Time to value add, says ED

President Emmerson Mnangagwa has proposed an indaba on how Zimbabwe should develop value chains for the country’s mining and agriculture sectors with a view to advancing the twin objectives of modernising and industrialising the economy within 12 years.

Such a meeting, he said, would be in sync with the trajectory taken by industrialised nations.

The Head of State and Government said this would counter the “resource curse” and “development paradox” afflicting African countries that are rich in resources but plagued by poverty.

In his weekly column in The Sunday Mail, President Mnangagwa said it was time Zimbabwe started the journey of developing value chains necessary for establishment of an upper middle-income income economy by 2030.

“My own view is that the task of mobilising and organising national knowledge and skills in order to embark on a national exercise of mapping critical value chains for our development strategy is an urgent task worth pursuing.

“Could convening a Presidential Summit or Conference on Value Chains be the answer?” posed the President.

“Countries in our region, most notably South Africa, have done such an exercise. So, too, have countries in Asia which have industrialised. The decision to embark on such a course in Sadc was taken a few years ago at an Extraordinary Summit held in Victoria Falls.

“We now need to isolate each mineral, and each agricultural product —one by one – in order to map out strands of value chains by which we transform our economy. Time has now come for us to make a start,” he said.

President Mnangagwa said Zimbabwe — like most African countries — had the dubious distinction of failing to exploit its natural resource wealth despite being highly mineralised.

Where production was taking place, he noted, the country was not deriving maximum possible value as minerals and agricultural produce was being exported either in raw form or semi-processed.

On the other hand, Japan posseses no iron ore but accounts for more than 10 percent of global steel supply. India and Europe produce very little gold but are responsible for nearly 40 percent of its beneficiation.

South Africa and Zimbabwe have 80 percent of the world’s platinum output but most of it is beneficiated in Japan, Europe and North America.

China, the US, Israel, Belgium and India beneficiate virtually all the world’s diamonds without mining a single carat at home.

President Mnangagwa said, “In agriculture for instance, Zimbabwe adds value and beneficiates locally only 30 percent of the cotton she produces. The rest goes abroad as raw cotton exports. Our textile industry is not just small; it is ailing.

“The story of tobacco is worse, with the country only able to process about two percent out of the more than 240 million kilogrammes it produced this last season. The rest goes out raw, with our tasty leaf being used as a blend for global brands.

“The story of soya and wheat is even more disheartening. There we have some processing capacity. Yet the country has not been able to produce enough of both as feedstock for this industrial capacity!

“We have tended to process what we cannot produce, even though we have everything necessary for that production,” said the President.

“Equally, we produce top-notch beef but have no leather and tanning industry to talk about. Countries like Ethiopia have a buoyant leather industry which exports to the rest of the world.

“In respect of minerals, we have almost all the minerals that drive world industries, but we have either not mined them, or mined them modestly.

“Certainly we have not processed them at all. This is what others have called ‘the resource curse’ of Africa, which Zimbabwe has not escaped.”

A holistic value chain for the mining sector would encompass the actual digging of minerals processing, refining, fabrication and marketing.

President Mnangagwa said creating such value chains required synergies with Diasporan Zimbabweans and investment in research, development and innovation.