Several radio stations and social media have been swamped with different views on the banning of potato importation by the government. Many have supported the idea while others have opposed it, and they have all provided their reasons for thinking like that.
Economists and proponents of the free market economy have described this decision as ‘stone age’ and retrogressive. Let me declare that I am a supporter of free market economy with some ‘massaging’ to the theory. I believe that there is no absolute free market economy in the world; not even the USA. There are always certain restrictions that are put in place to support their industries. Not long ago we heard of trade wars between China and USA over the electronic industry. USA and China are the top two largest economies in the world with well integrated industries but they were both protecting their companies. It is not a secret that USA’s iPhone market felt threatened by the growing market for Huawei with its robust marketing.
The permanent secretary in the Ministry of Agriculture has issued a ban on the importation of table potatoes. What is not clear though is whether this includes products from primary processed potatoes such as chips. It is not a secret that the largest market for potatoes in this country are fast foods and restaurants. They consume over seventy per cent of the potatoes sold in the country. If the ban on potatoes does not include chips then there is no need to even effect it. The fast food industry imports the crated potatoes from South Africa. The implications for our economy is that we are losing so much forex to South Africa as well as creating jobs for the farmers from that country. Many have argued that the government should have invited investors to invest into factories making chips. This has been tried several times and they also know that by doing such, they will be moving jobs from RSA to Zambia. People seem to have forgotten what happened to companies like Price Blitz, some furniture companies and many other trading companies that established operations in Zambia. They took advantage of the loopholes in the policies by operating for five years and enjoy the tax holiday. Immediately they had clogged five years, they fold up and sell the business to a sister company from that country which also comes to enjoy another five years and so on. From the many companies from RSA, the only one that has consistently operated as it was from the time it started its operations in 1995 has been Shoprite.
However, this ban if wholly applied will come with its own demerits. In the next two to three seasons, we might see some shortages of potatoes as well as increases in prices. This is expected but I guess this is the opportunity that the Zambian farmer needs to jump on. Additionally, the banks or the government should encourage businesses to quickly establish a plant to be making chips to supply such restaurants and fast foods that are currently buying chips from South Africa. I am sure Buya Bamba will extend its outgrower schemes to farmers such as those that are growing potatoes in Serenje and new ones in Mkushi. Zambia Revenue Authority should also come on board and ensure that no potatoes and chips are allowed to cross the borders. For those that are destined for Congo, they should put strict systems to monitor the trucks so that they exit from Kasumbalesa and those that do not show acquittal forms from that end should not be allowed exit from Zambia. What I know is that a lot of people will make money through corruption by allowing trucks entry as well as smuggling the product. Don’t apply the uubomba mwibala alya mwibala syndrome here. The ban can be lifted after our industries have gotten established in the potato sub sector. I hope this is not just a campaign gimmick because we are very good at acting in Zambia; very unpatriotic people.
The next industry they should target is the cotton or cloth industry. We can’t be trading in second hand clothes when countries like Rwanda have banned such trade. These second hand clothes don’t just depress the development of the cotton sector but they also brought so much suffering in terms of diseases. The second hand trade has killed the cotton industry in our country. We need to help this industry as it has so much potential; we have seen it prosper in the past. We seem not to have picked any lessons from the wheat and soybean subsectors. This country does not allow importation of wheat and soybean; neither do we allow export of unprocessed wheat of soybean.
These two crops have created so many jobs through value additions. Just look at the number of oil expelling plants that have been established since the ban of the export of soybean. It has led to the expansion of the crushing capacity and many farmers including small scale farmers have jumped on the opportunity and are growing a crop which used to be a preserve of commercial farmers. People, we have $24billion debt to pay. Check for similar articles on our facebook page called, The Agribusiness Focus (#ft2014af) follow and like it.
The author is the Agribusiness Development Consultant; firstname.lastname@example.org