BY MTHANDAZO NYONI
ZIMBABWE’S export trade promotion body ZimTrade says it will next month explore opportunities for Zimbabwean products in South Africa.
The excursion into Zimbabwe’s largest trading partner will be key in helping the country rebuild its export base after suffering a US$300 million trade deficit during the first quarter of 2021, as imports continued to dominate the value of goods exported by the country.
In its first quarter economic bulletin released recently, the Finance ministry said Zimbabwe imported goods worth US$1,4 billion during the period, and exported goods worth US$1,1 billion.
Trade deficit, which occurs when a country’s imports exceed exports during a given time, has haunted Zimbabwe for many years as its industries struggle to produce and export higher volumes compared to an avalanche of goods flowing in from other countries.
The result has been prolonged foreign currency shortages, which have militated against efforts to turn around the economy.
The South African mission is the second to be announced by ZimTrade within a month, after the agency earlier said it would be leading another delegation to Rwanda to explore export opportunities.
Official data indicates that Zimbabwe gets about 40% of its import requirements from South Africa, while about 75% of its total exports are absorbed by that country.
The trade between the two is, however, heavily skewed in favour of South Africa.
ZimTrade said it will visit the Gauteng province, taking advantage of its proximity to Zimbabwe.
“The outward mission will accommodate 20 export-ready Zimbabwean companies and SMEs (small to medium-scale enterprises) in sectors that include agricultural implements and inputs, building and construction, protective clothing, engineering, processed foods and beverages,” ZimTrade said in its latest newsletter.
“While there is need to diversify export markets to minimise trade risks, it is important to continue to harness the export potential in South Africa, leaning on the country’s advanced development.
“Additionally, the two countries are separated by a border and their proximity is difficult to ignore when we talk of the advancement of trade.
“However, statistics are currently only benefiting one country.”
The programme will commence with trade and investment seminar where both countries will highlight existing trade and investment opportunities in their respective economies.
In its first quarter report, the Finance ministry said: “Mineral exports dominated in the top 20 exports products at 84%, with nickel ores and mattes, ferro-chromium, industrial diamonds, platinum and coal products registering growth.
“On the downside were gold, flue-cured tobacco and other tobacco products.
“The country’s exports were mainly destined to South Africa, absorbing 34%, followed by UAE and Mozambique, absorbing 23% and 10%, respectively, while the rest of the world imported 33% of our products.
“Similarly, merchandise imports increased by 12% to US$1,4 billion from US$1,3 billion realised during the same period last year. Compared to the fourth quarter of 2020, imports fell by 4% from US$1,5 billion.”
The report said Zimbabwe’s import basket was dominated by crude soya bean oil, fertilisers, medicaments and wheat.
Mineral exports have increased since world markets reopened this year, with governments relaxing Covid-19 lockdown regulations.
The data showed that exports rose to US$1,1 billion during the period from US$1 billion previously.
Demand for fertiliser has been supported by favourable rainfall received during the 2020/21 season, with urea and ammonium nitrate registering significant increases.
The Covid-19 the pandemic has driven demand for medicaments and personal protective equipment since the virus broke out in 2020.
“Imports for maize which have been on the rise due the last two consecutive droughts are coming down as the country is expecting a bumper harvest,” ZimTrade said.
“Similarly, fuel imports declined sharply during the period under review, mainly from lockdown measures and depressed economic activity.”