Saulos Chilima & the Devil

There comes a point in a leader’s life when they have a critical choice over an important matter. The decision they make defines them forever.

Saulos Chilima & wife
© AFP. Saulos Klaus Chilima, accompanied by his wife, Mary, waits to be screened at Lilongwe High Court, where judges later annulled the May 2019 election,Lilongwe, Feb. 3, 2020.(Photo by AMOS GUMULIRA / AFP)

There is a little known African proverb which says Cross the river in a crowd and the crocodile won’t eat you.

It’s a metaphor which has been interpreted to mean people can achieve great things as a group rather than as individuals even when faced with danger; its the classic proverb meant to encourage collective action against innumerable or otherwise monumental challenges, even when there is danger (symbolised by the crocodile) and an obstacle or uncertainty of large proportions (i.e. the river).

But the metaphor can also be invoked to mean if someone undertakes an action together with a majority, they are unlikely to face the wrath of the masses (symbolised by the crocodile) sometime down the line since when making the decision, the person didn’t think only about themselves but took the decision (i.e. crossing the river) together with the crowd.

However, the kind of ‘crowd’ (and more generally partners) one chooses to mingle or intertwine themselves with when faced with a challenge matters.

While some crowds can elevate you, and propel you to greater heights far beyond your original standing, other partnerships can pull you down or even destroy you altogether (‘feed you to the crocodiles’). Knowing one from the other can be the difference between survival and catastrophe.

Malawi has recently experienced a monumental and historic moment in its democracy. In a landmark judgement, Saulos Klaus Chilima & Lazarus McCarthy Chakwera v Arthur Peter Mutharika & Electoral Commission, a unanimous bench of the High Court of Malawi sitting as a Constitutional Court nullified the country’s May 2019 elections and ordered that fresh elections be held in 150 days. Malawi is the second African country to nullify a presidential election, after Kenya. The court further held that a proper interpretation of section 80(2) of the Constitution of Malawi requires that presidential candidates garner 50% + 1 votes to be duly elected, effectively striking down the first past the post system for presidential elections.

However, now that the Constitutional Court has clarified the 50% +1 issue, it means it will now be difficult for any political party to win an outright majority in an election. It means parties must enter into alliances to be able to form a government, as is the case in many other countries around the world.

Critically, it also means Saulos Chilima and his United Transformation Movement (UTM) party will most likely become the kingmakers. This gives him a lot of influence because it means whoever he decides to work with will have to offer concessions or policy promises which appease the UTM block, which only has 4 MPs in Malawi’s 193 member Parliament.

There has been speculation that Saulos Chilima is open to working wth the Democratic Progressive Party (DPP) of Peter Mutharika, the same party from which he resigned in 2018. In particular, several sources have told me that senior advisers around Chilima think it is feasible and not preposterous for UTM to get into an Alliance with DPP to contest the upcoming fresh elections, which the Constitutional Court ordered should be held within 150 days of its judgement.

Mind you, this is the same DPP which has been called by some Malawians as “our common enemy”. It is the Same DPP which has presided over numerous corruption cases, over accusations of nepotism and cronyism; a government that tried to intimidate those protesting in the streets and labelled them terrorists, shielding police officers when they committed sexual assault and raped women and girls in Msundwe. The DPP government has abandoned our hospitals in Malawi as people die because of inadequate medical care and lack of medicines while party cronies swim in unexplained wealth, and can afford medical attention abroad; this is the party that said nothing regarding an attempted bribery of the judges presiding over the Constitutional Court case – resulting in an unknown magistrate quashing the warrant of arrest of one of the suspects of the bribery (later the warrant was restored by a High Court Judge).

But most of all, the DPP government has presided over a corrupt, rotten and unprofessional electoral body, the Malawi Electoral Commission (MEC) which the Constitutional Court revealed conspired with DPP to defraud the people of Malawi, of a free and fair election.

Is that really the kind of party Chilima now wants to associate, let along re-align with?

When Saulos Chilima left DPP, he insinuated many things about his old party’s excesses. Among the things he said were the following words, which many thought pointed to the rot within DPP. In an interview with Reuters News Agency, Chilima said: “I have been vice president for the last four years. I’ve had no support within to fight corruption, so the best way is to run for the highest office and then take corruption head-on”

I have been vice president for the last four years. I’ve had no support within to fight corruption, so the best way is to run for the highest office and then take corruption head-on

So contrast those words with the murmurs that a UTM – DPP alliance is still on the cards, and it’s easy to see why some of his supporters are livid.

Whether he realises it or not, this is the moment when ‘the dark side’ attempts to coerce an upstanding leader who up until now has made more right moves than wrong ones; this is the moment dark forces attempt to seduce someone into lowering their political standards against their better judgement, with potentially catastrophic consequences; a wanton and reckless decision devoid of any wisdom or forethought, one that would destroy their reputation, including any good fortune, high esteem held or respect the public had of them.

Here, a bit of context is necessary in that most of the people around Chilima have never held political office, either as elected representatives, or by being appointed to an official role besides an elected representative. So you’d think some of the advice they give will at best be taken with a pinch of salt.

But Chilima’s predicament is not unique to him or indeed Malawi. Many other leaders throughout history and in literature have been faced with challenging situations of one type or another.

This is the moment narrated in the Gospels of Matthew, Mark and Luke, when Jesus no doubt exhausted and hungry from fasting forty days and forty nights in the wilderness, is taken by the devil to a very high mountain and showed all the kingdoms of the world and their splendour. The devil says to him in Mathew 4 verse 9: “All this I will give you,” he said, “if you will bow down and worship me.” to which Jesus replies: “Away from me, Satan! For it is written: ‘Worship the Lord your God, and serve him only”

When Geroge W. Bush was president, the unholy cabal of Dick Cheney, Donald Rumsfeld and other hawks convinced the malleable Bush with feeble if not dodgy intelligence that Saddam Hussein had Weapons of Mass Destruction (WMD). A decision to go to war led to the deaths of over 300,000 Iraqi civilians, (500,000+ people according to other estimates[Washington Post]) and forever labelled ‘Dubya’ , as he was nicknamed, as the US president who took the US into a phoney war. Not only did the Iraq War completely destroy large parts of Iraq, but it spurred hatred against the US in the region, and directly led to the rise of extremist groups, including that known as ISIS.

This is the moment Nick Clegg, former leader of the UK’s Liberal Democrats Party made the ultimate political error by allowing the UK’s Conservative Party under David Cameron (with whom the Liberals were in a coalition government, following an election that produced a hung parliament) to overrule his most important policy commitments on University Tuition fees; a mistake so grave it angered his party’s core supporters who punished the Liberal Democrats at the next election (held in 2015); his party’s MPs were fumigated from parliament like rats flushed out of a rat hole. They lost a whopping 49 seats and Clegg resigned as leader!

This is the moment in July 2011 when faced with demonstrations in Blantyre, Lilongwe, Mzuzu and Karonga, Bingu Wa Mutharika ordered a crackdown instructing riot police to fire teargas and live bullets in confronting them, leading to the deaths of 18 people. Malawians never forgave Bingu for that one single act.

It is akin to the moment Aung San Suu Kyi, once celebrated internationally as a champion of democracy, ignored widespread allegations of mass murder, rape and forced deportation in Rakhine state in Burma, and did little to act and protect the lives of hundreds of thousands of persecuted Rohingya Muslims, even after a UN fact-finding mission investigated the allegations and found compelling evidence that it said the Burmese army must be investigated for genocide against Rohingya Muslims in Rakhine.

