ZIMBABWE’S ambition to become a competitive investment destination is being held back by investor fears surrounding currency instability, unpredictable policies and complex regulations, a top official has revealed.
Zimbabwe Investment and Development Agency (Zida) chief executive Tafadzwa Chinamo told delegates at the just ended Southern African Insurance Indaba that without urgent action to address these risks, even the most promising investment opportunities could fail to materialise.
“There are certain risks that investors tell us need to be managed,” Chinamo said.
“The first one is currency and profitability risk.
“This is about predictability and the frictionless repatriation of profits.”
He identified the other two major hurdles as a lack of policy and regulatory predictability, as well as compliance complexities.
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Chinamo indicated that unexpectedly policy shifts elevate the political risk profile for businesses, driving up the demand for specialised insurance coverage.
He stressed that investors require concrete assurance that their capital can be safely realised and reinvested.
“Investors need not only the existence of rules, but also the ability to understand, implement and comply with them efficiently.”
Chinamo outlined the reforms Zida implemented to streamline the investment process.
Investment licences that previously took over a month are now issued within five days, with a target of one to two days.
Processes have been digitised for transparency and an investor grievance response mechanism has been established to resolve disputes quickly.
Chinamo pointed to significant opportunities in credit insurance to unlock trade finance, carbon credit insurance to tap into green finance and leveraging on domestic pension funds for long-term infrastructure projects.
“We can literally pressure policymakers where necessary, but our positions must be researched and the insurance sector must be at the centre of this.”