BULAWAYO, October 5 (The Source) —Zimbabwe’s manufacturing capacity utilization – a measure of industry’s use of installed productive potential – is seen flat at 36 percent with aggregate demand falling due to squeezed family incomes, the Confederation of Zimbabwe Industries (CZI) has said.
The industrial body conducts an annual survey of industrial development.
CZI president Busisa Moyo said companies were facing many challenges, chief among them critical shortage of liquidity, power outages, smuggling, increased foreign competition and low consumer demand.
“On October 28 we would be launching our annual manufacturing sector survey but preliminary results highlight that business sentiment is lower than the previous years and that performance in several sectors has gone down but in others it has also gone up,” Moyo told delegates at a Zimbabwe National Chamber of Commerce pre-2016 National Budget Seminar in Bulawayo on Monday.
“However, as you know that our last report of the capacity utilization in the manufacturing sector was 36 percent and that was very low and we do not see that improving. We see it flat at best.”
Moyo also slammed power utility ZESA Holdings for failing to consult it over the 18 hour load shedding schedule it introduced last week.
The schedule shows that towns across the country without power between 4am and 10pm every day. The blackouts were blamed on breakdowns and repairs at power plants as well as low water levels at Lake Kariba.
“If we are to move forward as a nation we need convergence but unfortunately we don’t have it. For example, ZESA has come out with a load shedding schedule and all kinds of things without talking to business,” Moyo said.
“This is a big challenge that you issue out a load shedding schedule without discussing with business. Now they have misinformed His Excellency (President Robert Mugabe) and he is now (saying that) businesses must work at night. That (is not) practical. This is now festive season and we need to have convergence on how are we going to tackle the issue of power before we start issuing out load shedding schedule.”
The CZI manufacturing report is the most comprehensive private-sector led survey, which assesses industrial performance.
At least 15 economic sub-sectors are surveyed, including clothing and textile, pharmaceuticals, grain and milling, oil among other industrial manufacturing activities.
Moyo said the CZI would also launch its Business Confidence Index on Wednesday.