‘Protectionist policies are necessary evil’
THE crafting of protectionist policies such as Statutory Instrument 64 of 2016 is a necessary measure in line with global practice as weak economies seek to nurture their industries in the face of increasing pressure from cheap imports.
This emerged during one of the sessions that were attended by Industry and Commerce Minister, Dr Mike Bimha, at the just ended 21st St Petersburg International Economic Forum in Russia on Thursday.
In an interview Dr Bimha said delegates who attended the high ranking indaba were agreed that Governments were justified in implementing policies that protect their local industries from external shocks.
“After the discussion the conclusion was that at some point in the development process we need to protect the local industry. We need to support the local industry and deliberately come up with policies to support the local industry but at the same time give the impetus for them to grow and also be competitive,” said Dr Bimha.
“Back home we’re seized with the debate on protection of our local industries. There has been criticism from some quarters that when you look at policies such as the Statutory Instrument 64, it’s more of protecting a weak industrial base and not opening up to competition, running the risk of local producers producing goods that are below standard and hold consumers to ransom.”
Statutory Instrument 64 was promulgated last year as local industry buckled under competition from low priced and cheap imports, as a measure to restrict the importation of goods that could be manufactured locally, as well as to promote c o n su mp t i o n of local goods. Government and industry players say the policy has benefited a lot of companies.
Dr Bimha said the country still needed to develop the local industry with focus on meeting the demands of the international markets.
“That in itself will push local producers to up their game on meeting international standards. We need an export oriented localisation. It also forces them to improve on efficiencies so that the cost of production can go down. This was quite a relevant discussion to us,” he said.
Dr Bimha added that during discussions with some companies from Russia, they realised that there was a gap in terms of business information dissemination.
“Some of them were not aware of the level of our development in terms of manufacturing. It’s therefore an opportunity for us to be able to market ourselves and engage the private sector in Russia and provide more information on areas we can create partnerships, which will help us benefit from their technology and experience in their industrialisation.
“What we need to do now is provide as much information as possible so that the private sector in Russia is conversant with the areas where we need partnership. We do have selected areas, which include the development of cotton to clothing strategy, production of hides and skins and leather products, food processing,” he said.
Dr Bimha said the forum was an exploratory mission for countries to find out what they needed to know from each other and supply each other with relevant information for them to make decisions in terms of trade. — @
pamelashumba1.