In­dus­try ca­pac­ity util­i­sa­tion clocks 47.4%

Chronicle (Zimbabwe) - - Business - Oliver Kazunga Se­nior Busi­ness Reporter

CA­PAC­ITY util­i­sa­tion in the man­u­fac­tur­ing sec­tor jumped by 13.1 per­cent to 47,4 per­cent this year largely driven by the mea­sures the Gov­ern­ment has taken to pro­tect lo­cal in­dus­try.

Economic ob­servers view this as a sig­nif­i­cant in­crease to­wards re­vi­tal­is­ing the man­u­fac­tur­ing sec­tor when com­pared to the 2015 ca­pac­ity util­i­sa­tion record of 34,3 per­cent.

“Ca­pac­ity util­i­sa­tion has jumped sig­nif­i­cantly by 13.1 per­cent­age points from 34.3 per­cent in 2015 to 47.4 per­cent in 2016,” the Con­fed­er­a­tion of Zim­babwe In­dus­tries (CZI) said in its man­u­fac­tur­ing sec­tor sur­vey re­port re­leased on Wed­nes­day.

“This is a very pos­i­tive de­vel­op­ment largely re­sult­ing from the moves on the part of Gov­ern­ment to pro­tect lo­cal in­dus­try and the im­port pri­or­ity list.”

Among the raft of mea­sures, the Gov­ern­ment in June pro­mul­gated Statu­tory In­stru­ment 64 of 2016 to con­trol im­ports.

SI64/2016 re­moves sev­eral goods from the Open Gen­eral Im­port Li­cence. In­dus­try and Com­merce Min­is­ter Dr Mike Bimha has said prod­ucts listed un­der SI64/2016 would only be im­ported for com­mer­cial pur­poses in sit­u­a­tions where lo­cal in­dus­tries fail to meet national de­mand.

Some of the listed prod­ucts are cof­fee cream­ers, build­ing and hard­ware ma­te­ri­als, dairy prod­ucts, bot­tled wa­ter and fur­ni­ture items.

CZI high­lighted in the re­port that only 20,7 per­cent of re­spon­dents viewed SI 64 as pos­i­tive. “This seems to in­di­cate that the over­rid­ing con­cern of in­dus­tri­al­ists is the un­cer­tain macro-economic en­vi­ron­ment.

“This con­clu­sion is sup­ported by the fact that 77,1 per­cent of re­spon­dents rated pol­icy in­sta­bil­ity as neg­a­tive or very neg­a­tive for the econ­omy,” it said.

“In ad­di­tion 73 per­cent feel that the Gov­ern­ment and/or Busi­ness Mem­ber­ship Or­gan­i­sa­tions (BMOs) are not im­prov­ing in pri­vate- pub­lic di­a­logue con­sul­ta­tion with the pri­vate sec­tor to ad­dress economic chal­lenges.

“Sixty per­cent of the re­spon­dents do not know of any pub­lic-pri­vate di­a­logues or con­sul­ta­tions con­ducted by Gov­ern­ment or BMOs in the past 24 months to ad­dress economic chal­lenges.”

How­ever, CZI said it was im­per­a­tive for the Gov­ern­ment and the pri­vate sec­tor to ac­cel­er­ate ex­ist­ing ini­tia­tives for broad based macro-economic sta­bil­i­sa­tion.

Cor­rup­tion, pol­icy in­sta­bil­ity, ac­cess to finance, com­pe­ti­tion from im­ports and low de­mand for do­mes­tic prod­ucts, were cited in the re­port as ma­jor im­ped­i­ments af­fect­ing busi­ness.

Since the in­tro­duc­tion of the mul­ti­c­ur­rency sys­tem in Fe­bru­ary 2009, the Gov­ern­ment and the pri­vate sec­tor have tar­geted to in­crease ca­pac­ity util­i­sa­tion to com­pet­i­tive lev­els.

Ex­perts have stressed the need for Zim­babwe to im­prove its do­mes­tic pro­duc­tion to meet mar­ket de­mands and for ex­port. — @ okazunga

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