Low-price food imports hit Zimbabwe producers

Low-price food imports are causing grief for Zimbabwe producers, and are a growing problem.

Processed food imports are a major contribution to the trade deficit, which reached the equivalent of R42.5 billion last year, according to Bankers Association of Zimbabwe president Sam Malaba.

He added that they are a major driver of overall inflation deceleration – with food inflation now in consecutive decline for over a year.

Malaba told Zimbabwe newspaper, The Herald, that: “Local firms in the food sub sectors increasingly face thinning margins against the background of intense competition from imports. Processed food imports constitute a dominant share of the manufactured imports - in excess of R13.75bn per year since 2012.”

The growth in imports will likely persist, he added, in light of the strengthening of the US dollar and further depreciation of the rand over the near- and medium-term. This will further impact downward price pressures.