LOCAL manufacturers are calling for more targeted and balanced industrial policies, saying rising production costs, counterfeit imports and regulatory distortions are undermining local industry and weakening the country’s value addition ambitions.
The concerns emerged during a recent business membership organisations (BMOs) engagement with Industry and Commerce Minister Nqobizitha Mangaliso Ndlovu, where the Zimbabwe National Chamber of Commerce (ZNCC) tabled a series of policy recommendations aimed at strengthening industrial competitiveness and protecting domestic production.
Among the key issues raised were the structure of the sugar tax, import licensing under Statutory Instrument (SI) 59 of 2026, the growth of counterfeit products and the classification of value-added mineral products under existing beneficiation frameworks.
Zimbabwe National Chamber of Commerce
In its submissions, the ZNCC said industrial policy must support productive sectors without creating unintended distortions across manufacturing value chains. “The chamber recognises the dual objectives behind the sugar tax: to promote public health and to support local industry,” the organisation said.
“However, the current structure and application of the tax have created distortions across the value chain, affecting both producers and downstream manufacturers.”
The business lobby group argued that while taxation measures may have broader policy intentions, uneven treatment between locally manufactured products and imports risks disadvantaging domestic producers.
“Where imported finished products or substitutes are not equivalently treated, the result is an uneven playing field that disadvantages domestic producers and undermines value addition,” the chamber said.
The ZNCC raised concern over import licensing requirements introduced under SI 59 of 2026 covering footwear imports, saying current domestic production capacity remains limited.
“The chamber notes the introduction of import licensing requirements on footwear under SI 59 of 2026. While we fully support the objective of promoting local industry, there are concerns around the timing and sequencing of this measure,” it said.
According to the chamber, the leather and footwear sector currently lacks sufficient upstream industrial capacity, including active tanneries, to fully meet local demand.
“As a result, the measure may increase costs, slow procurement processes and reduce the ability of businesses to meet consumer demand, particularly in segments where local substitutes are not yet available,” the organisation said.
The chamber said there was need for a “review of the industrial and beneficiation classification framework” to ensure that regulatory treatment reflects actual levels of processing and manufacturing.
It also called for stronger enforcement against counterfeit distribution networks and greater coordination between regulatory authorities, standards agencies and law-enforcement institutions.
Industrialist Dr Nxaba Ndiweni said industrial policy works best when it is aligned with productive capacity and long-term competitiveness. “Protecting local industry is important, but industrial protection alone cannot substitute productivity,” he said.
“What manufacturers need is a policy environment that lowers the cost of production, supports investment in machinery and technology, and creates stable market conditions.”
Dr Ndiweni said Zimbabwe’s industrial strategy should increasingly focus on value addition and regional competitiveness under the African Continental Free Trade Area (AfCFTA).
“If local firms are to compete regionally, they must be supported through infrastructure, energy reliability, efficient logistics and access to affordable capital,” he said.
Industrial analyst Mr Evans Kaome said the concerns raised by business reflected broader structural challenges affecting manufacturing performance.
“There is growing pressure on manufacturers from multiple fronts — compliance costs, counterfeit products, imported substitutes and currency-related cost pressures,” he said.
“Industrial policy, therefore, needs to become more coordinated and evidence-based rather than reactive.”
Mr Kaome said counterfeit and substandard products had become increasingly significant for formal industry.
“Counterfeits distort markets because compliant businesses carry the cost of taxes, standards and quality assurance while illegal operators bypass those obligations,” he said.
The ZNCC said counterfeit goods continue to undermine compliant businesses and erode confidence in formal markets.
“Counterfeits distort pricing, erode brand value and expose consumers to unsafe and inferior goods,” the chamber said.
“The result is a market where illegitimate operators gain at the expense of productive industry.”
Economist Mr Tinevimbo Shava said Zimbabwe’s industrialisation drive would require policies that simultaneously encourage investment, competitiveness and domestic production. “Industrial policy should ultimately aim to expand productive capacity rather than simply restrict imports,” he said.
He added that value-addition policies needed to reflect the realities of modern industrial production systems.
“One of the challenges highlighted by industry is that some processed products are still classified as raw minerals despite undergoing substantial beneficiation,” he said.
The ZNCC noted that products such as dolomite, calcium carbonate and talc, after mechanical processing into ultrafine powders, remained classified as unbeneficiated minerals despite representing the final stage of value addition.
Similarly, processed steel products continued to fall within mineral frameworks, limiting access to industrial incentives and export support mechanisms, according to the chamber.
Mr Shava said correcting such classification issues could help encourage downstream manufacturing and improve export competitiveness.
The chamber said there was need for a “review of the industrial and beneficiation classification framework” to ensure that regulatory treatment reflects actual levels of processing and manufacturing.
It also called for stronger enforcement against counterfeit distribution networks and greater coordination between regulatory authorities, standards agencies and law-enforcement institutions.
The BMOs’ engagement formed part of ongoing dialogue between the Government and the private sector, focused on improving industrial policy coordination, strengthening local production and advancing Zimbabwe’s broader industrialisation agenda.-herald
