Bulawayo, (New Ziana)-Zimbabwean manufacturers lack the appetite to export mainly because they already earn 72 percent of their revenue in United States dollars, and only 28 percent in the local currency, the Zimbabwe Gold (ZiG), an expert has said.
Confederation of Zimbabwean Industries chief economist Cornelius Dube said generally, players in the sector have decided to stop exporting and focus on satisfying the domestic market, which is largely foreign currency based.
“Manufacturing is now content only to satisfy the domestic market rather than the export market. Only 5 percent of output is exported, with the rest for the local market,” he said.
“In Bulawayo, USD earnings are even higher at 85 percent. This explains why they are not exporting, because they are getting their revenue in forex.”
Dube said there are two incentives for exporting, namely to get forex, and to access to markets, and the 72 percent USD revenue has left the manufacturing sector in a comfort zone.
He noted that Bulawayo, Masvingo, and the Midlands provinces find it easier to trade in forex and South African Rands compared to other provinces, further reducing the urgency to seek external markets.
Dube said there is need for national policies to be province specific in order to have impact, as each has its unique challenges such as key drivers like agriculture or mining.
“If we rely on national policies, the impact across provinces may differ. For example, Command Agriculture may benefit farming provinces, but we don’t expect much impact in Bulawayo because agriculture is not a key driver here.
Citing Bulawayo, which has abundant labour compared to other provinces, Dube said policies should be designed to leverage that advantage.
“When we say Zimbabwe’s economy is agro-based, that’s not true for Bulawayo. At the national level, mining and agriculture are critical for GDP, but policies like the $12 billion mining industry target or $14 billion agriculture drive may have minimal impact here,” he explained.
New Ziana
