Buy Zimbabwe

Buy Zimbabwe: It’s a hard sell

Over the last few days the media has been awash with coverage of the conference “Buy Zimbabwe” a gathering that essentially sought to encourage local citizens to buy locally produced goods. Promoters of this see this is some kind of master plan well placed to help struggling businesses break even or better still this has a potential of returning these to profitability. However the question has to be asked; since the whole concept here is to dissuade citizens from purchasing imported merchandise, what do these local producers have to do to gain loyalty and custom of citizens? How will customers be protected from the excesses of these businesses given that most customers earn much lower than the estimated poverty threshold. These are very significant questions that have to be answered with equal verve by the proponents of this so called “Buy Zimbabwe”.

It is my well-considered view that this well packaged “Buy Zimbabwe” could be a ruse often used by these business lobbyists to try and justify subverting an inherent risk to any business, competition and potentially make huge profits. Proponents of this often point to the ‘success’ of a similar initiative elsewhere including South Africa the so called BUY SA however what they conveniently fail to disclose is that apparently the SA economy is dominated by a few organisations who are consistently accused of abusing their position by engaging in unfair practices like colluding on prices. While it has been difficult uncover in most cases, it thought that illegal cartels exist across many business sectors in SA and sometimes this can be evidenced by the revenues and profits generated by businesses in telecommunications, food industry, car assembling, cement manufacturing and media. Some are not as fortunate as Sasol the petroleum giant was recently caught and fined by the EU recently for running a cartel that manipulated the paraffin market. Major businesses like Tiger Brands (food), Mittal (steel), MTN and Vodacom have all been accused of certain anti competition acts and have been brought before the anti-competition tribunal. Now when cartels are created their sole purpose is to cause price rises or to put it bluntly they simply fix prices which in turn guarantees certain amounts of profits therefore the very existence of these cartels undermines the welfare of consumers.  The lobbyists groups may even rope in the government enforce this buy local only and the SA automobile industry is a prime example. In Africa most people cannot afford to buy brand new vehicles hence they resort to reconditioned second hand vehicle from Asia particularly Japan yet interestingly these are barred from the roads of SA. The usual reasons such as protecting jobs are cited yet consumers’ rights of not only South Africans but the greater Southern Africa region are not equally mentioned. As a result consumers buying South African assembled vehicles may be paying more than they should because the whole industry enjoys protection from imported vehicles hence one cannot rule out collusion or unfair practices. Once these businesses start to enjoy fruits of government protection or policies that shield them from competition, it will be difficult in the long term to rein in these once they are caught on the wrong side of law.

Coming back to Zimbabwe the situation is very different, for the size of our economy the competition is certainly there. Established players have to contend with new entrepreueners joining the competition and from the point of view of all sober minded, this should be encouraged. Now in addition to these locals producers, competition is also coming from imported merchandise particularly from China and perhaps it is this Chinese factor that may have prompted these Buy Zimbabwe enthusiasts to raise their tempo. However businesses here need to look at themselves before asking customers to buy their products because ultimately for most Zimbabwean customers it has to be the price and quality that will be the deciding factor. According to one diplomat attending the BUY ZIM the prices of local drugs cost 10 times than what they sell for in his country Egypt thus would it not be sensible for anyone to buy local drugs when he has access to cheaper ones. Of course global trade is not exactly free but we need to be assured that local producers are applying the best trade practices before entertaining complaints against unfair trade practices by other countries. Corruption has becoming heavily entrenched within business to an extend that it is seen as normal to demand kickbacks or some kind of enticement from suppliers or business partners, however when local products fail to match prices of imported stuff suddenly these businesses expect consumers to look the other way and just Buy Zimbabwean, that won’t fly.

It is fair to say that the cost build-up of most businesses include these kickbacks, bribes and inflated prices and this may partly explain why local products are expensive though it does not explain the poor quality associated with some of these products.    Business has to understand that consumers are still smarting from a decade of hyperinflation and shortages of basic products and that they will do what they can to save money as they still earn miserly wages. In addition the government should be wary of such lobbyist and instead seek a consensus between business groups and consumer and worker groups before setting policy. The last decade was a very difficult period for everyone though the silver lining from this is the apparent entrepreneur attitude borne out of those adversities; we have very dedicated small entrepreneurs but certainly we do not wish to see these becoming too big to a point where the government becomes toothless towards them as is the case in SA. The government in SA appears to pander to interests of these businesses at the expense of workers’ rights and consumers welfare because these organisations claim to pay taxes and employ thousands of workers. To an average consumer economic realities will prevail over the sentimental reasons for buying Zimbabwean products not to mention the quality of the products. Unless businesses adequately address these concerns then this Buy Zimbabwe campaign remains a hard sell.