THE Small-to-Medium Enterprises and Co-operatives Development ministry has signed a memorandum of understanding (MoU) with the South African Trade and Industry ministry to fund the revival of targeted distressed Bulawayo companies.
South African Trade and Industry deputy minister Elizabeth Thabethe told Southern Eye on the sidelines of an industry and trade initiative conference held in Bulawayo on Thursday that reviving targeted companies was expected to start this year.
“We have entered into an agreement to look at possibilities to help in the revival of distressed companies in Bulawayo,” Thabethe said.
“We are looking at working with five companies in a joint partnership starting from now until 2014.”
Bulawayo has suffered massive deindustrialisation after close to 100 companies shut down last year because of lack of working capital, among other reasons.
The city’s industry needs an estimated $400 million in the short term to recapitalise.
Thabethe could, however, not disclose the actual investment in terms of monetory value South Africa will channel in the partnership, although she revealed that the project would be partly bankrolled by the Industrial Development Bank of South Africa.
She said the MoU also included training and incubation programmes for small-to-medium enterprises in Zimbabwe aimed at helping reverse deindustrialisation.
The South African government adopted a bilateral trade strategy for economic engagement with Zimbabwe in 2009 with the objective of achieving economic growth and development through outward investment facilitation, infrastructure development and trade liberalisation.
Thabethe said the recently-launched Zimbabwe Industrial Development Policy has positioned the country as an attractive zone to foreign direct investment.
South Africa remains Zimbabwe’s biggest trading partner.
Trade between the two countries amounted to R18,8 billion last year, up from R16,5 in 2011.
However, Zimbabwe remains a net importer of goods and services from South Africa as local industry fails to meet demand.
Thabethe said South Africa will play a critical role in the revival of the manufacturing sector in Zimbabwe.
“South Africa intends to utilise it capabilities in the environmental technology and its world-class Information communication Technology to contribute in the Zimbabwe economic recovery,” Thabethe added.