THE government is working on the business improvement model that will result in better linkages between the financial and manufacturing sectors, an official has said.
BY VICTORIA MTOMBA
Speaking during a tour organised by the Office of the President and Cabinet, Industry and Commerce minister Mike Bimha said the government was initiating measures that would improve the business operating environment.
“The model will be unveiled in due course once all necessary stakeholder consultations have been finalised. It is expected that the model will help improve the efficient utilisation of scarce resources and reduce non-performing loans in the economy,” Bimha said.
The country’s manufacturing sector is performing below 40% due to viability problems, competitiveness and liquidity crunch. The sector has seen many companies closing shop due to high cost of doing business and failure to pay loans to financiers. The sector has witnessed a wave of employee dismissals as labour costs have been one of the sector’s problems.
Bimha said the government had introduced rebates for inputs to the clothing, metals, electrical and dairy sectors in order to boost respective capacities by ensuring availability of imported inputs at a cheaper landed cost.
Speaking on the sidelines of the tour, Cairns Holdings judicial manager Reggie Saruchera said the company was expecting almost half of the $33 million by the third quarter of this year that Takura Capital was set to invest in the business.
“Takura Capital is bringing in $15 million for recapitalisation by end of September and that will increase our capacity to 80%,”Saruchera said.
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He said the funds would go a long way in making Cairns increase its output.
Cairns managing director Jeremiah Kwenda said Distressed and Marginalised Fund helped the company as it moved to 35% current capacity level from 5% in 2012 due to the $1 million fund that it received.
The company is one of government’s initiatives to assist distressed firms.
Small and Medium Enterprises (SMEs) minister Sithembiso Nyoni said the government would continue to assist SME’s as they contribute 60% of the country’s gross domestic product.
However, she said the SME ministry was not a vendor ministry.
“We are not a ministry of vendors .We want every vending site to have a site for production. We have enough qualified tailors who can provide quality clothes that will be cheap,” she said.
Senior principal director public affairs and knowledge management in the Office of the President and Cabinet Mary Mubi said the briefing was aimed at showing the developments in the manufacturing sector.