Malawians have been taken for fools for a long time, and their peaceful nature and hopeful trust in strong-men (“abiggie”), abused by politicians of all colours; the kind who make false promises (“I will turn Malawi into Germany“) that can’t possibly be fulfilled.

But if there is one certain thing the recent protests in Lilongwe and across the country have shown, it is that Malawians will no longer be taken for fools. Going forward, no one will take the people of Malawi for granted anymore: Not donors, not foreign election observers, not local political parties, not local party leaders, not chiefs, not foreign investors, not Chinese investors …. NO ONE!

So, whatever Saulos Klaus Chilima decides to do now, whether to listen to the blue imp perched on his left shoulder whispering falsities into his left ear, or whether to heed the red imp on his right shoulder – the tambala wakuda – he can be certain without a shadow of a doubt of one thing: that the Malawian people are watching his every move. And that what he does next will most-definitely be his legacy that will define him forever.

In praise of the resourceful Nigerian

dev1.jpg

Nigerians are go getters…you just have to admire their fighting spirit. While there are many Nigerian conmen out there (who over the decades have tarnished the reputation of Africa, and Africans), there are many more honest and hardworking Nigerians doing some very interesting things – involved in some innovative businesses, so it’s no overstatement to say we can all learn from their ingenuity http://www.nairaland.com/2512295/top-14-nigerian-innovators-watch

Malawian entrepreneurs in contrast appear to be different. While this is a generalisation, some Malawian business people will see the purchase of a private jet or building of a hotel, and think that such is a sign of development or wealth…??

Instead of buying a private jet (in a very poor country) or building a shopping mall, Malawian ‘entrepreneurs’ who have significant capital resources should consider investing their money into something transformative that has a potential to create a massive industry, one that will improve the lives of large numbers of people, especially since Malawi is a country that needs to let go of it’s over-dependence on Tobacco. And this is not about social enterprises as you’ll see below.

To give an example, the Indians invested into call centres after China took over their manufacturing edge, and recently there has been an increase of so many Indian companies getting into industries like the provision of SEO services (they control 6.6% of the global market https://moz.com/industry-survey), building Apps and other businesses which are not only scalable, but have the potential to employ hundreds of thousands of people. That’s even before you mention Automotive (On top of Tata Motors, they also own Jaguar), … But back to Malawi for a moment; we cannot be building shopping Malls, Golf courses or Hotels and claim that such is a sign of development? Building Shopping Malls or Hotels only encourages consumerism, spending… spending… spending… it doesn’t increase the net worth of the majority of people, it doesn’t in itself help improve the lives of those who buy from those malls, and generate incomes for them. A shopping Mall will not increase your earning potential, and only benefits the few families who have the capital to set up shop in them, including those investors who own the Mall.

I would rather Malawians build institutions that provide skills to our people to enable them to be qualified so that they can work in sectors that manufacture goods and compete with the likes of Kenya, Vietnam, Malaysia and Brazil.

All well and good talking about wanting Africa to make stuff, to make motorcycles, cars, aeroplanes, refridgerators and whatever else… but are the people who will make those things sufficiently qualified?

Most people like to give an example of China, South Korea, or Singapore as examples which Africans should emulate, but what they forget to mention is that in these societies, a greater proportion of the workforce is extremely highly qualified (not in terms of just having PhD’s, but they have transferable technical skills: They understand Physics, Electronics and Engineering principles and Manufacturing processes, and can use such skills and knowledge to apply to problems with the hope of finding a solution. If a solution is found, they can come up with a product that embodies that solution). In addition many innovators fromthese countries are trained in business, unlike the situation in our African countries where too many people who run businesses don’t even follow the fundamental concepts essential for a successful business.
What Malawi should be striving for, is to equip it’s young people with skills so that they can become resourceful and attempt to solve the problems within their communities/ global challenges, and in the process increasing their earning potential.
Let me proivide another example. If a Malawian national had invented a device similar to this ocean cleaning bin http://www.boredpanda.com/floating-rubbish-bin-ocean-clean…/ it is possible with visionary leadership, a good strategy and the right kind of funding to create a factory that would employ 3000 – 4000 people in Malawi over 5+ years, making these devices within Malawi, and selling them all over the world. The invention would make huge profits for the owner of that company…. in any case, this is only a simple device, and there’s nothing too complicated about it. In my view it can even be made from dry reeds weaved in the same way as weaved baskets, so no excuse for the unavailability of raw materials:

reed-basket
In case you are asking why such a business would work, it has to be because sea / ocean debris is a real concern all over the world, and there is a huge demand (a market, which is an essential component for a product based business) for a simple device that can be made cheaply and deployed to clean oceans and lakes of all the plastic and other waste that’s thrown into them(waste that endangers marine life).
In contrast, even if a Shopping Mall or Hotel creates jobs for 200 – 300 people, comparatively it’s far less than what a factory making goods that can be exported globally has the potential to employ. Further, the money that shopping mall makes for the owner would be miniscule compared to the profits that would be generated by a product that is a commercial success globally.

The Eagle in a Storm

The following is a post (and ‘afterthoughts’) from the Facebook Page of Strive Masiyiwa, the Zimbabwean billionaire and  businessman wh is an inspiration to many Africans.

From reading the advice in his post, you have to wonder why many of our leaders in Africa are not thinking or approaching governance and development with such principles/ attitude:-

The Eagle in a storm (Part 2a).
__Changing our “wealth creation model.”

Ever since I started school, my teachers taught me that our country was “rich” because we had many minerals, and we’d recite the list of minerals. By the time I finished secondary school, I not only knew my country was “rich,” but that Africa itself was “rich” because we had so many natural resources.

Even though I didn’t study geology, I could almost tell you where all these precious minerals and other resources were found: oil, diamonds, platinum, gold, copper… in places like Congo, there were names of some things I couldn’t even pronounce.

__Yes, Africa is so rich!!!

As a young student, if I thought about what the global buyers of Africa’s natural resources then did with them, it was only ever a superficial thought. But I soon realized something didn’t add up…

__Sometimes it almost seemed that the “richer” a country, the poorer the people! But how could this be?

“1+1=2”! My primary school teacher drummed it into my head, right?

Then I got to secondary school and one day the teacher came in and said, “You know, there are situations when 1+1 does not always add up to 2.” ?!

“I’m here to talk about mathematics,” the teacher said. “It’s time to put away the arithmetic; this is senior school!”

“Senior school!”

I didn’t end my study of mathematics in secondary school. I also studied it at university where I majored in engineering.

What was it the Apostle Paul said about putting away childish things?!

Let me return to the wealth of our nations: I left university in the early 1980’s. In those days, it was not China that was rising into an economic giant, it was Japan! It was rising and overtaking every European country, until Japan was second only to America… It was so spectacular!

I first met a Japanese person when I was in my twenties and already working, yet I read every single book I could find about their prowess.

“Tell me about the minerals of your country?” I asked my Japanese friend.

“We have no minerals to talk of,” he said emphatically and proudly.

“What do you mean you have no minerals?”

As we talked about the Japanese rise, I was reminded of my lessons in mathematics!

And so I had discovered it was possible for a nation to be “rich” without minerals!

