Saturday, January 29, 2011

Accounting for Africa's assets

part 1

Most of Zambia’s economy is supported by vast copper deposits in the Copperbelt area, although the recent collapse in commodity prices has damaged the country’s mining industry. Zambia is looking to other sectors to fill the void. Agriculture continues to be a significant employer of the country's workforce, and the Government is keen to promote the private sector, but it is the undeveloped tourism industry that offers most opportunity. Game reserves, national parks and Zambia’s greatest asset, Victoria Falls, which it shares with Zimbabwe, are elevating Zambia to a 'must-see' destination among tourists.
Margaret Mwanakatwe and Anna Chifungula are two accomplished Zambian ACCA accountants who have risen through the ranks in Zambia's private and public sector. In the first of a two-part series, Margaret Mwanakatwe tells Colette Steckel about her successful career in accounting and business.
As managing director of Barclays Zambia, Margaret Mwanakatwe FCCA is one of the few Zambian women to head up a business in the country's private sector. She explains how she achieved this and considers what challenges lie ahead.
Hanging on the wall of Margaret Mwanakatwe’s office at Barclays Bank in Lusaka are two framed photographs; one is of a tiny, ramshackle mud hut and the other is of a large group of school children crammed into a classroom. They remind Margaret of one of the things that she has been able to achieve as managing director of Barclays Zambia.
Each year, 1% of the bank’s profit before tax is set aside for community projects in Africa, which works out at around ZMK2bn. Of that money, 70% goes towards a central pot administered by Barclays Africa for programmes in education, HIV/AIDS awareness, and the disabled throughout the African continent. Margaret keeps aside the remaining 30% to donate to local projects at her discretion.
Which are where the photos come in. “This is a project that is particularly dear to me,” she begins. “That tiny building was a rural school in Mupita, in the north of Zambia. And all those children used to walk seven kilometres a day to attend lessons there. That’s how bad it was.” Through Margaret’s funding, the 240 primary schoolchildren now have a new school and three classrooms with a further three to go. Margaret is thrilled with the success of the project. “I visited the school recently and it’s so great to see the children sitting at a desk. And because I built the school, the Government has provided teachers, so the whole project has worked well.”
In a country burdened by vast national debt, and with 80% of the population on the poverty line, Margaret counts herself lucky that she has access to money to give back to the community and, in some small part, make a difference to a few lives. “We’re serious about community work at Barclays Zambia and we get inundated with so many proposals to support various projects that we can’t cope with them all. What we really need is for the private sector to develop so a lot more of us can help the community,” she says.
That won’t be easy. Zambia’s plans to grow the private sector have been gathering pace over the past few years since former President Chiluba introduced a privatisation programme, selling state-owned enterprises. His successor, President Levy Mwanawasa has continued the programme. But the economy continues to slide. In 2002, GDP was just 3% while inflation reached an unhealthy 20%. Most of the country’s economic woes are down to the collapse in commodity prices which have damaged the country’s once thriving copper producing industry, stemmed much of the government’s revenues and threatened to undermine confidence in the economy.
Margaret notes that the difficulties facing the economy are hindering private businesses. “High inflationary periods invariably mean high interest rates and high interest rates mean that local businesses have to be making damn good margins for them to be able to borrow money and pay it back. That restricts private sector development in a very significant way.” It also, of course, affects the banking industry’s profits, but Margaret fights back at some of the criticisms that commercial banks are lacklustre in offering credit to businesses. “I try to lend as much as I can to businesses in Zambia. And it’s often a challenge for me to manage my provisioning levels, because they are very high right now. But, ultimately, banks are all here to make money and I charge what I think is competitive and fair.”
International experience
Margaret’s interest in a career in finance began at the University of Zambia, Lusaka, where she was enrolled in the medical school at the encouragement of her parents. Two terms in, she put paid to the life of a doctor and started studying a business administration course, which she says she never regretted. On graduating, she packed her bags and moved to the UK where she stayed for several years, during which time she met and married her husband, raised a family of three, qualified as an ACCA member and worked as a financial analyst for leading British companies, including the brewers Whitbread.
