Zimbabwe, Botswana scale up trade, investment synergies

ZIMBABWE and Botswana continue to reap fruits of improved bilateral trade relations as they seek increased synergies towards unlocking mutual business opportunities including tapping into the wider African market.

Zimbabwe and Botswana enjoy cordial bilateral ties since pre-independence times, which have been amplified under the Second Republic led by President Mnangagwa.

President Mnangagwa

The close collaboration has culminated in the establishment of a bi-national commission (BNC) in 2019, which has paved the way for the signing of numerous cooperation deals covering various socio-economic and political aspects.

Already, the two countries have a bilateral trade agreement that is governed by Statutory Instrument (S.I.) 192 of 1988, which allows preferential treatment of goods originating from the two neighbouring states, that is, goods grown, produced or manufactured from both nations.

Under this deal goods originating from either of the trading partners are exempted from payment of customs duties on condition that the goods meet a minimum 25 percent local content.

Further, ZimTrade and the Botswana Investment Trade Centre (BITC) signed a memorandum of understanding in 2018 to facilitate collaboration and cooperation between the two organisations.

Speaking during a recent webinar on “Doing Business in Zimbabwe and Botswana”, ZimTrade manager for the southern region, Mrs Jacqueline Nyathi, said close relations with BITC have enhanced collaboration in promoting and strengthening trade and investments in the two countries.

Since its signing, she said valuable business exchanges have been facilitated through participation of more Zimbabwean companies at the Global Expo Botswana and Botswana businesses at the Zimbabwe International Trade fair (ZITF).

In terms of export performance, Mrs Nyathi said Zimbabwe’s exports to Botswana were on an upward trend, having increased from US$27,3 million in 2020 to US$37,9 million in 2021.

Among the top exporter products are sugars and sugar confectionary whose earnings doubled from US$8 million in 2020 to US$16,9 million in 2021.

During the period, Botswana imported US$8 million worth of wooden products from Zimbabwe up from US$5,9 million with ceramic and pharmaceutical products jumping to US$1,69 million and US$1,24 million from US$356 000 and US$787 000 respectively.

Based on the 2018 Market Survey, which was conducted by ZimTrade, Mrs Nyathi said the Botswana market presents huge opportunities for local producers mainly in fast-moving consumer goods category, building and construction supplies, clothing and textiles, as well as agricultural implements.

In this regard, products with high potential include processed foods such as herbal teas, dairy products, cereals, juices, horticulture produce, furniture and timber, safety wear and packaging services, and leather.

“Zimbabwe has a thriving leather industry that produces exotic leathers and skins including crocodile, snake, elephants, and others,” said Mrs Nyathi.

“Collaborations between Zimbabwean producers and fashion buyers, retailers and designers in Botswana can create leading products that are globally competitive.”

She said more synergies could still be explored on sectors such as medical services, research and development, education, and business consultancy, among others.

“There are plenty opportunities to be exploited as we grow trade between our two countries, our history unites us and what makes us different can only serve to make us more competitive as we come together through trade.”

BITC executive director in charge of export development and promotion, Mr Temo Ntapu, said his country has vast investment opportunities, especially on raw material beneficiation, energy development, agriculture, creative sector, multi-commodity centre development, and battery manufacturing.

These are being enabled by a cocktail of incentives covering customs duty waivers, favourable exchange and fiscal control regulations, and taxation rebates, among others.

Since 2019, Botswana has consistently increased its salt, light petroleum oils, veterinary vaccines products, and building blocks or bricks exports to Zimbabwe as top products.

Other products include clothing accessories, footwear and lead-acid storage batteries, motor vehicles, and exercise books, though on minimal scale.

Mr Ntapu, however, said Botswana products still have more potential in Zimbabwe especially those related to machinery, pharmaceutical components, mineral products, paper and beauty products, home textiles and chemicals, rubber and plastics, motor vehicle parts, and meat products.

Speaking at the same event, Zimbabwe Investment and Development Agency (ZIDA) head of investment licensing, Ms Felisters Chikandiwa, said Zimbabwe has immense business opportunities in terms of public-private partnerships, special economic zones, and general investments.

Zimbabwe Investment Development Authority (Zida)

She explained the importance of acquiring an investment licence, which provides investor protection in accordance with the country’s laws, as well as ensuring confidence to lenders and stakeholders, assisting the investor secure post-investment permits or critical approval, capital raising, and repatriation of dividends, among others.

She went on to unpack the investment approval process, key considerations for licence appraisal, and the significance of having a one-stop investment services centre.

A representative from Freight World, a Zimbabwean shipping, forwarding, and customs clearance organisation, also had the opportunity to highlight the key services they offer to enhance trade such as insurance, warehousing, forwarding of cargo by all modes of transport, and customs clearance.

The presentation also covered importation requirements for corporates from both countries and how to make the processes easier.

Zimbabwe Revenue Authority (Zimra) representatives took time to explain the process of registration of companies under trade agreements, which includes an inspection of the manufacturing process to be undertaken, as well as export documentation, and transportation modalities.ba-chronicle