Choppies Enterprise Limited, a leading Botswana retailer, is considering withdrawing from Zimbabwe as its local subsidiary impacts the group’s financial stability.
The strain is linked to the instability of the Zimbabwe Gold (ZiG) currency, introduced in April to replace the Zimbabwe dollar. Choppies owns 100% of Nanavac Investments (Pvt) Limited, which operates Choppies Zimbabwe.
In its annual report for the period ending June 30, 2024, Choppies noted that while operations in Zambia are stabilizing, Zimbabwe remains a challenging market. The new ZiG currency has failed to stabilize the economy, leading to declining performance.
Choppies employs 11,388 staff across 287 stores in Botswana, Namibia, Zambia, and Zimbabwe, with 1,051 in Zimbabwe alone, raising concerns about potential job losses if the company exits.
CEO Ramachandran Ottapathu emphasized the need to reduce debt and acknowledged ongoing economic challenges in Zimbabwe, including high inflation and unemployment. As of June 30, 2024, Choppies reported BWP128 million in assets against BWP122 million in liabilities.
The economic outlook for Zimbabwe is grim, with real GDP growth projected at 1.9% for 2024, influenced by reduced agricultural output and persistent power cuts. Approximately 45.3% of the population requires food assistance, further squeezing consumer spending.
Choppies is actively reviewing its options in Zimbabwe amid these financial pressures.
NewsDay