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(Bippa) with Botswana, set to unlock US$76 million in lines of credit for Zimbabwe.
Economic Planning and Investment Promotion Minister Tapiwa Mashakada said the Bippa with Botswana would unlock more opportunities than before.
“Cabinet has approved the signing of the Bilateral Investment Promotion and Protection Agreement between the Republic of Zimbabwe and the Republic of Botswana,” he said, briefing journalists in Harare yesterday.
Bippa is an agreement establishing the terms and conditions for private investment by nationals and companies from the countries involved.
The agreement also provides procedures for resolution of any disputes.
The signing is expected to take place in Harare within the next two weeks.
Minister Mashakada said when the two countries have endorsed the bilateral investment agreement, he would take it to Parliament for approval.
The agreement will result in Botswana’s financial institutions releasing funds to the Zimbabwean manufacturing sector. The investment accord would only cover investments in the two countries made after the signing of the agreement, as does the one with South Africa, signed in 2009.
Expectations are that the latest development will send the right signal and unlock funding facilities that South Africa pledged at the beginning of 2009.
But Minister Mashakada said the Bippas Zimbabwe had entered into with other countries were not an end in themselves, but only facilitators.
The minister said there was need to improve the investment climate to enhance Zimbabwe’s competitiveness, as it was poorly ranked in the world.
To that end, he said, Government had established the One-Stop Shop Investment Centre at the Zimbabwe Investment Authority to streamline the approval process and improve the country’s world competitiveness rankings.
The Government has also held investment conferences and will soon embark on international roadshows to lure investors.
Minister Mashakada said Government was in the process of clarifying investors’ misconceptions around the indigenisation programme.
He said the indigenisation law had been misconstrued, abused and vulgarised, yet it was only meant to empower local people.
Nonetheless, he said there was huge interest by foreign investors in Zimbabwe as evidenced by delegations that visited Zimbabwe from such countries as Germany, South Korea, Japan, South Africa and China.
Confederation of Zimbabwe Industries president Mr Joseph Kanyekanye welcomed the Cabinet decision. He said it showed the country was making progress in respect of unclocking lines of credit.
“This probably reflects that we have been able to live up to what is expected of us. If this one comes from Botswana, then a lot is expected to come from South Africa,” he said.
The Bippa made secure the funding expected from Botswana banks.
Lack of funding and the liquidity challenges in Zimbabwe have seen banks charging as much as 30 percent interest on predominantly short-term loans.
Zimbabwe requires about US$8 billion to rebuild the economy to its 1997 levels, having shrunk by more than half over the past decade.