Competitiveness Summit kicks off: Set to address informal sector challenges

THE National Competitiveness Commission (NCC) inaugural annual Competitiveness Summit kicks off in Bulawayo amid hopes the platform will provide solution-based resolutions to creating a fair level-playing field where business operations across sectors are integrated to drive mutual economic gains.

President Mnangagwa is expected to grace the event tomorrow during which he will interact with industry leaders and other key stakeholders.

Organisers have said the event provides a dynamic convergence of public, private, development partners, academia and other non-state actors to engage in dialogue and develop sustainable reforms and resolutions that will improve productivity and competitiveness.

Zimbabwe Chamber of Commerce vice president for Matabeleland Chapter, Mr Louis Herbst, said the Competitiveness Summit presents a crucial opportunity to address the challenges posed by the informal sector while fostering a more competitive environment for formal traders.

“It’s essential to recognise the contributions that informal traders make to our economy. Rather than simply pushing them out, we should develop educational programmes that help them understand the value of their businesses and the benefits of operating legally,” said Mr Herbst.

“By providing resources and support, we can encourage these vendors to formalise their trade, which in turn can enhance their sustainability and profitability.

“Moreover, we need to address the role of the formal sector in this equation. It’s important for formal businesses to discourage practices that support the informal sector as this can create a reverse effect that ultimately impacts their operations.”

Mr Herbst said the Government is putting measures in place to combat smuggling and other illegal activities and businesses should collectively accept that these changes would not happen overnight, urging the industry to support these initiatives for long-term stability.

He said it can be a bitter pill to swallow as many in the industry have become accustomed to adapting and seeking out loopholes to maximise profits.

However, Mr Herbst said it was time everyone treat Zimbabwe as their home.

“We must revisit our foundational values and support the country’s development rather than operating as if we’re planning a mass exodus,” he said.

“This mindset encourages short-term accumulation of wealth without considering the long-term impacts of our actions on the economy and society at large.

“I hope the summit will lead to actionable strategies that not only address the challenges of the informal sector but also promote a collaborative approach to building a more robust and competitive economic environment for all stakeholders.”

The event is expected to serve as a powerful tool for building national consensus on enhancing the country’s global competitiveness and fostering collaboration, innovation and adaptability among stakeholders.

Confederation of Zimbabwe Industries Matabeleland Chapter president, Mr Stephen Ncube, said industry expects discussions on improving the ease of doing business with emphasis on regulatory costs.

He said over the past decade, the economy has been beset by escalating regulatory costs and licensing requirements thereby significantly undermining competitiveness.

“Regulatory costs account for 20 percent of the total overheads. This is evident in the decline of domestic market share to imports and the loss of export markets for locally manufactured goods,” said Mr Ncube.

“As the industry, we strongly advocate for a reduction of the regulatory costs.

“Electricity charges went up in 2024 so much that this became strenuous to industry. Charges went up by between 75 percent and 100 percent. Industry has proposed a tariff reduction roadmap from 17cents per kilowatt-hour to nine cents per kilowatt-hour to enhance competitiveness.”

He said the industry expects the Summit to interrogate tariffs charged by city councils and recommend tariffs that are sustainable for the industry to attract investment-chroncile