Friday, 15^th June, 2018

 

The House met at 0900 hours

 

[MR SPEAKER in the Chair]

 

NATIONAL ANTHEM

 

PRAYER

 

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BUSINESS OF THE HOUSE

 

The Chief Whip and Leader of Government Business in the House (Mr Chungu): Mr Speaker, I rise to give the House an indication of the Business it will consider next week.

 

Sir, on Tuesday, 19^th June, 2018, the Business of the House will begin with Questions for Oral Answer. This will be followed by presentation of Government Bills, if there will be any. Thereafter, the House will debate the Motion to adopt the Main Report of the Budget Committee.

 

Mr Speaker, on Wednesday, 20^th June, 2018, the Business of the House will start with Questions for Oral Answer. Then, the House will consider Private Members’ Motions, if there will be any. This will be followed by presentation of Government Bills if there will any. Thereafter, the House will debate the Motion to adopt the Report of the Committee on Agriculture, Lands and Natural Resources.

 

Sir, on Thursday, 21^st June, 2018, the Business of the House will begin with Questions for Oral Answer. This will be followed by presentation of Government Bills, if there will be any. The House will then debate the Motion to adopt the Report of the Committee on Energy, Water Development and Tourism.

 

Mr Speaker, on Friday, 22^nd June 2018, the Business of the House will commence with the Vice-President’s Question Time. Thereafter, the House will consider Questions for Oral Answer. This will be followed by presentation of Government Bills if there will any. The House will then debate the Motion to adopt the Report of the Committee on Government Assurances.

 

I thank you, Sir.

 

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QUESTION FOR ORAL ANSWER

 

EXPANSION OF THE NDOLA TEACHING HOSPITAL AND ARTHUR DAVISON HOSPITAL

 

278. Mr Mulenga (Ndola Central) asked the Minister of Health:

 

1. when the expansion of the Ndola Teaching Hospital and Arthur Davison Children’s Hospital will commence;

 

1. what has caused the delay in commencing the project;

 

1. who the contractor for the project is;

 

1. what the estimated cost of the project is; and

 

1. what the timeframe for completing the project is.

 

The Minister of Health (Dr Chilufya): Mr Speaker, I wish to inform the House that the Government has no immediate plans to expand Ndola Teaching Hospital and Arthur Davison Children’s Hospital. However, the Government has embarked on a hospital modernisation programme in order to provide modern and specialised services to the people of Zambia. The Programme includes improvement in the current infrastructure at the two hospitals, deployment of specialised human resource and provision of equipment.

 

Sir, Ndola Teaching Hospital and Arthur Davison Children’s Hospital have already benefited from this programme through the provision of state-of-the-art equipment and specialised personnel. Further, there is a 120-bed capacity, modern Psychiatric Unit, which is being constructed by Jeremy Enterprises Limited adjacent to Ndola Central Hospital. The focus at the moment is to improve services rather than expand the infrastructure and this shall be carried out through provision of equipment and deployment specialised personnel.

 

Mr Speaker, in light of the above information, (b), (c), (d) and (e) fall off.

 

Mr Speaker, I thank you.

 

Mr Mulenga: Mr Speaker, I would like to thank the hon. Minister for the answer.

 

Sir, during the presentation of the 2016/17 National Budget, the then hon. Minister of Finance, Mr Felix Mutati, indicated that there would be an expansion of Arthur Davison Children’s Hospital and Ndola Teaching Hospital. Could he kindly explain to the people of Ndola whether this plan has changed or why the Government had decided to cancel and instead, replace it with the improvement of equipment and deployment of human resource?

 

Dr Chilufya: Mr Speaker, the clarification from the Government is that, the intention was to modernise Ndola Central Hospital and Arthur Davison Children’s Hospital as part of the robust agenda to improve health systems. Instead of expanding the existing infrastructure at the Ndola and Arthur Davison hospitals, the Government opted to create more infrastructures in densely populated places within Ndola. Therefore, this will reduce congestion at the two hospitals. Therefore, Mushili, Chipulukusu and Kabushi and other few densely populated places will benefit from the peripheral facilities because that is the best way to improve service delivery at the two hospitals.

 

Sir, modernisation includes the improvement of the current infrastructure and patient flow systems. So far, Ndola is standing out as the best hospital going by what the medical personnel are doing there.

 

Speaker, I thank you. 

 

Mr Livune (Katombola): Mr Speaker, with your favourable approbation, allow me to solicit a bonus answer from the hon. Minister, especially that he mentioned that the focus of the Government is to provide health care to all the people of Zambia.

 

Sir, we have a number of district hospitals that are completed and are waiting to be opened such as Kazungula District Hospital. May I know when it will be opened with your favourable approbation?

 

Mr Speaker: You know that you are violating the rules.

 

Laughter

 

Dr Chilufya: Mr Speaker, I would like to thank the hon. Member of Parliament for confessing that actually, the Government is building infrastructure in districts as opposed to his position a few days ago.

 

Sir, Kazungula District Hospital is a modern facility, which has been built by the Government and the infrastructure is complete and we have completed the procurement process for equipment. Therefore, within the month of July, the state-of-the-art equipment will be put in place. Human resource is already deployed to theSouthern Province and they are, at the moment, providing service in other hospitals. Therefore, we hope to operationalise Kazungula District Hospital by the end of July this year.

 

Mr Speaker, I thank you. 

 

Mr C. M. Zulu (Luangeni): Mr Speaker, what does it take for a central hospital to be called a teaching hospital?

 

Dr Chilufya: Mr Speaker, all central hospitals are teaching hospitals. A teaching hospital is basically a facility with staff that will provide professorial and clinical services. These hospitals have adequate caseloads and a certain range of services that are provided across various specialties. These are the hospitals we use to train doctors, nurses and other paramedical staff. A central hospital is basically a teaching hospital and, therefore, the two are the same in the current context.

 

Mr Speaker, I thank you.

 

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MOTIONS

 

REPORT OF THE COMMITTEE ON NATIONAL ECONOMY, TRADE AND LABOUR MATTERS

 

Dr Musokotwane (Liuwa): Mr Speaker, I beg to move that the House do adopt the Report of the Committee on National Economy, Trade and Labour Matters for the Second Session of the Twelfth National Assembly, laid on the Table of the House on 11^th June, 2018.

 

Mr Speaker: In the Motion seconded?

 

Mr Chali (Nchanga): Mr Speaker, I beg to second the Motion.

 

Dr Musokotwane: Sir, in line with its terms of reference, your Committee considered the role of the Macro, Small and Medium Enterprises (MSMEs) in national development in Zambia. Your Committee is aware, through its interaction with officials from relevant ministries, that the Government has been implementing various strategies and interventions which are meant to boost the operations of the MSMEs. Regrettably, despite all these well intended efforts, the performance of the MSMEs in Zambia is still unsatisfactory. I now highlight some of the findings of your Committee which may explain, in part, the reasons for the lackluster performance by the MSMEs.

 

From the outset, let me state that the MSMEs account for about 98 per cent of Zambian enterprises, of which the majority are not formalised. However, even though the MSME sector in Zambia has great potential to contribute to national development, the sector only contributes 2 per cent to the Gross Domestic Product (GDP). Your Committee is also concerned about the inadequate data regarding the business activities of the MSMEs, including their contribution to other sectors of the economy. This makes it very difficult to assess the impact of this sector and also to clearly present their actual level of contribution to the country’s economic growth and development.

 

Sir, your Committee wishes to express its serious concern regarding the existing policy inconsistency between the Ministry of Commerce, Trade and Industry and other Government agencies.

 

Mr Livune: Hear, hear!

 

Dr Musokotwane: While the ministry has put in place strategies aimed at reducing the cost of doing business, other agencies want to maximise revenue collection through imposition and collection of various levies. Your Committee further observes that the requirements to register an MSME are numerous and can be onerous. This, in turn, discourages formalisation of most of them.

 

Your Committee, therefore, strongly recommends that all Government agencies must harmonise their policies to create an enabling environment for the MSMEs in order to allow them to conduct business at a minimum cost.

 

Mr Speaker, your Committee is concerned that while the prices of copper on the international market have been fairly good, the benefits accruing to the mining companies from these good prices are not being shared with the local MSMEs through the creation of business opportunities for them. Your Committee is aware that most of the mines are importing items that can easily be produced locally by the MSMEs.

 

In this regard, your Committee urges the Government to strengthen the linkages between local suppliers and the mining companies by compelling the latter to reserve a prescribed threshold of their procurements for the suppliers.

 

Mr Speaker, related to this, your Committee also observes that the Government is in the habit of importing items which are readily available on the local market. Your Committee is of the view that this practice is detrimental to the local MSMEs who, in most cases, lack markets for their products. Your Committee urges the Government to adopt a deliberate policy of creating a market for the MSMEs by procuring most items locally.

 

Mr Speaker, your Committee was also privileged to undertake local tours to the Southern and Western Provinces. The tours provided an opportunity for your Committee to have first hand information regarding the reasons for failure by the MSMEs to effectively contribute to national development and, indeed, appreciate any other challenges that the sector is experiencing. It is the hope of your Committee that its findings will give the House an idea of the problems most of the MSMEs in the country are facing and that the recommendations made by your Committee will help to resolve some of these challenges.

 

Sir, in the timber industry, the tour revealed that the frequent bans on timber movement by the Government had serious implications on the operations of the MSMEs. Your Committee is of the view that the problems facing the sector can be mitigated without necessarily banning timber movement. In light of this, your Committee strongly recommends that the Government should completely stop the ban on timber movement to allow the timber industry to thrive and foster diversification.

 

Mr Speaker, lastly, but not the least, allow me to express your Committee’s displeasure regarding the quality of responses coming from the Executive in the Action-Taken Report. Your Committee sadly notes that because of the unsatisfactory responses, the Action-Taken Report still has outstanding issues from as far back as the First Session of the Eleventh National Assembly. In this regard, your Committee strongly recommends that the Government should treat recommendations made by your Committees and the resolutions of this House seriously and not just take them lightly. If this unacceptable situation is allowed to continue, your Committee’s work and other Committees’s work and recommendations will be rendered academic with no real value.

 

Mr Speaker, in conclusion, your Committee wishes to thank the Office of the Clerk of the National Assembly for the support rendered to it throughout its deliberations. It is indebted to all the stakeholders who appeared before it for their co-operation in providing the necessary information. Finally, let me also add that your Committee is grateful for your invaluable guidance throughout the session.

 

Mr Speaker, I beg to move.

 

Mr Livune: Hear, hear!

 

Mr Speaker: Does the seconder wish to speak now or later?

 

Mr Chali: Now, Mr Speaker. 

 

Mr Speaker, in seconding the Motion, which has been ably moved by the Chairperson of your Committee, I would like to highlight a few issues which were not covered in the Chairperson’s remarks.

 

Sir, your Committee observed that limited financing is one of the major factors negatively affecting the performance of the MSMEs sector in Zambia. In fact, this challenge has been exacerbated by the lack of collateral among many MSMEs, especially those in rural areas, thereby making it difficult for them to access credit. Further, financial institutions are not willing to extend credit to the MSMEs because they are generally perceived to be risky. This has led to most MSMEs resorting to accessing credit from risky, informal lending channels with exorbitant interest rates. In this regard, your Committee recommends that in order to facilitate growth in credit to the MSMEs, the Government should expeditiously operationalise the Zambia Credit Guarantee Scheme ...

 

Mr Lufuma: Hear, hear!

 

Mr Chali: ... to promote affordable finance for the MSMEs. It further recommends that the Central Bank operationalises various tools at its disposal, including engaging the commercial banks through moral suasion, to reduce the lending rates, not least that the inflation rate in the recent past has been contained within a single digit.

 

Mr Speaker, your Committee is concerned that the current policy on the MSMEs is outdated and, therefore, does not effectively address the current challenges facing the sector. In light of this, your Committee strongly urges the Government to prioritise the revision of the Micro, Small Medium Enterprise Development Policy to ensure that the policy contributes to the creation of an enabling business environment.

 

Sir, during its local tours, your Committee observed with concern that the MSMEs in the milling industry received minimal supply of maize and in some instances, none at all. This is largely due to the existing bureaucracy at the local Food Reserve Agency (FRA) offices which frustrates most MSMEs. The requirement by the FRA that the MSMEs deposit money into the account for the FRA and courier the deposit slip to Lusaka, pending authorisation, leads to the maize taking long to be released to the millers. Your Committee is of the view that the FRA should facilitate the growth of the MSMEs in the milling industry by expediting the release of maize considering that the mealie meal market is readily available in the country.

 

Mr Speaker, your Committee also observes that the cashew infrastructure development project being implemented in the Western Province, funded by the African Development Bank (AfDB) and the Zambian Government is coming to an end in 2021. Your Committee, however, sadly noted that only about 10 per cent of the funding has been utilised and the project is in its third year of the planned five years. Your Committee recommends that if the project is to meet its objective of improving household incomes through improved cashew production and processing, the Government should review the performance of the project and expedite the implementation of the project. The Government should also consider extending the project period in order for the small scale cashew growers to obtain the full benefits of the project.

 

Mr Speaker, your Committee observes that there has been an increase of cheap Chinese timber imports on the Zambian market, therefore, the local timber products cannot compete favourably thereby reducing the market share of Zambian timber products. Your Committee, therefore, urges the Zambia Bureau of Standards (ZABS) to strengthen and enforce the standards of timber products and ensure that they, at least, meet the acceptable standard. This will, to a large extent, sustain the local timber industry.

 

Sir, last but not least, your Committee observed that the Zambia Chamber of Commerce and Industry is facing challenges in promoting entrepreneurship and co-ordinating its members largely due to weak linkages between local chambers and the MSMEs and as such, most MSMEs do not see the benefit of affiliating to the local chambers. Your Committee recommends that the operations of the Zambia Chamber of Commerce and Industry be governed by legislation which should, to a large extent, attract business enterprises to affiliate to their local chambers of commerce.

