THE Zimbabwe Investment Authority (ZIA) approved projects valued at over $6 billion more than a year ago, but most of them have not taken off due to a myriad of challenges, according to the authority’s chief executive officer Richard Mbaiwa.
Report by Victoria Mtomba
The approved projects cut across the manufacturing, agriculture, mining, transport, tourism, construction and services sectors.
Of the total projects that have been approved, the bulk of the projects were from infrastructure and power development.
“Regarding the implementation of approved investments projects, this is something we are working on to improve rate of conversion from approvals to actual investments on the ground. For example, the plus $6 billion worth of approvals in 2011 was made up of some big projects such as Essar (New Zim mining and New Zim Steel), some integrated tourism projects in Kariba and Mutirikwi, infrastructure and power development projects,” Mbaiwa said.
“These may be facing one or two challenges. Because of their nature, big projects have a longer gestation period,” he added.
He said the investors for the tourism projects in Kariba have been issued licences and the authority was awaiting the investors’ response, while infrastructure and power development projects were scattered in the country and were at various stages towards implementation.
“The infrastructure and power development projects are all over and implementation is going on, but at a slow pace,” he said.
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The $750 million Essar deal was one of the deals that the government struck with Indian investors in 2011, but is yet to be implemented due to haggling in the inclusive government. The deal was expected to create 3 500 jobs and revive Ziscosteel that was non-operational, but has remained in limbo.
Chisumbanje ethanol plant set up by Green Fuel has also faced its fair share of challenges that has resulted in it being shut down for extended periods. The $600 million project has been a subject of debate in the government, leading to the setting up of a Cabinet taskforce chaired by Deputy Prime Minister Arthur Mutambara to try and resolve the impasse.
On a monthly basis, the authority compiles information on investment approvals, but there has not been much implementation progress.
NewsDay Business established that in the past, however, the approvals materialised quickly, with the country peaking at $1 billion in 1998.
The country has been failing to attract considerable investment although foreign direct investment has been on a recovery path starting at $65 million (2009) and moving to $166 million (2010), $387 million (2011) and $450 million (2012).
Zimbabwe is ranked 128 in Doing Business Rankings (2013) on investor protection, which was a downward trend from 2012, an indication that investors are wary of financing projects in the country. On the World Bank’s Starting a Business Rankings, it was at 143 out of 185 countries.
In a move that was aimed at mopping up the country investor perception, President Robert Mugabe in 2010 launched the One Stop Shop at the ZIA offices with a motive to reduce the number of days and offices that are visited by investors when they want to invest into the country, but this seems to have yielded little results.
