COMMENT: Industry should be capacitated for re-tooling and working capital

17 Nov, 2020 - 00:11 0 Views
COMMENT: Industry should be capacitated for re-tooling and working capital Minister Sekai Nzenza

The Chronicle

INDUSTRY is beginning to enjoy the fruits of the Government’s comprehensive economic reforms meant to facilitate the revival and growth of companies. Companies in Bulawayo and the Midlands province have already increased their capacity utilisation to 60 percent.

According to a survey conducted by Government and the private sector, the country’s manufacturing sector is on strong rebound attributed to a stable macroeconomic environment since the introduction of the foreign currency auction system last June.

Industry and Commerce Minister Dr Sekai Nzenza said recently that industry has commended the forex auction system which has enabled many companies to access affordable forex to import raw materials and equipment for retooling.

The manufacturing sector requires about US$100 million a month and the auction system has been availing more than that every month.

The economy is on a growth trajectory and we want to commend the New Dispensation for coming up with many pieces of legislation meant to support the revival of local industry as well as promote consumption of local products.

Industry has said it fully supports Government’s local content policy and the challenge therefore, is for industry to push hard so that as many companies as possible operate at full throttle.

It is pleasing to note that companies in Bulawayo, a city which used to be the country’s industrial hub, are already operating at 60 percent capacity despite the Covid-19 economic disruptions.

Indications are that many of these companies will soon be operating at full capacity if the prevailing momentum is maintained.

Industry has said it has the capacity to produce substitutes for many of the products being imported and all it needs is Government support. What is also encouraging is that industry is saying the substitutes for imported products can be produced at a much lower cost contrary to common perception that locally produced products will be expensive.

The present scenario whereby 60 percent of the products in the retail shops are imported cannot be allowed to continue. We have said it before that Zimbabwe’s economy cannot grow from retailing imports and that is exactly what industry is also saying.

Industry should therefore, be capacitated in terms of resources for re-tooling and working capital. Industry has said it has the capacity not just to produce substitutes for imports but also cheaply which means the prices of the locally produced products will be much cheaper compared to exports.

The backbone of any country’s economy is a vibrant industry that does not only produce for the local market but also surplus for export.

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