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Umzingwane District
Andrew Sibanda
15 APRIL 2013
VENUE: BRED OFFICES
DEPIZ
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Presentation Outline1. Introduction
2. Background of economic empowerment initiatives inZimbabwe
3. Formulation of the policy and legal framework of
indigenisation and economic empowerment
4. Policy implementation
5. Empowerment experiences : What has not worked
6. Focus on Matebeleland and Midlands Provinces
7. Recommendations: Making Empowerment a Reality8. Implementation processes
9. Key Conclusions
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Introduction
The Baptist Rural Economic Development Trustcommissioned a study to assess viable business
opportunities in it operational areas of
Umzingwane district namely Mawabeni,Matshetshe, Mtshede, and Esikhoveni. The
study was commissioned for the purpose of
providing vital information on the organisations
enterprise development program
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Objectives of the Study
1.Purpose of the Study
The purpose of the study is to identify and analyse
viable business opportunities around Mawabeni,
Matshetshe, Mtshede, and Esikhoveni areas in orderto advise trainee entrepreneurs on which
opportunities offer the best chances for establishing a
successful enterprise.
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Objectives of the Study
2. Specific Objectives
1. To Identify viable business opportunities in
Mawabeni, Matshetshe, Mtshede, and Esikhoveni.
2. BRED will soon be opening a youth Development
centre at Mawabeni Baptist Church offering various
business services. They consultant should identifybeneficial synergies and opportunities which will
maximize the viability and self sustainancy of this
centre.
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Program BackgroundTraining Centre /Company Training program Number of trainees
Male Female Total
School of Hospitality and
Tourism
Hotel and catering 1 9 10
Westgate VTC Motor Mechanics 6 0 6
Fingers, Chanes &
Stalicholiuos Hair Salons
Hair dressing 0 4 4
Bulawayo Polytechnic Building 2 0 2
Providence Film and Sound Sound engineering 2 0 2
Community development
Metro College
Community development 0 1 1
Bulawayo Polytechnic Fabric design 0 1 1
TM Hyper Till Operation 0 1 1
Bulawayo Polytechnic Computer technology 3 0 2
Total 30
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MethodsandTechniqu
es
(i) Literature review
(i) Design of data collection tools
(ii) Enumerator training
(iii) Mobilisation of participants
(iv) Focus Group Discussions
(v) Key informant interviews
(vi) Assessment of existing business
(vii) Data analysis and report writing
(viii) Analytical frameworks
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F
ormulationofEmp
owermen
tLaws
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TheI&EE
ACT:14:3
3:KeyFeatures
Outlines the objectives of broad based
economic empowerment
Provides the institutional framework for
indigenisation and EE
Provides legal instruments for I&EE (General
regulations (2010) and general notices)
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R
eactionstopolicyimplementation
There is consensus on need for policy, but differences
on strategy, pace and focus
Implementation continues despite discord &disagreement in Incl. Gvt PLC issued an adverse
report on Gen. regulations & gen. notice 114/2011
-Thus widely viewed as partisan & driven by politicalexpediency instead of economic considerations.
Implementation viewed as narrowly focused on
indigenisation than empowerment, with little strategicefforts towards ensuring BBEE
Urgent requirement for compliance & application of
strong arm tactics strengthen the political expediency
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Policy Implementation: Achievements
100% Compliance by companies mainly in the mining
industry.
Establishment of community share ownership
schemes in areas where mining companies operatetotal capital of US$114 million injected.
Establishment of employee share ownership
schemes: 400 ESOTs created by November 2012.
Establishment of the youth fund - US$10 million
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Im
plementa
tion:Whathasnot
worked Slow down in new foreign direct investments
Slow down in Investment inflows
Flight of capital
Increasing difficulties in raising funding forcritical projects
Challenges of mobilisation of financialresources
Violation of BIPPAs Save Valley Conservancy
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FocusonMatebelelanda
ndMidlands
Provinces Problem underpinning empowerment
Implementation I & EE seems uniform nationwide e.g.
CSOTs, ESOTs, though the Youth Fund is seen as
generally unreachable.
BUT: There an enduring perception that Matland and
Midlands are marginalized.
