An analysis of the performance of the manufacturing Industry in Zambia: The engineering manufacturing sub-sector

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Munakaampe, M. Grain
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The Zambian economy in 1964 was among the strongest in Sub-Saharan Africa. Through the years, however, it declined to among the weakest. The manufacturing sector's contribution to GDP declined from a peak of 30 per cent in 1992 to 24 per cent in 1996. The engineering manufacture sub-sector accounted for only 22 per cent of this contribution in 1971, peaking at 26 per cent (1975), but declining to 13 per cent (1996).This study analysed the performance of manufacturing particularly the engineering sub-sector in Zambia from 1964 to 1997. It identified the effects on performance of technology choices,product range, technical and management skills, and operating environment. It also examined the effects of government's economic policies on industry. Trends were compared at macro(sectoral) and micro (firm) levels by in-depth studies of some firms.Data collected was analysed using the Management Systems Analysis Model (MSAM), Statistical Methods (SM) and Total Factor Productivity Growth (TFPG) to determine sources of growth and/or decline in the performance of the manufacturing and engineering industries. Technologies employed by firms were analysed against the background of facility and job design, process variability, total quality management, level of labour skills, plant recapitalisation and modernisation, environmental and energy considerations. The manufacturing technologies in use were further compared with more advanced ones. It was found that TFPG contributed to the growth and decline of both manufacturing and engineering sectors. In both manufacturing sector and engineering sub-sector, there was rapid growth in output from 1964, but this growth declined after 1992 and 1982, respectively. Before 1991, government policies were commandist and did not encourage free enterprise and competition. Prior to 1991, it was also found that the energy crisis (1973), the Rhodesian border closure (1965), the freedom struggle in neighbouring countries and cost of spare parts affected the performance of the economy. However, after 1991, despite the liberalisation of the economy, there were no financial incentives for the struggling and emergent industries.Therefore, industry failed to re-invest in new and more efficient technologies, production methods and total quality management to meet the challenges of an open market economic policy in Zambia. Research and development were neglected both before and after 1991. From this study, it is recommended that both the government and industry need to play their respective parts, with government as a facilitator and formulator of policies conducive for growth of industry and industry itself taking initiatives that facilitate growth. Industrial initiatives must include research and development, investment into newer and more efficient technologies, improvement of existing facilities for better productivity and use of cheaper but sound raw materials. Organisational frameworks and information acquisition, generation, storage and dissemination must be improved. The report, further, concludes that unless this partnership between government and industry is recognised and exploited, all efforts by either the government or industry to resuscitate the economy will be futile.
Manufacturing Industry---Zambia