Jason Kazilimani, CEO KPMG Zambia: power and agri biggest opportunities
“CFOs that don’t read and don’t network, won’t grow,” says Jason Kazilimani, senior partner and chief executive officer at KPMG Zambia. According to the senior partner there are two types of CFOs in the country: modern, world-class finance executives with international experience and “some others that call themselves CFOs, and yet only do the bean counting”. That is why there is enormous potential to improve the skills and networking capacity of Zambian CFOs, he says. “I would like to see much more emphasis on strategy.”
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Jason was born in the mining town of Kabwe and is midway through an impressive career that has seen him rise to become CEO for KPMG in Zambia. CFO South Africa spoke to him about the reason he became an accountant and not a lawyer, his experience as an ACCA-trained professional, his experience in the UK and Nigeria and about the business opportunities in Zambia. "The power sector and agriculture provide massive investment opportunities!"
Why did you become an accountant?
"I always enjoyed my debates at school and because of that I wanted to become a lawyer. While I was waiting for the results of my application for the school of humanities, my dad said I should broaden my horizons and talk to some of his friends about career options. That is when I met with Emmanuel Hachipuka, the then managing director of Zambia Railways, who was one of the first fully qualified chartered accountants in Zambia. I still remember I walked 6 kilometres to see him and I was very impressed with his office. He told me there that there were not enough qualified accountants in Zambia, while there was a surplus of lawyers. I also spoke to a cousin who was studying for an ACCA qualification and she told me all about it. That is when I changed my mind and I successfully applied for a scholarship with ZCCM, Zambia Consolidated Copper Mines."
"Upon finishing my training, I joined ZCCM and worked there for two years. KPMG was our auditor and I worked with them in my group accounting role. They must have been impressed with my work, because they asked me to join them and I took the job because of the diversity working for KPMG promised."
What was the ACCA training like?
"It is an international qualification that, unlike in South Africa, is very well recognised in Asia and countries like Zambia, Zimbabwe but also increasingly in West Africa. At the time, Zambia didn't have its own accounting qualification, so ACCA and CIMA were our only options. It stood me in good stead when I worked for KPMG in the UK and Nigeria, because the ACCA qualification is well-respected all over the world."
What did you learn while working abroad?
"When I went to the UK with my wife and son in 1998, I was a 29 year old assistant manager. It was a great career move, especially because I didn't go to KPMG's London office where I would have been pushed into a specialist role. Zambia was a small office that required generalists, so I went to our regional office in Southampton where I worked with a variety of clients and it really helped me gain confidence and kick-start my career."
"When I went to Nigeria in 2007, I had already been made partner in Zambia. I joined the financial services team as an audit partner. We had banking and insurance clients and I led some IFRS conversion projects, as Nigeria was moving away from its own accounting standards at the time. It was a turbulent time in the country, during which I learnt a lot and I came back to Zambia as a pretty well-rounded professional."
How does Zambia compare?
"The funny thing is that the banking sector in Zambia was more advanced than the one in Nigeria in 2007, but we have now been overtaken. Nigeria has managed to encourage many of its diaspora with world-class skills to return and that has really helped that country move forward. Having said that, Zambia is also moving in the right direction. We now have new developments such as a bond and derivatives exchange and a properly functioning credit rating agency."
"The pace of development has not been as fast as I would have liked in Zambia. Between 2002 and 2012 things were going well and we had a steady economic growth of 7%, but with the depreciation of the kwacha, high inflation, the low copper price and load shedding we have our challenges now."
Where are the biggest investment opportunities in Zambia?
"Because of load shedding the energy sector provides big opportunities. A while ago there was a lot of excitement when the government announced raising the tariffs or electricity, which would make the market viable for other players. Unfortunately that decision was reversed. Where I live, we have load shedding for eight hours every day. The power supply to mines was cut, reportedly by 30%. At home we're now cooking on gas, we're making smarter choices. Increasingly, companies are now buying generators. There are a number of big power projects in the pipeline, but only the Maamba coal mine thermal facility is coming online this year with an extra 300 megawatts. The other projects will take longer. Combined with the low copper prices, that is a double whammy for the Zambian economy. It is not an easy time to be financial policy-maker at the moment."
"The greatest potential in the country is in agriculture, which has been paid lip service for a long time without much happening. Around 58% of the country is suitable for agriculture, yet only 14% is currently used. We could feed the whole of southern Africa. Despite the drought, we also have a lot of water sources in Zambia to provide irrigation."
"The Nigerian business of Aliko Dangote built a huge cement plant on the Copperbelt and had to build its own power plant, but not a lot of companies can afford that. At the moment, everything hinges on the power sector, especially because investments in agriculture will take a long time to start yielding."
What is the biggest misunderstanding about Zambia with investors?
"The biggest frustrations and irritations are load shedding and the intermittent internet connectivity. But the road network is improving, as all of our main roads are being tarmacked. The quality of human resources is also good, especially with some returnees from the diaspora. I am expecting this to continue as the new constitution provides for dual citizenship, which helps significantly for people considering returning. Zambia is not a backwater anymore. You find almost all the facilities here that you find in Johannesburg. The level of sophistication has increased in the cities, although outside Lusaka, Kitwe and Ndola not much has changed."
What are the most important developments to watch in 2016?
"The presidential and parliamentary elections in August, the inflation rate and the copper price are the most important. These three are interlinked. Having said that, Zambia's elections are always peaceful - even when the power is transferred to another party."
Globally CFOs are making the transition from number crunchers to business partners - how do CFOs in Zambia fit in that picture?
"There are two types of CFOs here. CFOs at multinational companies like Barclays or Unilever have the same approach to work as their colleagues all over the world. Those are the real CFOs. Then there are some others that call themselves CFOs, who only do the bean counting. At KPMG we mostly deal with blue chip companies, which have real CFOs. In my experience, the best CFOs are the ones that work at multinationals or have worked abroad, although there are a number of exceptions, either way."
"A lot of upskilling needs to be done of our local CFOs. I would like to see much more emphasis on strategy. I'd like local CFOs to take a more active role in their businesses. What is needed is more exposure, more effective networking, more training and more reading. I have noticed that a lot of people, once they have acquired their qualification, stop reading and stop learning. CFOs that don't read and don't network, won't grow."