TWO IN THE CHAMBER

Zambia 2014 | ECONOMY | B2B: CHAMBERS

TBY talks to two leading figures from Zambia's industrial chambers on steps taken to bolster industrial output and diversify for sustainable development.

Dr. Bright Chunga
DR. BRIGHT CHUNGA
President & CEO
ZAM and Trade Kings Group
Geoffrey Sakulanda
GEOFFREY SAKULANDA
President
Zambia Chamber of Commerce and Industry (ZACCI)

The government's national goal is for industry to contribute 20% of GDP by 2030. How should this be approached, and does Zambia's legal framework support this?

DR. BRIGHT CHUNGA Our problem is not with the goals; our problem is with the journey. We know where we want to go, and are trying to settle on the most cost-effective route to reach our destination. The goal is fair and well thought out; it is the route that requires a little more thinking. I would like to see a greater relationship between statistical growth and real growth in terms of empowering ordinary Zambians. Efforts towards the goal should go beyond figures geared at impressing visiting World Bank teams. I would rather see figures that say okay, we have grown by 10%, so there should be some corresponding growth in the number of people benefitting from growth.

GEOFFREY SAKULANDA The current legal framework is sufficient, but the problem is overregulation. The government is rather hands-on, which somewhat curbs commercial growth. We are trying to engage business and government at the highest level to settle on a happy medium. Over the years, we have come to establish a strong public-private dialogue platform. In addition to regular liaison with governmental departments and ministries, we have convinced the government that ZACCI can contribute to its decision-making process. We represent the business community on various government committees, regulatory boards, and policy/decision-making bodies as a way of contributing to the process of formulating national guidelines and regulations.

A key related government goal is the diversification of the local economy, not least to attract international investors. Once diversification is achieved, what are the Zambia's relative advantages over neighboring countries?

BC Diversification depends on several issues, the first being an analysis of our natural resource base. We already have an idea of what we possess and what we can do. Economists point out that we possess 40% of the water resources in the SADC region. Yet we have done little with that potential. We also have an idea of our mineral base, yet while Zambia is three times the size of the UK, we exploit it inadequately. Therefore, diversification actually matches skill to commercial exploitation of natural resources. We are basically trying to jump start an apprenticeship scheme.

GS The foremost factor underpinning Zambia's potential is political stability. This is followed closely by its liberal economy that shuns exchange controls, price controls, and nationalization, rendering it conducive to business and appealing to the investor community. Companies are at liberty to investment and reap profits without let or hindrance. And of course living in Zambia has its charms, not least the climate and low crime rate. Another key factor is predictability, not universally found on the continent.

How has commerce and industry contributed to Zambia's growth in previous years? And how do you develop the rudiments that industry requires to flourish?

GS GDP growth is about business, as state actors are engaged in the consumption side of the economy. The productive sector is our domain, which generates wealth, jobs, and tax revenues. Government revenue information reveals that over the past 15 years Zambia has slowly outgrown its dependence on foreign aid in supporting its budget. About 70% of the Zambian budget is now funded from internal revenue sources, confirming both the growth of business and tax revenues, and improved tax collection rates.

BC In partnership with the World Bank, we have conducted an audit of our skill requirements, which provided a clearer handle of what types of skills are most required. Secondly, we have been working with the School of Engineering at the University of Zambia. We have also been working with the Technical Education, Vocational, and Entrepreneurship Training Authority (TEVETA), which trains students in the real world skills that we are actually looking for.