Zimbabwe industry capacity utilisation to exceed 50%

THE country's manufacturing sector capacity utilisation is set to exceed 50 percent this year on the back of gains achieved in the last two years, with more positive prospects under the new political dispensation.

Confederation of Zimbabwe Industries (CZI) Matabeleland Chapter president, who is also General Manager of General Beltings, Mr Joseph Gunda, said hopes were high that when they issue out their annual performance report before end of the year, the sector would show solid footing.

This is despite the persistent liquidity constraints in the economy, which have been compounded by cash shortages. Mr Gunda said Bulawayo industries, arguably the heart of manufacturing in the country, were on the mend although more work was needed on some limping companies. As such, he said, capacity utilisation was this year "expected to be above 50 percent" compared to last year's 45 percent.

"I can say with confidence that Bulawayo industry is on the road to recovery and we're happy to report that there is an improvement from 2016 in manufacturing. Some individual companies are even sitting at 90 percent," said Mr Gunda.

"We believe we need to drive momentum to capture other companies."

Most companies benefited from the import control measures put by Government such as Statutory Instrument 64 of 2016 and pre-shipment regulations. The move allowed firms to bolster their production levels while having competitive advantage on the market.

Mr Gunda commended initiatives by prominent businessman and newly-elected Bulawayo South MP, Mr Raj Modi, who is working on expanding the technology sector. He said more such efforts were needed to catalyse growth. The CZI leader also said the Special Economic Zones (SEZs) model was set to spur growth, particularly in Bulawayo and other designated areas in the country. The initiative has to be implemented in earnest, he said.

Mr Gunda, however, stressed that full recovery of industries could be quickened through creation of synergies across all sectors. He said the designation of Bulawayo, Sunway City in Harare, Victoria Falls and Tugwi Mukosi as SEZs, would succeed more with an synergised framework that supports value chains.

Bulawayo has already set up a committee to drive implementation of the SEZ model to seize business opportunities. However, CZI has recommended that all sectors be roped into SEZ as opposed to adopting a sectoral approach. "Bulawayo is now focused on rebuilding industry since it was declared a Special Economic Zone. However, our technical working group has identified low hanging fruits in Bulawayo and about 15 sectors, which we have ranked.

"Our recommendation is that Bulawayo is not only textile and leather but has several other industries that have an equal bearing. Industry has to function as a unit than selecting just two and we have made a proposal that they work in synergies," said Mr Gunda.

He said CZI was in the process of creating a database on industrial activity in Bulawayo, which will be used in identifying investors.

"It's unfortunate that some industries were turned into churches but we want to create a database of spaces and structures available in Bulawayo so that it's easy to handle any inquiries from investors," said Mr Gunda.

He said the technical committee has identified education, innovation and research, pharmaceuticals and healthcare sector, transport and logistics (mainly as an enabler), engineering (with focus on steel and foundry as an enabler), rubber and plastics, printing and packaging.

Others include tourism and hospitality (focusing on Bulawayo's MICE - Meetings, Incentives, Conferences and Exhibitions) activities that have the capacity and ability to host conferences, and exhibitions, creative arts and culture industries sector, wood and furniture sector, information media and media service, agro-industry and horticulture, and minerals value addition as some of the sectors.