HARARE - Zimbabwe's trade deficit declined by 19 percent to $380 million in the first two months of 2016 compared with a year earlier, as a result of tight import regulations and low liquidity levels in the country.
The trade gap was down from $472 million at the end of February 2015, data released by Zimstat this week shows.
In his 2015 National Budget, Finance minister Patrick Chinamasa hiked customs duties and surtax on selected imports in a move that was aimed at reducing the country’s trade deficit as well as a measure to protect local industries from cheaper imports.
In the two months to February, South Africa remained Zimbabwe’s largest trading partner after trade between the two neighbours reached $689 from a total of $839 million.
Zimbabwe exported goods valued at $374 million to Africa’s number two economy and imported $315 million goods from South Africa resulting in a trade surplus of $59 million in favour of Zimbabwe.
The latest development comes as good news to industry stakeholders who have been calling for a balanced trade between the two countries — which for the past few years has been skewed in favour of South Africa.
For instance, in 2012 South Africa enacted the Preferential Procurement Policy Framework Act that stipulates that 75 percent of procurement should be local in an effort to protect South African manufacturers.
However, ZimTrade chief executive Sithembile Pilime this week said South Africa must increase access to its markets by Zimbabwean companies to improve trade between the two neighbouring countries.
“There is also a need for South Africa to open its market to competitive, value-added Zimbabwean products such as clothing, footwear and furniture, among others. We need to grow our exports and our countries’ companies can work together through partnerships, joint ventures and investments in the value addition of our numerous resources,” she said.
South Africa mainly imports minerals and tobacco from Zimbabwe as opposed to processed goods that are imported from one of Africa’s largest economy.
Zimbabwe is a significant producer of gold, platinum, diamonds, coal and nickel and major miners such as Anglo American Platinum, Impala Platinum, and Mzi Khumalo’s Metallon Gold have operations here.