The Zambia Association of Manufacturers (ZAM) has taken swift action to establish an Anti-Illicit Trade Committee to feed into the efforts of the Government in addressing illicit economy in Zambia and its negative impacts on business and the Zambian citizens at large.
This follows the release of the findings of the Euromonitor Market Analysis on Illicit Alcohol in Sub-Saharan Africa on Friday 26th October 2018 at the launch of Zambian Breweries Mentorship Programme.
In 2016, Zambia lost $53.6 million to illicit trade in the alcoholic beverages sector alone, in 2017 this figure more than doubled to over $145 million in fiscal losses to the Government – highlight a glaring area for intervention.
Notably, this represents the losses in just one sub-sector of the multiple sectors affected by illicit trade.
ZAM Chief Executive Officer Chipego Zulu says the move has been necessitated by the recognition that Zambia is indeed strategically located not only to foster intra-Africa trade of licit/legal commodities, but rather, that given its strategic land linked position, Zambia has and continues to serve as a hub for illicit trade with millions of kwacha being lost to illegal channels in the form of smuggled products.
Ms Zulu laments that rampant smuggling is due to a number of factors including but not limited; information asymmetries between the public and private sector actors, and inadequate enforcement of existing policy frameworks to curb illicit trade.
“In this regard, ZAM will over the last quarter of 2018 establish a fully functional Multi-Sectoral Anti-Illicit Trade (AIT) Committee to provide evidence for action to key regulators and enforcers such as the Zambia Revenue Authority (ZRA) and the Drug Enforcement Commission (DEC) towards the adoption of practical measures to arrest the growing illicit trade problem in Zambia. Furthermore the Multi-sectoral AIT committee will provide input for policy development to the Ministries of Commerce, Finance, Health a Local Government (amongst others) towards the creation of a responsive Anti-Illicit Trade Strategy for the country,” she said.
She explains that the Committee will encompass representation from a broad range of sector representatives including but not limited to; manufacturers of fast moving consumer goods such as; beverages, processed and refined foods, edible oils, alcoholic beverages and tobacco products amongst others.
The ZAM CEO has since commended the Government on the measures they have been taking so far to address illicit trade including trade facilitation measures such as the creation of one-stop border posts, initiating the migration of trade procedures to E-Systems to enhance efficiency and compliance, as well as the introduction of other key measures such as digital tax stamps to track products and ensure compliance.
She however notes that given the exponential and worrying growth of illicit trade, there is need for renewed efforts towards arresting its progressive and negative impact on the country.
“Zambia Association of Manufacturers looks forward to enhancing its engagement with various policy makers and enforcers to ensure that a level playing field is created for industry to thrive by putting in place and further strengthening the necessary measures to curb illicit trade,” she said.