“We buy your minerals as cheaply as we can, and then we turn them into high-value products.”

“You mean you exploit us?”

“That’s not the way we see it. After all, what would you do with them if we didn’t buy them? Do you know what we do with your platinum or your oil?”

Then he added:
# “Our wealth creation model as a nation is not based on raw materials and minerals.”

“WEALTH CREATION MODEL?” What do you mean “WEALTH CREATION MODEL???”

Deeply troubled (even insulted) initially, I knew there was something more to learn if I avoided becoming emotional. The conclusions I reached changed the way I look at wealth, and totally empowered me. It changed my mindset.

The Tentmaker once said that our greatest battle is always in our minds… changing the way see things, particularly if we have held on to a certain perspective for a long time.

I hope it will do the same for you.

***

Afterthought 1. There’s a story told about a young Christian who was praying one day, and he asked God, “Why did you create the Universe?” And in his heart he heard God say to him, “Son, your mind is too small to contain my answer.” He’d ask the question again and again, making the subject of his interest ever smaller: “What about an ant?” Again the Lord answered him, saying, “Your mind is too small to contain my answer.” Finally frustrated, he picked up a peanut. Then (as the story goes) the Lord said to him, “let me give you a list of just 100 applications of the peanut that are yet to come!”

What do you know of the cocoa bean and its uses today? There are billion-dollar industries waiting to be created with the raw materials of your country, that the world doesn’t even know about today.

***

Afterthought 2. If you’re a school teacher, why not ask your students today to draw up lists of all the innovative things that are made from your country’s raw material exports.

__In just this alone, you will have taken the first step to changing our wealth creation model. If they’re in high school, ask them to draw up a list of nations that are very successful and yet do not have natural resources. In this you will change their mindsets about wealth creation.

***

Afterthought 3. If you’re a policymaker, ask yourself what incentives your country has put in place to encourage entrepreneurs, innovators and inventors to develop exciting new products and services, and to invest in industries that use your raw materials? What policies encourage investors to come in and set up industries that rely on those raw materials? What tax breaks will you give me if I set up a manufacturing business that uses the oil, platinum or cocoa of your country?

Why the Malawi Postal Corporation should enter the business of International Money Transfer

money-card

A few weeks ago, I watched a Christmas party video in which the speaker talked about remittances by migrants living in the UK, and immediately I got an idea.

Why doesn’t the Malawi Postal Corporation (MPC) enter the business of International Money Transfers? Not only in Malawi, but across the region…

In that video, the London mayoral candidate George Galloway said that if he is elected mayor of London in 2016, he will move to make City Hall enter into the business of International Money Transfers, except it will be done on a non-profit basis. It made me think about how Malawians particularly in the UK and the US spend so much on charges and fees to send money to their loved ones.

The choice of the MPC may seem like a random or even odd one, but it is not. The Malawi Postal services has a wide network of 180 Post Offices across Malawi and 154 postal agencies in the country. Surely with such a wide network, they must have the capacity to add an additional service of money transfer ontop of the other services which MPC already offers? The only difference would be that this service will not depend on Money Transfer Operators (MTO’s) such as Western Union, Moneygram or other services, thereby more of the benefit of the transfers will remain on African soil.

In any case, remittances to East and Southern African countries have been steadily increasing. In 2013, US$28.7million was sent to Malawi from abroad (up from US$14.5million in 2006, see Index Mundi here) and US$72.8 million was sent to Zambia  (Source: Examining the Relationship Between Received Remittances and Education in Malawi, Kasvi Malik, Claremont McKenna College, 2015). Zimbabwe received US$1.8 billion in 2013 (Source: Zimbabwe: Diaspora remittances in decline, The Africa Report), Tanzania received US$75.34million in 2012 and Mozambique received US$117million in 2010(data-World Bank)

In total the Overseas Development Institute estimates the total cost of fees charged by the Dallas based MoneyGram (whose 2014 revenues were US$1.45billion with $456.4million Gross Profit) and the Colorado based Western Union (whose 2014 revenue were US$5.6billion with $2.31billion Gross profit) to be US$1.8 billion (see Watkins, Kevin & Quattri, Maria. “Lost in intermediation: how excessive charges undermine the benefits of remittances for Africa.” Overseas Development Institute, April, 2014.Web. 20 March, 2015).

Surely this is money which should be utilised within Africa?

But why is this issue important?

Our Countries in Africa need money. Poverty lingers, our education systems are in tatters, we have high youth unemployment, healthcare crises, and in the face of illicit financial outflows, receding or suspended aid budgets, relatively small FDI’s and the corruption problem (which is far from going away), every penny counts.

Every penny must count.

The African Diaspora is a burdened community. The majority usually accept low-paying jobs, spend more money relatively than indigenous populations to establish themselves, are milked dry by extortionate immigration fees, have less social capital in the countries they dwell (therefore less access to informal or supplementary sources of funds), and fewer fallback protections than indigenous populations. In some countries, migrants have to pay more for healthcare, and for services which are free to the locals. They find it harder to access capital (with which to start businesses – which could help them financially), and on top of taxes, Social security / council tax, etc.. they have many mouths and responsibilities from family members back in their home countries, dependants who are often expecting dollars, pounds or Euros for their livelihood each month; to pay for rent, food, school fees, medical care and other expenses.

So how would the MPC Money Transfer scheme work?

On a very basic level, a non-profit organisation would be incorporated in the UK, the US, Malawi, Zambia, Zimbabwe, Tanzania, Kenya, South Africa and Mozambique, with bank accounts opened in all those branches.

The organisation would have one or two staff members based at the Malawian embassies in each of these countries. The Malawian government would deposit US$100,000 in each of the bank accounts, and when a remittance has been made, the organisation would level a 5-10% fee on the value of the remittance, as a cost for sending the money. A mobile app would be developed to make the job of transfering money easier, and contracts with banks and money gateways would be utilised to allow payments to other bank accounts or services in the participating countries on favourable terms. Any profits made at the end of the financial year after all the costs have been deducted would be donated to a fund to be used for job creation for youths, healthcare initiatives and other such purposes across Africa.

Obviously it’s not going to be as simple as that, and current market players are unlikely to want a new serious entrant with Social ambitions, but you get what I’m saying.

A few years ago, some people suggested that Diasporas Bonds (Read Economist article here) was the way for African migrants to help invests in their countries, but the scheme still depended on the likes of Western Union.

I acknowledge that the rise of mobile money has had a positive impact on empowering rural communities across Africa, but I’m not convinced that the benefit of such has been significant or evenly distributed among the people who use it. Indeed, it seems to me that a handful of entrepreneurs, and a few corporations (for example Orange SA who own Telkom Kenya, the part-owner of Safaricom, which owns Mpesa. Safaricom is also partly owned by Vodafone Group) have reaped the majority benefits of the mobile money revolution, meaning what mobile money has done, is made companies and corporations who are owners of the various platforms richer.

What I’m calling for is a scheme whereby our governments in Africa, as opposed to MTOs or private companies control a greater chunk of the pie, with a hope that such would lead to greater investment in services for the greater good of our people.

Why are some people opposed to black empowerment policies?

AfricanGirl

When the scribes of the Pharisees saw that He was eating with the sinners and tax collectors, they said to His disciples, “Why is He eating and drinking with tax collectors and sinners?” 17And hearing this, Jesus said to them, “It is not those who are healthy who need a physician, but those who are sick; I did not come to call the righteous, but sinners.”

