Smuggling must be dealt with decisively

15 Jul, 2018 - 00:07 0 Views

The Sunday Mail

Clemence Machadu
Illegal entry points also pose a security threat. They can be used to import dangerous weapons, which have the potential to cause instability.

Howdy folks!

One of the reasons why Zimbabwe is experiencing cash challenges is the high trade deficit that has been widening over the years.

Imports continue to rise excessively against exports, which are the country’s major source of foreign exchange.

On the other hand, imports are a huge drain of foreign currency to the fiscus.

Between February and June, for instance, Zimbabwe’s trade deficit widened by 33,9 percent to $1,26 billion, compared to $938 million during the same period in the prior year.

However, what should be noted is that a sizeable chunk of these imports are smuggled goods that get into the country illegally.

The Zimbabwe Revenue Authority (Zimra) is on record as saying that it has identified dozens of illegal ports of entry along the country’s borderline, and no one is manning those points — leaving them at the mercy of every rogue and unscrupulous dealer out there.

These illegal crossing points are therefore hotbeds for the movement of substandard, banned, restricted, illegal and dumped goods.

The main challenge with this ugly phenomenon is that Government is prejudiced of millions of revenue that should be funnelled into the Consolidated Revenue Fund to develop the country.

This also results in Government having inadequate revenues to finance its programmes. Ultimately, this forces Government, given its high appetite for resources, to borrow from the domestic market and crowd out the private sector in the process.

The second challenge with smuggling through both official and illegal ports of entry is that it affects the competitiveness of local industries, while rendering all the protective instruments such as SI 122 impotent and sterile.

The country cannot achieve its economic and social goals as long as it has no control over its entire borderline.

Most imported goods are posing unfair and illegal competition to locally produced products.

What’s worse is that the vendors who sell these products are equally not licensed; as a result, nothing accrues to Zimra.

Overall, this constrains the sustainable growth of formal local businesses, which end up operating at low capacity.

Zimbabwe is signatory to many trade treaties with regional and international blocs such as Comesa, Sadc and the World Trade Organisation (WTO).

Such treaties can only be enforced through well-functioning borders.

However, with many illegal ports of entry, Zimbabwe becomes vulnerable.

For example, most goods whose importation has been restricted usually find their way onto the local market.

There are also phytosanitary measures that have been put in place to protect humans, animals and plants from diseases, pests or contaminants.

By having more illegal crossing points compared to formal ones, Zimbabwe cannot effectively control the spread of pests and diseases.

Cases in point include the import ban on cold meats and poultry after the outbreak of listeria and Avian influenza, respectively, in South Africa.

But all these actions are unlikely to achieve their intended objectives for as long as the illegal borders remain in place.

Illegal entry points also pose a security threat. They can be used to import dangerous weapons, which have the potential to cause instability.

Zimbabwe, therefore, should protect its territorial integrity by prioritising border patrols and surveillance.

It is not surprising that illegal products such as skin lightening creams, expired family planning drugs, cough syrups such as Broncleer and others are now a common feature on our streets.

These products are a nuisance to the country’s social fabric.

Surely, the country cannot be left to be a dumping site for just about any commodity that can have a market.

Government has a responsibility to protect its citizens from consuming products that can pose harm to them and to protect its economy by allowing it to grow so that people can have better livelihoods.

However, the main challenge is that Zimbabwe is using the US dollar as its major trading currency, and being readily convertible and the world’s reserve currency, it is mainly being sought after by unscrupulous dealers that are flooding city sidewalks and pavements with undesirable goods.

Zimbabwe should come up with tougher laws to deal with smuggling and also commit more resources to ensure that its borders are effectively manned and secured.

Drones and other technological gadgets can be used to ensure that illegal activities are exposed or prevented as a means to safeguard the country’s territorial interests.

Local laws should not be seen to be promoting smuggling.

For instance, while Zimra is empowered to forfeit goods that are imported in contravention of the Customs and Excise Act, the tax man is also empowered to release them upon payment of a fine.

So, clearly, the laws should be strengthened to support the country’s anti-smuggling agenda.

While Zimbabwe might be open for business, that must, however, not be confused to opening our borders for just about any product.

Later folks!


Clemence Machadu is an economist and consultant. He writes for The Sunday Mail in his personal capacity.


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