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NewsDay

AMH is an independent media house free from political ties or outside influence. We have four newspapers: The Zimbabwe Independent, a business weekly published every Friday, The Standard, a weekly published every Sunday, and Southern and NewsDay, our daily newspapers. Each has an online edition.

Industries need everyone’s support

Editorials
Sekai Nzenza

THE general feeling is that for Zimbabwe’s economy to rebound, unrestrained access to loans to industry will do the trick.

The truth is, there are so many factors to consider in order to provide the right climate for industries to thrive.

Yes, the provision and access to cheap credit lines is vital.

This is because after going through two decade of crises, substantial capital injections have become paramount for companies.

The manufacturing industry requires not less than US$2 billion to retool, and mines say they require upwards of US$5 billion to prop up struggling firms.

But as the Chamber of Mines of Zimbabwe said last month, accessing credit had been difficult.

This is true, but it is important to say that as we report elsewhere in this issue, there are more interventions that are still required to support domestic industries.

In the aftermath of the launch of African Continental Free Trade Area, and many other regional trade pacts that are already in place, competition from formal African markets cannot be avoided.

The good thing is, Zimbabwe has appended its signature to these pacts, and Africa is opening up.

The greatest threat to domestic industries, as Industry and Commerce minister Sekai Nzenza points out, is the smuggling of cheap goods onto this market.

In this case, Nzenza is concerned about an overflow of cheap beverages, which are shutting domestic products out of the market, because the illegal products are cheap.

It is difficult to understand how these are shipped from as far as the Middle East, traverse African highways and ending up in Zimbabwe illegally.

But what is important is for the country to improve security on our borders and other smuggling flashpoints to protect domestic firms.

Unless this is done, the rush for cheap, sometimes dangerous foreign products will continue, and domestic producers will be suffocated.

The ramifications on jobs, and tax inflows to the State would be dire, and economic decline will continue to haunt us.

But what happened should be a wake-up call for local companies.

They have been pricing their products far higher than their regional peers, and they may be paying the price for that.

It is possible that producers in other countries, along with smugglers have realised the opportunities that lie in Zimbabwe because of the high prices, and they are sending goods to plug the gap.

However, domestic industries must be protected from any form of illegal, unfair competition at all costs.

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