LIVINGSTONE MARUFU
Industry is still waiting for the US$30m bailout promised by Finance and Economic Development minister Mthuli Ncube, a year after Zimbabwe received about US$1bn windfall from the International Monetary Fund (IMF).
Last year, Ncube promised to release US$30m from the IMF windfall to rescue the ailing industry.
He also promised to disburse ZWL$2.3bn to industry from the 2022 National Budget.
But, he is yet to do so.
The Confederation of Zimbabwe Industries CEO, Sekai Kuvarika told Business Times that industry players were yet to benefit from the promised funding.
The cotton sector value chain was promised US$10m, while the leather industry was to receive US$10m. The pharmaceuticals industry and the other agro-processing sectors were promised US$5m each.
“Industry is yet to benefit from these allocations. Allocations of these funds will greatly help industry to retool, which is long overdue,” Kuvarika told Business Times.
Zimbabwe’s development agenda is guided by the National Development Strategy (2021-2025) whose key priorities include, “the development and strengthening of value chains and structural transformation”.
This is complemented by the country’s National Industrial Development Policy.
A value chain can optimise operational efforts, reduce waste, and improve profitability.
Across the world, development of local value chains contributes to economic development, particularly through strengthening of local industries and job creation.
Where common problems are recurring, value chains can be used as a diagnostic tool to identify critical issues and blockages for specific groups and subsequently generate robust and effective policies and development strategies.
This will also provide a logical framework to formulate intervention strategies for producers and how to develop capacity.
Further to this, value chains are inherently scalable.
The value chain was going to reduce production costs by reducing the import bill and make their products more affordable.
Local value chain development will also enable identification of core rents and barriers to entry that determine who benefits from production for diverse final markets.
Experts say developed value chains can clear some of the economic challenges Zimbabwe is facing as a result of dysfunctional value chains, which have seen potential revenue leaching out of the country in the form of raw materials.