– Mark 2 : 16 – 17

I’ve often been perplexed by the vehement opposition with which some people have against black empowerment policies. It’s quite strange since those policies are infact an attempt to remedy the clearly unacceptable situation where in countries like South Africa, the majority of the wealth is owned and controlled by a tiny white minority, while millions of black South Africans go by with too little.

And it’s not only in South Africa where this problem exists. Instead in most parts of Africa, we have a situation whether a tiny elite of individuals, businesses and corporations owns disproportionately huge amounts of resources, whereas the native population has very little in comparison. In the United States policies that embody what some call ‘positive discrimination’, for example Affirmative action,  have for decades attracted widespread and unfair criticsm. Having spent some time studying the views and opinions of people who are against Black Economic Empowerment (BEE),  I think I now understand their position more clearly, including the deep flaws in their arguments.

Racist

Over the last couple of years I’ve read opinions for and against BEE.  I’ve been both entertained and shocked, but in boths instances marvelled at the passion or lack of nuance in some of the attitudes in this space. Among the most common accusations against BEE is the cheap and totally lazy accusation that BEE policies are racist.

But hang on a moment….when you have millions of people in South Africa, and hundreds of millions of people across the African continent, who as a result of racist ideas such as Colonialism, Slavery (over hundreds of years), discriminatory and in some cases highly questionable if not altogether racist policies of western institutions, live with poverty and struggle to get by each day, failing to improve their lives, how can you be taken seriously when you attack such countries / leaders for trying to reverse the consequences of European racist Ideology?? How dishonest is that? If you agree that colonialism and slavery were wrong, then surely you should by implication also agree that those who have been affected by the long-term effects of these toxic ideologies deserve a helping hand to enable them to be financially independent. It’s only equitable.

But often these critics don’t suggest anything better that will have real tangible effects (provide affordable housing to people on incomes that are so low they cannot afford house prices unaided at the current levels;  create well-paying jobs to people who were previously unemployed, and unable to get a job; enable loans to be extended to people with bad credit histories – who would otherwise be unable to get loans elsewhere, etc), but are very good at ignoring the history that has created the deprivation in the first place.

Further, if after decades the disparities we see in society today continue to linger (and in some cases they have increased), are you saying the situation that is failing to rectify itself, and indeed can’t rectify itself without intervention- should be left just as it is?

If thats what they propose, then in whose interest and benefit will such be? If you ask me certainly not in the interest of black Africans who are the people who need help here.

And so you really have to wonder why these critics are making those accusations  when they have got no workable alternative idea to offer?

Wasteful

Another flimsy but entirely predictable accusation that is often levelled against the state in regards to BEE policies is that they are inefficient; that they suck up too many resources, for very little return. In essence these critics are applying well known business principles of investment and return to a social cause that is not readily measured in numbers. If a family is happy that they now have a new home, which is safe, and does not leak like their old house in the ghetto, how can you translate that into a mathematical or financial equation? It’s not possible, yet that happiness and safety is a legitimate measure of success of the initiative.

The rationale behind the accusation of wastefulness is rather questionable if not outright elitist. Think about it; when colonial governments across Africa acted in the interests of European countries alone, to extract huge amounts of resources from colonised lands for the benefit of Kingdoms and the Aristocracy in Europe, to build their cities and sustain their economies, forsaking even basic investment in healthcare, job creation, infrastructure, education, social services, the general well-being and economic advancement of the indigenous populations across the African or Carribean colonies, is it really that big a transgression for African countries to begin spending money on their people (who historically were maligned for hundreds of years)? What is so bad with aiding people who are unable to afford decent housing get good homes? Or helping low income workers get well-paying jobs- which their forefathers were prohibited from holding?

It will cause them to be lazy is the often the insensitive response you get from critics of BEE policies. But that’s not entirely accurate because by improving their lives you are also helping them be  in a position where they can take advantage of certain opportunities which they couldn’t previously be able to take advantage of. For example, if I now have a safe house to live in, with a refrigerator, I may want to start a business selling cold soft drinks in my neighbourhood – something which I wouldn’t be able to readily do in my old shack in the slums. I have electricity, so my children will be able to stay up late and use the lights at night to read books, and hopefully get better grades in school (books which they borrow from the newly built Library down the road – when previously they had to walk over 3 miles to get to a Library). They will be better protected from the elements – reducing the likelihood of disease, especially since that now I have better sanitation… Overall, there will be a great and immeasurable improvement to our lives.

What all this is, is spending money that the predecessors of these African governments (colonial and apartheid governments) should have spent on the indigenous populations decades ago, but which they didn’t spend for all sorts of reasons….

I mean, is it really such a bad thing for African countries to decide to achieve genuine economic equality? … when you have so much poverty and want across the continent…

OpenSewer-Nairobi
A boy sits near an open sewer in Kibera slum, Nairobi // Source: Wikipedia

The way I see it, if there had been fairness, and if throughout history black populations were treated humanely, and in the same way as white populations, with no systematic bias or ideological repression of one kind or another, there would be no need for BEE policies today, because the income disparities would not exist. The only reason we have BEE policies is because there is an unacceptable problem that was created throughout history, that in many countries still remains, and that urgently needs to be rectified.

Like the first accusation, those who attack BEE policies with the wasteful accusation fail to understand the real benefits these policies have on poor people. They too won’t suggest anything better that would achieve real results.

Here, please allow me to digress: I seem to see this pattern operating in the world today; that any leader of a non western country, who stands up to the global financial oligarchy, and who bravely begins ambitious Social  Policies to improve the lives of the poor people in  his or her country, almost always becomes the victim of vilification and attacks from the western media and the Bretton Woods institutions, who ignore all the good he or she has done. Two years asgo, soon after Hugo Chavez died, I overheard one member of my family saying to someone over the phone that Chavez was a bad man. After the phone conversation ended, I asked her how  she arrived at such a conclusion, and she recited back pretty much all the drivel that was written about him on the pages of newspapers such as the Times and the Guardian. Biased and one-sided tosh. When I explained to her  in detail what Hugo Chavez had actually achieved for the millions of people in his country, from the perspective of some of the people who had benefitted – the stories of which I had read, she could only muster a very feeble I didn’t know that…

Corrupt

This one is the loudest accusation, but like the other two, it also is not entirely accurate. Critics of BEE policies claim that the adminstration of BEE funds often becomes mirred in corruption. That institutions mandated to administer BEE funds become channels through which party officials and other corrupt types siphon state funds, and that there is widespread corruption involved in the process.

The question which those who throw this accusation fail to answer is why is the corruption happening in the first place?  Is it that there are too many Africans who are so deprived that when suddenly exposed to money, many embezzle funds? How much of that corruption is down to foreign companies paying bribes to gain business?

I’m not giving excuses for the corruption, but I think it’s important to ask the question what is at the root of such corruption?

In the UK for example, throughout the years there have been many corruption scandals (most recently the MP’s expenses scandal) which have thus far disappeared into the archives of history – it’s as if they never happened in the first place. It’s the same scenario in the US, Canada, Australia, Israel, Brazil, India…in all these countries with established democracies, politicians and people with close ties to politicians have been prosecuted, fined or even jailed for corrupt conduct of one type or another. Yet we don’t hear of it often partly because in some of these countries corruption (which still happens) was more widespread many  years ago than it is now, and the scandals occur further and further apart. Therefore,  on this basis alone, and considering that many African countries have been independent for little over 60 years, it is not crazy to surmise that the corruption  we see in Africa today, not only that said to be happening within BEE initiatives but across the board, must be understood as glitches in the developmental phases happening on the continent, just like the developed countries of today also had their dark days (when corruption was rife), during the early days of their representative democracy.

