Multicurrency system affecting Zimglass performance

Published: 09 December 2013

ZIMBABWE Glass Company, the country's sole flint glass producer, says it is facing severe competition from foreign-based companies that take advantage of purchasing power parity in their countries.

"Competitors elsewhere pay running expenses in their local currencies and export in hard currencies which is an advantage to them as they can access the local currency easily. While on the other hand for Zimbabwe, we use the US dollar throughout and this makes it difficult to compete" said Zimglass acting chief executive officer, Gilbert Tapfuma.

Last month the company suspended its operations on grounds of lack of raw materials due to low working capital levels "We have limited working capital and as a result we have not been able to get the raw materials as and when we want them.

We are appealing to Government to avail funds to support industry. We are also experiencing a decline in demand since we only have Delta as our main consumer," he said.

Tapfuma said Zimglass was working on identifying new markets in the region with the main target being Zambia where there is high demand of flint glass which is used to bottle soft drinks.

Zimglass generally needs an overhaul of its business model to resume operations on a competitive basis.

In as much as it is acknowledged that the company needs financing, it is important that the business modal be vigorously evaluated so as to fit the global market andattract more customers, surely it is not worth it to depend on one customer Delta as they mentioned there is the critical need to expand the market and to do that strategies need to be formulated that will enhance the company's competitiveness.
- bh24

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