UNTAPPED MARKET
TBY talks to Jeremy Chibuye, Executive Director of JMAAC, on the evolving client portfolio, his thoughts on the economy, and plans to grow its business.
BIOGRAPHY
Jeremy Chibuye was born in Kalulushi, Copperbelt Province. He worked for the Zambia Chamber of SMEs through the Kalulushi Business Association and later joined Alex Steward before the launch of JMAAC in 2009.How has your client portfolio developed in line with shifts in Zambia's macroeconomic landscape?
Despite 2016's recession, JMAAC managed to grow by 20%. This can be attributed to the targeting of a new sector of the business community: the marketeer. Typically, classified as an integral part of the informal sector, market traders presented a great opportunity for JMAAC. Countrywide, there are 4 million people who make up this demographic. We launched a product that focuses on empowering marketeers and with this managed to penetrate the segment. To start, we conducted a study on the informal sector and realized that existing business models did not cater to the needs of these individuals. We launched products mostly in Lusaka, since this has the largest concentration of market traders and it is also easy for us to monitor from our head office. Thus far, we have been doing well, with minimal defaults. Sometimes repayments are slow, though they always come in.
How did you reach out to this populace?
These marketeers belong to both associations and municipality councils where they are able to acquire tenant agreements and operating licenses. To reach out to marketeers, therefore, we went through the Lusaka City Council and the biggest local market in Lusaka, Soweto market, before partnering with the Zambia Marketeers Association, signing a MoU that was beneficial to both parties. We began sharing our data, helping the organization to grow its database in terms of registered members. In total, we set aside ZMK5 million for microfinance lending to marketeers in 2016, part of the first phase of this project. The next step is to roll out this product to other provinces. We did not want to do so before testing the product in Lusaka to iron out any teething problems during the pilot. In fact, we made certain miscalculations the first time around, though we have rectified them, and we now have a better product that secures us and benefits the marketeer. Our first destination will be the North-Western Province, which is where the majority of Zambia's mines are concentrated and makes economic sense. In June 2017, we plan to drop down into the Copper Belt.
Are you optimistic regarding macroeconomic factors and the measures being taken to reduce interest rates?
We should see some improvement soon. The government has shown a more active stance, determined to fulfill its commitments and generate change, so we remain optimistic. However, the other factors that negatively influence these businesses are high levels of imports; few items are manufactured locally. An import ban would be a great suggestion; however, before we introduce a carpet ban, we need to carefully assess what our current capacity is. A country can only ban imports if it produces locally, so first the government must encourage local production with economic zones and other incentives. Then, it can ban imports, or at least increase taxes on imports.
What strategy do you have in place to grow your portfolio over the next five years?
2016 was a relatively slow year. While things are picking up, our studies show that for SMEs, obstacles remain in their paths to sustainable growth. Because we understand that the key is ICT, we target ICT companies and suggest collaborations in order to increase accessibility to finance. For example, we work to develop certain applications that will benefit marketeers, SMEs, and civil servants. In response to the government's request for more efficient tollgate fee collection and administration, we are developing an online product for this purpose. Eventually, users will be able to purchase a card from us and use it to pay for tolls. Once we turn away from the old-fashioned methods of traditional banking, small players and big players both stand to benefit from the new innovative business environment. We all seek new ideas, and such innovations will have a long-term, long-lasting impact.
UNTAPPED MARKET
TABLE OF CONTENTS
Year In Review
What A Year
Zambia has long been a bastion of stability in Southern Africa, and while its economy has been rocked in recent years by the falling value of copper prices, a devaluating kwacha, and high inflation, through the Economic Recovery Program the government has bold ambitions to right the ship.
read articleReview
Convoke, Confound & Collect
Squeezed between a rock and a rather hard place by the slowdown in Chinese demand for copper, by far Zambia's biggest export and government-revenue generator, President Lungu has been forced to get creative in his country's alliances to broaden revenue streams and lessen its dependence on the vagaries of one foreign market.
read articleGuest Speaker
Dr. Stergomena L. Tax, Executive Secretary, Southern African Development Community (SADC)
TBY talks to Dr. Stergomena L. Tax, Executive Secretary of the Southern African Development Community (SADC), on regional economic development, boosting pan-continental free trade agreements, and improving security through mutual development.
read articleInterview
Susan Sikaneta, Ambassador, Zambia to Ethiopia & Permanent Representative to the African Union and Economic Commission for Africa
TBY talks to Susan Sikaneta, Ambassador of Zambia to Ethiopia & Permanent Representative to the African Union and Economic Commission for Africa, on championing peace across the continent, advancing women's rights, and promoting Pan-Africanism.
read articleInterview
Sebastian C. Kopulande, CEO, Zambian International Trade & Investment Centre (ZITIC)
TBY talks to Sebastian C. Kopulande, CEO of Zambian International Trade & Investment Centre (ZITIC), on taming austerity, stimulating sustainable growth, and creating the framework to support entrepreneurship
read articleFocus: Zambia Plus
Adding it All Up
On October 20, 2016, at the 2017 Budget Address, Finance Minister Felix Mutati launched the government's economic recovery program, christened "Zambia Plus." The program is designed to spur domestic productivity, through strengthening ties and collaborating with external donors and developers.
read articleReview: Banking
Macroeconomics Rule the Roost
In its ongoing efforts to diversify away from one principal commodity, copper, the government fosters the development, standardization, and efficacy of the private sector. In doing so the systematic support of the financial universe, especially banks, is vital, as is the goal of financial inclusion.
read articleFocus: SME Growth
IMF support program
An IMF support program stands to provide Zambia with some much-needed discipline on its expenditure and operational efficiencies; however, many caution the need for Zambia to determine what it wants to achieve and how the program will benefit the country.
read articleInterview
Christabel M. Banda, Executive Director, Insurers Association of Zambia (IAZ)
TBY talks to Christabel M. Banda, Executive Director of Insurers Association of Zambia (IAZ), on the evolution of the local insurance landscape, raising awareness, and tackling challenges in the sector.
read articleFocus: Solar
Sunny Side Up
As power demand continues to rise and power production continues to fall behind, it's the same old story for Zambia, still wrestling with an ongoing energy crisis. Public- and private-sector drives are seeking to mitigate this deficit by activating the country's solar industry.
read articleInterview
Margaret K. Chalwe-Mudenda, Director General, Zambia Information and Communications Technology Authority (ZICTA)
TBY talks to Margaret K. Chalwe-Mudenda, Director General of Zambia Information and Communications Technology Authority (ZICTA), on new projects, the ZNDC, and expectations for the year ahead.
read articleInterview
Hon. Dora Siliya, Minister, Agriculture
TBY talks to Hon. Dora Siliya, Minister of Agriculture, on the investments being made in agriculture to enable agricultural households, diversifying Zambia's basket of produce, and making international markets more accessible for local producers.
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Hon. Charles R. Banda, Minister, Tourism and Arts
TBY talks to Hon. Charles R. Banda, Minister of Tourism and Arts, on the wealth of tourism destinations within Zambia, efforts to bring more visitors to the country, and what the Tourism Development Fund will contribute to developments.
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