 

Sir, in conclusion, allow me to thank my fellow members of your Committee for affording me the opportunity to second the Motion.

 

Mr Speaker, I thank you.

 

Mr Bwalya (Lupososhi): Mr Speaker, thank you for giving me an opportunity to support your Committee’s report. From the outset, let me say that the wonderful people of Lupososhi Constituency support this report.

 

Mr Speaker, in supporting this report, I have a few issues and concerns regarding the financing of the MSMEs in this country. Access to finance in Zambia is very difficult because of various reasons. One reason is the high interest rates and the requirement of collateral, as the seconder of the Motion mentioned. If my memory serves me well, I recall that this august House discussed and passed a law on using movable assets to access finances from financial institutions. I would love the hon. Minister of Commerce, Trade and Industry and his counterpart, the hon. Minister of Finance to shed more light on how far we have gone in using movable assets to access finances.

 

Mr Speaker, we also need to analyse the cost structure and know why Zambia has high interest rates. The high interest rate is inhibiting the MSMEs from accessing finances.

 

Mr Speaker, I have said before that it is possible for this country to be innovative. We should look at the qualifications of the people who set up the MSMEs. Some of them are quite learned and are very qualified. Their qualifications came at a great cost. Why is it not possible for us to enable someone to use the qualification they earned over a long time as collateral to access finances?

 

For instance, we all know how long it takes for a person to acquire Association of Chartere Certified Accountants (ACCA). It should be possible for someone with such a qualification to access financing, so that in an event of their failing to pay back the money, they should lose their qualification. This is an innovative way of allowing and giving the citizens of a particular country access to finances and thereby helping in the creation of jobs, which jobs we really need as a country. Mr Speaker, my suggestion would be that technocrats in the ministry responsible for trade and industry, the Ministry of Finance and the ministry responsible for economic affairs must look at all these other aspects and find ways of ensuring that the Zambian people access financing easily and cheaply.

 

I thank you, Sir.

 

Dr Chanda (Bwana Mkubwa): Mr Speaker, thank you for giving me this opportunity to add the voice of the people of Bwana Mkubwa Parliamentary Constituency in support of your Committee’s report. We must realise that the greatest creator of jobs in an economy like ours, as well as developed economies, is always the MSMEs. It is not the large multi-national companies that create the most jobs. We should also know that the largest companies that we know today started as MSMEs. They grow from being small to big companies. It is just like a child that is born; it starts growing until it reaches a certain age. That is why we have seen countries all over the world going towards protectionism because we all need to protect what is called the infant industry theory. The MSMEs must be nurtured until they become multi-nationals.

 

Sir, about three weeks ago, I was very happy to see Avic International in Lusaka, signing an agreement with about sixteen of our local contractors. I would like to emphasise that the Government needs to promote such partnerships and co-operations with foreign entities mainly for two reasons which are financial transfer and skills transfer. That way, we will, in future, make all these big multi-nationals working on major projects irrelevant. What we want is for the MSMEs to grow to an extent where they can also be engaged to construct roads in other countries in the Southern African Development Community (SADC) and Common Market for Eastern and Southern Africa (COMESA) regions, especially now that we are moving towards the Pan-African Trade Agreement which is a US $2 trillion market. That is why when we talk about nurturing the MSMEs, we must be futuristic.

 

Mr Speaker, secondly, I would like to emphasise that having a trade policy in Zambia is long overdue. We have been talking about this and we have seen at a global stage, where big countries are having trade woes. The United States of America (USA) with its partners like Mexico, Canada and China, is like everyone else, putting trade tariffs as a way of protecting its territory. Zambia also needs to do that because without a national trade policy, we are a dumping ground for imports. We will keep complaining about how things like tooth picks are brought into the country. The other day, a friend of mine in the USA sent me a picture of a company packaging ifinkubala or caterpillars. The USA based company has packaged the caterpillars and labelled them Healthy Organic Mopane Worms from Southern Africa, Zambia in particular. They are labelled healthy because we are living in an era of non-communicable diseases. If we are going to have the British packaging ifinkubala which they get from here in their raw form and export them to other countries, we will be losing money even in natural things such as these. That is why I want to urge the Government to bring the National Trade Policy as a way of supporting the MSMEs.

 

Sir, we need to realise that trade is war. When it comes to trade, countries fight. Historically, some countries have gone to war because of trade and land. We should not have a laissez-faire attitude towards trade or allow a situation where the MSMEs are suffocated by the multi-national companies. We can deal with multi-national companies, but let it be conditional. We should enter into partnerships. Look at what Botswana has done in the mining sector. The Botswana Government started as a minority shareholder with Anglo-America being the major shareholder. However, the Botswana Government has, over the years, grown to become the majority shareholder in the diamond company. That is why the diamond region is working to the benefit of Botswana. Therefore, there are a lot of lessons to learn from, in order to prop up our economy.

 

Mr Speaker, with those few words, I thank you.

 

Mr Lufuma (Kabompo): Mr Speaker, thank you for giving me this opportunity to contribute to the debate on your Committee’s report. From the outset, I would like to say that I support the report because it brings out pertinent issues which the Government should try to address if the MSMEs are going to contribute substantially to the country’s Gross Domestic Product (GDP).

 

Sir, facts indicate that 98 per cent of Zambian enterprises comprise the MSMEs. However, despite this big number, they only contribute 2 per cent to the GDP. Obviously, there must be a problem. The MSMEs must have challenges that are inhibiting them from contributing to the growth of the GDP. Clearly, one of the items, which is very essential and has already been mentioned, is finance. Without finance, nothing can be done. These MSMEs will not grow and, therefore, will not contribute to the country’s GDP. This is one area that the Government should concentrate on. My colleague there has mentioned, -

 

Interruptions

 

Mr Speaker: Order!

 

The conversations on the right are rather loud. You may continue, hon. Member.

 

Mr Lufuma: Mr Speaker, my colleague there has mentioned that the inhibiting factors in this sector in terms of finances are the high interest rates. High interest rates are basically brought about by the fact that money supply in the economy is very low. In other words, the Government is using a lot of money or sweeping money from commercial banks to various projects which are at various levels. As a result, the money supply becomes low while demand increases and so the interest rates are high. This cannot be afforded by the MSMEs. Given that fact, what is the Government supposed to do?

 

Sir, I would like to refer this august House to India, which is a very good example of a country that has grown. Right now, its GDP is around 10 per cent. It has grown because of the MSMEs which it has supported in terms of finance? If it was possible there would have been to be a revival of a specific bank. This bank should be set up to assist the small-scale enterprises. We used to have a bank called Small Enterprises Development Bank (SEDB) which is no more. It is incumbent upon the Government, if it is going to support the small scale enterprises, to revive this bank so that it specifically gives loans to small-scale enterprises at low rates. The rates should be as low as 8 or 10 per cent. That will assist the MSMEs. In terms of interest rates, the Government might lose out, but it will gain mass contribution to the GDP, which is what we are looking for. Apart from that, once the MSMEs grow, the employment situation in the country will also change. There will be more money in people’s pockets. The MSMEs will be supporting the Patriotic Front (PF) Government Manifesto by putting more money in people’s pockets. That is essential.

 

My contribution is to encourage the Government to set up specific banks which will look into financing the MSMEs. It should not be left to a small corner of the Development Bank of Zambia (DBZ), where the MSMEs must go and access these funds. They will not go there because it is too complicated. Therefore, the Government should ensure that the establishment of this bank is looked into and, if possible, revived.

 

Apart from that, in the past, there was the Small Enterprises Development Organisation. I think this was an idea which came from India. The MSMEs in this sector will need training because the quality of goods is very important. Nobody would like to buy goods that are sub-standard.

 

In the past, the Small Enterprises Development Organisation, which I believe should be revived, helped the MSMEs to get the necessary training and information on technology that can improve quality. This organisation assisted the MSMEs to import technology into the country in order to improve the quality of the products they produced. This organisation should be looked into and revived if possible because it will help in terms of technology transfer and training. This will, in turn, improve the quality of the products on the Zambian market. In other words, we will be able to compete favourably with the cheap items that come from China. People want quality and the quality of most Chinese products leaves much to be desired. The Government should try to work to encourage the MSMEs to grow and contribute more than 2 per cent to the GDP.

 

Mr Speaker, the other item I want to discuss is the 20 per cent share of major road contracts which should go to the MSMEs. This is a brilliant idea which should be supported. There should be mechanisms to ensure that the MSMEs that get the 20 per cent do not just get it on paper. They should be seen to be doing the work on the ground that they have been contracted to do. If they do not do the work that they have been contracted to do, then there will be no improvement in terms of work ethic, technology transfer and the like. It is important that this is properly monitored and enforced. Zambians should utilise the 20 per cent on the projects that have been given.

 

Apart from that, we have noticed that the 20 per cent is given in a politically inclined manner. The Government might object, but a lot of the MSMEs that are being given the contracts are owned by the PF cadres who are not capable of doing the job.

 

Hon. Opposition Members: Hear, hear!

 

Mr Lufuma: These companies are not performing, but because they are politically connected, they get away without doing the jobs. This is not helping the economy or the country. We should be serious and give contracts to the MSMEs that are capable of doing the job and then, they will contribute to the GDP and employment figures, poverty levels and inequality in terms of income distribution will improve. If we are non-partisan, we will spread these contracts across the country. As long as the Government is going to be partisan and give the 20 per cent contracts to cadres, this country will not develop.

 

Mr Speaker, the MSMEs by their nature are afraid of filling out forms and going to offices. These things should be simplified. If the Small Enterprises Development Organisation is to be formed, it will be simple for the MSMEs to go straight to its offices and register. We should not have too many formalities such as payment of fees to multiple ministries because it discourages a lot of the MSMEs. We should have a one-stop organisation which can co-ordinate all these things. If this was done, it would be easy for the MSMEs to register after which it would be easy to follow them up, tax them and get the necessary money in terms of domestic mobilisation of income, which is going to help the country.

 

Leaving it open and expecting the MSMEs to go to various ministries, councils and the Zambia Revenue Authority (ZRA) will be a bit too much for most of them. As a result, they will not be able to register and we will not be able to tax them. Taxing them will assist the country in raising revenue to fund a lot of these half-baked projects that are not being completed in the newly formed districts as we heard yesterday. This is the potential that exists which can be harnessed by proper monitoring and supervision of the MSMEs.

 

Mr Speaker, on this note, I support the report of your Committee. The recommendations in the report should be implemented by the Government.

 

I thank you, Mr Speaker.

 

Ms Chonya (Kafue): Mr Speaker, I thank you for the opportunity to make one or two comments on this well written report. I commend the Committee for the job well done. I would also like to adopt the debates of the four colleagues who spoke before me as my own. They have raised key issues and given good counsel to the Government on how we can to help our micro, small and medium enterprises. Their 2 per cent contribution to the gross domestic product (GDP) can be enhanced if they were given the support that they need, as recommend by the report and my colleagues.

 

Sir, my worry or concern is the aspect of taking the Executive up the good suggestions that come through the reports and debates on the Floor of the House. There is a section in the report which talks about how many issues are outstanding and not properly responded to by the Executive. That is what worries me because it shows the attitude and level of attention that we pay to the various issues that are brought up. I will give an example from the tourism sector, where the Committee on Energy, Water Development and Tourism has brought out the aspect of multiplicity of licences for that sector. I do not know at which point the Government will tell us that they have addressed these concerns in the tourism sector where we have a number of the MSMEs that are trying to contribute to our economy through the tourism sector which the Government has identified as another strategic sector to improve the economy.

 

Sir, there have been concerns of a very harsh economic environment …

 

Ms Langa crossed the Floor.

 

Hon. Members: Order, order!

 

Ms Chonya: … and the high cost of doing business in Zambia has been a song that has been sung by many concerned people, but there has been no the assurance from the Government that it is looking into this issue. Not too long ago, I learnt that the fuel in Zambia happens to be among the most expensive in the region, if not the whole of Africa. These are the things that look small, yet have a big impact on the emerging entrepreneurs in the category of the MSMEs. The aspect of financing has been well elaborated. The Citizen Economic Empowerment Commission (CEEC), in particular, was made reference to in the report. I wonder what is happening to this well intended institution. Funding seems to have dried up a long time ago. I recall that in Kafue, the CEEC advertised for entrepreneurs to go into farming and abattoir management. People responded to the advertisement, but it has gone quiet. I tried to make a follow-up with the CEEC. I was told the institution cannot even remember when it last received funding to support initiatives by the MSMEs.

 

Sir, the issue of high taxes is another matter which has transferred people’s monies from their own initiatives to pockets of unknown people. The point here is that these taxes are chocking the thriving of the MSMEs. Yet, if the MSMEs are well supported they provide a window for job creation and poverty reduction in the country.

 

Mr Speaker, I want to agree with my colleague who also raised a concern on how these funds from CEEC are disbursed. The report itself talks about the politicisation of the way the support is given to the players in this sector. This should not be the case because we have to give support to people that have capacity and potential, so that we get the best out of the little resources that we are disbursing for the purposes of supporting women or the youth through the different empowerment funds that the Government is providing. Therefore, when we give funds without criteria that is logical and makes economic sense, then, it means we are shooting ourselves in the foot by not doing justice to these processes.

 

Lastly, Mr Speaker, I want to emphasise the point that the Government should be concerned and serious about addressing the various issues not only in this sector, but also elsewhere because even our talking in this august House is at great national expense. We cannot afford to be talking and then no action is taken to correct or implement whatever proposals are made. I tend to get worried sometimes when I hear the Executive almost passing the responsibility, for lack of a better expression, for ‘bad performance’ in certain areas, on to the technocrats. However, the responsibility to ensure that whatever the aspirations and visions they have are successfully implemented still lies with the Executive because ultimately, it is the Executive that is accountable to the people of Zambia and not the technocrats.

