Zimbabwe - Overseas Development Institute

competition. There would appear to be a chain of f a c t o r s that
together have r e s t r i c t e d export expansion: to export to the EEC
requires E E C - r e g i s t r a t i o n of the canning f a c t o r y ; t h i s has not
been obtained because the West Nicholson plant i s too small and
too o l d to meet modern standards; a few years ago the cost of
expanding and up-grading the f a c t o r y would have been about $1 1/2
mn but no d e c i s i o n has been made on going ahead with t h i s
investment programme. To some extent Lemco are i n a f a r b e t t e r
p o s i t i o n to export than Super Canners - they are part of a
worldwide corporation with a l l the mari'eting e x p e r t i s e t h i s
brings and, d o m e s t i c a l l y , they own s u b s t a n t i a l c a t t l e ranches
located near t h e i r f a c t o r y and so have d i r e c t access to the main
raw m a t e r i a l . On the other hand, there are problems of water
supply to the f a c t o r y at West N i c h o l s o n ' . The Super Canners
s t o r y shows that w i t h i n Zimbabwe are the i n g r e d i e n t s f o r h i g h l y
e f f i c i e n t food manufacturing which i s competitive worldwide; the
story of Lemco shows that e s p e c i a l l y with a captive and expanding
domestic market and wheredomestic p r i c e s are not out of l i n e with
border p r i c e s , there i s no guarantee that t h i s export p o t e n t i a l
w i l l be e x p l o i t e d ' ' ' .
I f one sets aside the i n t e r e s t i n g , but somewhat anomalous,
case of temporarily importing beef from Europe to send back i n
cans, i t does appear that there i s a large untapped p o t e n t i a l f o r
expanding Zimbabwe's resource-based food manufactured exports''^.
Besides the canned meat industry, t h i s i s i l l u s t r a t e d w e l l by the
plans and actions of Cairns Holdings, seen, f o r instance i n i t s
recent a c q u i s i t i o n of the former family f i r m of Border Streams,
processor of a wide range of jams, preserves, f r u i t and f r u i t
j u i c e s .
Border Streams i s one of some half-dozen privately-owned
firms i n the f r u i t and vegetable preserving/canning business i n
Zimbabwe. In s p i t e of quite f i e r c e competition among producers
f o r i n c r e a s i n g shares i n the domestic market ( a l l companies argue
that the market i s "over-traded") there has been l i t t l e expansion
of the i n d u s t r y as a whole i n t o the export market: i n 1983,
exports of jams, i n c l u d i n g pulps, were valued at $3,000, of f r u i t
j u i c e s at $22,000 and of processed vegetables at $2.7 mn. This
i s i n s p i t e of both Zimbabwe's a b i l i t y to grow t r o p i c a l and semit
r o p i c a l f r u i t s and v e g e t a b l e s ' " and the large and growing
markets i n the Middle East, the EEC and Japan f o r such processed
products which, i n the case of the EEC, could be imported under
the concessional terms of the Lome Convention. Three key f a c t o r s
appear have to have i n h i b i t e d export expansion. F i r s t , the lack
of a r e l i a b l e supply of high q u a l i t y products from the farming
community; second, the age, q u a l i t y and s i z e of the processing/canning
plants which were e s t a b l i s h e d f o r a smaller
domestic market, and, t h i r d , a reluctance on the part of management
to attempt to e x p l o i t these p o t e n t i a l export markets.
The case of Border Streams i s of i n t e r e s t because i t has
attempted to address each of these c o n s t r a i n t s . While the
takeover by Cairns was i n part meant to provide greater r a t i o n a l ­
i s a t i o n f o r more e f f i c i e n t production f o r the domestic market,
the r a d i c a l steps taken - moving the f a c t o r y to Mutare, i n t e g r a ­
t i n g the operation with i t s Tomanqo Foods operation i n Mutare to