Nqobile Tshili, Business Correspondent
BULAWAYO has run out of serviced industrial land as more potential investors seek new space to set up businesses in the city, Town Clerk, Mr Christopher Dube has said.
Last year the country’s second largest city received an overwhelming number of potential investors, he said, and could not accommodate all of them due to shortage of serviced industrial stands.
“In 2016 the City of Bulawayo continued to receive several enquiries on investment opportunities particularly in the services sector. Regrettably, there was a serious shortage of serviced industrial stands to meet demand. Council had to rely on surrendered stands,” he said.
Once regarded as the hub of manufacturing industry in the country, Bulawayo has in the last decade suffered severe de-industrialisation and loss of jobs. The demise of giant firms such as the National Railways of Zimbabwe, the Cold Storage Company and the clothing industry, which were among the biggest employers, has inflicted a strain on the entire value chain industry in the city. Mr Dube said council was committed to attending to investor interests in line with the Government’s ease of doing business thrust. In that regard he said council was considering reviewing downwards some tariffs.
“Bulawayo has embraced the Government’s initiative on improving the country’s image through the ease of doing business reforms. Several processes and procedures were interrogated and streamlined. These include the payment for shop licences in relation to the sizes of the shops as opposed to the standard tariff for all sizes, expedient processing of building plans including introducing the electronic version and review of several tariffs where the high charges were not justifiable,” he said.
Mr Dube said the council’s operations were being stifled by the council’s expenditure that surpasses its revenue collection.
He said this problem was caused by the failure by rate payers to pay their dues citing that by end of November the municipality was being owed $144.9 million.
“Monthly cash collections averaged between $4.8 million and $5.6 million. Council`s expenditure commitments outweigh current monthly collections. On average, $7,5 million monthly cash collections would cover council`s needs for the provision of services,” said Mr Dube.
“The bulk of capital development projects could not be implemented due to scarcity of capital. Regrettably, service delivery was compromised due to lack of funding,” he said.
Mr Dube said delays in paying service providers due to cash shortages strained relations between council and its suppliers.
He said some of the suppliers were now demanding cash payments before rendering services.
“Cash flow challenges hindered council from paying its trade creditors on time thereby negatively affecting relations with suppliers. Failure to pay suppliers within 30 days has seen an increase of suppliers who are now demanding cash up front,” he said.