Home » Business » Industries Predict Gloom (allAfrica.com)

Confederation of Zimbabwe Industries (CZI) president, Busisa Moyo, says concrete measures were required immediately if the country was to avoid sliding further into the industrial crisis that has turned once vibrant companies upside down and triggered massive job losses.

In comments that gave an indication of the issues likely to dominate the CZI’s congress which kicks off in Gweru today, Moyo warned that unless urgent interventions were implemented the industrial crisis would deepen, with capacity utilisation now revised to 29,04 percent by year end, from the current projection of 36,3 percent.

Moyo was addressing a joint suppliers and producers conference in Bulawayo last week which ran concurrently with this year’s edition of the Mining Engineering and Transport (MINE-ENTRA) expo.

Moyo, head of the country’s biggest industrial lobby group, CZI, said during the first half of 2015, manufacturing volumes declined by between 15 and 20 percent.

He said prospects were bleak, and measures were imperative during the second half of the year.

“What do we do to recover lost ground?” queried Moyo.

“We are working together with our line ministry of industry to say let’s not allow things to get worse.”

He said it was not too late for growth stimulating solutions.

“If you superimposed any conditions that we have gone through as a country to any company in the world very few companies would survive. So whatever company is alive now, is worth saving; it’s worth looking at the policies around that company,” said the CZI boss.

“It’s worth looking at what are the binding constraints within those entities so that we at least stop the bleeding.”

When Zimbabwe dollarised in 2009, industrial capacity utilisation grew from about 10 percent to 57,2 percent in 2011 before taking the plunge after that year.

“If we do the right thing, we will stop the bleeding and at least stand still and that is what we have been working on; going around the Buy Zimbabwe campaign; all these are efforts on how do we stop the bleeding,” said Moyo.

The country has been spending over US$3 billion on imports despite the liquidity crisis facing companies.

“The US$3 billion of imports that we spend is money coming from Zimbabwe, so the money is there. There is the concept of liquidity challenge, but I don’t believe that. I do not believe we have a liquidity challenge because year after year, for the last five years we have been spending this US$3 billion, where has it been coming from? We must have it somewhere.”

Commenting on a World Bank report that ranked Zimbabwe 171 out of 189 countries in terms of the ease of doing business index, Moyo said these were indicators that significant steps were required to improve the investment climate.

“We may disagree on those figures but we must not ignore them because that is how the world is looking at us.

Nevertheless, we need to take our anger positively on some of these things so that we do the right thing. I think time has come for us to look at what we can do,” Moyo noted, adding that industry was waiting for the outcome of ongoing efforts by government to reduce the cost of doing business in Zimbabwe.

“Compared to our regional peers, we are quite high. It is difficult for us to supply our mining sector competitively where our costs are higher than those, for example, companies in South Africa. It is very difficult to remain in business and stay competitive,” Moyo pointed out.

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