Zimbabwe verges on US$7bn exports ahead of target

Prosper Ndlovu, Business Editor
ZIMBABWE is inching closer to clocking the US$7 billion export earnings this year ahead of the 2023 target having already surpassed the US$6 billion mark in 2021 as Government policy reform measures continue to impact positively on the domestic productive sector with a drastic jump in trade receipts.

Developing a vibrant export sector is one of the key drivers of economic development under the country’s National Development Strategy (NDS1), and a major contributor towards attainment of an upper-middle-income vision by 2030.

In line with the National Export Strategy, which was launched in Bulawayo in 2019 and set a US$7 billion by 2023, the country has shrugged off the devastating effects of Covid-19 and raging geopolitical complications to record a number of positives towards achieving this target.

In 2021 exports grew by 37,3 percent to US$6,03 billion, from US$4,39 billion in 2020, surpassing the 10 percent annual growth target, according to official Government statistics. During the period the manufacturing sector alone realised a 5,5 percent increase in exports to US$404 million.

Zimbabwe has in recent years expanded its exports to the United Arab Emirates, for instance, from around US$148 million earnings in 2015 to about US$1,5 billion in 2021, becoming the second largest export partner after South Africa. Minerals and alloys, tobacco, processed foods as well as horticultural produce and clothing and textiles remain the major export drivers, and Zimbabwe could reap more through value addition and diversifying its market, says ZimTrade, the country trade development and promotion agency.

So far this year, total exports surged by about 18,4 percent to around US$3,3 billion as of July and predictions are that “we will hit the US$7 billion mark in 2022, which was our target for 2023,” ZimTrade chief executive officer, Mr Allan Majuru, told delegates yesterday during the hybrid 2022 Annual Exporters Conference hosted in Harare.

The jump in productive sector capacity utilisation and export earnings is attributed to enhanced policy support measures introduced by the Government, said Finance and Economic Development Minister, Prof Mthuli Ncube, in his official opening remarks of the conference on behalf of President Mnangagwa.

The support measures include; easier and cheaper access to foreign currency for industry at the forex auction system, tax rebate schemes for selected sectors, general improvement in the ease of doing business and spinoffs from the economic diplomacy-focused Government’s engagement and re-engagement policy. Prof Ncube said these policy interventions have seen overall capacity utilisation in the manufacturing sector rising from 47 percent in 2020 and jumping to 66 percent in 2021, the highest level recorded since 2012.

“The role played by exporters in this endeavour cannot be over-emphasised, as they toil to bring in the much-needed foreign currency, create jobs for our citizenry and set the pace for technological advancements,” he said.

“This is key to pursuing industrialisation aimed at achieving a structurally balanced economy by the end of NDS1. The Government is also dedicated to coming up with sustainable solutions for challenges that face our exporters.

“Indeed, as the world is recovering from a pandemic, with an imminent global recession, measures to improve product competitiveness have been instituted.”

Going forward, Prof Ncube said accelerating the ongoing ease of doing business reforms to lower transaction costs actively supports our successful engagement and re-engagement with the global community, which has implications on exports.

He said the horticulture sector, in particular, is expected to achieve a 30 percent annual growth rate by 2030 with Government recently launching a US$20 million Horticulture Revolving Fund to assist exporters with their foreign currency requirements.

“I’m very pleased to note the extraordinary performance of our country’s blueberries on the international market over the past year owing to their superior quality,” said Prof Ncube.

As a result, he said Zimbabwe has transformed from being an importer of blueberries to one of the leading blueberry producers in the region, exporting to the United Kingdom and the United Arab Emirates, among others.

In line with the devolution thrust, the minister said developing provincial economies must inform the identification and manufacturing of unique products that would also feed into exports, thereby promoting inclusive growth.

He commended ZimTrade for carrying out Economic Mapping Survey in each of the country’s 10 provinces in 2021 and establishing export clusters in identified areas and sectors.

“The need to establish economic independence at the district level is paramount, and this inclusive approach ensures that the country’s exports are widely diversified to the full extent of the country’s capabilities,” said Prof Ncube.

He said ZimTrade’s “Next-She-Exporter” programme, a female-focused programme that seeks to balance gender representation in exports by equipping women-led SMEs with skills requisite to penetrating and achieving excellence in export markets, was commendable.

The organisation has also continued with its award-winning Eagle’s Nest programme, a youth incubator programme to nurture youth-led SMEs into export-ready companies.

Prof Ncube challenged conference delegates to collectively thrive towards building a strong national brand to enhance the competitiveness of domestic goods, increasing export demand, and attracting foreign investment.

He said this year’s conference, running under the theme, “Inclusive, Diversified, Connected,” speaks to the need for deliberate inclusiveness in developing and promoting trade, diversifying the export basket and integrating through connecting with regional and global markets.

In his remarks, Foreign Affairs and International Trade Minister, Frederick Shava, said transforming the economy from an exporter of raw commodities and semi-processed products to an exporter of internationally competitive high-value products was a key objective of the National Trade Policy.

“As we diversify our exports from commodities into high-value products, efforts will be made to ensure that all the country’s provinces are included and no one is left behind in this development process,” he said.

Despite the adverse macroeconomic environment, Industry and Commerce Minister, Dr Sekai Nzenza, said the manufacturing sector is projected to grow at an average of 3.7% during 2023, on the back of value addition and beneficiation activities in the industrial, mining and agricultural sectors.

She urged producers to take advantage of export opportunities in the region and beyond to grow their earnings. The conference began on Wednesday and drew participation from a diversity of local exporters, industry executives, representatives of international organisations and foreign buyers.

Article Source: The Chronicle