Resources nationalism: The other side

HARARE - On reading the Daily News editorial on Wednesday, I was very concerned to see expressions of political acceptance of many highly-contentious points.

I would argue that serious misconceptions are keeping many unhelpful policies on our statute books and it is a source of some dismay to find that your paper is carrying editorials that repeat and apparently approve of highly questionable policies, even though they are clearly not working for the good of the nation.

“Policy accruals” imply empowerment advantages, but no evidence to prove the existence of any real benefits has ever been offered.

Instead, huge job losses have been experienced.

Compelling anyone to surrender assets of any kind is theft. Passing a law that makes it “legal” does not make it right.

Resource nationalism carries no automatic “moral rectitude” component.

For thousands of years, Zimbabweans have had all the rights needed to exploit the country’s mineral wealth and we still have these rights.

Only now that others have identified their value are we demanding that they respect our rights.

We should be running the mines, but if we lack the ability to even start them, we should be grateful for the jobs, incomes and tax revenues delivered by those who take on the risky investments.

Resource nationalism is not noble. It is shallow, dishonest and damaging to the development process.

Agrarian reform also lacked nobility, specially as it failed to deliver the promised advantages.

Profound differences between those who work for what they want and those who claim their authority empowers them to take what they want will never produce an egalitarian spread of benefits. Zimbabwe is now a backward, impoverished society because of these dishonest claims.

Community share schemes have not yielded useful dividend cheques because the indigenisation process has halted the development and eroded company profitability.

The process is destructive for everyone, original shareholders included.

People waiting for a process to deliver something for nothing are always going to be disappointed.

They should express their anger at those who promised riches and empowerment, not at those whose companies were crippled by a process that arrested investment and destroyed initiative.

The indigenisation thrust is the problem.

It promises, but cannot deliver, a short cut to incomes that will be extracted from non-indigenous people.

These incomes must inevitably evaporate because the demands imposed by indigenisation will kill them. So this promised transfer of wealth cannot happen.

Real empowerment comes from a community’s acquisition of the skills needed to generate good incomes and from the application of these skills in productive work.

Real empowerment cannot possibly come from the confiscation and redistribution of the assets of others, whoever they are.

This portrayal of foreigners squirrelling profits back to their countries of origin does not apply to pre-independence Zimbabwe.

The fact that the country became one of the most developed in the entire Third World was because the owners of the businesses reinvested most of their profits right here, in this country.

The dividends they paid were always a tiny fraction of the amounts they paid in wages, or salaries, or taxes, so the major beneficiaries were always the local people.

The restructuring of the empowerment policy should start with a restatement of the policy of wealth redistribution.

Wealth should be defined, not as money, but as the ability to make money.

In that definition, wealth therefore equates to ability.

How ability might be redistributed then becomes the subject of the empowerment process. The acquisition of ability is all about education and the use of knowledge in the workplace to gain experience and generate skills.

So another essential is employment. And every productive job in existence is created by the investment process.

Investors are attracted by acceptable policies. Indigenisation demands simply do not qualify.

Comments (2)

Its always easy to pass disparaging remarks when you have benefited from past policies indeed. "Wealth should be defined, not as money, but as the ability to make money". A very interesting definition. So if you have ten times more money spent on you on education more than the next guy you will have more ability, and consequently more ability to create wealth.How do we get the other fellow to catch up with you one might ask. I think when we have economists who just criticize but don't offer viable solutions we will continue to get stuck. To the daily news I ask, "Do you really need to keep giving this guy space to say his gibberish?"

Mukanya - 17 December 2013

You cannot make poor people rich by removing the rich. They can only become rich by emulating the rich. The new laws are meant to remove distortion in the system and not to reate new ones.

Timothy Thorton - 19 December 2013

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