Zim retailers concerned with rampant smuggling

Published: 06 September 2018

THE confederation of Zimbabwe Retailers (CZR) says it is concerned with the rampant smuggling of goods, which has become a threat to the country's industrialisation process.

Denford Mutashu, the confederation's president, said government's red tape in acquiring export and import licenses was fuelling the illegal practice.

"If you look at the amount of smuggling taking place right now, it is a real threat to industrialisation and the local industry," he said.

Government recently came up with a number of interim measures aimed at resuscitating the local industry, whose performance had been immensely affected by the influx of imported products.

The most notable intervention was the removal of products from the Open General Import Licence through gazetting several Statutory Instruments (SIs) such as SI 64 of 2016, now SI 122 which regulates the importation of selected products.

However, despite the market -driven policies by government smuggling significant increased last year resulting in the country losing at least $2,5 billion on the back of porous ports of entry, according to a report by the Zimbabwe National Chamber of Commerce.

Mutashu also highlighted the country's unfair cost structure that has seen a lot of companies closing business.

"The pricing in Zimbabwe had a lot of connotations and narratives and at the end of the day, it is not a fair price. The cost of a locally manufactured shirt in Zimbabwe is $30, but for $30 you will have four or five smuggled shirts from China.

"As long as our house is not in order, as long as the housekeeping issues that we need to sort out before we even think of trading with other countries are not in order, it is going to be very difficult for us to plan forward because we do not even know how much is being pushed in the informal trade," he said.

Government acknowledged that despite the introduction of interim measures to protect local industry, challenges such as the continued appetite for imports by consumers, poor quality and delays in delivery of goods by the local producers due to less competition from imports were some of the negative effects of the Statutory Instruments.

To address the challenges of the threat of retaliation from trading partners, the government will replace the import management programme with a Local Content Policy.

- fingaz

Tags: Retailers,