 

I thank you, Mr Speaker.

 

Hon. Opposition Members: Hear, hear!

 

Mr Mung’andu (Chama South): Mr Speaker, I thank you for giving the people of Chama South an opportunity to debate on the report submitted to this august House by the Committee on National Economy, Trade and Labour Matters.

 

Mr Speaker, if you look at the topical issue which is the role of the MSMEs in relation to national development in our country and the subsequent submissions by many stakeholders, it is clear that both micro and macro fundamentals are emerging. For example, the Report has highlighted that there is a lack of access to finance. If you look at underpinning fundamentals to lack of access to funds, not only by small and macro enterprises, but the general citizenry, it has shown that there are high and prohibitive lending rates. What leads to this situation of disparity in our economy? It is clear that fiscal discipline by the Executive in relation to the financial performance and regulation by the Central Bank are at variance. What leads to high lending rates? Let us look at the financial sector. Banks simply get money from depositors; use the same money to lend to the medium and small enterprises. If there is no fiscal discipline, we will face a situation which is being highlighted here. Monies are being mopped up through Treasury bills and many other Government instruments from the public. Most investors get attracted to these Treasury bills and Government bonds because they are the most secure. The more the Government borrows from the public, the more money is mopped off the market. This leads to high lending rates. However, I am confident that the Government through the Central Bank have put measures in place that have tried to contain this situation. I will give an example of interbank lending rates in the country. It is quite reasonable. However, your Report, Mr Speaker, has urged the Government to intervene and ensure that these banks pass on the benefit of these low rates not only to medium and micro enterprises, but also the general citizenry. Where has the problem been?

 

Mr Speaker, it is clear that most of our commercial banks need this august House to pass laws that will strengthen the Central Bank to directly or indirectly regulate the passage of low interest rates.

 

Sir, with regard to debt contraction, the issue of conditions of payment is another challenge that is affecting the economy. For financing models of infrastructure, for example, you will observe that most of the foreign companies and countries that are able to assist give us loans with conditions. They will put their own companies as the main contractors. For example, the construction of 650 health posts and the erection of towers throughout the country. The Government should, therefore, ensure that as it negotiates these conditions, it is very strict to ensure that, at least, 50 per cent or 60 per cent of the money remains in the country.

 

Mr Speaker, I know that Huawei Technologies Zambia is the main contractor of towers in Zambia. The Ministry of Transport and Communication has also engaged many subcontractors on this project. This is to ensure that part of the money remains with our people, but there is room for improvement. We need to look at ways and means of ensuring that we get 80 per cent of these loans because it is the Zambian people who will be paying back. Therefore, it is just prudent that the money remains in our economy.

 

Mr Speaker, your report has also highlighted the hunting disputes that have arisen between hunting concessions and the forestry licence holders. Even if the report is talking about the national economy, it is multi-sectoral in terms of its findings.

 

Sir, we have seen how our neighbouring countries are managing these natural resources. I am a representative of the people of Chama South, who are directly affected by this because the main economic activities is hunting through professional hunters, Safari operators, outfitters and timber harvesters. When it comes to exploitation of our wildlife resources, most of the benefits do not accrue to our country. What happens is that an outfitter will be given a quota by the Department of National Parks. For example, he will be given about twenty buffalos and two elephants. An outfitter will pay K46,000 for an elephant and K4,600 for a buffalo and a Safari Operator will sell a buffalo at K88,000 or K90,000. An elephant will be sold in the range of K200,000. What will be declared to our national coffers when it comes to profit sharing is only 5 per cent. The rest of the money will go to the outfitter.

 

Sir, what happens in other countries? I will give an example of Namibia. Namibia has set up what they call, “conservancies.” This is the only sustainable way of managing, particularly, these resources. Instead of the Government selling these quotas to the outfitters, it sells to the community. The hunters will then equally share with the communities. This has resulted into serious conservation when it comes to wildlife and natural timber, in particular.

 

Mr Speaker, I will give an example of what happens in other countries with regard to timber. The Forestry Department can grant a licence to harvest 300 logs of rosewood. These timber trading companies will buy those logs directly from the community. This has made the communities to guard these resources jealously because they are seeing the benefits. In our case, if someone gets a licence for K100,000, which they still complain is too high, they will be allowed to harvest the rosewood as much as they can. That is not sustainable.

 

Mr Speaker, let me talk about trade. The hon. Member for Bwana Mkubwa mentioned something about trade. This report has particularly singled out one of our chain stores, Shoprite. The report states that Shoprite has unfavourable conditions for our farmers. Indeed, if we are to grow the economy, we need not only to support value addition to many products that our country produces, but to also find a market for our farmers.

 

Sir, these markets are usually in the form of chain stores. The Committee has given an example of products that are locally produced. We are told that the MSMEs can only be granted an opportunity to sell their products through these chain stores, if they have the ability to supply to all outlets. How possible can that be for an MSME, which has not yet attained the economies of scale? How can that be possible if it is not able to produce the quantities that can be sufficient enough to be supplied to all these outlets? In short, this is a direct barrier. As if this was not enough, these chain stores have gone ahead to stock almost 90 per cent to 98 per cent of the products that are from South Africa.

 

Mr Speaker, if we are to grow the MSMEs in order to grow our economy, we ought to come up with deliberate measures which can come in the form of taxes. As we sign many trade protocols, we should ensure that the taxation system does not favour foreign products. This report has highlighted that Chinese products of whatever quality are safely landing in this country.

 

Sir, we have multi-national chain stores such as Edgars and Woolworths. You will find that products that these stores stock in South Africa, Namibia and Botswana are different from what they stock in Zambia. In Zambia, they stock substandard products. This is robbing our people. How do we protect them?

 

The taxation system should be in such a way that it takes into account the cost of production. The unit cost of a product in the country is likely to be 30 to 40 per cent higher than other countries. Therefore, when we come up with exemption clauses on taxation, let us ensure that we increase the tax for those industries that we need to protect, particularly value addition industries.

 

Mr Speaker, in conclusion, the Report of the Committee on National Economy, Trade and Labour Matters has highlighted the wide difference between the savings and lending rates. This is another thing that our able Government should look into. For example, if I opened a fixed deposit account, I would be lucky if I were given an interest rate of 8 per cent, yet I would borrow at the rate of 30 per cent. If you went to a micro finance institution, you would unfortunately borrow at the rate of 70 to 80 per cent and this is compounding.

 

Therefore, we need to find mechanisms that will make the two lending rates agreeable. The growth of micro and medium enterprises is dependent on the access to affordable financing. The Chinese access lower rates even in our country. The Bank of China gives loans to Chinese citizens at 2 or 3 per cent or even 5 per cent. However, a Zambian will access the same money from a micro finance institution or medium enterprise at 28 or 30 per cent. Technically, a Zambian entrepreneur is knocked out just on this technicality.

 

Mr Speaker, let us try to put in place measures that will ensure that the citizens access affordable micro finance and that we create readily available markets. We can take advantage of our neighbouring countries since we are a land-linked country. We are linked to many countries. I know that the population of Namibia is small. It is about 2 million. However, they do not farm and have no eggs. The hon. Member for Sesheke Central will agree with me that just across the Zambezi River, there are no eggs at Katima Mulilo. A tray of eggs in Namibia costs K50 and here, we buy it at K18. The report highlights the measures that we have to put in place to ensure that our people access this ready market.

 

With these few remarks, I wish to support the report.

 

Mr Speaker, I thank you.

 

Mr Kafwaya (Lunte): Mr Speaker, thank you very much for allowing the good people of Lunte to be heard on this very important report rendered to the House by the Committee on National Economy, Trade and Labour Matters. I will contribute, firstly, on the importance of the MSMEs and, secondly and lastly, on the status of the MSMEs in Zambia.

 

The MSMEs are very important and their importance cannot be overemphasised. Considering the challenges that we have in our country, we need every strategy that can help the country boost its economy. The MSMEs play a very important role as far as stimulating the economy is concerned. One of the most pressing issues that have been mentioned by every concerned Zambian is gender inequality. When conducting trade, opening small companies and even conducting business in those small companies, there is no gender discrimination. This means promoting the MSMEs implies promoting gender equality.

 

Sir, job creation is another very important issue that everyone has been talking about. As a matter of fact, when the President was addressing Parliament, he clearly spoke about the level of poverty in the country and said that 54.4 per cent of Zambians live below the poverty datum line. This means that we have to find ways of promoting the economy so that it can support the Zambians in order for the 54.4 per cent to come out of poverty. Therefore, the MSMEs can play a very important role as far as this is concerned.

 

Mr Speaker, economic growth is another important aspect to which we can attach the development of the MSMEs. If we are to grow the economy, we need to promote the MSMEs because they provide over 60 per cent of products and services and if they do, they need to be supported so that even their contribution can be properly translated. We want to see the MSMEs contributing a higher value to the GDP as opposed to maintaining a 2 per cent contribution to the Gross Domestic Product (GDP) because this is a very important sector. A sector which contributes over 90 per cent of registered companies must also translate into value addition. This way, the provisions of services can be enhanced and the quality of lives for the Zambian people can improve as a result of the contribution of the MSMEs. Therefore, I agree with the Committee on the importance of the MSMEs.

 

Mr Speaker, let me come to my second point on the status of the MSMEs in Zambia. Your Committee ably illustrates the conditions under which the MSMEs are operating. One of the issues that the Committee raises is that the MSMEs are not supported by financial institutions. I wonder whether this is what prompted the hon. Minister of Finance to recently pay the local contractors K200 million. I wonder whether this is the direction we must take. The MSMEs need to be supported by the Government and financial institutions. Growing the MSMEs will improve the business of the financial institutions which are rendering very little support to MSMEs right now. It is very important to see this as progressive.

 

Sir, the other very pertinent issue that is raised by your Committee is the lack of good infrastructure. This is a clear indictment of the status of the road network even as the Patriotic Front (PF) took over in 2011. Does this then support the Link 8,000 km Road Project? I tend to think so even though this is not clear in the Committee’s report.

 

Mr Speaker, I have noticed that some roads such as the Kafue/Mazabuka, Kazungula/Sesheke and Shang’ombo/Sioma have been mentioned in your Committee’s Report while others have not been mentioned. However, allow me to add Mporokoso/Kaputa Road to the list. My concern is with the people who live in Kaputa, …

 

Mr Ng’onga: Hear, hear!

 

Mr Kafwaya: … and Nsama who come to trade in Kasama, Mpika, the Copperbelt Province and Lusaka. They have to endure the deplorable state of the Mporokoso/Kaputa Road, which is worse than the Kazungula/Sesheke Road …

 

Mr Ng’onga: Hear, hear!

 

Hon. Opposition Member: Question!

 

Mr Kafwaya: … and the Kafue/Mazabuka Road.

 

Hon. Government Members: Hear, hear!

 

Mr Kafwaya: Sir, I speak with maximum confidence on this subject, especially after having travelled on these roads. However, I would like to see that these roads are worked on. For example, the Isoka/Nakonde Road and Lunte/Zacharia/Chanda Road should also be added to the list. This is a clear support on the Link Zambia 8,000km Road Project which I would like to see implemented.

 

Mr Speaker, let me now talk about the bureaucracy at the Food Reserve Agency (FRA) that makes the FRA to support small-scale businessmen and women. This issue has been raised in your Committee’s Report. I am given to understand that the FRA exists for strategic reserves, but the FRA must be able to expand its authority to support MSMEs.

 

Sir, what worries me is when the people who are charged with the responsibility to make laws decline to participate in the enactment of the laws including the Constitutional Amendment. This is a problem we have in our country. On one hand your Committee will produce an excellent report like this one ably moved and properly supported, yet, on the other hand, politics will hamper development.

 

Therefore, it is my plea that politics must be able to be subordinated to development. What we all want to see these roads in Sioma, Kafue/Mazabuka, Mporokoso/Kaputa to be constructed. That is what we all want. This means that if we are going to honestly support these matters, we must be able to put politics aside.

 

Mr Speaker, let me end by supporting this report because it has raised important issues.

 

I thank you, Sir.

 

Hon. Government Members: Hear, hear!

 

Prof. Lungwangwa (Nalikwanda): Thank you, Mr Speaker, I rise to support your report, which is extremely important. The report has raised very important issues affecting the development of the country and our survival as a nation.

 

Sir, there is no doubt that the development process is an incubation process. As far as the economy is concerned, the incubation process deals with bringing out the eco system of entrepreneurs, innovators and business partners together and packaging them in what is termed as MSMEs. This is the formula that many countries have used to try to jumpstart their economies. In Zambia, we have equally realised that if we are to jumpstart the economy, we have to focus on the development of the MSMEs.

 

It is in the micro, small and medium enterprises that the structural imbalance of the economy can be addressed. We all are aware, Mr Speaker, that our economy is highly imbalanced. Right from Independence, we had a dual economy characterised by a very wide gap between the urban and the rural areas, that is, the rural-urban gap, between those who have high incomes and those who live in abject poverty. This is the reality of the structure of our economy. However, Sir, your report has brought out a very important insight, namely that 90 per cent of the enterprises in Zambia are in the category of the MSMEs while 10 per cent are large enterprises. The sad part of it is that the Report states that 98 per cent of our wealth …

 

Interruptions

 

Mr Speaker: Order on the right!

 

Prof. Lungwangwa: ... is generated by the 10 per cent large enterprises. The MSMEs only contribute 2 per cent to our wealth.

 

Mr Speaker, the challenge is that all the large enterprises, to a large extent, are foreign enterprises. These enterprises contribute 98 per cent of our wealth by implication, meaning that our wealth is being taken out of the country. This is because foreign enterprises are at the core of the production of our wealth.

