The Zimbabwe National Chamber of Commerce (ZNCC) has urged government to involve small to medium enterprises (SMEs) in policy formulation.
By TARISAI MANDIZHA
ZNCC president Davison Norupiri told the Parliamentary Portfolio Committee on Industry and Commerce yesterday that government should not waste resources trying to resuscitate companies which could no longer be saved.
He said government should instead put in place policies to revive SMEs now being dubbed as the new emerging economy.
“We would want the government and parliamentarians to quickly address this and come up with favourable policies to support the emerging economy,” Norupiri said.
He said in the past the country used to be supported by three companies in the milling industry. Norupiri said one of the companies was currently operating between 30% and 35% in terms of capacity utilisation, the other one was almost not operating and the third one was operating at around 7% capacity utilisation.
Norupiri said the emerging economy was covering the current maize deficit.
“We have got the emerging economy, some or most of them are actually SMEs and the SMEs who are formal are not getting attention in terms of policy formulation. The attention mainly is being given to the informal sector which is not contributing to the fiscus so we strongly feel this economy is being driven by the emerging economy,” he said.
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“We have a number of industries to look at, we have a number of corporates who used to operate at full capacity and are no longer operating at full capacity. We had the Dimaf, government was trying to revive some of the companies but some of the companies cannot be revived.” he said.
He added that there were companies currently doing well in the dairy sector among many other sectors and government should put in place favourable policies to support them.
“We used to have Dairibord supplying the market but now we have the Kefalos, Dendairy and Alpha Omega who are doing very well in the industry. They have state-of-the-art machinery and there are currently supplying the industry very well and this is what we call the emerging economy,” Norupiri said.
Apart from favourable policies, Norupiri said the government should also address the issue of corruption, government failure to pay for services rendered by the private sector, high cost of borrowings, infrastructure improvements, delay of labour reforms, opportunities for women, and access to markets among many others.
According to the Confederation of Zimbabwe Industries, the manufacturing sector has recorded a 1,9 percentage increase in capacity utilisation to 39% driven by activities in the beverages and construction sectors.
In the same period in 2014, capacity utilisation was 37,1%.
Capacity utilisation for the manufacturing sector took off in 2009 at around 10% and rose to 57,2% in 2011 and since then it has been on the downward trend.
The manufacturing sector is facing challenges due to competition from cheap imports, unavailability of funds for retooling, low consumer demand and high production costs.
