ZimTrade predicts exports growth
TRADE development and promotion agency, ZimTrade, says Zimbabwe’s exports will continue on the growth trajectory experienced throughout this year until December. The growth has been underpinned by reforms towards developing and promoting relations that facilitate export growth.
“Zimbabwe’s exports over the past few months have been on an upward trend and are expected to continue growing throughout the year,” ZimTrade said.
Cumulative export receipts increased to US$2,31 billion during the first half of 2021, compared to US$1,91 billion during the comparable period in 2020.
This represents a 20,8% growth in 2021, although trade was last year affected by Covid-19 induced hard lockdowns.
The agency said Zimbabwe has been enjoying positive spinoffs from the economic diplomacy strategy being pursued by the Ministry of Foreign Affairs and International Trade.
Through the national export strategy, ZimTrade has been holding export promotion programmes.
“These missions have seen Zimbabwean exporters establish strong links with potential buyers in the Democratic Republic of Congo and are expected to start trading as soon they conclude negotiations.
“There are several activities that the government is implementing through different ministries and agencies to enhance the ease of doing business, which is expected to reduce the cost of doing business and improve revenues,” ZimTrade said.
“Whilst these programmes and activities will undoubtedly contribute towards export growth, it is important for exporters to understand the costing of their products as well as payment terms which will ensure the success matrix of their products.
“This is because buyers that have expressed interest to source from Zimbabwe often note that local companies must meet a competitive price and come up with good payment terms.
“There are external and internal factors that affect pricing, and these must be considered by the exporter on the final product.”
ZimTrade added that exporters must take advantage of incentives that have been put in place to reduce the cost of the final product.
“Local exporters must register to trade under bilateral and multilateral trade agreements that Zimbabwe is signatory to,” the body said.
“These agreements are designed to stimulate and encourage trade between the countries or groups of countries who sign the agreement, by giving one another preferential treatment in the reduction or elimination of customs duties as well as removal or relaxation of quantitative restrictions.
“A reduction or elimination of the duty can give the exporter a substantial advantage over competitors from countries that do not have similar trade agreements.
“It is important to acknowledge that pricing is one of the most important decisions, which is faced by the exporter.
“Foreign markets are highly competitive and prices for each product should be worked out in relation to conditions prevailing in each market.”
The organisation said negotiating sustainable payment terms is another critical factor that determines a successful exporting business.
It said exporters must consult their banks on the best method of handling each transaction.
Factors influencing the method of payment include the type of transaction, nature of merchandise, amount involved, credit standing of the importer, political or economic conditions in the importing country, exporter’s financial position, and acceptable trade practices.