Local manufacturing sector capacity surges to 56.5 pc

Zimbabwe manufacturing sector’s capacity utilisation for 2021 grew to 56, 52 percent from 47 percent in 2020 spurred by notable investments by companies.

The 56, 25 percent growth in manufacturing sector capacity utilisation is the highest in 10 years after a 57, 2 percent growth in 2011 owing to efforts being directed towards making the country a production hub again.

In 2020 capacity utilisation stood at 47 percent from 36, 4 percent in 2019. According to the survey $147 million (mainly sourced from the Reserve Bank of Zimbabwe’s forex auction) was the total amount of investment made by local companies in the year as they sought to increase capacity while additional capacity of 25, 6 percent was created in the year.

At least 37, 8 percent of the manufacturing sector engaged in capital expenditure to increase their production capacity in 2021.

About 56 percent of the surveyed firms registered growth in output while 26 percent saw a decrease in the year.

At least 18 percent remained flat as their output neither increased nor declined. The drinks and tobacco segment had the foremost growth in output at 82 percent, followed by the wood and furniture sector.

Other notable growth was seen in the chemicals and petroleum segment, which recorded a 64 percent growth followed by the clothing and footwear whose output grew by 60 percent.

“The total amount of investment that was carried out in 2021 to increase capacity by surveyed firms amounted to $147 million.

“According to the survey 37, 8 percent of the manufacturing sector undertook investments to increase their production capacity in 2021,”

According to the survey 37, 8 percent of the manufacturing sector undertook investments to increase their production capacity in 2021,” said Confederation of Zimbabwe Industries Chief economist Dr Cornelius Dube.

The paper printing and publishing sector had the highest additional capacity at 50, 6 percent followed by the chemicals and petroleum products segment at 30 percent.

Notable efforts towards adding capacity were made in the non–metallic mineral products and the drinks – tobacco segments which recorded 29 percent and 28 percent growth respectively.

However, according to the CZI survey inclusion of small-scale players weighed down capacity utilisation.
The reported noted that at least 19,19 percent new jobs were created in the year against 16 percent that was retrenched.-eBusiness Weekly