Zimbabwe edible oil producer URL backs government business reforms

ZIMBABWE – United Refineries Limited (URL), one of Zimbabwe’s largest cooking oil refineries, has praised ongoing Government policy interventions aimed at reducing the high cost of doing business.

The Edible oil processor management expressed appreciation for these initiatives during a visit by the Parliamentary Portfolio Committee on Industry and Commerce, led by Zaka South legislator Clemence Chiduwa.

These interventions, including tight monetary and fiscal policies, have significantly narrowed the gap between the formal and parallel market exchange rates from over 50 percent last year to approximately 25 percent.

Recently, Finance, Economic Development and Investment Promotion Minister, Professor Mthuli Ncube, announced plans to streamline taxes and review regulatory compliance costs to improve business viability.

This follows President Mnangagwa’s directive for statutory bodies to adjust their charges and regulatory requirements to support business growth and investment instead of stifling them. The visit was part of a nationwide fact-finding mission assessing the ease of doing business across Zimbabwe.

As one of the country’s largest cooking oil refineries, URL boasts a refining capacity of 12,000 tonnes per year from soybean seed, alongside producing 9,450 tonnes per year of laundry and bath soaps and 30,000 tonnes per year of stock feeds.

The company employs 263 full-time staff and engages around 100 seasonal workers monthly, depending on production needs.

Beyond its branded product lines, URL manufactures essential by-products such as soya meal and soya bean cake, which are widely used in poultry and pig farming.

Additionally, it produces soya bean hull, a high-fiber by-product ideal for cattle, chicks, and mushroom cultivation, with annual by-product production reaching 30,000 tonnes. The company has also diversified into rice, maize meal, and noodle production.

During the committee’s tour, Benjamin Blatch, URL General Manager acknowledged that the shrinking gap between parallel market and official exchange rates had contributed to lowering business costs.

He highlighted that exchange rate stability, particularly since the introduction of the Zimbabwe Gold currency in April last year, had reduced inflation, improved business planning, and enhanced pricing predictability.

“We are seeing the disparity between informal and formal exchange rates converging, which is allowing better conversion through the willing-buyer, willing-seller system, which we appreciate. We look forward to a stable environment,” said Blatch.

Despite these improvements, he pointed out that URL still faces challenges in securing raw materials due to global logistics delays, border inefficiencies, and working capital constraints.

On his part, Clemence Chiduwa, Portfolio Committee Chairperson commended URL’s efforts to grow its operations and strengthen Zimbabwe’s edible oil value chain, which helps reduce reliance on imports and supports local industry.

“We came here to assess the ease of doing business, particularly at URL. We are impressed by their diversified portfolio and commitment to growth. URL’s current capacity utilization is at 52 percent, and they have raised key issues, such as the exemption of plastics from taxation and zero-rating them to allow for VAT claims,” Chiduwa said.

He also addressed working capital concerns, noting that URL had benefited from the Reserve Bank’s Targeted Finance Facility (TFF) but emphasized the need to expand the facility to provide more support to businesses.

“The TFF facility is crucial in redistributing liquidity to where it is needed most. Expanding this facility could help businesses like URL overcome working capital challenges,” he added.

Chiduwa further highlighted that URL welcomed the Government’s progress in closing the gap between official and parallel market exchange rates. However, he acknowledged that the high cost of doing business, particularly due to electricity shortages, remains a significant concern.

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