IDC TO RESTRUCTURE LEGACY DEBT FOR STATE ENTERPRISES
STRATEGIES to boost financial performance for entities under the Industrial Development Corporation (IDC) such as restructuring the legacy debts are being worked on.
This announcement was made by the IDC Chief Executive Officer, Mr Cornwell Muleya, who reiterated that most of its entities were making losses due to the huge legacy debts they had been carrying.
Mr Muleya expressed confidence that it was possible that these entities could begin to perform better in the future by restructuring the legacy debts and aligned to their income generation capacities.
“Most of the losses posted by our subsidiaries are not cash losses but structural losses. These losses are caused by the huge legacy debts the entities are carrying because they borrowed in dollars,” he said when he appeared at the ZNBC Sunday Interview.
Mr Muleya noted that the entities ended up incurring the huge debts with the Kwacha having been expanding across the period.
He also said IDC was looking to address issues surrounding business structures, management and personnel strengthening to make State-Owned Enterprises (SoEs) more profitable.
Mr Muleya said the corporation had since been asking the boards of the entities to come up with focused programmes that targeted the issues their enterprises were grappling with.
“With such focused programmes we believe they will be the beginning of great success and tremendous financial performance,” he said.
Mr Muleya also said that IDC had put in place a framework for ensuring that there was a balance at board level by selecting board members based on professional specialisation, business and international experience.
This framework, he explained, was free of political interference and ensured a board focused on the entities’ objectives was put in place.
“IDC advertises a call for competent members of the public who would like to serve on the boards of its entities, through this process board members are selected on merit and competence,” Mr Muleya said.