Harare – (22 January 2019) Zimbabwe’s chemicals and petroleum products sector is the least invested industry in Zimbabwe, a Zimbabwe industry report reveals. Only 25% of companies invested into the sector between September 2017 and August 2018 and the chemicals and petroleum industry consequently closed the survey period firing at 33.15% capacity utilisation. This subdued capacity utilisation was reached after the sector recorded a 10.5% output growth in 2018.
Zimbabwe’s foreign currency challenges have hampered the growth potential of its industry, with import dependent businesses failing to access raw materials timeously. Zimbabwe Business Member Organisations (BMOs) have called on government to assist businesses with assured policies and instruments that foster long term cost predictability, price stability, profit predictability and product availability; all key elements in building business and market confidence for Zimbabwe. The agro-based southern African country is fighting fiscal deficits and monetary supply imbalances, twin evils that were created by its government through years of financial indiscipline and fiscal mismanagement.
In a detailed paper to government titled: Crisis in Industry: Urgent Measures to avert business collapse, CZI has recommended a number of interventions to its government to curtail any further deterioration of Zimbabwe’s current economic crisis, including the creation of a credible market discovery of the foreign exchange rate and foreign currency availability, allowing interbank trading of foreign currency, allowing trading in US dollar as a precursor to the adoption of a local currency supported by reserves and underpinned by monetary and fiscal policies.
|Sector||Output Growth 2017||Output Growth 2018||Capacity Utilisation 2018||% of companies that invested in 2016||% of companies that invested in 2017|
|Drinks, tobacco and beverages||11.00%||18.75%||59.50%||62.50%||62.50%|
|Clothing and foot wear||21.61%||16.44%||43.56%||27.78%||27.78%|
|Wood and furniture||22.82%||11.73%||50.45%||50.00%||50.00%|
|Chemicals and petroleum products||3.55%||10.50%||33.15%||30.00%||25.00%|
|Non-metallic mineral products||8.33%||49.33%||35.00%||33.33%||33.33%|
|Metal and metal products||10.44%||3.21%||41.06%||30.30%||33.33%|
|Plastics and packaging||11.62%||8.15%||50.77%||69.23%||76.92%|
|Other manufactured goods||20.73%||8.36%||51.45%||54.55%||81.82%|