Farai Mabeza, Senior Staff Writer 
BUSINESS leaders say there is a need to renew the country’s economic diversification drive as primary products continue to dominate exports.
Confederation of Zimbabwe Industries president Kurai Matsheza said industrialisation was key in expanding the economy.
“There is a need to diversify, obviously, our production processes. Mining and services are coming up but more than 70 percent of our exports are mineral based.
Kurai Matsheza, CZI President
“In terms of the export diversification index, Zimbabwe is about 2,5, which is even lower than countries such as Somalia. The higher the number the less diversified you are. So, the ideal situation is to move closer to zero,” Matsheza told a national exporters’ conference last week.
“Only 18 percent of products exported by Zimbabwe have shown some competitive advantage.”
He further said that there were significant constraints to export diversification.
“There is a lot of reliance on primary products. Tobacco, minerals and gold are the major ones. We export most of these in raw form. We also have issues of macro-economic stability. Currently, we have issues of infrastructure, particularly to do with energy.
“Unless we do something as a country on power, it is going to be very difficult to make our economy go forward. Yes, there are 600 megawatts being expected later on, but still that will not be able to take us forward, there is still a lot that needs to be invested in that sector,” Matsheza said.
“So, until we can engage on industrial transformation, it will be very difficult to drive diversification. Investment in industrial transformation is key and we talk of the three stages of industrialisation for us to achieve the 2030 Vision.”
ZimTrade chief executive Allan Majuru said innovation would be key to achieving this goal.
“Our thrust as the national trade development and promotion agency is to ensure that we create equal market access to all businesses regardless of size; that we diversify our export offerings; and all those interested in exports are connected with buyers in the region, in Africa, and beyond.
“As we increase value addition, we also need to come up with new products that address current global changing consumer behaviour. For example, consumers are now after organic and natural products.
Allan Majuru, ZimTrade chief executive officer.
“As part of our efforts to commercialise our natural products, we are developing export clusters across all provinces, which are expected to unlock export value that lies within products and skills found within our communities, including rural communities,” Majuru said.
He added that opening up new markets would greatly assist in achieving diversification.
Mike Kamungeremu, Zimbabwe National Chmaber of Commerce president
“Enterprises have also had the opportunity to explore new markets for their products. Some of the non-traditional markets we are exporting to, although the volumes are still small in these markets, include Ivory Coast, Sierra Leone, Azerbaijan and Jordan,” Majuru said.
“We are glad that we have started exporting. What is left is to ride on the current products to grow our exports into non-traditional markets.”
Zimbabwe National Chamber of Commerce president Mike Kamungeremu emphasised the need for innovation.
“What is critical for us as a country is that we continue innovating so that we produce more and more goods that are attractive to markets. ZimTrade is leading the country in gathering intelligence and ensuring that we sell more to these markets,” Kamungeremu said.
He said it was also important to point out key aspects that may impede the country’s capacity to innovate, value add and diversify.
“Foreign currency retention is still an issue affecting exporters. If we sort this out and address it, we will be able to diversify and do more in exporting.
“Secondly, exporters and potential exporters are crying because of the interest rates, the 200 percent interest rate.
“They are saying, particularly those that had borrowed before the hike, that it’s an issue that needs to be looked at so that we do not impede the capacity to do more and diversify and export more,” Kamungeremu said.
“The sum total of all these issues is an improvement in the ease of doing business. If an improvement is realised then we can build more capacity such that we are then able to provide more products.”
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