Category Archives: Economics & Entrepreneurship

WHY ENTREPRENEURSHIP IN ZIMBABWE HAS NOT RESULTED IN ECONOMIC GROWTH

By Michelle Munatswa

It appears that everyone in Zimbabwe is an entrepreneur. By virtue of the multitudes having one venture or another in bussiness, we are practically a nation of entrepreneurs. So why can we not turn our entrepreneurial might into sustained economic growth? Why can’t we see the emergence of more Strive Masiyiwa-like business people?

The answer to the above two questions lies in asking a third question: When does entrepreneurship not lead to economic growth? Below I have highlighted some factors contributing to a stagnant economy despite our entrepreneurial activities.

Exploitative entrepreneurship

I consider exploitative entrepreneurship as any business or venture that profits without regard to the accepted social and cultural norms and the wellbeing of others. For example, Kombi drivers from my beloved Pumula South come to mind. The normal fare to Pumula South is 50cents, but if it is after 10pm the fair doubles to a dollar. Time of day does not really add to their cost but simply presents an opportunity for them to exploit commuters who are desperate to go home. The drivers see an opportunity to make more money at night but there is no production or value added in the said venture. There is no consideration as to fairness or financial impact on the commuters. There is no value addition or production, but simply an unfair transfer of money. We need to guard against ideas that make the individual profit at the expense of the majority. Such ideas breed a culture of greed and do not encourage innovation but rather exploitation. Such ventures rob the working class of potential savings which are important for the functioning of financial institutions.

Exploitative entrepreneurship does not cause economic growth as few benefit (and live extravagant lives) while the majority wallow in poverty. The majority are robbed of purchasing power meaning that industry will not be profitable.

Occasion entrepreneurship (One hit wonder)

Entrepreneurship involves identifying opportunities. In Zimbabwe we have one hit entrepreneurs, who come across opportunities (‘Gap’) and make a quick buck, buy an ex-japan car and are back at the same cashflows as before. This represents the majority of the Zimbabweans, always looking out to hear of where there is a shortage of anything and try seek supply to meet the demand. Such business practices are not sustainable and do not add economic value as one cannot consistently be guaranteed that an opportunity will come their way. The income from once off deals is often not reinvested but is consumed callously. Once off deals are good as long as the individuals understand the need to reinvest the proceeds as opposed to having a consumptive mentality to profit. (Kudya mbewu). For there to be economic growth, there has to be both constant idea generation and also constant production. Once off deals do not bring individual or national sustainable income. Thus, for our ventures to result in economic growth, they have to be sustainable and continuous ventures.

Value creation and hunter gatherer budgeting.

Until recently, Zimbabweans associated term “Hunter gatherer” with the Khoi-san people, but the biti.jpgHonourable Tendai Biti linked the term to our country’s fiscal policy. I would also like to link it to our entrepreneurial approach. Our entrepreneurs can only invest what they have gathered. Our people have very little disposable income and consequently very little investment income. This means that their business will be limited to buying and selling airtime in the streets or other small ventures. Even though this feeds families, it does not create additional employment as most of the ventures are one man part-time shows. Our entrepreneurial activities are under capitalised and under- funded. Our “hunter gatherer”/cash budgeting approach to development limits the amount of capital available for people to invest in enterprise. Entrepreneurial activities in Zimbabwe have not led to economic growth because many are of the ventures are very small scale and only allow the entrepreneur to feed the family on a monthly basis as opposed to growing industry and trade. There is little or no pooling of resources to enable business growth.

Lack of government support to entrepreneurship

The government is responsible for shaping economic policy and creating an enabling environment for all enterprise to flourish. No clear policy direction has been established. This causes people to shy away from investing in enterprise. One can sight the small scale farmers who were given land as entrepreneurs and the move as a beacon of government involvement in entrepreneurship. However, my contention is that even the small scale farmers have received inadequate support to the extent that they have only been able to produce enough to feed their families and not the nation of Zimbabwe. Until government accepts an increased role in supporting entrepreneurs and creating an enabling environment for the growth of business, our ideas shall always remain barren and our bellies shall forever become empty. Government support should also be conditional and transparent. Government support should not only be financial but it should also be technical. Government policy should be friendly to business.

