Transfer of wealth: where to now?

Between 2004 and 2006 all but a few indigenous banks in Zimbabwe faced significant political problems. Their founders where hounded out of the country on spurious charges of externalizing foreign exchange. The financial services industry as a whole faced an inexplicable purge. The chief instigator of this entire disempowerment crusade was none other than Gideon Gono in his new role as the Governor of the Reserve Bank backed by his Excellency President Robert Mugabe.

Indigenous banks had indeed started a massive transfer of wealth to black Zimbabweans by funding industry and coming up with quite innovative ways of mobilizing capital and creating access to that capital for black owned and managed businesses.

As a result, a large number of black entrepreneurs began owning their own companies after having gained valuable experience in the corporate sector. The trigger to all this new business activity was the fact that blacks now had access to bankers who understood where they were coming from and genuinely wanted to assist. It was a win-win situation.

Black owned banks even started to surpass established foreign owned banks in terms of assets and deposits under management, including profitability. This of course all fell apart as Gono arrived at the central bank and in partnership with Zanu (PF) decimated the sector as it was seen as a political threat.

During that time, we witnessed an intelligent, rapid and apolitical transfer of wealth to black Zimbabweans and we did not need indigenisation laws. Indigenisation was happening – based on sound business principles where black owned companies had the necessary expertise and access to credit lines that resulted in significant economic growth.

This to me remains the most logical and less disruptive means of transferring wealth to black Zimbabweans. The problems only started when the politicians got involved and became jealous of the success of indigenous entrepreneurs as they amassed wealth without the need to gain favour from those in power.

The social behaviour of some of the new black capitalists did not help the situation as they splurged on cars, women and wine. As Zanu (PF) now seeks to transfer wealth, our fear is not that it is a bad thing to do – but that it will not be done properly by people who have the relevant expertise and experience.

In the transfer of wealth, there need not be any losers at all and it need not be confrontational as has been the case to date.

For example, why not establish a business council of industrialists and economists that can come up with the best model of indigenising each economic sector? Why not ask communities to come up with their own solutions, instead of imposing solutions in a prescriptive manner as we have seen?

There are many companies that need revival. Why not focus on those, rather than threatening to take over viable companies? Why not encourage these companies to list on the ZSE as opposed to creating a ‘black stock exchange’ (if there is anything that goes by that term)? In addition to that, not all Zimbabweans want to own companies; some don’t want the stress in their lives but just want a decent stable job. There is nothing wrong with that.

If Zanu (PF)’s motives for the achievement of its objectives are seen to be sincere and done transparently, Zimbabwean professionals will surely come to the party and assist.

Our politicians are missing the point. They are not the experts and they do not know everything. We are not against indigenisation at all. We have available to us the talent and the brains to develop Zimbabwe, provided we have a government that acts as an honest facilitator and is not a biased and partisan referee.

We must draw talent for developing the country from all Zimbabweans, regardless of party or race. We must embrace our diversity and use those in the Diaspora, who have significant experience, as a competitive advantage- and not look at them as a threat. We must shun partisan business practice because it does not bring our best talent to address the problems we face.

If we can begin to get this approach to our economic problems, then by all means we will support the effort. But as long as individuals within our government continue to bully or bulldoze their views on what must be done, we will leave it to them and watch them mess it up once more.

There is more than enough wealth in Zimbabwe for everyone to share and even enough to leave for the next generation. We must see an attitude of abundance and not one of selfishness and greed.

Our politicians must not be allowed to sabotage progress as has happened before. This must come first from the highest office. There are many senior ministers who have become bullies and have destroyed this economy in the pretext of indigenisation; that must stop. Numerous viable projects have stalled because of greed and political interference.

There is this tendency for us to always blame the “enemy” out there for our incompetence. It is time we all looked in the mirror and ask ourselves whether the enemy is really out there or within us? – Vince Musewe is an economist based in Harare. You may contact him on [email protected]

Post published in: Opinions & Analysis

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