Govt mustn't shut out local entrepreneurs' … Kurotwi bemoans state of the economy

Following President Emmerson Mnangagwa’s Eurasian tour — that took him to Russia, Belarus, Kazakhstan, Azerbaijan while he had to cancel his attendance at the World Economic Forum at Davos, Switzerland as Zimbabwe was burning in his absence — we heard that a Russian firm, Alrosa, and the Chinese Anjin, will partner the Zimbabwe Consolidated Diamond Company (ZCDC) in the extraction of diamonds in Manicaland as well as other projects in the country. 

The Daily News on Sunday’s Production Editor Eddie Zvinonzwa this week spoke to former Core Mining director Lovemore Kurotwi, who in 2016 was acquitted by the High Court following a five-year trial on charges of prejudicing government of $2 billion, on this and other aspects of the Zimbabwean economy. Below are excerpts of the interview.

Q: In general what direction do you think our economy is taking?

A: No direction to be specific. There are a number of things that should happen. The most important one, which is very critical both for the government and its people is that of confidence-building. 

We have reached a level where we must swallow our pride as Zimbabweans and be realistic then go back to the drawing board. 

The nation should have confidence in its government while government should also have confidence in its people. Once that happens, everything else falls into place. 

The much talked-about Foreign Direct Investment (FDI) will also come. I have said this in one of my books Whither Zimbabwe: The Industrialisation of Politics in Zimbabwe. 

It is only in Zimbabwe where politics is prioritised at the expense of business. All other countries worry about their business more than politics. 

They defend their reputation but sadly in Zimbabwe we are not ashamed of killing one another, we are not ashamed of violating people’s rights and still expect to compete with other nations in attracting FDI.

If we compare ourselves with one of our closest neighbours Botswana, they are well-known for observing the rule of law and respect for human rights.

Q: Are you suggesting that government does not err? 

A: We are not saying they don’t have weaknesses, they are a government run by human beings and bound to err here and there but what is important is for government to protect its people. 

I believe we all make mistakes but in the event that such a thing happens, it is important for them to acknowledge their mistakes and move forward. 

Some of the issues that complicate us as a country are very simple, in my own view, which can be solved by dialogue between government and its people. The way forward will emerge from that engagement.

Q: Towards the end of last year, government came up with the 2 percent on all electronic transactions. How do you view that policy.

A: Finance minister Mthuli Ncube’s 2 percent transactional tax is serving a purpose for government, but it is not fair to come up with unilateral decisions. Government should consult and advise before implementing. 

No matter how noble the idea might be, the nation may not take it the way government wants it to be. Those are some of the decisions that make the whole nation wonder which direction government wants to take and for whose benefit the programme is designed. We are entrepreneurs in this country but we only get to know about opportunities when they are given to foreigners. Why does government not respect its own businesspeople?

Q: Where has the consolidation of diamond mining placed you?

A: I am one of the first people to bring in proper diamond mining technology in this country, which the very same government confiscated. They took $160 million and $14 million worth of equipment. 

It is strange to hear the same government professing ignorance about our capabilities as Zimbabweans. Why is it that government loves to enjoy the proceeds of Zimbabwe’s God-given resources with foreigners? It is not true that citizens of this country have no capacity to exploit Zimbabwean 
diamonds. 

In other words government has nationalised that sector in order to block locals from participating. When they consolidated we thought they were going to do that on their own for Zimbabwe’s benefit, little did we know that they were doing so in order to surrender to foreigners. There are arguments that we have no capacity as Zimbabweans to mine diamonds. It is not true because the equipment they have continued to use for almost 10 years now is our equipment and the $160 million they have refused to release is for us Zimbabweans.

Q: Government has since invited Alrosa and Anjin to partner ZCDC. What do you say about that?

A: I would be very happy if government gives us the rationale behind all this. For how long does government want cutting deals that continue to benefit foreigners. The world over, government would defend their citizens’ access to their natural resources and general business so that local companies benefit. They cannot continue to shut out local business in areas where they can compete.

Q: The country recently witnessed ugly scenes during the shutdown with protests engulfing most urban areas, especially Harare and Bulawayo, what do you think is the net impact of this?

A: The protests had serious repercussions because in the first instance they showed that as Zimbabweans we were not pulling in one direction.

It remains government’s responsibility to ensure that the whole nation heads towards the same direction. In a way how can we have re-engagement when our own house is on fire? 

It is not beneficial now to be talking about re-engagement. We must instead go back to the drawing board. Government cannot do anything without the people and vice versa. 

On another level, government is busy burdening itself with a job that is not for them. They should be concentrating on policy formulation, policies that encourage existing business. Once local business is happy, FDI will come.

Q: You seem to have other ideas on how Zimbabwe should proceed as a country, would you like to share these?

A: We are putting ourselves in unnecessary confusion. We must be producing as a country. That is what the fundamentals demand. We must export. Whatever currency we adopt will ultimately not work because we need to export and earn our own foreign currency 

Even if we eventually have our own currency, which is the right thing to do, we must support it by producing.

We are fortunate that we have land as a country. We can produce enough. Once we produce, it stimulates our agro-industrial base and we will start employing. We must produce enough sunflower and maize for instance so that we have enough cooking oil. 

Currently, our priorities are upside down, foreigners cannot come and till our land for us. We have got minerals, but what are we doing with these? Botswana’s GPD is anchored on diamonds. We have got the same resource but what are we doing? 

Mining is a low-hanging fruit which government was supposed to take advantage of. Because they do not trust anyone, they cannot sit down with any local to discuss how this resource can be exploited.

I have been on record for the past 10 years to be precise, talking against the selling of rough diamonds but because I am a Zimbabwean, nobody listens.

Other countries like India have created hundreds of thousands of jobs from our diamonds. In 2012, alone, India created 60 000 new jobs from Chiadzwa diamonds. Why is government not looking at our high unemployment figures and design policies that work to reduce these.

Q: How do you think government must consult?

A: They must have a mechanism that will cater for all Zimbabwean industrialists. They should not just focus on the Confederation of Zimbabwe Industries (CZI). They must put up a framework that will work. 

Former president Robert Mugabe used to be advised by the very same people who are in the setup today. Government must reach out further because there are other people outside the CZI who have got brilliant ideas. 

We claim to have one of the highest literacy rates on the continent but we are failing to run a little country like Zimbabwe. 

Perhaps we are claiming to be learned in the art of perpetuating poverty among our people.

Q: So in your opinion, where is the problem?

A: We are already in planning mode for the next election only due in 2023. Government should get out of their election mode. We want to hear the number of new factories we have opened and also how much land we have put under what specific crop. I am not a politician but I speak like a businessman. 

Alrosa is a Russian company, which is being supported by the Russian government. Why are we not supporting our own. 

Government seems to be closing business for locals while opening opportunities for foreigners. 

Probably the mantra government is moving with must change to ‘Zimbabwe is open for production’. That should be the new mantra. 

Zimbabwe is open for business no longer has any takers. Manna only fell in Israel, we must work and I know for sure that we can turn this economy around on our own.

 

    Comments (2)

    I agree in toto with this gentleman, the indegenisation law was a noble thing, why disadvantage your own and meanwhile allowing foreigners ie Chinese to reap were they did not sow, try and open a business in Botswana without a local. To be honest we need wise leaders, this country will end up belonging to foreigners .

    John Shumba - 6 February 2019

    One can still do well in the diamond industry regardless. Manufacturing in Botswana and South Africa is the way forward. Good read there.

    Siyabonga Osinberg GmbH - 6 February 2019

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