Its true Zimbabwe is going through economic problems with high unemployment rates, unstable currency, fuel shortages and low industrial productivity. To an outsider, its all gloom and doom in the resource rich country but a deep analysis of the performance of certain sectors shows that some are in fact smiling all the way to the bank. Some are even increasing their investment in particular economic sectors.
We all agree that the country has great potential, if the correct policies are put in place, if our political leaders agree to work together then an economic boom is just a few metres away! We experienced this during the Government of National Unity period. A massive boost in business confidence resulted in an instant solution to forex problems, empty shop shelves, unemployment and economic recession.
Our easier path remains political engagement by our leading political actors. They hold the keys to our economic recovery. They can bring smiles to millions of Zimbabweans in the country and those dotted across the globe. We indeed can leapfrog some of the countries which overtook us over the past decades.
Human capital abounds in the country, we have a lot of untapped natural resources, generally peaceful and hardworking citizens, still possess good infrastructure in some areas, great climate and high entrepreneurial skills and interest.
We are currently operating far below our potential but who is shining despite the economic challenges?
- Telecommunication Sector: Its all good for the likes of Econet, Telecel and Netone. The increased use of mobile telephone is sustaining the business models by these telecoms giants and they are enjoying their time in the sunshine.
- Financial Sector: We have not opened new banks yet, we still encounter serious cash shortages and forex availability but our banks are not struggling at all. We even had Malawians grabbing the local Barclays Bank stake. The question is where are you diasporans? Why did you miss out on the Barclays Bank stake? With banks paying no one interest for funds they handle life is good for the financial sector. For new investors-do target bureau de changes introduction which require permits of US$15.000. If you can target strategic places such as borders, airports and busy cross border bus ranks then you will have a stake on the informal forex currency market. Figures released by the Reserve Bank showed that for the first 10 days, average forex traded equalled US$2.4m versus import requirements of US$19.6m. This means only 12% of import needs are being handled through formal means with 88% of the market being satisfied through the informal sector.
- Mining, Mining and Mining: In Zimbabwe if you want to follow the money-then follow the Chinese! Did you see the list of forex externalisers that was published early last year? Did you see the direction of the forex flows? The direction was East….our Chinese cousins involved in mining where spiriting away forex to their homeland. The Chinese are not involved in retail shops, not involved in kombi business. Certainly not involved in farming-they have a niche investment area-mining! This is where the greatest potential for new investors is…platinum, gold, chrome and other precious minerals. Gold output is at an all time high with the Reserve Bank having disbursed more than US120m to date and looking forward to disbursing more to small scale gold miners. Chrome miners around Midlands are not complaining about the effects of the bad economy, they are getting their hands dirty in chrome mining. Suppliers of inputs such as chemicals, equipment and machinery are increasing their investment in the area. The future of Zim is indeed Gold!
- Tourism: If you want to follow the direction of money in Zim, follow the Chinese and also our great white cousins. They know the economy better and they are putting their money in one expanding sector-tourism! Harare and Bulawayo can be shut down by violent disturbances but this does not affect much tourists visiting Victoria Falls, Mana Pools, Gonarezhou, Hwange and Kariba. On this site, we have published official tourism projection statistics. Search for the statistics and watch closely why investment in the sector is on an upward trajectory. Reading this section without a visit to our main tourist sites would not do justice to this article…pay a visit and see for yourself the acute shortage of accommodation in Victoria falls driven by the huge influx of tourists. There is an added advantage of tourists bringing foreign currency. We did a detailed report for our subscribed members on the sector. The tourism sector is the next gold and those closely monitoring and investing in it are smiling despite most of the people experiencing economic challenges.
- Construction: A visit to Harare, Bulawayo and other main urban centres shows that construction is at a standstill. New buildings coming up, no cranes to show serious economic activity like what you experience when you visit Maputo, Lilongwe, Blantyre, Lusaka, Maseru or Joburg. One day Harare and Bulawayo will roar again! However small pockets of residential housing developments are happening on the ground. Harare has a housing backlog of more than 500,000 and this is great potential for investors. Have you seen any hardware closing shop in Harare? Visit most hardware shops for a feel of what is happening on the ground. Beta bricks is opening new brick making plants-what are they seeing that the rest of us do not see?
