|Think outside the box, businesses urged|
|Friday, 29 June 2012 11:27|
Fanuel Kangondo in Victoria FallsLocal businesses have been urged to think outside the box and consider other sources of raising funds to recapitalise their enterprises as the traditional funders such as banking institutions are failing to support their operations.
TN Holdings chief executive Mr Tawanda Nyambirai told the Zimbabwe National Chamber of Commerce annual congress that opened in Victoria Falls on Wednesday that it was time to be innovative and consider raising funds from social and religious networks and pool their resources to fill the void caused by the liquidity challenges facing the economy.
In a presentation entitled “Accessing Re-finance for Financially Distressed Enterprises”, Mr Nyambirai — who also owns a commercial bank — said local banks could not easily come up with facilities to bail out companies in distress.
“As an economy we continue experiencing liquidity challenges emanating from an array of problems compounded by the lack of a banker of the last resort. What this means is that after the Government has collected revenue, it is supposed to go to the Reserve Bank of Zimbabwe as the banker to Government.
“Unfortunately, we do not have such a properly managed structure and that is the reason why facilities for distressed companies offered by banks remain expensive.”
they would have contributed was their money that could be lent to struggling businesses with a portion going for the upkeep of ‘the man of God’.
Mr Nyambirai said this concept could easily be spread out to various congregations around the country and bring the much desired relief to the many distressed companies that continue to cry out to the formal banking sector.
He said such funds would not only be available to distressed companies, but also other enterprising individuals that were failing to get affordable finance to start businesses.
He also called for the development of more efficient cost models to help local manufacturers to remain competitive in the face of cheap imports, particularly from the East.
“We are expected to compete against such companies from countries whose legislation supports their production systems. Our labour laws here are so rigid and as
members of the International Labour Organisation, we are expected to meet the minimum labour standards.
The TN Holdings boss suggested the use of prison labour as a way of reducing labour costs for companies in distress as labour constituted a large portion of production costs.