I have in my inbox an inquiry from a ZBIN member who is based in Australia. He is looking for partners with established businesses in Zimbabwe. He would like to know about the nature of the business, profitability and proposed ownership structure.
Response to him
One of the reasons why we established this group is to unlock business opportunities that exist the Diaspora and Locals. ZBIN realised that a lot of our brothers and sisters in foreign land are still interested in Zimbabwe and the majority of them would like to invest back home. What is currently is an institute that spearheads investment in Zimbabwe by the Diaspora.
Notable investment institutes that exist include the Zimbabwe Investment Authority, however this looks mainly looks at high value Direct Foreign Investment and does not specifically target the Diaspora. We also have another institute specifically set tap into the Diaspora Community, Homelink, however there is little action from an institute with the potential to facilitate direct investment of more than USD100m per year from the Diaspora.
So in the absence of no one taking the Diaspora Community seriously in terms of investment, in came Zimbabwe Business Ideas and Network. We have seen the potential and are going to showcase to relevant authorities and especially governments in Southern Africa that its possible to bring development through Diaspora engagement. We are going to showcase that its possible to bring immense benefits to home countries through engagement and partnerships between the Diaspora and Locals.
ZBIN Strategy
Connecting the Diaspora and locals is not an easy process. Connecting people who do not know each other and involve huge sums of money is risky business, extremely risky. Chances that someone can just disappear with investors’ money are extremely high. We have seen in the past what happened to institutions such as ENG and other financial institutions in the past, we have seen a lot of Diasporans being duped by relatives back home when building homes in Zimbabwe. We need not remind you of the recent collapse of MMM do we? There are a lot of dishonest people and schemes around and ZBIN has covered some of them in recent times.
Trust
We essentially have a problem of trust when we talk of relations between the Diaspora and locals. With trust issues come RISK and therefore we have started the following processes:
- Registration of ZBIN members with businesses back home, putting them into our database
- Ensuring that our members formalise their businesses
- Enabling members to enjoy economies of scale through working as a group
- Access to markets by members
- Access to finance from local financial institutions
I will explain more in future about the strategies we are implementing for the group to ensure that members have formally registered businesses that can show potential before we encourage the Diaspora to invest. As a group we are going to have vetting and follow up mechanisms so as to reduce risk.
One needs to already have a business running, complying with all local legal and operational laws. You need to show that you have accessed loans from local financial institutions and handled them well. You need to show that you have a market for your business; you need to show the profitability of your business.
Conclusion
A lot of our members continue to inquire about investment like the brother from Australia, we do have various inquiries from USA, New Zealand and UK but we are encouraging members to hold on for a while whilst we put formal mechanisms in place. We are going to have test runs where locals partner amongst themselves and produce good results. The key word here is PROOF, locals should show that you are organised, you are ethical, you must be successful in a difficult environment.
You must show that you have a history of accessing funds from banks and other partners and servicing them before we talk of you partnering with any Diasporan! We will therefore be putting in place mechanisms to facilitate a sustainable and successful business partnership between locals and the Diaspora. When are we going to have the first case study? We have set a target of March 2017 and every two weeks we will be giving you an update on progress made.
