Zim economy transforms for the better

Harare Bureau
ZIMBABWE’S economy is tranforming for the better, with a number of companies that had hit capacity utilisation of one percent bouncing back to greater production, data from Government shows. Further, the African Capacity Building Foundation (ACBF) — an international body concerned with development issues across the continent — has lauded Zimbabwe’s economic resilience and homegrown transformation strategies.

In recent months, new manufacturing plants have been opened in different parts of the country, creating hundreds of jobs within short periods, and to maintain the momentum Government has lined up several production-stimulating strategies like curtailing imports and funding key companies.

Soon, all State departments will be required to prioritise local suppliers, and teams will be dispatched to retail outlets to check the domestic-import balance. On Independence Day, President Mugabe said the economy was recovering and “there has been a very comfortable resuscitation of companies that had closed or were on the brink of closure”.

He said this had preserved jobs and created new ones, as industrial production rebounded thanks to accelerated Zim Asset implementation under the 10-Point Economic Growth Plan. The plan includes a rapid results framework, revitalising agriculture and mining, value-addition and beneficiation, financial inclusion and infrastructure development and tourism promotion.

Industry and Commerce Minister Mike Bimha told our Harare Bureau that many sectors were showing flickers of life, with several having reached 100 percent capacity utilisation, while some like Cairns foods had grown from 15 to 80 percent.

His Finance and Economic Development counterpart Minister Patrick Chinamasa said fiscal measures to revive industry were bearing fruit, while ACBF director Dr Thomas Munthali said other African countries could learn much from Zimbabwe’s strategies.

Minister Bimha said, “Two weeks ago, I briefed Cabinet on the status of our industry for the period October 2015 to March 31, 2016. The report shows that though we have challenges, there are a lot of positives we can take from the manufacturing and industrial sectors. Contrary to some views, there is no crisis, but we are actually improving. Some of the sectors have seen industries achieving 100 percent capacity.

“Well over 100 people were recruited (by Cairns Foods) in the last quarter as a result of that. Furthermore, the company launched an outgrowers scheme which will benefit almost 1 760 farmers in Manicaland province.”

According to Minister Bimha, agro-processor Surface Wilmer is operating at 100 percent capacity while Bulawayo-based United Refineries Limited is now averaging 90 percent. Chemical manufacturer Zimbabwe Phosphate Industries previously operated at 15 percent capacity, but has hit 100 percent after securing a US$10-million loan. Sino Zimbabwe is at 80 percent capacity, while motoring giant Quest Motor Corporation’s production capacity has increased from three to 12 percent.

Deven Engineering has turned around its dire circumstances, rising from one percent capacity to 15 percent. In textiles and clothing, Archer and Paramount were on the brink but have enhanced capacity to about 17 percent.

Minister Bimha said drought was an impediment to agro-processing and authorities were working on various mitigation strategies. He said Government was also on course to curtail the influx of cheap imports that sideline local products.

“One of the things we are doing in this regard is to support local industry through management of imports. This has been done through a number of Statutory Instruments that have been gazetted to remove a number of products from the Open General Import Licence.

“This means if products are removed from the Open General Import Licence, one will have to get an import licence if he/she wants to import. And to get such a licence, we have to be satisfied that the product is not available locally. There is clothing and shoes, blankets, sugar and cooking oil, among others.”

Minister Bimha also said: “Another measure is resource mobilisation, putting out money for industry; we still have the Distressed and Marginalised Areas Fund, Zetref and a Reserve Bank of Zimbabwe fund that targets various sectors and companies. We are getting money from Africa Development Bank for certain sectors. We have also submitted some projects under China’s US$60-billion facility for Africa. These projects include Sunway City Hitech, Sunway City Medical Park and a motor vehicle assembly plant. There is also the Common Market for Eastern and Southern Africa regional support mechanism. It is going to facilitate issues to do with cotton and clothing, our leather strategy and capacity-building for Government and quasi-Government institutions.”