SOUTH African businesses are piling pressure on the authorities to impose retaliatory trade measures on Zimbabwe following the promulgation of the law restricting imports of goods that can be manufactured locally, The Herald Business can reveal.However, the Confederation of Zimbabwe Industries said it would be “reckless” for Zimbabwe “to back down” given how the restrictions have helped resuscitate companies. It said while the measures were temporary, Government should not “immediately” reverse the policy considering the benefits already accrued from imports restrictions.
In June, Government invoked SI 64 of 2016, which temporarily regulates importation of certain products that can be produced locally to boost capacity of local firms. Some of the products, which were removed from Open General Import Licence include mayonnaise, salad cream, peanut butter, jams, maheu, canned fruits, vegetables, pizza, yoghurts, flavoured milks, dairy juice blends, ice creams, cultured milk, cheese, coffee creamers, camphor creams, white petroleum jellies, body creams and plastic pipes.
The legislation also controls importation of second-hand tyres, urea and ammonium nitrate fertilisers, tile adhesives and tylon, shoe polish and synthetic hair products. Goods categorised as builder-ware products including wheelbarrows (flat pan and concrete pan wheelbarrows), roofing frameworks, pillars, columns, balustrade, shutters, towers, masts, roofs and roofing framework are also part of the restricted
Following the promulgation of the law, some companies have significantly increased capacity utilisation, with some operating at full capacity. Zimra also recorded a marginal increase in tax collections resulting from increased production.
While the SI 64 conforms to SADC trade rules, the South African businesses affected by the regulations are piling pressure on its government to impose retaliatory measures. SA is Zimbabwe’s largest trading partner and imports most of the goods from its neighbour.
The matter dominated preparatory meetings of the launch of the Bi-National Commission, a high level forum of co-operation between Zimbabwe and SA, aimed at fostering economic development and uplifting livelihoods of people in the respective nations.
The Bi-National Commission, signed by President Mugabe and his South African counterpart Jacob Zuma last week, is an elevated instrument through which political and economic relations between the countries would be monitored at presidential level.
CZI president Mr Busisa Moyo said there had been some reactions from South Africa and Zambia after the Government imposed import restrictions on certain commodities.
“There had been a lot of pressure but we have seen the gains of the restriction. They are temporary but we don’t expect an immediate action (by the Government) to reverse the policy. We will be reckless to do that. Companies have invested on the back of the SI 64, companies have raised capacity and jobs have been created. As you are aware, we have so many Zimbabweans living outside the country because there are not enough jobs. So if we want to create jobs, we have to increase production,” said Mr Moyo.
“We are not so sure what kind of retaliatory measures they are pushing for, but it is a subject that dominated the meetings prior to the signing of the Bi-National Commission,” well placed sources told The Herald Business.