EDITORIAL COMMENT: Bright future beckons for Zim as investors flock into the country Minister Patrick Chinamasa
Minister Chinamasa

Minister Chinamasa

ZIMBABWE sealed more than $5 billion worth of deals this week alone — a remarkable feat for the new dispensation whose reform policies are finding resonance throughout the world. This adds to the more than $11 billion deals and pledges the country has inked since the administration of President Mnangagwa took over in November last year.

What is striking about the deals sealed this week is the US$100 million loan facility extended to Zimbabwe by the United Kingdom and Standard Chartered Bank — a move which will see private companies benefit directly from a fund that will allow them to recapitalise, retool and shore up their working capital requirements.

This is very important in that the results of the capital inflow will immediately be felt as companies will be able to ramp up their productive capacities and hopefully export some of their products and improve foreign currency inflows into the country. From a bilateral perspective, the loan facility is a strong indicator by the UK government that it is willing to assist the people of Zimbabwe to get their economy back on its feet and normalise relations.

It is also a vote of confidence in the Government of Zimbabwe and a thumbs up for its reform mantra. It is trite to mention that this past week has been a momentous one for President Mnangagwa and his team as they signed a groundbreaking $5,2 billion deal with a South African company — Nkosikhona Holdings — that will see the country produce more than 8 million litres of liquid fuels a day from coal in Lisulu, Hwange.

The national consumption of fuel in Zimbabwe is about 5 million litres a day and it will take at least three-and-a-half years for the country to start benefiting from the project whose groundbreaking ceremony is scheduled for June 1 while actual mining operations will commence in September. The deal will see the beneficiation of coal for the production of liquid fuels like petrol, diesel, fertilizers and other chemicals.

Meanwhile, the world’s largest beverage company, Coca-Cola, has promised to invest $65 million in the country over the next three years. On Thursday, Coca-Cola’s East and Central Africa managing director Mr Ahmed Rady met President Mnangagwa and Vice President Constantino Chiwenga separately and tabled the company’s business plans and future investments.

There appears to be a stampede by international investors to plough their money into Zimbabwe and this is understandable. After years of stagnation largely because of the hostile environment and policies promulgated by the previous Government under former President Robert Mugabe, Zimbabwe has found renewed vigour and life under President Mnangagwa who is not only talking up the vast opportunities available in the country but is also demonstrating that the country is indeed open for business by sealing long term deals with investors from different parts of the world.

While some Zimbabweans might be in election mode and already girding their loins for a protracted poll campaign, it is business as usual for the President who is seized with ensuring that the economy rises from the ashes and Zimbabwe reclaims its dignity and rightful place in the community of nations. People don’t eat politics but bread and butter which derive directly from the economy and any right thinking politician would put it at the forefront of his priorities given the parlous state of the country’s economy at the moment.

President Mnangagwa must be doing something right to charm even former colonial master Britain, which for the first time in over two decades, has extended a direct  commercial loan to Zimbabwe. Captains of industry and monetary authorities have welcomed it, saying it will improve firms’ competitiveness.

Former Confederation of Zimbabwe Industries president, Mr Busisa Moyo, tweeted: “The loan for $100m by the UK to private sector is welcome & will reduce the cost of borrowing & allow retooling of factories for competitiveness. While the big mega deals have their place, many small “deals” of $20m, $30m, $50m that are concluded & executed quickly are good for Zim”.

Finance and Economic Development Minister Patrick Chinamasa on Thursday said the country was short of lines of credit to support the productive sectors and the loan facility, which had been arranged by the Commonwealth Development Corporation (CDC), an arm of the UK government, was the first significant line of credit to come “our way from Europe, and Western countries”.

“It is a very significant step that they have taken to support our economic recovery,” said Minister Chinamasa.

“That $100m facility will go towards supporting the productive sectors mostly to promote exports, which are necessary for us to grow the economy and the exports.” We welcome all these investors who are showing their confidence in Zimbabwe by ploughing their money into the economy.

We wish to assure them that Zimbabwe is the best place to invest given the bright prospects and abundant natural and human resources in the country. Now that the investment climate has improved, only the early birds will catch the fattest worms.

You Might Also Like

Comments