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Nelson Gahadza
Business Reporter
Nedbank Group says Zimbabwe remains an attractive destination for foreign direct investment and that its local unit will continue to support key sectors of the economy to drive economic growth
Dr Terence Sibiya, Nedbank Group managing executive of Nedbank Africa Regions, during a virtual presentation of the 2024 financial results, said the group would continue to focus on the nature of funding demands in Zimbabwe to support economic growth.
“We still think Zimbabwe is open for business and will continue to support those sectors that drive Zimbabwe’s economic growth.
“We look at our strengths, which include infrastructure finance, project finance, energy finance, and lending into sectors that drive economic growth.
“A key focus for us going forward will also be to support small to medium enterprises (SMEs) and support mid-tier corporates,” he said.
He said the group still believed Zimbabwe had massive opportunities in key sectors that drive economic growth. As such, he said Nedbank Zimbabwe would continue to support such areas, backed by its parent firm.
Dr Sibiya said the use of the US dollar as one of the key functional currencies enabled Nedbank Zimbabwe to continue supporting the productive sectors of the economy.
“The demand from the productive sectors, agriculture, mining, infrastructure and energy and from our clients continued. Therefore, that helped settle the volatility that we experienced to that point.
“We did not see a dip in the lending from our side and continued to keep our doors open for clients throughout the tobacco season, merchants, as well as some of the farmers and some of the key drivers of gross domestic product (GDP) growth,” said Dr Sibiya.
Nedbank, which has other operations in the region outside South Africa, said each country posed peculiar challenges that vary from time to time.
At some point, he said, Mozambique was flying, with the economic growth rate averaging 6,5 percent annually, but had slowed down due to some challenges of political instability, which also slowed imports at the ports of Maputo and Beira.
Mozambique still presents a massive opportunity for the Nedbank Group, Dr Sibiya said, although the market is currently facing some challenges.
“Likewise, in Zimbabwe, there have been issues of currency volatility, sometimes shortages of (foreign) currency, and again, we then switched to a lot of the digital platforms so we could continue servicing our clients in that market.
“And others, again, present different opportunities at different times, so I suppose it is for Nedbank in Zimbabwe, Namibia, and Lesotho to respond according to market needs at all times,” he said.
Commenting on liquidity issues in Zimbabwe, Dr Sibiya said this was a market phenomenon globally, which the group would work on together with the Reserve Bank of Zimbabwe (RBZ).
“From a Nedbank point of view, we are doing our bit in terms of how we support our clients when they need to either liquidate some of their ZAR (South African Rand) or when they need support from a forex perspective, because we are able then to talk to the Reserve Bank in order to support our clients, and we are able to continue providing liquidity,” he said.
“A good relationship with the RBZ means that we have been able to continue supporting our clients and also play our role in supporting the liquidity in the markets through the central bank.”
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