Sunday, September 24, 2017

Africa Has to Be Wary About Its Resources
Taurai Changwa
Zimbabwe Sunday Mail

AS commodity prices are trekking northwards on the international market, many African countries, which have predominantly resource-rich economies, are beginning to celebrate.

Growth in many such resource-rich countries, including Zimbabwe, is expected to be underpinned by the mining sector.

But it must be noted that the net benefit accrues to global resource consumers who value add these minerals and resources into commodities that are later on absorbed as finished products by African countries.

So Africa becomes the biggest loser.

Greed has really stifled progress in Africa.

Moreso, there is a global financial architecture that is not friendly to African economies.

Many global mining houses that make a living out of mining precious resources on the continent have offshore accounts through which they use to bank their proceeds.

This, they argue, is ostensibly meant to facilitate offshore transactions.

For African countries, money that is banked in this way becomes dead capital since it does not sweat for local economies.

Though it is practically impossible to list the sheer amount of minerals that are found on the continent, it is very easy to count companies that are involved in value addition and beneficiation.

Clearly, with such seemingly scandalous endowments, Africa should be the richest continent in the universe.

However, as long as the current status quo remains, Africa will continue to be a source of raw materials that sustains industrialisation and wealth creation on other continents.

Time and again, President Robert Mugabe always talks about beneficiation, but little progress is being made.

It is worrying that Africa continues to import both basic commodities and sundry items.

There is no reason for all these products not to be manufactured in Africa.

Africans are not children of a lesser God, whatever the Americans, Europeans, Australians and Asian can do, they, too, can also accomplish.

Greed and corruption, however, continue to be the major drawback.

Africa is bleeding because of greed.

This narrative can be easily changed.

America boasts of the likes of Andrew Carnegi, J P Morgan, J D Rockefeller, Levi Strauss who were the 19th century entrepreneurs that helped shape America made it what it is today.

Every civilisation has not always been rich, civilisations have had to work hard to achieve affluence.

Africa can easily write the same script.

There are so many African entrepreneurs on the continent that are showing the way.

It is time for us to turn the opportunities that exist on the continent into material gain.

Every nation works for the good of its own citizens, it is a fallacy to think that there is an investor that will work for the common good of the country.

It therefore becomes incumbent upon us to be the authors of our own destiny.

Often those who come as angel investors end up looting local resources.

So there is need to begin the small steps to success.

No one ever started big and it is important to eliminate a mindset of wanting “quick wins”.

Equally important is the need to unlearn the attitude of being individualistic in nature.

Enterpreneurs worth their salt should be able to love behind enduring legacies.

Coca Cola was produced in the 18th century but up until today it remains a competitive product.

Steve Jobs invested in the iPhone and the brand is still competitive today, even after his untimely demise.

We also need to introspect and ask ourselves difficult questions.

What is the legacy that we are leaving behind?

But this obviously cannot happen if we pre-occupy ourselves with selling raw materials.

As observed by both the Southern African Development Community and the African Union, the continent desperately needs to industrialise.

It is now time for the gospel of self-sufficiency.

Deliberate empowerment programmes that have been created by Government since the 1990s have been able to spawn a new class of successful black investors, across many industries, including banking, insurance and agro-processing, among others, and it is the same talent pool that has to be leveraged on to create a new successful future for the country.

We need to get the maximum possible value from our natural resources.

We must not think short term.

Foreign aid isn’t the solution.

To sustainably change our economic fortunes, there is need to change the way we talk and think about Africa.

It is not about making people feel guilty, but correctly diagnosing a problem in order to provide a solution.

We are not, currently, “helping” Africa. Africa is rich.

Let’s stop making it poorer.

By adding value to our own natural resources, we are able to ensure that at least we also benefit during the boom cycle in the global commodities market.

Taurai Changwa is a member of the Institute of Chartered Accountants of Zimbabwe and an Estate Administrator. He has vast experience on tax, accounting, audit and corporate governance issues. He is a director of Umar & Tach Advisory. He writes in his personal capacity and can be contacted at or or whatsapp on 0772374784.

No comments: