Source: ‘SA companies must invest in Zim’ | The Herald May 3, 2016
GOVERNMENT wants South African companies exporting to Zimbabwe to also bring investment into local industry in order to create jobs and improve the tight liquidity situation in the country.
Deputy Minister of Industry and Commerce Chiratidzo Mabuwa said Government needs to take a firm stand and demand that South African companies also invest in local industry to produce locally.
She also lamented failure by industry to tap into the $800 million expenditure by local mining companies procuring equipment from other countries due to lack of capacity.
The deputy minister made the remarks during the inaugural CZI Manufacturers Conference at the 57th edition of the Zimbabwe International Trade Fair, which ended in Bulawayo on Saturday last week.
“It is time that we do not apologize for anything, we need to be invested here in Zimbabwe in order to create the jobs. There is no need for us to be exporting the little (liquidity) that we have. We are exporting it all out of this country and we are exporting jobs,” she said.
South Africa is Zimbabwe’s biggest trading partner, but while 60 percent of Zimbabwe’s predominantly raw exports find their way into its Southern neighbour, trade is grossly skewed in South Africa’s favour with local industry struggling to compete with imports from that country due to the high costs of producing locally.
Zimbabwe is also battling an unsustainable mismatch between imports and exports with the huge trade deficit partly the reason it is plagued by frequent bouts of tight liquidity crises .
Zimbabwe’s trade deficit stood at $2,9 billion last year, but the deficit is projected to narrow by 2 percent to $2,8 billion this year
“I was saying to South African companies when they came here, ‘you are busy importing your products into Zimbabwe, can you please import the market as well; bring us your customers to buy here.
“I said do not take the little hard foreign currency and export it all by bringing your products, this is the simple message that we should talk with straight faces as Zimbabweans and we can (propagate) buy Zimbabwe (campaign), but if we do not talk to it, we are not being true to ourselves,” said Deputy Minister Mabuwa.
Deputy Minister Mabuwa, responding to assertions by Confederation of Zimbabwe Industries president Busisa Moyo that facilities of about $20 million from global credit provider Crown Agents, could be too big for most firms, also said local companies should invest with a view of the SADC and COMESA markets.
The CZI president had opined that facilities of $20 million, which are the standard financing packaging Crown Agents indicated it could arrange for qualifying local companies, could be more than what most producers need relative to the size of their markets.
“We need the $20 million facilities; they (companies) would have to think outside the box and plan for the bigger market, which is being presented through Africa.
“Think Africa and think beyond, that is your market, we are a 14 million population country and not a 14 million people market, we are way bigger than that, we will do the rest in marketing your products,” she said.
The deputy minister also implored the local representatives of the international credit provider to consider a way of arranging financing without putting local firms through the rigours of due diligence.