‘Manufacturing sector capacity utilisation on the rise’

Source: ‘Manufacturing sector capacity utilisation on the rise’ | The Herald October 5, 2018

Minister Nqobizitha Mangaliso Ndlovu

Africa Moyo recently in NORTON
Capacity utilisation in the manufacturing sector is rising, mainly driven by the benefits of Statutory Instrument 122 of 2017 (formerly SI64 of 2016), which restricts the importation of products that can be locally made.

This was revealed on Wednesday by Industry and Commerce Minister Nqobizitha Mangaliso Ndlovu after a tour of five companies; Best Fruit Processors, Dandy, Wilsons Furniture, Central African Batteries (formerly Lucas Batteries) and Hastt Zimbabwe.

“What I have seen here in Norton leaves me in no doubt that indeed the 2030 middle class economy is possible,” said Minister Ndlovu.

“Indeed, capacity utilisation is increasing. We wish to be there for the companies; we wish to be a listening Government as the President (Emmerson Mnangagwa) has proclaimed. We wish to be able to respond to the challenges they are facing . . .

“What I saw in those companies and the impact they are having with farmers, shows that they are actually increasing production and employment is rising.”

Best Fruit Processors CEO Mr Asere Shumba, told Minister Ndlovu and his delegation that they have capacity to supply the local market with fruit paste but are hard done by imports.

“Where we are, Minister, we now have enough paste for Zimbabwe. We can supply the country in terms of fruit paste. What we would request is, given the foreign currency situation, we should actually be looking at whether we should to stop the importation of paste because it’s here in the country,” said Mr    Shumba.

He said considering the quality of tomato yields — which are rising — they are seriously considering to export and a team has been dispatched into the region to explore opportunities.

Continued imports of tomato paste is now affecting the uptake of tomatoes from farmers who were contracted by the company since 2015.

Mr Shumba implored Minister Ndlovu to cause the removal of bulk paste from the Open General Import Licence, to ensure foreign currency is conserved while at the same time keeping farmers busy in the fields.

Best Fruit Processors has 180 contract employees.

Wilsons Furniture CEO Mr Jim Wilson, said despite foreign currency challenges, the company is set to open another 4 000 square metre factory in Norton.

“The biggest challenge is to balance between what we export and what we import and to bridge that gap. We are obviously growing our exports, we export about 35 percent to 40 percent of our production and we would like to take that to 50 percent.

“The challenge is to continue getting raw materials for the manufacture of products,” said Mr Wilson.

The company imports chip board, foam and fabric, among others, which are not manufactured locally.

But Mr Wilson thinks the reintroduction of foreign currency accounts for exporting firms will transform their operations.

Wilson Furniture employs 350 people and hopes to increase the number to over 400 when the new factory opens.

The company, which is operating at 75 percent capacity, has been producing a range of household, hotel and office furniture for over 50 years.

It also makes billiard tables which are exported to the US where they fetch an average of $800 each.

Other export markets are South Africa and Zambia.

Central African Batteries, which is under judicial management, is now being run by former workers.

Mr Paradzai Marufu, a quality inspector at the firm, told Minister Ndlovu that they need capital injection to boost the business.

The company used to export batteries in some Southern African countries including Zambia but was reportedly run down by former owners.

Dandy, which makes bubble gums and chewing gums, has also benefited from SI 122 to increase capacity to 47 percent from 21 percent in the first half of 2016.

Factory Manager Mr Wisdom Nyakuzviranga said they export 30 percent of their production.

The tour of industries in Norton was organised by the area’s House of Assembly Member Temba Mliswa.

Minister Ndlovu said such tours should be replicated across the country to ascertain each province’s contribution to GDP, in line with Government’s thrust towards devolution.