Opponents of BEE would thus be better advised to use their energies and precious time not in the vain and pointless exercise of shooting down policies that will help millions of black people, but to find ways of curbing the corruption most decent people are against- so that those policies are strengthened, and achieve better outcomes….

After all, we all want equality, don’t we ….? 🙂

In the next article on this topic, I will attempt to address the accusation of incompetence (whereby some critics claim that black Africans are unable to run or be in control of successful and profitable businesses rendering certain aspects of BEE policies harmful to business). I’ll also conclude by stating what I think to be the real reasons behind these accusations.

The inspiring young South African behind a township textile company

…Tshintsholo’s plan for the future is to one day open a pan-African bank so that the continent’s countries no longer have to borrow money from elsewhere in the world and remain ensnared in debt. But, in the meantime, he wants to focus on completing his education and growing production capacity in his textile factory.

His advice to other entrepreneurs is to have patience when it comes to growing their ventures and reaching their dreams.

“Even though in the short term things might look like they’re not coming together, as long as you have that long-term vision of where you want to go, you are on track to getting there. If you don’t know where you want to go, you can’t get there. So have a clear picture of where you want to be, and build towards getting there,” he highlighted….

The inspiring young South African behind a township textile company

The International minnows and their minions

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The term Minnow is an English noun used to denote a small freshwater Eurasian fish of the carp family, which typically forms large shoals.  The term has been used (among other definitions) to denote something that is small or insignificant, be it a person or an organization.

And I’m using it as the subject of this article because last week, the Hindustan Times quoted international affairs expert Dr Kanti Bajpai, who is professor at the Lee Kuan Yew School in Singapore, as saying India’s Narendra Modi’s decision not to make an address to the United Nations General Assembly at the 70th session may be interpreted as siding with an Indian school of foreign policy that doesn’t ‘..want to be in the company of the international minnows too long’

The writer of the article quotes Modi to have said of such international gatherings like the UN General Assembly, that there are “Lots of small countries with their small problems.”

It is therefore somewhat surprising, amusing let alone ironic when you read that some countries are taking large entourages to the very same gatherings at which they are somewhat frowned upon by delegates of much larger countries.

Uhuru Kenyatta travelled with 40 people, Malawi’s Peter Mutharika took an entourage said to have been around 110 members, whereas the Prime minister of Bangladesh had an entourage of 227 members!

Before he left, Peter Mutharika gave a speech which some commentators claim was effectively an SOS over Malawi’s problems. So why then take such a large entourage when he claims that Malawi is in trouble? In particular, the Government of Malawi recently conducted a Food Security assessment for the 2015 / 2016 period, which concluded that

  a total of 2,833,212 people will not be able to meet their annual food requirementt during the 2015/16 consumption period. This represents 17 per cent of the country’s total population.

It went on to state that the Government needed US$146.378 million to procure 124 thousand metric tons of maize to prevent a food shortage crisis which could quickly develop into a humanitarian crisis.

If Malawi had done some deals with investors and the economy was recovering, why would anyone sensible question the wisdom of going to the UN with a whole horde of people?

If Mutharika was taking the top 100 businessmen from across the country, irrespective of party affiliation (as most western leaders do when they travel to say Saudi Arabia, India or China)  to scout for opportunities, collaborations or business or to attend strategic meetings, why would anyone sensible question it?

The problem is Malawi is currently free-falling, Oil and gas licensing were suspended, the floods devastated land and crops, and will affect harvest, donors have pulled out of budgetary support and are refusing to resume, even the IMF has closed the taps, and you have a president taking loads of people to New York???

Between the president’s departure last week and today, we’ve learned that:-

  • The government of Malawi will be spending ~ K144million Kwacha on the airfares of Mutharika’s entourage.
  • That K238 million is being spent on accommodation alone for 111 people.  That makes a total of K352 million ($636,000) of taxpayer’s money being spent on Accommodation and airfares, without accounting for allowances, which are not coming in cheap.
  • That the president has hired a private jet – a Bombardier Global Express at a cost of US$4 million for the duration of th trip.
  • Speculation on social networks online is that the President’s step son is part of the entourage, as well as a chief and a PE teacher. We do not know if this is true, or why they went? How will their inclusion benefit the country or indeed what will they add to the trip?? Surely Malawians must be told why were they selected and what they will add to the trip?
  • Also part of the entourage is a lady who accompanied Mutharika only because the first lady is on the trip.
  • From one ministry 3 Directors went to New York, each with an allowance upwards of K9 million (US$16,000, and that’s besides the other staff members accompanying them)
  • Peter Mutharika and Ben Phiri are travelling separately so that they shouldn’t be seen in the same place, to give the false impression that Ben Phiri is not working for the government even when in reality he still is working for Mutharika.
  • There are some who claim the UN is paying for the trip, but our sources including some people close to government officials dispute this. Malawi is going to pay for their own bill, and any news that the UN is footing the bill is designed to mislead. If donors are paying why haven’t they explicitly declared so, seeing the situation in the country?
  • Last year, someone who went to the 69th Session of UN with the president blurted out in a drunken stupor,that he had been paid $10,500 for the days he was in New York. There is no reason to suspect that the officials accompanying Mutharika are being paid less this time around. Or is there?

Last year, Mutharika returned from a trip to the US and Malawians were told that he had received promises (or was it signed agreements) of investment totalling around US$600 million from some investors. While I can’t recall how many people he took along with him for that trip, how many of those investment promises he received have since materialised into real investment or real tangible projects?

I think there is need for more accountability and responsibility on the part of the presidency. Minimally, I think numbers of officials going to the UN should be capped at a figure such as 13, and allowances of officials of African government should be capped at modest sums. In particular, why should the head of state of a poor country sleep in Waldorf Astoria in New York , paying over $10,000 or is it $15,000 a night when millions of his country’s citizen are struggling with daily life, and live on less than $3 a day?  I think just as a matter of concern for other humans, for other people, just out of what in Malawi we call umunthu, expenses for all officials including the president should be capped at $500 a night. You can’t be that insensitive when people, real people in your country are suffering. It can never be right, and such selfishness is the cause of all human problems. I’ve seen this attitude again and again amongst the ruling class (even in Britain). There are some people who assume that just because they are doing well financially, everyone should be doing relatively okay. This is never the case.

So, all that these expensive trips do is give credibility to critics who dismiss them as self-enrichment schemes, which on some level they are.

When will Malawians leaders learn to be accountable? With all the poverty our country faces, should we really be throwing money around like this?

I think we should legislate to have laws that can remove representatives if they are unable to meet the expectations of their constituencies, or if they abuse their power. I think that is the way forward to counter corruption and self-enrichment.

Also, when the largest economy in Africa, Nigeria, took around 30 people (according to NAIJ.COM the number is 22) to the UN, does it really make sense for tiny Malawi, one of the poorest countries in Sub Saharan Africa, to be taking entire clans, complete with chiefs to New York?

