Zimbabwe is open for business and investing in the country is not as risky as many think, President Emmerson Mnangagwa said at the Africa Investment Forum (AIF) in Abidjan, Ivory Coast, on Thursday.
Zimbabwe has vast resources, so it is the government’s mission “to explain ourselves” and inform investors that Zimbabwe is a safe destination for investment, Mnangagwa said.
“There’s a gap between perception and reality, but through our introduction of reforms — political and macroeconomic — that gap has narrowed,” he said. “There is a vast difference between what investors hear when they are told about Zimbabwe and what they find.”
Decades of human and property rights violations, stolen elections and rampant corruption under Robert Mugabe’s despotic rule resulted in Western sanctions and global alienation. The economy collapsed, bringing shortages of basic goods and services and a mass exodus of its working population to countries around the globe.
While Mugabe’s removal in a coup created hope that sanctions would be lifted, Western countries have been reluctant to do so as human rights violations continue under Mnangagwa. SA is among several African countries calling for the lifting of sanctions.
Speaking at a high-level discussion at the AIF — an African investment marketplace — Mnangagwa was at pains to encourage investment to his country. His government acknowledges that it is not enough to have resources, but that it should also create an attractive investment environment with guarantees of investors’ safety and security.
“And to do that, we created Zida [the Zimbabwe Investment & Development Agency], a one-stop centre for investment.
“We are a stable country in terms of politics and governance, and private sector investors could find opportunities for investment in mining, agriculture, infrastructure and manufacturing,” he said.
After rising to about 7% in 2021, real GDP growth in Zimbabwe is expected to decline to about 3.5% in 2022, reflecting a slowdown in agricultural and energy outputs amid erratic rains and rising macroeconomic instability. This was amid a recovery in mining and tourism, an IMF team led by Dhaneshwar Ghura, said during its past virtual visit to Zimbabwe.
Zimbabwe’s annual inflation moderated by 4.6 percentage points to 280% in September. The consumer price index increased 3.5% on a monthly basis in September, signalling a notable drop in price pressures and marking the first single-digit month-to-month growth since March 2022.
Data shows that food and transport inflation eased in subindices, while utility prices inflated further.
Ghura said even though uncertainty remains high, Zimbabwe’s economic outlook would depend on the evolution of external shocks, the country’s policy stance and the implementation of inclusive, growth-friendly policies.
African Development Bank president Akinwumi Adesina said the AfDB is looking for various opportunities in Zimbabwe and has identified several.
Zimbabwe has presented three projects to the AIF worth a total of $217m, he said. These include the development of border infrastructure between Zimbabwe and Mozambique, valued at $90m, and a steel project expected to produce about 300,000 tonnes of steel.
“We are also financing the Kariba Dam rehabilitation, Alaska-Karoi transmission line and energy sector reform support projects,” he said.
“I think Zimbabwe is not as risky as you think. You have a president that is strongly committed to reforms ... committed to political reforms, macroeconomic reforms. I know that there are challenges, but I know we can sweep this to the other side and get Zimbabwe back and strong as it once was,” Adesina said.
The AfDB will send its chief risk officer to Zimbabwe to re-examine its risk weighting to help clear the way for greater private sector investment, he said.
“I would like to commend Zida. When I came to see you [Mnangagwa], you told me you have 228 licences that have been issued by Zida, 102 of those are renewals and 126 are new licences, which means people see the investments in Zimbabwe as profitable and they have confidence in the country,” he said.
The AIF was founded by institutions such as the AfDB, the Development Bank of Southern Africa and the African Export-Import Bank. It is used to select, support and facilitate high-impact deals in the continent’s critical sectors through facilitating financing for project preparation and advisory services directly or through its network of advisers.
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