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Farirai Machivenyika Senior Reporter
The Government and private sector are fast-tracking the implementation of the Zimbabwe National Industrial Development Policy with two revolving funds worth US$30 million being established yesterday.
The two facilities, the Retooling for New Equipment and Replacement for the Value Chain Revolving Fund worth US$22,5 million and the US$7,5 million Tourism Facilities/Services Development and Upgrading Revolving Fund were launched by Finance and Economic Development Minister Professor Mthuli Ncube after signing memoranda of understanding with the Ministries of Industry and Commerce and Environment, Climate, Tourism and Hospitality Industry.
The Ministry of Industry and Commerce was represented by Permanent Secretary Dr Mavis Sibanda while the Tourism Ministry was represented by its Minister, Mangaliso Ndlovu.
Yesterday’s launch came after a US$20 million facility was launched on Monday targeting 18 small-holder irrigation schemes across the country.
The US$30 million facilities will be drawn from the US$958 million Special Drawing Rights, Zimbabwe was allocated by the International Monetary Fund last year to fund economic recovery programmes following disruptions caused by the Covid-19 outbreak in the past two years.
Companies will access the funds from banks that include FBC, Ecobank, Banc ABC and POSB with Government providing a guarantee for the money.
Prof Ncube said the funds were meant to assist companies, especially those in the agro-processing, retool to boost production, increase exports and employment creation and revive operations of firms in the tourism sector.
“In order to achieve a real economic transformation, Government in collaboration with the private sector is on an accelerated drive in implementing the Zimbabwe Industrial Development Policy (ZNIDP 2019-2020) to spur growth in the industrial sector.
“The industrial and tourism sectors are projected under the two funds to increase in manufactured output and capacity utilisation, import substitution, employment creation, access to finance, manufactured exports, GDP, foreign currency earnings, local communities’ tourism value chain and the multiplier growth of other economic sectors through derived demand,” Prof Ncube said.
The US$22,5 million facility would be split among various sectors with US$15 million being equally spread for companies in the cotton, leather and pharmaceuticals sectors, while those in agro-processing and fertilisers manufacturing will be allocated US$7,5 million.
In his remarks, Minister Ndlovu said the funding could not have come at the right time.
“We are really excited in witnessing another milestone in witnessing Government efforts to retool the industry and the tourism sectors.
“We fully welcome the support Treasury has given to these sectors, as we recover from the Covid pandemic. From the tourism perspective it has been a long time coming because we hoped to have this kind of support way before Covid, so we want to thank the President for coming to assist the sector.”
Dr Sibanda said: “We looking forward for the manufacturing sector receiving its US$22,5 million as you know we are in the period of NDS1 and we have 10 value chains which are prioritised in the NDS1 so the money will go towards retooling and replacing of machinery for the value chains.”
FBC Holdings chief executive, Mr John Mushayavanhu who was representing the participating bank thanked Government for utilising the SDRs for productive purposes.
“I have toured factories and some of the equipment I have seen need to be replaced and I have slept in some of the (hotel rooms) and you wouldn’t want to sleep in such rooms they seriously need refurbishment and if we are serious about growing tourism, I think we need to look at these assets.
“As banks we are going to lend to deserving persons and we will use our normal lending criteria,” he said.
Mr Mushayavanhu said they would ensure that the money would used appropriately adding that monitoring committees had been established for that end.
The duration and interest rates on the loans would be decided on a case by case basis, but Prof Ncube assured would-be clients that the loans would be affordable.
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