Posted by: Conrad Mwanawashe | April 7, 2016

Somersault!

The @HeraldZimbabwe carries a report on millers crying foul over government’s issuance of import permits to certain companies and individuals to import mealie meal.

The report – http://www.herald.co.zw/millers-cry-foul-as-govt-issues-maize-meal-import-permits/ says that Zimbabwe has issued 68 permits for the importation of 140 000 metric tonnes of maize meal valued at an estimated $60 million, irking local millers.

On their part, the millers argue that Government should not authorise the importation of finished products such as maize meal fearing that the landing price for imported maize meal could be lower than local producer prices; hence driving them out of business.

Furthermore, the millers argue that because they are in the process of importing grain, government should show good faith and stop importation of maize meal.

The sector’s arguments make sense to an extent. However, their pricing structures may have justified the importation of cheaper maize meal. The issue of pricing is critical in Zimbabwe.

It does not apply only to the millers but to the entire economy. Prices of locally produced goods are much higher than in the region.

While I implore the millers to revisit their pricing structures, I  note that the issuance of import permits for maize meal exposes government’s policy flip flops.

On the one hand, government is seeking to promote value addition and beneficiation while on the other hand it is promoting imports of finished goods. A contradiction indeed!

These are the issues that make an investor, whether local or foreign, unsure whether to invest in Zimbabwe.

Government should set policies and follow them to the letter. It would not send right signals if government is to somersault on its own policies.

 

 

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

Categories

%d bloggers like this: