Courts will determine wrong or right in ZAMTEL sale – Guy Scott
TIME PUBLISHED - Tuesday, January 10, 2012, 8:53 am
Government says it will be up to the courts of law to determine who was wrong or right in the sale of the telecommunications company Zamtel to Libya’s LAP Green.
Vice president Guy Scot has exclusively told QFM that the matter which he said would be a civil litigation would tell who is liable in the Zamtel Sale case after it is heard in the courts of law and all the evidence is given.
The vice president however declined to comment further on LAP Green’s reaction to media reports that government has reversed the sale of Zamtel saying the government would not try anyone through the media.
In a statement availed to QFM over weekend, newly appointed LAP Green board chairman Wafik Alshater said LAP Green will pursue all options and do everything possible to retain its stake in Zamtel claiming the Libyan firm legally acquired its 75% shares in the company.
Meanwhile, The Private Sector Development Association has called on the Zambian government to quickly resolve the issue of the sale of Zamtel to LAP Green of Libya.
PSDA chairperson Yusuf Dodia says government should ensure also ensure that sale of ZANACO to Rabo bank is resolved.
Mr. Dodia says the two companies are very important in far as foreign investment is concerned to Zambia.
The vice president however declined to comment further on LAP Green’s reaction to media reports that government has reversed the sale of Zamtel saying the government would not try anyone through the media.
He says if the government handles the issues very well, and assures confidence in the economy, they will boost foreign investors’ confidence in the country.
He adds that Zambia needs foreign investment as it aids the development of the country.
QFM
Labels: CORRUPTION, GUY SCOTT, LAP GREEN, PARASTATALS, PSDA, RABOBANK, YUSUF DODIA, ZAMTEL, ZANACO
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Small-scale industries
By Yusuf Dodia
Tue 09 Feb. 2010, 04:00 CAT
The integration of various state economies with their specific peculiarities, into one global economy overseen by the World Trade Organisation brings out new challenges for developing nations.
The protectionist mechanisms that traditionally supported small scale industries (SME’s) have had to fall away as WTO rules become enforced in developing economies. India has experienced the survival crisis for SME’s as a result of globalisation, and some vertical and horizontal evolution has taken place in response to the shifting environment.
On the vertical axis, many micro enterprises have emerged as some SME’s down-size and opportunities for new entrants into business become more visible. Conversely, some SME’s up-size to develop greater economies of scale, and embrace a larger portion of the value chain of production. On the horizontal axis, many SME’s have had to consider product changes and sector changes in order to survive by providing the right product for the right industry that is doing well in a particular environment.
For example in an economy where construction and other civil infrastructure developments are doing well, the SME sector has had to do some extensive research to find niche products and services that can be produced and offered to the large corporates in a bid to become a player in the construction value chain. Good specific examples have been steel riggers and rigging accessories, the manufacture of electrical accessories, the production of selected plumbing components, the supply of roofing accessories, and the development of various work tools and accessories for the construction sector.
Similar options can be developed in other prominent sectors such as food processing, agriculture, and tourism.
The SME sector deserves to be given a second look in respect to facilitation and promotion. The Citizens Economic Empowerment Commission, the Development Bank of Zambia, the Zambia Development Agency, the Ministry of Commerce Trade and Industry, the Ministry of Youth and Sport, the Ministry of Tourism, and the Ministry of Culture, all have a significant role to play in supporting and developing the SME sector.
It has already been acknowledged across the world that the SME sector is the backbone of any economy. Japan, India, China, and the Asian Tiger economies have all built their strong production bases on the SME sector. 88 per cent of Japan’s economy is based on the SME sector. The developed economies of Europe and North America have been financially battered partly due to the fact that corporations dominated the domestic economies such that a crisis in a corporation became a crisis for the nation.
This phenomenon basically makes the survival of private corporations the responsibility of the government rather than the shareholders, because of the possible large scale loss of jobs and heavy impact on the financial systems that a corporate collapse would cause.
Having learned the lesson, developing economies must rethink social and economic development strategies. This does not necessarily mean that all development programs must be abandoned. The SME challenge requires us to possibly focus more attention on the rapid and sustainable growth of the SME sector as a key program in the development agenda.
