SA firms flock to Zimbabwe

PROSPECTIVE investors from South Africa are flocking to Zimbabwe as they top the list of countries with a high projected investment value of US$1,7 billion in the fourth quarter of 2023 cementing the country as one of Zimbabwe’s leading trading partners.

Projected Investment Value is the total amount committed by investors for a specific investment project as outlined in the application.

It represents the overall financial commitment made by various stakeholders to bring the project to fruition.

Zimbabwe Investment and Development Agency (Zida)’s 2023 fourth-quarter report shows that the proposed investment value amounted to US$4,4 billion, with mining proposals accounting for the bulk of the proposals.

In the period under review, 148 new licenses were received and 81 renewals.

Based on the report, by the value of investments, South Africa outperformed other countries with US$ 1,712bn and had seven new investment licences issued.

Of the seven new licences, the construction sector had the bulk of investment value of US$1,7 billion from one new investment licence.

The mining sector had three licences worth US$8,6 million, the services sector had two worth US$1,33 million and the tourism sector had one worth US$740 000.

Botswana was second with a projected investment worth US$1,411 billion from one new Investment licenses issued. The United Arab Emirates was third with projected investments worth US$703m, the Netherlands (US$234m) and China had $165m.

However, based on the number of investors, China led the pack with 81 with the mining sector having 37 new licences issued with projected value of US$83,23 million.

The manufacturing sector projected an investment value of US$37,40m from 20 new licences issued

“In 2023 the Agency managed to attract investors from 47 countries compared to 2022 when licences were issued to investors from 33 countries including Zimbabwe.

“ During both periods, investors from China continued to dominate, having the highest number of investors with mining being their most preferred sector followed by the manufacturing sector. However, China and Japan contributed the highest projected investment values in 2023,” reads part of the report.

On the local provincial front, Harare had 312 licences issued with a value of US$1,9 million while Matabeleland South had 10 licences worth US$16 million.

Zida said the regional distribution of investments underscores a pronounced concentration in Harare Province signifying a strategic allocation of capital towards the economic hub.

“Predominantly, the investment landscape in this province is characterised by a focus on the manufacturing and services sectors, indicating a deliberate effort to capitalise on the economic potential and business opportunities inherent in these industries.

“ This targeted deployment of investments aligns with a nuanced understanding of the economic landscape, where Harare Province emerges as a pivotal centre for fostering growth and development.

“The inclination towards the manufacturing sector underscores a commitment to industrial activities, capitalising on the region’s infrastructure, skilled workforce and logistical advantages.”

It added that the emphasis on the services sector indicates a recognition of the evolving dynamics of the contemporary economy, where service-oriented industries play a crucial role in driving innovation, enhancing efficiency and meeting the diverse needs of a burgeoning consumer base.

“As investors strategically position themselves in Harare Province, they are poised to leverage the synergies arising from a robust ecosystem that facilitates collaboration, innovation and sustained economic expansion.

“This strategic allocation not only reflects a keen understanding of the provincial economic landscape but also positions stakeholders to harness the full spectrum of opportunities inherent in both the manufacturing and services sectors.”

Zida is the Government’s investment promotion agency responsible for facilitating domestic and foreign investment in the country. It also offers incentives to investors and undertakes all that makes Zimbabwe a safe investment destination.

The agency co-ordinates investment projects by taking advantage of existing national synergies. It provides a one-stop shop investment centre that facilitates, licences and operationalise investments.

The establishment of Zida is one of the success stories of the New Dispensation’s economic reforms aimed at rejuvenating the productive sector and creating more jobs.

The grand plan is to realise an upper middle-income economy by 2030.