By Staff Writer
ZIMBABWE’S manufacturing firms committed US$21,3 million in new investments during the second quarter of this year, a survey by the Confederation of Zimbabwe Industries (CZI) shows.
In its second quarter business and economic intelligence report, the CZI said some of the investments were directed towards procuring new technologies as companies adjusted to the new operating climate brought by the Covid-19 pandemic.
“The survey results show that about US$21,3 million in new investments was undertaken by the firms that responded to the survey,” the report reads.
“About 40% of the respondents highlighted that they had undertaken investments in their businesses over the second quarter.”
CZI said output per worker declined by about 8% during the period.
“This means that worker productivity in the second quarter was about 92% compared to the first quarter.
“However, since there were investments in new technologies only in the second quarter, it is expected that the output expansion due to this investment would be more pronounced in the third quarter, which would see productivity increasing,” it says.
The CZI said in addition to capacity utilisation, business performance is also reflected by an increase in output.
It said business experienced an increase in production in the second quarter of 2021 compared to the same period in 2020.
About 73% of respondents highlighted that their production increased.
“This is generally expected, given that the second quarter of 2020 was marred by shortages of foreign currency, hard tighter lockdowns and high inflation, which was making it difficult for business to operate,” it said.
“The improvement in the general macroeconomic environment can thus be attributed to this positive performance improvement. On average, output across all the survey participants increased by about 3,5%.”
The industry body said the immediate impact of improved operating environment during the second quarter was reflected by performance changes between the first and second quarters, including higher demand for foreign currency at the foreign currency auction.
It said foreign currency bids increased from about US$35 million per week in January 2021 to around US$45 million per week by July.
With about 43% of the allocated funds on the auction market going towards importation of raw materials, this was also reflected by improved output.
The CZI said about 52% of respondents created new jobs during the second quarter of 2021.
As a percentage of total employment, new jobs created during the period constituted about 12%.
However, given that the environment was also characterised by some constraints, the CZI said about 9% of firms undertook retrenchments during the second quarter of 2021.
“The increase in employment also underlines that the improved performance of the businesses also unlocked employment opportunities,” it said.