ZIMBABWE’s Honourary Consul to Israel Ronny Levi Musan says foreign direct investment would remain a pipedream for the country unless government implements critical political and economic reforms around property rights and other issues that boost investor confidence.
Though President Emmerson Mnangagwa’s administration is riding on the mantra ”Zimbabwe is open for business” to court investors who were rattled by his predecessor’s hostile investment thrust, the country is still battling to mobilise investors, amid a continuation of the old dispensation’s unpopular business policies.
Treasury forecasts FDI inflows will drop from US$259 million last year to US$150 million in 2020, owing to a combination of factors that investment analysts attribute to Zimbabwe’s perception as a negative business destination. Mnangagwa abruptly re-introduced the worthless Zimbabwe dollar in 2018, temporarily banned trading on the local bourse and unleashed a fresh onslaught on productive commercial farms.
Musan, who was appointed by Mnangagwa in August, told the Zimbabwe Independent this week that after decades of ruinous investment policies, foreign investors were afraid of channeling capital into a country in the throes of a debilitating economic crisis.
Musan highlighted that empty rhetoric, and hollow sloganeering on the part of Zimbabwe would not lure investment, but tangible and friendly economic reforms.
He said: ”Every person who invests money wants to know that his money is safe and secured and he will see profits from his investment. Zimbabwe’s ongoing economic situation makes it difficult to obtain international credit. Investors are afraid to invest even though they want to. I personally know some big investors willing to invest capital in Zimbabwe but they ask me: Ronny … what guarantee we get for our money? Who assures us that they will not throw us out after we have invested? ‘These are legitimate questions that need to be considered in particular when we want to bring significant growth to Zimbabwe and not empty slogans”.
With the economy expected to shrink by 4,1% this year owing to Covid-19 induced pressures, Musan said, significant growth could be spurred by cultivating an investor friendly climate.
”Investor confidence helps the economy of the country, because when there are no investors there is no growth. We must have full co-operation with the decision makers in this area in Zimbabwe because investors do not like to fall between chairs,” the diplomat told said.
Endowed with a vast mineral treasure trove, a skilled labour force and a strategic geopolitical position in the region, Musan highlighted that Zimbabwe could easily navigate from its economic challenges, and assert itself as a regional economic powerhouse.
”To me, Zimbabwe is a piece of paradise with huge human and economic potential. Zimbabwe can bloom. As I said in previous answers, we need to find the formula that will give investors’ guarantee for their money, this is the main issue now that we are examining. I’m sure solutions can be found because Zimbabwe has a lot to offer, we just have to sit down with the decision makers and make decisions,” he said.