· Borders re-opened to allow for the importation of basic goods
· The allowance contradicts the mantra of local industry capacity utilization
· Farmers to now get 30% of total earnings from the GMB in USD
Harare - Amidst an economic meltdown, the government of Zimbabwe over the weekend announced new measures for the re-opening of borders to allow for the importation of basic goods.
In a statement, the Minister of Finance and Economic Development Mthuli Ncube, said those with free funds are with immediate effect, permitted to make use of these funds and other resources to import basic commodities
This comes after the group already owns 49% of the company’s shares which it acquired in 2019.
In a trading update for the first quarter ended 30 September 2021, the group said the acquisition will help fund TV sales and Home, a subsidiary of the Axia group, to fund the construction of a new multimillion US dollar art factory that will see the growth of production to meet local demand and service export markets.
Meanwhile, TV Sales and Home volumes continued to soar after they went up 36% compared to the same period last year the which in turn enabled
The Group said the growth was driven by competitive pricing, consistent product supply, the positive momentum of credit offerings and exciting consumer promotions namely Winter Warmer, Birthday Bash and Euro 2020 that were active during the quarter.
Volumes at Transerv which specialises in retailing automotive spares also continued on an upward trend, recording a 25% increase from the prior quarter, new store sites were secured in Chiredzi and Victoria Falls.
However, at Distribution Group Africa (DGA) Zimbabwe, volumes were 20% below the prior period, this being a result of the restructuring of the original agreement with the Progroup.
“The resultant reduction in volume sales from the Progroup agency was partly compensated for by the new distribution agreement that was executed with National Foods Retail distribution business. This agreement is a significant addition to the business,” said the Group.
Meanwhile, DGA in the region performed quite well, with Malawi’s first-quarter volumes up 58% owing to the impact of newly acquired distribution agencies: Uniliver, BIC and Clover, thus making Malawi a significant contributor to the positive performance of the regional business.
Zambia also did not perform so well as it recorded a 29% decrease in volumes, this being caused by the appreciation of the exchange rate which resulted in market-wide corrections of business cost bases which led to demand for price reductions and resultantly shrunk product demand.
The group said, “The Zambian Kwacha appreciated against key supplier currencies such as the South African Rand and United States Dollar following the positive political sentiment after the recent Presidential election”.
The group has also partaken in the operation of a hardware store as a joint venture with another industry player, the volumes according to the group seem to be encouraging.
“The volumes in the hardware store are encouraging with a focus in the quarter has been on fastmoving and essential hardware lines as well as supplying key lines for construction. Another store is set to be opened in Q2 F2022 under the same joint venture model, “added the group.
Going forward, the group remains focused on executing the expansion opportunities that were advised before.
“We hope the anticipated economic recovery will continue to be sustainable and will be anchored by conducive policies, which will not only support this recovery process but will also contribute towards the stability of the exchange rate and at the same time keep inflation under control,” added the group.
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