News / National
CZI, ZNCC back imports ban
30 Jun 2016 at 08:50hrs | Views
THE Zimbabwe National Chamber of Commerce (ZNCC) and Confederation of Zimbabwe Industries (CZI) have backed the government's decision to restrict importation of products that are available locally, saying the move would stimulate the economy.
ZNCC president Mr Davison Norupiri told delegates who are attending the three-day business indaba here that Statutory Instrument 64 of 2016, which removes several products from the Open General Import Licence, was a noble intervention.
"Zimbabwe is a small country in a dangerous and competitive world. We're a niche player in the global market. As ZNCC we believe S.I. 64 of 2016 will stimulate the economy by removing certain products from the general import category," said Mr Norupiri.
Among the affected products are hardware and electrical products such as locks, doors, window frames, furniture, foodstuffs such cremora, coffee creamers, camphor creams, white petroleum jellies, body creams, plastics pipes and fitting, bottled water, mayonnaise, salad creams, peanut butter, jams and mahewu.
He said while some people opposed the initiative, the business community was happy as this was part of efforts to protect local industry and create more job opportunities in the country.
"This policy measure is fully supported by ZNCC and its members as long as it's periodically monitored. In fact, this was a suggestion from the business community to assist in domestic capacity utilisation, promote local consumption and instill investor appetite," he said.
Mr Norupiri said the import restriction approach has worked positively in the cooking oil industry with players in the sub-sector operating at almost 100 percent while some foreign players in the same line of business were setting up shop in Zimbabwe.
He said restricting imports was also going to assist in reducing the import bill, which is currently sitting at around $3 billion per year against imports of up to $6 billion.
Addressing journalists at a Press conference in Bulawayo yesterday, CZI president Mr Busisa Moyo said support for local industry has always been critical to the emergence of the economy that is characterised by the high cost environment.
"While we're incubating and nurturing our industry, support for local industry will be important. The support is based on the fact that the Zimbabwe economy is not yet in equilibrium; things are not yet in balance, we've a high cost environment. The environment is saddled with high costs that businesses incur," he said.
He said the research that has been done by the Zimbabwe Economic Policy Research Unit (Zeparu) has proved that the country's internal costs and cost of living is higher compared to regional countries.
"There is a cost driver study that was done in 2014 by Zeparu and the study showed that Zimbabwe's internal costs and cost of living is 45 to 55 percent higher than its regional peers. So, we have a high cost environment that businesses are operating in.
"This is what necessitates support for industry because for as long as you acknowledge that you have high cost environment created through various things like government legislation, taxes, charges and so on, you can't then assess industry and say industry isn't competitive."
Mr Moyo said the first thing to do is to correct the cost environment before making an assessment on industry competitiveness.
"So, one must understand that we have a challenge. The challenge is not just to do with the cost for business but it also has to do with the cost of living.
"The cost of living in Zimbabwe is very high. These costs include things like fuel charges.
''These are some of the inefficiencies that we have and the manufacturing sector is incurring that high cost upfront," he said.
CZI, he said, has always advocated for the removal of high cost environment through measures such as internal devaluation.
"Dealing with high cost environment will not only allow us to drop import duties and allow people to import; we will compete fairly on the market and we can't at the moment because of high costs.
''The source of high costs are several for example, sanctions is one reason.
"Sanctions do affect the private sector in Zimbabwe and we aren't ashamed to highlight this.
''Lack of policy consensus around reforms, lack of balance of payments support, weakening of regional currencies, and falling commodity prices are some of the reasons for high cost environment.''
Mr Norupiri was critical of the financial services sector, which he accused of failing to support economic turnaround efforts.
"We need to first address the financial services sector so that it moves the money to where it's needed.
''The business need to have confidence in the financial services and this isn't happening in Zimbabwe.
"We need long term capital and without it businesses are forced to collapse and no wonder Zimbabwe lags behind because finance is the greatest handicap," he said.
