Diaspora Matters

On my way from Malawi at Nyamapanda Border, I met 3 white brothers who were coming from Zim. Whilst waiting for my passport to be stamped- the brothers started talking about their journey to Zw and how they were scouring for opportunities……great stuff we need more investors, everyone is free to come and we thank Chinamasa for a job well done in reversing some of the policies which hindered Investment.

Whilst discussing with them, I emphasized that they are probably a bit late! South African investors have been in and out of the country for the past 6-8 years. Analysing political and economic environments with a view to invest in the country. They were waiting for a trigger so as to rush and grab Opportunities ……give them credit for preparedness.

One of the must visit countries in Southern Africa is Lesotho, a great country, lovely people and great tourist sites too. We were in Maseru last month and enjoyed every minute we were there. We look forward to a follow up trip in February 2018. Below we feature opportunities available in the agricultural field.

Overview

Roughly 80% of Lesotho’s population depends on the agricultural sector for their livelihoods. However, agriculture’s contribution to GDP has declined over the last five years. In recent years, the government embarked on a block farming program to increase production through subsidies and central planning. Despite flagging agricultural production, the government plans to continue these subsidy programs to combat hunger and poverty. Although the government has not been actively seeking investors in the agriculture sector, there are opportunities in aquaculture, horticulture, and poultry farming.

Aquaculture

Lesotho has two large reservoirs built under the LHWP, and a third reservoir is planned under Phase II. According to feasibility studies, the water in the existing dams offers near perfect climatic and environmental conditions for trout production. As a result, two trout farms, Katse Fish Farm (KFF) and Highlands Trout (HT), operate at Katse Dam. KFF is licensed to produce 1,200 tons/annum, whereas HT is licensed to produce 2,500 tons/annum. KFF exports primarily to food service outlets in Southern Africa. HT exports primarily to Japan.  There are opportunities to establish additional farms at Mohale dam, and the proposed Polihali dam.

Horticulture

Horticulture is growing in Lesotho, and is getting an increasing focus after the implementation of the World Bank-supported Private Sector Competitiveness (PSC) Project. The project has two sub-components: the production of vegetables and the production of fruit trees, specifically apples and cherries. Two South African companies, Alpha Farms and Denmar estates, have partnered with farmers in Lesotho to produce for the Lesotho, South Africa and EU markets. Due to the country’s elevation, good soil, and abundance of water, the quality of the produce is good, and the fruits ripen earlier than in other countries in the southern hemisphere, offering an opportunity to supply the regional market early in the season. In addition, Lesotho’s climate is good for mushroom farming, and the kind of mushroom produced in Lesotho is in high demand in South Africa, Botswana and other southern African countries. Lesotho currently does not have processing and packing facilities for these products, so another opportunity exists in food processing.

Commercial Poultry Farming

Eggs and chicken are one of the major sources of protein consumed in Lesotho, but the poultry industry is relatively under-developed. Most poultry farmers are subsistence farmers, and their capacity is too low to supply the whole country. There is only one hatchery producing day old chicks and it does not meet market demand; the gap is met by imports from South Africa. There is need to have a fully integrated poultry industry from hatchery to market, including hatcheries, farms and a slaughterhouse. There are opportunities for U.S. companies to establish a fully integrated poultry farming operation in Lesotho or to supply poultry farming equipment such as incubators, chemicals, and slaughterhouse equipment.

Prepared by our U.S. Embassies abroad. 

We were in Malawi over the weekend and enjoyed our stay in the beautiful city of Blantyre. Very clean city, they should consider calling it the Sunshine City. We urge Harare City Councillors to go for a secondment with the City of Blantyre-there is a lot they will learn about city management. The city however need to improve in terms of town planning as the roads are always congested with cars just like most cities across Africa. Electricity shortages seem to be worsening and we hope that a solution to the problem will come in the nearby future.

Buying and Selling Opportunities

We will start with the simple business opportunities, those that do not require a lot of capital nor sophisticated business know-how and that is Buying and Selling or in short-vending! What are Zimbabweans buying from Malawi and selling in Zimbabwe and vice versa?

