Govt pledges US$2m for ZIA

Government has pledged to make the money available by the end of the year.
Economic Planning and Investment Promotion Minister Tapiwa Mashakada said yesterday he would ensure the country’s supreme investment authority was well capitalised.
ZIA requires about US$2 million to fund various obligations, including securing state-of-the-art information communication technology and retaining key staff.

Although the Government was facing serious fiscal constraints, Mr Mashakada said resources would have to be secured by December as ZIA was vital for promoting foreign investment.
Foreign direct investment (FDI) is vital for economic growth and development, especially at a time Zimbabwe has little domestic resources to channel into employment-creating capital projects.
Minister Mashakada was speaking at ZIA’s performance review and strategic planning workshop in Harare. ZIA has started crafting a new five-year strategic plan after the end of the last one.

ZIA received US$132 000 under the 2011 National Budget and relies on revenue inflows levied on foreign investors seeking investment licences.
Minister Mashakada cited lack of funding as one factor constraining efforts to facilitate foreign direct investment into the country.
Under the Medium Term Plan, Zimbabwe has targeted to increase FDI as a percentage of gross domestic product from 4 percent to 25 percent a year.
“ZIA has struggled to achieve its objectives because of the environment which has not been conducive. It has been operating on a shoestring budget. To deliver, it needs quality resources, people and facilities,” he said.

At its inception, the inclusive Government required US$10 billion to fund its programmes, but the economy can only generate US$2 billion as it has not recovered from a decade of recession, making the case for FDI critical. Recapitalising ZIA will thus not only enable the authority to facilitate and promote investment, but would also enable it to monitor implementation of approved projects.
For instance, in the six months to June 2011, ZIA approved US$941 million worth of investments, but monitoring their implementation was difficult.

ZIA chief executive Mr Richard Mbaiwa said international “best practice” dictates that an investment promotion agency be Government funded.
“That programme (evaluation of projects implemented) has not happened because we do not have the (resource) capacity,” said Mr Mbaiwa.
Funding has also constrained efforts to install automated investor tracking systems to monitor implementation of approved projects and dictate challenges.
ZIA resulted from the merger of the Zimbabwe Investment Centre and the Export Processing Zones Authority to streamline investment approval.