Candid Comment:Show a damp squib as industry trudges on

Itai Masuku

THE 102nd edition of the Harare agricultural show begins today and, unlike in previous years, will take place over nine days instead of six. We understand space has been over-booked, indicating continued interest in what was originally the country’s largest showcase of agricultural production.
Given the nexus between agriculture and the local manufacturing industry, the show grew over the years to include exhibitions from manufacturers, miners, services industry and other sectors which occupied the majority of stands.

 
Sadly, most exhibitors since dollarisation are not so much of those who are in manufacturing but are merely import agents for foreign manufacturers.
The state of Zimbabwe’s manufacturing industry remains dire and even figures that the sector is now operating at 60% of its capacity should be taken with a pinch of salt.

 
One believes capacity utilisation is probably around 40%; let’s call this an intelligent thumb suck, and here is why: Electricity is generally not available half the time, so, already about 50% capacity has been lost.

 
Secondly, liquidity challenges still persist as companies struggle to find affordable funding for working capital, never mind some for fixed capital.
It is now accepted that in order to produce competitive products, the majority of our companies have to retool. Cairns has often been cited as an example.
The company has been battling to do GOOD, ie to Get Out Of Debt, while operating on antiquated machinery.

 
As one analyst pointed out, it is cheaper for the company to buy modern equipment than for it to struggle refurbishing the old.
Even erstwhile blue chip companies like RioZim are also still struggling to do GOOD.

 
Elsewhere in this edition, we hear of the company negotiating with its creditors over delayed payments.

 
The Rio stand used to be one of the most interesting at the show, particularly the Tinto Industries section, spawned from the group’s mining activities.
Thirdly, unemployment levels still remain very high, estimated variously at between 80% and 90%.

 
Anyone 35 and above surely knows that they are regularly bombarded by well-qualified, vibrant and intelligent youths seeking employment.

 
A pitiful site is one along Enterprise Road, close to Newlands, where scores of men and women can be seen hanging around an ongoing construction project hoping to be called for an odd job.

 
That’s because very little is taking place in the industrial sites, where the vast majority of exhibitors at the show used to hail from. Regrettably, the industrial sites resemble ghost towns nowadays.

 
This year’s agricultural show takes place at a time when official figures show the sector’s output declining by 16% and the economy expected to shrink by at least four percentage points.

 
The projected contraction in agriculture has been reflected in market sentiment on the Zimbabwe Stock Exchange, where year-to-date, counters in the sector have fallen by 15%.

 
Financial counters have tumbled 30% year-to-date and one need not overemphasise how vital this sector is to facilitating agriculture and this country’s agro industries.

 
Some analysts believe sentiment in the financial sector belie deep-rooted problems which will manifest with time. We wait with bated breath.