You are not still young, you are just not paying attention.

By Sineke Sibanda

In the just ended Zimbabwe International Trade Fair, I interacted with a number of entrepreneurs. It was amazing to see what Africans can do, and it just got me thinking, over and over again.

When I looked at some of the inventions, I thought to myself, I could see a giant rise out of Africa, given the next 20 years of a consistent positive attitude towards development.

So I heard people talk after the whole day at Trade Fair, the complaints ensued from the fact that our African countries do not have opportunities, they were too young and lots of other things. I thought to myself, is it really because there are no opportunities or people are simply not paying attention?

I sincerely believe that we are not too young, too broke or too whatever, we are simply not paying attention.

With the current state of African economies, it might need about 70-140 years of consistent development for it to reach where the first world countries are right now; and to think there are no opportunities is injustice to the future generations.

I’m not necessarily shunning out that Africa, including its leadership have a problem but my point is, we are not doing enough to make ourselves better. One of the biggest opportunities you have is that in trying to answer a need in your society, you inadvertently make yourself better.

One of the things I have learnt in my Critical theory courses and Popular Culture classes is that capitalism, which is largely the driving force behind world systems today thrives on competition and false consciousness where we are made to think that everything we want in the world have. Capitalism creates imaginary solutions, there is a lot we still need and we can still do in Africa, as Africans if we pay attention.

A capitalist system that is also stealing our time right now is the school system. Most of us are made to believe that we can only make meaningful changes after graduating but by the time we graduate, we already have other pressures that force us instead to look for a job and answer immediate needs within our families. This creates little time for us to think bigger and beyond, before we know it, we have all been working for a capitalist and we are looking forward to retiring. What solution have we brought to the world, or our communities? Nothing. To be frank, Africa’s children need to poke the bubble of false consciousness sooner and help Africa be the place to be.

We need to start paying attention to what matters! That which is beyond just us…

Internet Marketing key for your business.

By Sineke Sibanda

“If your business is not on the internet, then your business will be out of business.” – Bill Gates.

Over time, Gates’ words have been gathering moss, pointing to the fact that the future we are headed towards will be determined more by the internet than anything else.

There is so much activity that happens online now, such that most businesses can not doInternetSales.jpg without. Just to carry out an x-ray assessment of this claim; consider how banks, mobile networks, clothing retail stores and gadgets that we now buy or access their services from the comfort of our homes. This simply points to how the world of business has been significantly reconfigured, but the question is, what does it mean to you?

It may simply mean that if you decide to keep your invention off the internet, you definitely will be certain that there is little that invention will do to the world beyond your reach.

So to be quite honest, there has to be a way you can turn your innovation into something bigger and better.

packagepricing.jpgThe internet now offers a number of answers to different questions, why cant your innovation be also seen in the list of answers. Probably a lot of advantages you know them and there has been a lot of articles written and awash on the web as to how to ‘neticise’ (putting it on the net) your business.

I will not do that again but all I can say hear is that one of the reasons we are really not marketing our businesses online from this end of the world (Africa) is normally because we lack confidence in our creations. We are not sure if it’s the right answer, if it’s the correct innovation, if people will welcome it well.

I have heard lots of testimonies and testified to a number of unfortunate instances personally but the honest truth is, just do what you have to do. Its gonna be scary at first but I mean, cease the moment, be confident and just do it. Do you still care about what people really have to say, that ain’t gonna bring the money you have been looking for, just do what you have to do.

University Students Live off Betting.

Sineke Sibanda

Metso is a student at the National University of Science and Technology. He has three other siblings, one is starting her degree programme, the other just started her ‘A’ level at Empandeni boarding school and the last one is writing her form four examinations this year.

