Lockdown discord costs business
A serious policy discord in government and police is negatively impacting business as businesses are struggling to access exemption documents while workers are blocked from reporting for duty or delayed by several hours by the police.
There is confusion over the implementation of the new Covid-19 national lockdown measures particularly around exemption procedures and documentation for businesses and workers.
Thousands of workers were turned away from police roadblocks this week while companies were battling to access exemption documents as the government is demanding tax clearance certificates, motivational letters and standard development levy receipts.
Vice-President Constantino Chiwenga announced the new regulations which came into effect this week where only essential services such as hospitals, pharmacies and supermarkets are allowed to open from 8am to 3pm for 30 days. There is a curfew from 6pm to 6am.
The lockdown is hitting hard informal traders who rely on daily buying and selling to make ends meet. Due to low levels of formal employment, the majority Zimbabweans have turned to street vending to earn a living.
Confederation of Zimbabwe Industries (CZI) vice-president Joseph Gunda said business was losing time due to the national lockdown policy inconsistencies.
Gunda said lockdown impacts negatively on industry as some companies sit on raw materials for prolonged periods.
“Lockdown is a problem for industry because in most cases it’s unplanned for. It’s induced by the Covid-19 pandemic. We were struggling with many challenges before the lockdown and this means that the situation for industry is worsening,” Gunda said.
He said the CZI has been engaging the Industry and Commerce ministry to expedite the issuing of exemption documents but in vain.
“We have had to talk to the ministry on the way forward. Officially we were of the impression that we would use old letters to get clearance for our workers but the police are also saying no,” Gunda said. “Now we hear there are fresh requirements from the ministry; they want a motivational letter from the individual company. They also want a tax clearance certificate and a standard development levy receipt that shows compliance. These are all fresh requirements.”
Repeated efforts to get a comment from Industry and Commerce minister Sekai Nzenza and acting permanent secretary Wilson Kaerezi were fruitless. Kaerezi demanded questions in writing but did not respond by the time of going to print.
Companies, Gunda said, were feeling the effects of the lockdown restrictions.
“At the end of the day we must be aware that we are an economy that must continue to thrive. Other economies are thriving and we need to move on. We must strike a balance between critical economic activity and health requirements that keep the nation afloat,” he said. “It’s necessary to lockdown because we have to protect life. However, we must be aware that there is life after the pandemic. Where will we be if we don’t consider the critical economic activity? Industry is affected by the lockdown and a quick response is needed to pave way for critical players to operate.”
Gunda recommended that industry should be given a week to put its house in order to align with the new regulations.
“We have been hit by Covid-19 since
March. We were hoping that by now things would have improved. Industry will be left bleeding,” he said.
Markets analyst Batanai Matsika said the lockdown was destroying the already struggling industry whose capacity utilisation remained below 50%.
“A local currency should be supported by fundamentals and one of the fundamentals has to do with production as measured by Gross Domestic Product (GDP). The lockdown presents a risk from a growth perspective because there is a risk for a recession in 2021,” Matsika said.
He said Covid-19 remained problematic, hence policy makers should craft strategies to boost the economy in 2021.