The Zambia Association of Manufactures – ZAM has disclosed that the percentage of local products being stocked in the key chain stores in Zambia is currently sitting at only about 35%.
The key chain stores in Zambia include Pick n Pay, Choppies, Shoperite and Spar. No local Zambian store has been able to grow and scale to be among the top five at a national level after the privatization of state owned Mwaiseni and ZCBC chain stores, whose warehouses were mostly sold to shoperite.
This information has come to light following the Zambian government setting up a select committee composed of key industry associations and experts headed by Rosetta Chabala (former ZAM President and currently CEO of ZAMEFA).
The committee’s mandate is to review all products sold in chain stores with a view of coming up with a proposed list of products, which are currently being imported, that will be replaced with locally grown or manufactured products. The ultimate aim is to enhance the import substitution drive and saving up on unnecessary foreign exchange outflow.
Committee Chairperson Rosetta Mwape Chabala disclosed to the Zambian Business Times – ZBT in exclusive interview that there is a local content percentage for a product to qualify to be called ‘proudly made in Zambia’.
She said the ZAM standard for a product to qualify to be classified as a local product is in line with regional requirements of 35 -45%. Chabala sated that the committee will go with the requirements under the rules of origin in COMESA which is 35% value addition while in SADC its 45% value addition. she however stated that In fact, under the Proudly Zambian campaign, the preference is for 50% value addition.
When asked if ZAM or Zambia laws have a pre-set percentage to guide the process of determining the locally made or manufactured products as opposed to locally assembled products? Chabala stated that Zambia is guided by the rules of origin and the Zambia Trade and Industrial policy, which is able to differentiate the difference between assembling and manufacturing.
“It is also important to note that some lines are doing very well especially those by producers who have capacity to produce quality and to scale. She told ZBT that some of the product lines which are doing well and need to be further consolidation include fruit and veggies, meats and poultry, soaps and detergents, honey, dairy etc,”.
Chabala further confirmed that the committee has received the list of all products being imported by top chain stores in Zambia and that the committee would work in a phased manner and start with the Agro sector.
So far the committee has only worked on fruits and veggies and then will be moving on to dairy. She said a lot of fruits and veggies have so far been identified for import substitution either by growing more or by extending the farming and production season beyond the rainy season. Some of the products identified for import substitution include Kumquats, litchis, oranges, Pineapple Queen, Beetroot, Brocolli, Brussel, Carrots, Mushrooms (white and brown), onions, etc.
She added that the committee is working in a phased manner therefore, manufactured products will be last and almost towards the end of the year as it is currently working on agriculture – fruit and veggies, next is dairy and processed meats and then conclude with manufactured items and textiles.
The local manufacturing sector is today said to have been outrun by imported raw, semi-processed, processed and finished products. There is need to identify specific products that can be locally grown, processed and manufactured to develop a viable manufacturing industry in Zambia.
