Business Unusual

The twilight of 2014 is nigh and we can only look back and see how we got things done. There is a lot to talk about. Opportunities gained, missed and likewise fortunes of different magnitudes. Dreams and hopes achieved or messed and if you are such a business person the focus is on what to do in 2015.

We had a year of massive political campaigns and Malawians stuck to their peace despite electoral controversies. Peace prevailed and that is the cardinal belief of this column if businesses are to strive, workers fell safe. Is there anything unusual that one has to do? The president promised business unusual in his approach and I tempted to think he has lived to it.

No matter how you view him but I like t think that APM is a different person. That makes it business unusual? I don’t know but my recollection of this approach is that it filters through to all that deal with government in many ways. We are all as citizens as we express our different rights.

One major economic event of the year has been the depreciation of the Malawi kwacha by a cool 50 percent. It sent waves of fear and the different schools of speculation got most of us scared. Memories of fuel shortages and particularly visual images of petrol stations are not distant. You had the right to fear but it appeared we have weathered the storm carefully but the road remains bumpy. Was this a scenario of business unusual?

I can add a few lines to a story that is too common whenever the kwacha loses some kudos. Business captains usually lead the furore to think that government is not doing enough to save the currency or provide an enabling environment. There is some merit but one needs to minimise the economics of the tongue. It is a usual business. I brand it that way.

Capital Hill does not own any farm and factory. The few businesses it owns include the mighty Escom, Water Boards, airspace, roads and the rest are public institutions that serve the nation are zero cost. This does not bring any foreign exchange. Capital Hill sold many assets through privatisation to entrepreneurs who, for a variety of reasons, still reckon business is getting government contracts.

This does not bring you any foreign exchange and, therefore, relinquishes any right to blame it, including Reserve Bank of Malawi for any loss in the value of the kwacha. The business of government is not exporting goods and services, even though there might be some little revenue out of such operations. If anything Capital Hill has made attempts to get our private sector to export through numerous trade agreements.

Some few years ago we had free trade agreements with South Africa on conditions that we export local materials but it appears some clever businesses opted to break the rules of origin and we lost it. The Agoa Act never lived to its expectation because local companies failed to meet orders. You don’t ship one container of textiles and expect to compete with ruthless Bangladesh or Vietnam. But could we blame the Malawi Government for this? Not at all. They don’t own any textile company.

These are just some examples of many that sometimes lead us to blame everything on government. As we start 2015, I reckon it is time that the Malawian private sector raise their game and think outside the box. It should be business unusual and be willing to venture into external markets by taking more risk and expanding their production.

The export market can be tough but requires good quality products and large volumes. Our players must raise their game. While the cost of capital is high, there are any alternatives to raise capital. The Malawi Stock Exchange has had no listing for some years but remains a cheaper source to raise capital in the wake of prohibitive interest rates. But guess what? The stock market comes with commitment to transparency in doing business, good corporate governance practices that our private sector is very much apprehensive about.

This is where an element of doing business unusual is required as we start 2015 and explore further opportunities that have been identified in the investment compendium unveiled a couple of weeks ago. So, let us not always blame the government whenever forex is limited in the bank. Water-boards don’t generate foreign exchange and, sadly, we have left everything in the hands of tobacco farmers that cultivate their fields using wooden hoes to bring the much needed green-bucks.

If anything, what we should be asking government is to tighten security, ensure adequate supply of electricity and water, good roads and efficient delivery of services that support businesses. The events of the past three weeks in the realm of security have not been encouraging and this is the stuff we have to hold leaders accountable, but not piling forex shortages blame on Capital Hill. That is the role of exporters, not Capital Hill.

So bring 2015 and let each one of us do some business in manners unusual. Otherwise, I wish all followers and readers of this column a prosperous 2015. Your numerous feedback and insights have made this column survive the effects of the kwacha depreciation.