Need to support agro-based industries

10 Mar, 2017 - 00:03 0 Views
Need to support  agro-based industries Fresh vegetables form part of the massive agribusiness in Zimbabwe

The ManicaPost

Chido Chikuni Business Correspondent
A large number of African countries, including Zimbabwe, highly depend on agriculture for their livelihoods as the sector plays a central role in economic growth and poverty reduction not only in our beloved country but also in the African continent as a whole.

As farmers across the nation prepare to harvest their yields, among them, maize, soya beans, groundnuts, cotton and sunflowers, it is necessary for government and other interested parties in the private sector to lend a hand and support agro-based firms that have been operating below capacity for a long time now.

Reviving agricultural based companies is crucial as it creates imports substitution opportunities as raw materials that are produced locally will also be processed into finished products locally. Also, this can reduce the tendency of exporting raw materials, but rather promote exportation of finished value-added agricultural products.

Food processing companies should be seen as a priority sector in the country. Given the contribution of the food processing industry in employment creation, from primary to secondary sector, there is really need for government to prop up these firms.

This year a bumper harvest in all crop production is expected. This follows the heavy rains that the nation received.

The government sponsored Command Agriculture gave support to the increase of local maize production. Other crops like soya beans, sunflower and groundnuts that can be processed into cooking oil and peanut butter respectively would require more local manufacturers.

Maize, which is Zimbabwe’s staple crop, can be processed into mealie meal, popped maize (maputi) and samp to mention a few.  These food processing companies need to be efficient in order to produce more products. Hence, there is need for government to fully support growth of these processing firms as a way of developing the industries and the whole economy.

It is sad that top textile companies like David Whitehead Textiles Limited and Merlin Limited have closed shop due to viability problems. This has negatively affected the processing of raw cotton into fabric material.

Most Zimbabweans have been importing clothing material from neighbouring countries like Zambia and Tanzania.

Given that most cotton farmers are also expecting a bumper harvest this year, it is essential that these textile companies and others which had been grounded, are also resuscitated.

In order for agricultural processing firms to come back to life again, generally they require funds for both working capital and capital expansion.

Hence, government’s intervention is most vital in creating an enabling environment for such resuscitation.

It is, therefore, imperative to note that agro-based companies draw a critical synergy between the consumers, farmers and the industry as a whole. Thus, farmers after harvesting their crops will not grapple in finding available market to sell their produce. Selling farm produce to food processors will make life much easier for both communal and commercial farmers as they will sell directly to manufacturers.

The more agricultural processing firms that are restored to life, the more the prices of products such as food and clothes are reduced. If there is an increased number of manufacturers, normally there is competition among producers, which will encourage a down fall of consumer goods prices.

To add on, competition among manufacturers can also foster innovation and growth which creates wealthy and reduces poverty. Competitive markets are also a cornerstone of capitalism and a market oriented economy as they efficiently address the scarcity problems of consumer goods.

Restoring processing industries in the country can also open new avenues for both local and foreign investors, who may want to do business in Zimbabwe. This can also unlock employment opportunities for locals.

If revitalized, the food processing industry is, therefore, set to drive Zimbabwe’s economy to higher growth.

In the event that most processing companies are revived, there is need for manufacturers to pay due attention to technological development in order to meet international standards in terms of quality of production.

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