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Busisa Moyo

Business Reporter
THE Confederation of Zimbabwe Industries (CZI) will today launch a Business Confidence Index, which allows the industry body to collect and review data on the performance of the manufacturing sector on quarterly basis. CZI president Busisa Moyo said the business index would be launched in Bulawayo.

“On Wednesday (today) we’ll be launching at CZI what’s called a Business Confidence Index. We normally have an annual manufacturing survey as you know but, we’ve decided that we need something that’s more frequent, which is a quarterly business index.

“It allows us basically to have a dip stick of what’s happening in industry, the level of confidence in industry,” he said.

Moyo said the performance index would detail operations of industries according to regions and also show the outlook.

The report is envisaged to cover the purchasing index which is a critical component in company operations.

Moyo said the annual manufacturing sector survey would be launched on October 28.

He highlighted that the business sentiment this year was lower than the previous years.

“Preliminary performance results in certain sectors has gone down but in other sectors it has gone up, so we’re waiting to see the numerical effects of that.

“The challenge we’ve about the manufacturing sector survey is that it’s not weighted so capacity utilisation for example, isn’t weighted or factored so that a big company like Delta if they’ve a high capacity utilisation there’s a stronger weighting to them because by value they’re bigger,” he said.

“So, a small-company like the one I run, ranks equally as Delta in that survey and we just average it out which may not be a very accurate way of depicting what’s happening within industry.”

Last year capacity utilisation in the manufacturing sector was 36,3 percent, which Moyo said was very low.

According to the mid-term fiscal policy review, the growth of the manufacturing sector was 1,6 percent for the first half of the year.

Of late, there has been depressed demand resulting in a marked reduction in spending capacity due to company closures and retrenchments.

Capacity utilisation in the manufacturing sector has been choked by operational constraints such as intermittent power constraints, tight liquidity and stiff competition from cheap imports.