Bulawayo needs at least US$50 million capital injection: Lupepe

Bulawayo-based businessman Mr Delma Lupepe said the US$50 million should be at least enough to get industry re-opening but a further US$50 million would be required to ensure that industry is fully operational.

He added that the challenge affecting players in the clothing and textile industry in particular is that indigenous banks are "finishing off industry by charging interest rates of between 80 percent to 97 percent on the US dollar denomination". He also cited the Chinese competition as a challenge,  "the equipment we use produces four nappies in five minutes when our competitors in the region and China are producing between 50 to 100 nappies or more in five minutes".

Mr Lupepe said there hasn't been recapitalisation of equipment in industry in the last 20 years after independence and the 10-year economic decline has made it difficult to recapitalise. Industry is in need of financing to recapitalise urgently and be competitive.

He said, once industry acquires new and modern machinery, this will improve efficiency, the quality of products, and increase volumes. It is business sense that if you are producing larger volumes, naturally you lower your production costs and your prices become competitive.

He allege that indigenous banks seem to be wanting to help them, but they are putting the last nail on the coffin of industry. They are making a killing out of the difficulties that industry is facing.

He added that long-term finance has never trickled down to Bulawayo.

"We read in the Press that Afreximbank in conjunction with the Ministry of Finance availed funding for industry. Then we read again in the Press comments by Finance Minister Tendai Biti that the Zimbabwe Economic and Trade Revival Facility set up in 2010 to help companies in distress is now fully operational but there has been a slow uptake of the money and to date less than US$10 million has been disbursed.

"Bulawayo, which was the hub of industry, is not even aware as to where and how to apply for that funding. There is no information as to who has even received that funding and which industries it has gone to.

"This is no small matter. Would industries collapse if such a fund were accessible and available? Surely if that money is not trickling down to Bulawayo and revive industry, that money is building a new industrial hub elsewhere," explained Mr Lupepe.

He urged politicians to speak with one voice on the issue of Matabeleland.

"If they start accusing each other and pointing fingers at each other, it does not help the people of Bulawayo. This is not the time to politick on people's misery.

"For example, Cotton Printers has collapsed. At its peak it produced 1,5 million metres of fabric a month. It employed over 1 200 people who were both skilled and semi-skilled.

"Companies like National Blankets, Toppers Uniforms, just to name a few, were big employers. Today more than 10 big employers in Bulawayo who employed more than a 1 000 people have closed.

"This effectively means that more than 10 000 people in an industrial hub like Bulawayo are jobless, and that is a crisis.

"Politicians must surely be moved by such figures. As industry and business leaders we even approached some of the politicians that are now politicking on the challenges affecting the economic livelihood of

Bulawayo and they did not even do anything about it and left industry to collapse.

"I do not care who said what but at the end of the day there is urgent need to secure long-term finance for industry in Bulawayo and assist industry to acquire new machinery and employ people again."

Minister of Industry and Commerce Professor Welshman Ncube said 85 companies in Bulawayo have since closed shop, adding that the real issue is that of finance.

"Problems faced by industry in Bulawayo is that of lack of access to affordable and long-term finance.

If we solve the issue of long-term finance, we would have solved more than 50 percent of the problems faced by industry in Bulawayo and the country as a whole."