Moving Zimbabwe forwards despite the politics: If we are to see sustainable development of the Zimbabwean economy, we need to strengthen the generation of income and wealth within the second economy
I have had some rather remarkable responses to my last article dealing with my perspective on developments in the Zimbabwean economy. Some doubted that an economic solution can be found in Zimbabwe despite the politics, while others, dealt with the semantics around the term "second economy" and why it exists. For me the latter issue is really much of a muchness as we humans tend to choose what we want to see and at times, ignore or miss out on obvious opportunity because of how we label things. I guess that for me, the opportunity lies in that very fact that, others don't, or choose not, to see it. But I digress.
In November 2011 on this column, I wrote an article headed: "Black on Black Empowerment". In this article, I proposed that Africans, in general, have failed to harness their formidable spending power to direct economic change and empower their own communities. They have failed to manufacture their own goods and services but, have rather chosen to hand over their consumption power and purses to the benefit of conglomerates and capitalists. As a result, communities remain underdeveloped and dependent on consuming imported products and services that only benefit companies owned by capitalist elite, that counts in the minority. The result of this is that, income disparities between the rich and the poor continue to increase despite promises of economic empowerment. This has been one of the major sources of the recent revolutions thought-out the continent. We therefore need to think anew and realise that, per Albert Einstein, the problems we are faced with can never be solved at the same level of thinking as we were when we created them.
Capitalism has created wide spread poverty and I still insist that Africa must find its own economic models that serve the interest of the majority. I therefore agree fully with Mugabe's recent statement at the African Union's 19th ordinary session in Addis Ababa, where he said that, Africans must find African solutions to African problems. I shall deal with this very important subject thoroughly in the future.
I still hold these my views on the issue of "black on black empowerment", which I think are also clearly articulated by Dr Chika Onyeani, in his book titled: "Capitalist Nigger: The Road to Success, a Spider-Web Doctrine" where he says that, "We have become a sheep-like consumer race that depends on other communities for our culture, language, feeding, and clothing. We've become economic slaves in Western society".
In Zimbabwe, this still remains the case in what I described as the "first economy" in my last article. In the second economy, however, the penny seems to have dropped. We are beginning to see self reliance and the increased circulation of income within that sector of the economy. One only has to visit Mbare Musika, the Complex in Glen View, or Machipisa, in Highfileds or Makoni in Chitungwiza to realise that there is now significant economic activity within this second economy. Unfortunately, most of the products exchanged in this economy are imported. This means that, we will need to undertake the next phase of development which is: the local manufacture of goods and the localisation of service provision so that we create a virtuous cycle of wealth generation within these communities.
My argument here is that, if we are to see sustainable development of the Zimbabwean economy, we need to strengthen the generation of income and wealth in this economy where the majority reside. In order to achieve that, it is necessary for us to come up with innovative ways that result in sustainable self financing of development. It appears to me that in Zimbabwe, the old mentalities that: "get educated and get employed" is now over. The new mantra is now "get educated and work for yourself". The wage mentality has disappeared. I therefore doubt very much that those entrepreneurs you find in our second economy will be rushing to get employed when the economy opens because they are making a fortune. We therefore need an economic rehabilitation policy that focuses to developing township economies.
For me, the solution is quite simple: - Zimbabwean township communities in partnership with members of their families in the Diaspora, must harness their collective spending power and savings and deploy these in the development of their neighbourhoods. In my opinion, this does not require any indigenisation law or politician, nor does it require any thing further other than our communities deciding to act differently with their purses and organising themselves so that they may take advantage of their large numbers.
I have always argued that, Africans are wealthy but only as a collective. Insurance companies, banks, supermarkets and cell phone companies rely on our large numbers to generate profits that only a few share. These profits hardly find their way back to where they live. Insurance companies invest on the stock exchange and develop properties in the first economy. Our banks lend primarily to the first economy and create barriers for access to capital for second economy residents through their lending criteria. Supermarkets sell their products profitably in the second economy but hardly plough them back. The first economy sucks the blood of the second economy and our communities remain consumers who live in terrible conditions die poor. All you have to do is visit the areas I mentioned above and see the amount of waste piling up, the dilapidating buildings and poor infrastructure left me angry because right next to them are these retail supermarket chains, banks and cell phone companies with smart buildings making a killing. That is about to change.
My idea is that: All we need to do is to utilise exactly the same model they use, but use it to the full benefit of our communities.
I believe in Zimbabwe, there is a real opportunity now, to establish a new breed of locally based and socially responsible platforms that empower communities and improve the quality of their lifestyle. I am encouraging Zimbabweans in the Diaspora to invest their remittances in local community projects and create jobs and long term wealth for themselves and the country. I am sure it is obvious to most that, it is better to send money home for investment than to continue sending groceries. As mentioned in my last article, there are opportunities in small scale agriculture, manufacturing, retail, energy, waste management, information communication technology, education and training and a myriad of other services that a community needs on daily basis.
In Highfields,a Harare township where I grew up, for example, we are doing just that. We are in the process of establishing an empowerment trust owned by residents. That trust will have a controlling stake in the Highfield Development Corporation. In the company, we are combining our skills, our purses, our demand for products and services, Diaspora remittances and micro finance to begin to create the virtuous cycle of wealth that I talk about.
We will then partner and only spend our incomes with those companies and organisations that demonstrate our values of community development and empowerment. We will also establish our own companies over time owned by our community members and to the economic benefit of our people. I think that the Jewish folk are gifted and smart and we Africans ought to be like them if we are to progress. I always use the example that one dollar circulates in the Jewish community a thousand times and ends up in a bank that they own. While for us Africans, when we make money or get paid, our first dollar goes out of our community. No wonder why we have remained poor!
These are exciting times and I believe our community projects will not only feed families, raise healthy children, and educate them so that they may achieve their hopes and aspirations but can result in the economic development of Zimbabwe despite the politics.
Lest you doubt, I am not naïve to the challenges we may face as we must change paradigms and challenge vested interests. We will also have to confront the principalities of darkness, poverty and greed that have overcome our country. We must however, remain unshaken and focused on doing what is right for a change.
There is much to be done.
Vince Musewe is an independent economist and founder and CEO of the Highfield Development Corporation in Harare. You may contact him and request further information on [email protected]..
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