Industry primes sectors for local content
works for Zimbabweans.
“The Zimbabwe local content regulation should cover the following sectors such as mining, manufacturing, public sector, parastatals, retail, energy, transport, motor trade and assembly, construction, services, health, tourism and all sectors serving schools,” said Mr Jabangwe.
“The local content Act should allow the Minister of Industry and Trade to set thresholds of minimum local content relating to the sectors above as and when it’s necessary. These thresholds can be set in the form of regulations.”
It is envisaged that the new law will give Government the ability to flexibly adjust the thresholds in line with the developmental and industrialisation agenda of the country.
CZI believes that a minimum threshold of local content will increase demand for local supplies.
As part of the thrust to make the new policy applicable to both central and local Government, industry is also pushing for all tender documents including those of Stateowned enterprises to “indicate levels of minimum content to be part of goods to be procured locals as per LCR”.
However, in order to prevent bureaucratic red tape, Government will be able to make some of the policy adjustments without necessarily issuing a SI.
Experts consider the regulations also regarded as “smart” protectionist measures, as part of the country’s broader industrialisation initiative.
Zimbabwe National Chamber of Commerce Economist Mr Dumisani Sibanda said industry is optimistic that the regulations will “promote inclusive and sustainable industrialisation, and foster innovation”.
“The policy will develop and support local manufacturing and service provision through backward, forward and sideways linkages along the value chain.
“It will go a long way in promoting sustained, inclusive and sustainable economic growth and this will also help build resilient infrastructure, promote inclusive and sustainable industrialisation and foster innovation.”
Industry also hopes that a framework that deliberately promotes local production and consumption will help forge joint ventures and partnerships between foreign firms and locals.
Indonesia, for example, stipulates that smartphones sold within its territory should have 30 percent of local components.
According to the World Bank (2012), Norway used LCR to improve its state of industry to a level where domestic supply was 50 to 60 percent of capital inputs, 80 percent of operational inputs and 46 percent of exports.