HARARE: Nestle Zimbabwe commissioned its milk powders and Cremora plant yesterday after refurbishing and upgrading the plant at a cost of $8 million to increase its production capacity.
The facelift and capacity expansion expanded the plant’s production capacity to 1,600kg from about 900kg for the creamer and 1,500kg from 900kg per hour for the milk powders.
In terms of Cremora, a coffee creamer, the food processor will have capacity to produce 7,500 tonnes per annum against demand of 12,500 tonnes, met through informal imports.
Industry and Commerce Minister Mike Bimha, who was guest of honour at the commissioning event, commended Nestle for investing in capacity expansion when other companies are struggling or closing due to lack of funding to retool.
“Nestle Zimbabwe’s resilience in a difficult environment is a positive story and is testimony to other potential investors that Zimbabwe is a safe destination for investment.
The Swiss headquartered foods processor has invested about $30 million towards increasing capacity and enhancing efficiency over the last four years, Nestle Equatorial Africa South cluster manager Ben Ndiaye said yesterday. Minister Bimha said lack of funding to recapitalise is affecting the competitiveness of the local manufacturing industry.
“Such commitments can only be achieved through collective and concerted efforts between government and the private sector,” the minister said, adding “lack of investment in new machinery has been identified as one of the factors inhibiting competitiveness in manufacturing sector.”
The current local capacity utilisation in the manufacturing sector, the minister said, has resulted in an influx of imported goods mostly from the region, causing unlevel playing field.
But Nestle’s investment over the last four years was aimed at increasing production capacity; create jobs and exports to Zambia, Malawi and South Africa, increasing foreign currency inflows into Zimbabwe, which suspended its local unit.
The Swiss food, health and wellness company has also played a major role in the industrial value chain after the company invested $11 million to revive the dairy sector.
“You’re encouraged to keep up the good work of supporting the farmers. I implore the other players in the sector to emulate your strategies in supporting the primary sources of inputs in the milk value chain,” the minister said.
Minister Bimha said the government has rendered support to industry through various measures which ring fenced approved manufacturers to import powdered milk under special duty.
This has been done through removal of certain critical products from the open general import licences and for such products, licences are now required before importing.
He said that the government is looking at issues plaguing competitiveness from the perspective of the ease of doing business to assist industry towards becoming more competitive.
Ndiaye applauded the government for the fruitful cooperation and the strong support the company continues to receive from the ministries of agriculture, industry, health and education as well as the department of immigration.
“It’s good to feel welcome and for the government to willingly extend its services for the necessary collaboration to make the company and the economy grow,” Ndiaye said.
He said that the economy is made up of companies such as Nestle, which invest every year in new equipment and churning out products for local market as well as export markets, creating employment and promoting industrial value chains.
Over and above its $30 million investment at its factory, Nestle launched a dairy empowerment scheme in 2011 with the main objective being to help rebuild the dairy industry.
Only last week, Nestle handed over 100 pregnant dairy heifers to 20 small scale farmers in Chitomborwizi, Zvimba, and financed them in growing maize silage to reduce production costs. The farmers first underwent thorough training.
“Nestle has been in Zimbabwe for over 56 years in both good and challenging times, positively contributing to the economic growth and employment creation in the country,” he said.
Ndiaye said the new investment was meant to ensure the company sustains its investment through programmes that also create share value between communities and Nestle through local manufacturing activities.
He said the company is also investing in capacity training of future leadership, to carry forward the vision, through the Nestle Leadership academy, which has already produced business leaders from Zimbabwe in Zambia and Malawi.
