Latest News Editor's Choice

News / Local

Mnangagwa dares public enterprises

by Staff reporter
03 Mar 2022 at 05:37hrs | Views
Parastatals and State-owned enterprises have been challenged not to be drains on the Treasury but to pay dividends and propel growth of the economy through meaningful contribution to the country's Gross Domestic Product as well as creating jobs.

The call was made by President Mnangagwa yesterday when he accepted a $15 million dividend from the Industrial Development Corporation of Zimbabwe at State House and then launched a new cotton pesticide and cattle dipping chemical  made by one of the corporation's subsidiaries.

He said the payment of dividends must be a norm and not be an exception. So the culture of inefficiencies, nepotism and opaque personnel management practices must stop forthwith.

The Government had not received dividends from the Industrial Development Corporation for the past 12 years. But that dividend to the shareholder, the Government, yesterday was a sign the Second Republic's policies were working.

"It further attests to the impact of hard, honest work and a results-oriented culture. I, thus, congratulate the Industrial Development Corporation for this demonstration of their positive turn-around efforts.

"I, however, expect much more from such a strategic national entity, with tentacles that spread across sectors of the economy," said President Mnangagwa.

"The payment of a dividend by the Industrial Development Corporation should inspire other State-owned enterprises to follow suit.

"The time has come for parastatals to propel the growth of the economy by meaningfully contributing to the country's GDP, fiscus and job creation. After all, State-controlled entities are obligated by section 195 of our National Constitution to be profitable and viable."

He noted that public enterprises were not established to be requiring constant bail-outs and capital injections from Government.

"They were created for growing our economy, providing quality goods, as well as reliable and affordable services to industry and the public at large.

"Under the Second Republic's whole of Government approach, State-owned enterprises must stand on their own feet as opposed to being a perpetual burden to the fiscus. The non-payment of rates, fines and other statutory obligations should now be a thing of the past."

President Mnangagwa said transparency and accountability within boards and management of parastatals is of vital importance.

They were expected to be accountable to shareholders, oversight bodies and the general public.

"The culture of flimsy excuses for breaching statutory requirements with regards the disclosure of financial and non-financial information must stop forthwith.

"Inefficiencies in the operations of State-owned enterprises as well as malfeasance such as nepotism and opaque personnel management practices must be a thing of the past.

"Hence, the onus is on the boards and management to guarantee adherence to mechanisms that have been put in place to prevent these practices," said President Mnanagwa.

Recently all heads of State-owned-enterprises signed performance contracts, and the President reminded them that these contracts must be upheld.

President Mnangagwa commended IDCZ for launching new products which he hopes will contribute towards increased yields and the overall production and productivity.

"These are a cotton pesticide as well as a combination liquid pesticide for dipping livestock, which are produced by Chemplex Corporation, a subsidiary of the Industrial Development Corporation.

"This development will undoubtedly help transform the cotton and livestock value chains which provide throughput to aspects of our country's manufacturing sector," said President Mnangagwa.

"The development of the cotton pesticide, the ‘Mitebuster', has come at an opportune time as we seek to restore cotton as the ‘white gold' of our country."

Speaking at the same function Industry and Commerce Minister Dr Sekai Nzenza said today therefore marks the beginning of a journey where the Industrial Development Corporation will contribute to the fulfilment of the aspirations canvassed in the National Development Strategy 1.

Thus moving the economy up the value chain through structural transformation, she said her ministry has charged the corporation with three key mandates:

"To contribute innovatively to the localisation of value chains in the companies under the company's purview.

"To enable rural industrialisation through the corporation's various operations.

"To operate efficiently, transparently and profitably."

Finance and Economic Development Minister Professor Mthuli Ncube was at the function and commended the Industrial Development Corporation. He said Treasury used to pump out money to these entities rather than receiving dividends.

IDCZ chairman Mr Winston Makamure noted that their turnaround strategies continue to show results.

Source - The Herald