By Alois Vinga
ZIMBABWE’s manufacturing sector capacity utilisation increased to 66% for the fourth quarter of 2021 amid indications of high optimism on economic rebound across the industry, Zimbabwe National Statistics Agency (Zimstat) quarterly Business Tendency Survey (BTS) has established.
Undertaken with the objective of producing indicators for use in monitoring current business situation and short-term developments in the sector, the 2021 fourth quarter BTS shows high industrial performance.
“Capacity utilization for fourth Quarter 2021 was 66%, representing a one percent increase from the third quarter value of 65% with the Purchasing Managers’ Index (PMI) standing 50,7%, representing a 10% point increase from 40,7% recorded in the third quarter,” said the survey.
Established remarkable performance resonates with broad based economic reforms incepted in 2018 which have also contributed significantly to a cutback in yearly inflationary pressures from a high of 837% reached in 2020 to the current 60, 6%.
The increase is also consistent with the level of support which industry has been receiving through the Reserve Bank of Zimbabwe (RBZ) foreign exchange auction which to date has disbursed over US$2,5 billion to support the productivity cause.
The findings also come shortly after the acknowledgement by the International Monetary Fund (IMF) confirmation of the impact of Zimbabwe’s economic reforms amid projections that the economy will grow by 3,5% this year.
The ‘Drinks, Tobacco and Beverages’ industry group recorded the highest capacity utilization value of 79%, as the ‘Other Manufactured Products’ group booked the least utilisation value of 15%
Food Stuffs sector recorded a 2 % growth, textiles and ginning sector 7% growth, clothing and footwear 1% growth, metals and metal products 1% growth.
A few sectors such as the wood and furniture, paper publishing, chemicals and petroleum recorded slight declines partly attributed to seasonal shifts among other reasons.
The proportion of the surveyed manufacturers reporting an increase in production levels over the past three months was 37% with overall balance of opinion for production level in relation to the past three months being 19%.
“The three major constraints to production as cited by respondents were: shortage of raw materials 52%, cash flow difficulties 48% and uncertainty towards the economic environment 48%. The same were also cited as major constraints in the third quarter,” the survey said.
The survey shows that the benefits of the gains have resulted in 28% of the survey respondents viewing total employment in the past three months as having increased, while 64% remained neutral.
“Regarding total employment in the next three months, 30% of the respondents anticipated the variable to improve, as 63% expected no change,” the survey added.
