Treasury disburses ZiG34.4m industry bailout
LIVINGSTONE MARUFU
The Treasury has disbursed ZiG34.4m to the Ministry of Industry and Commerce in the six months leading up to June 30 of this year in order to boost industrial capacity utilisation and save some companies from total collapse, Finance Minister, Professor Mthuli Ncube has said.
Treasury’s goodwill comes at a time when companies are in need of patient capital to ramp up output after years of deindustrialization.
“To facilitate the growth of the manufacturing sector, an amount of ZiG34.5m was disbursed to the Ministry of Industry and Commerce during the period under review,” Professor Ncube said.
He added: “The sector also benefited from Development Partner assistance amounting to US$1.8m. Of the amount, US$1.3m was disbursed by the Swedish Embassy towards capacity building to the Confederation of Zimbabwe Industries for strengthening industrial transformation, enterprise development and entrepreneurship development.”
He said that significant investments in modern cutting-edge automation technology, like robotics, have raised output.
“Similarly, the Dairy Processors Association of Zimbabwe has formed partnerships with tertiary institutions such as the Harare Institute of Technology, Chinhoyi University of Technology and a Danish University to enhance the training of technicians in areas related to real dairy 26 technology, production efficiencies and ensuring high product quality.
New production technologies are also being installed in the edible oils, beverages and subsectors. All these interventions are directly increasing productivity through modern technology,” Professor Ncube said.
He said the growth of the manufacturing sector has been revised upwards to 2.5% from 1.6% projected in November 2023, to reflect the expected positive impact of the substantial investments underway in both existing and new plant and machinery.
Professor Ncube is, however, concerned that huge investments in the manufacturing are not translating into improved capacity utilisation due to economic headwinds affecting the industry.
According to Professor Ncube, the tobacco sub-sector did well in the first half of the year. To encourage the sub-sector’s growth, the government is creating a Tobacco Special Economic Zone (TSEZ) that would be dedicated to the sales and processing of tobacco products.
In an effort to boost the apparel subsector, the government is also expeditiously amending the Zimbabwe Cotton-to-Clothing Strategy 2024–2030.
According to him, the fertilizer subsector saw noteworthy investments, including renovations at two of the biggest producers of fertilizer, Sable Chemicals and ZFC Limited. The subsector also saw the entry of two new players, which will significantly increase fertilizer output moving forward.
