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Umzingwane District’

D EPIZ
Andrew Sibanda

15 APRIL 2013 VENUE: BRED OFFICES

Presentation Outline
1. Introduction 2. Background of economic empowerment initiatives in Zimbabwe 3. Formulation of the policy and legal framework of indigenisation and economic empowerment 4. Policy implementation 5. Empowerment experiences : What has not worked 6. Focus on Matebeleland and Midlands Provinces 7. Recommendations: Making Empowerment a Reality 8. Implementation processes 9. Key Conclusions

Mtshede. and Esikhoveni. The study was commissioned for the purpose of providing vital information on the organisation’s enterprise development program . Matshetshe.Introduction The Baptist Rural Economic Development Trust commissioned a study to assess viable business opportunities in it operational areas of Umzingwane district’ namely Mawabeni.

Objectives of the Study 1. Mtshede. Matshetshe.Purpose of the Study The purpose of the study is to identify and analyse viable business opportunities around Mawabeni. 7/16/2013 . and Esikhoveni areas in order to advise trainee entrepreneurs on which opportunities offer the best chances for establishing a successful enterprise.

7/16/2013 . and Esikhoveni.Objectives of the Study 2. BRED will soon be opening a youth Development centre at Mawabeni Baptist Church offering various business services. Specific Objectives 1. To Identify viable business opportunities in Mawabeni. Mtshede. Matshetshe. They consultant should identify beneficial synergies and opportunities which will maximize the viability and self sustainancy of this centre. 2.

Program Background Training Centre /Company Training program Male School of Hospitality and Hotel and catering Tourism Westgate VTC Motor Mechanics 1 6 0 2 2 0 Number of trainees Female 9 0 4 0 0 1 Total 10 6 4 2 2 1 Fingers. Chane’s & Hair dressing Stalicholiuos Hair Salons Bulawayo Polytechnic Building Providence Film and Sound Sound engineering Community development Community development Metro College Bulawayo Polytechnic TM Hyper Bulawayo Polytechnic Total 7/16/2013 Fabric design Till Operation Computer technology 0 0 3 1 1 0 1 1 2 30 .

(i) Literature review Design of data collection tools Methods and Techniques (i) (ii) Enumerator training (iii) Mobilisation of participants (iv) Focus Group Discussions (v) Key informant interviews (vi) Assessment of existing business (vii) Data analysis and report writing (viii) Analytical frameworks 7/16/2013 .

Formulation of Empowerment Laws 7/16/2013 .

The I & EE ACT: 14:33: Key Features •Outlines the objectives of broad based economic empowerment •Provides the institutional framework for indigenisation and EE •Provides legal instruments for I&EE (General regulations (2010) and general notices) 7/16/2013 .

pace and focus •Implementation continues despite discord & disagreement in Incl. Gvt – PLC issued an adverse report on Gen. but differences on strategy. notice 114/2011 -Thus widely viewed as partisan & driven by political expediency instead of economic considerations.Reactions to policy implementation •There is consensus on need for policy. with little strategic efforts towards ensuring BBEE • Urgent requirement for compliance & application of 7/16/2013 strong arm tactics strengthen the political expediency . • Implementation viewed as narrowly focused on indigenisation than empowerment. regulations & gen.

• Establishment of community share ownership schemes in areas where mining companies operate total capital of US$114 million injected.Policy Implementation: Achievements •100% Compliance by companies mainly in the mining industry. • Establishment of the youth fund .US$10 million 7/16/2013 . •Establishment of employee share ownership schemes: 400 ESOTs created by November 2012.

Implementation: What has not worked •Slow down in new foreign direct investments •Slow down in Investment inflows • Flight of capital •Increasing difficulties in raising funding for critical projects •Challenges of mobilisation of financial resources •Violation of BIPPAs – Save Valley Conservancy 7/16/2013 .

