Our first lesson is that; leadership integrity and accountability were at the centre of the success of Rhodesia's import substitution project. The unfolding revelations of the rot in our state enterprises are shocking, and reflect the value system of our current leadership. Unless we brutally address this, any of our contemplated economic recovery blue prints are a waste of time.
Second, he ensured that no raw material left the country as a matter of policy. Vertical integration of industry was primary at all costs. If no raw materials were to leave the country, it required that the country had to develop the capacity to process them first. This was achieved by investing heavily in infrastructure, especially in the railway network, power and water. Our lesson here is that we need an informed and holistic strategy on vertical integration of industry that is not implemented ad hoc, but takes into account what needs to be in place first. In many instances, this government announces good projects without first ensuring that we have the capacity to implement them. It also does not do enough home work to make sure that implementation does not create negative unintended consequences that derail or immunise the intended results. We need to think clearly and anticipate before we act. Inconsistent government policy clouded by hidden vested interests remains our core problem. The third thing that Smith did was to implement selective subsidies, but these were price subsidies and not input subsidies. In other words, the finished product would be subsidised through its sell price only. This avoided a parallel market for inputs developing. It also avoided profiteering at input level as is the case now, where chefs buy fertiliser in bulk to make profits thereby creating artificial shortages and increasing production costs unnecessarily. An example was the subsidising of wheat production. Farmers would produce wheat without input subsidies but the price of wheat offered, would compensate the farmer for his full cost of production thus making it viable to produce wheat. Fourth, Rhodesia had very strict import control measures with strong accountability and fairness. Companies had to have import licences which were managed fairly and with minimum corruption. They had to first prove that they could not source inputs locally and this further encouraged local supply companies to grow. The middleman had no place in that process. The important thing here was that this policy was only guided by the national priority of producing goods locally. Government officials did not drive imported German or British cars as is the case now. They used locally assembled Peugeot 504's if you remember, thus creating local demand and jobs. full: http://nehandaradio.com/2014/02/13/five-lessons-rhodesia/ -- Wobbly times http://wobblytimes.blogspot.com.au/ _______________________________________________ pen-l mailing list [email protected] https://lists.csuchico.edu/mailman/listinfo/pen-l
