South Africa business seeks Zimbabwe guarantees on investment

HARARE – South African business leaders on Monday called for guarantees to protect new investment in Zimbabwe, after noting efforts by Harare's new unity government to attract business to help its battered economy.

A weekend government reconstruction summit produced a 100-day action plan that seeks to end Zimbabwe’s isolation and aims at re-engagement with Western governments seen crucial in funding an economic recovery plan.

South African mining magnate Patrice Motsepe led a 22-member delegation from Business Unity South Africa (BUSA), which held talks with President Robert Mugabe and Finance Minister Tendai Biti in Harare.

"This was a very good meeting, it was a very frank discussion and they want to make Zimbabwe attractive.The critical thing is that the rules of investment should remain in place," Motsepe told reporters after the meeting.

Western donors have withheld aid to Zimbabwe over policy differences with Mugabe, including the seizure of white-owned farms for distribution to landless blacks.

Last year’s enactment of an empowerment law seeking to transfer control of foreign firms to locals has also unnerved investors.

"The concern is that there should be no shifting of goalposts a few years down the line. What the President and the finance minister have reconfirmed is the new policy formulated by the inclusive government to create an environment which builds trust," said Motsepe.

"I’m very confident and optimistic, Mr President, that two years from now, there will be huge investment in this country."  

Mugabe said the visit by the South African delegation showed confidence in the unity government between his ZANU-PF party and the MDC of Prime Minister Morgan Tsvangirai.

Biti told journalists he had assured the group that the new government was committed to protecting investments.

"We made it clear that our economy is ready for investment," he said.

The BUSA delegation, which included executives from the agriculture, mining, construction, financial and pharmaceutical sectors, was scheduled to meet Zimbabwe’s business leaders on Monday.

Zimbabwe’s unity government has crafted a short-term emergency programme to help revive the economy, battered by ten years of contraction and hyperinflation, while unemployment is over 90 percent.

The government says the programme will give greater emphasis to political reforms demanded by Western donors before pouring in aid.