 

It also means, Sir, that these 10 per cent enterprises are located in favourable business areas in particular, along the line of rail and urban areas at the expense of the countryside or rural areas.

 

Hon. Opposition Member: Hear, hear!

 

Prof. Lungwangwa: That is the source of our underdevelopment.

 

Mr Speaker, this implies that the vast parts of the country which are the rural areas have the problem of investment. They have a problem of stimulating economic growth and development. That is the problem we are in, which problem is giving us the challenge of how to address poverty, unemployment and rural underdevelopment. These can only be addressed more effectively if, as a country, we make a deliberate decision to grow the MSMEs and facilitate their spread all over the country so that they are able to penetrate the countryside. That is the only way we can jumpstart the economy.

 

Mr Speaker, what your report is also raising is the challenge of where the efforts are in the MSMEs. The efforts are in what we may call the software businesses such as taxis, hair dressing, restaurants and lodges. These are the software enterprises where the majority of the MSMEs are concentrating their efforts. It is very unfortunate. Yes, these are important services, but what about the hardware and the more challenging manufacturing sector such as the wood, mining, timber, metal and all those which can produce highly marketable and valuable products. Unfortunately, the MSMEs are not so much in to those sectors. How then do we hope to grow the manufacturing sector as a country and compete effectively in trading even within Africa? We have to do something.

 

Sir, for instance, a very interesting observation is a simple product like the insecticides. 90 per cent of the insecticides we use in our homes is water. Therefore, it means that when we are importing the insecticides, we are predominantly importing water into the country. Can you imagine that? We are importing water into the country, 40 per cent of the surface water in Southern Africa is in Zambia. Why would we import insecticides which, to the large extent, is water? Just imagine that.

 

Sir, the MSMEs ought to go into those kinds of products so that we cut off the importation water into the country. This can be done. What should our colleagues in the Executive do given the dilemma we are in? Clearly, the challenge to our colleagues, the Executive, is to protect the MSMEs. We need policies that are protective because if the Government does not protect them, cheap products from China will be flooding our market and they are already flooding our markets. Therefore, protection is important.

 

Mr Speaker, the Executive should support the MSMEs by supporting them with affordable finances. It is expensive to borrow from the financial market and we all know that. Efforts must be made to support these enterprises with money which are affordable. At the same time, efforts must be made to ensure that the Government contracts are given to the MSMEs so that they can carry out business with the Government. The major sector that one can make business with is the Government. Deliberate efforts must be made to ensure that the MSMEs are doing business with the Government. When they are able to do business with the Government, they will be able to generate employment and wealth in the far-flung areas of the country. This is the way we can jumpstart the economy and address the vexing problem, which is facing us.

 

Sir, the unemployment we are facing can easily be solved. We need to put our minds to those areas, which can make a difference, and this one of them. This is one area, which can reduce poverty in our country. We have abundant resources. So, all that is required is leadership.

 

Mr Speaker, I thank you.

 

Hon. UPND Members: Hear, hear!

 

Mrs Fundanga (Chilubi): Mr Speaker, I would like to thank you for this opportunity.

 

Sir, first and foremost, I would like to thank all the speakers because most of the things that have been echoed are actually some of my haboured sentiments. At the same time, I would like to congratulate your Committee on a well-thought-out report which has highlighted a lot of issues pertaining to what we are talking about. However, I just have a few things to add.

 

Mr Speaker, I would like to say that when we liberalised the economy, it was a well-thought-out idea. However, we should have added certain aspects of protectionism because there is no country in the world which opens itself up so much that it gives to anyone who can do business.

 

Sir, protectionism is one aspect in industry, which protects not only the citizens, but also the global thought-out norm of doing business. For instance, training is one aspect and when I saw the report, I first looked at the summary of submission by stakeholders and this is what I am going to concentrate on.

 

Mr Speaker, training is one aspect that can help this country and we should ask ourselves what kind of training we are thinking about in order to promote the MSMEs. When we refer to the MSMEs, we are talking about the people who are skilled, but probably have not been to school. Therefore, when we put a curb and say we are only going to train people who have been to school, we are leaving out the well skilled people who have not been to school. School in this country is normally translated a person, who has a Diploma and can speak good English.

 

Sir, let me share with the House the technology transfer. Africa is the only continent where a foreign language is used to transfer technology and, as a result, it has been a hindrance to our performance. For instance, there is nowhere in the world where a foreign language is used to transfer technology. Let me tell the House that in technology transfer, language plays a fundamental role on how technology is transferred because, somebody might not understand what I may say in English, but say it in my own language, a person I am trying to transfer technology and impart the technology into will understand it better. It is for this reason ourfriends have held on to their local languages because they understand that even as one is growing up, the embroidery of the local language translates into action, which we do not have in Africa,  yet we wonder why we are not developing. We are so foreign and it is not even standing. We should be ashamed of ourselves.

 

Sir, for instance, 75 per cent of Japan’s income ˗

 

Business was suspended from 1040 hours until 1100 hours.

 

[MADAM FIRST DEPUTY SPEAKER in the Chair]

 

Mrs Fundanga: Madam Speaker, before business was suspended, I was making reference to the Japanese situation and was saying that 70 per cent of the National Budget for Japan depends on the small-scale industries or MSMEs. A country that does not promote small-scale industries will find it extremely difficult to encourage the manufacturing industry in any sector of the country. I mentioned that when we liberalised the Zambian economy, one of the mistakes we made was to open up completely. In other words, our economy was too liberalised. As a result, there was no protectionism against the external forces out there.

 

Madam Speaker, I want to echo the sentiments of my colleagues who spoke earlier that nowadays, there are some Chinese business persons that are bringing, for lack of a better term, cheap goods to Zambia. We have allowed this situation because for Chinese products, it is a matter of quality versus quantity. Therefore, if you choose quantity, you will get a lot of cheap products. If you choose quality, then the price will be higher for the same product.

 

Madam Speaker, if we created our own industries, we would ensure that we do not allow finished products to be brought into the country. For example, Kenya has a very good policy regarding motor vehicles. Finished vehicles are not allowed into Kenya. Instead, vehicles are assembled in Kenya in order to create employment. However, we have liberalised our economy very much. I think the hon. Minister of Commerce, Trade and Industry should look into this aspect. We should make sure that we do not allow the importation of labour.

 

Madam, if we look at copper, for example, we are just exporting it as raw materials. We are not fully utilising this natural resource to create more employment. We cannot create employment if there is no value addition to our natural resources. When we talk about value addition in Zambia, most people think that the Government should create an industry which will be adding value to our produce. It is the small-scale industries run by ordinary people that should come up with the initiatives for value addition. When people form small companies, they can challenge the Government to give them incentives. The chances of success for individual small companies may be low, but if they come together and form value chains, they can produce finished goods from our own materials.

 

Madam Speaker, when I talked about skills training earlier, I emphasised that one of the biggest problems in Africa is that we impart skills using foreign languages. Language plays a very important role when it comes to imparting skills. Sometimes ,there are people who are gifted with doing things hands-on, but we ignore them because they do not have a Grade 12 Certificate, diploma and so on and so forth. We should harness the skills of such people.

 

Madam Speaker, I know we are not supposed to debate ourselves, but I just want to say that I have worked in the rural parts of Zambia for a very long time. I have realised that Zambians have the potential to do a lot of things. People in rural areas are surviving on their own without the help of the Government and they are very creative. An example is the baskets that are made in the Western Province. However, when we see that, we think that people are just wasting their time. That is an industry on its own.

 

We need to strengthen the skills in each and every part of this country so that we create employment and ensure that people do not go hungry. We have ignored local skills and instead taken a Western approach to commerce in this country. There is no trickle-down effect for millions of people in this country. The commerce in this country is dependent on transnational companies. For instance, if the Coca-Cola Company does not employ 500 people, we say that tabale ingisha abana besu incito, which means that they are not employing our children. If a transnational company does not employ Zambians, we start complaining.

 

Madam Speaker, the question is; what are we doing as Zambians to harness the skills of our people to create small-scale industries? We should engage in protectionism. For example, if Zambians can make baskets, we should not allow baskets to be imported from Kenya. We should not allow jam to be imported from South Africa when it can be made by Zambians. South Africa is doing that to us, but we are busy consuming products from other countries when our own people do not have jobs.

 

Madam Speaker, these are some of the things that we should address as lawmakers. We need to say that this is not right and address it. We are eating things like butter and jam from other countries, but complaining that there is no employment in Zambia. Where will the employment come from if we cannot harness the skills of our people? We do not always have to use English to impart knowledge. For example, we can teach the people in Kalabo to make goat cheese. Why not teach the people in the Southern Province to make butter or soap?

 

Madam Speaker, former President, Dr Kenneth Kaunda, started a small industries development organisation. Unfortunately, at the time it did not look attractive because of numerous competing needs such as free education and healthcare and so on and so forth. Therefore, people did not see the need for such an organisation. However, nowadays we are paying for everything because we have liberalised the economy. There is a lot of competition. It is, therefore, time for us to go back to promoting the small industries’ development. There is no country that has developed without small scale industries.

 

Hon. Members: Hear, hear!

 

Mrs Fundanga: I, therefore, challenge the hon. Minister of Commerce, Trade and Industry to reintroduce the small-scale industries development organisation to protect the MSMEs. This is what is going to help us. Those of us coming from the rural parts of Zambia know that the people have a lot of skills. Look at the way they package cassava and groundnuts, for example. It is a marvel. We just need to see how we can improve upon such small-scale industries.

 

Madam Speaker, let me come back to Japan. When people look at Japan, they think that it has a huge company that makes everything. However, if you go to the streets of Okinawa in Japan, you will find that there are hundreds of women just making knobs, chips or front screens for television sets. That is small-scale industry.

 

Madam Speaker, I stood up to debate this Motion because I am very passionate about small-scale businesses. I am not criticising the Committee. They have done a good job, but I just want them to add some of my suggestions. I have concentrated on commenting on the stakeholders’ contributions. If we took action on the identified challenges, Zambia would be a better place.

 

Madam Speaker, let me come back to the issue of training. The type of education being provided nowadays is not producing people who can produce anything. It is theoretical and not practical. I remember that when I was in school, technical drawing and other skills were taught. What has happened to that kind of education? When our children completed Grade 12, they have no skills to help them make a living. We should reintroduce vocational skills training in the education system so that when the children complete school, some of them can make desks, others can sew or become bricklayers. Right now, we just want them to go to the University of Zambia (UNZA) and afterwards, get a job in the Government. What kind of generation are we trying to bring up? Are we trying to bring up a generation of people who can only take up white collar jobs or blue collar jobs? Many countries asked themselves: Who do we want to copy? After the war, South Koreans asked themselves that question. They looked at Germany and decided that they wanted to be like that country. This is why Undai vehicles look like Mercedes Benz cars.

 

Madam First Deputy Speaker: What is the vehicle, hon. Member?

 

Dr Kambwili: Hundai!

 

Mrs Fundanga: Undai!

 

Hon. Members: Hear, hear!

 

Mrs Fundanga: Aah! Okay, in Korean, it is “Hyundai,” but we call it “Undai” here.

 

Madam Speaker, the South Koreans said “Cheoncheonhi, ulineun geugeos-eul hal geos-ida” In English, it means: Slowly, we shall do it. It is very important to look at a picture of what your friends are doing and copy it. Most people here said that some countries just copy other people’s ideas. We have failed to copy anything. We cannot even make a balloon or a paraplu –

 

Hon. Government Members: Parachute!

 

Mrs Fundanga: No! An umbrella, yet we are insulting umbrellas from Taiwan.

 

Madam Speaker, what I am trying to say is that we should copy from the best. Our friends in one country sat down and realised that Germany has the best model of education. So, they copied it. In Germany, people who graduate from other universities still have to work under someone who graduated from a polytechnic university because a polytechnic university teaches practical skills. Former President Kaunda provided a technical school in each provincial headquarter. What did we do with them? Nothing. We should have transformed them into polytechnic universities so that our children could learn practical work. I can tell you that the University of Zambia (UNZA) has electrical engineers who cannot even fix a bulb, an ordinary bulb.

 

Hon. Government Members: Question!

 

Hon. Opposition Members: Hear, hear!

 

Mrs Fundanga: Madam Speaker, the Ministry of Commerce, Trade and Industry should engage with the Ministry of Higher Education to see how skills training can be provided for our children so that when they finish school, they do not look forward to getting only white collar jobs or blue collar jobs, which are not even available, anyway. They will be self-sufficient. This is what is happening in most countries.

 

I thank you, Madam Speaker.

 

Hon. Government Members: Hear, hear!

 

Ms Kasune (Keembe): Madam Speaker, thank you for giving me this opportunity to add my voice and that of the people of Keembe to the report by your Committee on National Economy, Trade and Labour Matters.

 

Madam Speaker, a lot of things have already been echoed by many colleagues from different constituencies. The cry is that the MSMEs are being left out in accessing credit because our policies have not been actualised. They have either been shelved or there is little implementation.

 

Madam Speaker, I am going to focus on where I come from, which is Keembe. I think the situation in Keembe is similar to that of many rural areas in Zambia. Over 60 per cent of the people in Zambia live in rural areas. I stand to be corrected on that statistic. However, if it is correct, it means that there are more small and medium entrepreneurs in rural areas than in urban areas. What I have got from the report is that more trade is being done in the urban areas than rural areas. People may not be aware of this.

 

Madam Speaker, there is no market for the products produced by the small and medium entrepreneurs in rural areas. People from Keembe are supposed to take thirty minutes or an hour, at the maximum, to bring their produce to Lusaka. However, it takes them hours or days and this is a challenge. If the people of Keembe are struggling to bring their produce on time to Lusaka, can you imagine how hard it is for people in Shang’ombo and other remote areas? We need to realise that developing our country is not an endeavour that can be done by one ministry. The lack of roads has a direct implication on business development. The rural people cannot grow their businesses because of a lack of roads.

