Zim to open door further to foreign investors

HARARE - Faced with a deep recession, Zimbabwe is looking to lure foreign investments in 2017, saying it will allow more foreign participation in its main market, in the latest step towards shoring up the country’s stuttering economy.

Macro Economic Planning and Investment Promotion minister Obert Mpofu, making the last statement of the year to the press, said he aims to repair ties with Western capitals frayed by his principal President Robert Mugabe, who has called the West “vile” for questioning his disputed 2013 re-election and vowing to press ahead with nationalist economic policies.

“The target is to achieve an investment level of 25 percent of the GDP. In this regard, the ministry has lined up investment road shows to Zimbabwe’s major investment source markets as well as the BRICS countries,” Mpofu said.

He said this was part of the ruling Zanu PF’s five-year economic blueprint, ZimAsset, which was supposed to steer the country forward at an average growth of 7,2 percent per annum.

The 129-page ZimAsset document, which details a five-year plan stretching to 2018 for the economy, details plans including the sale of bonds, securitisation of remittances, re-engagement with international finance institutions and the creation of special economic zones (SEZs).

Financing options were supposed to focus on Brazil, Russia, India, China and South Africa, a group of large emerging market nations collectively known as BRICS, but the plans have all fell through.

“The promulgation of the Special Economic Zones (SEZ) Act in October this year by ...Mugabe has marked a new era on the investment arena that shall witness the country receiving triple investment inflows beginning year 2017,” Mpofu claimed.

Mpofu noted that most BRICS countries gained their current outstanding investment levels because of the implementation of SEZs.

“The SEZs concept shall also be tailor-made for Zimbabweans living in the Diaspora. Zimbabwe is taking a cue from countries such as India and Ethiopia whose Diasporans contributed immensely to the development process of their countries,” Mpofu said.

“In this regard, the ministry will work in conjunction with line ministries to introduce Diaspora SEZs to facilitate the country to tap from the latent financial base which lies within the Diaspora.

To this effect, a Diaspora Directorate was set up within the ministry and a Diaspora Desk will be set up by ZIA (Zimbabwe Investment Authority) in order to ensure that SEZs models for the Diaspora are established in 2017.”

The ministry has already undertaken trade visits to Canada, South Africa and the United Kingdom in a bid to attract elusive foreign investment. Zimbabwe will also be launching an “Invest in Zimbabwe” handbook, to aid in the dissemination of information to investors.

“We want to assure the investing public that the ZIA will be re-branded and transformed into a fully-fledged One-Stop Shop (OSS) Investment Centre to meet world class standards for an effective and efficient investment agency in the first quarter of 2017,” Mpofu said.

“This shall be buttressed by the recent amendment of ZIA Act to legalise the setting up of OSS at ZIA and to allow investors to obtain investment licences within five working days.”

The one-stop-shop was set up in 2010, but has been missing set deadlines over the years. It was expected to bring increased efficiency on investors’ application, processing and communication with other government departments.

The delays in the investments approval process has been identified as part of a litany of reasons why the country was failing to attract significant foreign direct investment, which totalled $421 million last year, according to the UN Conference on Trade and Development’s 2016 World Investment Report.

“The OSS shall totally cut out bureaucracy and the tossing of investors from one office to the other. This will ensure that all investors are registered with ZIA and get efficient services from ZIA OSS,” Mpofu said.

Besides the aim of attracting foreign investment in Zimbabwean infrastructure, Mpofu also hopes local markets will be opened to foreign commodities.

It also comes as the economy is collapsing; cash and fuel supplies dwindling, and state coffers so dry that the regime struggles to pay salaries or bonuses to its henchmen in the police and army, with public-sector strikes, street protests, and desertions by key allies.

The prevailing cash shortages have not helped matters, with banks now giving out bond coins to depositors withdrawing cash, while withdrawing limits have been slashed to $50 or $100 per day, with the business community pointing out that the ruling party also needs to bring calm to jittery Zimbabweans.

Government has been warned that it could be in an inexorable path to financial meltdown if its profligate spending is not controlled.

Critics have also warned that Mugabe’s move to advance an “indigenisation” policy that forces foreign firms in the country, including mines and banks, to turn over majority stakes to local blacks, making it the centrepiece of his economic revival programme, was unpalatable to investors.

The 92-year-old president, whom many blame for ruining one of Africa’s most promising  economies, has insisted that his ruling Zanu PF party would not deviate from the black empowerment programme designed to increase black ownership across all sectors of the economy.

“This is the fight we must fight in an all-Zimbabwe way,” he said.

Comments (2)

We can name the initiative what we want but it is high time Zimbabweans in the diaspora consider themselves as foreign investors. If you are not aware there are a lot of foreign companies who have set their foot in Zimbabwe and are just waiting to pour money át the right time'. People in diaspora (I am one of them) need to put their feet into Zimbabwe and obviously not be careless with their hard earned money but let us not stand aloof and cry when the environment becomes conducive in Zimbabwe. Let us move from being newspaper commentators and act

Mburuka - 29 December 2016

Land reform indegenisation Zim asset Same old nonsense and none of it works!

Young Zimbo - 29 December 2016

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