Economy – Now or Never (

With the economic trajectory having taken a depression which has seen economic growth prospects succumbing to lack of investment, recapitalisation failure, sector underutilisation and suppressed local demand aggregates, 2015 has economic stakeholders bracing for an uncertain, likely rough and turbulent ride.
The year 2014 stands out as a year that many would rather quickly forget on the local front. It had the highest number of job losses, company closures and crippling sector under-performance, radical political changes and exposition of corruption and public office maladministration. Globally, political conflict and aviation disasters took over news headlines.
Coming back home, going into 2015, major economic fundamentals remain unattractive as implementation of the economic blue print faces immense obstacles.
Recent industry statistics on company closures, declining profitability and increasing unemployment fall short of inspiring any form of economic confidence.
The questions lingering in the minds of many are, “what is different, who is different and what will they do differently in 2015”, these and many other questions leave economic stakeholders short of hope.
With time running out for the implementation of the economic blue print which remains the optimism of economic revival, a lot still remains to be done to lay the ground work for the successful implementation of economic policy and strategy.
Investor perception towards the country remains sceptical. If we are to attract any meaningful foreign investment that comes close to what neighbouring countries like Zambia, Kenya, Mozambique and even Malawi are attracting, there remains myriad changes that need to be made.
Last year Zimbabwe attracted less than one percent of foreign inflows to Sub-Saharan Africa alone, not to mention the whole of Africa.
Ironically countries which we have looked upon as potential major players in our economy have invested far much more in a single year in other countries than what they have done in more than four years in Zimbabwe.
This should speak volumes in terms of investor perceptions towards Zimbabwe. Unfortunately investment decisions are anchored more on Risk and Return profiles more than political affiliation or patronage.
Zimbabwe’s economic hope lies more from internal initiatives than from external factors like foreign investment; locally brewed initiatives when extensively implemented will drive growth from within and consequently attract external economic support.
The playing field has to be conducive and “plain”if the game is to be played. The politics has to be right, policy inconsistency and disharmony has to be ironed out, accountability in public resource management, and efficient allocation and utilisation of resources respect of property rights and prioritisation of broader national interests above personal interests.
Without dedication and action from all stakeholders, the economy will melt down while we point fingers at each other and offer comments from the comfort of our misery-like spectators to our own end. It will take the involvement of all stakeholders to get this economy going again.
The fortunes of our future lie not sorely in the hands of politicians, foreign investors, captains of Industry or economic analysts but are rather anchored on the collective involvement of all Zimbabweans and stakeholders.
Waiting on the sidelines and playing the blame game will not work in anyone’s favour any more than will selfish pursuit of personal interests at the expense of the broader economic interests, the onus is on every Zimbabwean to take some form of action.
Evil prevails when good men fail to act; those who stand by and watch while national interests are sacrificed for self-interest are just as guilty of accomplice to economic sabotage as the perpetrators.
It is the responsibility of every Zimbabwean in one way or the other in their different respective ways to play a part in the economic future of the country.
A common phrase in biblical scripture reads, “To whom more is given, more is expected” to those who have had the opportunity, or rather responsibility to take charge of public office to oversee the running of state enterprises, a greater responsibility of prudence and care is expected.
Efficiency in the public sector has been the epicentre of Industrial growth and development in the very economies we admire as they lead global economies, US ( $17,5 trillion), China ($10 trillion), Japan ($4,8 trillion) and Germany ($3,9 trillion) to mention but a few.
In these thriving economies, State enterprises operate proficiently, ensuring the efficient allocation of resources, accountability and competence is given the utmost priority.
Zimbabwe’s resource management structure is skewed towards the nationalised end of the spectrum, with major sectors like Mining,
Infrastructure Health and Agriculture being owned by the Government. In this case Government and its related public and quasi-public corporations has capacity to employ around 30 to 60 percent of the labour force, as is the case in other cases with somewhat nationalised national structures in China, Japan, Russia, along with other emerging market economies.
Operating at full capacity, various State Enterprises and Government Departments have the potential to drive consumer spending which should be larger in percentage terms of GDP than any other national income component.
Zimbabwe’s situation however tells a sad ordeal, Consumer spending is ever shrinking by the day as more and more people lose their jobs from company closures and downsizing, the informal sector has reached saturation as it had to play alternative to formal employment.
It would be a move that defies logic to think that action and implementation of economic revival policy can be postponed for some future date as this would have deer consequences. The time for plans to gravitate into reality is now; in fact it’s now or never,
Norumedzo is an equity and alternative investment analyst
Source: Politics