Capri suspends operations, bemoans deteriorating economy

HARARE- Innscor subsidiary, Capri says the local market has shrunk severely due to the disparities between the RTGS and the United States dollar, a situation which needs to be addressed as local market is vital to business survival.

Speaking during a breakfast meeting hosted by the Confederation of Zimbabwe Industries (CZI) on Thursday, Capri Managing Director, Gary Watson stressed that the local market is key to success of any business.

“We have a declined demand in our home market. Every producer needs a local market, you need high demand of your local market and you need high market share,” he said.

Despite the company having increased its exports, the deteriorating local situation has not helped with the export incentive in RTGS  received from government relatively lower in cross rate terms.

“We have grown our exports, we’ve grown our products exporting to Zambia, DRC, Malawi and we exporting to Mozambique now,” he said.

“So our exports have been on the growth point and the government has been giving incentive which is assisting us to and essentially the export incentive is driving us to get market share in different countries. But what’s happen now is the export incentive is in RTGS which has fallen four times in real terms.”

Watson says the deteriorating local economy has left the company in a conundrum failing to payoff debt accrued from its suppliers because they are struggling to get the foreign currency to service the debt.

“So we are kind of also stuck in a rock and hard place,” he said.

With the economic state diminishing, most businesses have been left in a tight corner with the costs of production and operation increasing in the face of foreign currency and cash shortages.

Watson called upon the relevant authorities to address the worsening economic situation in order to get the country back on track and drive business forward, or else the country risks losing more skilled labour force  searching for greener pastures to countries like South Africa.

“Normally at the end of the year we make a decision to pay bonuses, but this year bonus was their (employees) salaries just to make sure they survive because also we build up the skill of those people who work in our factories and we have to retain them,” he said.

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