Business

Take over State-owned enterprises, IDC advised

PRESIDENT Lungu, flanked by First Lady Esther (right), addresses Parliament in Lusaka yesterday.PICTURE: MACKSON WASAMUNU.

TRYNESS MBALE, Lusaka
THE Association for Building and Civil Engineering Contractors (ABCEC) has called on the Industrial Development Corporation (IDC) to use its mandate to take over state-owned enterprises (SoEs), especially construction firms, to build their technical and financial capacities.
Recently, Government announced the transfer of shares of 29 out of 33 SoEs from the Minister of Finance to IDC.
ABCEC president Michael Nyirenda said the acquisition of commercial interest in construction companies will create competition in the sector and companies will be able to participate in any tender process.
Mr Nyirenda said in an interview recently that this mode is anticipated to also localise as much financial resources as possible in the construction value chain even through sub-contracting.
“We are advising IDC to seize the opportunity that arises out of its mandate to oversee the SoEs by ensuring a contractor development plan as opposed to considering setting a completely new entity as the case was in the past.
“The country can greatly benefit if the IDC acquires commercial interest in 10 or more existing construction companies and build both technical and financial capacity,” he said.
He said acquisition of financial interest in existing construction firms will address the missed opportunities, particularly in the recent past, to grow the construction value chain.
The missed opportunities vary. They include sustainable employment creation and creation of formidable construction companies which will be a boost in national coffers through ripple effects of growth in the construction value chain and an opportunity to reduce capital outflow.
Mr Nyirenda, however, said Government should carefully get engaged in the construction sector as it takes over the SoEs because it has the potential to significantly contribute to economic growth.
The construction sector is a barometer for economic activity of a country, and industrialisation cannot occur without supporting infrastructure.

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