Private sector can go an extra mile

12 Mar, 2023 - 00:03 0 Views
Private sector can go an extra mile

The Sunday Mail

Editor’s Brief
Victoria Ruzvidzo

INFONIC training advises that the private sector is driven by competition and the profit motive. This then entails better utilisation of resources and higher productivity.

Evidently, the private sector has a critical role to play in our developmental aspirations and economic growth designs. Business has always been one of the constituent elements of any economy. The others being government and labour.

Statista notes that agriculture contributed 8.85 percent, manufacturing 28,8 percent and the service industry 56.64 percent to gross domestic product (GDP) in 2021.

These statistics amplify the critical role the private sector plays. In the same vein, we need to interrogate if private sector involvement in the Zimbabwean economy can be escalated.

Looking at one of the strongest economies on the continent – South Africa – its private sector employs 75 percent of the total workforce and accounts for more than 60 percent of investment, research and development expenditure. Its key sectors include mining, transport, energy, manufacturing and agriculture.

Again, this underlines the key role the private sector plays and the potential for more is huge.

There is always a compelling need to work hand in glove with other economic players. It would be foolhardy for any sector to go it alone. There is need for congruency and alignment amongst them.

While governments the world over are significant players in any economy, the private sector must, of necessity, play its role in complementing government efforts.

Has the private sector in Zimbabwe done all it can as we seek to consolidate the economic growth trajectory? What are the low-hanging fruits? How can it contribute more? For, indeed, everything is work in progress and there is need for perpetual learning and growth.

In this vein we commend the hosting of the inaugural ED Mnangagwa Summit convened by the Confederation of Zimbabwe Retailerss in Harare on Friday. This is as it should be.

President Mnangagwa commended the private sector for filling supermarket shelves with local produce.

He challenged them to take advantage ofcthe many opportunities created by the Second Republic.

“My Government will continue engaging you our stakeholders, in nurturing an investor-friendly environment to spur economic growth . . . On your part as business
I challenge you to collaborate with our institutions of higher and tertiary education to ensure that the various patents,products and prototypes that they are producing end up on your shelves,”  said President Mnangagwa.

Indeed Nyika Inovakwa neVene vayo.

Such interactions between Government and business will yield much for the economy.

We have a plethora of business member organisations such as the Zimbabwe National Chamber of Commerce (ZNCC), the Confederation of Zimbabwe lndustries (CZI) and the Retailers Association of Zimbabwe.

We have others focused on entrepreneurs such as the SME Association of Zimbabwe and the Zimbabwe Entrepreneurs Network. This, indeed, advances the respective causes.

The question that begs an answer is whether they are doing enough. Put differently, how can efforts be improved or greater traction attained?

There might be challenges peculiar to certain sectors but in the end, the question might be the progress that has been made in obviating challenges.

One of the issues raised is that the private sector contributes to inflationary pressures. That their cost structure and pricing models are skewed. Indeed, that it is mainly concerned with profiteering, leaving customers reeling.

Fluctuations in foreign currency exchange rates do not correspond with price increases, as in most instances, customers are having to pay a lot more for goods and services, not justifiable by changes in rates.

Private players are accused of taking advantage of situations, arbitrarily increasing prices whose magnitude may be scandalous.

But this is akin to cutting the nose to spite the face. In any business, customers are key. We have transitioned from customer service to customer experience yet we have some entities that simply do not give a hoot about the very customers for which their entities were formed.

The chickens will come home to roost for such players. It might work for a while but it is clearly unsustainable for them. Customers, on the whole, do not have short memories.

They will distinctly remember who made them suffer and who stood by them.

A few weeks ago, Finance and Economic Development Secretary Mr George Guvamatanga lamented the practice by business, where they peg prices at parallel market rates yet this market accounts for only 10 percent of transactions.

The bulk is happening on the formal market, where rates are much lower. The latter is what should guide pricing mechanisms.

The Government has put in valiant efforts to incorporate the private sector. The Presidential Advisory Council (PAC)is essentially made up of private sector representatives. This is ringing testament of the Government’s stance to include business in policy formulation.

There are also wide consultations in budgetary processes to ensure concerns or issues by the private sector are considered. Without question, the private sector has much to contribute.

There have also been accusations of unfair labour practices and treatment, where some private players do not commensurately reward their employees despite increasing revenues. This goes to motivation and performance, which are adversely affected by such conduct.

Infrastructure development, rehabilitation and improvement are also a case in point. It is clear and evident that the Government has done much.

We have seen numerous roads being built, bridges, too, in areas that were previously condemned. We have seen airports being revamped and much more. These are laudable efforts by Government.

Whatever political persuasion, these cannot be denied. We should be mindful that the Government has competing and simultaneous demands on its fiscus. An infinite number of issues are on its plate.

This is when the private sector comes to the party through the Build, Own, Operate concept, among other schemes.

We have not seen much contribution by this sector. Of course, some work is being done but the country needs much more done. Ironically, it is the sector that also benefits the most.

It cannot be left to Government to do it alone. It simply cannot, even if it desired to.

Illicit financial flows raise numerous issues. When we have a sector delving in offshore accounts, fraud, under-invoicing and outright smuggling, then we have serious challenges. We have others, too, that have specialised in tax-avoidance. This negates our goals in a clear and incontestable manner.

Yet we have some amongst the populace who vehemently point accusing fingers at Government for a lack of one thing or another. Look at your doorstep first before you look at another’s. At times, our conduct is manifestly self-destructive. Those that practise such need to desist so we can make more progress.

It is as if some are just fixated on selfish interests, blatantly breaking the law in the process. And again, they still look up to Government to be the sole solution provider and yet some of these traits deny it the means to do so.

There has been some progress made in areas which we note and applaud. Capacity utilisation has increased substantially to around 66 percent. We have also noted growth in a number of entities. These have had a significant impact on the economy. We duly acknowledge it.

Exports receipts have grown phenomenally to more than US$11 billion. This is no small feat. The economy’s health is now much better resultantly.

But again, we need to look at areas of improvement. Where can we do more? What acts of commission or omission need to be discarded?

Every economic player has a role to play in fashioning the country we desire. The private sector and everyone, for that matter, needs to conduct themselves ethically, responsibly and prudently.

We cannot ignore how much the private sector can do for this country and its populace. That is a given. But we also concurrently look at ways and avenues that its role can be augmented.

So, then, it is that we have Government, business and labour, all of which are critical elements in an economy. Each one must play its part. The private sector should take the initiative and become more driven. The benefits therefrom are mutual. It becomes a win-win situation.

The economy has to score high points on many fronts and it can achieve much more if the private sector applies itself more. Ideally, Government plays a facilitative role and the private sector gets down to business. Vision 2030 is not a mirage or a far-fetched dream. It is possible. It just requires all hands on deck.

In God I Trust!

 

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