ZIMBABWEâ€™S International Investment Conference in Harare was apparently a major success in all respects bar one, but that one negative facet of the Conference negated all the positives achieved.
The conference was said to have attracted over 400 international investors, financiers, fund managers, and entrepreneurs, and with one exception most were initially filled with great conviction that Zimbabwe is now a very attractive investment environment. Much was demonstrated to evidence the magnitudeÂ of the investmentÂ potentialÂ that exists and, from the outset, the conferenceÂ participants wereÂ greatly motivatedÂ and primedÂ to embark uponÂ some of the immenseÂ investmentÂ that ZimbabweÂ desperatelyÂ needs if its economyÂ is to be transformedÂ from the cataclysmic lows to which it had sunk.
The conference attendees were convincinglyÂ appraised of the tremendous opportunitiesÂ that exist in mining, manufacturing, tourismÂ and other economic sectors,Â and whichÂ are likelyÂ to becomeÂ availableÂ in Public-Private Partnerships (PPPs) within diverseÂ parastatals. EmphasisÂ was justlyÂ placed upon the vastÂ wealth of Zimbabwean nationalÂ resources, upon the very considerableÂ industrial opportunities, upon theÂ unique magnificenceÂ of Zimbabweâ€™s diverse tourism attractions,Â and upon the economic transformation currently underway (including wide-rangingÂ deregulation, deflationÂ in substitutionÂ for hyperinflation, markedÂ reduction in scarcities, focus upon restoring parastatals operationalÂ efficacy and service to the economy, and much else).
However, the considerable mileage gained with the vigorously courted possible investors was markedly reversed when issues of land ownership were addressed. ConferenceÂ participants understandablyÂ voiced concerns that,Â on the one hand,Â invasions of farms continue virtuallyÂ unabated,Â with little or no attempt by the stateÂ to containÂ those invasions and that,Â on the other hand, evicted farmers have still not received compensation for the gargantuanÂ deprivations theyÂ have suffered.Â President Mugabe reiterated the endlessly voiced contention that the lands were â€œstolenâ€ by the British colonialists, lawfully belong to the Zimbabwean people, and that if there was any entitlement to compensation for the land, the obligation to that compensation lies with Britain.
This contention has prevailed ad nauseum, in total disregard for the facts that when the colonialists entered the country, much of the land was unoccupied and unutilised, and that such land as was in usage had, in the main, been expropriated from the San people, without compensation to them (clearly that which is sauce for the goose is not sauce for the gander!). That disregard was matchedÂ (andÂ continues to be matched) by contemptuouslyÂ founded unconcern that at the Lancaster House agreement of 1979, bringing aboutÂ ZimbabweanÂ Â Independence, Britain pledged agreed funding for land acquisition on a willing-buyer, willing-seller basis, and in the first four years of Independence, honoured its pledge. Similar disregard is demonstrated for the fact that the expropriated farms were acquired despite â€œcertificates of no interestâ€ issued by government.
Not only does government seek to impose compensation obligations upon others, in respect of the unjustly â€“â€“ and often violently â€“â€“ acquired lands, but in addition after almost a decade of acquisitions, it has yet to effect compensation for improvements, for vandalised and misappropriated moveables, and for loss of income. So blatantly has there been compensation default that government has not even honoured Bilateral Investment Promotion and Protection Agreements (BIPPAs). So government assiduously fails to comply with international norms of justice and equity, continuously ascribes blame, culpability upon others in general, and strives to shed itself of all responsibility, by contentious ascription of that responsibility to others.
Compounding this tragic mishandling of very necessary land reformÂ (whichÂ has devastatingly destroyedÂ agriculture, undermined a previouslyÂ virileÂ economy, and rendered millions poverty-stricken)Â is that the ongoing governmental stanceÂ on the land issues provides an insurmountableÂ deterrent to much-needed internationalÂ economic recoveryÂ support. That too is a deterrent to the investment which is essential to restoration of a virile economy, and much of the impressive mileage gained over the last six months by the Prime Minister, Deputy Prime Ministers, Ministers of Finance and of Economic Planning and Development is reversed by the dogmatic adherence of some to the ill-conceived, unjust, and appallingly implemented land policies.
With ongoing expropriationÂ of farms, in many instances initiated by invasions led by some in high office within government, the army or the police, often pursuedÂ with violenceÂ and with theft of livestock, plant, machinery and equipment, and other privately-ownedÂ assets, all studiously ignored by the alleged guardians of law and order,Â it is inevitable that potential investors be fearful whether their futureÂ investments will be secure, or whether they too will be vulnerable to expropriation, evenÂ if not in the agriculturalÂ sector.
These fears are reinforced by last yearâ€™s promulgation of the Indigenisation and Economic Empowerment Act, and the threatened amendments to the Mines and Minerals Act. Investors have an unavoidable reluctance to invest if they are faced with a possible expropriation of 51% of the investment equity, and that worsened by not even being accorded any credible assurance of recompense.
The contradictions at the conference were pronounced. The President said that â€œSuchÂ policies as the Indigenisation and Economic Empowerment Act shouldÂ not be viewedÂ as obstacles to investmentÂ promotion; they shouldÂ be welcomedÂ as promoting theÂ greater participationÂ of our peopleÂ in the economy,Â indeed the democratisation of our economicÂ activity that buildsÂ up to good business returnsÂ for the investorâ€. He also said that â€œour stable political environment is making us more conducive to promoting the rule of lawâ€. Some 4 000 displaced farmers, their families, and many of their employees, will credibly sneer at the suggestion that Zimbabwe upholds the sanctity of property rights. So too will beÂ the manyÂ who wereÂ victimisedÂ by violentÂ andÂ abusiveÂ farm invasions, confronted by force, subjected to physical injuries,Â and immense suffering, insofar as the contention that ruleÂ of lawÂ is promoted. And many will query the presidentâ€™s statements that government has â€œhonouredâ€ its obligations to pay compensation for improvements.
In contrast to the presidentâ€™s investmentâ€“discouraging stance at the conference, the Prime Minster sought to be more moderate, stating that whilst all agreed that land reform was needed, they differed on the approach. ThatÂ land reformÂ was (and is) necessaryÂ cannotÂ be convincinglyÂ justified,Â and hence theÂ land reformÂ must be irreversible , but that does not precludeÂ it being modified to be just, equitable, non-racialist, and effective.
At the conference,Â DeputyÂ Prime Minister Arthur Mutambara showed somewhatÂ greater realismÂ Â thanÂ his â€œUnity Governmentâ€Â colleagues,Â saying that government should stop blamingÂ the West for the socio- economicÂ decline,Â and should uphold the rule of law,Â respect property rights, and ensure aÂ moratorium on farm invasionsÂ and disruptionsÂ affecting white farmers.
Until government â€œgets realâ€ on land issues, unreservedly respects property rights, complies with the precepts of rule of law, and constructively â€“â€“ not destructively â€“â€“ pursues economic empowerment and indigenisation, prospects of major investment inflows and other substantial international support are tremendously minimised. Zimbabwe could have one of the greatest economies in Africa, and could almost wholly eradicate poverty, if it â€œgets realâ€, but in the meanwhile it continues to shoot itself in the foot.
BY ERIC BLOCH