1.Malawi Rice:

There is no better rice on earth than Kilombero and this is an indisputable fact! Malawi rice tastes good and has a great scent as well. Once you eat Malawi rice then you would not want to eat any other rice. The world famous Kilombero is in huge demand in Zimbabwe and South Africa. This is the number one export from Malawi to Zimbabwe. Every bus travelling from Blantyre to Harare has at least 300 kilograms of the tasty rice. More could be done transport the rice in a better way and even open depots in Zimbabwe and South Africa. We established that some Zimbos are now into contractual arrangements with Malawians whereby rice is send to Zimbabwe to be sold with funds send to Malawi later. There is plenty of room for improvement in this area and innovative and enterprising business people are encouraged to do market studies and researches and study the current business models or practices in the Kilombero rice industry.

2.Chitenje or Afro wear

Extremely cheap in Malawi, those selling it in Blantyre are selling it at $1.25 per metre. At source the price is $0.6 per metre but selling price is $3-$6/m in Zimbabwe. Malawians are not doing enough to market the Chitenjes especially beyond their borders. We hope that our  digital marketing greatly assisted them in thinking beyond their borders. There is unlimited demand for Afro wear across Southern Africa but little is happening in pushing the Chitenjes especially on the digital market platform which is cost effective.

Strategic Investment 

Tourist numbers keep rising and some are getting strategic land on the shores of Lake Malawi. The number of buses plying the Blantyre-Harare route has increased to 3. For a long time only one bus used to ply the route and that is ZUPCO but now the number has increased to 3 and may possibly increase to 4 in 2018. Zimbabweans flocking to Malawi are doing so looking at the donor funded sectors-a lot of consultants are flocking to Malawi. We have met consultants in the engineering, accountancy and many other industries.

So we urge you to take a closer look at Malawi. We have only covered a few areas in this article. Detailed investment opportunities available in Malawi to be distributed to our subscribed members.

Caution

Do not travel to Mozambique or Malawi without a yellow fever book. This is for travelers who have been to countries such as Angola, Zambia or the western world. If you have been to UK, Australia or US, they require you to have this book or you will be faced to part with $15 at every point. Some end up paying up to $75 to corrupt border officials in Mozambique and Malawi.

Our forum adopted Rwanda as one of the countries that we closely follow, the country is one of the leading economic success stories on the continent . On a weekly basis, we feature Rwandese business stories on our Facebook Page for discussion. After the unforgettable experience of the genocide in the 90s, the country has transformed its economy to one of the fastest growing  on the continent. The ease of doing business is second to none. One can open a company in less than 6 hours!

With our ow government i the process of transforming the economy ad coming up with a lea cabinet make up, we decided to feature Rwanda as a benchmark and below we publish the Rwanda cabinet. What is interesting is not only the size of the cabinet but when the cabinet ministers joined office.

We start the week with a new president and hope to end the week with a new cabinet. We look forward to an A-Team that represents the best in talent that Zim possesses. Zim is not short on talent and His Excellency and team will have to cast their net wide and not only think of locals but diasporans too in search of a winning team that inspires confidence in the economy.

Confidence Boost and Parallel Market Rates.
We have already discussed about the need to create an enabling environment for business and job creation. We wrote a letter to the president where ZBIN members expressed their views on issues they would like the new government to tackle. Some of them were included in the inauguration speech by the new leader of the country. We thank our members for speaking their minds. We are doing it for the good of our nation. The best news of the week has to be small improvement in cash availability. Although coming in drips and drops-there are signs of cash is slowly coming back into circulation. Our members have noted hard cash disbursement at Cabs in Karoi where a clients were withdrawing up to US400, in Harare from banks such as Barclays Bank, Steward Bank and POSB amongst others.

