PRETORIA – THURSDAY, 4TH NOVEMBER, 2016 – GOVERNMENT has refuted accusations that it has been inconsistent with its economic policies saying all adjustments made previously were necessary as they were meant to protect the interests of Zambians.
Minister of National Development Planning, Mr. Lucky Mulusa has said that there has been cases of insincerity on the part of some investors and that Government has had to respond accordingly in order to safe guard the nation.
“All the adjustments to policy should be seen as a way of trying to align things for the benefit of the people. These policy adjustments in the past were in response to the insincere conduct of some members of the business community. There is no way we can just wake up today and introduce a new law which we again change a few weeks down the line. All our actions are informed by how businesses in the country behave,” Mr. Mulusa said.
He gave an example of businesses which either closed shop or simply changed names when their tax holidays and other incentives were coming to an end so that they could avoid paying tax or being subjected to other measures.
“It is these same businesses that go out on a crusade to speak ill about Government and sponsor various individuals to attack us when they see that their evil plans have been curbed. Before we condemn government about what we see as policy inconsistencies, we need to ask what informed Government to take such action.”
Mr. Mulusa was speaking as guest of honour yesterday at the ‘Invest in Zambia Business Forum’ organised by the Zambian High Commission in Pretoria in conjunction with the Zambia-South Africa Business Council (ZSABC). The well attended event held at Sandton Convention Centre in Johannesburg was sponsored by Liberty.
The Minister said Zambia was realigning it economy and noted that the country was ready for business but “it should be clear to all those interested that we are not, at the same time, open to abuse.”
He bemoaned the collapse of Zambia’s industrial base built over 27 years which he attributed to the privatisation exercise through which he said some unscrupulous investors came and stripped companies of their machinery and left them as warehouses to store imports from South Africa and elsewhere.
“I acknowledged the important role that South Africa plays as Zambia’s largest trade and investment partner, and at the same time, lament that for over 10 years, Zambia has only been able to capture less than 10% of total trade volumes between the two countries. What we have seen over the years is that this has not worked for us as some investors only rip, and do not plough back into the economy. What we are looking for are sustainable partnerships, and not relationships that leave our country worse off,” the Minister said.
He urged the ZSABC to promote Government’s agenda of fostering inclusive business models that ensured integrating local communities in the supply chains and support the growth of local industries in all sectors of the economy.
Mr. Mulusa urged South African investors to quickly get into Zambia before they lost opportunities to other countries such as China which were in a hurry to do business with Zambia.
He also appealed to investors entering Zambia not to engage in activities, such as casualisation and others, which exploited the country and its people.
He said Government has realised that it was more expensive to produce a particular product in Zambia as compared to other countries pointing out that this, and other issues that would help bring about a conducive environment for business, were being addressed.
“Our Government is keen at enhancing private sector led growth and has been working hard to create an enabling environment for business, as evidenced by the enactment of the Business Regulatory Act of 2014 that was meant to create a cost effective and business regulation framework in Zambia. As a result of our business environment reforms, Zambia is now ranked 8th in SADC and 4th in COMESA in terms of the Ease of Doing Business. Furthermore, Zambia is ranked the 8th most competitive country in Africa on the Global Competitiveness Index,” Mr. Mulusa said.
He said despite all the favourable business elements that Zambia had in place, the country had taken long to develop because of the poor policies which it previously pursued while other policies had been mishandled.
Zambia’s High Commissioner to South Africa, His Excellency Mr. Emmanuel Mwamba concurred with the Minister on the issue of privatisation saying the exercise failed to yield the targeted results because most of those who bought off companies were only interested in satisfying their selfish desires.
Mr. Mwamba said the High Commission devised the ZSABC as a platform from which to engage captains of industry so that amicable solutions for the two countries could be found.
He also pointed out that there was trade imbalance between Zambia and South Africa which favoured the latter. “There is no way that South African stores operating in Zambia should continue importing into Zambia, products that are readily available in the country.”
And South Africa has said that Zambia was a strategic market and partner for South Africa, and vice versa, because of the potential for enhanced economic cooperation that existed between the two countries.
Chief Executive Officer for Trade Invest Africa, an initiative of South Africa’s Department of Trade and Industry, Ms. Lerato Mataboge, has noted that total trade between the two countries has been showing positive growth from R19.9 billion in 2011 to R31.9 billion in 2015, making South Africa Zambia’s main trading partner in the SADC and Zambia, South Africa’s fourth largest trading partner in the region.
Ms. Mataboge said South Africa was conscious of the trade imbalance which supported her country and that this needed to be assessed and addressed. “Key to this will be identifying and establishing cooperative mechanisms for assisting Zambian businesses seeking opportunities to supply in the South African market. Our aim as a government is to increase the levels of South African investments in the Zambian economy and the rest of the Continent through targeted support measures.”
Two such measures are the recent creation of Trade Invest Africa as well as the unveiling of the Guidelines to Good Business Practice for Doing Business in Africa, both of which were launched in July this year.
Trade Invest Africa supports South African businesses looking to invest in the rest of Africa as well as those looking for export opportunities on the continent.
She said Trade Invest Africa will work with partner countries to facilitate sourcing of goods from the rest of the continent into the South African economy as a way of contributing to increasing the levels of intra-Africa trade and intra-African investments.
Ms. Mataboge pointed out that Zambia today was one of the promising emerging markets in the world and “I strongly urge the South African business community to take advantage of the advanced economic and diplomatic relations and seriously consider investing in Zambia. We commend the Zambian government for ensuring that the conditions for foreign investments are continuously being improved upon.”
ZSABC chairperson, Mr. Charles Kalima urged businesses to join the Council so that they could be assisted with establishing themselves on the Zambian market.
Mr. Kalima said there was need to develop an African concept where countries on the continent traded among themselves in order to foster development.
South African Chamber of Commerce and Industry (SACCI) Chief Executive Officer Mr. Alan Mukoki said Africa should realise that agriculture, and not activities such as mining, was the major contributor to economic growth.
And during a panel discussion, Barclays Africa Region Chief Executive Officer, Ms. Mizinga Melu said Barclays Bank has been in Zambia for over 100 years because it had found Zambia to be good for business. Ms. Melu said Zambia had 19 reputable commercial banks operating in the country because they have found the environment conducive.
She said the freedom for investors to externalise profits was a big incentive that Zambia’s potential investors should seriously consider.
Massmart Holdings Chairperson, Mr. Kuseni Dlamini said Game Stores and the recently opened Builders Warehouse, which are subsidiaries, have performed exceptionally well because of the favourable business environment in Zambia.
Zambia Energy Forum Chairperson, Mr. Johnstone Chikwanda told the audience that with the energy deficit in Zambia, the country had a lot of opportunities for producing energy from various sources that the Government had identified.
Others who spoke on various panels were Ms. Zandile Shabalala, ZSABC Vice-chairperson; Mr. Michael Njapau, Head of Business Development for Liberty Life Insurance Zambia Limited; Mr. Brenden Alexander, Head of Business Development Support for STANLIB; Mr. Mduduzi Nene, Africa Divisional Director for Liberty Health; Mr. Kennett Sinclair, Partner from Exeo Capital; Mr. Ewout Van der Molen, FMO Southern African Regional Representative, and Mr. Ashley Petersen, Senior Business Development Manager from South Africa’s Industrial Development Corporation.
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