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opportunities worth US$2 billion annually from contracts to supply inputs and services to key sectors of the economy.
The manufacturing sector alone could empower locals to the tune of US$880 million per year.

This is under his proposed Supply and Distribution Indigenisation and Empowerment (SaDIE) model.
In a supplement to the monetary policy statement dubbed “A Sectoral Approach to Economic Empowerment and Indigenisation”, Dr Gono proposed SaDIE as an effective framework through which empowerment could be attained expeditiously. He stressed that under it, companies could ensure that at least 75 percent of raw materials and other goods and services required by industry are supplied by locals.

Based on the 2011 potential Gross Domestic Product of US$8,6 billion, he said opportunities were abundant for indigenous people to actively participate in this, as part of the indigenisation and economic drive that has seized the economy, particularly in the last two years.
“Lucrative empowerment opportunities are abound in the key sectors of the Zimbabwean economy, notably manufacturing, mining, construction, tourism, retail, distribution, transport, telecommunications, financial and the public sectors,” said Dr Gono.

The manufacturing sector presently contributes 18 percent to GDP, with a potential to grow to 20 percent. This sector is made up of such sub-sectors as foodstuffs, tobacco and beverages, paper printing and publishing and chemical and petroleum products, among others from which local suppliers could benefit.
“A deliberate policy can be put in place to support indigenous people in the procurement of raw materials and inputs to the manufacturing industry” he said.

Procurement guidelines would be critical to ensure indigenous-owned companies met acceptable minimum quality standards demanded by the different sub-sectors.
Furthermore, indigenous people could secure business opportunities estimated at about US$550 million per year in the mining sector for the supply of inputs and services.
The input and spares category contributes 53 percent of total costs in mining production, a proportion that could be targeted to empower local people.

Mining contributes 12 percent to GDP. The sector is capital intensive.
In construction, tourism and other sectors, indigenous people could be allocated the bulk of tenders to supply requirements.
Government could also emerge as a major payer in the matrix through allocating contracts to indigenous people.

“A significant quota should be reserved for the indigenous people in the area of service provision, under the 26 percent slice for Government operations.
“This requires that Government minimises outsourcing of service provision to foreign-owned businesses and prioritises competent indigenous providers,” said Dr Gono.

Where capacity was limited, strategic partnerships between existing foreign-owned companies and local firms could be fostered to strengthen local expertise and ability.
“The SaDIE Model empowers indigenous people in a way that gives them dignity, improves their basic welfare and reduces poverty in line with the Millennium Development Goals while extending beneficial mileage to the majority of the people,” he said.

“Rather than concentrate on equity-type approach on a large and non-discriminatory scale, the SaDIE approach begins at, or with, the start of the economic cake itself, by requiring that at least 75 percent of industrial procurements are reserved for indigenous people or indigenous-owned companies.” .

Current non-indigenous deals could be given over to local people without compromising on price competitiveness, quality specifications, delivery times and other criteria demanded by firms, parastatals, local authorities, Government departments and ministries.

This programme could be supported by mentorship programmes and smart partnership arrangements where there could be skills shortcomings on the part of the indigenous people.
With funding being a major constraint to most indigenous entrepreneurs, the SaDIE model could address this challenge.

“Banks are more likely to lend to a group of people or individuals who are accredited suppliers of say, Zimplats, with the understanding that they will get paid by stop-order directly from the beneficiary company,” Dr Gono said.

“This allows them to securitise that relationship, thereby obviating the need for primary security from the individual or group of individuals who do not have any collateral.”

The model would ensure that local people benefit from immediate receipts from guaranteed supply of goods and services as opposed to waiting for annual dividend payments which were contingent upon the companies making profits and declaring such dividends to shareholders.