US$10bn investment lost under Mugabe
ZIMBABWE missed out on investments worth at least US$10 billion during Mr Robert Mugabe’s Presidency due to bureaucracy and corruption.
Information obtained by The Sunday Mail from various sources suggests top politicians and civil servants were usually to be blame.
Lack of solid policy direction to back investment solicitation also hindered investment.
A case in point, officials said, involved Africa’s richest man, