Local authorities stifling business growth: Industry

MANY local authorities in Zimbabwe are using archaic laws and municipal by-laws that do not take into account the changing business environment and globalisation, a situation that has made it difficult for industry to flourish.

BY MTHANDAZO NYONI

Addressing delegates at the ongoing Local Government Investment Conference being held in Bulawayo, Confederation of Zimbabwe Industries Matabeleland chapter president Shepherd Chawira said there were various impediments to ease-of-doing business initiatives in the local authorities.

“… many local authorities in Zimbabwe are operating under archaic laws and municipal by-laws that do not take into account the changing business environment, and globalisation. Over a period of time, many obstacles that comprise high taxes and rates, long registration and licensing processes and policy adjustments, has continuously been the order of the day in both urban and rural local authorities in Zimbabwe,” Chawira said.

“These issues have further portrayed the Zimbabwean local governance in a bad picture, as the local authorities are viewed as regulating for revenue and not for business growth, creating a perception of local authorities not being favourable to support business growth.”

Chawira said, as such, local authority regulations that create a conducive environment for business are pivotal in promoting local economic development.

He said economic development thrives in an environment where there is co-operation between government, business and labour.

“With the talk of devolution, provincial and local authorities should position themselves, through ease-of-doing business reforms, to attract investments into their areas of jurisdiction. Business would want to set up operations in areas that make them more viable and competitive. This is true, not only at national level, but at local level as well,” the CZI regional boss said.

Chawira recommended that on devolution, the initial focus of provincial and local authorities, should be to grow their economies.

“With industry at 30% capacity utilisation, surely the strategy should be to grow this number and attract new investments, thereby increasing the revenue base. This, therefore, means that provincial and local authorities should regulate for growth of their economies and not revenue generation as their major focus,” he said, adding that increased investments in the local area would lead to local economic development and more for the authority.

Chawira called upon local authorities to involve local stakeholders in local economic development of strategies and planning to ensure that there is input by all stakeholders in policy formulation.

He challenged local authorities to come up with conducive investment environments.

“What brings investment is a conducive environment. Provincial authorities should be responsive to the needs of business and industry,” Chawira said.

Speaking at the same event, Zimbabwe National Chamber of Commerce Matabeleland chapter chairperson Brighton Ncube said industry was being weighed down by energy challenges.

“Companies are currently running production on generators — nine hours on a daily basis, which translates to 150 litres per day, 750 litres per week and 3 165 litres of diesel per month. To put it in monetary value, running a generator costs around $53 805 per month,” he said.

Ncube said production had been significantly affected by unavailability of affordable fuel and electricity outages.

He said corruption was rampant within city councils, especially on acquiring land for commercial and residential purposes.

“Billing is not speaking to what is on the ground, those not receiving utilities are being billed. Parking marshals’ approach is dreary for business and it is a concern for business,” Ncube said.