VNc#2826: The 8th indispensable action – building the Indigenous Enterprise Ecosystem-IEE
By Comm. VPM Nyasulu aka @shikulu-LUBUTO
In article VNc#2726, divided in a couple of parts in the last few weeks, I argued that Zambia cannot build a productive economy on unproductive infrastructure. But isn’t infrastructure, infrastructure? why the emphasis on qualification of productive or unproductive infrastructure?
It needs to be said that infrastructure is more than roads, bridges, power lines and buildings. There is another question we must confront: where, exactly, will Zambia’s indigenous entrepreneurs produce? i-MSMEs definitely need an indigenous enterprise ecosystem-IEE!
Whereas it is important to train an entrepreneur, provide access to affordable finance, open Government procurement markets, localise value chains, simplify regulations and provide productive infrastructure but if the entrepreneur has nowhere affordable, appropriate and properly serviced to operate, much of that potential remains a pipe dream.
The eighth (8th) indispensable action is therefore for the Government of the Republic of Zambia-GRZ to deliberately build an IEE across Zambia i.e. from individual businesses to enterprise ecosystems.
For too long, we have treated i-MSMEs as isolated individual businesses. One entrepreneur operates from a backyard. Another from a rented shop. Another from a garage. Another from a market stall. Another from an improvised workshop.
This may demonstrate extraordinary entrepreneurial resilience. But it is not an efficient foundation for industrialisation. Industrial economies do not merely have businesses. They have IEEs in which businesses have access to shared infrastructure, suppliers, skills, technology, finance, markets, logistics, standards and business-support services.
Zambia must deliberately build such ecosystems for i-MSMEs. GRZ must build indigenous enterprise Zones
This GRZ should establish a national network of indigenous enterprise and production Zones in the industrial parks dotted around the country. These should be deliberately located not simply where land is available, but where economic opportunity exists.
Each zone should be designed around the productive strengths of its locality. Agricultural areas should support processing. Mining regions should support engineering, fabrication and mining-supply enterprises. Urban areas should support manufacturing, services, technology and creative industries.
Tourism regions should support hospitality, food processing, crafts, transport and tourism-supply businesses.
The principle should be: build where production can happen—not merely where buildings can be constructed.
Shared facilities can democratise Industrialisation. Large corporations can afford expensive machinery, laboratories, warehouses and processing facilities but most i-MSMEs cannot. This creates an enormous structural disadvantage. GRZ should therefore facilitate common-user production facilities where multiple indigenous businesses can access machinery and infrastructure on affordable terms.
These could include: Food-processing facilities; Industrial kitchens; Cold rooms; Packaging centres; Furniture workshops; Engineering and fabrication centres; Textile and garment facilities; Agricultural machinery centres; Testing laboratories; Product-development laboratories; Digital fabrication centres and Warehousing and distribution facilities. The entrepreneur should not always have to buy the entire factory.
Sometimes the entrepreneur simply needs affordable access to the factory. That distinction could transform the cost of entering production. Enterprise zones must become business-service zones. A productive enterprise zone should not consist merely of industrial sheds. It should bring essential business services together. An entrepreneur should be able to access:
Business registration. Tax support. Accounting assistance. Standards and certification. Financial services. Digital services. Training. Legal advice. Market information. Procurement information. Export support. Technology and innovation services.
This would reduce the enormous transaction costs currently imposed on i-MSMEs in Zambia currently.
Instead of sending an entrepreneur from one Government office to another, we should increasingly bring the relevant services to the entrepreneur and make Local Authorities (Councils) economic actors not white elephants!
Local authorities must become active participants in enterprise development. Markets, trading spaces, workshops, parking, waste management, water, sanitation, land-use planning and local roads directly affect the viability of i-MSMEs.
Councils should therefore have explicit local economic-development responsibilities. Every district should know:
• What can we produce here? • Who is producing it? • What infrastructure do they need? • What markets can they serve? • What value chains can we develop?
That is how decentralisation becomes economically meaningful i.e. building IEEs around comparative advantage: Zambia does not need every district to manufacture everything.
Napita mukwai!
___________________________________________________________________________ The Author can be reached on +260 955 746 997 or via email at vpmn69@gmail.com
