Stabilisation to growth: Policy reforms bear fruit as imports substitution gain traction,Transformation on course despite inflationary shocks. President Mnangagwa is welcomed by party supporters at the Bata Shoe company premises after touring companies in Gweru

Prosper Ndlovu in Gweru
ZIMBABWE’S economy has transitioned from stabilisation to growth as policy reforms being spearheaded by the Second Republic continue to register positive results as evidenced by the increase in capacity utilisation and the shift towards import substitution, President Mnangagwa said yesterday.

Despite persistent speculative exchange rate distortions and the recent global supply chain disruptions linked to Covid-19 and the ongoing Russia-Ukraine conflict, which have induced inflationary shocks, the President said the country’s economic transformation journey remains on track.

Zimbabwe’s export earnings hit the highest levels in history last year, driven by the growth in the manufacturing sector which has seen capacity utilisation increasing to above 60 percent as at December 2021, according to ZimStat.

This is a huge increase when compared to 47 percent in 2020 and about 36 percent in 2019, economic experts have said.

Coupled with fiscal policy support measures and the widening scope for synergies along key value chains, the country has recently seen locally manufactured goods occupying close to 75 percent of shelf space in shops, which buttresses the “Made in Zimbabwe” and “Buy Zimbabwe” initiatives, said President Mnangagwa.

Speaking after concluding a tour of three top manufacturing companies in the Midlands Province – Sino Zimbabwe Cement, Lesaffre Zimbabwe that produces yeast and the giant Bata Shoe Company, President Mnangagwa applauded the great strides made by local businesses in scaling up domestic production with a focus on exports.

The state of the art shoe-making machine which was commissioned by President Mnangagwa at Bata Shoe company in Gweru yesterday

He said the industry revival crusade has been further amplified by the oversubscription of exhibition space by local, regional and international exhibitors during the Zimbabwe International Trade Fair (ZITF), which was successfully hosted in Bulawayo in April.

“This is indicative of the fact that our various investment initiatives are bearing fruit,” said the President while addressing industry executives and thousands of people who came to meet him at the Bata factory grounds.

“It also highlights that our economy has transitioned from stabilisation to growth, with manufacturing sector capacity utilisation having increased.

“The prevailing stable and predictable macro-economic environment continues to encourage investments, production, increased productivity and profitability across the industrial value chain.”

President Mnangagwa said the industrial sector was one of the strategic pillars towards attainment of the Government’s vision of creating a prosperous and empowered upper middle-income society by 2030.

This has to be attained through increasing manufactured value-added products, innovation, exports, gross savings, foreign currency generation and employment creation, among others, he added.

President Mnangagwa commended Sino Cement company and other Chinese investors for investing in Zimbabwe.

In particular, he said Sino Cement, which is the third largest cement producer in the country, was now operating at 90 percent capacity and employing 320 people.

The company has further diversified into high quality face brick and tensile brick production.

Such diversification is benefiting from the boom in the construction industry, which has seen huge investment in roads and housing, among other projects, said the President.

A company official shows President Mnangagwa one of the products made by yeast maker Lesaffre Zimbabwe in Gweru yesterday

He said Lesaffre’s partnership with locals and investment have also resulted in big expansion of the company, which demonstrates growing confidence of French corporations in the operating environment being created by the Second Republic.

The company produces 340 tonnes of yeast per month and is greatly involved in the local agro-processing value chain as it also produces both summer and winter crops and has also ventured into livestock production.

President Mnangagwa said Bata Shoe Company, which has a long history in Zimbabwe, has maintained the lead in the leather sector as it is already implementing the Leather Development Strategy by value adding products and diversification.

During his tour the President officially commissioned the new Polyurethane Pouring Machine, which will be producing a new line of safety shoes and is in line with the expanding economy and soaring demand.

The leather material for the shoes will be sourced locally and strengthens Bata’s participation in the local leather value chain.

“I am delighted to note that all the three companies we have toured today are playing their part in expanding production as well as increasing productivity in line with the aspirations of the Second Republic, “said President Mnangagwa.

He implored local industry to continuously adapt through innovative and adaptive strategies including taking advantage of Innovation Hubs and Industrial Parks at the country’s institutions of higher learning.

As businesses ramp up production, the President urged them to strike a balance between profitability and promoting the welfare of workers and that of surrounding communities through initiatives such as housing and paying decent wages.

He further implored local producers to aggressively take advantage of and claim their share of the market opportunities presented by the African Continental Free Trade Area (AfCFTA), Comesa, Sadc as well as other emerging markets.

On its part, President Mnangagwa said the Government will continue to improve the ease and cost of doing business.

This includes investing in the provision of critical enablers such as energy, water and sanitation, roads and ICT, among others.

He also urged local authorities to play ball in ensuring there is a conducive business operating environment through quality service delivery that matches the growth trends being fostered by the Second Republic.

The same mandate goes to ministries, agencies and state departments that have a role to facilitate improved investment, said the President.

Meanwhile, President Mnangagwa urged the nation to continue to take heed of Covid-19 mitigation protocols saying those who have not been vaccinated must do so and continue to mask-up, sanitise and maintain social distance.

President Mnangagwa accompanied by Minister of Industry and commerce Dr Sekai Nzenza and Sino Zimbabwe company management on a tour of the cement company’s plant in Gweru

In her remarks, Industry and Commerce Minister, Dr Sekai Nzenza, said the Government was supportive of private sector led growth and called for the scaling up of domestication of value chains, which is critical in achieving sustainable economic recovery.

Midlands Provincial Affairs and Devolution Minister Larry Mavima, paid tribute to President Mnangagwa for visiting the province and touring the three companies.

President Mnangagwa assisted by Minister of Industry and Commerce Dr Sekai Nzenza, Midlands Minister of State for Provincial Affairs Cde Larry Mavima and company managers commissions a state-of-the-art machine during a tour of the Bata Shoe Company in Gweru yesterday

He said Midlands was geared to leverage on the available resources to fulfil the ideals of the National Development Strategy, which are anchored on revitalisation of value chains, Decentralisation and Devolution.

Industry and Commerce Deputy Minister Raj Modi, senior government officials, chiefs and industry leaders accompanied the President during the tour.

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