Cafca Limited, which manufactures cables is already making strategies in anticipation of protection against imports as the government put measures to control the movement of goods into Zimbabwe.
Managing Director at Cafca, Robert Neill Webster expects the company to be given a period of protection against imports after the government abandoned the Statutory Instrument 64 which banned certain goods from entering into the country.
“In anticipation of being given a period of protection from imports the company adopted a strategy of cash generation,” Webster said. “We managed to generate cash of US$4 million by improving working capital.”
“This will stand us in good stead to continue to service the local market and make resources available to reinvest in assets to improve competitiveness.”
The government is making plans of protecting companies against imports by introducing import licenses for products on selected goods to contain the trade deficit and protect struggling industries according to the Minister of Industry and Commerce, Mike Bimha.
Bimha said that tightening rules around imports would also suffocate the influx of cheap imported goods.
“We cannot be importing what we have, and soon the ministry will be introducing import licences on those selected goods,” said Bimha in a local media organisation.
“Anyone wishing to import the selected good will be obliged to apply for the import licence from the ministry.”
Webster said that in return for the protection given to the only company that produces cables in Zimbabwe against imports Cafca will have a responsibility to ensure that requirement in the local market are met.
“In addition the company is obliged to export to generate foreign currency,” Webster said.
“We will also require foreign currency to invest in assets to improve our competitiveness.”
Zimbabwe is currently in short of foreign currency hurting companies which rely on imports for manufacturing.
Competition between imports and Zimbabwean produce forced the government to introduce the SI64 despite riots against the instruments in Beitbridge.
Zimbabwean companies are using machinery acquired 40 years ago which cannot match the standards of industries from other countries.
