Bonded warehouse facility for firms

The Chronicle

Oliver Kazunga/Prosper Ndlovu, Business Reporters
GOVERNMENT will support exporters in setting up bonded warehouses in the country to improve access to raw materials as part of measures to increase domestic production and expand the job market, the Minister of Finance and Economic Development, Professor Mthuli Ncube, has said.

In light of the prevailing foreign currency shortages, local manufacturers have in the past expressed concern over operational constraints, chief among which is lack of access to raw materials.

On Friday Prof Ncube, who was accompanied by his Permanent Secretary, Mr George Guvamatanga, had a tour of Monarch Steel, a division of Treger Group in Bulawayo where he was briefed about the company’s milestones and constraints.

“On the sidelines of the pre-Budget seminar, we visited Monarch Steel in Bulawayo, part of Treger Group — one of Zimbabwe’s key companies employing 2 900 workers, turnover of $19 million a month and exports of $1.1 million a month,” Prof Ncube later posted on his Twitter account.

He was impressed that Monarch Steel has recently commissioned a state-of-the-art steel production plant with modern production organisation and factory-floor management techniques.

“Monarch requires support in commissioning its bonded warehouse and speeding up of raw material imports through the border posts. As we grow our economy, we will continue to focus on retooling our industries, production and creating jobs,” said Prof Ncube.

He told Business Chronicle in an interview after the tour that the Treger Group has already made an application seeking Zimra approval for the bonded warehouse as a measure to avert delays in accessing raw materials.

“Of course Zimra falls under me so that’s why I was alarmed. So, I will make sure that this is resolved but also resolved for a lot of others who have applied for similar dispensations and there have been delays,” said Prof Ncube.

He said the Government through his Ministry would give the necessary support to industry to facilitate economic growth through employment creation and growing exports. Prof Ncube said companies such as Treger Group, required Government support to make sure they were able to access their forex.

“Of course, there are competing demands but we want to make sure that a major player like this is well supported. Secondly they (Treger Group) have certain needs because easily 90 percent of their inputs are imported.

“We don’t make flat steel here, they have to import it from places like South Africa and others so really the efficiency of the border posts is a concern,” he said.

The Treger Group is a significant investor and employer in Bulawayo and Zimbabwe in general.

During the tour, Prof Ncube said management also told him that some of their consignments were taking up to three weeks to pass through Beitbridge.

This, he said, was totally unacceptable and pledged together with his team to assess the situation and facilitate faster movement of imports to support production.

The Minister also said Treasury was negotiating for an undisclosed amount of offshore funding to facilitate the retooling of local firms.

One of the major hindrances to boosting productivity by the manufacturing sector is lack of working capital for retooling as most of the factory equipment was obsolete.

Monarch Steel Managing Director Mr Fritzpatrick Mawovera told Prof Ncube that Treger Group was proud of its economic contribution to Bulawayo.

“We really pride ourselves as Treger Group as forming part of the cornerstone of the Bulawayo economy. We are pivotal really in terms of employment and with your continued support, obviously we can grow the numbers,” he said.