Government has unveiled a post-election investment promotion blueprint anchored on protection of investment and property rights as the capital starved southern African nation pushes for re-engagement with the international community.
By Melody Chikono
Zimbabwe’s economy has been floundering since the last election with companies closing while inflation has been steadily rising.
The country is expected to go for elections by July this year.
Mnangagwa, who took over from Robert Mugabe in November last year, announced a raft of key measures that will guide investment policy and an elaborate plan of action in a bid to improve foreign direct investment that has remained flat around US$300 million in the last few years, lagging regional peers.
The president committed to the protection of all investments from expropriation and measures that will dispossess investors.
“The government commits to the protections of all investments from expropriation, or from measures taken that will have a similar effect, except for a public purpose and on a non-discriminatory basis, in accordance with national laws and principles of international law and subject to the prompt payment of adequate and effective compensation,” Mnangagwa said in the preamble to the new Investment Guidelines and Opportunities in Zimbabwe.
He said his government would adopt and implement consistent and transparent policies that render a competitive and preferred investment destination.
Reforms undertaken will seek to improve Zimbabwe as a competitive investment destination. Currently the country is lowly ranked on the World Bank Doing Business Report due to policy inconsistency and predatory investment laws.
Under the policy to be implemented in the next six months, Mnangagwa said there shall be non-discrimination between domestic and foreign investors as the government is committed to boosting sagging foreign direct investment
“The government commits to treating all foreign and domestic investors and investments as favourably as any other investor in like situation in relation to the establishment, operation, and protection of their investments, subject to such exceptions as are provided for in domestic laws, regulations and policies,” Mnangangwa said.
While the government will also commit to implementing effective mechanisms to manage investor grievances in order to improve market confidence.
The policy also seeks to ease the country’s immigration laws in order to attract both tourists and investors.
Government also committed to compensating white commercial farmers, who lost land during the chaotic land reform embarked on at the turn of the millennium.
“The new investment law shall ensure non-discrimination between domestic and foreign investors and shall accord to all foreign investors and their investments treatment no less favourable than that accorded in like situations to domestic investors in relation to the establishment, expansion, operation, and protection of their investments, with any specific exceptions being provided for in negative list to be annexed as a schedule to the law. The new investment law will enforce the protection of investors in accordance with the principles elaborated above,” Mnangagwa said.
Since taking over two months ago, Mnangagwa has pledged to implement a reform agenda that will build a comparative sector that will maximise linkages, deliver high quality jobs and support long-term growth.
Already government has undertaken to relax the controversial Indigenisation and Economic Law which was widely blamed for spooking foreign investment. The Indigenisation law alongside the country’s currency crisis that has resulted in investors facing challenges in repatriating profits offshore due to acute foreign currency shortages has also been viewed as anti-capital.