Perspective

For those of you who say the amount Peter Mutharika will be spending is minimal, lets not forget that there are many American tech giants which began with capital of less than $4 million let alone $635,000. Facebook for example, a company now worth billions of dollars, once received $500,000 in seed funding from Peter Thiel , the PayPal Co-founder, in 2004, for a 10% stake. My point, the money Mutharika is wasting can be better invested into ventures that could greatly benefit the country in the short to medium term; it can be invested into young people, instead of blowing it on luxury and unnecessary spending at the expense of an already burdened tax payer.

One final thing … 🙂  the word minion. A minion, for those who do not know, is defined as a follower or underling of a powerful person, especially a servile or unimportant one. Where in Narendra Modi’s reality that definition places Mutharika’s 110 underlings is anybody’s guess.

Racism and Bigotry is encouraged from the top, but the real enemy is Global Inequality

The other day – about two weeks ago, the British Prime minister referred to the migrants at Calais trying to cross into the UK as ‘swarming..’ It was an insensitive term and many people rightly took offence. On twitter, many condemned such a wording as dehumanizing.

A few days ago, Philip Hammond, the British Foreign Secretary joined Mr Cameron, speaking of ‘marauding migrants‘ threatening the standard of life of British nationals in the UK. Again, Like Cameron, you have to wonder on which planet these people live on. Amnesty International called the language shameful. The Liberal Democrats Home Affairs spokesman Alistair Carmichael had this to say:

“The Tories’ language is becoming increasingly hostile and unsavoury. In reality, they are too scared to deal with the humanitarian crisis unfolding in Calais.

“Britain can’t escape the problem just by sounding ‘tough’, it needs to take a lead.

“It’s time we proved our worth on the world stage, signed up to the EU asylum policy and accept our share of vulnerable refugees, rather than expect other countries to do it for us.”

I think it is insensitive to describe other human beings in such animate and dehumanizing terms, and just goes to show how out of touch politicians really are. It also shows that humans from Africa, Asia and the Middle East are not valued in the same way British or European people are.

It’s a fallacy to see British leaders going around the world preaching democracy and peace, when right on their doorsteps, they are treating foreigners like crap. You can’t make that up, and you’d hope the world is watching.

Asylum Aid criticised the Foreign Secretary’s words as

“inaccurate and inflammatory statements”,

I agree, they present a skewed picture that divorces nuance for the situation. I’m waiting for the day a sensible British politician will rise up who will say to the people of the world that the actions of British leaders in the past have caused immense human pain, and damaged other lands far away from British shores. And some of that damage is still being felt today. I may not be alive when that happens, but I hope one day someone will be honest and brave enough call a spade a spade.

Knowing what I know about British History (both what you are taught in school, and what you find out for yourself), and having experienced first hand the institutional racism in the UK, I can tell you without a shadow of a doubt that in some sections of the UK population non-white people are treated differently to white people. There is extreme hostility against foreigners, which is not entirely surprising since the media fans hatred all the times. But it’s kind of strange seeing migrants contribute so much to the UK (not only via the NHS, but in the taxes they pay).

The government’s attitude towards immigration is so frustrating precisely because it is so wrong-headed. There is endless proof that the long-term benefit of migrants and asylum seekers are manifold – Ugandan refugees, for instance, have created approximately 30,000 jobs in the Leicester since 1972. Last year the Treasury’s independent advisers said that immigration is beneficial to the economy as new arrivals are most likely to be of working age – and even the chairman of the Office for Budget Responsibility, Robert Chote, stated that growing immigration to the UK “does tend to produce a more beneficial picture” for the economy. Read more here

So then why would a leader or a minister speak so negatively about migrants? Cameron and Hammond are hardly Nigel Farage, they can’t possibly be that ignorant not to see the repurcussions of their statements.

Isn’t such talk exactly the kind of talk which sows the seeds of racism, hatred and bigotry in society? Are these the kind of behaviours these leaders want to encourage in Britain? I think not, my guess is there is an agenda – some political capital is to be carved from all this.

To me this is how it looks: they are saying migrants, whose ancestors, Europeans took advantage of, looted their lands of every natural resource, enslaved their peoples, raped their women, made wars against them, divided up their lands along nothing but profit-driven motives, and generally reduced to poverty entire peoples – as they did in India and China; and whose descendants – the migrants – are now trying to find a way of escaping hardship, poverty, discrimination and violence in their own lands,  are not worthy of peace, of security, of assistance – seeing their past troubles, of prosperity. Essentially that they are subhuman, thats what the actions say.

https://soundcloud.com/rttv/calais-ryan

The Greatest Cover-Up in History ? How Imperial Britain’s Racist India, Africa & China Narrative ‎Still Persists

Actions speak louder than words, and what we are seeing here is an entitlement mentality. That it’s okay for historical European abuse of non-European peoples to be swept under the carpet; that the bombing of Libya, Iraq and support for Syrian rebels is irrelevant to the migrant crisis and must be brushed over, that if you plunder resources of other countries, and create economic and political instability…  its okay because if s**t happens, you can always close the borders. It’s the sort of things these people on this poster would say

criminals

During Nazi Germany’s reign, Hitler’s honchos put out propaganda which was later enacted upon to make life difficult for foreigners in Germany, in particular for Jews. What followed was a human atrocity that culminated in the holocaust, but which the Nazi machinery justified with all sorts of abominable stories. But there was a sinister motive behind the hostile rhetoric, and the Nazis made a lot of money out of it.

There’s always a sinister motive behind hostile rhetoric.

Today, the migrants at Calais are not being threatened by gas chambers or execution, but the language directed towards them – by politicians, not least the likes of the Daily Mail – is no better than that which was used by the Nazi machinery. Still, most of these migrants have no access to land or capital in the countries they flee; a polar opposite to Western corporations operating in Eritrea, Ethiopia, the various West African Countries, Syria and Iraq  – who have access to land and capital in those same countries.

The migrants have no security, and indeed may be at the mercy of criminal gangs and trafficking networks – something which expats in the aforementioned countries do not have to fear. The expats can get on with their easy and comfortable lives seamlessly, while the nationals of those countries – and their migrant brothers and sisters drowning in the mediterranean – struggle with day to day living, and can’t afford an existence, never mind a luxurious lifestyle.

Why do we keep on blaming the poor migrants whose poverty the West is partly responsible for? Countries where corruption, tax-evasion, profit-shifting and white-collar crime are responsible for the loss of over US$1tn in illicit financial outflows

ChristianAidDeath & Taxes – the true toll of tax-dodging

That is the real problem driving migrants to Europe – Inequality. Because if you have security, a good job, great educational and financial prospects and a social life – in your own country, why would you want to leave and risk your life for a pie in the sky?

British Red Cross managing director Norman McKinley recently said about the cuts to the money asylum seekers receive in the UK:

“These cruel cuts will plunge families into further poverty, making it agonisingly tough for parents to feed their children, and practically impossible to buy clothes and other essential items.”

What he forgot to mention is that many foreigners support family members back home. I know people who send as little as £20 every other month to a relative in Africa for one thing or another; to help someone pay for school, or for food, or to settle some bill. It’s not much, but it does the job, and helps people at the other end.

So then, if a government introduces policies that have the effect of creating economic hardship for an already deprived community/ section of the population, how will they be able to help their relatives abroad – who are in worse financial circumstances? It doesn’t make sense and if anything it’s counterproductive…

One final thing I should say is this. How many Swiss ‘migrants’ do you bump into everyday? Or how many ‘Norwegians’ or ‘Mauritians’ do you know or do you bump into on a regular basis?

