HomeOld_PostsZim economic prospects bright: CZI

Zim economic prospects bright: CZI

Published on

ZIMBABWE’s economy is transforming for the better and industry is optimistic that 2017 will usher in a new dispensation that will result in the recovery of the economy.
The Confederation of Zimbabwe Industries (CZI) said 2017 will see the results of several economic reforms undertaken by Government in its quest to resuscitate the productive sectors.
It noted steps taken to ease the business operating environment through the Ease of Doing Business reforms, the finalisation of the Special Economic Zones Bill and passing into law as well as revision of the Indigenisation law by the President as likely to catapult investment interest.
The promulgation of the special economic zones marked a new era on the investment arena that is expected to see the country receiving improved investment inflows beginning this year.
Government is targeting a foreign direct investment level of 25 percent of the country’s gross domestic production starting this year.
Presenting the National Budget last year, Finance and Economic Development Minister Patrick Chinamasa envisioned the economy growing by 1,7 percent buoyed by agriculture and mining.
“In 2017, the economy is set to turn around from the slowdown mode to modest growth led by key sectors of mining and agriculture, benefitting from the anticipated normal to above normal rainfall,” said Chinamasa.
“Overall GDP growth is, therefore, projected at a moderate 1,7 percent in 2017, also against the background of anticipated moderate improvements in international commodity prices, fruition of planned mining investments and benefits from the Ease of Doing Business reforms.”
CZI president, Busisa Moyo opines the current growth projections are not likely to be missed this time around as the country’s primary sectors of agriculture and mining look set for major gains, thanks to the good rains and improving commodity prices on the international market.
Already, positives have been noted in the agriculture sector since the introduction of Command Agriculture last year, with large tracts of land that had become accustomed to idleness being utilised and the crops in good state.
Agriculture is projected to grow by 12 percent driven by higher output from major crops such as maize, cotton and tobacco, as well as milk production.
Command farming was introduced by the Government to increase agricultural production and improve food security in Zimbabwe.
The programme is targeting 400 000 hectares of maize production that will see two million tonnes of maize harvested.
A number of companies that had hit capacity utilisation of one percent bounced back to greater production.
Moyo said even though 2016 was tough for business, they managed to get a reprieve from Government through Statutory Instrument (SI) 64 which helped local industry increase capacity.
He said measures introduced by Government to protect local industries had started bearing fruits as several companies increased production and employment while new companies managed to set up factories in Zimbabwe this year.
These include Willowton, Zim Kings, Golden Glow, Arenel and PespiCo, just to name a few new entrants in response to localisation of industrial capacity in line with the general Southern African Development Community (SADC) industrialisation agenda.
“2016 had been fairly good for manufacturing in terms of bringing value addition into the spotlight and the importance of supplying local demand using local means of production,” said Moyo.
The measures introduced under SI 64 of 2016 removed 40 products from the Open General Import Licence with the aim to give local industry market space, especially the manufacturing sector, to shield it from unfair competition from cheap imports.
According to CZI, capacity utilisation in the manufacturing sector grew by between 30 and 50 percentage points driven by the restriction on imports.
Before the restrictions, capacity utilisation was below 30 percent.
Some of the notable improvements include the Tregers Group, which increased employment from 2 006 to 2 172, while production capacities rose from 35 percent to 45 percent, with the plastic division currently operating at 80 percent.
Datlabs reported a 60 percent increase in sales and KDV, a manufacturer of mattresses, increased capacity to 85 percent.
Gains were also recorded in the retail sector were a US$32 590 000 investment was realised.
Moyo encouraged good working ethics between Government and the private sector, noting if these two work together, the 1,7 percent projected growth can actually be surpassed.
However, he said Government should put more focus on getting foreign exchange from tourism, considered a low hanging fruit, to help the economy grow.
“Tourism could be a fast generator of foreign currency if correct measures are taken to make the country an attractive destination,” said Moyo.
“We have the heritage sites.”
On paper, tourism has surpassed gold and tobacco to be the main source of foreign currency although the country remains the most expensive destination in the SADC region.
This is despite the country recording a 16 percent increase in tourist arrivals to 450 572 in the first quarter of 2016 from 387 557 in the comparable period 2015, according to a report by the Zimbabwe Tourism Authority (ZTA).
A poll done on tourists by the Zimbabwe Council of Tourism (ZCT) last year found that each tourist was budgeting an average of US$1 900 per stay, meaning tourists from the first quarter spent an estimated US$856 million.
However, due to the high local costs, analysts say tourists spend most of their money in neighbouring countries.

LEAVE A REPLY

Please enter your comment!
Please enter your name here

Latest articles

Kariba Municipality commits to President’s service delivery blueprint

By Kundai Marunya IT is rare to find opposition-controlled urban councils throwing their weight on...

The resurgence of Theileriosis in 2024 

THE issues of global changes, climate change and tick-borne diseases cannot be ignored, given...

Britain haunted by its hostile policy on Zimbabwe

TWO critical lessons drawn from the recent debate on Zimbabwe in the British House...

The contentious issue of race

 By Nthungo YaAfrika AS much as Africans would want to have closure to many of...

More like this

Kariba Municipality commits to President’s service delivery blueprint

By Kundai Marunya IT is rare to find opposition-controlled urban councils throwing their weight on...

The resurgence of Theileriosis in 2024 

THE issues of global changes, climate change and tick-borne diseases cannot be ignored, given...

Britain haunted by its hostile policy on Zimbabwe

TWO critical lessons drawn from the recent debate on Zimbabwe in the British House...

Discover more from Celebrating Being Zimbabwean

Subscribe now to keep reading and get access to the full archive.

Continue reading