(Ecofin Agency) - Manufacturing activity in Zimbabwe will fall to 27% in 2020 from 36% in 2019, according to the Chief Executive Officer of the Confederation of Zimbabwe Industries (CZI), Tafadzwa Bandama. This is the finding of the CZI’s 2019 Manufacturing Sector Survey.

According to this survey, this situation is largely due to the currency problem faced by 88% of companies, of which 53% obtain less than 10% of their requirements. The weak demand for goods and services faced by businesses and the decline in consumer income are also contributing to this situation.

Tafadzwa Bandama said the slowdown would result in higher unemployment, rising poverty levels, shortage of goods and services, inflation, reduced aggregate demand, low exports volumes, and increased shortages of foreign currency. He added that this situation will reduce the government's ability to raise revenues.

In order to revive the manufacturing sector, the official made a number of recommendations. These include the development of new policies to support manufacturers, the promotion of local content, an equitable distribution of energy in the productive sector and commitment to sustainable agricultural development.

According to World Bank data from late 2018, the manufacturing sector in Zimbabwe accounts for about 8.18% of GDP. This is down from its level in 2016 and 2017 when it accounted for 11.59% and 10.78% of the country's GDP, respectively.

André Chadrak