SA leads Zim investments

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SOUTH African investments remain at the top of approved projects and capital inflows into the country, figures from the Zimbabwe Investment Authority (ZIA)’s half year report show.
This also comes against the background of a long established fact and phenomenon that Pretoria remains Zimbabwe’s biggest trading partner, and there has been renewed debate for Harare to adopt the rand in a bid to stabilise the economy.
With investments from South Africa (SA) making up about 35 percent of all foreign direct investments (FDI) approved by ZIA between January and June this year, major companies such as Impala Platinum-owned Zimplats and others have always led the trend and league.
But Richard Mubaiwa, the ZIA chief executive, says it does not always mean that “approved projects would be converted into actual investments”.
“There is no way for us to know how much of it will be converted to actual investments because there is no precedent,” he told The Financial Gazette last week.
“It doesn’t mean that once an investment is approved, it is all converted into FDI in a particular year. Even if we are to approve… all applications, we do not expect them to fall in the same period,” Mubaiwa said.
Nonetheless, the latest statistics also show or represent a marked improvement from a figure of two percent in 2017 and Mauritian inquiries have equally improved ― from a single digit last year to 32 percent ― in the same period under review.
Chinese projects, meanwhile, have actually dipped from 19 percent last year to only 10 percent.
This comes as FDI into the southern Africa country has generally waned from $545 million in 2014 to $289 million in 2017 on the back of a deteriorating socio-political environment.
Following Robert Mugabe’s fall in November last year, there has been a slight change and uptick in interest and sentiment about the country.
“Under the new dispensation, there is gradual restoration of business confidence, with many investment inquiries from all continents,” Finance minister Mthuli Ncube said in his pre-budget statement.
“During the first half of 2018, ZIA received 165 applications worth $15,8 billion, over and above other investment inquiries with various line ministries and other individual companies,” he said.
“Government is pursuing the various investment inquiries with the objective of increasing the share of external investment from $1,8 billion anticipated in 2018 to over $2 billion in 2019,” Ncube said.