Harare - Zimbabweans love the sweet things in life and they are increasingly switching to expensive wines and ciders while also taking up subscriptions to pay television DStv despite the country’s continued financial woes.
Nearly all the country’s companies are struggling to maintain or grow profitability, with capacity use in industry and manufacturing sectors remaining below 50 percent, according to the Confederation of Zimbabwe Industries (CZI).
However, it appears that Multichoice is raking in the revenues from pay television subscriptions .
Another soaring company is African Distillers (Afdis) - the local associate unit of Distell - which has reported surging volumes and revenue from wine and cider sales.
“Increased market place acceptance of our wine brands spurred growth in this category, registering volume growth of 29 percent. “All product categories registered volume growth, with ciders well ahead of other segments at 40% over the prior year,” said Pearson Gowero, chairman of Afdis.
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The company said its revenues for the full year to the end of December had increased 10 percent to $14 million (R182 million). Although Delta Corporation, the local unit of the merged SABMiller and AB InBev entity, has been recording declines in lager beer and soft drinks sales, Afdis has also recorded strong recovery in the spirits business, “compared to previous periods”.
Despite the revenue uptick, Gowero said the poor economic performance had retarded the company from attaining its full revenue potential as spending was limited.
Apart from guzzling wines, ciders and beers, Zimbabweans have been ditching state-owned broadcaster, the Zimbabwe Broadcasting Corporation, and switching to Multichoice’s platform.
Reserve Bank Governor John Mangudya this week criticised Zimbabweans for spending too much money on satellite television subscriptions.
Illogical
Mangudya said the $45 million paid on subscriptions should be used to import raw materials.
“Spending more foreign exchange on DStv subscriptions than on raw materials to produce cooking oil, for example, is not only counter-productive but also illogical.” Zimbabweans have also been spending too much from their credit cards, with the central bank saying $206 million has been splurged on credit cards and satellite television.
Economists said this showed the widening of the gap between the poor and the rich in the country, also pointing to new recreation centres opening up.
The government is now tightening the screws on “unnecessary” spending of foreign currency.