The implementation rate for investment approvals in Zimbabwe stood at 30% in the past four years due to lengthy licencing procedures by a multiplicity of agencies beyond the Zimbabwe Investment Authority (ZIA), the agency has said.
BY VICTORIA MTOMBA
“The average implementation rate we have is 30%. We note that projects suffer delays due to lengthy licencing procedures by a multiplicity of agencies beyond ZIA approvals, feasibility studies also lead to projects being implemented in phases and some projects are also capital intensive with gradual implementation as they roll out the investment,” ZIA chief executive officer Richard Mbaiwa told Standardbusiness.
Mbaiwa said the authority carried out an investment review survey for the period 2010-2013.
Zimbabwe is luring investors to help rebuild the economy and has simplified investment procedures by setting the one-stop-shop (OSS) to remove bureaucratic bottlenecks in starting and operating a business.
ZIA has licensed 678 projects with a total value of US$8,9 billion from January 2011 to date. The approval time frames differ from project to project depending on complexity.
Mbaiwa said the OSS has achieved some success in that the investment licensing time frame at ZIA has been reduced to five working days from 49 adding that there was need to continuously improve the coordination of the processes of the various agencies dealing with investors.
“A number of these agencies are part of the e-government flagship project which aims to electronically link the various agencies through a central business database and thus create a virtual one-stop-shop. This process is on-going,” he said.
Mbaiwa said the processing time for the transactions was the same but depended on project complexities.
“Complaints reaching our offices have cited mergers and acquisition approvals as well as environmental impact assessments as having taken the longest time, and also the highest cost framework being value based on the size of the project,” he said.
Despite the glitches, Mbaiwa was optimistic the country was going to witness increased levels of investment this year compared to previous years.
In the nine months to September ZIA approved more than US$714,9 million worth of projects exceeding the US$686 million for the whole of last year.
“This shows increased appetite for investing in the country. You may also be aware of increased interest in the country as shown by the mega deals in infrastructure and mining sectors recently signed with China and Russia,” Mbaiwa said.
“Our major draw cards in driving FDI include the infrastructure sector, that is, energy and power development, transport and water.”
Zimbabwe’s Foreign Direct Investment has been on an upward trend since 2009 when it took off at US$65 million and as of 2013 it stood at US$400 million. Despite the investment increasing since 2009 the country is still lagging behind its regional counterparts that are recording FDI of over US$1billion annually.