All of this change is happening within a week, we applaud the efforts from relevant authorities and hope that the situation will improve significantly in the following weeks. Zimbabweans on the ground are not interested much in fancy policies….we have heard about them over the past decades…we want results. We want to see ATMs starting to dispense cash before christmas, we want to see increased circulation of money. W want to have confidence that if you leave your money in a bank-you can withdraw it any time. We want confidence in the system and the confidence witnessed during the previous week is encouraging. Parallel market rates seem to have plunged with rates of USD to Bond Note falling from a peak of 1.85 to 1.35. We look forward to parallel market rates dropping further and this will depend on the actions of the new administration-for this week, it looks promising, how about next week? Only time will tell….

One Year Anniversary for ZBIN Website.
The greatest news for the forum is that our website turns 1 year this week. A major milestone for the forum as we have provided our members and followers more than 460 free articles on business in Zimbabwe and beyond. We created a National Filing Cabinet of business articles and resources for the SME sector in Zimbabwe. A digital platform that enables people to access useful information on opportunities in Zimbabwe and how to run their businesses. At a clock of a button, one can access information on what is trending in terms of business in Zimbabwe and the region.

We had the Diaspora and remote areas in mind when we set up the website. A person in the diaspora may not be able to access information on business opportunities easily. There is no diaspora friendly digital platform that helps the diaspora community to make informed investment decisions in the country-so we became the forum of choice churning out more than an article per day. We feel humbled to have thousands of regular followers in Australia, Dubai, USA, UK, Canada, South Africa, Namibia, Lesotho and Zambia.

A record 300,000 people have accessed the forum in the past months and this is no mean achievement for a small business site. Whilst initially meant to assist Zimbabweans, we have expanded the focus of the forum and website to include all people across the world. We have covered Trinidad and Tobago, have a solid following in Lesotho, Malawi, Malaysia and India. We have provided a gate way into investment and business into Zimbabwe and Africa as a whole.

We thank everyone for the support especially Farai our Deputy Board Chair, a finance professional based in USA. without him providing financial assistance to keep the website running there would be no website to talk of. This helps to show that the diaspora community is extremely key to the business sector in Zimbabwe. We would like to thank SKT Website design for freely providing website redesign services 4 months after the initial website had been put up.

As we enter year , we look forward to a redesigned website that makes it easy to access, download information and resources and providing a great platform for business discussions. We will also be adding more platforms that will help to showcase investment opportunities in Zimbabwe to all corners of the globe.

What Else….
1.We have not forgotten about the Mozambique trip to Beira, logistics are being put in place for the trip that will happen in December.
2. Festive Holiday Business Preps-We hope to do a Facebook Live Video on key preparations that entrepreneurs need to consider in preparing for the festive season business.

Wishing you a blessed and productive week.

When considering exports its is important to do thorough preparations. You have to know about the demand of your products in the country you intend to export to. You have to know about the general economic conditions and how this affects demand. You have to be aware of the competitors and any developments in terms of the economy such as proposed regulation changes. The bottom line is that you have to be prepared or risk running into problems with goods not sold or sold at uneconomic prices.

To help you reduce the risk of problems on foreign soil, one is advised to do a market research or survey that will assist you in knowing more about the country and market of your targeted exports. To help you in market research, we have put an Export Market Research Guide courtesy of Zimtrade.

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Tomorrow will be a big day for Zimbabwe as we get a new President. We wish the next  president well in his new role as the leader of the beautiful country called Zimbabwe. We watched him yesterday mentioning economic recovery and the creation of jobs. He mentioned Jobs more than twice to emphasize the importance of the matter. We hope to hear about economic recovery and job creation again tomorrow in his official address to the world as Zimbabwe’s newest leader.

The Zimbabwe Business Ideas and Network, ZBIN has been at the forefront of promotion of small to medium scale businesses since 2015 and we have a solid forum with more than 32,000 members who are networked in respect of access to opportunities information, access to finance and markets and capacity building.

We hope to see an improved environment for small businesses and an acknowledgement of the sector is the creator of most jobs in the country. The previous administration did well to help the sector with a number of policies and availing funds to the sector but there is little on the ground to show improvement. We hope to see a radical shift in policies which will create an enabling environment for the small to medium scale to thrive.

