Zimbabwe adjusts customs tariffs

Like an economic juggler,
the Zimbabwe government’s
finance authorities are busy
adjusting customs tariffs to
support what they term goods
of “strategic importance”.
These customs’ duties
are a big contribution to the
country’s total income –
recorded at 22.7% (US$212.2-
million) of total revenue
receipts in 2009, of which
US$49.4-m was obtained
from oil imports.
And, while Zimbabwe is
a signatory to the Southern
African Development
Community (SADC) free
trade area (FTA), various
goods imported from other
member states of the FTA
continue to face customs
duties, according to the
latest research by Standard
Bank’s Zimbabwe economics
specialist, Yvette Babb.
The path Zimbabwe is
supposed to follow in this
regional trading agreement is
that 85% of goods imported
by Zimbabwe originating in
SADC are required to face a
zero per cent tariff, with the
remaining 15% tariffs to be
reduced by 2012.
“But,” said Babb,
“products still subject to
import barriers are deemed
to be sensitive goods which
receive protection in the form
of tariffs because of their
‘strategic importance’ to the
economy.
“The government of
Zimbabwe has continued to
use tariffs as a measure of
protection for its domestic
industries in the past decade,
increasing the rate of tariffs
for products that are
produced locally while
lowering tariffs on
intermediate goods and
capital equipment that are
imported by local producers.”
However, Babb noted,
the government moved to
suspend customs duties on
basic commodities with
the launch of the shortterm
economic recovery
programme (Sterp) – and the
minister of finance moved
to extend this measure until
July 31, 2010. Also, the
suspension was extended
to selected inputs used in
local production of basic
commodities.
The commodities on which
duty is suspended include
cooking oil, margarine, rice,
flour, salt, mealie-meal, bath
and laundry soap, washing
powder, toothpaste and
petroleum jelly.
And, Babb told FTW:
“Customs duties on
select capital goods and
intermediate goods were
reduced further in the 2010
budget – with duty on halftonne
pickup trucks, for
example, dropping from 40%
to 25%; small passenger
motor vehicles (40% to 25%)
and livestock for breeding
(5% to 0%).”