HomeNewsInvestor interest in Zim huge, but timing . . .

Investor interest in Zim huge, but timing . . .

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On Thursday, The Zimbabwe Investment Authority and South Africa’s Trade and Investment Limpopo (TIL) signed a Memorandum of Understanding in Harare to promote two-way investments, which have remained overly low nearly a year after Zimbabwe and South Africa signed a bilateral investment treaty.

In this article, NewsDay Business Editor Munyaradzi Mugowo (MM) talks to TIL’s CEO Motalane Monakedi (TIL) to explore the issue.

MM: In November last year, Zimbabwe and South Africa agreed on a Bilateral Investment Promotion and Protection Agreement (Bippa) with the two-pronged aim to promote cross-border investment flows and guaranteeing the investments.

But nearly a year on, there are hardly any investments to talk about apart from mere expression of interest.

Any idea why investors are so timid?

Does it mean that South Africa also shares the view that Zimbabwe is a risky investment destination?

TIL: No, not at all. To start with, our view as South Africa is that Zimbabwe is ready to do business with the rest of the world.

I say this because of the various processes and steps that are being undertaken to make sure that there is stability and conditions here in the country are conducive for investment and therefore for economic growth.

MM: Will you kindly name those processes?

TIL: As you are aware, the process started two years ago and culminated into the government of national unity in February last year. In November last year, Zimbabwe and South Africa signed an investment protection agreement in terms of which investments by whoever from wherever will actually be protected. So there is nothing like if I go there I could lose my money because the government will just take everything and will not want to . . . That particular agreement has given assurance to investors and to us as South Africa.

MM: Suppose, and I’m speaking in hypothetical terms here, expropriation by either party actually occurs, what sort of guarantees have you agreed?

TIL: There is discussion that government will compensate the investor. I’m saying if indeed it were to come to that. But that particular agreement is giving assurance to the investor. In this regard, it is clear that Zimbabwe is ready to do business with the rest of the world.

MM: If that is the case, then why is the flow of investments so low?

TIL: Well, I think it’s linked to some of the political processes that are still hanging . . . that are still underway. As you are aware, some Western countries are refusing to lift sanctions and that is a factor.

MM: In what way is it a factor?

TIL: Some of the investors may want to take cue from what the West is actually doing or not doing with respect to Zimbabwe. So for as long as sanctions remain, it means they must be cautious, it means they must not just rush in. So, that is why therefore at the recent meeting of Sadc, our President Jacob Zuma and other heads of state looked at the possibility of going out to meet with Western governments to lift these sanctions so that it can benefit all of us in Sadc.
MM: In other words for as long as sanctions remain, investors will continue to play wait-and-see?

TIL: What I’m saying is the conditions for investment in Zimbabwe are conducive, but investors who would like to come are not sure whether it’s the right time to come in because of the issue of sanctions. That’s why we have to deal with that as well. We have to preach the gospel that Zimbabwe is ready to do business with the rest of the world.

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