Zimbabwe now has a new National Investment Policy (NIP) through which President Emmerson Mnangagwa’s government pledges to stop policy flip flopping, respect property rights as well as protect and promote foreign direct investment, among other things.
By Patrice Makova in Yokohama, Japan
The policy document was unveiled at the Zimbabwe pavilion during the three-day Tokyo International Conference on African Development (TICAD) 7, which ends in Japan today.
In formulating the new document, the government said it recognised that attraction of both foreign and domestic investment is imperative for the successful attainment of Vision 2030 which, among other things, is anchored around improved governance and the rule of law, upholding freedoms of expression and association, political and economic re-engagement with the global community as well as aggressively fight corruption.
According to the document, the new policy is a departure from the previous initiatives which merely focused on the promotion of inward foreign direct investment with a bias towards extraction of commodities, particularly in the mining sector.
“The pursuit of natural resource seeking investments, had over the years, resulted in very little developmental impact on the economy, as most of them merely focussed on the extraction and exporting of unbeneficiated and non-value added commodities,” it reads.
The new NIP claims it will seek to restore and sustain investor confidence through guarantees over investment protection, policy consistency and transparency throughout the entire investment management cycle.
“The implementation of the new National Investment Policy is central in ensuring security and protection of investors rights by committing the government of Zimbabwe to upholding laws and principles guaranteeing investment protection, which are consistent with contemporary concepts of the rule of law, the protection of rights, due process, compensation against expropriation and equitable treatment of foreigners,” the document reads.
It promises to guarantee investors of free remittance of such income as dividends and profits and increase the share of private sector investment, upwards of 25% of gross domestic product by 2030.
“In addition, the new National Investment Policy will also promote retention of investors by implementing a robust after care services strategy for existing investors to ensure that the overall investment climate remains attractive,” further reads the document.
The new policy recognises that foreign direct investment is positively linked to higher productive capacities in manufacturing, human resources and skills development, transfer of technology and know-how, infrastructure development and export competitiveness.
In this regard, initiatives that are promotive of business linkages between foreign investors and domestic suppliers will be implemented.
In a foreword, Mnangagwa said the launch of the new policy is alongside the commissioning of the Zimbabwe Investment and Development Agency (Zida) and unveiling of investment opportunities in the public entities sector.
He said key elements of the new policy include a thrust towards a more conducive business environment and inculcation of a business culture that attaches great value to consistency of policies that entrench investor confidence.
Mnangagwa said the policy which was crafted with the support of the World Ban, builds upon the Investment Policy Statement he launched ahead of the World Economic Forum in Davos, Switzerland in January last year.
“Lessons have also been drawn from other countries experiences, with useful insights of manners over best practice in attaining foreign direct investment learnt from Rwanda, through its Development Bank,” he said.
In an interview with NewsDay at TICAD yesterday, interim chairperson of the One Stop Investment Services Centre, Washington Mbizvo said the new initiative was not about promotion of investment only, but retention of current investors.
“We want to keep those investors. We want to show them more confidence,” he said.
Mbizvo said once Zida is operationalised through an act of Parliament, it will translate the new policy into action.
“So as soon as this is promulgated into an Act of Parliament you are going to see big changes in the manner business is conducted. Already we have the One Stop Investment Services Centre which is a precursor to Zida and now we are already implementing investment projects in a variety of ways,” he added.
Meanwhile, Japanese Foreign minister, Taro Kono met his Zimbabwean counterpart Sibusiso Moyo on the sidelines of TICAD 7 where he pledged his country’s readiness to support the southern African nation’s economic development.
“Zimbabwe has vast resources and Japan stands ready to increase trade and investment on mutually beneficial basis. We would like to support Zimbabwe and establish strong bilateral relations,” Kono said.
Moyo said Japan and Zimbabwe have a lot in common, including similarities in some vowels and verbs in Japanese and Shona languages, an area which need further research.