Exploit regional, global value chains: WB
THE World Bank has urged Zimbabwean companies to exploit opportunities in regional and global value chains to buttress the country’s efforts to expand investment and employment creation.
As Zimbabwe is focused on transforming its economy towards an upper middle-income status by 2030, the World Bank says connecting local businesses with regional and international value chains is critical.
Speaking during a recent Trade Tariff Conference hosted by Competition Tariff Commission (CTC) in Bulawayo, World Bank economist in the country, Dr Marko Kwaramba, said platforms such as the African Continental Free Trade Area (AfCFTA) give greater opportunity for Zimbabwean businesses to participate in regional and global value chains.
“Once the country participates in the regional and global value chains, evidence shows that it will bring investments, equipment and foreign direct investments, hence more economic development,” said Dr Kwaramba.
“For example, various countries that have been participating in the global value chains, one of them is Mexico. If you look closely, because of its participation, it has created about 12 million jobs and Lesotho again because of its participation, has 10 percent of its employment coming from the global value chain.”
Dr Kwaramba said statistics show that once a country participates in the global value chain, there is a tendency to expand its business footprint as opposed to a decline.
He said Zimbabwe stands a chance to scoop the same opportunity as it seeks to reboot its economy.
Regional value chains refer to cross border production system within the same economic bloc while global value chains refer to joint production between countries of different economic blocs.
Africa Continental Free Trade Area (AfCFTA)
The, which came into force last year, is a historic agreement that enables African countries to venture or increase the member states participation in global value chains as well as regional value chains. Dr Kwaramba also urged local businesses to grab the opportunity in exportation of services.
“Global evidence shows that services exports are critical but in Zimbabwe it’s only travel and tourism that dominate the services export,” he said.
“And it’s only two percent that comes from all the services that the countries export but evidence shows that there is a great opportunity with India as an example.”
He said Zimbabwe being a country with the highest educated population there is an opportunity in exporting services as the country has engineers, accountants that could create greater benefits when participating in the AfCFTA. –chronicle.co.zw
