OVERCOMING CHALLENGES

Zambia 2017 | INDUSTRY | INTERVIEW

TBY talks to Roseta Mwape Chabala, Managing Director of Metal Fabricators of Zambia (ZAMEFA), on the company's history, working in Zambia, and strategic partnerships.

Roseta Mwape Chabala
BIOGRAPHY
Roseta Mwape Chabala has been Managing Director of ZAMEFA since her appointment in March 2013. Prior to this appointment, Chabala was the CEO of the Zambia Association of Manufacturers from 2009 to 2013. Chabala has a MSc. in international trade policy and trade law with 10 years of experience in policy analysis, trade policy formulation, strategic planning, business and new markets development, product differentiation and brand management, key operational management, and managing the leading business membership Association in Zambia with a focus on lobbying and advocacy, capacity building, and business linkages both local and regional for the manufacturing industry.

ZAMEFA has developed significantly since its inception in 1968. What have been the defining features of its trajectory?

ZAMEFA was established in 1968, with the first production in 1970-71. The government had majority share in the company, with Phelps Dodge owning about 35%. In 1996, the government decided to privatize all its companies, including ZAMEFA. Phelps Dodge bought the government's stake and by 1997 it owned 100% of the company. This structure held until 2004, when Phelps listed ZAMEFA on the LuSE, floating some shares and starting ZAMEFA's history as a publicly listed company, albeit in private hands. In fact, ZAMEFA is the only surviving company in its original form from the privatization drive. Perhaps this success is attributable to the fact that ZAMEFA is a unique company, with a strategic location in Luanshya, just 60km from the copper mines. ZAMEFA can employ up to 360 people in successful years. At the moment we are undergoing a management shift, following a change of hands from General Cable to Reunert.

What characterizes ZAMEFA's current operations in Zambia?

We are situated in Luanshya, where we do our production, with a marketing and distribution center in Lusaka. We bring in our products from the Copperbelt and sell and distribute them here. We can produce efficiently in terms of sourcing raw materials, and although we have to stock components like plastic for insulation or center wire for armoring, the cost of doing so does not compare to the cost of stocking copper, which of course, being based where we are, we are not forced to do. Our exports are sent directly from Luanshya to foreign markets. We export regionally in South Africa, Botswana, Congo, Tanzania, Uganda, Kenya, Rwanda, and Ethiopia. Around 80% of our production is earmarked for export, almost all destined for within Africa. In the past we have also traded in Italy, France, and India. However, currently we focus more on inter-Africa trade. That said, there are many export issues within Africa; exporting to Ethiopia, for example, can be an arduous task, both bureaucratically and logistically in terms of regulations and even payments. Much of the time this involves transporting via third countries and offloading on ships, trucks, and so on. Inland transportation has not been such a problem. Our biggest market is South Africa, where we sell a large amount of copper rod.

How do you continue to reach out strategically to partners in industry and what areas of growth will you focus on in the short term?

Most utilities are moving out of copper and into aluminum, which will be a big challenge for ZAMEFA, because we do not have aluminum in this country and we would have to import it. We are preparing for this by focusing on product diversification with the wheels in motion for a project manufacturing medium-voltage cables. Everything we do now is low voltage; however, adding medium voltage would increase the range of cable that we could offer. Furthermore, currently all medium-voltage cables are imported, mainly from South Africa. If we can produce these, there will be a huge market open to us and this could also be a crucial stepping-stone into Eastern Africa. We are a member of COMESA and will be able to promote and sell this product in that market, since at the moment all medium voltage comes from Egypt. This project is the backbone of our strategic focus now in terms of diversification and product expansion. We also plan to expand geographically eastwards. The quantities of our exports are still small, though growth is rapid and steady. It does not rival our southern market yet; however, it is getting there. The fact that the South African economy is flat right now is also an issue and shifting to other markets will help us diversify risk as well.