This may be a result of a combination of factors than the result 7/16/2013 of any one .Failure to take advantage of available resources . though the Youth Fund is seen as generally unreachable. •Perceptions of regional Economic status . •BUT: There an enduring perception that Mat’land and Midlands are marginalized.Poor representation by elected leaderships . CSOTs.g. .Lack of initiative by people in Matebeleland . ESOTs.Focus on Matebeleland and Midlands Provinces Problem underpinning empowerment • Implementation I & EE seems uniform nationwide e.Reality : economic stagnation in the regions.Marginalisation .

Empowerment initiatives in Mat’land (1)DIMAF .80% of the US$40 million fund was allocated to about 17 companies in the region (2)Land allocations under the land reform program (3)A number of small projects funded under the youth fund 7/16/2013 .

Empowerment initiatives in Mat’land Empowerment Champions – Civil Society organisations (1)Jairos Jiri Association (2) Binga Craft Centre (3) ORAP (4)Amakhosi Theatre (5)Churches - Individual People’s Notable Efforts (1)Delma Lupepe – Industry and Commerce (2)Peter Ndlovu – Soccer and talent development (3) Raj Modi – Commerce (4)Brenner – Bulawayo Abattoirs 7/16/2013 .

(ii)Inclusion and Participation (iii)Accountability (iv)Local Organizational Capacity 7/16/2013 . fairly implemented. Key Elements of the BBEE Model (i) Access to Information: Information is power. but. existing policy should be localised. giving equal importance to ALL regions.No Need for Unique Policy: Proposed BBEE Model There is no need for a separate policy framework or different empowerment approach.

Proposed Broad Based Economic Empowerment Model Reform of State Institutions – Local and National Institutions Transparent Indigenisation Processes Privatisation Sector Rules and processes Participati on Access Empowerment level Poor People and their Sector Specific Empowerment Processes Individual & Collective Control BBE Empowerment outcomes Increased assets and freedom of choice Strengthened poor people’s organizations Improved governance and access to justice Functioning and more inclusive basic services More equitable access to markets and business services Strengthened civil society Improved participation in national issues CSOT ESOT NIEEF Preferential procurement % local ownership (51%)? Norms And behaviours Guiding Principles Information Inclusion/participation Accountability Local organizational capacity Awareness Welfare Medium to Longterm Supportive National context (political. social economic and legal) 7/16/2013 .

agricultural training. farming machinery & equipment. .Priority sectors for BBEE targeting (i) Land ownership and control: address leases and title deeds – include communal lands and protected lands . and market development . (ii) Agriculture: generally focus on improving infrastructure.national parks. 7/16/2013 . Develop local Tourism. (iii) Tourism and hospitality sector: focus on giving communities and businesses access to the resources to run the tourism in the forest areas and national parks.Livestock – commercialization. production technologies including seed technologies.Cropping: irrigation development.

and related cultural aspects. weak business structures & systems. (vi) SME/SMMEs: Address key challenges facing SMEs/SMMEs e. film production.g. marketing constraints. visual arts. crafts. music. poor access to finance. leadership and entrepreneurship: providing accessible.Priority sectors for BBEE targeting (iv) Arts entertainment and culture based enterprises: develop the arts to professional level. post secondary vocational training and education. poor capacity for R&D. with deliberate promotion of the various types of art including theatre. skills development. poorly defined regulatory frameworks networks 7/16/2013 . (v) Vocational Training.

There is a huge market for construction services especially due to the shortage of housing in urban areas as well as peri-urban areas (ix) Banking and financial services: Improved access to financial services (x) ICTs: improve access and affordability .Priority sectors for BBEE targeting (vii) Mining: Focus on small to medium scale mining operations addressing Skills training. Establishment of strategic mentoring relationships with large scale mining concerns (viii) Construction and related industries: Focus on manufacturing of building materials such as bricks offers important services. Strengthening small miners’ institutions for better collaboration. Improvement of TV and radio coverage: 7/16/2013 . Acquisition of equipment.

rather than redistributing the existing limited wealth. & define the term as a goal.2. productive engagement to create more wealth for poverty eradication. Broadly define empowerment to enable policy to be inclusive. . Emphasise development of a broad-based domestic pvt sector through innovative transformation of existing opportunities into enterprises to become the engine of growth & source of national pride 7/16/2013 Policy Recommendations 1. 3. Empowerment to mainly based on increasing participation through economic expansion. indicators & measurement criteria. & as a process. stating SMART objectives.