Part of the SME strategy requires developing economies to put in place a mechanism that ensures that when a large scale business or industry is established in a particular area, a linking program is immediately installed to promote SME’s to pick up the opportunities generated by the large investment.
Economic Zones, Industrial Parks, Mining Investments, Big Industries, Large Tourism Investments, Farming Blocks, and Corporate Services Providers, are all opportunities for SME’s to emerge and flourish and build the production base of the country.
The potential for SME’s is great, but three main provisions need to be in place for the potential to be unlocked. First, business promoters must become aware of the opportunities to supply goods and services. Second, there needs to be an availability of relevant skilled labour. Third, finance must be made available in a timely manner and at affordable rates.
The government, and specifically, the Ministry of Science, Technology, and Vocational Training, and various business and support organisations must assist to build the SME sector through the promotion of new and appropriate technologies; the hosting of SME development meetings for interested stakeholders; and dissemination events to highlight the opportunities for SME’s in the COMESA region.
We must keep in mind that as soon as the COMESA Customs Union is implemented, our economies will be integrated. The implications are that those countries in the region that have strong and sustainable large industries will dominate the region at some level, and those countries that have a vibrant SME sector will grow their economies even faster as they exploit the bigger markets offered by the region.
Zambia has some comparative advantages in the mining industry and can take advantage of this special endowment. However, Zambia does not have a monopoly of large investments within the region and therefore has no choice but to focus on an aggressive SME development program to remain a competitive and equitable member of the customs union.
Development of the SME sector is the way forward now, and will be the way forward for Zambia in the medium term. The big businesses should be encouraged to invest in Zambia, but not at the expense of sidelining our focus on Small and Medium Enterprises.
Labels: GLOBALISATION, SMEs, WTO, YUSUF DODIA
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Way forward
By Yusuf Dodia
Tue 05 Jan. 2010, 04:00 CAT
2010 is now here and life must go on. The region has been in frenzy over the 2010 World Cup with special impact on the Southern African countries. Even Zimbabwe, which is grappling with recovery from an economic meltdown, is targeting at least seven top world cup countries including Brazil, to set up camp in the country.
Zambia is also grappling with finding some solutions to the growing power deficit as industry, mining, and agriculture continue to register growth. There is a seeming impasse highlighted by the inconclusive path and way forward for Zambia’s fibre optic backbone as Zamtel and Zesco struggle to come to some meaningful understanding as they roll out billions of kwachas of tax payer’s money on infrastructure development. No solutions are yet in sight in respect to the fate of Indeni Oil Refinery.
What is the way forward? What institutions are best placed to help the country steer a course that will hopefully lead to prosperity? Where will the resources come from? How can we best use our comparative and competitive advantages for economic development? What is happening in the regional and global economies? How do we adapt to the new challenges?
It is quite obvious that one initiative for the way forward is for government to strategically partner with the private sector using both the Public Private Partnership (PPP) program and other mechanisms such as Ministerial authority to appoint boards for public institutions. This strategic alliance will bring to the table government’s national agenda for development and the private sector’s practical experiences and concerns that need to be addressed before businesses start to invest flat out in the economy.
The current problems experienced at Zesco in respect to the future developments of the national fibre optic backbone indicate the lack of dialogue between the board and their parent Ministry, and also the seemingly lack of dialogue between the Ministry of Energy and the Ministry of Transport and Communications. Zambia needs to develop sincere and productive PPP relationships at policy formulation levels such that the national interests always come first.
In the same vein, the challenges of becoming an active player in the Comesa Customs Union requires the same partnerships because ultimately the private sector will be required to spearhead intra regional trade that should benefit the country as government recedes into the background with diminishing political influences on the trade regime. Private companies will have to take responsibility for sustaining their own businesses and remaining viable as government steps back and removes the protection that many companies have enjoyed over the decades.
