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‘Customs duty suspension will boost manufacturing’

BUUMBA CHIMBULU writes @SunZambian

@SunZambianTHE suspension of customs duty on imported manufacturing inputs will spur growth in the manufacturing sector, increase jobs and exports, Zambia Association of Manufacturers (ZAM) president, Ezekiel Sekele.

This follows introduction of the Statutory Instrument (SI) Number 110 of 2020, allowing for suspension of customs duty on imported manufacturing inputs which cannot be sourced locally.

It came into operation on January 1, this year.

Mr Sekele said the growth in the manufacturing sector would also spillover to the overall economic recovery as outlined in the National Economic Recovery Plan.

He said in a statement that the SI No. 110 of 2020 came at a time when Zambia was building back through the Economic Recovery Programme (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.

“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,” Mr Sekele said.

He stressed that the importance of the SI 110 of 2020 to the sector could not be overemphasised.

A progressive SI as this, he said, showed that Government was committed to supporting the manufacturing sector and ensuring that it grew 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.

“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 said the global, regional and local events which occurred in 2020, and some of which had continued into 2021, had left the manufacturing sector struggling, even to a point of recording negative growth of -4.6 percent in the second quarter of 2020.

Mr Sekele said with the local input industry still developing, it currently could not meet the demands of the entire sector, and thus the manufacturing sector remained 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,” he said.

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