Home » Industry » Competitiveness Vital [opinion]

The latest ZIMSTATS figures indicate that Zimbabwe’s import bill declined by $400 million to $2,5 billion for the period January to May 2014 compared to the same period last year. Our exports during the period under review were $990 million, resulting in the narrowing of our deficit to $1,4 billion which is still too high for our country, which is facing serious liquidity challenges.

That said we should be careful that we do not become perennial mourners but that we seek to understand the key drivers that have resulted in the positive movement for the first time in five years.

As we see it industry was divided on the need for the buy local initiative in 2011 when it started but now there is an overwhelming acceptance for local products.

Back then we even had the CZI president at the time Mr Kumbirai Katsande telling the Parliamentarians that the Buy Zimbabwe programme to be abandoned in favour of what was called “Produce Zimbabwe”. Besides the technical difficulty that were to arise from using such term, parliamentarians and the general public were taken aback over the apparent lack of unity in business.

That division created opportunities for those that were profiteering from importing goods and services at the expense of trying to promote local production. More importantly, the difference in terminology pointed to fundamental differences in priorities within our business arena.

Where the accent on Buy Zimbabwe implied an acceptance that the market is king, emphasis on production, implied that the fundamental focus of business is to attend to supply side issues.

To be fair to both sides, these were discussions that were critical to any business especially those that going through difficulties.

In essence the question was for success to happen, what area must be given greater attention between markets and production.

In reality it should be both, but compelling evidence the world over is that markets are sovereign and so unless you can create demand for your goods and services, nothing else matters.

Fortunately as imports continued to wreak havoc on our competitiveness, a number of local companies began to pay closer attention to what it is that can make them succeed in their backyard. From that analysis it emerged that in most instances consumers were attracted to foreign products and services because of their price, packaging and general appeal.

As such to be successful on the market one had to respond to the major drivers of consumer buying behaviour. Production therefore can never be a goal of any enterprise. The objective must always be one of ensuring that a product or service is bought. Buying Zimbabwe is thus a fundamental priority that we must tackle.

With this growing realisation, it soon became clear that as a country we needed to assess policies, laws, procurement practices, prices, quality and all determinants that influenced how our products or services were faring on the market.

The acceptance in turn resulted in local companies understanding that to succeed on the market they must innovate and compete against imported products and services.

Some like Dendairy invested in new technologies and packaging. They traversed the whole world going to faraway places such as India all to learn tricks of the trade.

When they began applying the acquired knowledge they were pleasantly surprised by the results. The market was equally ecstatic and responded by buying their products.

In no time we also began to see an increase in local companies introducing new products and slashing prices to compete and in some instances they managed to offer competitive prices to foreign products.

The likes of Turnall, who many were beginning to write obituaries, also upped their game. Rather than wait on Government to reopen Shabani Mashaba Mine they decided to introduce new roofing products that appeal to the increasingly sophisticated Zimbabwean middle to upper class.

The company also changed its business model to one that accepted changes on the local environment. Results too began to show as Turnall started recording positive cashflow growth.

On the retail shelves, Zimbabweans began to recognise that some local products were equally competitive to imported products.

In our opinion these are the reasons why we are now reversing the scourge of imports. The Buy Zimbabwe message is now being heard loud and clear. But that is only half the story. Our journey is still a long one. The fact still remains we still have a deficit and time to deal with it is fast running out.

As we write Quest Motors has been organising visits for Government officials to the assembling plant in Mutare.

Their investment into latest technologies to assemble affordable motor vehicles, buses and trucks is not yet being supported by Government and private sector.

As it is they are worried stiff that unless something urgent happens they may be forced to close and turn hundreds of workers on to the streets. Their appeal after playing their part is to be given a fair chance in public and private procurement programme. In any case their price and quality is second to none.

We are also receiving complaints from the likes of Lobels, who despite a remarkable turnaround and commitment to supporting local millers are saddened by the attitude shown by some partners in refusing to improve standards.

We are now at a point where all efforts must be directed at utilising the current momentum built by the buying local campaign to significantly reducing our trade deficit.

Local banks must come to the party in showing our industry how this positive trend can assist in providing liquidity that is required to acquire new machinery and retool various factories. Government must be made to account for their procurement decisions.

They must choose local products over foreign ones. We note that in the construction industry, the Chinese are now a dominant force simply because they are providing capital for projects. They must be made to work with locals in that arrangement.

Companies in the private sector that desire to have their products and service bought must too begin to show a willingness to engage their local counterparts.

This by no means, should be mistaken for tolerating sub standard offerings in the name of being local. Rather we must seek to be competitive as the ultimate weapon against imports. Minister Nhema said it well at the launch of the Buy Local Save Jobs campaign.

Just because we are not yet there should not mean we must give preference to those that are there. We know what we are capable of and efforts are being made to adjust and as such we must give all the support needed to win.

Yes the import bill is going down but the war is still a long way from being won. The time to Buy Zimbabwe is now.

Source : The Herald