Harare (New Ziana) – In a positive marker for the Second Republic’s parastatal reform programme, the state owned Industrial Development Corporation (IDC) on Wednesday declared a ZW$15 million dividend to its shareholder, the first time it has done so in over a decade.
Receiving the dividend, President Emmerson Mnangagwa said public entities were expected to drive economic growth, through providing high quality and affordable goods and services.
As such, he said poor performance in public entities would not be tolerated highlighting that parastatals were not established to be cost centres requiring constant bail-outs and capital injections from government.
“Under the Second Republic’s whole of government approach, state-owned enterprises must stand on their own two feet as opposed to being a perpetual burden to the fiscus. The non-payment of taxes, rates, fines and other statutory obligations should now be a thing of the past,” he said.
“The payment of a dividend by the Industrial Development Corporation should inspire other state owned enterprises to follow suit. The time has come for parastatals to grow the economy by meaningfully contributing to the country’s GDP, fiscus and job creation. After all, state controlled entities are obligated by section 195 of our national constitution to be profitable and viable.”
President Mnangagwa added; “As we accelerate our quest to achieve a prosperous and empowered upper-middle income economy by 2030, the issuance of dividends by state-owned enterprises must therefore be the norm and not an exception.”
President Mnangagwa said transparency and accountability were also key to the revival of public entities.
“The culture of flimsy excuses for breaching statutory requirements with regards the disclosure of financial and non-financial information must stop forthwith. Inefficiencies in the operations of state-owned enterprises as well as malfeasance such as nepotism and opaque personnel management practices must be a thing of the past.”
Meanwhile, President Mnangagwa also launched new cotton and livestock dipping pesticides, innovations of the Chemplex Corporation, a subsidiary of the IDC.
President Mnangagwa said the cotton pesticide would help improve yields while that for livestock would spur efforts to grow the national herd.
“I challenge Chemplex Corporation to remain alive to the fact that producing products is not an end in itself. It is imperative that these products are available to farmers at affordable prices through the most convenient distribution channels across the country,” he said.
Speaking at the same event, Industry and Commerce Minister Dr Sekai Nzenza said the innovations were in line with government’s local content strategy.
“This is a milestone towards import substitution as the country has been carrying an expenditure burden on importing these products,” she said.
The IDC has under its portfolio companies involved in mining, and the chemical and agro-industry.
But, its companies have experienced viability challenges over the years chiefly because of antiquated machinery, and inadequate working capital.