Government ropes in industry in awarding of import licenses
GOVERNMENT has set up a committee that incorporates industry players in the awarding of importation licenses, industry and commerce minister, Mike Bimha has said.
Speaking at a breakfast meeting on Friday Bimha said the committee is aimed at restricting unnecessary imports into the country.
“We have come up with a new arrangement for processing of applications for import licenses. We have set up a committee that comprises of ministry officials and representatives of the private sector which will be evaluating applications for imports before recommending the same to us for approval.
We are also going to set up sub committees around that sectors that are facing stiff competition from imports. We want producers to determine what should be imported and from where. Industry players will determine the quantities that need to be imported to fill the gap between demand and local supply.
Our pre-shipment agent, Bureau Veritas will also assist in regulating the quality of goods imported in the country,” he said.
Bimha said government has put in place measures that restrict imports by removing a number of products from the Open General Import License (OGIL), to ensure that the products are imported under licensing.
Bimha said a recent wholesale and retail sector survey conducted by the ministry of industry and commerce revealed that the aggregate average space allocated to local products in wholesale shops stands at 70%, compared to the retailers whose aggregate average is 49%.
According to findings of the survey, local cooking oil brands occupy 95% of the shelves, while sugar which is available in the shops is 100% locally produced. Local mealie-meal also occupies 100% shelf space in most supermarkets.
However, only 10% of locally produced washing powder is available on the shelves, while the remaining 90% is imported as local producers hardly have the capacity to meet demand. Equally, local bar soap only occupies 15% of shelf space, while 85% is imported.
Bimha said local bathing soap occupies 35% of the shelves, while liquid soaps occupy 15% of the shelf space. For biscuits and sweets, Bimha said 70% of the shelf space is taken by local producers which he noted have the capacity to meet local demand.
He said Local flour products occupy 95% of shelf space, while local milk products occupy 60% of shelf space as local producers cannot meet demand. Local margarine products occupy only 10% shelf space as producers are highly incapacitated to meet demand. However 80% of tea shelf space is occupied by local brands.
According to the survey, local cereals occupy 30% of the shelf space while 70% of the products on the shelves are imported. Imported sanitary pads dominate the market as 85% of the shelf space is imported; foreign baby diapers also dominate the market at 95%.As for Pasta, locally packaged brands occupy 45%, thereby competing fairly with imports.
Bimha said the country has potential to manufacture all the products consumed locally and still have excess for exports.
“We are located at the heart of Southern Africa, this is a huge advantage that can be exploited further,” he added
Bimha called on players in the retail sector toprioritise procurement of locally produced goods as this is helpful in improving the industry capacity utilization and thereby creating jobs.
“I would like to appeal to retailers and wholesalers to buy local and support our local industry. The quantity of imports from one outlet to the next is purely a management decision, so I would like to urge players to buy local so as to help the country preserve jobs, rather than export them.
“This also helps our industry to increase capacity utlisation. By increasing capacity its capacity, the local industry will enjoy economies of scale in their production processes, leading to reduction in the unit cost of production, which will in turn lead to a reduction in the price of the final product,” he said. -FinX