An opportunity for her husband, a satellite communications engineer, to head up the English-speaking Africa division of a French company uprooted the family to Paris and introduced Margaret to the delights of teaching French students the intricacies of finance and accounting. “One of the most memorable points in my career was trying to teach those students about financial management. I think at one point I had to resort to acting, because I couldn’t get the message across in English. We had a few laughs together over that. I’ll never forget it.”
By the beginning of the 1990s, Margaret and her husband, also a Zambian, decided it was about time to return home. “Zambia was exciting at the time. There was no longer a one-party state. We had a new government ushered into power in 1991 (under former President Chiluba), and liberalisation was taking effect. It seemed to us that there was a move towards a more private sector-led economy. We thought it was time to go back and contribute to the development of the economy.”
Within weeks of returning to Zambia, Margaret got back on track with her finance career, joining a manufacturing firm as a finance manager and later taking on a general manager role. She then moved on to head up the investor relations department of the Investment Promotions Agency (now the Zambia Investment Centre), a government agency charged with promoting Zambia and facilitating private sector development.
She became managing director of Barclays Zambia in 2000 after a stint as a
non-executive director, becoming the first woman to sit on the board. Margaret professes that she loves being part of what she refers to as the Barclays family, from meeting the myriad faces of the Barclays group on her travels through Africa to nurturing her staff. “I have a passion for people. Just seeing my employees grow in their role or move onto bigger roles. Whether it’s a cashier rising through the ranks or a manager taking on more responsibility. I get a lot of satisfaction out of that,” she says.
She makes a point of meeting her staff as often as possible, even joining in group events like last year’s women’s football championships in which she scored the winning goal. “That’s me with the girls,” she says, pointing to a framed photograph of a team sporting white strips and smiling broadly. “My goodness I was a wreck when the game ended,” she exclaims, bursting into laughter.
Life off the pitch is rather more demanding though. As a significant employer in the country, and a Zambian commentator on the banking industry, Margaret is often asked to get involved in local events or speak to the press. These, coupled with her challenging role as managing director, often take their toll on her free time. “Work-life balance is very difficult for me as a woman. I have a young family who need me and it’s difficult always to be there for them.” She makes a point of leaving weekends free for her children and husband, escaping to Lake Kariba on the border with Zimbabwe for some family bonding. But she admits that it’s not easy juggling a demanding career with a family. “I’m not sure I get it right, but I’m doing my best.”
Her status as one of the few high-profile Zambian women in the private sector is clearly important to her. She’s proud that Barclays has grown into a formidable player among the several commercial banks in Zambia, all of which are regulated by the Bank of Zambia. And with a healthy profit and reserves in excess of ZMK45bn, Barclays ranks as one of the most successful in the country. But Margaret has her sights set on making her mark as managing director. “Right now my challenge is to ensure that Barclays remains the leading and to be the most admired financial services institution here in Zambia,” she says with conviction, before adding rather modestly, “I think I still have some way to go.”
Landlocked Zambia, situated in the northern edge of southern Africa, is bounded by no less than eight countries. Angola to the west, the Democratic Republic of the Congo to the north, Tanzania to the northeast, Malawi to the east, Mozambique to the southeast, and Zimbabwe, Botswana and Namibia to the south. Shaped like a giant butterfly, Zambia covers a total area of just over 750,000 square kilometres and is home to over 10m people. There are 72 different ethnic groups or tribes in the country, each with their own language. Zambia achieved independence in 1964 and was subsequently ruled by Kenneth Kaunda and his United National Independence Party. Kaunda led the country for 27 years, transforming Zambia into a one-party state. By the mid-1980s civil unrest, triggered by sky-high prices, forced Kaunda to reintroduce multiparty democracy and spelt the end of his rule. By 1991, Frederick Chiluba of the Movement for Multiparty Democracy (MMD) took up the presidency, introducing reforms, privatising government business, and driving down the value of the Zambian currency, the Kwacha. Chiluba’s successor, Levy Mwanawasa, also of the MMD and elected in 2001, has continued in the same vein, in addition to seeking support from the IMF to ease the country’s large debt burden.
In the next issue of student accountant, Anna Chifungula FCCA and auditor-general of the Republic of Zambia, talks about her career in the civil service and why she thinks she can make a difference.

 

No comments:

Post a Comment