Friday, October 25, 2013

Zimbabwe Government to Address Liquidity

Govt to address liquidity: VP

October 25, 2013
Business Reporter
Zimbabwe Herald

GOVERNMENT will explore all available avenues to secure affordable lines of credit to revive the manufacturing sector, Vice President Joice Mujuru said yesterday.

Addressing delegates who attended the ZimTrade Exporters’ Conference in Harare, VP Mujuru said Government was concerned with liquidity constraints affecting manufacturers, saying the economic policy to be launched soon would address some of the challenges. Zimbabwe’s manufacturing sector requires an estimated US$2 billion for recapitalisation.

“I would like to assure industry and commerce that Government is aware of the liquidity and supply side challenges that industry is facing,” said VP Mujuru.

“Consequently, Government, will, through the Zimbabwe Agenda for Sustainable Socio-Economic Transformation, explore all means to access affordable sources of funding to capacitate industry, to retool and to invest in new and relevant technology.”

Zim Asset is a medium-term economic blueprint that focuses on stimulating the economy. The blueprint targets an average 7,3 percent economic growth in the next five years. VP Mujuru said the poor performance of the manufacturing sector had seen the influx of mostly sub-standard imports, thus creating unfair competition for local producers.

Some of the factors that have constrained the industry include low aggregate demand due to low disposable incomes.

This has resulted in the manufacturing sector operating below capacity. Individual consumption is skewed towards basic commodities, thereby negatively affecting the rest of the industry outside the value chain of basic commodities.

Lack of demand has also been worsened by the fact that Government has little to spend.

In a country with a Government with a limited purse, the economy goes into stagnation in the absence of a stimulus package.

Lack of long-term loans caused by transitory deposits has also made it difficult for industry to obtain long- term credit for retooling and working capital.

With Zimbabwe’s debt at close to US$11 billion, this on its own raises the country’s risk profile and makes it difficult for companies to source offshore finance.

In recent years, Zimbabwe’s economy has also suffered from stiff competition from foreign trade leading to a situation where the country is literally running trade deficits with most trading partners.

VP Mujuru expressed concern over the widening the trade deficit, saying urgent measures must be taken to improve the trade balance through robust export performance.

“As an economy, it is critical to restore the manufacturing sector’s contribution to export earnings from the current 16 percent to 50 percent by 2016,” said VP Mujuru. She urged companies to redefine their business models and be innovative to sustain competition.

Local producers were also urged to take advantage of bilateral regional and international trade and investment protocols signed by the Government to penetrate export markets.

VP Mujuru implored ZimTrade to embrace Information Communication Technology by promoting on-line trading, critical for facilitating imports from Zimbabwe.

Earlier, ZimTrade chief executive Mrs Sithembile Pi- lime told delegates that the trade and export promotion body would next year embark on road shows to promote Zimbabwe’s exports.

She said there was need to spread the market risk as Zimbabwe was exporting the bulk of its goods to South Africa. “If anything goes wrong with that market, we will be in trouble,” she said.

The conference was held under the theme “Value Chain Business Models: The Key to Export Competitiveness”.

VP Mujuru decries Renamo banditry

October 24, 2013
Senior Reporter
Zimbabwe Herald

VICE PRESIDENT Joice Mujuru has described the Mozambican National Resistance Movement’s return to the bush to start fighting Cde Armando Guebuza’s government as sad. She told ZBC News last night that Western countries that sponsor Renamo had not forgiven the Sadc region for challenging white supremacy.

“Our entrance is Mozambique and that is our route to the sea, our railway line, our fuel and everything. So we have to protect our pipeline and whatever goods are coming through Mozambique.

“This is not what we expect in the region at the moment considering that we are going to lose life. We have already lost our stature through this Western destabilisation.”

Cde Mujuru said a million people were killed over 16 years of the bloody civil war which destabilised not only Mozambique, but the entire sub-region.

She said Zimbabwe and its regional counterpart would go back to the round table on how the conflict can be stopped.

Zimbabwe-Mozambique Friendship Association chairperson Mr Devy Popatlal said what Renamo was doing was senseless.

Renamo staged a pre-dawn attack on a police station on Tuesday after declaring the end of a two-decade-old peace deal that ended one of Africa’s worst civil wars, officials and locals said.

Police fled their post in the central town of Maringue when Renamo fighters opened fire in an escalation of hostilities between the ex-rebels and Frelimo, the ruling party.

“The Portuguese government is following with concern the situation reported in Gorongosa,” the foreign ministry said in a statement, also calling for the country “to quickly return to a normal situation so it can follow a path of economic development and social progress”. Gunmen attacked the police station, fortunately there were no casualties because the policemen fled the post,” Maringue’s administrator Antonio Absalao said.

The town is located about 35 kilometres from Renamo’s military base, which government troops seized on Monday in an operation the ex-rebels claimed was aimed at killing their leader, Afonso Dhlakama.

“The situation is horrible here. Early this (Tuesday) morning, armed men supposed to be Renamo attacked, and it was a mess,” said Romao Martins, a Maringue teacher.

“For one hour shooting could be heard from all directions and people fled from their homes,” he said.

Schools have been shut amid fears of an escalation in violence.

The United States said it “profoundly deplores” the resumption of violence, urging both parties to take “decisive steps to calm tensions”.

“We will welcome public declarations of representatives calling for peaceful solutions,” the US embassy in Maputo added in a statement.

A spokesman for Renamo hinted that the group was responsible for yesterday’s attack.

“The president of Renamo has lost control of the situation and you cannot blame . . . (him) for what happens from here on,” Fernando Mazanga told AFP.

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