Companies cut working hours
COMPANIES in Bulawayo have resorted to reduced working hours due to a shortage of raw materials as foreign currency shortages continue to take their toll, the Confederation of Zimbabwe Industries (CZI) has said.
In an interview, CZI Matabeleland Chamber president Mr Joseph Gunda said a number of companies such as General Beltings, Shepco Industries and Zimplow have started sending their workers home because of depressed productivity caused by foreign currency constraints.
“We are in a tight spot as forex shortages hit industries harder. Generally for most of us, it has been almost three weeks with no allocations and most of the industries rely on the importation of raw materials and without allocations the situation is getting worse,” he said.
“We are appealing to the Reserve Bank of Zimbabwe to prioritise allocating the mining equipment manufacturers and suppliers.”
Mr Gunda said the mining industry was Zimbabwe’s key driver of the economy and its subdued functional performance has a negative ripple effects to the overall macro-economic stability. The mining sector is this year expected to contribute more than 70 percent of Zimbabwe’s foreign currency earnings from 2017’s contribution of 70 percent. The sector also contributes 13 percent to the Gross Domestic Product.
“For example, in our case as General Beltings and companies such as Shepco Industries, we are key suppliers to the mining sector and if we don’t supply conveyor belts and other equipment to the mining sector, we’re affecting the mining industry big time,” said Mr Gunda.
He noted that if mining companies rely more on imported accessories and equipment, that would increase Zimbabwe’s import bill and further exacerbate economic challenges.
Since 2009, the country has been struggling to tame the negative trade balance as Zimbabwe’s entire manufacturing sector was operating at uncompetitive levels driven by a host of operational challenges.
In 2017, Zimbabwe’s trade deficit tumbled by 25 percent to $1,5 billion and this year the Government has set sights on trimming it further to less than $1 billion. — @okazunga