18 January 2012
THE Zambia Association of Manufacturers (ZAM) has hailed Government’s decision to recapitalise the Development Bank of Zambia as this will boost growth in the manufacturing sector where growth has of late, stagnated.
ZAM president Chance Kabaghe said in an interview that recapitalising DBZ would offer Zambian entrepreneurs, especially those in the value addition sector, to access long-term financing to allow business to grow.
He said one of the biggest constraints faced by the manufacturing sector in the country was the non-availability of long-term loans, but that with Government realising this handicap and working on it, the manufacturing sector’s growth could be lifted up.
“We are encouraged by the pronouncements of the Finance minister Mr Alexander Chikwanda over DBZ and its gives us great pleasure and reason to hope for a better manufacturing sector, growth lately has stagnated,” he said.
Mr Kabaghe was referring to the recent annoncement by Finance and National Planning Minister Alexander Chikwanda that Government was considering recapitalising DBZ so that it could offer long-term loans to Zambian entrepreneurs which were not easily available at commercial banks.
The DBZ would be providing at least US$2 million of $8 million Chimsoro Group is borrowing from banks to resuscitate the Kapiri Glass Manufacturing (KGM, which went under in 1998.
Mr Kabaghe described the loan to the KGM as one that would have enormous trickledown effects as it would lower the cost of production for major bottle importers like the Zambian Breweries Group and Freshpikt where he is charperson, among others.
He added that apart from non-availability of the long-term loans, Zambian manufacturers were seeing their goods fail to compete favourably with foreign goods because of the high cost of production in the county.
“But the Finance minister has indicated to us that he has tasked the Bank of Zambia to work out ways of reducing the cost of money and doing business in the country. This will be of great benefit to us the manufacturers as we have asked for this for a long time,” Mr Kabaghe said.
AllAfrica – All the Time