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TCCIA Investment Co., NICO and levelling share sales playing field
2005-04-20 07:34:51
By Nimi Mweta
As the debate as to the potential role of the National Investment Co. Ltd (NICO), as the pioneer alliance of indigenous investors seeking a stake in the economy was subsiding, a new feature has come up.
It is the formation of a similar firm, this time as a part of operations of the Tanzania Chamber of Commerce, Industry and Agriculture (TCCIA). Contrary to NICO, it didn’t carry an aspect of fanfare, of a representative nature.
While the two events in a strict sense had nothing in common, there is a clear impression that the second event sort of qualifies the first initiative.
It provides it with a mirror of its area of relevance, or sphere of competence as it were, marking out what was justifiable to demand as an investment company, and what perhaps lies outside rational expectations.
How far has this change affected the public investment mood?
The difficulty about responding to this question is that one would be interpreting silence, rather than views or explicit responses about the set up.
For instance, would either of the two investment firms demand that it be included as a matter of priority in whatever privatisation process might be on-going at the moment? Does the presence of a new investment company change what was earlier expected, or rather helps to broaden it?
How the situation is clarified will depend upon the mood attached with the formation of the two investment companies, or perhaps more specifically the second.
If its spirit is in tune with the first, it may provide an occasion to seek a modus operandi of involvement of indigenous investors in various privatisation projects, in which case the spirit of inclusion is maintained.
Alternatively, it becomes a competitor, even about ideals.
When the two firms compete about ideal scenarios in which indigenous investors might be involved in one or other “sensitive” privatisation, the result is a dampening of this quest.
For a representational quest, an ideal picture of what should happen, survives the test of credibility only if it is acknowledged in consensus, not if a portion of stakeholders might shout it down.
When this happens, it loses its wider appeal, solidarity.
Given the fact that so far there is just silence on that question, it isn’t easy to set out an attitude or outlook likely to be adopted by the TCCIA investment venture.
But one thing is, there is an unavoidable effect of dampening the “set representational terms” enunciated by NICO as it canvassed for popular participation, in what looked like a plebiscite.
In the new venture, there isn’t more effort than a share offer as in TOL, etc.
This way of doing things already imposes its own attitude, which is in based on routine stock exchange attitudes, in which case one walks into the trading hall and sees how the stock price grips.
No prior setting or extra-trading operations, like a specific pattern of share sales in some coming venture for instance in the case of the National Microfinance Bank (NMB).
Pure stockbrokers accept that all bidders are equal, period.
In analytical terms, the (necessary) antidote to the NICO pioneering venture has already been given, on the basis of teachings of German sociologist Max Weber.
He taught (around 1920) that everything in history (huge political or religious movements) starts with charisma, where only the lofty ideals count, and after it has won and takes office, ossifies into a bureaucracy.
There it shifts from ideals to a respect for rank, power, profit, fortune, friendships, loyalties, alliances - everything that distinguishes loftiness from bureaucratism.
There was something messianic or charismatic about NICO, as a union (fusion) of energies of indigenous investors, to make a difference in how various (sensitive) sales of public firms are conducted.
With the start of another investment venture, which isn’t explicitly based on such aspirations but stock exchange realism, it means this aim is now a suggestion. It no longer serves as a practical demand that must soon be realised.
Interpreting this situation in terms of levelling out the playing field is complicated, since it depends on how one evaluates the NICO projection.
With its wider ranging objectives slightly tempered by the new venture, it means the physical playing field might not be levelled up as intensely as it may first appear it could have.
But in practical terms, restoring realism to this exercise levels the psychological set up, where no clash of wishes and possibility remains.
One dampens indigeous aspirations so as to anchor them even more firmly.
With the new set up, chances of interaction of shares from specifically indigenous investors, local investors generally and bank intermediation are likely to rise.
This wouldn’t be the case if the level of interaction would be small, or if the indigenous investment sphere was markedly autonomous, as it may have appeared to be intention at a certain point.
It is true however that by the time financial statements are produced, this aspect loses its touch.
In addition, both NICO and the TCCIA Investment Co. seem to be interested in forging preliminary relationships with partners from the European Union, or such aid-related credit sources.
One model for this is the CRDB Bank, whose operational structure has been greatly boosted by the DANIDA presence.
This has been done on some kind of joint venture, which is different from having to privatise it first and then a rather hostile bidding for shares.
In that case similar associations may come up with NMB and others, shedding the strident preferentialism of old.
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