Exports hit record high in Nov 2022

Sales of Zimbabwean exports hit a six-year monthly high in November last year with tobacco and gold among the major contributors, figures from the Zimbabwe Statistics Agency (Zimstat) show.

Business Weekly had access to Zimstat’s trade figures going back as far as January 2017 with the US$674,6 million export earnings in November 2022 as the highest.

The US$647, 6 million recorded in the month of November 2021, is the second highest.

While tobacco with US$171 million worth of exports, and gold with US$183 million worth of exports remained the highest contributors to the total outturn, gains made elsewhere boosted the overall earnings.

Of note, were exports in raw hides and skins, fresh or preserved, not tanned, where export earnings reached US$3,2 million but significantly higher than the monthly average of US$1,6 million.

Exports of soya bean also doubled to $1 million.

President Mnangagwa is on record saying there is need for increased diversified exports of value-added goods and services as opposed to reliance on the exportation of primary commodities.

Through National Development Strategy 1 (NDS1), President Mnangagwa’s administration plans to increase the contribution of value-added exports to total exports from 9 percent in 2020 to 20 percent by 2025.

The goal is to gradually improve the contribution of the value-added exports to total exports from US$727.47 million in 2020 to about US$1,337 billion in 2025, according to NDS1.

Commenting on the continued growth in exports, Allan Majuru, CEO of national trade development and promotion body, Zimtrade, said the re-engagement agenda is bearing fruits as is it creating space for Zimbabwean companies to engage with buyers in traditional and non-traditional markets.

“Activities such as outward seller missions and inward buyer missions have increased exposure for Zimbabwean products, creating interest from the region and beyond.

“The increased interest in Zimbabwean products has led to diversified export destinations and seen Zimbabwean products penetrating non-traditional markets such as Belgium and Dubai, resulting in Dubai becoming second largest export destination market,” Majuru said.

Zimbabwe’s exports to non-traditional markets in particular have witnessed unprecedented growth with products finding new markets in countries such as the United Arab Emirates (UAE), China, Belgium, and Italy.

Exports to Romania and Namibia at US$1,7 million and US$3,3 million were at their highest for the six-year period from January 2017.

The country hardly exports to Luxembourg and Korea but for November, it exported goods worth $7,4 million and US$1,9 million to the two countries respectively.

Exports to India improved from their previous high of $2,7 million to US$4,6 million during the six-year period.

Other record exports were to countries such as Croatia, Spain Germany and Egypt.

The surge in exports is good economic news for President Mnangagwa, who faces re-election this year.

The growth in exports is testimony to the tremendous effort his administration has placed on export-led growth.

The National Trade Policy has in place plans to grow exports to US$7 billion by 2023. By end of November 2022, exports had hit US$6 billion.

In 2019, while officially opening the ZimTrade Annual Exporters Conference in Bulawayo, President Mnangagwa called on exporters to leverage the “engagement and re-engagement policy to explore and reignite markets in all parts of the world, such as China, Russia, Europe and Britain among others”.

“We must work with the unity of purpose to facilitate trade and investment as well as ensure trade policy predictability and sustainability.

“To realise sustainable export growth, we can no longer afford to work at a slow pace; everyone has to move with speed in their areas of responsibility. As government, we shall continue to play our part; industry and commerce must also play theirs,” he said then.

Majuru said the continued export growth comes after concerted efforts by the Government, spearheaded by the ministry of foreign affairs and international trade have worked in strengthening visibility of Zimbabwean products across borders.

Trigrams Investment market analyst, Walter Mandeya, said the fact that this was achieved at a time the world is struggling with serious economic problems and Zimbabwe still under illegal sanctions shows that Zimbabwe is not a country that is crushed by crises, but a country that manages crises.

However, as exports grew to record highs, so did imports.

For the month of November 2022, the import bill stood at US$797,9 million, the highest in six years and also higher than export earnings for the month under review.

Overall, between January and November 2022, the import bill reached US$7,9 billion, more than exports of US$5,9 billion. This resulted in a trade deficit of approximately US$2 billion.

Economist, Chenayi Mutambasere, said there is a positive relatedness between imports and exports.

She said because Zimbabwe is an import-based economy, the domestic market relies on imports even for basic commodities such as grains and raw materials.

“Much of what we produce relies on imported raw materials. With this, our trade balance will continue to remain low if not in deficit,” she said.

Mutambasere said there is now need “to adjust the demand side to reduce imports so that these (export) gains can make a significant overall contribution to our trade balance.”

She, however, said the growth in both exports and imports needs “to take into account prices too.”

The November import bill for mineral or chemical fertilisers, potassic at US$20,1 billion was 62 percent higher than the previous monthly high of US$12,4 billion recorded in May last year. This could be a combination of higher imports by quantity or higher global fertiliser prices.

Zimbabwe imported dishwashing machines worth US$11 million in November last year. Before that, the average monthly import bill for such items was US$1.1 million.

There were also record spends in items like electrical transformers, electric generating sets, and machinery for sorting stones and ores.

The global fertiliser prices saw a sharp spike since early 2022, triggered by Russia-Ukraine conflict, leading to supply disruptions and a higher import bill.

The period under review saw global prices rise by more than 8 percent on average, sparked by the conflict in Ukraine and “zero-covid” restrictions in China.-ebusinessweekly