Story by Stanley James, Business Editor
ZIMBABWE has reduced the import bill from South Africa by over US$140 million in the first seven months of the year, riding on the manufacturing industry recovery that has increased the availability of locally produced goods.
The country’s trade promotion body, ZimTrade, has confirmed to ZBC News on Monday that imports from South Africa dropped by over six percent to around US$2 billion between January and July from over US$2.3 billion during the same period last year.
Interestingly, grocery imports have declined by huge margins, reflecting the resilience of the manufacturing industry in producing enough commodities to sustain the domestic market requirements.
With machinery maintaining the dominance on imports from South Africa, the trend is described as a shift of Zimbabwe from being a consumptive economy to a more production-oriented nation.
“A huge import bill is not good for a nation as it reflects the failure by the domestic industry to innovate business systems and come up with workable strategies that enhance productivity in an economy like Zimbabwe. Maximising output by industry has a net positive impact towards reducing the burden of reliance on externally produced goods. Judging by the latest findings from ZimTrade, one can see that the increased availability and reforms within the manufacturing sector are yielding the desired results, leading to significant improvements in the overall balance of trade with one of our largest trading partner, South Africa. What is needed is for the local industries to scale up production, ensuring that what is produced sustains the domestic markets and also the export arena. By so doing, it means more business growth opportunities that cascade into overall development value chains,” Confederation of Zimbabwe Industries’ Chief Economist Dr Cornelius Dube said.
An economist, Dr Zack Murerwa believes a fall in the country’s import bill reflects increased confidence by Zimbabweans on locally produced goods.
“The trend reflects a situation whereby the economy is recovering and as such, there are notable strides from the manufacturing industry that have anchored production of goods leading to the fall in imports. It is basically a notable achievement as Zimbabwe forges ahead with reforms that are premised towards increasing foreign currency receipts. While balancing the initiative with reduced imports, going forward, the government and the private sector should continue with the ease of doing business reforms that will feature a competitive edge in the domestic production process, thereby enhancing service delivery for the benefit of the nation.”
South Africa, however, remains Zimbabwe’s largest trading partner in the Southern African Development Community region.
