HARARE - Government must implement policies that enforce investor protection if it is to attract meaningful foreign direct investment, the Zimbabwe Investment Authority (Zia) said.
This comes as lack of respect for property rights, coupled with the indigenisation policy, are among the major factors that have rendered the investment-starved country investor unfriendly.
Zia is a government investment promotion body that also facilitates foreign investor registration.
The authority’s chief executive Richard Mbaiwa said there was need for policy consistency and harmonisation to offer investors security and stability.
“Zimbabwe has a plethora of investment laws which may need to be harmonised,” he told a Special Economic Zones (Sez) workshop, jointly organised by World Bank, United Nations Development Programme and the African Development Bank.
Mbaiwa said government should come up with an effective investment promotion, coordination and regulation body especially in view of envisaged Sezs.
His call comes as last month British deputy ambassador to Zimbabwe, Chris Brown, said investors remain worried about the perceived lack of respect for property rights and uncertain business climate in the country.
“If the government doesn’t soon articulate a really clear approach on achieving empowerment and respect property rights, Africa, I fear, will continue to rise without Zimbabwe,” he said.
Brown said Zimbabwe had potential to attract more investment than most African countries but remained hamstrung by unfriendly policies and environment.
Meanwhile, Finance minister Patrick Chinamasa said his ministry would use the document to be produced by the workshop on Special Economic Zones to draft new policies to attract investors.
“The major thrust of Special Economic Zones is to run with speed along the path to industrialisation. We want to attract investment, domestic and foreign, and we are here to listen to what it is, as government, that we need to do to respond positively and attract their capital, skills and technology,” he said.
“We need to look at the incentives that we are offering investors and the discussion going on here will produce a document that government will have a look at with a view to adopting it,” added Chinamasa.
Zimbabwe is facing one of its worst de-industrialisation crises as many companies are closing down due to economic challenges.
The export-oriented sectors, particularly manufacturing, have not realised meaningful investment over the past three years, according to the Confederation of Zimbabwe Industries.
The Special Economic Zones follow a similar concept to the Export Processing Zones (EPZ), established in 1987 through an Act of Parliament.
The EPZ programme was managed and administered by the Export Processing Zones Authority.
However, the formation of the Zimbabwe Investment
Authority through the Zia Act repealed the Epza Act, which was the legal instrument governing the operations of Epza.
The move meant that, administratively, the programme could not continue to run.
By 2004, projects under EPZ had created over 32 000 jobs and $172 million worth of investments.
The EPZ incentives, which were used under the four instruments of the Finance Act were the Income Tax Act, Customs and Excise Act, Capital Gains Act and Value Added Act.