Funds But No Markets

The previous administration availed funds for the SME sector-more than 100 million dollars earmarked for Cross Borders, Women, Miners and Horticulture. They simply put money into banks and folded their hands! A number of launches to sensitize members of the public on the availability of funds and that was it. They expected members of the public to access the funds, use them as per business plans and help the economy.

This was an outdated approach as it did not cover capacity building in helping people to come up with solid business plans, helping them to have access to markets and managing their businesses. Providing funds without awareness on access to markets is not effective! Access to markets is a huge challenge that needs to be addressed in the small to medium scale business-if no follow up action is done to assist the sector with access to markets then expect no meaningful progress to happen. We can draw you to the success of the Command Agriculture-there was a ready market of maize in the form of the Grain Marketing Board. It may not be the same when it comes to funds such as the Cross Border Homelink Facility.

We therefore hope to see more funds being availed to the sector but we hope to witness an improvement with funds being availed as a comprehensive package that includes access to markets, export promotion and capacity building. This will ensure sustainability of the sector which dominates the economy in the country.

Diaspora Meeting Follow Up

The forum followed the Diaspora Investment meeting that you attended in South Africa a few months ago together with 3 other ministers. We hope to see follow ups in engaging the diaspora so that they can meaningfully participate in the economy. Some have the resources and are willing to meaningfully participate in the economy-we hope to see a follow up of the discussions held in Sandton, South Africa.

Members Input

We reached out to our members and below we feature their input which is unedited.

51 percent. No one in their sound mind would like that.Too many police road blocks need to be reduced.
China should not bring manual labourers we have plenty of that. Government to invest online services to pay services so that there is no one to pay the bribe. Ensuring that ALL people benefit not only from one party or region

No foreign investor should ever own more than 49% of land in Zim and should always need to have a local person involved in all the dealings…and also the issue of bringing own labour should be minimised…Just try to put the locals first. Try to copy places like Dubai on how they run things.

They should start by making sure all banks are functioning well….not what they are doing….who wants to invest in such an economy where there is no circulation of currency.let it be the starting point.

And before we respect investors lets respect each other 1st lets love to see each other succeed..we as Zimbabweans have a tendency of wanting to respect the foreign investor yet we make things hard for our fellow local brothers…mostly we tend to ask for a brother to bribe yet some foreign investor comes you just process everything willingly and without bribe….lets put each other’s success first.

We need to do away with the indeginisation law in its current format.I think the local ownership threashold should be scrapped except for in agriculture so as not to reverse the gains of land reform.However in capital intensive sectors like industry investors should indeginise through a fair taxation regime. For mining, CSOS must continue but with greater monitoring on the implementation and tangible community benefits. 

Capital will only go where it will get a decent return and there is rule of law and protection of property rights.So if ED is serious he must attend to these obvious shortcomings that exist in Zim and we will see investors return to Zim

All Zimbabwe wants now is to restore investor cornfidence.companies will open and create jobs.1)we have in place an indigenous policy that takes 51% ownership from foreign investors.abolish that.(2)Agriculture.create an environment whereby we accomodate varidzi vefarming.that can be achieved by swallowing our pride and admit failure on our part.learn to coexist with them and maybe learn how its done.that can only be achieved by not necessarily reverse the land reform but by working together as a pple.u also cant achieve that if Sable chemicals is not functioning at 100%.(3)Mining.backbone of the economy alongside farming.transparency is all thats needed in that line of the economy.relax the crazy policies in place and Anglo America and Rio Tinto as well as all other mining giants will surely come back.(4)Finance.cash should be easily accessible any given tym.(5)Welfare.government must play its part on the welfare of its people.hospitals should function full throttle.medicine should be found in hospitals in abundance.(5)National healing.we all know the hatred sown on Zimbabwean populace against each other,tribe.political rivalry and a polluted political environment.we can go on and on but the bottom line is the government leadership in place just has to do just about the opposite of Bob’s way of doing things.the opposite of his policies.engage the int community.but that can only be achieved by admitting failure.

