Investor roadshows should be based on absolute truths

FINANCE minister Mthuli Ncube’s global investment roadshows fit into my long held belief that the most dangerous person for a country is not the incompetent, it is the person who is completely and totally convinced that wrong is right.

It is also completely true that as nation we can survive our fools (as said by Marcus Tillius Cicero 106 to 43 BC) but we cannot survive an educated man who has corrupted his professional beliefs to do things he doesn’t believe or can’t be reasonably be expected to believe.

It is even possible for the minister to believe he is coming with a bag full of deals.

An incompetent person is someone lacking the ability to complete a certain task or lacking the capability to effectively execute.

The latter has the ability and capability to fully execute, and will do so with extreme prejudice. They are typically highly intelligent and yet so wrong. Illusory superiority fuels every action. Over the years, I have taken to calling these people DKs, which is a short for victim of the Dunning-Kruger effect.

That just seems to work on so many levels. I am a globalist and having worked for two large corporations in company secretarial, legal and corporate affairs my understanding is global capital can even move into countries with sordid policies but not one which is based on lies and or inconsistency.

If you have no democracy and a good human rights record, don’t pretend. I wonder what reforms the minister is talking about and what they mean to anyone with capacity to read and write because no one sees them. I know global capital faces a lot of attention and is highly volatile because in my old global position we would shift capital within and outside the region at very short notice.

Global forays require simultaneous and sequential stakeholders soothsay. Our failure on that is our greatest undoing. We are building our forays on lies even to the person making the pitch. Believing a lie in a Joseph Goebels format is a dangerous public policy.

Brand Zimbabwe is extremely damaged, puerile, and pungent and is a hard sale. It defies logic to undertake such forays when back home the stakeholder machine is grappling with three new issues, that is, constitutional amendments, Patriotic Bill, the national youth service and multiple arrests of activists.

It does not matter whether government is right or wrong, Parliament and Judiciary action on the current issues, it’s perception that matters. What matters to the international investor community is their perceptions and advisory notes from those on their payroll.

Inasmuch as human rights and democracy is not exactly a major consideration for investment decisions, it is our inability and or failure for pre-emptive information provision, being on the offensive, incapacity to defend, often a rogue public relations response to world queries and arrogancy on world matters. It is impossible for investors to believe the minister’s word that his forays are based on reform.

It is of no meaning and value in the investors corridors when before and after the meeting the same investors are bombarded with negative sentiments from his home. Ncube should have either convinced his principals to shelve the multiple changes and place the stakeholder relations machine on overdrive.

It is wrong timing to undertake engagement with capital at a when he cannot provide a solid answer for the turmoil caused by constitutional amendments, a controversial Patriotic Bill, arrests, civil service job action, and other unsettling country developments.

As an example, an investor would be at ease if he knows or at least believes the judicial processes seem fair in case there is a commercial dispute. It is tough when an amendment may mean a new breed of judges.

We can’t conceive anything more destructive to morality when a respected academic starts a roadshow with the perjury that there has been a successful currency reform. It’s not even possible for anyone to believe that. No one believes and or trusts the central bank with currency management.

In the medium term, his currency reform should ideally be anchored on either an independently appointed monetary authority and at best a privatised central bank, or the currency part of it, like the likes of South Africa and United States of America.

For now, no one will bite the Zimbabwe dollar hook. The currency policy is so inconsistent, it’s impossible to make any investment decisions.

In addition to currency reform, it is further being economic with the truth that our multi-currency system is anchored on the foreign currency auction system. The reality is that most of the traders are simply using the auction system for arbitrage. Obtaining United States dollars at about $86 but players are buying it from selling their currency at $120.

The forex auction system is subsidising companies and providing opportunities for arbitrage profits such that it is doubtful for any clever investor to believe in a roadshow anchored on the lies of freely trading currency. It fact the large beneficiaries of currency allocation may be businesspeople whose major profits are derived from foreign currency trade.

It is not a hard call to fully free the currency trading system.

We have to be pro-business, free market, Austrian school of economics kind of people and we must defend businesses, corporations and in some cases, monopolies — if the monopolies created value for their customers and played fairly. If we don’t wake up to that reality, we will realise that the “Zimbabwe is open for business” mantra mainly benefits the closely knit and controlled enterprises.

Often it’s murky to understand, as example, how company A from country C was allowed to mine some mineral without open, transparent and equal availability of the same opportunity to the world.

In a roadshow, it’s folly to sell a Zimbabwe in which we can convince them that a legit business “A” in Zimbabwe will be judged for competence as compared to business “B” in public procurement processes because the general belief is that it’s not true.

It’s irrationality also to drive a point that a company from country “X” has equal opportunities with a company from country “B” because it is widely believed some companies in networked countries get preference.

Our public soothsay is dead on that aspect.

It is actually possible that Zimbabwe provides a fair and equitable environment for every business, but as Zimbabweans we don’t generally believe so. The world certainly believes that we have a warped tender system, unequal opportunities to business and a very asymmetric business information system.

The public relations machine is not speaking to success but to damage control, to arrogantly show credentials and rarely concentrate on substance.