adminZIMBABWE should create special economic zones (SEZ) for the country to attract meaningful foreign direct investment (FDI), an expert has said. The proposed SEZs come in different forms such as free trade zones, export processing zones and free zones targeted at attracting huge investments.
They are governed by different laws from those applicable to the rest of the economy making them investor friendly. China is one of the countries that have successfully created special economic zones for the benefit of its economy. Common Market for East and Southern Africa (Comesa) secretary-general Mr Sindiso Ngwenya said it was imperative that government promulgates laws allowing the establishment of SEZs.
“There has been no investment in value addition (in the Zimbabwean economy) and this is why I recommend that Zimbabwe puts in place legislation for special economic zones,” he said at a recent exporters’ conference. Already government officials have hinted at possibilities of creating special economic zones in Bulawayo and Victoria Falls as part of measures to attract elusive FDI. Zimbabwe’s Investment Act, which is due to be amended, does not allow for SEZs.
Mr Ngwenya said there were serious investors who had funds set aside for investing in special economic zones. The regional body, he said, had recently signed a deal with a Chinese firm, which had funds amounting to $36 billion specifically targeted for investment in SEZs in the Comesa region.
“It will require you (Zimbabwe government) to engage them to get that investment. They are ready to do that,” he said.
Mr Ngwenya cautioned that policy consistency was crucial in attracting and retaining foreign direct investment.
He said China, despite being a communist country still managed to attract trillions of dollars in western investment due to its stable investment policies.
“Capital is a coward, if you have a policy statement today and tomorrow it changes, it will run away,” he said.
Mr Ngwenya said government must also seriously look at attracting Diaspora investment through a variety of instruments such as Diaspora bonds.
Zimbabwe in the first eight months of the year approved investment projects worth $307 million up 13 percent from last year, according to official figures although some of the projects are never implemented. – New Ziana
Online Reporter