3 August 2012

Zimbabwe: Support Local Procurement

Photo: IRIN


The fact that the Chamber of Mines Joint Suppliers and Procurement Sub-committee workshop on the sidelines of the recent Mine Entra emphasised the importance of forging strong relationships between local industry and the mining sector is a major outcome in itself.

The sub-committee has become the local champions of local procurement and should be hailed for that. Clearly, this is why mining has been viewed as a key pillar of Zimbabwe's economic growth not only because the economy anticipates major revenue collections from the mining sector but also because the men and women in the sector have the right mindset for economic development.

The Chamber of Mines has seen opportunities where others are failing to see them. Following the example of the chamber, I believe that we should all change the way we see our opportunities, open our minds to developments on the local, regional and world stage and be creative and innovative in implementing strategies that will boost our economic development.

Leading academic Professor Mandi Rukuni calls it "software" and mindset change. The question is do we need legislation or just the will power for this to happen?

Quoting the chairperson of the committee, Mr Philemon Muchana, what we need is "collective effort to safeguard and protect local industry which is capable of producing the same quality equipment".

Earlier on I said we also need to be aware of what is happening around us in order for us to make informed decisions. Not only is it important for us to be proactive but to begin with the end in sight. What is the course of our actions right now?

Our neighbours, South Africa, are effectively closing out foreign suppliers from their markets with the Buy SA Accord signed sometime last year and their Preferential Procurement Policy which is a constitutional item. Now, our end in sight will ultimately be no Zimbabwean markets and no South African markets for our local products. Sadly, South Africa is our biggest trading partner.

Perhaps I should put the preferential procurement legislation in South Africa into perspective. According to a paper titled "An analysis of the Preferential Procurement Legislation in South Africa," by Phoebe Bolton who is a Professor at Law at Stellenbosch University in South Africa, "Section 217 of the South African constitution makes provision for the use of procurement as a policy tool.

"It allows organs of the state to make use of 'affirmative procurement', 'preferential procurement' or 'targeted procurement' during the award stage of the government procurement process."

The terms "affirmative," "preferential", and "targeted" have been used to bring the regulations more in line with the Broad-Based Black Economic Empowerment Act effectively meaning that without a BEE certificate it becomes difficult to register for a government tender. The paper goes further to say, "Affirmative Procurement is not an infringement to equality . . ."

A June 2010 report in the Business Day titled "MPs urge speed on protectionism" read: "MPs want the International Trade Administration Commission to work faster to implement protectionist tariffs to help vulnerable industries fend off decimation."

While we stay conversant of the cumulative cost of protectionism and the disadvantages of being selective and economically distortive on the economy, the reality is that the South African government supports some industries through trade protection and other forms of industrial policy.

This brings me back to the earlier question, do we need legislation to support our local businesses or do we need just the will- power embedded in our national pride and the realisation of the ultimate consequences of our action or inaction thereof. Food for thought. When we buy foreign, we effectively export our hard-earned US dollar. The country is operating a budget of US$3,4 billion because of a number of reasons and the export of the US dollar when we buy foreign is chief among.

A substantial amount of our incomes are either circulating in the informal market where foreign products are being sold in huge volume or when companies willfully export the US dollar when they purchase supplies which could otherwise be bought in the country. On a lighter note, after three weeks of intense theoretical and practical training and mentorship, the 2012 crop of My Own Boss contestants have been nurtured into the "champions" they aspire to be and are ready to take Buy Zimbabwe from the boardroom to the streets.

Tonight the 14 contestants that will be making it into the broadcast phase will be announced. Those who have been following this column and the My Own Boss column in H-Metro will know that the contestants have been interacting with some of the country's leading businesspeople during what we called the "Champions Nights".

Philip Chiyangwa (serial entrepreneur), Devine Ndhlukula (founder and managing director of Securico), Engineer Dawson Mareya (managing director, Willowvale Mazda Motor Industries), Nigel Chanakira (founder of Kingdom Bank) and Oswell Binha (president, Zimbabwe National Chamber of Commerce and Sadc Chamber of Commerce and Industry) are some of the big names that took out time from their busy schedules to mentor the crop of contestants in My Own Boss 2012 -- Buy Zimbabwe edition.

The show, which will be screened on ZBC TV, Africa Unite and DStv's local bouquet is set to captivate not only reality TV fanatics but most importantly scholars of the school of entrepreneurship with its cut-throat, innovative and sometimes energy-sapping tasks.

The reality show seeks to groom upcoming entrepreneurs who wish to build a legacy of wealth and job creation.

The writer is the Media and Communications Executive for Buy Zimbabwe Campaign.

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