Let’s revisit what Mdala asked. Job creation. Job creation .job creation. How is the new broom going to create that. My thinking is ED is going to revisit all investment policies that hinder investor confidence. Also how much has the local investor done on the job creation .its only Masiyiwa who has done well with his Econet.liquid telecoms. Steward bank and recently Kwese TV.

This is a good news especially to us business people. If people are employed it means an increase in the the demand for goods and services. However I also have a feeling that politicians know what people want but they are trapped into populist behavior. Today he is talking about creation of jobs last time Maziwisa was saying we created more than the 2.2m targeted jobs. So we must be able to survive under either situation. If jobs are created let’s take the opportunity to grow our businesses. If there are no jobs let’s look into ways of survival under such situations.

We congratulate Zimbabweans for the historic events that took place yesterday. We look forward to better times ahead especially with  new government expected to be in place in the next few weeks. The economy of the country had obviously deteriorated as from 2013 and this is one of the key issues that needs to be addressed. The President elect today mentioned his resolve to tackle economic recovery and we look forward to Zimbabweans from all walks of life working together in order to resuscitate the economy.

What happens during economic recovery?

We witnessed this during the Government of National Unity ,GNU era-when the economy started picking up, so did an interest in leisure and entertainment activities. The increase in disposable income led to an increase in visits to local and international holiday spots. In Harare a number of entertainment joints which had been closed during the hyper inflation era reopened, new entertainment places also opened.

So to investors interested in this sector our advice is simple- participate and closely monitor improvements in disposable incomes. As the economy rebounds, so will be disposable incomes resulting in increased demand for leisure and entertainment opportunities. You may also need to monitor the statistics on the number of international tourist arrivals in the country as they also create a demand for the sector.

So which small businesses have been thriving this year? We have covered several businesses and two weeks ago we started the process of shortlisting the top businesses that did well in Zimbabwe in 2017. Our first shortlist was the ordinary Maputi Gun simple machine which performed beyond expectations especially on foreign soil. Today we cover another top business that performed extremely well in the country and it is the printing business. Those who had invested in the printing business did not complain of low business.

Printing machines for books, pamphlets, roll up banners and  tshirts. Those into this kind of business have not complained of low business. Those targeting the high end have been expanding business with one well known company opening a new branch at Borrowdale Village Walk.

The Zimbabwe Business Ideas and Network forum is fortunate to have a number of qualified accountants at board level, the secretariat as well as volunteers. Our board of 10 has 3 qualified accountants. Farai, CPA,CGMA; Tavaziva, CA and Victor ACMA,CGMA.

We also tap into a lot of accounting expertise from more than 10 qualified accountants who are volunteers of the forum. Below we share with you information on Global Management Accounting Principles. The information is helpful to accountants particularly those in management accounting or financial analysis. It also helps those that do not have a financial background.

The accounting field is fast changing and it isno longer about preparing historical financial information for reporting. The accounting field is now about value addition to a business and the principles below help in solidifying the place of management accountants on corporate boards.

Quality decision making has never been more important – or more difficult. Innovations and innovators daily disrupt the status quo. The volume and velocity of unstructured data is increasing complexity.

The Global Management Accounting Principles© were created for this era of business. They reflect the perspective of CEOs, CFOs, academics, regulators, government bodies and other professionals in 20 countries across five continents. This included a 90-day public consultation in which more than 400 people participated. Public as well as private sector representation has been included so that the Principles have universal applicability.

The purpose of the Principles

The purpose of the Principles is to improve decision-making in organisations through the provision of high quality management information. They further support you in benchmarking your organisation against best practice.

The four principles are

• Influence
• Relevance
• Analyse
• Trust

Influence

Communication provides insight that is influential

OBJECTIVE:  Drive better decisions about strategy and its execution at all levels.

