Jaggers and Lobels closure, indigenisation not to blame: AAG
HARARE – The Zanu PF linked black economic empowerment lobby group the Affirmative Action Group (AAG) says the closure of Lobels Bakery and Jaggers Wholesalers should not be blamed on indigenisation as local companies are facing liquidity challenges.
Lobels recently suspended operations, facing huge debts, while Jaggers Wholesalers also folded and this has given some quarters opposed to the indigenisation and empowerment drive mileage in opposing the policy.
Lobels was sold to a consortium of black businesspeople comprising Livingstone Gwata, Frederick Mtanda, Herbert Nkala and retired Brigadier General David Chiweza.
Jaggers is now owned by businessman, Mr Cecil Muderede, who gained a controlling stake after buying out the previous major shareholder, a South African company, Metcash Africa.
However AAG Executive Director, Dr Davison Gomo said this takeover of the companies cannot be attributed to their folding.
He said many local companies are operating under difficult conditions and sanctions induced challenges are affecting most businesses in the country.
“I do not think people should read much into what has become of Lobels and indeed problems that have beset Jaggers. A lot of recapitalisation required, a lot of money and that is the missing link. Where are you going to get the money with the challenge facing banks? It is therefore extremely difficult to generalise and blame it on the indigenisation policy,” said Dr Gomo.
Liquidity challenges facing the country and lack of access to credit lines has negatively affected the revival of local industry, forcing several firms to scale down operations and in worst cases close shop.