Government plans to sign Bilateral Investment Promotion Protection Agreement (Bippa) with emerging markets Brazil, Russia, India, China and South Africa (BRICS) as the country is most likely to benefit from their investment.
Speaking at a the launch of the World Investment Report 2011 on Tuesday, Minister of Economic Planning and Investment Promotion Tapiwa Mashakada said the country is looking forward to concluding Bippas with India and Botswana by year end.
“We are trying to move away from Bippas that don’t give us anything. The BRICS are our favourites and we want to make sure that we have Bippas with them,” he said.
“The negotiation for the money is done by the Ministry of Finance. We are working on the South African line of credit. It’s not easy for the money to come.”
Mashakada said government would focus on non-equity investments to enable investors who do not want to have high exposure to Zimbabwe to look at other ways of doing business with minimum risk.
The report was launched under the theme “Non-equity modes of international production and development”.
“There is commitment from government to engage investors who are looking at non equity investment like franchising, licensing, management services contracts, contract farming, and other relationships which are not necessarily Foreign Direct Investment(FDI) and trade,” he said.
Zimbabwe has been failing to attract adequate FDI due to high country risk and has recorded a sharp decline compared to other countries in the region.
The country’s FDI remained stagnant at $105 million in 2010 according to the investment report.
The country’s FDI declined from $444 million in 1998 to $60 million in 2009 while Zambia, Mozambique and Namibia have been recording significant FDI inflows.
Mashakada said the World Investment report theme on non-equity modes of investments should assist the economy.
The economy is expected to grow by 9,3% this year from 8,1% in 2010.
Addressing delegates at the launch, Zimbabwe Investment Authority chief executive officer, Richard Mbaiwa said the global FDI has not recovered fully from the pre-crisis level but seems likely to do so this year.
Global FDI flows rose to $1,24 trillion in 2010 and is projected to rise to between $1,4 and $1,6 trillion in 2013.