes that interventions like import controls, evasion and finding new markets, price maintenance policy, import substitution and diversification, dualised cash/non-cash economy which forestalled inflation; steady wage levels, infrastructure development, and freezing payments to foreign creditors helped Ian Smith’s regime along.

To give the devil his due, the settler government found a way to survive and, as said by Hurungo, even saw trade with some countries expanding.

Southern Rhodesia solidified ties with sympathetic regimes like apartheid South Africa, Portugal, France, a pro-West Iran, Japan, and West Germany. For food security, some white tobacco farmers increased maize and beef production for the domestic market. The Rhodesian Air Force earned the name “The Sanctions Busters” because of its role in keeping the economy afloat.

There were men like Jack Malloch, a sanctions-buster extraordinaire who after serving as a World War II pilot, a one-time CIA agent and dog of war in a dozen African insurgencies moved to Umtali, now Mutare, and founded aircraft companies like Air Trans Africa and Rhodesian Air Services.

Malloch operated a craft under the name Afro Continental Airways for a weekly service from Salisbury to Windhoek, and he also obtained a fleet of aircraft with assistance from the Rhodesian government which he registered in Gabon.

He flew beef to Gabon, from where it was flown out by aircraft of its associate company Affretair, and essential materials for the Rhodesian security forces were brought into the country on the return flights.

We don’t like Malloch’s politics. But we must admire his commitment.

So, where are Zimbabwe’s Jack Mallochs?

CARTOON

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