Thorough scrutiny needed of ‘mega deals’

IN the past few days, the mantra from the government is mega deals, a throwback to the last few years, when authorities where said to be signing one deal after the other.
On the other hand, Reserve Bank of Zimbabwe governor, John Mangudya and Finance minister Patrick Chinamasa were said to be in China recently, where they were looking to renegotiate loan repayments.

For the past few years, the buzzwords were Lima plan, as the State sought to make good on a plan to repay the World Bank and the African Development Bank.

Where all these plans to pan out, there is optimism that the country’s economy will rebound and thrust Zimbabwe on a development and growth trajectory.

However, little is said about the debt that the government is incurring and what it means to the already overburdened taxpayer.

While the country needs investment, authorities run the risk of being seen as too desperate and that will open up the country to vultures that will take advantage of Zimbabwe’s desperation.

There needs to be scrutiny into all the deals that Zimbabwe is entering into, so that the country gets the best out of them, without it losing too much.

Parliament ought to have an oversight role into the deals Zimbabwe is entering into to avoid the country being taken advantage of.

This is not to say that the country should frustrate investors, but rather every investment ought to be scrutinised and this way Zimbabwe will be the winner.

Scrutinising every deal would also discourage potential bargain hunters, who are seeking to enter the Zimbabwean market on the cheap and then sell off assets for a profit prejudicing the country of real investment.

Zimbabwe needs the money and investment, but it also needs the best deal possible.

Thus, we urge authorities to be thorough when engaging into agreements, to ensure that the country is not prejudiced in any way.

When entering into these deals, the government needs to engage experts and lawyers to do the negotiations and scrutinise the final documents they agree on to ensure that Zimbabwe is the ultimate beneficiary.

If this is done properly, future generations will not have to pay the price for this generation’s failures, but will inherit a prosperous nation.

3 Comments

  1. Beggars are seldom winners. If we had a solid plan it would have all the safeguards required to ensure fairness, but we seem to be begging more than we are ready to negotiate. We have one of the largest reserve bank buildings in the world which is empty of “reserves”.

  2. The eagerness to show results before the election will indeed result in bad deals and bad prioritization of projects. I really wonder for instance about the quality of roads being resurfaced. It may be a case of do as much as you can with available resources never mind the quality.

  3. ED has my vote

    I actually think that if as a country we have a good and fair tax code there is no way the country can lose. On each investment the government stands to make money through corporate tax (25.75% of profits), PAYE (Levied on all employees), VAT e.t.c e.t.c. If we were to do a value added analysis of the average companies revenues you would find that almost 15% of a companies revenues end up with the government. So I do not necessarily believe that there is any such thing as a bad investment when it comes to FDI. Honestly I don’t.

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