Bulawayo business community remains hopeful

THE Bulawayo business community says it remains hopeful for a turnaround this year, despite severe operational challenges experienced in 2014.

Bulawayo businessman, Tshidzanani Malaba, said he hoped business would improve in the New Year, and that the country would receive favourable rainfall to mitigate the impact of imports. "I think by the end of 2015, there will be better signs than 2014 although that may not translate into survival of all businesses," said Malaba.

He said the year 2015 would lay the foundation for a better future on the back of normalisation of relations with the European Union. A tax amnesty granted to the business sector by the Zimbabwe Revenue Authority (ZIMRA) would also mitigate the prospect of company closures through suspension of garnishees and tax penalties, he said.

The tax amnesty, which became effective on October 1, 2014, will expire on March 31, 2015. It will grant amnesty in respect of non-compliance which occurred during the period beginning February 1, 2009 and September 30, 2014, during which period tax payers with outstanding obligations can voluntarily inform ZIMRA about their positions.

The amnesty will give tax payers who acknowledge their tax obligations or irregularities amnesty on penalties, interest and prosecution for non-payment and other irregularities in connection with all taxes administered by ZIMRA. Malaba said businesses were not just relaxed and waiting for a miracle but were busy working on turnaround strategies.

"Businesses have since realised that the rebound of the economy lies in their hands," he said.

He said government, as an economic enabler, had to create a conducive environment for businesses to prosper. Malaba said while old companies could struggle during the year owing to undercapitalisation and antiquated equipment, new, emerging businesses were likely to flourish.

Association of Businesses in Zimbabwe chief executive officer, Lucky Mlilo, said with government having already instructed all fuel dealers to slash prices, they were positive the year would begin on a high note, arguing transport costs were a big factor in business. He was optimistic that the Reserve Bank of the Zimbabwe would be able to play the lender of last resort function, something he said was likely to ease the tight lending conditions.

"The lending that has been there has been on short term and very expensive since dollarisation. We are also appealing to government to make the atmosphere conducive to FDIs (foreign direct investment)."

He said it was important that government prioritised the recapitalisation of economic enablers such as the National Railways of Zimbabwe, Zimbabwe Electricity Supply Authority and Hwange Colliery Company for the economy to help turnaround the economy.

"As business associations we are also active; we engage with potential investors outside and we have a number of business luncheons lined-up for this year," said Mlilo.

He said the economy would one day rebound, but that called for hard work.

"To be frank with you, to be where we are, it took years and revival will not be overnight," he added. Asked if companies that closed for the annual shut down would reopen against the backdrop of rumours many may close, Mlilo said it was difficult to tell.

Zimbabwe National Chamber of Commerce, Bulawayo Chapter vice chairperson, Sisa Sibanda, said they were optimistic of an improvement this year.  

"There is still hope and the reopening of Archer Clothing Manufacturers late last year meant there was hope for other companies," said Sibanda.

"We hope Bulawayo will be declared a special economic zone this year and that will create employment," said Sibanda.

Last year, Finance Minister Patrick Chinamasa revised downwards to 3, 1 percent the projected economic growth from the initial 6, 1 percent, one of the worst growth rates for the country since the dollarisation of the economy in 2009. During that year, over 130 companies folded countrywide translating into over 920 job losses. The economy is this year likely to remain subdued, with the gross domestic product (GDP) growth projected at a mere 3,2 percent.