Zambia Forest and Forestry Industrial Cooperation (ZAFFICO) was early this year assigned new expectations by the Industrial Development Corporation (IDC) which were unveiled in January 2023. The new board looks fairy balanced but much more need to be done on the expectations. With nine months down the line, a critical analysis on the IDC’s expectations has shown that there is lack of vision to make the company viable, competitive, sustainable, profitable and most important diversify. I believe my piece of opinion will set a scene for a feisty confrontation. Let’s have a look at each expected outcome and digest as availed to the public on the 18th of January 2023 by IDC acting group CEO Henry Sakala:

“(1) Transformation of the company: IDC bestores the 50,000 hectares of ZAFFICO to be too small for the company and expects it to grow beyond”. However, it is not long ago when ZAFFICO was undergoing massive expansion in some provinces such as Western, Northern and Muchinga provinces. The company expanded and diversified to tea and cashew nut in Kawambwa and Mongu respectively. Soon after establishment, the IDC snatched the two big projects from ZAFFICO for no substantial reasons. Currently, the same IDC wants ZAFFICO to expand and one can wonder how?

In addition, it is unfortunate that IDC is giving the role of soliciting for cooperation’s funding to the Ministry of Green Economy. Even when the ministry has opened up the gates wider to access funds, IDC has a bigger role to play in sourcing for expansion funds for ZAFFICO.

‘‘(2) IDC expects that ZAFFICO will implement the expansion of plantations to all the provinces, especially where there are no forests as a National Asset. The IDC CEO urged ZAFFICO to diversify into processed wood and wood products which would compete on the market favorably’’. Unfortunately not all provinces are scientifically favorable for growing trees due to unsuitable climatic and edaphic factors. Hence, unattainable expectation. The solution is to diversify to other products like cashew nut production and Jatropha. For example, Pine and eucalyptus plantations can hardly be established in Western, Southern and Lusaka provinces. So, how does IDC expect ZAFFICO to expand its tree plantations in such areas? It cannot happen.

“(3) Value Addition: IDC expects ZAFFICO to participate in other areas of the forestry value chain by diversifying into processed wood and wood products which would compete on the market favorably and help cut the cost of imports of finished wood products into the country and save FOREX’’. However, ZAFFICO does not have timber processing plants to process round wood to finished wood products such as sawn wood, boards, panels, etc. like wood processing which was owned by ZAFFICO before privatization. IDC must look for money to expand ZAFFICO wood processing factories to meet the expectations. As long as ZAFFICO remains in its current state, this expectation can never be achieved because there are no wood processing factories. How does IDC even talk about diversifying wood products in this situation? There is no magic to these things but recapitalization. Forget about value addition until the company is recapitalized to have its own wood processing plants.

I would agree to the fact that ZAFFICO is trying hard to manage the small pole treatment plant based in Kalulushi, though it has little capacity to meet the demand of poles on the market. As such, it is being overshadowed by foreign companies from Zimbabwe and South Africa. Pole treatment plant is a good way to increase value addition and IDC must ensure that it funds such investments to ensure growth of the plant and be able to meet local demand and aim to export.

“(4) Enumeration of forest inventories –IDC expects the new Board to ensure that this exercise is expeditiously completed, and the recommendations implemented accordingly’’. I don’t see a reason why IDC must be interested in enumeration exercise. This is purely a management task. It does not qualify to be among the strategic directions IDC should be talking about. IDC is the highest office which must provide direction of the corporation. Forest inventories are purely a management task which the company undertakes. Therefore, it does not qualify to be in the expectations of IDC please.

In my view, forest inventories are not accurately obtained. Figures are miscalculated and tend to miss inform management decisions. ZAFFICO must ensure an independent company is hired to conduct forest inventories periodically to avoid wrong information. Incorrect enumeration results have highly contributed to loss of revenues because stocks are under counted to the benefit of individuals and saw millers. Saw-millers usually conduct irregular activities and there is no system in place to stop the vice. This is a huge challenge which the company has failed to manage.

“(5) IDC expects that ZAFFICO develops early maturing tree varieties so that the average maturity profile is reduced to competitive levels of around 6-10 years as opposed to the current 25-30 years’’. This is a non-starter expectation. Firstly, ZAFFICO has no plant laboratory to carry out plant breeding experiments. Developing tree varieties need a high tech laboratory and takes a long time. Secondly, plant breeding are a specialized branch of forestry requiring expertise. ZAFFICO has not experts in tree breeding. Thirdly, plant breeding laboratory must be installed with specialized equipment yet there is no budget to establish such a facility. As a result, this is unattainable expectation.

‘’(6) Title Deeds: I would like to see ZAFFICO with Title Deeds in all its plantations. These are assets for the company and should therefore be secured’’. I am not sure to what extent ZAFFICO has gone with obtaining title deeds for the newly established sites in different provinces. Most of the new sites are sitting on traditional land. In Western Province, the cashew nut project was discontinued from ZAFFICO and same applies to Kawambwa tea. If the titles were obtained or changed, this must be a challenge.

(7) IDC expects the New Board to take tough discussions in driving the company to prosperity. I would urge you to constantly ensure that you do not lose sight of those good tenets of corporate governance to ensure that you positively contribute towards the sustainable transformation of ZAFFICO,” said Sakala. It is not clear what this expectation substantially looks for. IDC must be tough to the board if it is to deliver its mandate without interfering with the management. Given the unattainable expectations, it is impossible for ZAFFICO to achieve prosperity.

Overall, expectations of IDC on ZAFFICO are not practical, not factual and not attainable. The strategic plan determines the future of the corporation yet no plan to make the company function. No single expectations has been so far achieved through the nine months period of the new board and new expectations by IDC. This is a real example of the stagnant organization. Clearly the evaluated expectations cannot be achieved in the remaining three months mainly due to IDC’s lack of understanding of unattainable expectations lumped on ZAFFICO.

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