Manufacturing Growth Revised Upwards to 2.5% on Account of DISCO
The government has revised the growth projection for the manufacturing sector upwards to 2.5% from 1.5%, which was initially projected in November 2023. This revision takes into account the commencement of operations at Dinson Iron and Steel Company (DISCO).
According to the Minister of Finance and Investment Promotion, Prof. Mthuli Ncube, while presenting the 2024 Midterm Budget and Economic Review, this projected growth reflects the expected positive impact of ongoing investments.
“The growth of the manufacturing sector has been revised upwards to 2.5% from the 1.6% projected in November 2023, to reflect the expected positive impact of substantial investments in both existing and new plant and machinery.
“In addition, the projection also considers the commencement of steel production at Dinson Iron and Steel Company in Manhize and its effect on both downstream and upstream industries,” he said.
Despite the growth in output during 2023, capacity utilisation slightly declined to 53.2%, primarily due to new investments that increased the installed capacity of the local industry.
Prof. Mthuli Ncube also mentioned that investments in modern technology, artificial intelligence, and robotics have resulted in increased production in the bakery and dairy subsectors.
“Significant investments in modern automation technologies, such as robotics, have led to the bakery subsector increasing bread production capacity to 2.3 million loaves per day.
“Similarly, the Dairy Processors Association of Zimbabwe has formed partnerships with tertiary institutions such as the Harare Institute of Technology, Chinhoyi University of Technology, and a Danish university to enhance the training of technicians in areas related to dairy technology, production efficiencies, and ensuring high product quality. New production technologies are also being installed in the edible oils, beverages, and other subsectors. All these interventions are directly increasing productivity through modern technology,” Ncube said.
Reviving the Clothing Sub-Sector
Furthermore, to revive the clothing sub-sector, the Zimbabwe Cotton-to-Clothing Strategy 2024–2030 amendment is expected to be completed and implemented by the end of 2024.
Investments in the Fertilizer Sub-Sector
Notable investments were recorded in the fertilizer sub-sector, with refurbishments at Sable Chemicals and ZFC Limited, two of the largest fertilizer-producing companies. The subsector also recorded the entry of two new players, which is expected to significantly increase fertilizer output going forward.
Domestic Steel Production
In terms of domestic steel production, Dinson Iron and Steel Company is now at an advanced stage of setting up a massive iron and steel plant, to be implemented in four phases at a cost of US$1.5 billion. The first phase is now complete, and the production of pig iron and stockpiling for further value addition to steel billets is underway. The second phase, which includes the production of steel billets, is earmarked for the latter half of 2024.
Financial Support for Growth
To facilitate the growth of the manufacturing sector, an amount of ZiG34.5 million was disbursed to the Ministry of Industry and Commerce during the period under review. The sector also benefitted from Development Partner assistance amounting to US$1.8 million. Of this, US$1.3 million was disbursed by the Swedish Embassy towards capacity building for the Confederation of Zimbabwe Industries, aimed at strengthening industrial transformation, enterprise development, and entrepreneurship.