Zim needs US$14bn for infrastructure

to meet growing demand, the African Development Bank has said.
The figure was revealed by ADB president Mr Donald Kaberuka at the Zimbabwe Investment Conference co-hosted by Euromoney Conference and the Government of Zimbabwe in Harare yesterday.
More than 300 local and international delegates were in attendance. The conference closes today.
Mr Kaberuke said the estimate was based on a study conducted, at the request of the government, by the ADB on the country’s infrastructure.
President Mugabe who was scheduled to officially open the conference could not attend as he was attending to other pressing Government business.
Mr Kaberuka said the report discusses financing options and suggests a combination of parastatal, donor-funding and private sector interventions.
“We estimated that during the decade ahead, about US$14.2 billion (at 2009 constant prices) will be needed to rehabilitate existing infrastructure and create new capacity to meet growing demand,” he said.
The ADB president said the cost of doing business was high in Zimbabwe and rehabilitation of infrastructure was key to correcting the situation.
He said the poor state of infrastructure was because there had been little investment in transport, power, water and telecommunications in the last decade.
ADB established that of the 90 000 km of road network the proportion in good condition had declined from 73 percent to about 60 percent. By 2009 the amount of freight carried on Zimbabwe’s railways fell to 2,7 million tonnes, barely 15 percent of the original network capacity.
Zimbabwe’s service coverage for water and sanitation had also fallen in the eight years to 2000, as access to improved sanitation fell from 68 to 41 percent. The ADB report established that Zimbabwe now had less power generation capacity than three decades ago, as it has fallen by over 50 percent.
Furthermore, ADB said the country had fallen behind regional peers in terms of information communication technology service and broadband penetration.
Mr Kaberuka said while there was little fiscal space to close the infrastructure gap there was room for private sector participation in that regard.
But the ADB cited the issue of the country’s US$7 billion debt as a major stumbling block to Government’s efforts to attract foreign investment.
The regional bank said it had set aside limited resources to assist Zimbabwe while working with other lenders to address the country’s debt issue.
Zimbabwe owes ADB about US$500 million.
The regional bank said it had committed itself to assist in such areas as water and sanitation, agriculture and technical support and capacity, debt management and building capacity in the production of credible statistics.
Economic Planning and Investment Promotion Minister Tapiwa Mashakada said Zimbabwe welcomed the participation of foreign investors in the economy.
Where need be, Government was flexible in terms of application of the indigenisation regulations.
The minister cited the case of the concession for rehabilitation and expansion of Zimbabwe’s trunk roads and the investment in Ziscosteel by the Essar Group, which controls more than the stipulated 51 percent stake.
The conference sought to profile the abundant opportunities for investment in Zimbabwe, which has suffered from a blitz of negative publicity. This negative publicity and often-exaggerated reportage by international media resulted in wrong conceptions among foreign investors.