Economy FDI Finance Industry and Commerce Zambia

Zambia major market for Zim iron and steel products

Zambia is the largest importer of Zimbabwe’s iron and steel products from small to medium enterprises due to massive construction works going on in the Southern African country, a report released by the Zimbabwe Engineering, Iron and Steel Sector Strategy 2015-2020 has shown. 
The large scale enterprises did not export much since most of them had scaled down significantly due to the prevailing economic con­ditions.
According to the report, Zambia is accounting for 33 percent of the total Zim­babwean exports followed by Mozam­bique (21 percent) and Malawi (17 percent).
“Being low income states, these nations offer a market for local products.

“The pie chart also show that the sector only com­petes in low income Africa within SADC and adjacent to Zimbabwe,” read part of the report. The low score on high income Africa (South Africa) and no exports beyond the region shows that the sector cannot yet compete with the high income regions like EU, USA and middle income regions like Asia and South America.”

Other destinations for Zimbabwe’s iron and steel products are South Africa, Tan­zania, Botswana and Equatorial Guinea.
The main buyers in Zambia for the iron and steel products are individual consum­ers, SMEs, governments and development agencies and big firms.
Major products in the sector include construction steel, agricultural machin­ery, long and flat steels, pipes and packag­ing material.

The report noted that there were chances for the sector to explore other markets.
“There are therefore opportunities to grow the regional export market, pen­etrate Africa at large and high income countries, develop the international mar­ket by exploring the Asian, EU and Indian market by linking the local value chains to the international ones,” it further noted.

According to the Zimbabwe Economic Policy Analysis Research Unit the coun­try’s engineering and metals sector has potential to generate US$14 billion per year if recapitalised fully and can become a backbone of the Zimbabwean economy if supported by export oriented policies and adequate financial mechanisms.

Industry experts contend that the oper­ationalisation of the country’s major iron and steel company, NewZim Steel, for­merly Ziscosteel, will unlock more mar­kets for the sector.

The Zimbabwean government entered into an agreement with Indian firm, Essar Group, to revive NewZim Steel but the deal has stalled over some disagreements.

Source: The Southern Times

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