This principle is driven by insight, information and integration. Robust, valuable business is built on good decisions. However, a good decision means nothing when it’s made at the wrong time. Given the pace of global business, timely decision-making is more crucial than ever.

By putting communication at the heart of your business, the Global Management Accounting Principles give your business the tools to identify problem areas and cut through siloes. Forging close relationships with key decision-makers enables management accountants to source and analyse the right information, to define a watertight business strategy.

Key benefits

• Clearer strategy: By opening up the right channels of communication, application of this principle empowers decision-makers, by providing them with the heavily scrutinised, evidence-based information they need to steer progressive strategy.
• Tailored communication: Simply put, it’s what people need, when they need it. Defined by transparency and delivered with clarity, this principle helps to achieve long-term impact by providing credible, timely information.
• Better decisions: Understanding the intricacies of the business enables management accounting to make the most well-informed recommendations to key decision-makers, and the robust decisions that follow them.

Relevance

Information is relevant

OBJECTIVE:  Help organisations plan for and source the information needed for creating strategy and tactics for execution.

This principle distills data to inform and deliver sustainable business strategy. In the age of data-driven business, it can be difficult to know which information – past, present and future – is relevant to making key decisions.

Having understood the decision-maker’s needs in the communication principle, this principle provides the information needed to fulfill them. How? By identifying, scrutinising and collating diverse data about the business.

To paint a holistic picture, management accounting looks at internal and external, financial and pre-financial information. By looking at past, present and future data, plus mistakes and successes, this principle facilitates the delivery of decision-relevant information only, to drive value.

Key benefits

• Separate good from bad: Bad information leads to bad decisions. By applying this principle, management accounting finds the right information for the decision, and decision-makers, involved.
• Quality meets accuracy: Prior to analysis, management accounting sorts and filters data, so only the most valuable, consistent and accurate information is presented to key decision-makers.
• Information agnostic: With so many factors in driving global business, management accounting recognises that good information, both qualitative and quantitative, can come from anywhere. This principle’s holistic approach means optimised relevance to drive optimised value.

Analyse

Impact on value is analysed

OBJECTIVE:  Simulate different scenarios to demonstrate the cause-and-effect relationship between inputs and outcomes.

This principle optimises the link between management accounting and the business model. Without proper attention to this interaction, management accounting’s ability to have any lasting effect on value – and value generation – is severely compromised.

Having sourced and defined the right information for the task and decision at hand, this principle develops scenarios to test that information against. By understanding the business model and wider factors in more depth, management accounting can fully assess the breadth of opportunities, risks, costs, and the potential for generating long-term, robust value for the business.

Key benefits

• Better-informed decisions: By taking a holistic view of the decision-making situation, then rigorously testing diverse factors with scenario analysis, this Principle can assess the relevance and resilience of the business model.
• Prioritised action: Prior to analysis, management accounting sorts and filters data, so only the most valuable, consistent and accurate information is presented to key decision-makers.

Trust

Stewardship builds trust

OBJECTIVE:  Actively manage relationships and resources so that the financial and non-financial assets, reputation and value of the organisation are protected.

This principle has empowerment, good values and best practice at its core. An organisation is only as good as its people: without integrity and objectivity in management accounting, the whole decision-making process is undermined, which has negative consequences for the business and its long-term value.

Management accounting professionals champion solid, open working relationships, and applying the principles to their practice areas with competence and clarity. It means they become trusted guardians of an organisation’s value – and values. It also means they’re always ethical, accountable and mindful of these values in every aspect of their practice.

Key benefits

• Accountability meets credibility: Being accountable for decisions minimises the risk of a poor decision, and its potential long-term effects. Creating and maintaining open, two-way communication means stakeholders’ needs are met with credibility, with a positive impact on processes.
• Sustainability: Management accounting makes the link between sustainability, strategy and the business model, taking economic, environmental and social risks into account to drive sustainable, long-term success.
• Integrity meets ethics: Management accounting adheres to its strict code of conduct with commitment, objectivity and integrity, so the decision-making process can be approached critically, and value can be maximised.