One key sub sector is the insurance business which is currently protected by legislation from outside competition. Already the Comesa yellow book third party insurance for motor vehicles is blind to sovereign borders and this phenomenon will only grow with other insurance products. Poor performers will soon become vulnerable to losing business to the good service providers when the Customs Union becomes active. For the private sector, getting involved in strategising on how business can be best done under the Customs Union regime is a matter of survival and not choice. This also applies to the government because a growing and vibrant private sector reflects higher tax collection which finances the national budget and other development programs.
At government level, the need to be more prudent with government expenditure is of prime importance. To this end, monitoring and evaluation of the budget roll out is one way forward to ensure that public money is building the economy. This does not necessarily mean that government should trim down the size of the civil service, but on the contrary, government should become more efficient, cost effective to the tax payer, and possibly should employ more civil servants to deliver the services that the growing economy requires. The size of the government workforce is dependant on the service demands made by both civil society and the private sector. A strong continuous monitoring and evaluation system in government, coupled with a remedial system that will patch up the weaknesses and gaps, will go a long way towards developing an effective and delivering public system.
The way forward in 2010 is to move on from the hype and marketing of economic zones, to the implementation stage. Value addition for copper and other minerals will develop the economy exponentially. Food processing and other assembly plants will be strategic as feed stock for products into the region. The opportunities for private sector employment and emerging small businesses are great when focused on the impact of economic zones on the economy. Some useful ideas and diversification options can be unlocked through the economic zones initiative.
The Sixth National Development Plan (SNDP) is on the table awaiting finalisation. A PPP approach to streamline this document for the private sector to use in business development will surpass the achievements made by the FNDP. More private sector input will give the SNDP credibility and will channel the strategies and investments that government will make in developing the economy towards real issues and concerns faced by the private sector.
Partnership at the domestic level prepares the nation to deal with the challenges of the global economy. Zambia is negotiating with the European Union to finalise an economic partnership agreement, and at a higher level, the country has to input at the World Trade Organisation meetings to ensure that developing economies are not trampled by the developed nations, but are supported to grow and become self sustaining. These pressing negotiations require the full wit of the nation through strong partnerships at the domestic level and good partnerships at the regional level.
Every economy has the challenge of building infrastructure to service the aspirations of the people and to promote, support, and facilitate economic development. The way forward for Zambia is to first decide clearly about what infrastructure should be built by government to support both social and economic development, and what infrastructure can be left to the private sector to develop for business enhancement. This distinction is paramount to deciding the role of government in economic development and the role of the private sector in building a country. The way forward for Zambia in 2010 is actually in our own hands.
Labels: ECONOMY, NEOLIBERALISM, PPPs, YUSUF DODIA
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Mines unions want mineral royalties hiked
Tuesday, October 13, 2009, 18:03
The National Union of Miners and Allied Workers (NUMAW) has supported calls by the International Monetary Fund (IMF) for government to increase the mineral royalties and corporate taxes in order to increase its revenue.
Commenting on IMF’s calls that government should increased mineral royalties and corporate taxes to enhance the country’s revenue, NUMAW president Mundia Sikufele said the current mineral taxes collections were not sufficient enough for country to benefit from.
Mr. Sikufele told ZANIS in an interview in Lusaka today that there was need for the government to quickly revise taxes in order for the people in the mining sector to have an opportunity to benefit from the country’s mineral resources.
He noted that since most of Zambian citizens were in the informal sector, there was need to increase mineral royalties for government to have more revenue.
He explained that by increasing the mineral royalties, people in the mining sector will also be given a chance to contribute to the economic growth of the country through paying other taxes.
Meanwhile the Private Sector Development Association (PSDA) has advised government to treat mineral taxes like any other business taxes in the country.
PSDA Chairperson, Yusuf Dodia, said in a separate interview that government should consider keeping the mine taxes constant at all times if it is to expand its revenue collection base.
Mr. Dodia said there no need for government to change the taxes whenever copper prices fluctuate on the international market.
He said government should ensure that taxes were maintained in a concession manner and not to make them exorbitant.
He pointed out that the reason why government has failed to make meaningful gains from the mine taxes was due to lack of having permanent corporate mineral taxes for the mining sector.
Mr. Dodia further challenged investors in the mining sector to take advantage of rising copper prices on the international market and make significant contributions to the development of the sector and the country as a whole.