Switzerland, Mauritius and Norway are rich countries, and their nationals live in their own countries because the countries have the capacity to create jobs and distribute wealth fairly amongst their people. When you look at Eritrea, Ethiopia, Somalia and most countries in West Africa and Sub-Saharan Africa, the story is rather different.

Further, European and American corporations are not paying bribes (in exchange for lax tax arrangements) in Norway or in Switzerland, or are they? At least you rarely hear of such corruption, unlike in the countries from whence migrants come.

If Western businessmen continue to fleece the countries from whom migrants originate,of valuable resources, how can European leaders realistically expect migrants to stay in their own countries? When the funds the country is losing is exactly the kind of money that would create jobs and an economy that can support that country’s citizens… Let’s be honest here… it’s not going to happen, and some of this rhetoric is a smokescreen to the real problems.

Mr Cameron, and Mr Hammond, if you are really serious about reducing immigration, begin by pushing for real global economic equality, at national level, within the EU, within Commonwealth, at UN level and beyond. That in my view has got a much higher chance of curbing migration to Europe than anything else.

What Young Malawian Entrepreneurs Need

Draft Template/ Working Document/ Collection of thoughts. Introducing the Youth Development Cooperative (YDC).

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Overview

unemployment-africa

Young people across Africa are hungry for success. From the technology clusters currently popping up in Kenya, to those in Ethiopia young Africans want to do well.

As a small landlocked country, Malawi is disadvantaged in many ways. But those geographical challenges also present the country with an opportunity. It means we must work smarter than our neighbours to not only survive, but to thrive. It means we must innovate.

Thus, there is hope in that the government can enact several laws, pass executive orders and generally assist in creating a climate which would improve the business environment for many young people, as long as they have a desire to succeed, and are willing to work hard for it. I hope Peter Mutharika’s government does this because such will in the long-term stimulate growth, employment, and contribute to poverty alleviation across Malawi and neighbouring countries.

The text below is a collection of thoughts, ideas and inspiration from multiple sources, and should be understood to be a working document, or template that can be improved, and not a perfect suggestion. Any critique is welcome.

Firstly a public body [Youth Development Cooperative (YDC)] would need to be created that has:-

  • An executive branch made up of seven salaried senior positions (Director, Company Secretary, a Commercial Director, a Business Development Adviser, a Human Resources Director and two Administrative assistants) each on a 3 year once-renewable contract. They will be appointed on merit based on their qualifications.
  • They will be the face of the organisation, and in charge of management and other functions as outlined below, including employment (each of the centres described below will need a Manager, a Business Adviser and five or six employees to work shifts in running the centres).
  • The YDC will have a Board of Governors made up of nine people (for example 3 from CSOs, 2 from clergy, 2 from the Business Community, and 2 diplomats from foreign embassies) who will serve an unsalaried maximum term of 3 years. While this may seem like a random and unusual collection of people, the thinking behind is to create a board that is resistant to ‘interference’, or as resistant as can possibly be, and that is truly interested in the development of the youth, as opposed to financial gains / allowances. From my experiences, and close observation of boards of parastatals in Malawi, patronage can disable / destroy an organisation which would otherwise thrive.
  • The Board of Governors will have the power to make appointments of the executive of the cooperative (by vetting & voting). They will be responsible for reviewing the individual performances of each of the members of the executive, and decide whether to renew their contracts or not.
  • The seven members of the board of Governors (excluding the diplomats) must be selected by a public vote (on a district majority basis) in which any Malawian aged 16 years and above can participate. No more than one candidate may be selected from each of the 28 districts of Malawi AND no more than 3 people can be selected from each region (South, Central, North).  The 2 posts offered to diplomats will rotate among foreign embassies who elect to take part, and they will be free to send a person they choose.

The importance of such an arrangement is to ensure that the organisation is truly independent, and not be politically aligned. In this case,  it is in the interests of all Malawians for young people from across the country to thrive irrespective of  political party affiliation, thus the board should be representative of the country.

The organisation will be created to tackle five primary areas in which the Malawi government can intervene in stimulating growth, and helping young people thrive.

1. Lower barriers to entry for Malawian Nationals

barriers2entry

The government must ensure that they lower barriers to entry for young people in Malawi:-

  • Information Technology – We live in the information age, and IT is critical to the growth of our country’s economy. So the government must establish Public IT Centres providing free internet (satellite or other reliable service with minimal outages) and hot-desking facilities to support any Malawian under the age of 35 who wants to start a business. It should be a place where young people can receive free advice and teaching on web technologies and other subjects. It should be a place where young people can go and exchange ideas, a place to read national and international newspapers, and get exposure about what is happening across the business world across Africa and internationally. This will help in inspiring young people of promise about where the opportunities are, and how to take advantage of such opportunities locally. It will also be a place where they can learn how to code and write software, including networking with other like-minded folk. Each YDC centre must be equipped with 2 or 3 classrooms, 3 meeting rooms, an IT room with at least 30 desktop computers in it, printing facilities (a paid service), a canteen (to sell drinks and snacks), a common room stocked with everyday newspapers in English from Malawi and from across the world, a news room with 3 or 4 TV sets showing different channels, a storage basement, and toilets.
  • Following a successful pilot run in 3 centres, (Blantyre, Lilongwe and Mzuzu), if 7 additional centres can be created across the country (one in each of the following towns/ cities: Chikwawa, Zomba, Mchinji, Salima, Kasungu, Nkhotakota, and Karonga) to begin with, that would be a promising start.
  • Such centres would create direct employment, initially for around 77 people, and could later be expanded to include specialist science and business libraries (to encourage reading and for dissemination of information, and to teach modern technologies).
  • They could be used as bases for visiting foreign health specialists to hold community clinics. Additionally, the classrooms can be let out to Aid Agencies (for a fee) for community work or rented out to others needing space to hold meetings.
  • Software will be installed to block social networks, and ensure the facilities are used for educational / business purposes, and critical bandwidth is not wasted on downloading entertainment videos. Wi-Fi would be provided for free for those with laptops / smart phones, although depending on bandwidth, computer time will be capped to only 6 hours per person each day to give access to moree people.
  • In order for each centre to be functional, it must run on both the energy grid, and eco-friendly energy like solar panels, and have backups in the form of diesel generators, so that services should be up and running even when ESCOM  power supply is down.
  • Business Support – Many young people in Malawi feel powerless and disillusioned. They leave school only to find there are no part-time jobs for them to do, nothing to help them in their quest to get independent and be part of the economy. Most live at home years after graduation, doing nothing. They end up wasting time, in gangs, mixing with the wrong crowds, committing crimes, drinking their lives away, or being an expense and source of shame and worry to their parents and neighbourhoods.

This vicious circle is unsustainable for a country in which ~45% of the population is less than 16 years old.

What is needed is a pipeline where those young people aged between 16 and 35 years, who are interested in entrepreneurship and business, can be tutored, guided, mentored, directed, and empowered. For those still in school or undertaking exams, YDC centres can contract local teachers to provide tuition for students who need more help with their studies, benefitting both teachers and students.