 

Madam Speaker, another point that many colleagues have already alluded to, is packaging of our goods. We may sing about being proud of our Zambian products all the time, but if our packaging is not up to the standards of other countries, we may not be able to market them outside the country, because other countries may not accept our products. If they accepted them, they would do that at a very low value. This has an implication on our small and medium businesses.

 

Madam Speaker, we have a policy that a minimum of 20 per cent of the contract sum of road projects awarded to foreign contractors must be subcontracted to Zambians. Local Zambians are contracted to do these works, but, sometimes, they are not from the areas where these projects are being done. A road being constructed in the Southern Province, for example, will not have people from that particular area engaged to work on it. Therefore, it is not enough to say that Zambians should participate in road construction works. The Zambians who participate in these road projects come from urban areas, and the rural people are left out. This is happening everywhere.  People in rural areas are crying and saying that hospitals, clinics and schools are being built in their communities, but the workers on those projects are not from their areas. I think that has to change. There is a big gap between what we say and what is implemented on the ground.

 

Madam Speaker, the other issue is that of storage. I think that in this country, we have not treated storage for our produce as seriously as we should. You will find that things like tomatoes, which are a driving force in Keembe Parliamentary Constituency, are not properly stored or preserved. These tomatoes are left to rot because there is no mechanism to preserve them. There are also no cold storages in certain places. However, we need to move from the traditional ways that our grandmothers kept their farm produce for future use. For instance, our grandparents would dry the vegetables by leaving them in the sun, on the sand and when you ate them, they would have so much sand. When dried in the sand, the vegetables get so contaminated with other particles and so, no one wants to buy them. These are some of the issues we need to begin to look at. Sometimes, we have situations where we look at the secondary level of implementation and realise that we have escaped the very primary steps that needed to be taken into consideration.

 

Madam Speaker, the issue of finished products is very critical. The hon. Member for Chilubi Parliamentary Constituency has also spoken highly on this. We are in a country where Mukula tree is the talk of the day on social media. The talk on Mukula Tree is also in most of our debates in this august House. However, that product is still being exported in its raw form. Yet, when it comes back to our country, it will be in the form of finished products. When you look around this august House, you will see that most of the furniture and other things are imported. What signal are we sending not only to MSMEs, but also to the country at large? We sell our raw products like the Mukula tree and Copper at very low prices, but when they are imported into this country, they are exorbitantly priced. We need to realise that it is not just the families purchasing those things at a high cost, but the Government is also spending a lot of money. In the end, we are not only cheating our country, but also making a loss on the economy of our country. These are just some of the things that can be improved upon.

 

Madam Speaker, there are practical examples which we can learn from, little as they may seem. However, they will go a long way.

 

Interruptions

 

Madam First Deputy Speaker: Order in the House.

 

Ms Kasune: Madam Speaker, we should have deliberate policies that will give preference to the MSMEs when awarding contracts such as the supply of door frames and window frames. There are so many things that can be done by the MSMEs. In some places, you will find that the MSMEs have stones which can be turned into tiles. In rural areas, all you need is a rough kind of tiling versus the more sleek ones which may end up not being practical for a particular area. However, there is a lack of implementation even when policies are there. We do not see the implementation of projects from which the MSMEs can benefit.

 

Madam Speaker, another simple, but practical example which can be implemented by our friends in the Executive is by giving the MSMEs a priority to provide uniforms to the country’s Defence Forces that include the police, the army and many others. This not will only contribute to economic growth within the country, but also preserve the resources and ensure they stay or remain within the country.

 

Madam Speaker, I know that we live in a global economy, and so, people are free to travel to different countries. However, I notice that many countries prioritise their local citizens. Many of us have been greeted by investors who come to this country and start engaging in certain businesses. For instance, you will find an investor selling a cellular phone from his pocket and you wonder what kind of visa they were granted. In some places, some of the so-called investors sell cobs of maize, which is being roasted at the market. This goes to show that there is a discrepancy and a gap in the prioritisation of our own people. Using the tag called ‘Proudly Zambian’ is not enough because it is just that, a tag. Until we start implementing these things, we will not see development in the country.

 

Madam Speaker, on financing, I feel as if I will just be repeating what has already been echoed. The cry about the lack of implementation continues. That is what is killing this country in terms of development and that is why we are not seeing progress as it should be. We have the natural resources, yet we are failing to implement projects that could earn the country money. How can you compare yourself to someone who is going to borrow money at the interest rate of 2 or 3 per cent, while you are borrowing your resources at 28 per cent?

 

Hon. UPND Member: 32 per cent.

 

Ms Kasune: Someone is saying 32 per cent. As a Member of Parliament, I am scared of borrowing. How much more an ordinary person in Zambia? If they borrowed, they not make a profit and their business will go down eventually. This brings us back to the fact that Zambians are failing to make it in businesses. However, I want to say that it is not that Zambians cannot make it, but that we are disadvantaging our very own. I do not know who the author of what I am going to say is, but someone said, “A nation's greatness is measured by how it treats its weakest members.” That is the question we should ask, not only in the conversation of the report today, but also in a lot of our dealings as a country. We will never get to where we are supposed to be if we keep failing to implement policies that are friendly to all the Zambians and not just the MSMEs.

 

Madam Speaker, the gender gap is another issue. For a long time in Zambia, a lot of women did not have the power or capacity to own land. They also did not have the capacity to purchase a house. This was usually in a husband’s name. Therefore, when a woman is divorced or widowed and she wants to start a business, the bank and those who lend out money are going to ask her for collateral. Many women may not have that collateral. This is why I want to ask the hon. Minister of Lands and Natural Resources to ensure that the National Land Policy is worked on to ensure that women are empowered with land and property which they can use as collateral. That way, the women will be able to run the affairs of their families and communities too.

 

Madam Speaker, let me now turn to the issue of training. This is very critical and as already stated, training should not only be academic, but also vocation oriented. Many businesses that are run do not need academic training. That is not to say academic training is bad. It is just as important because it equips people in a different way. However, we need to revamp the technical schools and institutions that have become white elephants because they are not being utilised. One such institution is the Keembe Farm Farm Institute. When people hear of the Keembe Farm Institute, they think it is a place for farming. It goes beyond that. This is a place which was built using Zambian money. This facility was equipped with the necessary equipment, but four years down the line, it remains unutilised. Not only are we losing resources, but we shall also have a situation that by the time someone decides to make use of the facility, it will have been run down and the works may have to be redone all over again. There is so much wastage in this country. There is also a lack of prioritisation and so, we keep moving from one place to another putting up structures which remain incomplete. This is creating stagnation, especially in the economy of Zambia. There is no reason a country blessed with so much sunshine and natural resources should remain at the same level.

 

If we took nothing from the sentiments that the Chairperson made, then, the Committee and the work of hon. Members would be irrelevant. We hope that the contributions, not only from the Committee which did an excellent job, but also from many hon. Members in the House will be taken into consideration for a better Zambia.

 

I thank you, Madam Speaker.

 

Madam First Deputy Speaker: I will allow the hon. Member for Chifunabuli, the hon. Member for Roan and the hon. Member for Kabwe Central to debate before the Executive can respond.

 

Mr Mecha (Chifunabuli): Madam Speaker, allow me to thank the President of the Republic of Zambia, for granting Chifunabuli a district status. The people of Chifunabuli are grateful for that gesture.

 

Hon. Government Members: Hear, hear!

 

Mr Mecha: Madam Speaker, a number of issues have been brought to the fore by various debaters and it is not my intention to be repetitive, as per my debating culture. In this regard, I will focus on issues that have not been brought out.

 

I have gone through the Report of the Committee on National Economy, Trade and Labour Matters. There are various interesting issues that they have brought up which can account for the development of the MSMEs in Zambia. I will focus on a key aspect of the report which is policy and legal frameworks.

 

Madam Speaker, the Committee has done a very good job in bringing to the fore the role of the Zambia Development Agency Act and the Citizenship Economic Empowerment Act in fostering the growth of the MSMEs in Zambia. However, I think I need to highlight that there is one important legal ingredient that is missing from the report.

 

You will recall that this Parliament considered a Bill and enacted a law entitled the Skills Development Fund Act in January. This is a very important policy ingredient in as far as development of the MSMEs is concerned. If we ignore this important role, even the issues which we are talking about regarding skills development will not be addressed adequately. This is a law that provides for the development of a Skills Development Fund. This fund is currently in place and is being hosted by the Technical Education, Vocational and Entrepreneurship Training Authority (TEVETA) under the Ministry of Higher Education. However, what is interesting is the fact that the contributors to this fund are actually employers and among them are the MSMEs.

 

This fund is actually getting money through a payroll mechanism every month. It is in the interest of every employer to ensure that this fund is put to good use. If we can put this fund to good use, many of the gaps that have been highlighted through this report in terms of the knowledge and skills gap can be addressed.

 

Madam Speaker, since the fund already exists, we expected that TEVETA would have done a lot of work regarding the training assessment needs of the various categories of business. We are dealing with various segments of business which are micro, small and medium. These different categories of business have specific needs. The needs of the micro ones may not necessarily be the same needs that the other business segments are experiencing. In this regard, the expectation of the employers is that this fund will help address the targeted needs of specific entrepreneurs.

 

Up until now, I have not seen a document that comprehensively covers the needs of various business segments in Zambia. Without this document, we will not go anywhere. We will not have a framework for the training of these entrepreneurs. There are so many interventions that have been suggested by the Committee like the mentorship programmes and the business incubation programmes. These are some of the activities that can actually benefit from this Skills Development Fund. In short, we need to see a close link between the micro, small and medium entrepreneurship skills development programmes with the fund that we have created. I think that link is missing and if this report is not going to address that, then, we will continue experiencing a disconnect between and among various ministries.

 

Madam Speaker, the Committee visited the Ministry of Commerce, Trade and Industry and the ministry could not highlight how it is tapping into this fund. This clearly shows that there are weak co-ordination mechanisms which need strengthening.

 

In conclusion, these two recommendations are going to come to the fore in terms of enhancing the collaborative linkages between the Ministry of Commerce, Trade and Industry and the Ministry of Higher Education through TEVETA so that they can develop mechanisms on how these business entrepreneurs are going to tap into this very important fund.

 

Lastly, I appeal to the Committee and the hon. Minister to reinforce the report by discussing how the link will be fostered between the micro, small and medium enterprise development plan and the Skills Development Fund.

 

With these few words, I support the report.

 

I thank you, Madam Speaker.

 

Dr Kambwili (Roan): Madam Speaker, thank you for according me this opportunity to add my voice to this very important debate which, if not well annexed, will cause this country not to develop.

 

Before I go any further, let me be the first one in this august House to pass my condolences to the family of Hon. Daniel Munkombwe who passed on this morning. May the soul of the old man rest in eternal peace.

 

Madam Speaker, having listened to the discourse in this august House this morning and having gone through the report of the Committee, I am of the opinion that what this country needs is not Committee reports, talk shows and debates without action. All the issues that have been raised are things that we all know. I do not think we needed the Committee to come up with a report in order for us to make things happen in improving the welfare of the MSMEs in Zambia. What we need is an action-oriented leadership that is focused on making sure that the Zambian citizens are at the centre of business in the country.

 

It is a waste of time to say that you want to build a medium and small-scale enterprise sector when all the Government contracts even building of toilets are being given to Chinese contractors. It is a shame. Are we not ashamed that the people that have built Zambia are people like Minestone, Mulundu Construction and Appolo in Chingola. Today, even the building of police houses is given to one Chinese contractor in the name of Avic International.

 

Hon. Opposition Members: Hear, hear!

 

Dr Kambwili: Zambians have been relegated, in those contracts, to only excavating toilet lines. Then you come here and say, we are busy, we want to develop small-scale enterprises. What kind of people are we? Are we not ashamed?

 

Madam First Deputy Speaker: Hon. Member, we should not debate ourselves. Not even as Members.

 

Dr Kambwili: There is nobody I have mentioned.

 

Madam First Deputy Speaker: No! Not even as hon. Members of Parliament, but speak generally and make reference to yourselves as leaders collectively.

 

Dr Kambwili: Ine awe.

 

Madam Speaker, what I am trying to say is, as leaders, we are failing, but we want to pretend. We come here, listen to reports, talk and sometimes, I feel like not contributing to some of these debates because they are not making any sense.

 

Mr Mutale: Ikala panshi kanshi.

 

Dr Kambwili: The thing is practicability. It is this same Government where we sat and I was in Cabinet then, and said quarrying and block making should be left for Zambians. It just took one Chinese Ambassador to go and complain that our people are already doing quarrying, where are they going to go? Since then, everybody has gone quiet. This is patronage, and when you patronise these people too much, there is absolutely nothing that you will implement. You are wasting your time. How can you explain that in the 70s, 80s and early 90s, 90 per cent of the suppliers to the mining industry were Zambians. We had the likes of B. Y. Mwila, Mr Shame Mulenga, Hon. Kampamba Mulenga’s father; in Mufulira there was a mister − What is the name of that man who marries coloured women?

 

Interruptions

 

Hon. PF Members: Mwamona!

 

Dr Chibanda: Mr Ramzy.

 

Dr Kambwili: No, not Ramzy. That other old man.

 

Interruptions

 

Mr Chabi: Mwamona!

 

Laughter

 

Dr Kambwili: Anyway, I have forgotten the name.

