The Confederation of Zimbabwe Industries (CZI) recently said that local companies have to exploit the opportunities presented by Africa’s single market, the African Continental Free Trade Area (AfCFTA).
Speaking at the launch of the National Competitiveness Commission Report 2021, CZI president Kurai Matsheza said: “We have to re-think how we can exploit the opportunities presented by AfCFTA. These are the issues we have got to focus on to grow our economy.”
He said the recent census showed that the population was growing at a slower pace and it would not take the country far if it were to “grow this economy focusing on this small population”.
The call by the CZI comes after the Zimbabwe National Chamber of Commerce (ZNCC) recently called for an overhaul of the ease of doing business environment for local companies to benefit from AfCFTA and attract investors.
“The AfCFTA has taken off, international competition is beckoning, yet the country’s ease of doing business is still not conducive enough,” the ZNCC said.
The call by these two business member organisations is a wake-up call for the government and local companies to up their game and tap into the single market, the biggest trading bloc by member countries. There is a bigger cake which local companies can take a slice of.
With a population of over 1.3bn and combined GDP of $3.4 trillion, the AfCFTA is too good to resist. The local companies need to improve efficiency to be competitive in the single market.
The government has to step in by putting in place a favourable environment for local companies to be able to attract capital for retooling to build the necessary capacity required to be able to compete in the single market. There is also a need for the beefing up of the enablers—power, water and other infrastructure.
It is an area where the government has to move with speed. The expansion works at Hwange Power Station are almost complete. However, the 600MW to be added onto the national grid on completion won’t be enough as industries and miners are expanding their capacities. This should jolt the power utility to champion the investment into solar with the support from the energy regulator.
Efficiency across government ministries and departments and companies should be the new game in town. In the single market, efficiency and agility will rake in more benefits for an economy.
African countries see the AfCFTA as the continent’s Marshall Plan and the bridge out of poverty.
A report by the World Bank said the implementation of the single market, the largest trading bloc after the World Trade Organisation, will lift 100m Africans out of poverty and contribute US$450bn to Africa’s GDP by 2035.
The trading bloc will drive intra-African trade. The supply chain disruptions caused by the Covid-19 pandemic and the Russia-Ukraine war have jolted African countries to trade more among themselves. The era of restrictions and protectionism will not hold sway. The best time for local companies and the government to put their house in order was yesterday. The next best time is now as the single market beckons.
