GOVERNMENT has conducted a study to review the regulatory environment in Zimbabwe as it moves to streamline processes to help in the ease of doing business.
BY VICTORIA MTOMBA
Speaking at the International Monetary Fund breakfast meeting senior economist, Ashok Chakravarti, said the country had so many legislations that needed to be removed.
The study is being conducted under the Office of the President and Cabinet (OPC) on the Ease of Doing Business reforms.
“We do not need all these regulations. The government is aware of this and we are conducting a study to review the regulatory environment in Zimbabwe and the study results will be out in the next three to four months,” he said.
The OPC has been working on the reforms on the Ease Of Doing Business which included Start-A-Business that had the World Bank and Strategic Economic Research and Analysis programme through the technical working group.
The review of the regulatory framework will include changing the Companies Act and reforming the Company Registration and Shop Licences Acts, all aimed at making the country move up on the rankings on the Ease of Doing Business.
Officialss said the review team had realised that regulatory bodies that include Zimbabwe Energy Regulatory Authority, Environmental Management Agency and others were milking companies and were not reviewing their payment structures yet companies were reducing prices and continuing to service obligations to the regulatory bodies.
Companies in Zimbabwe go through a lot of regulatory approvals before they start operating and this increased the cost of doing business in the country. Despite using the multicurrency system Zimbabwe has high cost structures and this has resulted in the country being ranked low in the Ease of Doing Business.
The country last year conducted the competitiveness study and it went through Cabinet and efforts were underway with internal devaluation happening throughout the economy.
Zimbabwe has been trailing its regional neighbours in terms of Foreign Direct Investment inflows (FD1). In 2014, Zimbabwe recorded FDI inflows of $545 million, the highest since 2009. Yet, the inflows were low compared to South Africa ($5,7 billion), Mozambique ($4,9 billion) and Zambia ($2,4 billion).
Government was working on a raft of doing business reforms to lure FDI. This has resulted in the country moving 16 places up the ladder to 155 out of 189 economies on the World Bank 2016 Doing Business index.
The jump was attributed to reforms on improving the availability of credit information through the introduction of credit scoring as a value added service to banks and other financial institutions.
It was also attributed to the strengthening of minority investor protection by introducing provisions allowing legal practitioners to enter into contingency fee agreements with clients.