Manufactured exports below 9%

Manufactured exports below 9%
Published: 07 July 2014
Zimbabwe's exports have taken a knock from the struggling manufacturing sector which is operating at around 37 percent of installed capacity.

Latest trade figures from the Zimbabwe National Statistical Agency (ZimStats) show that manufactured exports presently constitute below 9 percent of the country’s exports.

This figure could be lower by year end as the sector has entered the second half of the year operating under sub-optimal conditions.

The ZimStats figure confirm a ZimTrade Local Export Manufacturing Capacity Survey 2013 report which notes that only 40 percent of manufacturing firms currently operating in the country are exporting their products and of those firms, the level of exports relative to total production stood 40 percent.

This has contributed to a worsening balance of trade position for the country.

ZimStats says the country's imports during the first five months of this year stood at $2,46 billion, while exports amounted to $990,32 million resulting in a trade deficit of $1,47 billion. The country's exports were down 23 percent from $1,3 billion from the prior comparable period.

But on a slightly more positive note imports also fell 23 percent from $3,2 billion compared to the same period last year.

Observers say this is probably indicative of the deflationary state of the economy, with consumers and companies having very limited spending power.

South Africa remained the largest trading partner accounting for $1.04 billion of imports and $609.12 million of exports.

Currently, the major export constraints relate to access to affordable capital, duty on imported raw materials, ageing equipment, high interest rates and high electricity charges.

Economists, however, contend that there is scope for significant export growth if the business operating environment is improve.
- BH24

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