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ON Tuesday, Zimbabweans woke up to the news that some international investors had committed to the country through the acquisition of ABC Holdings trading as BancABC – one of the biggest deals post-dollarisation in 2009.
The $210 million investment into ABCH by former Barclays boss Bob Diamond and Africa’s youngest billionaire Ashish Thakkar, is a huge confidence booster not only for the banking sector but for the country as a whole.
It’s a major coup for the country given its demonisation by western powers that it is not conducive for investors.
So much has been said about the country, but some bold and forward looking investors have looked beyond the political rhetoric. For investors it should be about business not politics.
In his words, Thakkar said the transaction positioned Atlas Mara – the investment vehicle – to collaborate in a synergistic manner with other partners in sub-Saharan African countries and to expand the combined group’s portfolio of banking products and value added services.
He said given the combination of BancABC’s regional expertise, ADC’s initial platform and Atlas Mara’s global experience, they are confident of building a true African financial services institution that addresses the needs of our people across the continent and creates a meaningful and lasting positive impact.
So this is not only about Zimbabwe, but the whole continent. We have said it before and we will continue to do so, the country provides a platform to expand into the whole of sub-Saharan Africa hence any serious investor like Diamond and Thakkar would want to be investing in the country.
The bold message from these international investors is clearly that Zimbabwe is open and ready to do business with the outside world. What the people of Zimbabwe want and have been misunderstood by the outside world is their quest to have their destiny in their own hands.
The deal also proves critics of the country’s empowerment programme, which seeks to ensure that locals have majority stakes in key sectors of the economy, wrong in that regardless of the law, other investors have still found it worthwhile to invest in the country.
Fellow international investors should therefore not be clouded by the short-term challenges the country could be going through, for surely the giant of Southern Africa that has been lying dormant is reawakening.
What makes this deal even more critical is that it goes to the core of the country’s economic heartbeat – which is funding. Once the country’s banking sector has gained confidence, unlocking lines of credit to up the tempo of economic revival will be much easier.
Atlas Mara has already pledged to invest $100 million in BancABC every year to help boost the company’s capital adequacy ratios which in itself will make the bank solid.
Just like during the land reform exercise in 2000, other investors walked away while those that had long-term plans with the country engaged government. More than a decade later, the country is reaping the benefits of the exercise as evidenced by the number of small-scale farmers growing tobacco among other commercial crops.
According to the Tobacco Industry and Marketing Board, the number of growers has since risen to 100,000.
Apart from the latest deal, Zimbabwe is endowed with potential investment opportunities in different sectors that foreign investors can tap into.
For instance, prospective investors can tap into sectors such as mining given that the country is home to a quarter of the world’s diamond reserves, platinum, lithium and gold to mention but a few. Other sectors where investors can find value for money include tourism, manufacturing and of course agriculture.
The ABCH deal has no doubt confounded the country’s critics. It’s time for foreign investment before it’s too late.
Online Reporter