Online Reporter
Nqobile Bhebhe,Zimpapers Business Hub
THE Reserve Bank of Zimbabwe (RBZ)’s Targeted Finance Facility (TFF), introduced to address liquidity challenges in the banking sector and revive struggling productive sectors, is fast bearing fruit, with Edgars Stores Limited reporting a notable increase in production.
In a trading update for the half year ended 6 July, Edgars chief executive officer Mr Sevious Mushosho said the facility has had a direct impact on the company’s performance, with production volumes rising significantly.
“Units produced during the period under review increased by 40 percent from 132k last year to 185k,” said Mr Mushosho.
The factory continues with its cost-optimisation strategy by adopting the latest efficient production processes.”
He said the group had invested US$345 000 in a new cutting room solution, financed through the Central Bank’s Targeted Finance Facility, towards the end of the half year, an initiative expected to further enhance productivity.
“This strategy bodes well with the retail chains as it ensures delivery of quality products at competitive prices. The Group is appreciative of efforts by the Central Bank in enhancing the productive sectors of the economy,” said Mr Mushosho.
He added that Edgars also applauded Government efforts aimed at improving the ease of doing business in the retail sector.
“The Group applauds efforts by the Government towards reducing the cost of doing business for retailers and associated industries through streamlining regulatory requirements, reducing costs of compliance and restoring orderly trading in urban centres, as these are key pillars in levelling the playfield,” he said.
The introduction of the TFF has been welcomed by industry players, who have long lobbied for access to affordable capital to ease working capital constraints.
The facility, which provides financing to banks at a concessional rate of 20 percent and allows on-lending at a maximum of 30 percent, offers a crucial alternative to market rates currently hovering between 40 and 46 percent.
Industry experts say such interventions are vital in supporting domestic production and boosting competitiveness in the retail and manufacturing sectors.
Bongani Ndlovu