Zim firms operating at third of capacity: survey

HARARE – Zimbabwean companies are operating at a third of their capacity as a foreign currency crunch hampers imports of spares and raw materials, an industry survey released yesterday said.

“The average capacity utilisation for sampled firms was 33.8 per cent (down from 35.8 per cent in the previous survey in 2005),” said the Confederation of Zimbabwe Industries (CZI) survey. “We have de-industrialised ourselves,” CZI president Callisto Jokonya told guests at the launch of the report.”There is a crisis.We no longer have an industry to talk about.”He said controls imposed by veteran President Robert Mugabe’s government to rein in galloping prices were not working.The CZI report said 49 per cent of the sampled firms operated below 50 per cent capacity with only 9.7 per cent operating at above 74 per cent.The industry body said the decline was exacerbated by chronic shortages of fuel and frequent power cuts.”In fact, 84 per cent and 89 per cent of the sampled firms stated that power cuts and fuel shortages had serious negative effects on their operations.”CZI added that business confidence had dipped to five per cent as investors grew increasingly pessimistic about the state of an economy ravaged by inflation now believed to have breached 4 500 per cent.Zimbabwe is in the eighth year of a recession, characterised by the world’s highest rate of inflation, 80 per cent unemployment, chronic shortages of foreign currency and of basic goods such as fuel and the staple cornmeal.Nampa-AFP”We have de-industrialised ourselves,” CZI president Callisto Jokonya told guests at the launch of the report.”There is a crisis.We no longer have an industry to talk about.”He said controls imposed by veteran President Robert Mugabe’s government to rein in galloping prices were not working.The CZI report said 49 per cent of the sampled firms operated below 50 per cent capacity with only 9.7 per cent operating at above 74 per cent.The industry body said the decline was exacerbated by chronic shortages of fuel and frequent power cuts.”In fact, 84 per cent and 89 per cent of the sampled firms stated that power cuts and fuel shortages had serious negative effects on their operations.”CZI added that business confidence had dipped to five per cent as investors grew increasingly pessimistic about the state of an economy ravaged by inflation now believed to have breached 4 500 per cent.Zimbabwe is in the eighth year of a recession, characterised by the world’s highest rate of inflation, 80 per cent unemployment, chronic shortages of foreign currency and of basic goods such as fuel and the staple cornmeal.Nampa-AFP