ZANIS
Labels: IMF, MINING, MUNDIA SIFUKELE, NUMAW, PSDA, WINDFALL TAX, YUSUF DODIA
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Govt to remove bureaucracy - Musokotwane
December 22, 2008
Finance and National Planning Minister, Situmbeko Musokotwane said the Government would encourage private sector participation by removing bureaucracy and making it easy for people to start doing business.
Private Sector Development Association (PSDA) chairperson, Yusuf Dodia urged the Government to avoid borrowing from banks next year so as not to create more pressure on the financial sector.
Mr Dodia said the Citizens Economic Empowerment Commission (CEEC) and the Development Bank of Zambia (DBZ) should be merged so that they could assist Zambians in starting up businesses.
Another businessman, Jeremiah Dauya said the Government should give local businesses incentives to enable their products to compete with imported items.
Meanwhile Dr. Musokotwane said donors have pledged to fulfill their budgetary commitments in next year’s Budget despite the global financial crisis.
Dr Musokotwane said on the Zambia National Broadcasting Corporation (ZNBC) television programme, “National Watch” monitored yesterday that donors contributed 25 per cent of Zambia’s national Budget.
He said that because of the global crisis there were fears that donor countries who were most affected would cut their support but most of them had confirmed their contribution.
“So far most donors have indicated that they will fulfill their pledges and the only worry will be about the job losses in the mines,” he said.
He said Zambia should not be scared to attract foreign investment because it accounted for the positive economic trends in countries such as China and Thailand.
“We should not be scared to attract local and foreign investment but we should just ensure that people benefit,” he said.
He said Zambia had not attracted sufficient foreign investment, especially that it came from a “commandist” economy and that since it had a small market the option was to export in order to earn foreign exchange.
He added that Zambia was not the only country that was facing job losses in the mines and the Government was monitoring mines while looking at measures of protecting jobs.
Dr Musokotwane said President Banda recently visited Luanshya Mine because the Government was concerned about the job losses.
He also assured that next year’s Budget would address how Zambia would pull through out of the global financial crisis.
Times of Zambia
Labels: CEEC, DBZ, DEREGULATION, PSDA, RED TAPE, SITUMBEKO MUSOKOTWANE, YUSUF DODIA
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Dodia asks govt to reduce cost of doing business
Written by Fridah Zinyama
Monday, December 22, 2008 8:48:22 AM
PRIVATE Sector Development Association (PSDA) chairperson Yusuf Dodia has asked the government to find ways of reducing the cost of doing business for Zambia to survive the current economic hurdles.
But finance minister Situmbeko Musokotwane said government is doing everything within its means to reduce the suffering of the people, especially those on the Copperbelt who are likely to suffer from job losses.
Meanwhile, a private sector player Jeremiah Dauya said the government should come up with tax exemptions that will allow local entrepreneurs to engage in productive sectors like manufacturing.
During ZNBC’s National Watch programme yesterday, Dodia said some members of the business community have had to refuse some of the contracts to supply goods as it had become very expensive for them to meet their obligations due to the depreciation of the kwacha.
“Most businesses are finding it difficult to meet their obligations with their clients because of the fluctuating local currency and even when they do fulfil the contracts, they are doing so at no profit at all,” he said.
Dodia further added that the government needed to put in place workable strategies that would help the economy weather the current global economic crisis.
And Dr Musokotwane said Zambia was not the only country experiencing job losses owing to plummeting copper prices, since the neighbouring Democratic Republic of Congo (DRC) was likely to record over 30,000 job cuts in the mining sector.
“The situation could be worse in Zambia but that is not to say that government is not concerned with what is happening in the country,” he said.
When asked on whether the government would further revise the taxes for the workers in order to offset the revenue deficit caused by plummeting copper prices, Dr Musokotwane said he could not comment on such a sensitive topic as the Ministry of Finance was currently working on the 2009 national budget.
And Dauya said a lot of Zambian entrepreneurs had money but were looking for government incentives in order to continue with their ideas.
Labels: PSDA, SITUMBEKO MUSOKOTWANE, YUSUF DODIA
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