adminCONFEDERATION of Zimbabwe Industries president Charles Msipa has predicted 2014 to be more difficult for the manufacturing sector unless Government addresses key challenges facing the economy.
In an interview this week, Mr Msipa said that as long the economy remained subdued due to tight liquidity conditions industrial activity would continue to decline.
“Overall, 2014 is likely to be a difficult year for us unless key factors affecting manufacturing are addressed, but currently the situation painted a gloomy picture going ahead,” he said.
Industrial capacity dropped to 39 percent by July 2013 from 44,9 percent in 2012 while at the same time many companies ceased operations due to lack of funding, low demand and competition.
Mr Msipa said capacity utilisation in the manufacturing sector was being compromised by limited access to affordable medium to long term funding needed by companies to recapitalise operations.
He said in the final quarter of the year, economic growth was generally slow as consumer business remained subdued as a result of cash shortages in the economy, hence low demand.
“Domestic demand declined in the last quarter, condemning industry to a dire situation which calls for urgent attention,” he said.
Mr Msipa said there were, however, some companies which managed to either recapitalise or bring in new equipment or carried out plant upgrades to enhance efficiency.
The CZI boss said these companies will continue to achieve favourable results as they have invested much in their businesses in what puts them on the same pedestal as their competitors.
Among companies which managed to commission new plant and restructure business was Delta Corporation with its US$17 million lager plant and Turnall commissioned its tile making plant. — FinX.
Online Reporter