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LOCAL textile manufacturers have lamented excessive bureaucracy in the processing of export documents, which they say is affecting their trade into the region and abroad.
King Fisher textile company public relations manager Ellen Makande said there was little incentive for textile producers to export.
And for those textile firms who do export, delays in processing their export documents was so slow to the extent of them losing their clients to other producers.
“There’s no incentive in place for local industries to export and in some cases the red tape involved in export documents causes delays and makes export customers question the need to import from Zimbabwe,” said Makande.
“The red tape and legislation manufacturers currently face even deters new prospective manufacturers.’
According to the Zimbabwe Textile Manufacturers’ Association (ZTMA), the sector was operating at below 30 percent of installed capacity as at half year.
In terms of other challenges facing the sector, Makande said illiquidity in the local market was affecting viability, especially due to increased imports of cheaper Chinese products.
“Above all, liquidity in the market place will continue to decline as a result of increased imports, which requires money to be remitted in order to pay for the goods as opposed to that money circulating in our domestic economy.
“Lack of liquidity creates further challenges in that it is difficult to access loans at affordable rates which restricts growth and makes it difficult to take advantage of any opportunities which may come along.
This also makes it impossible to upgrade current capital machinery which in most companies is old and outdated and as a result experiences more breakdowns,” she said.
“Cheap Chinese imports have been allowed to flood the market and make it impossible for the local industry to compete as they are being sold at prices which are sometimes below local cost. This has seen the closure of many textile companies as most people now prefer to import rather than support the local industry.
“China gives between 14 percent — 20 percent export incentives, hence Chinese manufacturers are able to produce goods at cost or slightly above and still retain profitability.” — BH24
Online Reporter