With much of his parents’ attention going to his three female siblings, he has to take care of himself. It has not been easy, and he has since resorted to, soccer betting, a form of gambling to subsidise his welfare.

Metso is among a host of other college students who have enrolled into this gambling circus to try and make ends meet as they strive towards completing their studies.

At a time when Zimbabwe is marred with high rates of unemployment, industries characterised with no activity, with only big rusty keys hanging on the falling gates; betting halls have become the new industries with regular patrons thronging these spaces from as early as 7am in the morning till 1030pm in the evenings daily.

Patson Nkomo, a security official at one of the betting halls in the city observes that some have become regulars at the shop, and only absent when they fall sick.

“Others are now informal employees here (laughs), they are here 24/7. With the issue of unemployment so high in Zimbabwe, this is where others make their living, including university students from,” said Nkomo.

According to Admire Mapani, a student at the Bulawayo Polytechnic, betting has become a way of life for most college students.

“There is so much peer pressure we go through at school,” said Mapani. “You meet people from different families and you are also faced with the challenge to survive at-least, so the little your parents send you, you spin some of it through betting with the hope of multiplying it.”

However, issues to do with addiction of this sort of gambling tends to haunt.

According to Metso, he finds it hard to pass by the shop without being tempted to bet.

“I think I’m becoming an addict. I find it hard to pass by the soccer shop without being tempted to bet. Sometimes I even use my lunch money. I know its bad but I can’t control it sometimes”

This sort of gambling has become a normal routine and to others a little bit addictive. For the lucky ones, they have managed to get the best out of the experiences and to the unlucky, lots of money has been lost to the betting shops.

Being a student too, I know how hard college life can be especially if you are far from home. It can be pretty tricky and because there are no grants or student stipends, anything that brings money could be ideal.

Over the years, we have heard of alarming rates of prostitution from college girls, selling of drugs by guys and now betting is the new trade. The most important pre –occupation is making money to be

Good as it may sound, obviously for the owners of the shops, my concern is largely on the development part of our countries.

Possibly this may not be a phenomenon only peculiar to Zimbabwe, I’m sure some countries may be experiencing this too. I stand to be corrected, does this kind of business in anyway promote the development of individuals? Or maybe I should be asking the economic value of betting.

With economic downturn and a lack disposable income, betting has become one of the last resorts among youths in Zimbabwe.

This trade has been around for a while, generally known as lotto/ lottery. A new form seems to have emerged, soccer bet.

“If its to be, its up to me.”

Sineke Sibanda

There is a concept I learnt in my Entrepreneurship class, it basically touched on what we call the “locus of control”. What this concept simply talks about is how people decide and define their fate. It presents two variables, the internal and the external locus of control.

While the internal locus of control believes that one’s fate lies in their own hands, the external locus of control attributes everything to the unknown, in most cases, a deity, depending on the beliefs an individual holds. I’m really not interested in the external one, I believe its for life cowards, I want to talk about the other one.

self-motivation-quotes-1-728.jpgWhat is normally assumed is that if one has an internal locus of control, they are probably likely to succeed because they believe in themselves. They are driven to deliver results, simply because the world works on one fundamental principle, action. You go towards what you want.

An interesting lesson I learnt from a source, an upcoming entreprepreneur, Chiedza Mapani, (26), she said that with life, you cannot expect someone to live it for you.

“Everything rises and falls with you and the sooner you learn that, the better for you. There is no way you can think that things will fall into place without you moving a finger,” she said.

According to another, Elvis Jaleke, a student of Entrepreneurship from Lupane State University, what determines growth of any kind is your belief in what you can do.

“In all honesty,” Jaleke said. “I’m yet to see a miracle when it comes to business. When you relax, you lose out, when you act, you learn and ultimately grow.”

These interesting perspectives generally point to the fact that if anything is to be, it has to be up to you. Everything depends on how much you put into it. You have the power to shape the world, make the business you want.

If its to be, its up to you. You have to make it work yourself, model it the way you want it to be.