Friday, February 26, 2010

(HERALD) CEOs’ Roundtable: Taking active role in economic turnaround

CEOs’ Roundtable: Taking active role in economic turnaround
By Golden Sibanda

THE Chief Executives’ Roundtable 2010 conference, which had an impressive turnout, has come and gone, but the forum served its purpose as it got Zimbabweans thinking about their individual and collective roles in turning around the country’s economic fortunes.

Delegates at the event were so engrossed in the proceedings at the conference such that each time a presenter stopped talking there was chilling silence that one could hear a pin drop and that explains how much people did not want to miss even a bit of the presentations.

Expectations were always going to be high that a business-networking event of that magnitude would produce pointers on the route the economic reconstruction efforts should take, and with active participation of Government and the private sector. The event ran under the theme "Towards Double-Digit Growth, Transformational Leadership, and Growth Strategies for Companies".

Vice President Joice Mujuru, Deputy Prime Minister Arthur Mutambara and Minister of Economic Planning and Investment Promotion Elton Mangoma also attended the event.

The guest of honour was Dr Linda Yi-chuang Yueh, the China Growth Centre director based at the Oxford University and also a visiting professor at the London Business School.

Dr Yueh is a member of the "Business Thinkers 50" and she is regarded as one of the most knowledgeable economic experts of this era across the world.

It is instructive to note that most, if not all, presenters at this year’s edition of the CEOs’ Roundtable pointed out the fact that effective solutions to solving the country’s decade-long economic puzzle should be those that are developed by locals.

Vice President Mujuru aptly summed this view when she said: "We need to look inside ourselves for solutions to our problems."

Many a time developing countries have turned to Western countries and multilateral institutions such as the International Monetary Fund for advice on how to deal with their economic problems. Some such external prescriptions, in many instances, have had disastrous effects on the recipient countries, as the proposed solutions did not recognise the peculiar circumstances of these countries.

The call for largely domestic solutions to the country’s economic problems was also echoed by Minister Mangoma and Afrosoft chief executive Engineer John Mberi. Delegates were also unanimous that the growth of an economy was not automatic, but a considered decision that the country needed to take to achieve the objective.

"We need to move from prediction of growth to creators of growth, a decision we make," said Deputy Prime Minister Mutambara.

Minister Mangoma concurred, saying: "Growth is a mindset, a decision we make to grow with jobs, indigenisation, freedom and democracy."

KM Financial Solutions (organisers of the event) chief executive Mr Kennias Mafukidze noted this requirement when he said: "Growth is a decision that has to be made, it does not just happen."

There were also important lessons from China.

"Crises must never go to waste, but (a nation) must learn from them," said Dr Yueh.

She said China’s double-digit economic growth of the last 30 years was a result of a conscious decision to open up the economy in 1979. China encouraged joint ventures with local firms for technology transfer and investment approval was given mostly to foreign companies that had a reputable history in their areas of specialisation.

It also emerged that despite China not having clearcut legal and institutional structures, its respect for the interests of foreign investors and property rights were key to attracting external capital.

A major highlight of Dr Yueh’s speech was her point that no country can successfully industrialise without first developing its agriculture.

It was also clear that Government must play an active role in capacitating rural farmers so they can produce more. In addition, just like China, Zimbabwe needed to emphasise on joint ventures to encourage technological and skills transfer.

The meeting also noted that hyperinflationary conditions had been wiped off with the adoption of the multicurrency system, creating a favourable platform for sustainable growth.

At a time Government is short on financial resources, delegates at the conference rightly noted that the private sector must be the engine for the ongoing economic recovery efforts.

The operational environment had improved, creating conditions for businesses to grow.

The conference heard that opportunities were abundant to pursue public-private partnerships, an avenue that had not been explored for a long time. Some investors have been sceptical about taking huge investment decisions, citing political uncertainty yet this is the time to invest considering the many opportunities and low investment costs.

Vice President Mujuru concurred that Zimbabwe required visionary leadership for inspiration and bold risk takers to take the nation forward.

From the diverse contributions made at the conference, it became clear that there is need for Zimbabwe as a country to remain in dialogue on the way forward so that it does not lose direction.

KMFS noted this from the outset, pointing out that Zimbabwe’s economy stabilised and started to stagger towards growth only when its leadership began to read from the same script. The economy was projected to grow by about 4,7 percent last year and by at least 7 percent this year.

However, the conference noted that the country had the natural and human resources to surpass the growth projections for this year.

This view stems from realisation that China’s success story of the last three decades was enabled by the fact that it was coming from a low base and opportunities for growth were unlimited.

China managed double-digit economic growth rates over the last three decades, but this did not mean the process was without challenges.

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