HARARE, May 7 (NewsDay Live) — Zimbabwean industry is grappling with policy inconsistency and a volatile operating environment, with firms saying conflicting regulations, currency instability and rising fuel costs are undermining growth and competitiveness.
Businesses report mounting cost pressures linked to exchange-rate volatility and higher input prices, particularly for imported raw materials.
Data from the Zimbabwe National Statistics Agency (ZimStat) showed annual ZiG inflation rose 0.4 percentage points to 4.8% in April, driven largely by two fuel price increases during the month amid geopolitical tensions involving the United States, Israel and Iran.
Manufacturers say the fuel hikes have fed directly into production costs.
Speaking on the sidelines of a Zimbabwe Validation Workshop on Local Content Thresholds, local content strategy expert Tararama Gutu said overlapping and conflicting regulations remain a major constraint.
“Policy inconsistency is prevailing. We have multiple statutory instruments governing sectors such as agriculture and oil seeds, some of which conflict with each other and with regional trade protocols,” Gutu said.
“Even with local content, implementation must avoid undermining regional trade commitments.”
Competition and Tariff Commission spokesperson Prosper Ziyadhuma said the issue had been consistently raised by industry.
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“Government needs to maintain policy consistency after introducing measures and ensure effective implementation,” he said.
Ziyadhuma said local procurement policies could help revive domestic production, but high borrowing costs were limiting investment, particularly in textiles.
“If firms can access affordable financing, they can secure inputs and stabilise production,” he said.
He added that public procurement could be used as a lever to support local industry by prioritising suppliers that meet local content thresholds.
“The government is the largest buyer. Ministries and state entities can prioritise companies using local inputs through the PRAZ system, creating incentives for domestic production,” he said.
Industry and Commerce permanent secretary Tadeous Chifamba said authorities were strengthening enforcement of local content policies.
“Success depends on implementation, enforcement and institutional discipline. Countries that have succeeded anchor local content in law, align procurement with industrial policy and link compliance to incentives and financing,” Chifamba said.
He said government was moving to tighten the legal framework to ensure compliance is monitored and enforced.
“This marks a shift from a largely voluntary approach to a structured and accountable system,” he said.
Chifamba said the Local Content Strategy (2026–2035) aims to boost industrialisation by expanding domestic production and value chains while reducing import dependence.
The plan targets 16 sectors with strong potential for import substitution and value addition, with goals to raise local input utilisation from about 30% to 75% by 2035 and lift capacity utilisation from 57.3% to 75%.
Government is also targeting annual growth of 5% in manufactured exports’ contribution to output.
“These targets are designed to expand production and restructure the economy towards greater self-reliance and competitiveness,” Chifamba said.
