SOCIAL MUSCLE

Zambia 2014 | ECONOMY | INTERVIEW

TBY talks to Hon. Fackson U. Shamenda, Minister of Labor and Social Security, on local labor laws, informal employment, and the need to generate new jobs.

Hon. Fackson U. Shamenda
BIOGRAPHY
Hon. Fackson Shamenda is a renowned trade unionist with over 30 years of experience when he started as a leader of the Zambian postal workers union, which also enabled him to become active at the continental and international levels in the post and telecommunications sector. He became the Coordinator in Africa for Union Network International in 2000. He is a former President of the Zambia Congress of Trade Unions as well as a former President of the International Confederation of Free Trade Unions (ICFTU). He is the first and only African trade unionist to date to hold the ICFTU post. He succeeded the outgoing ZCTU President Fredrick Chiluba, when the latter was elected President of Zambia in 1991. Shamenda was appointed Minister of Labor and Social Security in 2011 after the Patriotic Front Government of President Michael Sata won the elections. He is also a Member of Parliament for Ndola Central constituency in the town of Ndola in Copperbelt province.

GDP in Zambia has grown by 7% YoY; however, unemployment has remained at around 15%. What are the main policies of your ministry to address this?

As you are aware, all around the world the way to address unemployment is to regulate labor relations. We have set up labor market policies to provide an enabling environment where human resources are able to respond to higher levels of productivity. In the first instance, you need to have a working environment where those people are happy. As much as we welcome investment coming in, which is very important, it results in the government having little participation in community activities. Hence, we aim to provide an environment where we make sure we have high levels of productivity. If you produce, then you grow the economy, and growth benefits the majority of the people. For some time now, we have had a situation where GDP has been growing by quite a significant number; nevertheless, this has not been seen to benefit the people who are producing. In this case, we would like informal jobs to grow. In a good number of countries at the moment, particularly in the third world, the informal economy has become the main economy. We need to work on people who are in the informal economy rather than concentrating on those in the formal economy. We are aware of SMEs; however, at the same time many people are working out there on their own. Therefore, it is important as we grow the economy to double the level of the formal economy because it is the formal economy that activates the informal economy. We are also monitoring to ensure that there are such services as workers rights and also access to social security services for people who are working in the informal economy. That has just never been thought of before. The figure is less than 15% in formal employment. We are talking about 600,000 out of 14 million workers. We have a significant number of people who are leaving the education system at the secondary school level, and in some cases who are dropping out at primary school level. If we are not able to provide employment, we are creating more poverty, and we are trying to resolve this as a government.

How attractive do you think the current legal framework in the labor market is for international investors?

I would say it is quite attractive in the sense that if you look at the background of the President he was at one time a trade union leader. I spent three-quarters of my life in the trade unions myself; however, that does not mean we are running trade unions within the government. We are in government now and therefore we are looking at balancing human capital as well as the investment that is coming in. Our challenge is to make sure there is a balance, that there is a level playing field. And we try as much as possible to be in line with international labor standards. You cannot do anything better than that to attract FDI because FDI is mobile. International standards are the basic minimum and that is what we are delivering. We can say we are competitive in the sense that we are not embarking on putting in labor laws that are outside the norms of international conventions.

What industries do you think have greater potential to generate more jobs in Zambia in the coming years?

One is agriculture. We have the potential to feed the whole of the continent as well as outside the continent. Zambia's land is highly fertile and the climate is quite favorable, although we have suffered from some of the effects of climate change too. This government is giving top priority to agriculture—for the first time in the history of this country we have produced a sizeable amount of our staple foods. We are putting in measures to make sure we put up numerous storage facilities because it is not good to waste food, it is also costly, and it discourages peasant farmers. I would say that agriculture is one main area we are developing. Also, tourism has huge potential, and after that manufacturing and construction have been the government's major focus.

During your time in office you have raised the minimum wage. What impact has that had on the Zambian economy?

I think it has motivated Zambian workers, and motivated employees can be more productive. Also, the worker will have more disposable income, which means he will be able to assist all the members of his family, particularly those who are not working, and support his children to go to school. It always goes back to productivity, then with productive jobs we can grow the economy, and then we can create more jobs. In the absence of that we have got a major problem. We believe the minimum wage should be based on that of other countries, and should enable workers to get the basics of life so they can be sustained from the beginning of the month to the end of the month. It does not make sense if what you earn in a month, you have to spend in one or two weeks. I have established minimum wages for different sectors. Those working in the mining sector should have a minimum wage for mining work. It depends on the sector. In the agricultural sector we may even have three types of minimum wage depending on whether you are working in a large agricultural industry or on a small-scale farm.

To what degree do you think international investment can fix Zambia's current unemployment rate?

The world has become a small village. In some countries they have developed to the extent that they have large institutions operating in what are highly industrialized countries, and now they have got to go out particularly into the developing world. The environment here is conducive. We have a good climate, good natural resources, and particularly in areas such as mining and oil we have serious potential, which is conducive to FDI. Having said that, if they come here and do not create employment, then you start questioning what is happening. As they invest, they grow the economy and then you must employ more people to produce. As a country, you bring up whatever institutions are bringing up growth, whether it be manufacturing, mining, or construction. If it is a highly technical type of investment, two or three people may have to be employed.

What is your outlook for the Zambian labor market and how do you think it will evolve?

I would say that with the current infrastructure development Zambia is conducive to the expansion of the labor market. In addition to the other pieces of legislation we are putting in place, shortly we will be taking a bill to parliament to establish productivity centers under this ministry. Through this we can reactivate the economy and help people see how they can produce better and grow their businesses.