THE fact that Zimbabwe’s export basket is still dominated by primary commodities such as minerals is a clear sign that the country is not ready for the African Continental Free Trade Area (AfCFTA), the Zimbabwe National Chamber of Commerce (ZNCC) has said.
Trading under the AfCFTA officially commenced on 1 January 2021, after years of ambitious planning and negotiations and in the face of the Covid-19 pandemic.
The AfCFTA brings together all 55 member states of the African Union (AU) covering a market of more than 1.2 billion people, including a growing middle class and a combined gross domestic product (GDP) of more than US$3.4 trillion.
Speaking during a ZNCC trade conference in Bulawayo recently, the organisation’s vice-president, Golden Muoni, said Zimbabwe should invest in product beneficiation.
“It’s (Africa) a market of 1.2 billion people but Zimbabwe is importing a lot of goods which are finished and at the same time we celebrate saying we have done US$4 billion of exports. Of what? What are we exporting? Primary goods like tobacco, gold, platinum, coal,” Muoni said.
“Are we doing ourselves any favour? We are dealing with non-renewable resources which can be depleted in the next 50 to 100 years. What are we going to do for other generations which are going to come after us? If you are exporting raw chrome to China or wherever in Europe and the same things are coming back in the form of jewelry, cars, etc.”
“Where we are exporting they are depositing, they are not using everything. They might be using about 5% of what they are importing from Africa, from Zimbabwe and the remainder is deposited to use for the next other generations but Zimbabwe is saying we have exported US$4 billion. US$4 billion of what? We need to export US$4 billion of finished products,” he said.
Zimbabwe’s exports have averaged US$4 billion annually against an import bill of US$6 billion in the past decade.
The country has been saddled with a trade deficit of US$2 billion annually – which is unsustainable. The export basket is dominated by primary commodities, mainly minerals and tobacco (over 70%).
The manufacturing contribution to total exports, according to official figures, has gone down from 40% in the 1980s to less than 15% currently. Exports of services have also stagnated at an average of US$500 million annually–contributing around 10% to total export earnings.
Muoni said Zimbabwe needed to beneficiate whatever she is producing, be it in agriculture or mining, so that “we are going to see ourselves and other generations that are going to come after us.”
“What kind of legacy are we leaving? We are importing furniture from China and exporting timber to China. Teak, all that is coming from Tsholotsho and other places and, in turn, we get furniture. We need to change,” he said.
The main objectives of the AfCFTA are to create a single market for goods and services, facilitate the movement of persons, promote industrial development and sustainable and inclusive socio-economic growth, and resolve the issue of multiple membership, in accordance with the African Union’s Agenda 2063.
It lays a foundation for the establishment, in future, of a continental common market.
“Africa here we come. This is one of the biggest trade blocs in the world. I think Covid-19 came as a wake-up call to show us what we are supposed to do. I am very happy Covid-19 came to wake us up, to say wake up, don’t rely on others, rely on yourself,” Muoni said.
“Don’t import, don’t do that. We are not producing anything as Africa. Where are our pharmacists? We are waiting for Europe, America and the Chinese to make vaccines for us. Are we not human beings? That needs to be corrected.”
“We have to correct that abnormality by making sure that we are self-sustaining, rather than for us to wait for other nations to produce certain drugs or vaccines which we are going to use. Africa is a disgrace! Not a single African country is producing a vaccine to date,” he said.
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