5 January 2018

Zimbabwe: 'Govt Must Implement Policy Changes'

THE Zimbabwe National Chamber of Commerce (ZNCC) says the government must implement what it has promised if there is to be a turnaround in the economic fortunes of the country this year.

Since the rise to power of President Emmerson Mnangagwa on the back of military intervention, government has announced a raft of measures which include the cutting down of the wage bill through the retirement of civil servants above the age of 65, the reduction in government allowances and the mollification of indigenisation law.

ZNCC president Divine Ndhlukula told businessdigest on Wednesday that the business sector now expects the government to turn rhetoric into action to resuscitate the comatose economy.

"I think the long and short of it is that we keenly await the execution of the pronouncements which government has made, which include the US$150 million stabilisation fund for banks which will go a long way in shaping up the economy," Ndhlukula said.

She said there is optimism that the new dispensation will revitalise an economy that has been bogged down by a debilitating liquidity crunch, a crippling cash shortage, poor investment inflows, company closures and substantial job losses.

Ndhlukula said there was a "lot of optimism' among industrialists to the extent that the number of companies, which close shop at the end of the year due to viability problems has been reduced.

The ZNCC president said she is confident that the new political dispensation will deliver on its promises as leaders look to convince the electorate to vote for them in this year's make-or-break elections.

She described the past year as "terrible" for business characterised by company closures and retrenchments.

"The year 2017 was not a good year at all," Ndhlukula said. "A lot of businesses had to cut down through downsizing of its workers and a lot of doors were locked. It was a struggle."

Ndhlukula in an interview last year revealed the extent of the impact of delayed foreign currency allocation by the Reserve Bank of Zimbabwe.

Ndhlukula pointed out some companies have gone for more than a year without receiving their foreign currency allocation from the central bank.

"Business is failing to import raw materials because foreign payments are not being processed with some having been in the queue for over a year now. This has seen some cancelling of orders due to these delays. Some local suppliers have even doubled prices to allow themselves to buy forex," she said.

"The foreign currency allocation framework is not efficient as most of our members have to wait for months to be able to import and this promotes exploitative opportunities for speculators."

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