Biti slams privatisation phobia

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Biti slams privatisation phobia
Thursday, 28 October 2010 19:07

FINANCE minister Tendai Biti has criticised a "phobia" within the coalition
government for stalling a proposed plan to list three parastatals on the
Zimbabwe Stock Exchange (ZSE).
Biti's remarks come eight months after he told market watchers during a
reverse listing of Tedco Ltd (now TNFH Ltd) that government would
recapitalise three state-owned enterprises by going public.
Although Biti did not name the parastatals, speculation was rife that mobile
phone operators NetOne, currently struggling to claw back market share since
the dollarisation of the economy last February, was one of the targeted
state firms.
This development extends the listing drought on the capital-starved exchange
that has to date seen only two reverse listings — Tedco and CFX (now
Interfin).
Biti was responding to a question from the parliamentary committee on budget
chairman Paddy Zhanda during the presentation of oral evidence to the
committee.
Zhanda, Goromonzi North MP, asked Biti why government was reluctant to wean
off perennial loss-making state companies.
The lawmaker cited the public listing of Cottco and Dairibord, formerly
state-owned entities, which became profitable after listing on the ZSE.
Among some of the state-owned companies in the red are Zesa, NRZ, GMB, Air
Zimbabwe, CSC and Agribank.
"Zhanda said: I don't think there is anything that you can salvage from Cold
Storage Company. When is the right time to privatise? I think it's not fair
to tax people earning as low as $180 to buy Mercedes Benz vehicles for
executives of struggling parastatals."
In his response, Biti said his counterparts in the inclusive government were
cautious to list or privatise parastatals despite enormous pressure being
piled by state enterprises on the fiscus.
Government is generating nearly US$140 million in revenue monthly and this
figure could increase when key utilities contribute a projected 40% to the
Gross Domestic Product.
"There is phobia in government of the word privatisation," Biti said. "I
personally hoped that there would be three listings on the ZSE of formerly
100% state-owned entities. It hasn't happened. We are in October and trust
me, it is not going to happen before the end of the year. I think it's a
tragedy as some of us have argued (that) I would rather own 10% of an
elephant than 100% of a rat."
In June, former Parastatals and State Enterprises minister Joel Gabuzza said
government was expected to privatise 11 state-owned enterprises. He said
"discussions were underway" to wean off Cold Storage Company, Grain
Marketing Board, Agribank, Ziscosteel, National Oil Company of Zimbabwe,
Allied Timbers, Air Zimbabwe, NetOne, TelOne, Infrastructure Development
Bank of Zimbabwe and ZIPAM. But to date discord within government has failed
to attract potential suitors of the state enterprises.

Bernard Mpofu