Govt mulls tweaking tariff regime

Source: Govt mulls tweaking tariff regime | The Sunday Mail May 15, 2016

Livingstone Marufu
GOVERNMENT is considering reviewing the import tariff regime before the end of the year to stem the rising tide of imports, increase production capacity and narrow the trade gap.
The envisaged interventions would add to broad measures, such as removal of specified goods from the general import licence, that have since been implemented.
A depreciating South African rand has made imports attractive while making local producers uncompetitive.
Industry and Commerce Minister Mike Bimha told The Sunday Mail Business that internal devaluation could help narrow the country’s negative trade balance.
“We must promote production capacity for our local industries so that companies can produce quality and affordable goods and create an enabling environment for investors to get funding for them to get new equipment and also buy other necessities to raise their capacity utilisation.
“If the companies are operating at 20 percent or 30 percent, their costs are also high . . . so we must support local producers with capital and efficiencies.
“We must also support them in terms of making them produce more goods, but, more importantly, we must have measures that support them in terms of imports, and we have to play around with the tariff regime,” said Minister Bimha.
Government banned importation of second-hand clothes, shoes, leather products, blankets, maize meal, meat, sugar and flour from September 1, 2015.
Section 12 of Statutory Instrument 21 of 2010, as amended in March, requires all public institutions to procure at least 50 percent of their goods and services from local suppliers.
“Apart from playing around with imports, from removing the goods from general import license, we must support productive capacity to produce more goods.
“It’s a combination of many things and encourages our people to want to buy locally. There are some who have a tendency of importing goods with a view that they are of a superior quality.
“We can’t continue to protect our industry for a long time . . . we need to come out and compete with international products because competition is here to stay,” added Minister Bimha.
ZimTrade is working with the Standard Association of Zimbabwe to assist local manufacturers — big and small — to produce goods of international quality.

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