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Industry demands decentralisation

INDUSTRY players in Bulawayo have called on the government to decentralise services such as the issuance of import and export permits as a way of reducing operating costs for companies outside the capital.

BY MTHANDAZO NYONI

Currently, almost all permits are processed in Harare, a development that has seen companies across the country incurring unnecessary costs to secure the documents.

Captains of industry told Standardbusiness last week that the issue needed to be dealt with urgently.

“This [centralisation of services] increases costs of operating out of Bulawayo as one can be in Harare for three to four days every week at a time.

“That amounts to 12 to 16 days a month out of 22 working days on average.

“In this regard, companies in Bulawayo, Gweru and Mutare or [other towns] outside Harare are disadvantaged,” said Confederation of Zimbabwe Industries (CZI) president Busisa Moyo.

One of the ministries whose services needed to be decentralised was that of Agriculture which issued all permits from Harare, Moyo said.

He said they would continue lobbying for government to be fully represented in Bulawayo and be able to issue permit documents or create a system that reduced the frequency of permit-related visits to Harare.

“For example, [one way of going round it is to] give longer dated permits instead of ones that expire in three months or working on a return and inspection system where companies are given an annual licence.

“They would be expected to account for their imports and to file documents and a single annual fee would be charged as opposed to paying for each permit,” he said.

“It is implausible why an 85 year old company [like United Refineries Limited] that has been in the same line of business using the same suppliers for the last 15 years needs to apply for a permit monthly and submit company documents every three months.

“These are some of the things that make doing business in Zimbabwe costly and difficult.”
Only the ministry of Industry and Commerce has successfully decentralised the issuance of licences which can now be procured in Bulawayo, Moyo said.

Association for Business in Zimbabwe chief executive officer, Lucky Mlilo voiced the same concerns. He said there were many permits required to run a business in Zimbabwe and this called for the decentralisation of decision making.

“We have also been raising various issues around the high cost of manufacturing in Zimbabwe that renders us uncompetitive in the region,” he said.

“The country is just not ready for investment. Apart from some regulations that are a disincentive anyway, it’s almost impossible to get things done on the ground.

“There is urgent need for a proactive approach if we are ever going to see the resuscitation of our industries and business at large.”

Mlilo said government should tap into the thriving informal sector.

“Simply put, the informal operator does not carry the costs-overheads and tax burdens that the formal sector competitor does,” he said.

“It is common cause that this sector does not contribute, in any meaningful way, to the fiscus or the much-needed circulation of funds in the correct channels.

“A financially strapped government, by its own admission, ignores this source of revenue at its own peril.

“The situation of diminished returns, which prevails in terms of revenue, must result in higher taxes, levies and such.

“No business can be expected to absorb and operate in the current depressed environment. I believe India was or is successful in this same direction.”

Mlilo said since Bulawayo was seen as a depressed economic industrial city, he recommended a more visible and active command post be established for ease of liaison — even for an initial three month period.

He said the post should be manned by decision makers or at least those that attended to decision-making processes.

“I also suggest that an independent body be established to review all businesses in distress to assess their positions and make recommendations,” Mlilo said.

“This review audit should be at no cost to the businesses and the report recommendations should be seen as credible and bankable.”

Zimbabwe National Chamber of Commerce first vice-chairperson for Bulawayo chapter, Sisa Sibanda concurred, saying this year they would work “tirelessly to create interactive platforms for our members and the business community to interact with potential investors, government and stakeholders with the hope of creating synergies that will revive or create new businesses”.

She said revival was not practical in all sectors and as such, industries thrived better in value chains as propagated by CZI.

“Several interlinked industries must thrive simultaneously for them to be viable,” she said.

“Availability or smooth accessibility of raw materials supported by functional infrastructure, consistent, positive policies and stable or predictable economic policies and economic behaviour, are key to a vibrant industry.”

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