For those who want to start a business, gain additional knowledge to improve their lives, the YDC centres could offer classes and guidance on

  • (i) Venture Capital
  • (ii) Business & Revenue Management including book-keeping and such daily tasks
  • (iii) Advertising
  • (iv) Saving
  • (v) Taxation
  • (vi) Legal compliance
  • (vii) Managing Debt, and
  • (viii) Customer Service.

Using the YDC centres around the country, such type of instruction can be provided to young people to enable them to be entrepreneurial and support them in being productive citizens. This will also create employment, and Public Private Partnerships could be utilised to communicate such knowledge.

Capital23

  • Business Loans / Venture CapitalThis seems to be the biggest challenge/ barrier to entry for young people in Malawi. Most are willing to learn, to venture out and have a shot at a business, but many have no source of capital.

A system should be created where low-interest loans (not more than 10%) as low as $500 to upwards of $5000 are extended to young people with promise, without the stringent collateral of land /property required by banks ( most young people don’t own property or land…). In order to safeguard against abuse, eligibility should be tied to an examined course spread over 3 – 4 months designed to test certain competencies–with classes which every applicant must attend, and an exam which they must pass to be eligible. A criteria should be formulated which ascertains the merits of each business proposal. And once an applicant is successful, the funds must be disbursed in phases, and primarily be used for:-

  • procurement of goods or resources for use or for sale by the new business, including for example buying a service online
  • for logistical support, such as ordering goods abroad.
  • for payment of business costs such as company registration, marketing, or transportation
  • to pay for educational courses, or web design, web hosting and such like.
  • for minor expenses not exceeding $50 each.
  • possibly for start-up wages to employees (strictly from month 1 to month 3 only) depending on the monthly turnover.
  • And to pay for specialist expenses (for example a young man who wants to start a butchery, or a takeaway restaurant will need to rent out a building. Their needs and requirements will be different to those of a person running a removals / commercial cleaning business, which will be different to someone who wants to establish a call-centre/ video game development company.

Funds must not be used to pay salaries beyond month 3, nor be used for food, or paid directly to an applicant’s personal account.

Each Centre Manager and his Business Adviser together with the Secretary and the YDC’s Commercial Director (both of whom would roam across the centres as required) must review each request, and properly consider whether such would be the best use of funds for that business.

  • Finally, any assets, property or land acquired by an entrepreneur using funds from the YDC will remain the property of the YDC until after each loan is repaid in full. At that point 70% of the equity stake in the new business will pass to the entrepreneur, whereas 30% will remain with the YDC. This is important for liquidity, although in the event that a funded business turns out to be a great commercial success, the entrepreneur can buy out the YDC on payment of an agreed fixed sum.

A business will be able to begin its operations as soon as it has procured its requirements, thereby allowing use of the acquired assets to service the loans it owes to the YDC. One of the duties of the centre manager and his business advisor will be to monitor the progress of each business registered to his centre, and give advice as appropriate.

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  • Affordable office SpaceThis is also a challenge. However, with the above centres, the hot-desking facility could create casual shared office space for 40 – 50 people at each location. Collectively that’s giving an opportunity to 500 or so young people the ability do something positive with their lives. And should 0.6% of those people (3 people) create ventures with an annual turnover greater than $500,000, the potential of such centres would begin to look significant.
  • Users of the centre’s hot-desking facility would need to book use of the rooms by text or phone beforehand, however the other aspects like the computer room and news rooms will be on a first come first served basis.
  • Affordable Warehousing Space

warehouse1So, you’ve taught them how to run a business, and provided resources such as a business address for them to receive post from, to enable them to seek opportunities. What you also need to do especially for those businesses who will be importing raw materials, equipment or products from abroad,  is provide a secure warehouse space, whereby a person can hire a locker, space on a shared shelf, or a small room, to store and stock their wares and goods at low prices. This way we are reducing the cost of doing business, and removing another barrier.

2. Lower Logistical costs

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a truck with a trailer

It is also important to lower logistical costs for new businesses because this is one of the barriers stopping our economies from moving forward. On this note, more resources should be invested in better roads, and in particular in ensuring that the Nsanje Zambezi inland Port is cleared by the Mozambican Government, so that it opens for business.

In the interim, the cost of importing goods and equipment must be reduced by:-

  • The YDC hiring a 40 foot container, for imports from Europe, (departing from a port in the UK), another 40 foot container for imports arriving from the US and a third 40 foot container for imports from Dubai and Asia (including China), to operate once every two months. The shipping fees must be preferential to Malawians, and at least 35% cheaper than those charged by other shipping operators. This means a number of things.

(i) Malawians in the diaspora can use such a service as a way of giving back to Malawi to send their goods back home instead of using foreign services that do not benefit Malawi.

(ii) Thus, it means additional Forex for Malawi, money which can be used to expand the scheme or donate to worthy causes such as building new schools or hospitals.

(iii) It also means some aid organisations and charities in Malawi could be persuaded to use the YDC’s shipping service, and not any of the others foreign ones.

(iv) Businesses in Malawi, including those under the YDC will have a cheaper and reliable way of getting goods to Malawi.

(v) The YDC will have a revenue stream which it can rely on to pay its employees and finance the expansion, development and operation of its centres.

  • Similarly the YDC could invest in at least 4 heavy goods Trucks (to get the containers from ports in Tanzania or Angola to Malawi), 2 Buses, 3 minibuses, 10 estate vehicles, and 10 vans, as capital assets, and to assist in the functions of the centres. All these assets will be sources of revenue, and contribute in lowering the cost of doing businesses for businesses operating from within YDC premises. To keep costs low, such capital assets can be purchased second-hand at reasonable prices.

3. Civic Education

Image from UNESCO
Image from UNESCO

An educated population is an empowered population. So Civic and adult Education is very important not least because when parents are educated, they will emphasize the value of education to their children. Thus, it would be in the best interest of the Malawi government for such to be provided to help increase literacy levels and educate the rural populations. Thus the YDC centres can be used as a way of crowdsourcing resources. So for example, a group of farmers could be assisted by the YDC to procure a tractor for their local cooperative. The YDC could act as a middle institution to identify the need, facilitate the procurement and assist in maintenance or upkeep.

This initiative may also be a way of safeguarding against corruption and attracting investment from donors in that funds are provided to a whole bloc of people with a common purpose instead of being given to individuals.

4. Export Advice

Malawi is a small market and for our businesses to truly grow and survive, we need resources from far and wide. This will also mean selling as many of our products abroad, and making a profit in the process. It means that for our entrepreneurs to create sustainable ventures, they will need to be competitive on the global market.

  • Thus, the education our entrepreneurs receive must be comparable to global standards,
  • Businesses must be encouraged to have a cross-border strategy following proven principles.
  • The YDC can help small businesses to export to our immediate neighbours and even internationally.
  • Export Experts would need to be contracted  to run seminars to teach businesses  about exporting, and why exporting for a small economy is crucial.

5. Tax Breaks

Why should young people in Malawi – who have more obstacles – not get tax breaks when foreign corporations are allowed to do so? For the first 18 months of each new business / company that is incubated within a YDC centre, tax breaks must apply so long as its revenues do not exceed $20,000 a month, and so long as it’s not a subsidiary of a larger company. Tax breaks can help create a breathing space for a new business to be established, before the state’s demand of tax becomes a factor to be considered. In any case, employees will still be paying income tax, so the country will not be losing out significantly. Audits will be required to prevent abuse.

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