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Debra Matabvu —
Government will soon extend the life of Statutory Instrument 64, and add more products to the import control list following the success of the measures in various industries.
SI 64 was introduced in June 2016 to spur domestic production capacity by controlling importation of goods that can be manufactured in Zimbabwe.
A good number of success stories have been recorded, with the latest Confederation of Zimbabwe Industries Manufacturing Sector Survey Report showing that most participating companies were back on 100 percent capacity utilisation after years of near-stagnation.
The Statutory Instrument expires this month, but there are strong indications that Government is keen on keeping it in force.
Industry and Commerce Deputy Minister Chiratidzo Mabuwa told The Sunday Mail, “There is no reason why we should not renew (the Statutory Instrument). We have seen the positive impact it has had on companies. Therefore, we will also increase the number of items on the list, in consultation with the private sector.
“We are going to engage industry, and they will help us with the items they want us to include on the list. We have also set up a Monitoring and Evaluation Committee, which includes the private sector, to assess industry’s efficiencies.
‘‘Government will release reports periodically, detailing the success of our import controls.”
She went on: “Due to the introduction of the SI, the cooking oil industry has increased production to 90 percent, while tyre manufacturers have increased capacity utilisation from 30 percent to 50 percent following controls on the importation of second-hand tyres.
“So, we have a lot to celebrate, and are now working on addressing challenges that were inadvertently brought about by the SI such as monopolistic behaviour by some local producers, resulting in increased prices.”
The CZI Manufacturing Sector Survey Report shows that foodstuff production capacity is 56 percent, while that for drinks, tobacco and beverages is 52 percent.
Significant improvements were also realised in the dairy sector where 400 heifers were purchased in September 2016 to boost milk production.
In addition, many companies have invested in new machinery, with the cement manufacturing sector forking out over US$200 million.
Zimbabwe National Chamber of Commerce president Mr Davison Norupiri said, “We have seen serious positive results from the policy and we hope Government will even expand the policy and give it a two-year life span.
“It is not increasing production in the local industry only, but increasing investor confidence since the market is already guaranteed.”
Economist Dr Gift Mugano added, “Although it makes sense to extend its life, Government should help local industries recapitalise as we cannot continue extending it since we have regional obligations.
“Government should also remove Value Added Tax on machinery so that companies will be able to retool now and take advantage of the weak South African rand.
“These are the companies that can help turn around the country, thus they should be given as much help as possible and, in turn, these companies should also be innovative.”
Online Reporter