Mr Norupiri applauded the on-going ease of doing business reforms being spearheaded by the government saying this was a critical process that would boost competitiveness of the country's products in the global market.
ZNCC president Mr Davison Norupiri told delegates who are attending the three-day business indaba here that Statutory Instrument 64 of 2016, which removes several products from the Open General Import Licence, was a noble intervention.
"Zimbabwe is a small country in a dangerous and competitive world. We're a niche player in the global market. As ZNCC we believe S.I. 64 of 2016 will stimulate the economy by removing certain products from the general import category," said Mr Norupiri.
Among the affected products are hardware and electrical products such as locks, doors, window frames, furniture, foodstuffs such cremora, coffee creamers, camphor creams, white petroleum jellies, body creams, plastics pipes and fitting, bottled water, mayonnaise, salad creams, peanut butter, jams and mahewu.
He said while some people opposed the initiative, the business community was happy as this was part of efforts to protect local industry and create more job opportunities in the country.
"This policy measure is fully supported by ZNCC and its members as long as it's periodically monitored. In fact, this was a suggestion from the business community to assist in domestic capacity utilisation, promote local consumption and instill investor appetite," he said.
Mr Norupiri said the import restriction approach has worked positively in the cooking oil industry with players in the sub-sector operating at almost 100 percent while some foreign players in the same line of business were setting up shop in Zimbabwe.
He said restricting imports was also going to assist in reducing the import bill, which is currently sitting at around $3 billion per year against imports of up to $6 billion.
Addressing journalists at a Press conference in Bulawayo yesterday, CZI president Mr Busisa Moyo said support for local industry has always been critical to the emergence of the economy that is characterised by the high cost environment.
"While we're incubating and nurturing our industry, support for local industry will be important. The support is based on the fact that the Zimbabwe economy is not yet in equilibrium; things are not yet in balance, we've a high cost environment. The environment is saddled with high costs that businesses incur," he said.
He said the research that has been done by the Zimbabwe Economic Policy Research Unit (Zeparu) has proved that the country's internal costs and cost of living is higher compared to regional countries.
"There is a cost driver study that was done in 2014 by Zeparu and the study showed that Zimbabwe's internal costs and cost of living is 45 to 55 percent higher than its regional peers. So, we have a high cost environment that businesses are operating in.
"This is what necessitates support for industry because for as long as you acknowledge that you have high cost environment created through various things like government legislation, taxes, charges and so on, you can't then assess industry and say industry isn't competitive."
Mr Moyo said the first thing to do is to correct the cost environment before making an assessment on industry competitiveness.
"So, one must understand that we have a challenge. The challenge is not just to do with the cost for business but it also has to do with the cost of living.
"The cost of living in Zimbabwe is very high. These costs include things like fuel charges.
''These are some of the inefficiencies that we have and the manufacturing sector is incurring that high cost upfront," he said.
CZI, he said, has always advocated for the removal of high cost environment through measures such as internal devaluation.
"Dealing with high cost environment will not only allow us to drop import duties and allow people to import; we will compete fairly on the market and we can't at the moment because of high costs.
''The source of high costs are several for example, sanctions is one reason.
"Sanctions do affect the private sector in Zimbabwe and we aren't ashamed to highlight this.
''Lack of policy consensus around reforms, lack of balance of payments support, weakening of regional currencies, and falling commodity prices are some of the reasons for high cost environment.''
Mr Norupiri was critical of the financial services sector, which he accused of failing to support economic turnaround efforts.
"We need to first address the financial services sector so that it moves the money to where it's needed.
''The business need to have confidence in the financial services and this isn't happening in Zimbabwe.
"We need long term capital and without it businesses are forced to collapse and no wonder Zimbabwe lags behind because finance is the greatest handicap," he said.
Mr Norupiri applauded the on-going ease of doing business reforms being spearheaded by the government saying this was a critical process that would boost competitiveness of the country's products in the global market.
Source - chronicle
