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Economic empowerment beyond access to finance.


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Economic empowerment beyond access to finance.

  2. 2. Historical Background Cont’d• In 2005 a Citizens Economic EmpowermentAdvisory Committee comprising public andprivate stakeholders was appointed .• Tasked with the responsibility of developing acomprehensive empowerment policy that wouldensure equity and empowerment of Zambiancitizens as they engage in sustainable economicactivities.4
  3. 3. Historical Background Cont’dThe Citizens Economic Empowerment AdvisoryCommittee, in developing a comprehensiveempowerment policy, took into account:• The achievements and failures of past policiesaimed at empowering citizens• Lessons learnt from these past experiences• Lessons learnt from other countries who haveengaged in a similar programs.5
  4. 4. Citizens Economic Empowerment Act• In 2006 the Citizens Economic Empowerment (CEE) ActNo.9 was passed.Objectives of the CEE Act• Establishment of the Citizens Economic EmpowermentCommission (CEEC)• Establishment of the Citizens Economic EmpowermentFund (CEEF)• Promoting the empowerment of targeted citizens• Promoting investment through fostering joint local andforeign ownership of companies6
  5. 5. What is Citizens Economic Empowerment?• An integrated broad based and multifaceted strategyaimed at substantially increasing the meaningfulparticipation of targeted citizens and companies inthe economy and decrease income inequalities.• Citizens Empowerment goes beyond participation ofcitizens; in addition to participation it includespsychological sense of ownership and actual controlof economic power.• Empowerment is a process and we have to continuebuilding on it.
  6. 6. Description of targeted CitizensWho is a targeted citizen?• “A person who is historically marginalised ordisadvantaged and whose access to economicresources and developmental capabilities have beenconstrained due to various factors including race,sex, educational background, status and disability”Who is eligible to access empowerment?Broad based economic empowerment,means economic empowerment of:• Targeted citizens• Citizens influenced companies• Citizens empowered companies• Citizens owned companies7
  7. 7. FUNCTIONS OF CEEC• To coordinate and implement empowermentprogrammes for targeted citizens.• To substantially increase the meaningful participationof targeted citizens and companies in the economy inorder to decrease income inequalities.• Ensure economic empowerment of targeted citizens;citizens influenced companies, citizens empoweredcompanies and citizens owned companies.
  8. 8. PILLARS OF EMPOWERMENT1. Equity/Ownership, Management and ControlCitizen Influenced (5 – 25%, CitizenEmpowered (25-50%), Citizen Owned(50%+1)2. Preferential ProcurementAt least 50% of Government and PrivateSector expenditure [over the next five (5)years] should go to empowered companiesand that at least 30% of these suppliercompanies be controlled by targetedcitizens3. Skills DevelopmentImprove education and enhance ability toadopt modern business practice8
  9. 9. PILLARS OF EMPOWERMENTContinued4. Access to FinanceEstablish the Citizens EconomicEmpowerment Fund, a special purposevehicle to finance CEE.5. Transformation of SocietyTo provide supportiveculture, entrepreneurship for sustainableCEE6. Corporate and Social ResponsibilityEncourage companies and communities topartner and uplift communities9
  10. 10. PILLARS OF EMPOWERMENTContinued7. Good Political and Corporate GovernanceCreation of predictable legislation andregulatory framework for transparency andaccountability8. Greenfield InvestmentsPromote investments and partnershipsbetween local and foreign investors9. Foreign Direct InvestmentEncourage a foreign and local partnershipapproach to achieving CEE10
  11. 11. POLICY INSTRUMENTS. Land Ownership30% to be controlled by targeted Citizens by 2017;Leverage citizens’ participation in joint-ventures2. Empowering Disadvantaged GroupsYouths, Women, disabled and Citizens living withHIV/AIDS increased participation in economicactivities and opportunities without discrimination11
  12. 12. POLICY INSTRUMENTS Continued... SustainabilityThe need for the broader economy tomeet the needs of enterprise andcitizens in a sustainable manner4. Lock in MechanismThe need to develop a strategy to lock-in investment funds for a reasonableperiod to ensure growth andsustainability12
  13. 13. POLICY INSTRUMENTS Continued..Rural Economic Development– Encourage collective enterprises as a way offacilitating ownership of assets by rural communities– Introduce incentives to attract firms to operate inremote areas– Introduce specific and targeted programmes for ruralareas6. Supportive Culture– Need for CEE companies to have champions fromtop to bottom as path finders for CEE– Quick payment to suppliers on the part of Govt.particularly SMEs– Need for a mind-set change13
  14. 14. POLICY INSTRUMENTS Continued..7.Regulatory and Institutional Framework–Alignment of other Acts with CEE Act–CEEC collaboration with otherorganisations8. Financing– Establishment of the EmpowermentFund14
  15. 15. The Role of CEEC - General• Partnerships with Private Sector, Civilsociety and all other Stakeholders• Measurement and monitoring of CEEPerformance• Harmonization and review of variousLegislation• Promotion of savings and repaymentculture15
  16. 16. Empowerment Fund• One of the key pillars that has been identified ascrucial to achieving economic empowerment is pillarthat addresses issues of access to finance.• The CEE Fund is established under Section 29 of theCEEC Act. The primary purpose of the fund is tosupport broad based economic empowermentprogrammes.
  17. 17. Product Development• The CEEC will continue developing products thatmeet different segments of citizens e.g ChilimbaMarket product and Working Capital finance product.• Some of the products that have been developedinclude;- Creation of value chain and market linkages strategies in agri – business in ruralareas, e.g Cashew Nut project in Western Province and Luwaka in North- Western.- Dairy farming product- Rural Service stations- Chilimba market product- Graduate Empowerment Programme *