- Alternative Energy: If you want to follow the money then Strive Masiyiwa is your main man. South Africa is experiencing power shortages, Malawi too, Botswana not left in the equation. Do you see the power gap? The sectors require heavy capital outlay and is facing pressure from increased population growth. Strive is putting his monies on the solar projects and we have every reason to follow his direction. To entrepreneurs based in RSA, form alternative energy companies that help install solar power and invertors for businesses and households…great business potential.
- Cross Borders: Your first point of reference is our import bill! What are Zimbabweans are importing and why? The absence or closing down of many companies has created an import gap for food, machinery and equipment. We do not have companies manufacturing cellphones, computers, vehicles, solar energy products and other products. Carefully study who is bringing food to Zimbabwe imported from Musina. Various cartels control the food import business and do not be shocked to see buses travelling from Beitbridge to Harare with less than 4 passengers but the buses will be fully loaded lol Kuti ko bhazi rizere neyi iri muboot repasi, pamusoro uye mukati….cartels who do not even visit Musina for imports but sending runners! Some cross border buses are now involved in money transfer businesses. You want to send money to SA? No need to worry, send it to certain bus companies and your relatives or landlords in SA will collect the cash in SA-no need for physical funds movement! With more than 3 million Zimbabweans resident in SA, the movement of goods is a multi- million dollar business earning some malayitshas up to R100.000 per month in revenue. For new entrants, form reputable companies that transport goods between SA and Zim. Do we need to mention import and exports shipping companies?
- Auto Industry Value Chain: Ever counted the number of cars in your street? The number of cars on the roads? Have you ever wondered who benefits from these many cars? It’s the auto parts industry dominated by Nigerians and Pakistanis. Zimbabweans need to harness resources and join this lucrative sector. Other beneficiaries of this sector includes insurance companies, mechanics and auto repair companies. Do we need to mention the fuel import sector?
- Entrepreneurs support: Have you visited Farm and City lately? Have you been to poultry companies that supply chicks and feed? If the target of your goods and services are consumers then expect low demand as people grapple with economic challenges in the short to medium term basis. Your business model should include supply of goods or services to people who want to earn a living! With high unemployment and a struggling economy….most people are turning to entrepreneurship for survival. Mention farming, mining, retail, transport etc. A person selling a kombi in Harare is likely to get more buyers than one selling a luxury car. One selling a tractor is at an advantage than someone selling sofas. Muhammed Musa gets more monies selling to tuck shop owners than direct consumers. The same model is applying to cross borders who are targeting entrepreneurs. A builder focusing on chicken runs has better chances than a builder of homes. A company that drills boreholes for farmers has a better chance than one focusing on homes. Fertiliser companies make more money because they are selling directly to people looking for money. Now this is a million dollar advice! Who are you selling your goods to? Analyse this thinking and you will see who is smiling in Harare!
- Global minded Zimbos: Zim experiencing economic challenges? Yes but is the situation the same with Malawi, Zambia, South Africa, Botswana, Lesotho and Angola? Not at all…some thriving, there is economic boom in Zambia and Maputo. Instead of starting businesses in Zim only, the trend is looking beyond the country and setting up businesses in neighbouring countries. Construction companies in Maputo and Lusaka, maputi making in RSA, farming in Malawi, buying clothes in China and selling in Namibia. Sourcing fruits and vegetables from RSA and selling in Malawi. Buying goods from Namibia and selling in Angola. Last time we were in Lesotho, we witnessed entrepreneurs who buy goods from SA and sell them in the country. The only challenge is Zimbabweans are now flooding the streets of neighbouring countries and this is not healthy in the long run. Every street in Windhoek has Zimbabweans selling stuff and recent media coverage shows our neighbours are running out of patience.
We hope we inspired you with some of the stuff we have covered. Do get a copy of our last book Business Opportunities for Zimbabweans which we published last year. Apart from many business ideas, we also included key contacts in DRC, Angola, Mozambique, India and Dubai. They key contacts can assist you unlock business opportunities in those countries.
Our next book will be coming your way in May this year and we promise a better and well researched output. We hope our leaders will take time to consider the impact of the challenges we are facing. The cross borders spending endless periods away from their families, cross borders sleeping endless nights on the buses. Zimbabweans sleeping on the streets in neighbouring countries. Thousands of graduates who have lost hope of getting jobs and many others.
We remain positive that something big is in the pipeline and our great nation will once more roar again.
