adminDumisani Nsingo Senior Business Reporter
THE delay in establishing Special Economic Zones (SEZs), which are set to afford potential investors with competitive incentives has led to countries lining up to invest in Zimbabwe being reluctant to do so, an official has said. Addressing the Parliamentary Portfolio Committees on Industry and Commerce, Finance, Economic Development and Foreign Affairs in Bulawayo on Friday, the Secretary in then Ministry of Economic Planning and Investment, now Macro-Economic Planning and Investment Promotion, Dr Desire Sibanda said there was a need to expedite the setting up of SEZs so as to grow the country’s economy.
SEZs are designated areas in countries that possess special economic regulations that are different from other areas in the same country.
Moreover, these regulations tend to contain measures that are conducive to foreign direct investment.
“A number of Chinese (companies) have told us straight away that they cannot invest like in other countries until the establishment of SEZs. We are therefore calling upon the Parliamentarians to expedite the process because we as the technocrats have done our part,” Dr Sibanda said.
He, however, said his ministry was working with the Ministry of Finance and Economic Development to produce a Draft Bill on the establishment of SEZs.
“The Bill has been sent to the Attorney General’s Office for finalisation by lawyers,” Dr Sibanda said.
He said the Bill was expected to be presented in Parliament soon paving way for the establishment of a SEZ Supervisory Board, which would define the conduct of SEZ Board members and operational modalities for the zones.
“The establishment of SEZs will afford investors with competitive incentives for them to invest in Zimbabwe. The Bill seeks to introduce SEZs in Zimbabwe. Zimbabwe is taking a leaf from countries such as Mozambique, South, Zambia, Ethiopia, China, among others who have realised considerable investment inflows as a result of the establishment of SEZs,” Dr Sibanda said.
Presenting the 10-Point Plan which will be used to maintain economic growth in particular the creation of jobs, in his recent State of the Nation Address, President Mugabe said the implementation of SEZs would provide the impetus for foreign direct investment into the country.
Industry and Commerce Minister Mike Bimha said the setting up of SEZs was still in the process.
“We are working on various initiatives. It is not taking long, when the right time comes we are going to implement them. We are looking forward to reviving all potential sectors. We have many possibilities looking into textile, leather, wheat-food processes industries and many others.”
Captains of industry have said there was a need to accelerate the setting up of SEZs so as to revive areas like Bulawayo.
Bulawayo was once the country and region’s industrial hub but has lost its status owing to the teeter economic situation that has been haunting the nation for close to two decades and the imposition of illegal sanctions by some Western countries.
The city has suffered the effects of de-industrialisation, which resulted in the closure of more than 100 companies and the laying off of about 20 000 employees.
Association for Business in Zimbabwe chief executive officer Dr Lucky Mlilo said in setting up SEZs there should be no restrictions for businesses entering a SEZ so that competition is intensified and everyone is free to take advantage of the privileges and to contribute to the growth of the economy.
“We hope that Government will quicken the process of establishing SEZs as this has been a topical issue for a long time. Bulawayo will hopefully benefit and arrest the process of industrial demise.
“International evidence indicates that SEZs are most successful when they are targeted towards particular industries and offer concrete solutions to the challenges faced by those industries,” Dr Mlilo said.
He said for SEZs to be economically successful, countries needed to be competitive and able to differentiate their SEZs from those in other countries.
“SEZs have been used to attract foreign investment, promote export manufacture, increase foreign exchange earnings and create employment.
“On the negative, there has also been rampant exploitation of workers and loss of Government revenue as a result of the creation of SEZs,” Dr Mlilo said.
Confederation of Zimbabwe Industries president Mr Busisa Moyo said the call by President Mugabe for the implementation of SEZs was a welcome development towards the revival of Bulawayo’s industry.
“This is welcome. Bulawayo is both keen and anxious to re-establish itself as an industrial hub for Cotton-to-Clothing value chain which includes; yarn spinners, weavers of fabric and garment manufacturers. The beef-to-leather value chain which includes abattoirs, tanneries, meat processors and packers, glue industries and the sustainable hardwood-to-furniture value chain and the iron ore-to-steel and chrome-plated goods value chain which includes; metal foundries and steel fabricating industries,” Mr Moyo said.
He said entrepreneurs, industrialists, management teams, financial advisors and investors should begin preparing and planning to take advantage of Bulawayo as a SEZ.
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