GOVERNMENT is looking to Special Economic Zones to help stimulate foreign direct investment into the country, as it seeks to replenish the declining foreign currency in the economy.
BY TATIRA ZWINOIRA
The Special Economic Zones Act was signed into law on October 30, 2016 by President Robert Mugabe and enacted sometime in December of the same year.
Speaking at the launch of the 2017 Economic Outlook, Macro-Economic Planning and Investment Promotion permanent secretary Desire Sibanda said the Act would speed up foreign direct investment into the country.
“The introduction of the Special Economic Zones Act is expected to increase exports in the manufacturing sector. We are working towards getting the Special Economic Zones Act to attract investment and the reduction of the wage bill is critical to that effect. The private sector is being called upon to help government enact the Special Economic Zone Act,” he said.
“African economies that have registered economic growth rates above 5% have special economic zones (SEZ). We do not need to think that it is going to take time to implement the Act (Special Economic Zones Act). What is needed is for us to focus on implementing the Act. We will be advertising the Act to local and foreign press to let them know that we are offering internationally competitive incentives.”
The Special Economic Zones Act supports the creation of SEZs. The goal of the Act is to attract investors by allowing them to operate in Zimbabwe under incentives.
Foreign investors operating under these SEZs will receive exemptions and incentives in certain aspects, which include a tax reduction for companies exporting at least 50% of their wares.
The plan by the ministry of macro-economic planning is to have the Act reduce unemployment, improve government revenue collection and ultimately contribute to the gross domestic product through its implementation.
According to the 2017 Economic Outlook, the critical growth sectors have been heavily influenced by current foreign currency shortages. Other factors include the high cost of production, unsustainable wage bill, trade deficit and a debt stock which is 80% of the gross domestic product
Sibanda said a Chinese delegation is expected into the country to discuss more on SEZs.
He said they would be embarking on a serious advertising campaign to both local and foreign media to alert the foreign investors of the Special Economic Zones Act in order to lure them to the country