Ellen Chasokela Herald Reporter
Government is seeking lines of credit to support the manufacturing sector as it moves to capacitate the key sector to enable it to increase exports across the continent.
Critically, the move will allow companies to compete in the African Continental Free Trade Agreement (AfCFTA), a trade pact that is expected to create a single market in Africa, which came live on May 30.
Officiating at the National Forum on the AfCFTA in Harare yesterday, Foreign Affairs and International Trade Secretary Ambassador James Manzou said exports are seen as important to national development across the world, hence the deliberate decision by Government to support local manufacturers.
“In order to address the funding challenges facing our local companies, Government through the Ministry of Industry and Commerce is seeking lines of credit to support the manufacturing sector so that they can participate in the export markets and generate the much needed foreign currency,” said Ambassador Manzou.
“Exports have, the world over, been recognised as key in the development of a nation’s economy. For Zimbabwe, the export performance has largely been subdued, falling short of its potential to drive economic growth.
“A number of factors including supply-side, competitiveness and trade facilitation challenges, among others, have affected the ease of doing export business and hence, poor export performance.”
Ambassador Manzou said the suppressed production in industry has resulted in the country relying on imports of key raw materials for the manufacturing sector such as wheat and crude oil.
Coupled with electricity, medical drug and fuel imports, the country is losing a lot of foreign currency at a time it requires it the most.
Lack of funds for capital expenditure and working capital has also seen local firms failing to adopt latest production equipment that are efficient; producing in less time and also saving on electricity consumption.
Ambassador Manzou said increasing capacity utilisation in the manufacturing sector was crucial in cutting the country’s trade deficit.
“Our exporters need to strategise and keep abreast with the developments in the global market and leverage on these changes. It is my sincere hope that once the AfCFTA national strategy is finalised, the private sector and the public sector will work in close collaboration to ensure that the programmes and activities identified therein are implemented,” he said.
Ambassador Manzou added that Government, through the Ministry of Foreign Affairs and International Trade, was in the process of finalising the National Trade Policy and Export Strategy and the accompanying implementation, monitoring and evaluation frameworks for Zimbabwe.