Palpable fear has gripped workers across the country as more companies continue to lay off large numbers of their staff, a direct consequen...
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Palpable fear has gripped workers across the country as more companies continue to lay off large numbers of their staff, a direct consequence of the prevailing tough economic situation in the country.
Latest figures from the Reserve Bank of Zimbabwe (RBZ) revealed that nearly 3 000 people lost their jobs in the nine months to September 2016 with the figure expected to reach 5 000 by the end of the year.“A total of 1 175 retrenchments were witnessed, during the third quarter of 2016, compared to 1 340 in the comparative period in 2015,” the central bank said in its recent quarterly report.
According to data obtained from the Master of the High Court, a total of 14 companies were placed under judicial management, while 20 were liquidated during the third quarter of 2016.
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| RBZ Premier |
“Most liquidations witnessed were in the manufacturing sector,” the apex bank said. The Zimbabwe Congress of Trade Unions secretary-general Japhet Moyo said unless the government revises its anti-investment policies, workers will continue to lose their jobs as many companies close shop.
“We witnessed a lot of job losses and company closures that went unabated in 2016. The numbers were going up. Our agriculture sector did not do well in 2016 and it was very bad,” he said. Moyo said the Indigenisation Act, which compels foreign-owned firms to cede 51 percent shareholding to locals, should be scrapped or revised, as it was chasing away potential investors.
In light of the worsening economic conditions, the RBZ noted that the manufacturing sector was projected to grow by 0,3 percent in 2016, on account of expected improvements in capacity utilisation in some sub-sectors.
This is, however, in sharp contrast to the Confederation of Zimbabwe Industries (CZI) manufacturing survey which said capacity utilisation in the sector had increased from 34,3 percent in 2015 to 47,4 percent this year.
Capacity utilisation was at 43 percent in 2010 before increasing to 57,2 percent in 2011. It, however, started a downward trajectory from 2012, sliding to 44,2 percent and further down to 39,6 percent in 2013 and 36,3 percent in 2014.
This had forced government, facing an increasing current account deficit due to widening annual trade deficits, to intervene by banning the import of at least 100 products to save local companies and boost productivity.
The promulgation of Statutory Instrument 64 (SI 64) of 2016, in addition to Statutory Instrument 18-20 (SI 18-20) of 2014/15, which removed more goods that are locally available from Open General Import Licence exemption, was expected to promote domestic production of basic and essential commodities and create scope for enhanced industrialisation.
The RBZ noted that the positive impact of the SI 64 of 2016 has been reported in sub-sectors such as baking, fruits and vegetables, iron and steel fabrication, pharmaceuticals, oil expressing, and furniture manufacturing.
“Results from the retail surveys conducted by the Industry and Commerce ministry during the quarter under analysis showed that shelf space occupancy was around 70 percent and 30 percent for locally-produced goods and imported goods, respectively,” the central bank said. - Daily News
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