Perceptions of regional Economic status- Marginalisation
- Lack of initiative by people in Matebeleland
- Poor representation by elected leaderships
- Failure to take advantage of available resources
- Reality : economic stagnation in the regions. This may
be a result of a combination of factors than the result
of any one .
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Em
powerm
entinitiativesinMatland
(1)DIMAF - 80% of the US$40 million fund
was allocated to about 17 companies inthe region
(2)Land allocations under the land reformprogram
(3)A number of small projects fundedunder the youth fund
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Em
powerm
entinitiativesinMatland
Empowerment ChampionsCivil Society organisations(1)Jairos Jiri Association
(2) Binga Craft Centre(3) ORAP
(4)Amakhosi Theatre
(5)Churches -
IndividualPeoplesNotableEfforts
(1)Delma Lupepe Industry and Commerce
(2)Peter Ndlovu Soccer and talent development
(3) Raj Modi Commerce(4)Brenner Bulawayo Abattoirs
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ProposedB
BEEModel
No Need for Unique Policy:There is no need for a separate policy
framework or different empowerment
approach, but, existing policy should be
localised, fairly implemented, giving equal
importance to ALL regions.
Key Elements of the BBEE Model
(i) Access to Information: Information is power.
(ii)Inclusion and Participation(iii)Accountability
(iv)Local Organizational Capacity
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Proposed Broad Based Economic Empowerment Model
BBE Empowerment outcomesIncreased assets andfreedom of choice
Strengthened poor peoples
organizations
Improved governance and
access to justice
Functioning and more inclusive
basic services
More equitable access to
markets and business services
Strengthened civil society
Improved participation in
national issues
Reform of State Institutions Local and National Poor People and their
Institutions
Sector Rules
and
processes
Norms
And
behaviours
Transparent Indigenisation
ProcessesPrivatisation
CSOT
ESOT
NIEEF
Preferential procurement
% local ownership (51%)?
Guiding Principles
Information
Inclusion/participation
Accountability
Local organizational capacity
Sector Specific Empowerment
Processes
Individual & Collective
Supportive National context (political, social economic andlegal)
Control
Participati
onAccess
Awareness
Welfare
E
mpowermentlevel
Medium to Long-
term
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Priorityse
ctorsfor
BBEEtarg
eting
(i) Land ownership and control: address leases and title deeds
include communal lands and protected lands - national parks.
(ii) Agriculture: generally focus on improving infrastructure,
farming machinery & equipment, production technologies
including seed technologies, agricultural training, and market
development- Livestock commercialization,
- Cropping: irrigation development.
(iii) Tourism and hospitality sector: focus on giving communities
and businesses access to the resources to run the tourism in
the forest areas and national parks. Develop local Tourism.
( ) d l b d
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Prioritysectorsfor
BBEEtarg
eting
(iv) Arts entertainment and culture based enterprises:
develop the arts to professional level, with deliberate
promotion of the various types of art including theatre,
visual arts, music, film production, crafts, and relatedcultural aspects.
(v) Vocational Training, skills development, leadership
and entrepreneurship: providing accessible, postsecondary vocational training and education.
(vi) SME/SMMEs: Address key challenges facing
SMEs/SMMEs e.g. poor access to finance, weakbusiness structures & systems, marketing constraints,
poor capacity for R&D, poorly defined regulatory
frameworks networks
( ii) Mi i F ll di l i i i
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Pr
ioritysec
torsfor
BBEEtar
geting
(vii) Mining: Focus on small to medium scale mining operations
addressing Skills training, Acquisition of equipment,
Strengthening small miners institutions for better collaboration,
Establishment of strategic mentoring relationships with large
scale mining concerns
(viii) Construction and related industries: Focus on
manufacturing of building materials such as bricks offers
important services. There is a huge market for constructionservices especially due to the shortage of housing in urban areas
as well as peri-urban areas
(ix) Banking and financial services: Improved access to financial
services
(x) ICTs: improve access and affordability , Improvement of TV
and radio coverage:
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1. Broadly define empowerment to enable policy to be
inclusive, & define the term as a goal, & as a process,
stating SMART objectives, indicators & measurement
criteria.
2. Empowerment to mainly based on increasing
participation through economic expansion, productive
engagement to create more wealth for povertyeradication, rather than redistributing the existing
limited wealth.
