Nkosentsha Khumalo
Bulawayo – Yesterday, a Senior government Minister led a delegation tasked with evaluating progress on national development projects.
The delegation was in tour of General Beltings (GB) Holdings, one of the dwindling Bulawayo’s giant companies. The company manufactures rubbers products as well as conveyor belts.
The tour of the GB Holdings facility was conducted to appraise the government officials of the company’s progress or lack of, in implementing its operations and meeting production targets, which is believed to be part of the government’s ongoing efforts to assess the status of economic development initiatives across the country.
Touring of Bulawayo “still surviving” industries is yet another promise, which has for long been claimed by the government to serve the purposes of resuscitating the City as the Industrial hub of the country, with pinned hopes of attaining its former glory.
The government delegation sought to obtain a comprehensive understanding of the current status of private sector led businesses, government programs and projects and identify potential bottlenecks.
Once the pride of Zimbabwe’s industrial scene, Bulawayo’s manufacturing sector has been languishing in the shadows for many years, a fading beacon that has defied efforts to reignite its former glory. The Industrial failure is blamed on poor government policies that have seen major international companies pack bags and leave the country.
Despite the government’s pledges to revive the city’s economy zone, the promise of a thriving industrial hub remains elusive, a mirage that continues to mock its citizens. The City’s factories have continued to fall into disrepair, machinery have become obsolute and skilled workers fleeing for greener pastures, one is left to wonder if the City of Bulawayo will ever reclaim its lost status as an industrial powerhouse, or it will forever be relegated to a footnote in Zimbabwe’s economic history.
Special Advisor to the President Responsible for Monitoring and Implementation of Government Programmes, Dr. Joram Gumbo, who was responsible for touring of General Beltings (GB) Holdings Limited, said the Government through the Ministry of Industry and Commerce has crafted strategies targeted at the revival of ailing industries.
This is not the first time such steps have been pronounced.
GB Holdings gained prominence for the production of conveyor belts during the pre and post-independence period.
“Its operations were, however, affected by the closure of industries because of various reasons, including the sanctions induced economic hardships,” claimed Dr. Gumbo.
It has been ascertained that the conveyor belts manufacturing company requires at least US$22 million recapitalisation funding to modernise its plants and pins its hopes to secure a loan from the Matabeleland Industries Retooling Facility.
“It is therefore no coincidence that my office identified GB Holdings as one of the companies to be on the itinerary during this series of visits in the Government’s effort to provide an environment that is conducive for private sector led businesses to flourish, ” said Gumbo.
“In response to assist GB Holdings, government has crafted strategies targeted at the ailing industries, which include the promulgation of Statutory Instrument 126 of 2014 which prohibits the importation of locally available rubber products under the Open General Import License, the setting up of Distressed Industries Marginalised Areas Fund (DIMAF) and the Matabeleland Industries Retooling Loan Facility to financially assist distressed companies. “
Gumbo said the tour is part of Government’s intention to strengthen industry operations so that companies like GB Holdings do not continue to lose market share which might result in closure of business.
“I am informed that my visit comes at a time when there is a profound decrease in manufacturing and in the local market share of GB Holdings. I have been briefed that GB Holdings has been confronted by challenges despite the establishment, resuscitation and expansion of mines across the country, which would ordinarily require belts. The challenges include stiff competition from cheap imports and limited access to foreign currency to import raw materials.”
Government is also discouraging the importation of goods and products that can be manufactured locally and are available on the market.
This is out of the realization that cheap imports will push local authorities out of business and have a negative effect on efforts to create jobs and grow the economy.
GB Holdings Acting Group Managing Director, Joseph Gunda, said despite playing a key role in the economy, the company is facing a number of challenges that are crippling operations, such as smuggling and importation of cheap conveyor belts.
“The company is a key player in reviving the economy. We manufacture original products that we export to other countries. We are competitive against South African bonafide companies,” he said.
“Our plea is to have the Government assist in capacitating the company, which is able to save forex and promote local products.”
Whereas, in as much as smuggling and importation of cheap Conveyor Belts may be affecting the operations of company, the company is still failing to thrive due to some others factors which include high labour costs, electricity costs and loss of it, as well as the temptation for companies to seek rapid profit as they charge exorbitantly.
Most manufacturing companies have contributed largely to their own struggles due to the eagerness to earn quick buck by setting their products at higher prices, making it difficult for potential buyers to gain interest.
In such instances, most local companies prefer importing their Conveyor Belts from China, where they can get a much reasonable landed cost as compared to purchasing the conveyor belts locally.
The cost of purchasing a Sidewall Rubber Conveyor belt for mining costs US$10 per meter in China, attracting a sample cost of US$100 for 30 meters when purchasing the products in bulk.
In Zimbabwe, local companies would find the same Rubber Conveyor belts at higher costs of even US$15 for a meter, which makes it difficult for local companies to purchase these products within the country.
Due to the reasonably low transportation fee from China to the Beitbridge border, and similarly reasonable duty fees from Beitbridge to Bulawayo, many local businesses find it more cost effective to import these products from other countries rather than purchase them at higher prices locally.
Most industries, hence have to necessitate a reassessment of their marketing strategies in order to remain competitive in the industry in this bid to attain Bulawayo’s Industrial former glory.
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