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Zimbabwe approaching point of no return

by Staff reporter
12 January 2019 | 1649 Views
Long-suffering Zimbabweans should brace themselves for more price hikes and shortages of basic goods, after stressed companies said yesterday that they were left with an average of about 10 days' worth of supplies of raw materials used in the manufacturing of key products.

This comes as many companies have already closed shop in the past year due to the country's worsening economic meltdown, which has raised fears of a repeat of the ‘Armageddon' of 2008.

Addressing a meeting of business leaders in Harare yesterday, Confederation of Zimbabwe Industries (CZI) president, Sifelani Jabangwe, warned that more companies were on the brink of shutting down unless government acted on the deepening economic crisis.

It was also revealed yesterday that one of the country's leading refrigeration companies, Capri - which was represented at the CZI meeting by its boss Garry Watson - has been closed since November last year.

"Most of our members have less than a month of raw materials because there is no foreign currency to buy raw materials.

"Other companies have notified us that they are jammed with RTGS balances and to avoid making more losses, they have shut down.

"We communicated to government that we don't have more than 10 days because this is beyond us. Companies are shutting down and we have a list of many that have already shut down," Jabangwe said.

Confederation of Zimbabwe Retailers (CZR) president, Denford Mutashu, said there was chaos in government systems which was contributing to the rot.

On his part, Watson said the local market had shrunk significantly because of the economic crunch being experienced, which had forced his company to shut down.

"We have been open since those years of hyper-inflation but now we have closed down since November and we are not producing … 400 people are not at work," he said.

Wholesaling giant N Richards said industry was not producing enough to supply retailers with enough products, as this required the right operating environment.

"Tax evading stock buyers are willing to pay in US dollars while law abiding suppliers do not have the dollars and our shops are slowly emptying while tax evaders are thriving," company director Archie Dongo told the meeting.

Yesterday's meeting of business leaders came as the country's economic situation has worsened since the end of the festive season.

Zimbabwe is currently in the grip of a huge economic crisis which has resulted in shortages of basic consumer goods and medicines.

Apart from experiencing these, President Emmerson Mnangagwa's government is also battling to avoid strikes by civil servants who yesterday rejected a 10 percent salary
increase that they were offered.

The country is also reeling from biting fuel shortages which have disrupted the economy.

On Wednesday, distressed companies also pleaded with authorities to allocate them special supplies of fuel to stop the country's burning economy from imploding altogether.

Zimbabwe Point Return

Source: dailynews


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