Online Reporter
Zimpapers Business Hub
THE Confederation of Zimbabwe Industries (CZI), a local business member organisation, says a balanced strategy that rewards both new investments and rehabilitation of old ones would guarantee inclusive growth in industry.
Investors are reportedly investing more into greenfield projects (new developments built from scratch) than in brownfields.
An analysis of the Zimbabwe Investment and Development Agency (ZIDA) investment approvals shows that over 65 percent of new industrial investments registered between 2018 and 2024 were greenfield projects, primarily in food processing, chemicals and construction materials.
In an article titled “Old Factories, New Fears Part One”, CZI says abandoning “brownfields” wastes existing national assets, including buildings and infrastructure (such as the railway lines entering old industrial zones), as well as skilled workers.
This erodes the country’s industrial foundation and leaves communities stranded.
It is believed this also creates concentrated joblessness, decays urban areas into hazardous zones and severs critical local supply chains.
“A balanced strategy, rewarding both new investments and responsible rehabilitation, will define whether Zimbabwe’s industrial sunrise becomes inclusive or uneven,” reads the article in part.
“To channel patient capital towards the vital task of brownfield revitalisation, a targeted strategy is needed to level the playing field.
“The goal is not to punish greenfield investment, but to make brownfield revitalisation a financially plausible and attractive alternative, ensuring the nation’s industrial past is not an abandoned liability but a reusable foundation for the future.”
CZI, however, cautions that old industrial assets can be deceptively cheap, with what begins as a “cheap acquisition” often ending as a costly rehabilitation through replacing obsolete machinery, rebuilding electrical systems or retrofitting effluent plants to meet Environmental Management Agency (EMA) and Standards Association of Zimbabwe (SAZ) standards.
In many instances, refurbishment costs reach 60-80 percent of new-build expenses yet yield lower efficiency and higher maintenance risks.
CZI also says many older plants were designed for volume production under import-substitution models, not modern lean or modular production.
Retooling them for today’s lean, automated and sustainable manufacturing models could, therefore, be prohibitively complex.
“New plants, however, are ‘green by design,’” added CZI.
“They integrate solar energy, water recycling and digital monitoring from inception, key requirements for ESG (environmental, social and governance)-aligned financing from institutions like IFC (International Finance Corporation) and Afreximbank (African Export-Import Bank).”
The IFC’s 2022 Zimbabwe Green Manufacturing Diagnostics found that firms adopting modern, energy-efficient equipment reduce production costs by up to 25 percent through savings on electricity, water and maintenance.
Older industrial zones like Msasa, Workington and Belmont, the business lobby group said, suffer from unreliable power and outdated logistics.
Meanwhile, new industrial parks, such as Sunway City Industrial Park, providing stable utilities, road access and proximity to corridors, give greenfields a structural advantage.
Further, CZI believes the spatial logic of industry is shifting, with investors no longer seeing value in clustering within decaying inner-city industrial zones.
Instead, they are relocating towards logistics corridors and renewable-energy nodes, near Harare-Mutare, Beitbridge and Shurugwi.
It is also believed the law, through the ZIDA Act and the Special Economic Zones framework, for example, largely favours greenfield investors with incentives, from 10-year tax holidays and duty-free capital imports to fast-track permitting and flexible profit repatriation. “Reviving a distressed company is a complex art, requiring debt restructuring, operational overhaul and cultural renewal,” said CZI.
“Only three registered corporate rescue practitioners have successfully concluded major industrial turnarounds since the introduction of the Insolvency Act in 2018, highlighting a serious shortage of restructuring expertise.
“However, this expertise is rendered useless without the right kind of funding. Zimbabwe’s financial landscape is dominated by institutions that are cautious, collateral-driven and focused on the short term.”
Industry continues to call for the establishment of a targeted fund meant to help revitalise old factories.
