ZimTrade in a monthly trading post discussed the impacts of the COVID-19 pandemic to trade between Zimbabwe and China.
Zimbabwe’s exports to China were worth US$974 million while imports value were US$369 million in 2019 according to Trade Map.
“Currently, there are cases where Chinese import companies are cancelling orders due to port closures and hence Zimbabwe’s exports to the country are affected,” ZimTrade says in the March 2020 Trading Post.
“With China having shut down its manufacturing centres and closed its ports, there will be a resultant decrease in demand for the Zimbabwean products. At the same time, closed borders in China means Zimbabwean manufacturers that rely on raw materials and other consumables from China will be affected and the spiral effect of reduced manufacturing in China will have a toll on Zimbabwean industries.”
ZimTrade says going forward, it is important for local companies to start considering locally produced raw materials that can support businesses rather than relying on imports.
“This can be easily achieved is stronger linkages are created between suppliers and buyers so that they can strike a balance between supplying the quality
products and right prices,” the organisation says.
“This import substitution will allow the country to create employment and at the same time preserve the scarce foreign currency. Going forward, it is important for local companies to start considering locally produced raw materials that can support businesses.”
Zimbabwe mainly imports raw materials and machinery for production purposes which will then be used to manufacture different products some of which are exported according to the organisation that facilitates trade in the African country.
Chamber of Mines of Zimbabwe has already revealed that the mining industry lost US$200 million in revenue as an effect of COVID-19, due to the stronger ties the sector has to regional and global trade.
China’s economy is, however, recovering from the changes the Asian country faced during the first two months of 2020, where COVID-19 resulted in cities locking down.