Foreign firms hit by Zim payment gridlocks
BUYERS representing foreign firms importing goods from Zimbabwe said this week delays in processing payments were among several factors increasing the cost of doing export business.
The buyers, who spoke during an exporters’ seminar in Harare on Wednesday, said it was taking up to 10 days for funds sent by importers to reflect in Zimbabwean banks. The delays have compounded other problems, such as complications in securing export permits, one buyer told the seminar.
They said the government must review requisite policies to build viable exporting businesses in Zimbabwe.
“Payments are taking too long to reflect in Zimbabwe,” said Newton Magoronga, a representative of Zambian firm, Nartbridge. “It is frustrating because right now the standard practice is that within 24 hours if you send money, the money should reflect. But in Zimbabwe sometimes it takes 10 working days for the money to reflect. So imagine, you waited for the export permit and you are now waiting for the payment to reflect in your account. At the end of the day we (Zimbabweans) are losing out because there are other countries who are presenting better (options),” Magoronga added.
He also spoke on challenges faced by exporters with regards to a system run by the Zimbabwe Revenue Authority (Zimra).
“My understanding is that the automated systems for customs data (ASYCUDA) is just the same whether it be in Zambia, Zimbabwe or South Africa,” Magoronga said.“But when you are in Zambia, if you do your export, the maximum is two days and there are time frames laid down. But here we don’t have laid down time frames. You just have to wait and wait. My plea to policy makers is that (they look at those issues),” he added.
In March, Zimbabwe’s trade promotion agency, ZimTrade, said high permit fees charged by the government to floriculture exporters, for instance, were draining fortunes out of farmers annually because markets were shifting to other countries.
ZimTrade revealed that floriculture export permits were 35,7 times more expensive in some cases for Zimbabwe, compared to the region.
High production costs have a bearing on the prices that farmers charge for exports. Across all exports, Zimbabwe is rated among the most expensive in the region.
In the case of floriculture, global markets were trooping to Guatemala, Kenya and Tanzania, according to ZimTrade chief executive officer Allan Majuru, who revealed in March that Zimbabwe was even demanding permits for non-strategic crops. These include bananas, peas, sugar beans, butter, cheese, citrus fruit, coffee, eggs, blueberries, avocado, potatoes, poultry and poultry products and tea.
He said Zimbabwean exporters were paying up to US$1 000 to be granted rights to ship out flowers.
In contrast, the South Africa government charges US$28 for the same permit.
During this week’s seminar, ZimTrade director for operations, Similo Nkala said lobbying was continuing for the government to review policies to improve the ease of doing export business. He also said several domestic firms had expanded footprints across African economies riding on ZimTrade’s market development initiatives.
He added that Zimbabwean firms had clinched deals and inked partnerships running into millions of United States dollars after locating opportunities unlocked by the agency’s efforts to rebuild the country’s export base. “We have conducted market surveys and facilitated local companies to participate in trade fairs and missions in these markets where we identified business opportunities across all sectors of the economy,” Nkala said.
“As a result of our interventions, Zimbabwean companies clinched deals and business partnerships worth millions of dollars with some companies successfully opening branches in different African markets,” Nkala told the seminar.
Several firms have this year participated in market development programmes in Germany, Italy, the United Kingdom (UK), Zambia, Malawi and the Democratic Republic of Congo (DRC). ZimTrade says it will take its export development programme to Ghana, making it the springboard into the rest of West African markets. He said global supply chains were recovering following two years of Covid-19 inspired gridlocks, and companies must be disruptive and innovative.
The seminar, which ran under the theme: ‘Inclusive. Diversified. Connected” comprised buyers from Ghana, Mozambique, Malawi and Zambia.