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Zimbabwe govt pushes for private sector-driven economy: Finance Minister

Zimbabwe govt pushes for private sector-driven economy: Finance Minister

HARARE:  The Zimbabwe government is pushing for a private sector-driven economy and its role would be to provide a conducive environment for business, Finance and Economic Development minister Patrick Chinamasa has said.

Speaking at the Confederation for Zimbabwe Industries (CZI) 2015 Economic Outlook symposium yesterday, Chinamasa said currently there were many more managers than entrepreneurs and this was not good for the growth of the economy.

“Our dream as a government is to have a private sector-led economy. This can only be achieved if we have corporate entrepreneurs who are prepared to take charge of their own destiny,” Chinamasa said.

“My message this morning is that, there is need to adapt to the dynamic business environment in order to build sustainable business. And this demands that business leaders do the right thing.”

He said there was need to enhance industry competitiveness by being innovative as one of the ways to sustain the economy.

Chinamasa said the manufacturing sector should not remain stuck in the business models of yesteryear.

“Let me hasten to say that it is not the company that ‘does the right thing,’ but individuals. People at the top of the companies must do the right thing that will in turn be transmitted down to their teams,” he said.

Chinamasa encouraged industry to grow diversified exports base in terms of products and markets and also to take advantage of closed business by coming up with innovative structures to resuscitate the businesses.

“Who was running the businesses that have since closed down and what are we doing as businesspeople to take advantage of this? Can’t we come up with innovative structures to resuscitate those businesses?

“What are we doing to grow a diversified export base in terms of products and markets? There appears to be a lukewarm approach to export business following the adoption of the multicurrency regime. I would want to challenge you to have a re-look at your business models because we need exports. Growing exports will go a long way in addressing the liquidity conditions that we continue to talk about,” Chinamasa said.

Speaking at the same event, economist Tony Hawkins said until the 21st century, growth was driven by industrialisation but this model was being overtaken.

Hawkins said the global and regional value chains, intangible capital, skills and services have raised the bar to entry into manufacturing.

He said offshoring factories and jobs to low-wage areas was losing its appeal as labour and other costs of value-chain management rise.

“Today, it is cheaper to manufacture in Mexico near-shoring than China and the United States of America is only 5% to 8% more expensive than China.

“Geopolitical risks have proliferated and escalated. Managers are now more risk averse, switching focus to shorter, safer supply chains in the form of near-shoring or re-shoring, and avoiding high risk locations,” Hawkins said.