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On Friday, Industry and Commerce Minister, Mike Bimha addressed the 99th Ordinary Session of the Zanu-PF Central Committee in Harare.
He delivered an uplifting message on the health of the economy and forecast a sustained recovery, attributing the positive run to the injection of foreign direct investment and the government’s radical, forward-looking policy interventions.
The economy is in its initial stages of stabilising, said the minister, with encouraging developments in tobacco farming, agro-processing, beverages, clothing and textiles and the automotive sector. Manufacturing firms, operating at 39 percent by June, should record up to 100 percent capacity utilisation by end of next year, he said. That sector, he added, is projected to grow by 1,6 percent this year, up from the initial forecast of 1,2 percent.
While this formative phase of recovery, amid the prevailing challenging economic environment is largely imperceptible and still only statistical to the ordinary person on the street, we are delighted by that modest progress and the prospects.
“A lot of the Central Committee membership had become used to the negative sentiments about the state of industry in Zimbabwe,” said Minister Bimha. “For them the story about industry in Zimbabwe is that they are just closing and people are being sent home. My presentation was more of looking at opportunities and the thrust of the paper was to indicate what the government was and is doing to address the challenges. There was a lot of applause when I announced that there has been a drop in the amount of imports as exemplified by the cooking oil sector.”
He said the edible oils sector is recovering on the back of a government decision to impose a provision that those intending to import cooking oil have to obtain a government licence, justifying why they must be permitted to buy the product abroad for local consumption.
“The result is that this has in turn led to the increased production by local manufacturers to the point that companies like Olivine are now talking of plans to export as a result of the curbing we have imposed on imports,” said Minister Bimha.
We are encouraged by the minister’s bullish statement.
We have seen a number of significant developments in terms of policy statements and implementation.
The minister noted the policy measures put in place to limit importation of certain products among them horticultural items, clothing and cooking oil. This is very important in ensuring that local producers have a market locally, instead of having to be crowded out by imported, cheaper and often poor quality products.
As foreign business sentiment improves over Zimbabwe, the country has, in recent months, received delegation upon delegation of prospective investors out to scout for new business, while others are making follow-ups on existing business.
Yet another Chinese business delegation is in the country as part of the work to update themselves on progress being made in implementing some of the mega deals signed during President Mugabe’s visit to China in August last year.
A German business delegation is in the country too. One from Russia was here last week, making a follow up on the $3 billion platinum mining project at Darwendale. Gazprom, the iconic Russian energy company has also expressed interest in investing in its line of business here.
Still on the energy sector, the ongoing extended electricity supply cuts have jolted the government to work harder to ensure that we not only expand the existing hydro and thermal power generation capacity, but also diversify it on a much bigger scale to harness the abundant solar potential our sunny climatic conditions offers. To this end, the government has approved three solar power plants to generate a total of 300 megawatts of electricity by 2018.
On a much bigger scale, two weeks ago, the government reached an agreement with its foreign creditors — the International Monetary Fund, World Bank and African Development Bank — on the strategy to address its $1,8 billion debt to them. This alone is a massive development to unlock lines of credit for local business.
In addition to the visits and positive statements of intent, there are a number of investments that have actually taken off. The Anchor Yeast one is an example after a French firm injected $17,5 million to revive the Gweru-based company.
These are critical developments that will take the economy to a higher level.
However, they will take time to show material change at a personal level. This, indeed, will test everyone’s patience.
The basic message, as Minister Bimha told the ruling party Central Committee is that a turnaround is beckoning. It enjoins all interested parties — the government, investors and the general public — to escalate that momentum.
Online Reporter