Chanakira urges govt to put words into action

Business
The Zimbabwe Investment Authority (ZIA) has challenged government to amend at least eight pieces of legislation in order to attract foreign direct investment.

The Zimbabwe Investment Authority (ZIA) has challenged government to amend at least eight pieces of legislation in order to attract foreign direct investment.

BY XOLISANI NCUBE

Presenting oral evidence before the parliamentary portfolio committee on Youth, Indigenisation and Economic Empowerment last week, ZIA board chairperson, Nigel Chanakira told lawmakers that amendment of the laws would ensure ease of doing business.

Key among the impediments noted by ZIA as scaring away FDI was the “misconception and negative publicity on the indigenisation laws” and a plethora of laws that investors have to comply with before being granted investment certificates.

“In April this year, the president [Robert Mugabe] had to issue a statement giving guidelines to the indigenisation laws but still, investors are asking, that is only a statement, where is the law to back it up?” Chanakira said.

Among the laws that need to be amended, according to Chanakira, are the Companies and Deeds Registry Act, Shop Licencing Act, the Regional Town and Country Planning Act, Small Claims Act and the Reserve Bank of Zimbabwe Act among others.

“These laws have to be in line with the presidential statement so that we can have uniform language when it comes to the ease of doing business,” he said.

Chanakira said ZIA had been tasked to handle foreign firms that sought to invest in the country and help them comply with the indigenisation policy, which demanded that 51% shareholding of every investment above $500 000 be owned by local people.

Zimbabwe has progressively failed to attract meaningful foreign direct investment since 2009.

Last year FDI inflows into Zimbabwe were down to $421 million from $545 million in 2014.

This is against huge investment gains being recorded by the country’s neighbours such as Mozambique and Zambia which received $3,7 billion and $1,6 billion respectively in 2015. The inflows into Zimbabwe were a drop in the ocean, considering that the Southern Africa region had combined FDI inflows of $17,9 billion.

So far, according to Chanakira, ZIA had reduced the number of days a foreigner needed to have an investment certificate issued from 90 days to 15 days as a way of attracting investors.

According to the ministry of Macro-economic Planning and Investment Promotion, FDI inflows are projected to surpass $1 billion this year on the back of deals signed with Chinese, Russian and Indian investors.

“Major deals were signed with Chinese, Russian and Indian investors and the economy is poised to receive triple FDI inflows in 2016 as a sign of increased investor confidence,” the ministry said in a 2015 fourth quarter macro-economic bulletin.