CZI report to uncover manufacturing sector challenges

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CONFEDERATION of Zimbabwe Industries (CZI) president Kurai Matsheza says a forthcoming manufacturing sector report is set to give policymakers a detailed insight into the sector’s challenges and guidelines on how to improve it, amid rising foreign currency pressures and an anticipated low agricultural output.
Speaking to The Financial Gazette ahead of the launch of the report scheduled for May 4, Matsheza said the survey provides a comprehensive investigation into issues affecting the manufacturing sector.

“This survey looks broadly at the manufacturing sector in Zimbabwe in terms of the challenges they faced in 2021. It analyses whether the sector grew exports as well as how capacity utilisation fared in 2021… it also explores ways on how to engage with policymakers,” Matsheza said.

“It is an annual report covering the whole of 2021. It also explores the gaps and gives a better understanding on certain sectors lagging behind as well as areas that need attention. It also interrogates industry operations and the support from the government,” he added.

Access to foreign currency has been the manufacturing sector’s biggest challenge as it seeks to maintain the growth momentum after capacity utilisation surged to 66 percent in 2021 from 47 percent recorded in 2020 and 36,4 percent in 2019.

Besides foreign currency shortages, in its 2022 manufacturing sector outlook, CZI said in the past year, 82 percent of the constraints for business came from Covid-19-induced lockdowns and inflation.

According to investment advisory firm Akribos’ recent research note, the manufacturing sector was also at risk of being the hardest hit in the event of another Covid-19 wave.

Last year authorities said the economy grew by 7,8 percent on the back of a successful 2020/21 agricultural season, favourable international commodity prices and improved manufacturing sector capacity utilisation. With a 5,5 percent growth projection this year, which the International Monetary Fund however, argues will be at 3,5 percent, Zimbabwe is battling imported inflation and an anticipated low agricultural output.

Amid these pressures, the manufacturing sector is going to be one of the most affected as the country would require more forex to import raw materials.
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