By Patience Moyo
Zimbabwean companies are taking part, for the first time, at this year’s edition of the annual trade fair of Mozambique.
The 12 Zimbabwean companies, who are participating for the first time under ZimTrade’s banner, will engage with potential buyers from Mozambique, as well as potential business partners who will also be taking part in the Maputo International Trade Fair also known as (FACIM).
Business to business meetings will also underly the participation of the companies at the trade fair.
Participating companies are drawn from sectors such as agriculture, building and construction, manufacturing, processed foods, and leather and leather products.
FACIM is a multi-sector trade fair in Mozambique which seeks to promote business opportunities with various brands, services and products.
It brings together major industry players, innovations and market trends and offers a unique business platform that allows participants to expand their network of business contacts and enter markets.
FACIM presents local companies with a platform to engage with potential buyers and expand their footprint in the regional market.
For participating Zimbabwean companies, the objectives of attending the Fair are to diversify Zimbabwe’s exports, establish new leads in the Mozambican as well as the regional and international markets and to also increase exports of Zimbabwe’s products to Mozambique.
Mozambique by virtue of its proximity to Zimbabwe creates good logistics options for Zimbabwean companies, as they can tap into the regional market with competitive costs of their good and services.
Several Zimbabwean companies through the ZimTrade export promotion activities have made inroads in Mozambican Provinces like Tete, Chimoi and Manica over the years, riding on the good relations between the two countries.
Zimbabwe and Mozambique have bilateral trade agreements and are both members of the SADC Trade Protocol.
These trade agreements are meant to support and encourage trade between the SADC countries to reduce customs duties and other barriers to trade on products and services from both countries.
The focus of the trade agreement between Zimbabwe and Mozambique, which has been in place since coming into force in 2005, is to eliminate tariff and non-tariff barriers and to cooperate in customs and trade promotion.
The agreement provides for duty-free trade between the two members with the rules of origin specifying a 25 percent domestic value added.
Excluded from the agreement are refined and unrefined sugar, Coca-Cola/Schweppes soft drinks, firearms, ammunition and explosives, motor vehicles and cigarettes.
BOXED: Accessing the Mozambique market
Overall Zimbabwean companies are encouraged to have local representation in Mozambique.
This could be working through distributors or to open distribution offices or warehouses in key markets.
Product adaptation is also key especially on packaging and labelling which require Portuguese translation.
There is need to ensure that all products can are labelled in Portuguese as this can determine the success of failure in the market, even when negotiating for deals.
Focus should also be on the middle and northern provinces were Zimbabwean products can effectively compete with south African sourced products, especially on pricing.
For Zimbabwean companies to make a breakthrough into the Mozambique market, a medium to long term strategy coupled with local partnerships is recommended and this includes the establishment of warehouses which are a core part of the infrastructure necessary to facilitate the functioning of the products supply chain.
It is also important for Zimbabwean companies to be innovative and work on product quality and quantity improvement as well as market penetration strategies, which can result in tapping the Mozambique market at the same time exploiting the new opportunities that the country offers.
As globalisation and international trade grows, so does competition for markets and overseas companies are posing a threat to the existence of most Zimbabwean companies as they struggle to withstand the competition and secure market share.
Local companies need to develop new business models and work together in consortiums, both SMEs and large companies to gain access to the Mozambique market that is reflecting great potential.