Business urged to take advantage of human capital

9 June 2010

The Herald Business
Business News

The business sector has been encouraged to put in place appropriate strategies to assist skills development in order to benefit from the anticipated growth of African economies over the next two decades.

Speaking at a recent Zimbabwe Institute of Management event, TA Holdings executive chairman, Mr Shingi Mutasa said Zimbabwean business should capitalise on the country’s human capital, which is one of its biggest assets to ensure that national growth targets are met.

“Over the next 20 to 30 years Africa could emerge as a reasonably important contributor to the Gross Domestic Product of the world economy. Today Africa has around 20 percent of the global population but contributes less than two percent of the global GDP.

“However, over the next 30 years it is anticipated to change to at least 10 to 15 percent of global GDP. It is this growth trajectory that we should strategise and plan for. Zimbabwe is blessed with the most critical resource of all – its human capital.

“Unlike the rest of Africa, which has a significant population base that is largely unproductive human capital, we have a strong mass of educated people. We have a strong comparative advantage, let us use it regionally and continentally to achieve this significant growth,” said Mr Mutasa.

Zimbabwe has of late failed to maximise on its skilled human resources due to undercapitalisation of most industries, which have been worsened by the liquidity crisis.

Capacity utilisation by the local industries has stagnated at just over 30 percent this year.

The TA boss predicted that Zimbabwe would soon be the fastest growing economy on the continent, basing on the skills advantage that the country has over its African counterparts.

“Our role in the economic future of Africa is very significant, if, we choose to be actors on the stage. I strongly believe that Africa over the next 10 to 15 years will have the largest GDP compounded growth rates in comparison to other continents. More importantly, Zimbabwe will over the same period be the fastest growing economy in Africa.

“The strength of my conviction is not based on the untold mineral wealth of Zimbabwe not the diamond fields of Chiadzwa or the incredible wealth stored in the Great Dyke. Neither is it based on the great infrastructure that is second only to that of South Africa.

“It is because of the human capital that is our distinguishing comparative advantage. Our most critical asset is our human capital, we must aggressively invest in it,” he said.

Despite Zimbabwe’s extensive skills base, many companies have been trying to downsize through retrenchments as a result of the liquidity situation in the local market so as to meet their capital requirements. But economic experts contend that this strategy is both short-term and superficial and will not lead to sustained economic growth.

Mr Mutasa also said that as business they were not ignorant of the problems facing the Inclusive Government or the impact of negative sentiments and misinterpretations on the country’s indigenisation and empowerment drive. He called upon the industry to play a pro-active role.

“Let me state clearly that I am not blind to the challenges of the Inclusive Government, neither do I limit the impact of bad interpretation, both locally and internationally to the intent of indigenisation.

“These are all factors that we as business leaders and professionals must factor in when we plan. What we must stop doing is having a strategy of ‘wait and see’. For me this is an abrogation of responsibility. This stage is set of proactive players,” said Mr Mutasa.

- Business Reporter