Empowerment policy to deliberately include instruments that allow for decentralisation of empowerment activities to relevant sectors and allow significant private sector involvement in the design of sector strategies and targets that allow for sustainable growth and higher success rates 7/16/2013 Policy Recommendations 3. guidelines and standards. that guarantee pre-conditions necessary for successful economic empowerment & allow ALL Zimbabweans to participate in the economic development of their country and earn themselves self-respect and dignity .4. 30 years) with options for lower local shareholding levels in the short to medium term 5. Government should focus on developing the policy and legal framework.g. The percentage of local shareholding (the 51%) should be the ultimate goal to be achieved in the medium to long term (e.

but stepping stones that investors should seek to adopt.e. empowerment considerations should not be seen as obstacles. Institutional changes to include private sector players in the form of representative bodies. Creative incentives for indigenisation should be used. Government. context specific rather than based on political considerations only. therefore. 3. The current economic context seeks to attract foreign direct investment. Govt then becomes policy maker and supervisor rather than sole implementer . private sector players and civic society should develop sector specific strategies to be implemented by private sector players on the basis of economic criteria through consultative processes Pace of empowerment to be based on the performance of the economy i. 7/16/2013 Strategy Recommendations 1.2.

There is a need to avoid the culture of grabbing as a strategy of indigenisation and empowerment. (7) preferential procurement should be broad based through making sure that the government tender system adopts a geographic area specificity and use the point scoring system in order to ensure equitable distribution of opportunities across regions 7/16/2013 Strategy Recommendations goals set by government and provide information on common indicators by sector . reasonable interest rate regimes and rules of access (requirements. (6) Capacity building of entrepreneurs should form the basis of all empowerment initiatives. e.g. collateral security). while at the same time giving perceptions of repulsive lawlessness. This approach violates international statutes and key principles of sustainable growth. there is a need to provide government backed financial instruments with appropriate pay back periods.(4)Civic society efforts to be channelled towards achieving clear policy (5) For empowerment to be successful.

and experience to deliver to required standards. .(9) 7/16/2013 Strategy Recommendations (8) create mandatory sector specific company grading and performance systems as well as systems for objective measurement of performance for those companies that have a desire to participate in indigenisation and empowerment programs. These should then be used in the awarding of work to appropriate companies that have the required capacity. equipment.

identify capacity gaps both at corporate. The program should define SMART sector specific objectives and strategies based on sector approach with sensitivity to regional variations. community and institutional levels (iii)Develop an a result oriented empowerment program through inclusiveness democratic processes of participation.(ii) Conduct a capacity audit by sector. Short. outcome and impact levels. and impact levels) against which 7/16/2013 Implementation process (i) Identify and characterise the causes of disempowerment or vulnerability of different population groups in their locations . (iv)Identify and select performance indicators (at output. medium and long term results should be defined in their result chains at output. and define the existing capacities. outcome.

local government. 7/16/2013 Conclusions •Rather than providing answers.How can the empowerment agenda be better communicated and used for the benefit of all? . civil society and the private sector. -What should be the roles of government.g.How can there be better local ownership of national policy on indigenisation and economic empowerment agenda and process? . and what are implications for current practice. the paper helps crystallise to key questions on the empowerment agenda e..What are the different ‘tools’ available for policy localisation. .

the beginning of work processes that must lead to real broad based economic empowerment 7/16/2013 CONCLUSION . There are a number of factors that determine the successful implementation of localised policy. it is important to note that. Policy localisation therefore. while there is value and clear benefits in localising national policy. is not an end in itself. on its own localisation is not a panacea to economic empowerment.Finally. but.

SIYABONGA 7/16/2013 THANK YOU! .