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Harare Bureau
GOVERNMENT says the African Trade Insurance Agency has agreed to give Zimbabwe more time to mobilise funds to make the payments required for the country to start benefiting from the institution’s risk cover.Industry and Commerce Deputy Minister Mike Bimha yesterday said the ATI member states at this year’s Annual General Meeting had said they understood the problems that the country has been facing.
“They understood the economic challenges that we have been facing and also the fact that we have elections coming, so they gave us more time to source the funds,” he said.
ATI is a multilateral financial institution providing export credit insurance, political risk insurance, investment insurance and other financial products to help reduce the business risks and costs of doing business in Africa.
It also facilitates exports, foreign direct investment into and trade flows within the continent.
Deputy Minister Bimha said Zimbabwe joined the pan-African body last year but the country could only enjoy the benefits after making a contribution of $25 million in capital.
He said his ministry had engaged the private sector to try and mobilise funds.
“We have been talking to the private sector players, who mainly deal with imports and exports and we hope that the Government that comes in after the elections will also take this initiative seriously and release funds,” he added.
He said the country had been attending the ATI meeting of shareholders as an observer for three years before being admitted into the organisation last year.
He noted that joining ATI would provide cover against political risks adding that some investors had indicated that they could not risk their investments as the country was not a member of ATI.
“Most insurers do not cover political risk and being a member of ATI would mean Zimbabwe would be covered for political risk,” he said.
Zimbabwe has been on a mission to lure investments and help rebuild the economy.
According to the Medium Term Plan, Government wants investment to contribute 20 percent of the Gross Domestic Product (GDP) in 2015 from the current 4 percent.
Recent statistics from the United Nations Conference on Trade and Development show that Zimbabwe’s Foreign Direct Investment increased from $387 million in 2011 to $400 million last year.
Since 2009, Zimbabwe has been registering growth in FDI following the adoption of the multi-currency regime which stabilised the economy.
ATI currently conducts business in nine African countries—Burundi, Democratic Republic of Congo, Madagascar, Kenya, Malawi, Rwanda, Tanzania, Uganda and Zambia.
The institution was launched in 2001 with the financial and technical support of the World Bank and the backing of seven African countries.
In less than a decade, it has supported over $2,5 billion worth of trade and investments across the continent.
Online Reporter