Top businessman backs parastatal reform drive

HARARE - Zimbabwean serial entrepreneur Frank Buyanga is backing government’s drive to seek global investors to engage in the privatisation of struggling State-owned companies as part of wide-ranging reforms set in motion by President Emmerson Mnangagwa since he came to power.

Buyanga has since 2016 been making a clarion call on government to reform the loss-making State enterprises, saying their turnaround was instrumental in curbing high levels of unemployment and shoring up crumbling public infrastructure.

This comes as Finance minister Mthuli Ncube, a former banker, has been tasked with turning around State companies that have plunged public finances into crisis in recent years, with most of them on the brink of bankruptcy.

Ncube has said results of the reform drive should be expected in the next six months.

“We should be able to move with speed in the next six months so that we are able to get suitors that will make partnerships with these institutions,” he told reporters.

“In that privatisation I am insisting that we must advertise globally; the United States, United Kingdom, Japan; to make sure that we have the best partners and then we get the foreign direct investment that we so much require, the best technology and ways of managing these parastatals so that they become better companies. It is not enough to advertise on the local media.”

Buyanga believes the solution is to lure new investment into the country, not to totally offload the State-enterprises. He also urged government to tackle deeply entrenched corruption within state institutions with the full might of the law for the economy to grow.

Buyanga said: “This is a listening government. I strongly feel that the government should come up with additional strategies to curb corruption, improve capacity utilisation (in industries) and instil a culture of accountability within all government parastatals as well as any companies that government has a shareholding.”

He said mismanagement in state-controlled firms was the major reason behind high unemployment, a severe deterioration of public infrastructure, a rising informal sector, diminishing public confidence in government and an exodus of Zimbabweans to other countries.

Buyanga has previously written to the office of former President Robert Mugabe urging him to pay attention to the scourge of corruption that was eroding the value of the state-owned companies.

In 2016, Buyanga said in a letter to Innocent Tizora, director of State residences in the Office of the President and Cabinet: “Dossiers and reports have proved massive misappropriation of resources across the commercial divide and this inevitably has a direct impact on the welfare of the Zimbabwean people.”

Meanwhile, minister Ncube has said he has “done a lot of work in terms of classifying parastatals earmarked for reform into various categories; those that can be privatised or transformed, merged, liquidated; that are no longer required, or those that can be subsumed into existing mini The Investment and Business Facilitation Bill, which seeks to give legal underpinning to Zimbabwe’s commitment to opening up the economy is undergoing due legal process, is still to be enacted six months on.

Under the State enterprise reform exercise, NetOne, TelOne, POSB, IDBZ and Agribank will be partially privatised along with subsidiaries of the Industrial Development Corporation (IDC) which include Zim Glass, Allied Insurance, Surface Investments, Zimbabwe Grain Bag, Ginhole Investments, Chemplex Corporation, Deven Engineering and G & W Minerals.

In a bid to do away with duplication, the government will merge Zarnet, Powertel and Africom to create one company while the Postal and Telecommunications Regulatory Authority of Zimbabwe (Potraz) and the Broadcasting Authority of Zimbabwe will be combined to create one telecommunications regulator.

The Daily News understands Cabinet has begun considering and adopting submissions on targeted entities beginning next week.

Each Cabinet meeting will consider submissions on two public enterprises, and started with Zisco and Chemplex Corporation.

Speaking at the weekly cabinet press briefing last week, acting Information minister, who is the minister of International Trade, Mangaliso Ndlovu said the investor responsible for the revival of Ziscosteel is expected in the country next month.

"The investor is coming in the coming in the country to assess work on the ground at Ziscosteel because work is expected to start in January," said Ndlovu.

Although Ndlovu did not name the investor, it is believed Chinese Zhang Li had dangled a $1 billion investment to revive the largest steelworks company which employed about 5 000 workers at its peak and has not been fully operational in the past decade.

The company is weighed down by a $400 million debt including workers terminal benefits.

Chemplex, a fertilizer and chemicals manufacturing company, will be partially be privatized as government moves to dispose of non-performing public enterprises.

 

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Comments (5)

No need for partial privatisation. It must be 100%. Government must move out of parastatals completely. All parastatals have failed. Look at Air Zimbabwe, Zisco Steel, Zupco, ZESA, CSC etc. Carnage everywhere. On top of this they give contracts to guys like Chivayo.

Ndiani Ndiani - 3 December 2018

Kana vana Bunyanga vava ivo maTOP businessman nyika kwayaenda hakuchadzokwa...

Kumbirai - 4 December 2018

Tycoons Van Hoogstraten & Buyanga are of course partners. They could also be described as moguls or magnates. Good luck to them trying to beat ZANUPF at being first at the till which more often than not is empty ! ZW with ED in charge - same circus but now run by different clowns comrades

ace mukadota - 4 December 2018

Buyanga huya ne peturo shasha....ndiweka une $1Bn

Fuel man - 5 December 2018

Can't some of these 'moguls' set up a retrenchement fund for the civil service? Then government can DEMONSTRATE it's commitment to reducing employment costs

Wondering - 7 December 2018

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