By Bennie Mundando
THE Zambia Association of Manufacturers (ZAM) has commended the Government on the introduction of what it terms a progressive Statutory Instrument No. 110 of 2020 which allows for suspension of customs duty on imported manufacturing inputs which cannot be sourced locally
ZAM President Ezekiel Sekele says this shows that the Government is committed to supporting the manufacturing sector and ensuring that it grows as a major contributor to economic growth in Zambia.
“ZAM would like to thank the Government for the introduction of Statutory Instrument (SI) Number 110 of 2020, which came into operation on 1st January 2021. This allows for suspension of customs duty on imported manufacturing inputs which cannot be sourced locally.
“A progressive SI as this, shows that the Government is committed to supporting the manufacturing sector and ensuring that it grows as a major contributor to economic growth in Zambia. ZAM, in recognition of the erroneous commencement date of 1st January 2020, as stated in the SI, urges the Government to expedite the correction of the date to reflect commencement date as 1st January 2021,” Mr. Sekele said.
He says the importance of the SI 110 of 2020 to the sector cannot be overemphasized because the global, regional, and local events which occurred in 2020, and some of which have continued into 2021, have left the manufacturing sector struggling, even to a point of recording negative growth of -4.6 percent in the second quarter of 2020.
he says with the local input industry still developing, it currently cannot meet the demands of the entire sector, and thus the manufacturing sector remains dependent on a number of imported input raw materials and intermediate inputs.
“Moreover, supply chain disruptions, which were brought about by COVID-19, further exacerbated the situation and crippled manufacturing companies as they could not import manufacturing inputs smoothly and if they did, the inputs took long to arrive and at a high cost.
“SI No. 110 of 2020 comes at a time in our country when we are building back through the Economic Recovery Program – ERP. The introduction of the SI 110 of 2020, is therefore exciting news to the local manufacturers, whose costs will be cushioned when importing manufacturing inputs and undertake value addition to produce final goods,” he said.
“ZAM recognises the importance of SI 110 of 2020 but is also aware that inputs have to meet the eligibility criteria set out in the SI. The implementation of the SI will be used to spur growth in the manufacturing sector, increase jobs and exports. Furthermore, the growth in the manufacturing sector will also spill over to the overall economic recovery as outlined in the National Economic Recovery Plan,” he said.