 

We had all these Zambians participating in the mining industry at the time there was Zambia Consolidated Copper Mines (ZCCM). There was a lot of money in circulation on the Copperbelt. There were a lot of jobs created by these small-scale enterprises who were dealing with the mines. Immediately we privatised the mines, new owners stopped dealing with Zambian suppliers and contractors. They prefer to deal with their own. Look at what is happening in Kitwe today. Three quarters of the companies working for Mopani Copper Mines and Konkola Copper Mines (KCM) are Boers because most of the senior people come from South Africa.

 

Ms Chonya: True!

 

Dr Kambwili: Yet you cannot protect your own people to do business. Chinese mines are even worse. Most of the people that do primary and secondary mining development are Zambian companies. Today, when you go to the Chinese-run mines, not even one Zambian contractor is involved development. It is 15MCC or China Nonferrous, why do we allow such a situation? First, you sell them the mine, they are getting your copper, they are even providing the labour and they have taken all the contracts. Then we say, let us go to Parliament and do a report on MSMEs. It is a talking shop. It will not take us any where.

 

Ms Chonya: Hear, hear!

 

Dr Kambwili: What we need are people to be practical. It cannot be business as usual. Everywhere you go; the construction industry is nyanyi chuangya, Chinese.

 

Laughter

 

Hon. PF Members: What is the meaning?

 

Dr Kambwili: How can we live as a country, like that?

 

Hon. Opposition Members: Hammer!

 

Dr Kambwili: Therefore, what we need to do is to go back to the drawing board and come up with rules and regulations that are going to favour Zambians in these jobs. Then, we will have a crop of small and medium entrepreneurship. By the way, there is no country in the world that can develop without its own people getting …

 

Ms Chonya: Hear, hear!

 

Dr Kambwili: …involved in issues of business, more especially at medium and small-scale level. We are even proud to say we are implementing 20 per cent sub-contracting, no, it is supposed to be fifty, fifty.

 

Ms Chonya: Wow!

 

Dr Kambwili: When you give a contract, if you want to continue with giving contracts to Chinese or Lebanese or whoever you want to deal with, tell them 50 per cent of the contract should be sub-contracted to Zambians. This is because they will leave you with the roads that will not stand the test of time and they will take the money and the technology away. What are you gaining from that?

 

Ms Chonya: Nothing!

 

Dr Kambwili: Please, those in Government, what has happened? I want the hon. Minister when he comes to respond to address these issues- I was there when we said quarrying and block making should be for Zambians. When I am travelling from the Copperbelt, on the Kabwe/Lusaka Road, I see more factories for pavers and blocks being established. Who is giving the licence to those Chinese and Lebanese to establish those companies when the policy says that shall remain for Zambians? You even allow Chinese to engage in chicken rearing, to do that. Hon. Minister of Agriculture or is it Minister of Animals …

 

Laughter

 

Dr Kambwili: …is it animals and …

 

Laughter

 

Dr Kambwili: …livestock.

 

People have lost jobs in this country. People depend on their backyard raring of chickens, but you are allowing the Chinese to do that. I do not know what chemicals they use. Their chickens are bigger than the chickens reared by Zambians. Obviously, when these Chinese take their chickens to Shoprite, they will be the preferred ones from the chickens reared by Zambians. Where do the Zambians sell their chickens? Now, the Chinese are even in markets. Previously in markets, it was either a Zambian or an Indian shop. We have been with Indians from a long time. They have always been with us. Today, all the shops are occupied by Chinese even in markets. Our own people used to go to China, get clothes to come and sell here. Now, we are allowing Chinese who borrow money in China at 2 per cent, flood the Zambian market with Chinese goods. The Chinese are retailing relegating our people out of that business.

 

Ms Chonya: Hear, hear!

 

Dr Kambwili: At the month end, they transfer the money to China. Your exchange rate goes up and you are complaining. You are causing the problem yourselves. By the way, after fifty-two years of Independence, we cannot allow a country whereever there is an open space, a shopping mall is built. In that shopping mall, all the goods are either from South Africa or China. How do you improve or establish your own manufacturing base? This idea of signing trade protocols with the Southern Africa Development Community (SADC) or Common Market for Eastern and Southern Africa (COMESA) that do not favour the Zambian people should come to an end.

 

Hon. Opposition Members: Hear, hear!

 

Dr Kambwili: Yes, we realise we live in a global economy, but what is signing a protocol that is going to be at a 90 to 10 per cent ratio. The trade balance is always tilted towards other countries. To make matters worse, the MSMEs will only be contracted by multinational companies that are doing business here. Hon. Minister of Mines and Minerals Development, you are allowing exportation of copper anodes and copper blister. Why? Copper blister is not 99.9 per cent pure copper. Therefore, they will export as scrap copper, but when it goes there, they will build industries to purify it and make finished products from copper instead of establishing that purification industry here so that we employ our own people and that the MSMEs also contracted by those industries.

 

Madam Speaker, I miss Mr Sata who said we cannot be exporting soil when he was referring to copper concentrates. Today, we are back to square one, copper concentrate is being exported.

 

Ms Kapata: On a point of order, Madam Speaker.

 

Dr Kambwili: What kind of people are we?

 

Ms Kapata: Point of order!

 

Madam First Deputy Speaker: Resume your seat, hon. Minister. There will be an opportunity, which I have already announced, for the Executive to respond.

 

Hon. Opposition Members: Hear, hear!

 

Madam First Deputy Speaker: Let us not disturb those that are on the Floor debating.

 

May the hon. Member for Roan, please, continue.

 

Dr Kambwili: Madam Speaker, if we have to build a reasonable MSME, first and foremost, we must ensure that the policies that we make favour the Zambians. This idea of giving all the jobs to the Chinese, is killing this country. We beg on behalf of the people, can the Chinese be allowed to understand complicated works such as road construction, but …

                                                                                                                             

Mr Ngulube pointed at Dr Kambwili’s untacked shirt.

 

Dr Kambwili: Mwaice, ulufumo naluya, lule kula fwe ba President.

 

Laughter

 

Dr Kambwili: Iwe, mwaiche, iwe.

 

Madam Speaker, what I was trying to say is that …

 

Interruptions

 

Dr Kambwili: …we must favour our own people. The Chinese can be given complicated jobs and simple ones such as the construction of houses can be given to the Zambians. Nga ba kalamba bandi nga nabalanda ati, ‘ausheshi’, Ba Hon. Wanchinga. My elder brother, Hon. Dr Wanchinga could have said ‘ausheshi’ instead of houses. We cannot be giving the Chinese to construct houses. In this country, we have construction companies such as Bulundu, Minestone and Appolo that can do those jobs. What has necessitated this Government to give …

 

Dr Chabi: Even Mwamona!

 

Dr Kambwili: Yes, even Mwamona Engineering and Technical Services Limited can build.

 

Laughter

 

Dr Kambwili: I mean, we have built so many police stations. You can ask the hon. Minister of Home Affairs although we have not been paid.

 

Laughter

 

Dr Kambwili: Mr Speaker, this idea of giving jobs to the Chinese will not make us meet our target of improving or, indeed, creating reasonable MSMEs. Let us work together. Those in Government and us in the Opposition should work together so that we can come up with laws.

 

Hon. Government Members: Which party do you belong to?

 

Laughter

 

Dr Kambwili: I am in between.

 

Laughter

 

Madam First Deputy Speaker: Hon. Member for Roan, for the record, can you restate which grouping you belong to. It is very important.

 

Dr Kambwili: Madam Speaker, for the purpose of Parliament, I am Patriotic Front (PF), but outside, I am a consultant.

 

Laughter

 

Dr Kambwili: Madam Speaker, what I was trying to say is that we all need to put our heads together. It should not be a blame game. This is a serious matter that we need to reflect on. I do not think that in China, we can find that 90 per cent of the contracts are given to the British, Americans or indeed, Zambians. Why should we do that? We need to reflect on that matter and make sure that we help our own Zambians. Let us not treat Zambians like second class citizens in their own country.

 

Madam Speaker, I support the report.

 

Hon. Members: Hear, hear!

 

Mr Ngulube (Kabwe Central): Madam Speaker, thank you for according me this rare opportunity to add my voice on those supporting the Committee on the National Economy, Trade and Labour Matters.

 

Mr Chabi: Also mention ifya mu ma cells.

 

Mr Ngulube: Madam Speaker, I am delighted that my brother, the hon. Member for Chipili thinks that since I also went into police custody, then we are now at the same level. I think he is mistaken.

 

Mr Chabi: Hear, hear!

 

Mr Ngulube: Madam Speaker, I know that we cannot debate the growth of the MSMEs without necessarily talking about some of the issues that are affecting the people on the ground. Right now, if we asked ourselves what these MSMEs are, you would discover that we are talking about street vendors and marketeers. We are talking about our own indigenous Zambians who are trying to make money by selling small products. I am told that the council police have now increased by 150. Today, if any Zambian walked in the streets carrying baskets for sell, they would be told that they are engaging in street vending. Therefore, we have conflicting laws.

 

Madam Speaker, the laws against vending are actually directly colliding with the need for the growth of these sectors. I know that the Government is doing everything possible to relocate our displaced street vendors to areas where they can be trading, but until such a time that all these vendors and former street vendors have been given places where they can trade and be given a conducive environment, it will remain a dream.

 

These reports will come and go. We will continue saying we support this and that, but nothing will happen. 

 

Madam Speaker, I know that today, we are favouring companies such as Airtel Networks Zambia, MTN Zambia, the Zambia Telecommunications Company Limited (ZAMTEL), Zoona and all these big companies that are busy displacing our people from the streets and putting up booths. Is that not vending? Those booths that belong to all these huge corporations and some of the owners do not even live in Africa, but are displacing our people from the streets. Let us allow our own youths to sell airtime in those booths.

 

Madam Speaker, in Kabwe Central, we are being told that the council wants to remove people who are trading in booths. They want to lock them up for selling in the streets. We have challenged the council by telling them to start by locking up MTN Zambia, Airtel Networks Zambia, ZAMTEL and I, as the area Member of Parliament. When that is done, then, we can agree on who should be on the streets. Speaking on behalf of the youth in Kabwe, I think we are not doing justice to the system.

 

Madam, I am speaking from the background of people not being even MSMEs. Maybe then, we were smaller than micro business men. We have evolved from a time when we were not even called business persons. Probably, it was even illegal to call ourselves business men but today, we are in business because the environment was conducive for us to grow. Therefore, as long as we continue harassing the vendors and passing laws that are restricting the trade in this country, believe you me, Madam Speaker, it will be very difficult for these MSMEs to rise to the level of being called business men.

 

Madam, I have been to countries where I know that even when their laws say that street vending is illegal, everyday at 1700 hours there is a window. We have in our own Markets and Bus Stations Act, Section 7 that allows the council and the Minister of Local Government to create what are known as market streets. At 1700 hours, they can go and do their trading. They can park their cars and remove their vegetables and sell. At 2000 hours, they pack their things back in the car. In the morning, when people are going for work, they will find that the markets have been vacated. That is a window that we have actually failed to take advantage of.

 

Madam Speaker, much as we want to talk about growing this sector, for as long as we continue to engage in actual prevention, believe you me, even twenty years from now, our children will come and debate the same MSMEs. We have not been very liberal as a country in the way we have allowed ourselves to grow in terms of commerce. If you looked at, for example, the green beans in one of the shopping malls that are coming up, you would see that the farmer who produced it is either from South Africa or Brazil.

 

Madam, we are now getting vegetables in containers from as far as China. The Zambia Revenue Authority (ZRA) is clearing people bringing in tomatoes, onion and potatoes when we have big farmers just here in Mazabuka and Lusaka, who are able to grow for the consumption that this country needs. We are talking about the fish reserves. Zambia has the biggest water bodies in the region for a very long time now and I think it will remain so for many million years to come. It is unfortunate that we have authorised people to grow their fish in unconducive waters. This is the water that has been condemned, where all the factories dump their waste. They grow that fish from such water and we even accept it.

 

Madam Speaker, we would not be doing justice to this topic if we did not talk about the contradiction in our laws. The Forestry Act and its amendments is very clear that in order for one to get a concession in forestry, he/she must either be a Zambian citizen or have a citizen owned company. However, let us look at what is happening on the ground. The Zambia Forestry and Forest Industries Corporation Limited(ZAFFICO) is exporting Mukula as a Zambian company, but the people who are buying it are our brothers and sisters from an Asian country that I do not want to mention, although I know that everybody knows the country that I am talking about. We have a lot of forestry reserves here in Zambia. The Government discourages exporting anything without adding value to it, but do we see any new factories being created for the wood to actually get its value?

 

Madam Speaker, we have very good and brilliant laws, but with difficult provisions here in Zambia. However, how often do we ensure that these laws are actually enforced? Let me talk about the small-scale mining licences. The Mines and Minerals Act, No. 11 of 2015, states that one must be a Zambian citizen in order to get a small-scale mining licence. However, the people exploiting our minerals in these small-scale mining companies are not the Zambians. We are giving the people very good laws and protecting them and also giving them everything with one hand and then grabbing it with the other hand. We have a lot of drawbacks and as a country; we do not seem to be moving in the right direction. From 1964 to date, Zambians are protected starting from the Constitution up to the latest law passed by this august House, but how often do we see certain things being enforced?

 

Madam Speaker, if you went to the Central Statistical Office (CSO) today to ask how many street vendors we have, that information would not be readily available. Even if you went to the Lusaka City Council (LCC) to ask how many marketeers we have, they would not give it to you because do not seem to have a data base that captures the people. Therefore, we need to begin looking at areas that we should grow our sectors from. We have the manufacturing sector and some people doing arts and crafts while others are involved in small-scale mining, vending and all sorts of trading. However, as the report clearly states, it is very difficult for traders to legalise their businesses starting with the inhibitive licencing criteria. If I went to apply for a trading licence at the LCC, I would be told to pay K3,800. If I had a capital of K100 or K150 and used it to buy vegetables from Soweto Market to sell at the local market and was asked to pay K3,800, it means then that the council is not being very helpful. Therefore, I suggest that the Government considers creating concessions for the people. The councils are currently exploiting the people in the markets and trading areas because they are using the revenue they are getting from them as a way of fundraising for their activities.

