The Ministry of Industry and Commerce is currently coordinating the development of local content thresholds (LCTs) across all national economic sectors as part of supporting industrialization and industrial growth and development in line with the Zimbabwe National Industrial Development Policy (ZNIDP) 2019-2023. The local content thresholds, once established, will allow national stakeholders to tap into inherent economic potential across various sectors thereby boosting investment, beneficiation, value addition and value chains development in line with the National Development Strategy (NDS) 1 (2021-2025), the national development blue print. By emphasizing the procurement of local inputs and products along the commodity value chains based on specified metrics, local content thresholds support industrial development and the intensification of linkages.
The pharmaceutical, fertilizer and packaging sub-sectors have been selected as the premier targets in the endeavour to develop local content thresholds across all sectors. The recommendations from these investigations will help refocus the strategy at it is implemented across other sectors. The three sectors were selected because of their unique contribution to the welfare of the Zimbabwean people.
The Pharmaceutical sector contributes only 12% of local medicines consumed in the country with the rest being imported. This presents huge opportunities for substantial import substitution as well as reducing risks of supply chain disruptions for essential medicines more so in these periods of pandemics like COVID 19 and geopolitical tensions. It is thus prudent for Zimbabwe to be self-sufficient in these products.
The backbone of the Zimbabwean economy is the agricultural sector and hence a robust Fertiliser sector is needed to support the farming activities. Furthermore, the geopolitical tensions in Eastern Europe have necessitated the aggressive domestication of most supply chains to ensure supply reliability and price stability in line with the country’s aspirations towards food security hence the need to explore how domestic production can be enhanced.
The Packaging sector cuts across all facets of the economy as most products require packaging of some sort and is one area that has potential to drive local content if most supply chains are localised. The sector thus has immense potential to create linkages with the local industrial sector.
In order to develop local content thresholds for the three subsectors, the Ministry of Industry and Commerce, requested for technical support from the United Nations Economic Commission for Africa (UNECA) Sub-Regional Office for Southern Africa (SRO-SA) to engage a consultant to anchor the process and draft the thresholds in a fully consultative manner which captures the views of various stakeholders along the value chains. The consultant undertook desk research on the matter and administered a questionnaire to elicit views from the stakeholders specifically recommended by the Ministry of Industry and Commerce (MIC). The findings have been synthesized and compiled on the draft report on Development of Local Content Thresholds for the Pharmaceuticals, Fertilizer and Packaging sub sectors in Zimbabwe. The draft local content thresholds report will be validated by stakeholders at a meeting to be organized by MIC in collaboration with SRO-SA on February 24th, 2023 in Harare.
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