STATISTICS from the Reserve Bank of Zimbabwe’s foreign currency auction system has revealed the need for the country to urgently improve its import substitution mechanisms for enhanced economic growth.
From the last foreign currency auction, nearly five hundred thousand (500 000) United States dollars was channelled towards paper and packaging which used to be produced in abundance by local entities.
It is against this background coupled with the closure of the South African border that economists have called for an urgent need for local manufacturers to up their game to sustain and create a balance between Zimbabwe’s import requirements and foreign currency generation capacity.
Economist, Mr Persistence Gwanyanya believes it is high time authorities expedite the local content strategy.
“Statistics from the RBZ forex allocation template reveals that Zimbabwe needs to introspect on some items taking a large chunk of forex and instead it should be producing them locally and save the much-needed forex for items that cannot be produced locally,” he said.
The sentiments were also echoed by another economist, Mr Titus Mukove who said the closure of the South African border recently should invoke Zimbabwean manufacturers to strategically position themselves to sustainably satisfy the local market.
“The agenda of import substitution is critical for the country in many aspects which bring immense benefits to the economy, as such spending large amounts of forex on consumables such as paper and packaging is highly unsustainable,” said Mukove.
For Zimbabwe to be spending the limited foreign currency on consumables like paper and packaging, it is highly unsustainable especially when one considers that top foreign currency earners for the country are finite mineral resources. – ZBC