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Business Reporter
COVID-19 is expected to impact China’s global trade for several months with Zimbabwe also feeling the pinch in terms of exports to the Asian giant as well as disruption of critical imports, ZimTrade has said.

Already progress in capital projects being developed by Chinese contractors in the country such as the US$1,4 billion Hwange units 7 and 8 expansion are in limbo while several companies that import raw materials from China are also affected.

China is one of the country’s top trading partners, with Zimbabwe exporting US$974 million worth of goods in 2019 according to Trade Map.

In its latest monthly newsletter, ZimTrade noted that there are cases where Chinese import companies are cancelling orders due to port closures and hence Zimbabwe’s exports to the country are affected.

“With China having shut down its manufacturing centres and closed its ports, there will be a resultant decrease in demand for the Zimbabwean products,” said the trade promotion body.

“At the same time, closed borders in China means Zimbabwean manufacturers that rely on raw materials and other consumables from China will be affected and the spiral effect of reduced manufacturing in China will have a toll on Zimbabwean industries.”

According to Trade Map, China is the third country that Zimbabwe imports from with a total imports value of US$368 million recorded in 2019.

The major products that Zimbabwe imports from China include machinery, mechanical appliances, boilers, electrical machinery, equipment, vehicles, chemical products, rubber, and plastics.

Zimbabwe mainly imports raw materials and machinery for production purposes, which will then be used to manufacture different products some of which are exported.

Going forward, ZimTrade said it was important for local companies to start considering locally produced raw materials that can support businesses.

“This can be easily achieved if stronger linkages are created between suppliers and buyers so that they can strike a balance between supplying the quality products and right prices,” said ZimTrade.

“This import substitution will allow the country to create employment and at the same time preserve the scarce foreign currency.”

In his independence address on Saturday, President Mnangagwa called on local industries to diversify and embrace modern technology including input from tertiary institutions in order to become formidable hubs of import substitution.

Import substitution industrialisation is crucial for the country as it takes bold steps towards achievement of an upper middle-income status by 2030.

As such, the President noted that the potential to achieve this desired reality is being evidenced by the awakening creativity and innovative capability displayed in the domestic production of materials towards the fight against Covid-19 (Coronavirus) pandemic.