Kudzanai Gerede Business Correspondent
This year’s 37th Independence anniversary theme: ‘Embracing Ease of Doing Business for Socio-Economic Development’ has been hailed as a bold statement which speaks to Government commitment to creating an enabling business environment that guarantees viability and sustainability of prospective investment into the country.
Zimbabwe is in need of massive capital injection in various sectors of the economy to spearhead its economic blueprint, ZIMASSET but grotesque legislative and institutional tailbacks continue to hinder the smooth flow of business operations and dampen investor appetite.
The cost and means of doing business in the country is widely perceived to be relatively burdensome compared to other destinations in the sub-Saharan region leading to a dip in investment flow figures into the country during the past years.
This has seen the country’s overall ratings tumble on various global think tanks surveys in terms of competitiveness; business efficiency and investment protection among other key economic indicators.
This year’s independence theme of embracing the ease of doing business could not have come at a much more relevant time and event, said competitiveness expert Mr Pepukai Chivore.
“Government has demonstrated its commitment to the ease of doing business in the country by running with the theme this year. Government needs to build investor confidence by spear heading this campaign and propagating it as much as possible,” he said.
“High levels of informality of businesses operating in the economy come down to cumbersome and very costly procedures one has to undergo just to be registered as an entity. We need to ensure all facet of our business components are effective, efficient and cost minimum. Most of the old policies governing colonial and archaic business models cannot attract serious investors in such a highly competitive global economy,” he added.
Government has however managed to strike significant achievement such as embracing e-registration to ensure efficiency in company registration, setting up of credit registry to bring sanity into the financial services sector that is critical in financing local projects and restricting unfettered access of import products to ensure local investors gain market space locally.
“The Willowton cooking oil plant in Mutare is a classic example of how prudent investor friendly policies can bear fruit for the economy. Statutory Instrument 64 did not only protect local manufacturers. We have to look at it in reverse. It actually made those manufacturers flooding the local market with their products think of setting up plants here rather than manufacture outside,” said Chivore.
In 2016, Zimbabwe’s foreign direct investment (FDI) figures plummeted to US$ 254.7 million from US$ 399.2 million in 2015 when neighbouring Zambia and Mozambique on average realized around US$ 2 billion and US$ 4 billion annually respectively in FDI flows.
Since the attainment of Independence in 1980, the country has made little progress in terms of revising most of stringent requirements to start businesses such as time and procedures taken in registration of companies among other huddles.
Government, however, in 2016 promulgated the Ease of Doing Business Reforms after having realized the country was facing multi-faceted business operating bottlenecks which not only kept investment at bay, but also stifled local businesses growth.