 

The Government must find ways of increasing financing to the councils even if they get the Local Government Equalisation Fund and other small grants. Why do we not have a situation where we can pull our resources and get all the money in the National Budget? For example, the Ministry of Local Government, Ministry of Health and Ministry of Agriculture or simply put, all the Government ministries put their money in one basket and can start implementing Government programmes along those lines. I am of the view that if that were possible, all the pressure that the people in the markets, on the streets and everywhere else would actually go away.

 

Madam Speaker, in conclusion, I want to state that it would be important that as much as we debate these reports and create more reports from our debates, we could one day see the implementation of some of the good laws and could also have a law review. The hon. Minister of Justice will agree with me that there are laws that cover almost everything here in Zambia. However, how many of these laws do we test or are being enjoyed by the people? We now have a situation where we have given ourselves a lot of laws, but cannot manage to ‘chew’ all of them. As a result, we do not enjoy the benefits of the provisions that we create for ourselves.

 

With those many words, I support the Committee’s report.

 

I thank you, Madam Speaker.

 

Madam First Deputy Speaker: I have received communication that the hon. Minister of Works and Supply will speak before the hon. Minister of Commerce, Trade and Industry.

 

The Minister of Works and Supply (Mr Mutati): Madam Speaker, indeed, the report of the Committee on National Economy, Trade and Labour Matters has raised a number of critical issues. Most of the debators who have contributed have also raised issues that we need to address. I was particularly amused by Prof. Lungwangwa. I agree with him that development is an incubation process and that you need a functional equal system in order to drive the growth of the economy, derive jobs and create opportunities for the people. However, we must address the component of functionality and this is one of the issues that was raised in the Committee’s report. The other issue that was raised is on the cost of doing business and top on the agenda was the cost of money including access.

 

Madam Speaker, the Central Bank has done a commendable job. It has done what must be done in addressing the policy rate which is now 9.75 per cent. It has reduced the reserve ratio to only 5 per cent and, therefore, injecting substantial liquidity in the market. It has further urged commercial banks to address issues of cost and access. However, the results are not at the level that would facilitate the growth of SMEs. Therefore, beyond what the Central Bank has done, we need to address that which is causing the elevated cost of money. The other issue that we need to address is the containment of the fiscal deficit. Indeed, the measures that were addressed by the hon. Minister of Finance yesterday are directed at addressing the fiscal deficit and enhancing revenue and control of cost. Therefore, as my colleagues shout Capital Gain Tax (CGT), the control of the cost of transport is part of the fiscal consolidation that would result in the containment of the fiscal deficit. That will have a significant influence on the cost of money and this is being done.

 

Madam Speaker, the other issue we need to address ourselves to is the rigidity in the banking sector. It has been observed that there are low levels of deposits amongst the citizens and therefore, the banks are relying on institutional investors. Consequently, they are passing on that cost to the people. We have to begin to encourage the elevation of deposits levels because that is the practical way that we can address the issue of cost.

 

In the area of access to finance, the impediments were articulated concerning collateral. The Government has addressed some of those impediments. The first is the use of mobile assets as security to access money from the banks. Therefore, an individual can technically use a goat or a chicken as security for borrowing money. These facilities are available for the MSMEs. Perhaps what we have not done effectively is the communication and the sensitisation of the people that there are opportunities that can be used.

 

The second measure that has been done is the establishment of the credit guarantee, in which the scheme underwrites 50 per cent of the collateral. Again, it is sensitisation of the people that is required to be done. Therefore, Madam Speaker, the issues of cost and access to finance are being addressed which is part of the functioning of the equal system.

 

Madam Speaker, the other issue that was raised is on facilitation. My colleague from the Ministry of Commerce, Trade and Industry is going to address himself to some of the issues on facilitation.

 

Madam, reference was made to Southern African Development Community (SADC) and Common Market for Eastern and Southern Africa (COMESA) respectively. One of the issues under COMESA is the simplified trade regime. All it says is that if a person brings in goods up to US $2,000, there will be no tax charged. This facility is meant to facilitate the business of the MSMEs and all we need is to sensitise the people.

 

Under business facilitation, Madam Speaker, we have secured a facility, for example, for aquaculture worth US $54 million, which will be administered through the Citizens Economic Empowerment Commission (CEEC), hence giving opportunities again to the MSMEs and that is important.

 

We have also facilitated the issue that was raised by Hon. Dr Kambwili. Hon. Dr Kambwili was given an opportunity to construct toilets and other things. These are some of the contracts that we are giving to the Zambians.

 

Interruptions

 

Dr Kambwili: Awe! No! On a point of order!

 

Mr Mutati: Therefore, this is a business opportunity that is being extended to the Zambians.

 

Interruptions

 

Dr Kambwili: On a point of order, Madam Speaker.

 

Interruptions

 

Mr Mutati: Mr Speaker, Mr Speaker, Madam Speaker …

 

Interruptions

 

Madam First Deputy Speaker: Order!

 

Hon. Minister, please take your seat so that I can help calm the hon. Member of Parliament for Roan.

 

Dr Kambwili: Yes!

 

Madam First Deputy Speaker: I think that the hon. Minister made that statement in very good faith as an example of how they are empowering local businesses.

 

Interruptions

 

Madam First Deputy Speaker: The hon. Minister of Works and Supply may continue with his debate.

 

Mr Sikazwe: Hammer him, mudala!

 

Mr Mutati: Madam Speaker, I am referring to the statement that was made by the hon. Member of Parliament for Roan. He said that he was given an opportunity under Mwamona project to carry out some works.

 

Mr Sikazwe: Mwamona!

 

Mr Mutati: That is empowerment on a practical basis. The fact that the Minister of Finance paid K200 million to various local contractors is also part of the empowerment process.

 

In the road sector, a week ago, 20 per cent of the contracts were being signed under Avic International by local people, which is part of the facilitation of empowerment. Therefore, the Government is doing what it must do by giving opportunities to the local people.

 

Madam Speaker, the third issue I wish to talk about is the legal framework. It is not the absence of laws that is the problem, but the application of the laws by our own people. The Minister of Justice has always bemoaned that he is not competent enough to bring up legislation that is going to legislate against immorality. He has no capability to bring such a law. What this simply means, Madam Speaker, is that we have laws that stipulates how non-Zambians can trade in markets. We have legislation that protects the issuance of forest permits. The laws are there, but our own people are sub-contracting these opportunities to foreigners.

 

However, the issue we must address ourselves to is, what is it that we really want? The solution is the need to sensitise the people. They must learn that they cannot cry poverty when they are passing on the opportunities to other people. What they need to do is address their own issue. For example, if I am given a licence to sell in the market and I pass it on to a foreigner, would I then blame the Government? I should first of all look at myself.

 

Hon. Government Members: Hear, hear!

 

Mr Mutati: I need to address and solve my own problem.

 

Mr Lubinda: Kamba futi!

 

Mr Mutati: Therefore, the problem is not them, but the problem is with us.

 

Hon. Government Member: Hear, hear!

 

Mr Mutati: We need to start with ourselves in order to make the mindset change. The ability to externalise the problem without first of all searching one’s soul, is what Zambians must do differently. It is not an issue of the laws, but the mindset change.

 

We glorify and are competent in debating and in passing on blame, but we do not do the same in changing our own circumstances. Therefore, the hon. Minister of Justice will still remain incompetent to bring legislation that deals with immorality. That capability he will never have.

 

Mr Lubinda: Hear, hear!

 

Mr Mutati: The capability that he must develop is to assist sensitising the people that these things are theirs and they must be able to move forward.

 

Madam Speaker, the fourth point I wish to talk about is on what the hon. Minister of Commerce, Trade and Industry is doing by supporting anchor investors. Only a couple of weeks ago, he accompanied His Excellency the President, to Global Industries in Masaiti. This is an industry that is supporting over 5,000 farmers by providing opportunities.

 

Last year, the hon. Minister for Luapula Province held the Expo, where now cassava has moved from a subsistence activity to a commercial and empowerment tool.

 

Therefore, these things are there, what we need to do is to stand up and go. We cannot make a difference while seated, thus we need to stand up and go.

 

Madam Speaker, opportunities and access to finance is there, but what is lacking is the connection. This connection is our inability to do something about our circumstances blaming them and not addressing our limitation. Therefore, the first thing we must do as a country is to look inside before we look outside.

 

Madam Speaker, I thank you.

 

Hon. Government Members: Hear, hear!

 

Mr Lubinda: Ba police!

 

The Minister of Home Affairs (Mr Kampyongo): Thank you, Madam Speaker, …

 

Mr Kampyongo: … and, indeed, I will be brief in my debate because most of the things have already been debated by the hon. Minister of Works and Supply. Basically, I will just ride on the issue of mindset.

 

Madam Speaker, the Government has provided the necessary environment for the Zambian SMEs to take their space. The mover of your Committee’s Report emphasised the point that the MSMEs must take their space. How can Government go and whip people to take their space?

 

Madam Speaker, if we went to the Citizen Empowerment Commission (CEEC) today and got the debt profile of the Zambian MSMEs who have accessed funds from CEEC and checked how they are paying back, you would find that the performance of the loans that have been given to Zambians are extremely poor. How then do we get them to build each other? Therefore, we have to encourage the change of the mindset, which the hon. Minister talked about. People should appreciate and understand that the opportunities we have are supposed to build us.

 

Madam Speaker, the construction which the hon. Member for Roan talked about is graded according to capacity. Each capacity of contractors is graded such as  six and what scope of works we are able to carry out in order for us to move from Grade six to Grade five, four and eventually, to Grade one. Believe you me, Madam Speaker, our local contractor, I as Minister of Home Affairs, am desperate to provide housing for my officers, who are living in deplorable houses. For instance, if I give a contract to a Zambian and say that I need the houses within ten months, I will have to chase the contractor day and night. The same Chinese we are complaining about will get the jobs with the same conditions and same contractual obligations such as 100 days just to mention a few.  For instance, Mwamona Investment Limited is given sixty days and the Chinese company is also given sixty days to do the job, but there is a guarantee that the Chinese who has been given sixty days will deliver the houses and …

 

Mr Lubinda: What about Mwamona Investment Limited?

 

Mr Kampyongo: … you will find that Mwamona Investment Limited …

 

Laughter

 

Madam First Deputy Speaker: No, no!

 

Hon. Minister, you cannot take that route.

 

Mr Kampyongo: Madam Speaker, I would like to withdraw that statement.

 

Madam Speaker, the point I am emphasising on is that our people must take their space because opportunities are there. When they are offered 20 per cent of the contract to carry out some works, they would go back to sell to the same person who has given the 20 per cent. How then are we going to manage the 50 per cent, which Hon. Dr Kambwili was talking about? Like the hon. Minister of Works and Supply was saying, we shall continue blaming ourselves as long as people are not sincere with themselves because there must be sincerity in what we do.

 

For instance, if an MSME entrepreneur wants to access funds from the CEEC for a project to grow Cashew nuts, but gets an economist consultant to write a business proposal for to enable him/her access the funds, the consultant will write it in him/her own language and convince the CEEC to release the money. What is in the mind of the small entrepreneur is something else. They would first of all want to go and buy a Mercedes Benz because they have seen someone driving a Mercedes Benz. The same applies to contractors.

 

Madam Speaker, the same Chinese we are complaining about will go and live in the village in   Shang’ombo or wherever the contract is and make sure that the job is carried out, but the Zambian contractor would want to be in Lusaka driving a Mercedes Benz from an advance payment and want the job to execute itself. In the end, the failure to deliver is visible to everyone. Probably, even the multiplication of wives I am hearing from an Easterner behind becomes evident from an advance payment before performance.

 

Laughter

 

Mr Kampyongo: Madam Speaker, these are matters which we need to deal with. Therefore, as leaders, we must start addressing the issue of mindset change so that the people appreciate the opportunities which are availed to them and utilise them to grow the MSMEs or else, they will continue crying. For everyone who wants to see the reduction of foreign contracts, we must apply ourselves properly.

 

At the Ministry of Home Affairs, we are part and parcel of the facilitation of traders, contractors and we are implementing Zambianisation. When it comes to the issuance of work permits to expatriates, we make sure that we give conditions which state that only the skills, which are not available on our local market are the ones whose permits we are going to facilitate with a condition that there must be understudies to the expatriates who will come to carry out the works. The same applies to trades. We are part of the Common Market for Eastern and Southern African (COMESA).

 

Madam, when the protocols are signed, they are not meant to disadvantage others. We would want them to be to our advantage. We are a land-linked country and we are so much of a transit country. Therefore, we can maximise our position to grow the MSMEs, especially those who are in trade.  

 

Madam Speaker, closing our borders to the rest of the world will not result in our industries growing. The only thing we should do collectively as leaders is to agree to help our people transform their thinking and appreciate themselves.

 

Madam Speaker, what we are talking about is exactly what is happening. Hon. Chitotela will give contracts to local contractors, but they do not fulfill the contracts. Someone gave an example of AVIC International Zambia building houses for the Ministry of Home Affairs. This is happening because we are desperate. If you go to the camps where police officers live, you will find that the situation leaves much to be desired. Therefore, I cannot be chasing after a Zambian contractor who will just build one house today and the other one next month. I will not have that time. I want houses to be given to my officers as soon as possible, so that they can serve the people better. Therefore, the Zambian people must take up the mantle by transforming their minds and appreciating that it is only they themselves who can get them out of the shackles of poverty.

 

Madam Speaker, I thank you.

