Zimbabwean businesses are facing daunting economic problems. However, it appears newly appointed Confederation of Zimbabwe Industries (CZI) president and managing director of Schweppes Zimbabwe, Charles Msipa (CM) is up to the task ahead.
Zimbabwe Independent reporter, Hazel Ndebele, caught up with the CZI president this week and spoke to him about his background, future role of the organisation and the impending elections. He also raised fears of the continuing de-industrialisation in Zimbabwe.
HN: What are your immediate plans or strategies as the new CZI President?
CM: Some of the key issues that the previous leadership of CZI was seized with are still work in progress —many businesses in the manufacturing sector are still in crisis or in the intensive care unit — a situation which continues to adversely impact the economy and employment levels. We shall continue to engage stakeholders in the public and private sector to seek measures and policies that create an enabling environment for business viability and competitiveness.
Political stability is an essential precondition for an environment that fosters business and economic growth. As CZI we are calling for peaceful and credible elections and advocating for a clear elections roadmap to be agreed on and announced, which enables business in short and medium range planning.
The current situation of contestation between the political parties regarding timelines for elections is generating a great deal of uncertainty and anxiety. The other issue on our agenda has to do with improving the business environment in Zimbabwe, with particular focus on the issues to do with industrial competitiveness.
HN: What would you consider as key priorities for industry this year?
CM: De-industrialisation of Zimbabwe is an issue of major concern for us. As I have said industry is in crisis, several companies/factories have either closed down or down-scaled operations. This situation needs to be arrested and reversed as a matter of urgency. This we believe is the number one priority for industry.
HN: How effective has CZI been in terms of its mandate and what are you bringing in?
CM: The lobby and advocacy at CZI has been met with mixed fortunes, I can safely say that in certain quarters we have proffered advice and suggestions which have been taken on board. However, in certain areas we feel that it has fallen on deaf ears. But as an organisation whose aim is to promote an ideal operating environment we will continue to knock on the doors of government, regulatory bodies, donors multilateral institutions until we achieve a sustainable operating environment that is conducive to private sector development. I have been part of the executive committee of CZI in my capacity as vice-president and the new leadership team will continue to work on these issues.
HN: How are liquidity challenges affecting business?
CM: According to our 2012 State of the Manufacturing Sector Survey, availability and cost of funding was identified as having the greatest impact on capacity utilisation — which speaks volumes on the impact on liquidity challenges.
Average capacity utilisation was recorded to have declined in 2012 compared to 2011, so one can assume that this negatively impacted on viability of business. The situation would appear to be further worsening with several companies reportedly failing to meet monthly salary and wage bills. This also means companies do not have resources to plough into research and development, meaning our businesses will remain uncompetitive in an intensely competitive globalised environment.
HN: Cheap imports are hurting the country’s businesses. What, in your view, can be done about this?
CM: Cheap and substandard imports are definitely having an impact on business and this is worsened by what we term “leaky borders”. These products render locally-manufactured goods uncompetitive.
However, CZI is currently working with Zimra and the ministry of Finance on addressing the issue of leaky borders. But this alone is not enough. We need to protect the local industry from the flooding of these cheap imports. Government needs to make a decision: “Are we for a Zimbabwe with a thriving industrial sector or have we decided to de-industrialise?” At the moment it would appear that we have decided to de-industrialise. It is not just about the products we are making but there are greater implications on the economy — our current trade deficit is unsustainable, we cannot continue to import without growing our exports.
HN: What is CZI’s relationship with government?
CM: CZI continues to work closely with various line ministries, particularly the economic ministries. We are consulted from time to time, especially with regards to economic and industrial policies and we, in turn, also engage the various ministries on important issues affecting industry.
HN: What is the atmosphere in the business community regarding national elections?
CM: As I highlighted ealier, elections are a part of the democratic process of any nation and we are calling for the pronouncement of a clear elections roadmap that will lead to peaceful and credible elections to ensure continued economic stability and re-engagement with the international community. As my predecessor indicated previously, peace before, during and after the elections is a key ingredient for the credibility and success of the elections.
HN: Kindly share with us your professional and academic background.
CM: I hold a Bachelor of Law (BL), Bachelor of Laws (LLB), Master of Laws (LLM) and Master of Arts in Law & Diplomacy (MALD) degrees.
I started off my professional career as a lawyer in private practice after completing legal studies at the University of Zimbabwe. I subsequently moved to the corporate sector, and during the course of the last 21 years, I have worked in the beverage industry on a variety of assignments, including legal advice, public affairs, sales and marketing in Zimbabwe, Zambia , Malawi and US. I joined Schweppes Zimbabwe Limited in 2005 as sales and marketing director, and have been in my current role (managing director) since August 2006.