Kudzanai Gerede Business Correspondent
Following President Mnangagwa’s maiden visit to the World Economic Forum in Davos, Switzerland last week, the country is poised for an improvement in Foreign Direct Investment inflows as the Zimbabwean leader grabbed the opportunity to present a positive narrative for the country during various meetings with key financial institutions representatives, and interviews on major media platforms spreading the message — Zimbabwe is ready for business.
The meeting with the International Monetary Fund chief, Christine Largade last Thursday was the major highlight as she welcomed the President’s commitment to stabilising the Zimbabwean economy and working towards normalisation of relations with the financial institution. After the meetings Largade took to Tweeter stating, “This was an opportunity to share views on ways to address the severe economic challenges that Zimbabwe is facing and how the IMF can help.”
Zimbabwe has not accessed external capital injection from International lenders since 1999 following years of international isolation under former President Robert Mugabe and failure to honour its debt obligations to IMF, World Bank and the Africa Development Bank. FDI figures have been receding prompting the need for reengagement with the international community.
In 2016, the country cleared 15 year-old financial arrears to the IMF and relations are expected to strengthen with the new administration. Analysts are buoyant that the Davos meetings came at an opportune time when the country had just finalised its Special Economic Zones and the Ease of Doing Business reforms which were essential for investment attraction.
Speaking at the Confederation of Zimbabwe Industries Economic Outlook Symposium in Harare on Tuesday, Zimbabwe Investment Authority (ZIA) head of operations Sichoni Takoleza said the country is geared for massive investment this year with approvals for investment proposals already showing the country can reach US$ 2.5 billion by year end.
“The new dispensation proves the right traction for FDI led growth in the wake of positive attitude already towards business by the Government. This shows Zimbabwe is now open for business. Given the observed developments in the investment environment, we expect approvals to increase this year and to record above US$ 2.5 billion in 2018,” he said.
This year so far, a strong South African delegation from the Industrial Development Corporation (IDC) came last week to meet vice President Constantino Chiwenga to commit investment in various industrial areas of the economy. Earlier, South African business tycoon, Mr Robert Matana Gumede who owns the Guma Group came into the country to cement a US$ 1.2 billion deal in sectors such as mining and manufacturing.
According to ZIA, investment approvals signed last year that will commence operations this year are highly concentrated in mining and manufacturing sectors amounting to US$ 576 million and US$ 488 million respectively, while energy services and construction totalled US$ 162 million, US$ 153 million and US$ 106 million respectively, with more expected through the course of the year.