Manufacturing sector capacity utilization marginally up as hurdles remain

National Foods

HARARE –  Local manufacturing sector capacity utilization during fourth quarter (Q4) of 2021 marginally increased by a single percentage point to 66% from 65% prior quarter indicating the continued capital investment by Zimbabwean firms to boost production despite facing a myriad of operational challenges.

According to the ZIMSTAT Manufacturing Sector Business Tendency Survey: 4th quarter 2021 report, the drinks, tobacco and Beverages sub-sector had the highest capacity utilization of 79% while at 15% capacity, was the lowest sub-sector of other manufactured products.

This was based on views of senior managers of 146 high value manufacturing companies towards business conditions.

Overall balance of opinion for production level in relation to the past three months was 19 percentage points ahead with major contributors to the positive balance being manufacturers in the ‘Drinks, Tobacco and Beverages’ industry group. calox ivermectina

This is attested by the results from the weekly foreign currency auction system which shows that the bulk of allotted foreign currency was channeled towards machinery and equipment and raw materials for both the SME and Main auctions.

Most ZSE-listed companies have been reporting substantial capital investments since last year, mainly attributed to re-dollarization in the economy and improved earnings following the relaxation of COVID-19 restrictions.

However, the overall balance of opinion with reference to production levels in the next 3 months decreased by 2 percentages from 39% in Q3 to 37% in Q4, reflecting the country’s unfavorable business environment.

Major constraints facing industry according to the survey were shortage of raw materials (52%) , cash flow difficulties (48%) and uncertainty towards the economic environment (48%). These were the same major constraints in Q3.

2021 was largely characterized by global shipping and logistical challenges caused by COVID-19 disruptions adversely affecting supply chains and triggering inflation.

The fourth quarter 2021 Manufacturing Confidence Indicator (MCI) was -0.3 percent, implying respondents had almost the same view towards the manufacturing sector business conditions as they had in the third quarter.

Purchasing Managers’ Index (PMI) stood at 50.7%, representing a 10 percentage point increase from 40.7% recorded in the third quarter. The index value signifies an expansion in the manufacturing sector during Q4 when compared to the third quarter.

On employment in the manufacturing industry, 28% of the survey respondents viewed total employment in the past 3 months as having increased, while 64% remained neutral. zimecterin for humans

Regarding total employment in the next 3 months, 30% of the respondents anticipated the variable to improve, as 63% expected no change. stromectol dosage for adults

The outlook for changes in selling prices was such that 62% of the respondents expected price increases over the next three months signaling industry’s lack of confidence that the government will stem inflation in the short to medium term.

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