UNITED States companies on Thursday said no investment would come to Zimbabwe soon after the removal of sanctions despite interest to establish business ventures in the country.
The Corporate Council on Africa chief executive officer Stephen Hayes told local business leaders in the capital that American companies were not yet ready to invest in Zimbabwe. The group represents 180 corporations collectively making 85% of United States private sector investment in Africa.
“I also want to reinforce that there is a great deal of interest in Zimbabwe from the American business community. I have been fortunate to be employed by a board of directors who believe that CCA can be a business organisation that makes a difference in this world,” Hayes said.
“But, just because we would like to invest in Zimbabwe and to work in partnership with you, does not mean we are ready to do so….Even without targeted sanctions against individuals and entities that are undermining democratic institutions and processes in Zimbabwe, or that have materially assisted, sponsored, or provided financial support to these entities, I do not believe you would see significant US investment under the present conditions.” Â
Hayes remarks could be a blow to a cabinet decision pushing for the privatisation of loss making state enterprises and efforts by the inclusive government to boost declining foreign direct investment.
He however said US companies would “work together to support one another and to prepare for the day when, as partners in businesses” they would improve the “lives of our families and our respective nations”.
Hayes said US businesses were “ready to do business” with any country that respects the rule of law, arguing that more reforms were still needed in the inclusive government to attract investment.
The CCA boss also urged the transformation of Zimbabwe’s bad image regarding to property rights through better governance committed to the rule of law.
On the Indigenisation and Economic Empowerment Act, Hayes said the piece of legislation was a “formula” for divestment.
“Why would a company stay in Zimbabwe if they give up ownership, which also means that they have little say in how that company is to be operated, especially in an environment where the rule of law is inconsistent, at best,” he said. “It’s is a formula for losing one’s investment, not gaining profit that provides jobs and builds a nation.”
After endorsing South Africa’s Black Economic Empowerment in 2002, Hayes added that his organisation directs the South Africa International Business Linkages programme funded by the USAid.
Independent statistics indicate that foreign direct investment in Zimbabwe has dropped by an estimated 45% in the last 10 years.
BY BERNARD MPOFU