adminZIMBABWE has attracted high value investments this year as compared to previous years, a sign that investors with deep pockets are getting interested in the country’s economy, the Zimbabwe Investment Authority said.
In an interview, ZIA spokesman, Mr Nixon Kanyemba said in spite of a drop in the number of projects being approved by the investment authority compared to the prior year, the projects were of higher value which was a positive trend.
According to ZIA update for April, 45 projects were approved compared to 50 for the same period last year but the total value of the projects was more than $410 million as compared to $117 million last year.
The number of jobs created by the projects at 3 561 was also higher than last year’s 2 484.
“We used to get more investors who used to invest in smaller projects but currently the country is attracting huge investments which show the level of confidence investors are having in Zimbabwe and it is quite encouraging,” said Mr Kanyemba.
He said the investments were mainly in mining and manufacturing but they were beginning to see an interest in the services sector.
According to statistics from ZIA, there has been a significant drop in interest in the manufacturing sector with only 12 projects valued at about $33 million being approved as compared to 23 valued at $84 million last year in April while the mining sector continued to attract more investment with 19 projects valued at $118 million being approved as compared to last year’s 17 projects with a total value of $25 million.
The figures show that the services sector has realised a huge improvement especially looking at the value of the investments which totalled $251 million compared to $7 million last year in April.
Other approved projects during the April period were in the agriculture and construction sectors valued at $3 million and $4,4 million respectively.
However, Zimbabwe National Chamber of Commerce (ZNCC) chief economist Mr Kipson Gundani said Zimbabwe was still receiving little investment as compared to other countries in the region like Zambia, Mozambique and Angola.
He attributed this to the country’s high risk profile.
“The biggest factor when looking at our investments is to look at the total amount of investments compared to other countries. While we are getting $410 million, countries like Zambia are getting $1,2 billion and it is imperative for us to work towards addressing that,” said Mr Gundani.
Mr Gundani said investors were risk sensitive and sceptical on investing in Zimbabwe hence it was important to work towards addressing confidence-boosting factors.
He said there was an international perception that Zimbabwe did not respect upholding of property rights among other issues and these were the issues that needed to be dealt with to improve the value of investments.
“We are offering lucrative projects which are not being financed because investors think we are a risky destination. Our policy structures need to be improved and much work is needed in dealing with negative perceptions,” he said.
Government has agreed to offer tax incentives to foreign investors willing to invest in companies that require huge capital injection.
Finance and Economic Development deputy minister Dr Samuel Undenge said a team from different ministries was in Nyanga discussing the possible incentives that could be rolled out to investors.
He said efforts to provide tax incentives for investors were at an advanced stage with a strategic paper set to be presented before Cabinet soon.
Dr Undenge said giving incentives to investors was in line with plans to establish Special Economic Zones.
Online Reporter