The Sunday Mail
Ministry of Truth with Cde Jason Zhuwao
The average Zimbabwean will remember March 2008 as the commencement of the struggle for economic empowerment when President Robert Mugabe put into law the Indigenisation and Economic Empowerment Bill.
However, the pundits recount that the subject of indigenisation dates back to the period from the 1960s to the 1980s.
It is then that a post-colonial Africa against a background characterised by lack of expertise, capital shortage, technological limitations and a paucity of skilled manpower began the conversation on indigenisation.
Each country has experienced varying impediments to this cause in relation to the severity of the constraints it faces. Arguably the greatest hindrance to the economic progression of most African countries, Zimbabwe included, has been the ill adjustments of mindsets to comprehend the meaning of economic emancipation.
Of all the arguments I have heard against the Zimbabwean empowerment policy, the most perturbing have been those that make our Government’s stance on promotion of equal wealth distribution, a unique and first such policy in the world.
Yet, any decent state would abhor a state of affairs where a disproportionate section of the population are the major beneficiaries of aggregate economic activities, especially if they are non-citizens.
To these ill-advised critics, I introduce Africa’s largest economy, Nigeria, and reveal that the successes of this regional powerhouse are as a result of its indigenisation laws.
It was only Nigeria which during the time of its first leader after independence began to draft state policies that officially nurtured indigenous capitalists. So in comparison, Zimbabwe lags behind by over 40 years in the full implementation of indigenisation laws, yet you find certain people trying to delay these laws even further when we should be expediting the process to catch up with economies such as Nigeria.
Nigeria began with a policy of “passivity” which saw major areas of the economy being reserved for private enterprise in order to encourage Nigerian businessmen.
By 1972, Nigeria launched its first indigenisation Decree permitting foreign investors 40 percent equity shares.
This move did not deter investors as has been argued by some Zimbabwean businessman.
Instead, British Leyland eagerly invested in Nigeria in 1982, aware of the returns that would come from doing business in the country.
In a similar manner, foreign companies that have invested in Zimbabwe over the years cannot deny that they have made substantial profits and would continue to do so even under the prescriptions of the empowerment framework.
The next key step in the building of an indigenous economy in the West African state was the identification of its main capital sources according to its resources. Of course, oil stood out as the main financier of national projects.
Back home, President Mugabe constantly calls for a robust shift from viewing agriculture as a sustenance practice to the transformation of this sector into a viable means of income, particularly from exports of value added agricultural products.
This paradigm shift extends to mining where Government has become diligent in ensuring that beneficiation is practiced across all exported minerals.
In Tanzania, the then leader President Nyerere was quoted saying “under existing conditions, ‘periphery capitalism’ simply cannot result in an indigenised, self-reliant economy: only Tanzanians are sufficiently interested to develop Tanzania in the interest of Tanzanians…”
What the great man alluded to was the fact that the development of a country is brought about by people, not by money.
Nigeria has had a different approach with its local empowerment resting on the government’s financial resources. The result has been a growing elitist class.
I believe a combination of the two strategies will better suit Zimbabwe where we recognise, as has been done in ZimAsset, our human population as our greatest resource and then supply a determined populace with the resources it requires to build sustainable enterprise. In my opinion, this will result in a more equitable distribution of wealth in the long run.
Nigeria successfully implemented a 60:40 ratio with enterprises required to have 60 percent indigenous participation. This is much higher than the 51:49 sharing asked for by our Government. Throughout the years, the Nigerian government has increased its assistance to indigenous capital but has also welcomed foreign capital, FDI.
The important thing to note is that Nigeria only permitted FDI in strategic sectors where it felt a lack of foreign investment would strain its coiffures.
That being said, there is no need to call for FDI in sectors where indigenous Zimbabweans are well able to develop relatively easily.
The excuse for non-compliance with our indigenisation laws has been that the framework is ‘too complicated’, but good policy is always complicated.
The Keep it Simple, Stupid (KISS) adage may work well for engineering management but sometimes matters can be made too simple, particularly where economics and politics intersect.
What we should request from Minister Zhuwao (Youth, Indigenisation and Economic Empowerment) is not necessarily a simplification of the policy but simplified presentations of the policy to the general populace.
The Minister can make use of his Youth Desk officials to develop innovative models that explain this stigmatised policy to both locals and foreigners alike.
The fact is we have a solid document at hand whose success or failure is dependent on how we sell it.
Just like the greater economies have found the importance of a balance of soft and hard power in their political strategy, a similar approach is necessary when selling the Brand Zimbabwe product.
For Nigeria, Indigenisation rose from a strong desire to facilitate the development of an economy that would eventually come under the control of Nigerians. This is the same aspiration our President has for Zimbabweans.
If this mental disposition of the Nigerian governments over the past decades are what have resulted in this nation being the leading economy in Africa, why are we so hesitant to implement similar policy?
Great economic success awaits Zimbabwe if the Government plays its rightful role in industrialisation whilst ensuring the correct harmonisation and balance of domestic and foreign capital. The underlying focus of all our economic efforts must be development of domestic entrepreneurs with an ultimate aim of promoting private indigenous capital.
Cde Jason Zhuwao is district chair of the Zanu-PF Harare Central Youth League and CEO of the Team Zanu-PF Live, the party organ for mass dissemination of information, research, mobilisation, networking, live updating of current affairs and e-media campaigning.
