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Zim falls in investment ratings

Staff Writer

ZIMBABWE continues to perform badly in international investment ratings. The crisis-ridden nation has been ranked among the bottom five countries in a latest report by Cato

Institute, a Washington-based non-partisan research foundation that evaluates the degree of economic freedom in individual countries.

The report, Economic Freedom of the World: 2003 Annual Report, found Zimbabwe to have some of the most stringent laws with regards to investment choice.

The report considered 123 nations.

Zimbabwe is in the same category as the war-torn Democratic Republic of the Congo, Guinea-Bissau, Myanmar and Algeria.

The report takes into account economic freedom, which includes personal wealth, voluntary exchange, freedom to compete and the protection of persons and property.

The report also shows that most economically unfree states are still in sub-Saharan Africa. Botswana, which has for a long time had a significantly higher level of economic success than other nations in the region, today enjoys a per capita gross domestic product of US$3,950 compared to a figure of US$564 in sub-Saharan Africa.

In the report Botswana has the 26th highest level of economic freedom, tied to eight other nations including Japan and Norway.

Hong Kong, Singapore and the United States are the top three countries.

Investment analysts say Zimba-bwe’s land grab policy, fiscal indiscipline, price controls and lack of debt management could have contributed to the low ratings in the report.

Zimbabwe is embroiled in an economic and political crisis and has during the last three years been bottom-placed in most economic and humanitarian reports.

The Economist Intelligence Unit (EIU) gave Zimbabwe an overall risk rating of “E” on political risk, economic policy risk and liquidity risk.

The EIU expressed concern on the ongoing political crisis within the country and the potential for the eruption of politically-motivated unrest and deficit.

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