 

Madam First Deputy Speaker: We have to conclude this Motion before 1255 hours and I do hope that the hon. Minister of Commerce, Trade and Industry will not necessarily exhaust the twenty minutes.

 

The Minister of Commerce, Trade and Industry (Mr Yaluma): Madam Speaker, since most of the main activities regarding the MSMEs have been taken care of by my colleagues, I will only highlight the policies on commerce, trade and industry. Initially, the policy for commerce, trade and industry was one and was not very elaborate or tailored to meet the requirements or expectations of the people of Zambia at large.

 

Madam Speaker, what we have done right now is hive off the industrial policy out of that and make it one so that the people of Zambia would be serviced properly and get benefits from this document. I will talk about that policy later on. We have also moved ahead to have the trade policy stand alone so that we can dwell on the nitty-gritty issues which are faced by the people. The trade policy is going to Cabinet on Monday because there were some issues which had to be revised.

 

The commerce policy will also be sent to Cabinet soon. Two weeks ago we launched the Commerce, Trade and Industry Strategic Plan for 2018 to 2021. This is all meant to make life easier for the MSMEs. We have also moved forward to release the local content strategy to show that the Government means well for small scale entrepreneurs.

 

Madam Speaker, let me now talk about the MSMEs. The Government is very committed to ensure that we uplift the participation and business trends of the MSMEs as they are trying to grow their businesses. We have said that we will focus on the MSMEs and ensure that they grow their businesses. The question is; how do we do that? We know there will be limitations as was highlighted by the hon. Member of Parliament for Chifunabuli.

 

Madam Speaker, in the past, the MSMEs have not grown so much because of a lack of skills training. We need to infuse skills in people running scale industries so that we build capacity for them to manage and sustain their businesses. Small businesses need to grow from hand to mouth into bigger enterprises. We have gone out to talk to our co-operating partners to ensure that they tailor some programmes specifically for the MSMEs. We have even talked to the Technical Education, Vocational and Entrepreneurship Training Authority (TEVETA) in this regard, as it was highlighted earlier, to ensure that the MSMEs are trained. We have to build their capacity so that in the next five years, the MSMEs should be doing alright.

 

Madam Speaker, people managing the MSMEs must be mentored so that they can see where they go wrong and if they need to grow their seed capital, then, we can go ahead and increase that, but they go into businesses blindly, without the knowhow, and have no long term plans. We want to make them understand business principles. We want even the smallest trader selling tomatoes at the market to be trained, so that they can grow their business in the next few years.

 

Madam Speaker, the Citizens Economic Empowerment Commission (CEEC) was formed to empower the local people. However, the biggest problem at the CEEC is that they have given loans to people who are unknown. We want the people who need to be empowered to grow their businesses to get the loans. Therefore, the Government is trying to reform the CEEC so that the monies from there can reach the intended people. That is the money that will be used as capital

 

Madam Speaker, let me talk about why the industrial policy was hived off from the main policy. It was done to protect the local manufacturing industry, which has died in the country. There is no manufacturing industry to talk about in this country because of huge imports. We are trying to grow the manufacturing industry relying on what is contained in the Seventh National Development Plan (7NDP). We need to diversify and see that industrialisation takes place, but how do we do that, we need to protect the non-traditional exports and that is why the 7NDP talks about building and protecting the manufacturing industry.

 

Let me give you an example. Coca Cola is trying to terminate the contract with the people they appointed to produce Coca Cola with the concentrates they send into the country. How do we protect our local industry? Can we let Coca Cola terminate the contract and send the concentrates to another country, Zimbabwe, for instance, and then we start importing Coca Cola or Mazoe from Zimbabwe? We cannot accept that.

 

Madam Speaker, we need to protect our local industries and that is the main point. We are looking for investors to come and invest in the Multi-Facility Economic Zones (MFEZs) in the country so that we can promote the Zambian manufacturing industry. However, if we do not allow the local people to participate in local industries, we will not achieve what we want. Currently, it is expensive for a Zambian to go and set up their business in a Multi-Facility Economic Zone (MFEZ). The threshold money they need is US$500,000, and that is a lot of money to a Zambian. That US$500,000 threshold should be for expatriate investors, and for Zambians, we must look for an amount which is attainable to them. This will help them go into manufacturing. We should protect our local industry.

 

Madam Speaker, yesterday, I was launching the African Growth and Opportunity Act (AGOA) Strategy for Zambia. What we are doing is encourage the small-scale enterprises such as those who manufacture and process honey and those packaging dried foods. There is an open market in the United States of America (USA) and these traders do not have to pay duty on those products. It is a preferred market based on an understanding we have entered into with the USA through the Southern Africa Trade Hub. That is helping to grow the small-scale businessmen and women as well as the youth. This is to ensure they have access to that market and can be promoted here in Zambia. That is something we, as Zambians, must embrace and run with. However, it will be very difficult if we do not look at means and ways of supporting these small-scale industries.

 

It is my view that as a ministry, we need to support and put up policies that are highly conducive to ensure that the small-scale industries are favoured. However, this can only be achieved if we first give the people initial training and build capacity for them. Doing that will enable them to understand what the acumen of trying to go into a business is. They need to understand whether to go into business for hand to mouth or whether it is to grow the business so that in future, they can graduate from a small-scale business man or woman to a medium-scale business person until they become large scale. We must also give opportunities to these people to go into joint ventures with foreign entrepreneurs so that there can be a transfer of skills and technology to our Zambians. That way, in future, they can stand on their own two feet. If we do not do that, we will always have an issue with small-scale entrepreneurs.

 

Madam Speaker, I would like to put on record that we go ahead to get licences for small scale miners. We must get these contracts as small-scale enterprises and refrain from taking those licences and selling them to foreign companies because that is depriving us of the income and the employment that would be created for our people because small-scale enterprises support the economy, except that we have not managed to monitor the extent to which they do that. Therefore, we need to give the small-scale miners an opportunity to team up as a consortium or joint venture with foreign investors so that they can grow.

 

Madam Speaker, indeed, it is regrettable that some of the activities or contracts involving small-scale enterprises which we have seen are being undertaken by foreigners. We will try to ensure this through the other policy that is coming up. We want to sign a Statutory Instrument (SI) to heavily surcharge the foreign investors in an effort to discourage them from bringing poor quality products into our country. We will soon issue an SI to ensure that we stop the flooding of our market with cheap products like chiffons and cheap jeans so that Zambians can also participate. They used to sell those things from salaula, but today, it is a different story because other people are also getting involved in that.

 

Madam Speaker, with regard to the supporting of our own small scale industries, the zonal enterprises in the MFEZ have been instructed to get services from our people. Suppliers must participate in that so that the components required to run their industries are supplemented by the local people. We are ensuring that backward linkages are taking place to support locals to bring small products to support their businesses so that Zambians can create wealth and employment for those people.

 

Hon. Member: Finally.

 

Mr Yaluma: Finally, ...

 

Laughter

 

Mr Yaluma: ... the essence of the industrial policy is to ensure that we give an opportunity to the Zambians to participate in manufacturing. We have highlighted a few things like the need for non-traditional exports so that Zambians can participate. By so doing, we are allowing Zambians to participate in manufacturing which will enable them to create wealth and at the same time, ensure that Zambia will be on the road to industrialisation.

 

We said that our diversification and industrialisation agenda will only take place if we grow our manufacturing industry in the country and that is what we are looking at. We need to grow it and protect our local industry.

 

We are reviewing the Zambia Development Agency Act and the Citizens Economic Empowerment Commission Act. We are trying to reform both Acts in order to ensure that we make it possible to achieve what is contained in our diversification and industrialisation agenda for the future.

 

I thank you, Madam Speaker.

 

Hon. Government Members: Hear, hear!

 

Dr Musokotwane: Madam Speaker, I thank all hon. Members for their contributions to this debate.

 

I thank you, Madam Speaker.

 

Question put and agreed to.

 

REPORT OF THE COMMITTEE ON CABINET AFFAIRS FOR THE SECOND SESSION OF THE 12^TH NATIONAL ASSEMBLY

 

Dr Imakando (Mongu Central): Madam Speaker, I beg to move that this House do adopt the Report of the Committee on Cabinet Affairs for the Second Session of the Twelfth National Assembly laid on the Table of the House on 12^th June, 2018.

 

Madam First Deputy Speaker: Is the Motion seconded?

 

Mr C. Zulu (Luangeni): Yes, Madam Speaker.

 

Dr Imakando: Madam Speaker, based on its terms of reference as set out in the National Assembly Standing Orders, your Committee considered two topical issues, namely:

 

(i)         management and operations of various departments under the Cabinet Affairs portfolio; and

 

(ii)        human resource management in the Zambian Civil Service.

 

Madam, your Committee also undertook a tour of provincial administration offices and selected district administration offices in Southern and Western provinces.

 

Madam Speaker, I am certain that hon. Members have taken time to read your Committee’s Report and therefore, I will only highlight some salient issues starting with the study of the management and operations of various departments under the Cabinet Affairs portfolio.

 

Madam Speaker, following the establishment of your new Portfolio Committee known as the Committee on Cabinet Affairs by the National Assembly of Zambia in December, 2016, your Committee resolved to receive an update on the management and operations of various departments under the Cabinet Affairs portfolio on which your Committee’s mandate is centred.

 

Madam Speaker, this august House recognises the critical role that Cabinet Office plays. Cabinet Office is responsible for the day to day supervision and efficiency of the Civil Service and is also the secretariat of Cabinet. To perform these roles and ensure that it provides effective leadership that affects the entire Civil Service positively, Cabinet Office requires adequate financial, human and material resources. However, your Committee observes that Cabinet Office has inadequate financial, human and material resources leaving it in a weak position and, therefore, constrained to perform to expectations. It is undisputable that, as the highest administration office in the entire Public Service, Cabinet Office needs to be well resourced.

 

Madam, your Committee recommends that the Government should adequately capacitate Cabinet Office in terms of financial, human and material resources. The nature of the office dictates that it maintains a well-trained cadre of staff and that it be given sufficient financial resources to lead the Civil Service in ensuring effectiveness, efficiency and high standard of integrity and professionalism.

 

Madam Speaker, your Committee bemoans the inadequate capacity by the Office of the Vice-President to effectively respond to emergencies. Your Committee is particularly concerned that the nation is ill-prepared to respond to disasters such as floods and droughts. The country has been experiencing floods and droughts in the recent past and these are likely to occur again, especially that the country is experiencing changes in weather patterns as a result of climate change.

 

Madam Speaker, the budgetary allocation of the Disaster Management and Mitigation Unit was increased from K13.6 million in 2017, to K54.5 million in the 2018 National Budget. With this increased allocation, your Committee urges the Government to take disasters seriously and prepare for them adequately.

 

Madam Speaker, I now turn to your Committee’s study on human resource management in the Zambian Civil Service.

 

Madam Speaker, your Committee observes with concern that there are a lot of frozen positions that are vacant in the Civil Service. While it is appreciated that freezing positions that have remained vacant for a specified period is one way of ensuring that there are no ghost workers on the pay roll, this has affected staffing levels in a number of departments with some operating with less than the required number of staff, thereby, impacting negatively on service delivery. For example, the Southern Province has about 1,294 frozen positions. Your Committee is of the view that controlling officers, Public Service Management Division (PSMD) and the service commissions are collectively responsible for the huge number of frozen positions. In this regard, your Committee urges the Government to guard against the freezing of vacant positions by filling them promptly.

 

Your Committee also recommends that Cabinet Office should engage the Treasury on the possibility of providing funding to unfreeze essential positions countrywide in the 2019 National Budget.

 

Madam Speaker, your Committee notes that the Government is implementing human resource management reforms that seek to, among other things, promote time processing appointments and promotions for all Public Service positions based on merit and progression. Your Committee is, however, concerned over the slow pace of the reform process. It notes that from inception, in 2012, the reforms were only given legal effect through the Service Commissions Act, No. 10 of 2016. The slow pace of the reforms has delayed a number of planned activities such as the delegation of human resource management functions and powers from service commissions to lower levels. Furthermore, the regulations to support the implementation of the provisions of the Act have not yet been made. In light of this, your Committee urges the Government to expedite the reform process and implement the reforms fully.

 

Madam Speaker, decentralisation has the potential to guarantee the involvement of the citizens in the planning of development and decision-making on the affairs that affect their lives on a day-to-day basis. Sadly, the national decentralisation process continues to be implemented at a slower pace than anticipated, thereby, negatively affecting the delivery of public services. Your Committee, therefore, recommends that the Government should regularly track the progress made in the national decentralisation process and ensure that decentralisation is implemented expeditiously.

 

Madam Speaker, your Committee bemoans the poor working culture and rising indiscipline in the Civil Service. Your Committee agrees with some stakeholders that this is mainly due to inertia in handling human resource matters by the officers responsible and supervising officers at lower levels. There have been cases of absenteeism and latecoming, among others. This is unacceptable. While it is noted that officers responsible may not have the power to discipline such officers, your Committee is of the view that they have the duty to perform their part of making recommendations on such cases speedily.

 

Your Committee, therefore, strongly recommends that the Government should urgently come up with measures to promote discipline and professionalism and boost the morale of the Public Service employees. These measures should include strict adherence to the values and principles of human resource management in the Civil Service such as qualifications, merits, impartiality and fairness in the exercise of disciplinary action. Furthermore, the newly employed officer should be sensitised on their roles and responsibilities and the terms and conditions of service in the Civil Service.

 

Madam Speaker, your Committee notes the Government’s plan to operationalise the national school of Government, which will help orient newly recruited civil servants and build their capacity …

 

Madam First Deputy Speaker: Order! As the time is 1255 hours, I interrupt the proceedings and the debate stands adjourned.

 

(Debate adjournment)

 

_______

 

The House adjourned at 1255 hours until 1430 hours on Tuesday, 19^th June, 2018.

 

____________