Zim firm struggles to export US$750 000 cotton due to permit issuance delays

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By Alois Vinga

ZIMBABWE’S second largest local cotton firm, Southern Cotton Company (SCC) says it is holding on to cotton lint worth US$750 000 which is long overdue for exportation owing to the time-consuming process of getting export licences from government.

Speaking to on the sidelines of a media tour in Shamva Friday, SCC managing director, Caos Nzenze said the company was sitting on a huge consignment which could have earned the country much-needed foreign currency.

“It is taking us a long period of time before we get the export permits needed for us to export cotton lint.

“What normally happens is that when we apply for the permits, we do not get a bulk permit because government breaks it into smaller numbers and the one we normally get only lasts three months,” he said.

He said the company has been failing to process its orders before the expiry of the export licences due to rampant electricity outages.

“So, while the Agriculture Ministry is very quick and supportive, we tend to experience these delays from the Industry Ministry who are also charged with the responsibility to issue the permits,” Nzenze said.

The development comes at a time when Zimbabwe has moved 15 places up, to becoming number 140 out of 190 countries on the World Bank’s ease of doing business index.

Several exporters have bemoaned the existence of numerous licensing and associated fees required by government departments in Zimbabwe saying they remained a barrier to the ease of doing business.

Zimbabwe National Chamber of Commerce president, Tamuka Macheka has since bemoaned the existence of numerous licensing fees and time consumed during exportation, pointing out that when taking goods outside Zimbabwe, 99 hours is spent on documentary compliance and an additional 88 hours are spent on border administration.

He said in terms of export associated costs, US$170 is spent on documentary compliance while US$285 is spent on border administrative compliance.

“On the imports side, 81 hours are spent on documentary compliance while 228 hours are spent on border compliance while US$150 is spent on documentary compliance while US$562 is spent on border compliance,” he said.

Industrialist and former CZI president, Sifelani Jabangwe described the multiple licencing regime as a great barrier to the ease of doing business which is bleeding the nation’s manufacturing sector.

“So, one would realise that most government departments are now crafting these licences as fundraising projects and if all these funds are remitted to treasury, I do not think that they will be as costly and time consuming as they are,” he said.