‘Why are we importing paper?’

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THERE is a saying: ‘Necessity is the mother of invention’.
When one is hungry, one gets innovative in trying to find food to fill his/her stomach.
Zimbabwe is currently a country in need.
This has not been our first ride on this train of economic woes that has become all too familiar to us.
While fingers can be pointed to different reasons the economy has deteriorated to such levels, there is one factor that always seems to be ignored: The nation heavily relies on imports.
Much like aid, importing basic commodities hinders self-sufficiency (independence).
It causes nations to need foreign currency to buy the imported goods and increases Government spending, thus lowering the national revenue.
Importing is often costly in purchasing, transporting and paying duty for the product.
This leads to prices being generally high and hard to subsidise.
Imports cause brain drain, not in the manner of emigration, but a nation not being able to produce basic goods like cooking oil, milk, paper, diesel and so on.
Many say it is the failure of the Bond note to remain at par with the US dollar and the increase in taxes for electronic transfers above $10 that is responsible for this whole mess.
But that is not seeing the bigger picture and barely scratching the surface.
The above stated was simply the last straw that broke the camel’s back.
The problem has always been that of relying on imports.
With the fall of the Bond note’s value came the exclusive need for US dollars in order for one to import foreign goods.
This is the main cause for shortages.
There is also the issue of politically motivated sabotage.
In 2008, a similar situation arose in the country, with people failing to acquire basic commodities and the prices rising.
This shows that changes in regulation, and so on, are not the villains people make them out to be.
In fact, many are beginning to forget that before the Minister of Finance and the central bank governor made the decision to charge two percent for every $1 above $10 sent over the phone or bank card, the Bond note was already being undervalued on the street and rated below the US dollar.
EcoCash outlets were cashing out at as high as 30 percent at times, meaning one had to pay $3 just to receive $10.
These developments forced the financial sector leaders to act and unfortunately their regulations only made the already bad situation more apparent and worse.
While their regulations were ideally aimed at the black market money traders, they affect the whole populace and end up taxing innocent citizens.
If the Government had the capacity to identify the phone numbers and bank accounts of money dealers, these regulations would have achieved the desired result but, sadly, this is not the case.
Back in 2016, there was already speculation that fuel and all imported goods would become scarce if the integrity of the dollarisation programme did not stand — the parity of the Bond note to US dollar.
To economists, such is neither speculation nor prophecy but a firm grasp of the obvious.
If the nation was not reliant on imports of basic goods, but producing them, these risks would not have been immanent.
The success or failure of producing the goods would be determined by the agricultural output each season rather than the availability of forex in a nation.
Producing for ourselves would also mean becoming potential exporters and would bring in forex on top of brain gain.
The rules pertaining to supply and demand, investment and profit, among other factors, are only applicable in a normal economy which lives on its produce.
Zimbabwe is becoming much like many European nations that rely on imports yet we have the capacity to feed ourselves and other nations, as has been the case in the past.
What is worse is that Zimbabweans want their investment to pay off double or triple returns overnight.
Whilst in Europe, a trader would set a three percent mark-up in order to earn profit from a product sale, and even less if the product has high turnover (sells fast), in Zimbabwe, a trader sells a product he ordered for $1 at $3.
That is three times the cost price and such has become the norm in Zimbabwe, to the detriment of the general population.
Even in this dire state, we find retail and wholesale stores capitalising on the price hikes and shortages of basic commodities in what has become typical Zimbabwean fashion.
The problem began as follows: Black market traders and panic buyers began emptying up the shelves by hoarding and over buying.
Stocks remained with prices unchanged at wholesale levels. Stores then began withholding supplies to avoid aiding the parallel market players.
They then began to set conditions under which customers could procure targeted goods like cooking oil, sugar, drinks and so on. These involved each consumer being permitted to buy one item of the goods in question at a time.
Some retailers began setting a mark of $10, meaning only if one bought goods worth $10 could one become eligible to buy one item of the scarce cooking oil, sugar and so on.
The mark has since risen to $15 in some stores.
This again hurts the general populace who find it hard to raise such high amounts of money.
While this situation seems bad, it is actually good for Zimbabweans to know what products they ought to learn to produce for themselves so as to avoid future shortages.
In 2008, one could find entrepreneurship returning as common people began producing pies, chips, bread and so on because they could no longer be procured in stores.
Such is the formula to tackle such problems, and not merely seeking forex to import the goods needed.
Zimbabwe imports paper, a product invented by the Chinese thousands of years ago, yet we are not making our own in 2018.
Materials like hemp can be planted along with other crops of strategic importance.
Hemp alone can facilitate the raw materials for making paper, textiles, ethanol, diesel, lactose free milk, cooking oil and protein powder, just to name a few.
Technical support and technology are the only things that intelligent, hardworking and resource-rich people like Zimbabweans need to import, not final products like milk and cooking oil that we can undoubtedly produce for ourselves.
The advent and success of the Command Agriculture Programme shows that Zimbabwean landowners and farmers are willing to co-operate with the Government in healing the economy and feeding the nation.
Thus, it is a Government initiative which ought to spearhead the indigenisation of the manufacturing sector, setting up of processing plants and limiting imports.
In places like China, high duty is set on imports to discourage dependency and promote self-sufficiency.
It is this approach that will give us a quantifiable way out of our current economic problems and lead us to stability and self-sustainability.

1 COMMENT

  1. Thought the article was about why we are importing paper. could have been better if you had investigated only that one aspect and asked those in the paper inductry why they are choosing to import paper insted of making it locally. touching on too many inductries and products looks like you did not do your reseach well. just investigate throughly why we still find ourselves importing paper, leave other products for another day bro. the article is too general and is not so factual. get the facts from the ground. talk to those who are in the industry. look at the market and ask them. what is causing us to import. don’t do desk reseach, go out on the ground bro.

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