Is Zim import control realistic?

As violent protests
erupted in response to the
imposition by Zimbabwe
on July 1 of import control
regulations, experts
questioned the country’s
ability to produce a lot
of these products in the
quantities and quality
required.
The Beitbridge border
was shut down immediately
as protesters burnt down
buildings – and South
Africans joined the protest
at the country’s border post,
resulting in traffic jams
that crippled operations.
However, reports were
that peace returned the
following day.
Under these new rules,
anyone wanting to import
from a lengthy list of goods
has to apply for a permit,
at a cost the equivalent of
R450 and valid for three
months. Also, applicants
have to justify the need
to import the particular
goods.
But, as basic foodstuffs
and beverages, household
furniture, windows and
doors, certain cosmetic
products and similar goods
are included – all products
commonly bought by bus
passengers on SA visits – the
ordinary Zimbabwean menin-
the-street are strongly
up in arms about these new
regulations, which they
profess to be unfair.
But the products on
which controls have
been imposed extend,
for example, to a host of
construction equipment
and structural parts – all of
which have previously been
imported in some quantity
from SA, and that raises its
own demands.
A far as the Zim
government is concerned,
this import ban will serve
two purposes – reining in
the ballooning import bill
(averaging the equivalent
of R105 billion annually
since 2011), and boosting
production of local
commodities.
But Duncan Bonnett,
the African trade executive
at Africa House, is not
convinced.
“Simply banning
imports,” he told FTW,
“isn’t going to encourage a
raft of industries to start
producing locally and in the
volumes required.”
And if that happens,
Bonnett feels that
government could do a
complete turnaround.
“At a generic level the
government changes its
mind so often. And, if the
products turn out to be
impossible to make locally
or not quickly enough, they
could just drop this import
control ban.”
And indeed a hint of
this happened in the weeks
just before July 1, when
angry protests were being
made at the proposed
introduction of the scheme.
The government actually
announced a temporary
suspension following
similar skirmishes at
the border only a week
before the controls were
introduced.
But Zimbabwe
manufacturers have
welcomed the move,
adding that it should be
complemented by the
removal of duty on raw
materials to boost local
production.
Confederation for
Zimbabwe Industries
president Busisa Moyo
agreed, adding that the
manufacturing sector
needed a kick-start and
the restrictions would
encourage the retail sector
to support local industries.
Certainly, some
product lines, like general
foodstuffs and beverages,
and dairy, creamer and
cereal products, could all
find local manufacturers
capable of meeting an
increased demand as
a result of the import
ban. The likes of the Buy
Zimbabwe partners –
Cairns, National Foods,
Nestlé, Dairibord and
Lyons among others –
are very likely to take
advantage of these
measures and significantly
increase production.
And indeed, Nestlé
should have the capacity
to meet national demand
after undertaking a capital
investment project to the
tune of the equivalent of
R450 million to refurbish
its manufacturing lines
and increase production
capacity.
But when it comes
to all the structural
products on the import
control list there could be
problems. Many of these
are complex in nature and
often made from highly
specialised metals and
by equally specialised
production techniques.
And SA manufacturers
who currently supply
much of this demand from
Zimbabwe are dubious
about whether local
manufacturers actually
exist who are capable of
meeting the production
standards required and
turning out the quantities
needed.
So, whether the import
controls will remain in
place in the longer term
still remains to be seen.
CAPTION
A burning warehouse at the Beitbridge border post ... protesters demonstrated their
dissatisfaction with the new legislation.