3. Emphasise development of a broad-based domestic pvt
sector through innovative transformation of existing
opportunities into enterprises to become the engine of
growth & source of national pride PolicyRecommendations
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3. Government should focus on developing the policy andlegal framework, guidelines and standards, that guarantee
pre-conditions necessary for successful economic
empowerment & allow ALL Zimbabweans to participate in
the economic development of their country and earnthemselves self-respect and dignity
4. The percentage of local shareholding (the 51%) should be
the ultimate goal to be achieved in the medium to longterm (e.g. 30 years) with options for lower local
shareholding levels in the short to medium term
5. Empowerment policy to deliberately include instruments
that allow for decentralisation of empowerment activities
to relevant sectors and allow significant private sector
involvement in the design of sector strategies and targets
that allow for sustainable growth and higher success rates
Policy
Recommendations
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1. Institutional changes to include private sector players in the form of
representative bodies. Govt then becomes policy maker and
supervisor rather than sole implementer
2. Government, private sector players and civic society shoulddevelop sector specific strategies to be implemented by private
sector players on the basis of economic criteria through
consultative processes
3. Pace of empowerment to be based on the performance of theeconomy i.e. context specific rather than based on political
considerations only. The current economic context seeks to attract
foreign direct investment, therefore, empowerment considerations
should not be seen as obstacles, but stepping stones that investors
should seek to adopt. Creative incentives for indigenisation shouldbe used,
Strateg
yRecom
mendat
ions
(4)Ci i i t ff t t b h ll d t d hi i l li
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(4)Civic society efforts to be channelled towards achieving clear policygoals set by government and provide information on common
indicators by sector
(5) For empowerment to be successful, there is a need to provide
government backed financial instruments with appropriate pay back
periods, reasonable interest rate regimes and rules of access
(requirements, e.g. collateral security).
(6) Capacity building of entrepreneurs should form the basis of all
empowerment initiatives. There is a need to avoid the culture ofgrabbing as a strategy of indigenisation and empowerment. This
approach violates international statutes and key principles of
sustainable growth, while at the same time giving perceptions of
repulsive lawlessness.
(7) preferential procurement should be broad based through making
sure that the government tender system adopts a geographic area
specificity and use the point scoring system in order to ensure
equitable distribution of opportunities across regionsStrategyRecom
mendations
(8) t d t t ifi
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(8) create mandatory sector specific company
grading and performance systems as well as
systems for objective measurement of
performance for those companies that have adesire to participate in indigenisation and
empowerment programs. These should then be
used in the awarding of work to appropriate
companies that have the required capacity,equipment, and experience to deliver to required
standards.
(9)
StrategyRecom
mendat
ions
(i) Identify and characterise the causes of disempowerment
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(i) Identify and characterise the causes of disempowerment
or vulnerability of different population groups in their
locations
(ii) Conduct a capacity audit by sector, and define theexisting capacities, identify capacity gaps both at
corporate, community and institutional levels
(iii)Develop an a result oriented empowerment programthrough inclusiveness democratic processes of
participation. The program should define SMART sector
specific objectives and strategies based on sector
approach with sensitivity to regional variations. Short,
medium and long term results should be defined in their
result chains at output, outcome and impact levels.
(iv)Identify and select performance indicators (at output,
outcome, and impact levels) against which
Implem
entationproc
ess
R th th idi th h l
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Rather than providing answers, the paper helps
crystallise to key questions on the empowerment
agenda e.g.
- How can there be better local ownership of
national policy on indigenisation and economic
empowerment agenda and process?
- How can the empowerment agenda be bettercommunicated and used for the benefit of all?
- What are the different tools available for policy
localisation, and what are implications for current
practice.-What should be the roles of government, local
government, civil society and the private sector. Con
clusions
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Finally, while there is value and clear
benefits in localising national policy, it isimportant to note that, on its own
localisation is not a panacea to economic
empowerment. There are a number of
factors that determine the successful
implementation of localised policy. Policy
localisation therefore, is not an end in itself,
but, the beginning of work processes thatmust lead to real broad based economic
empowerment
CONCLU
SION
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SIYABONGA
HA
NK
YOU!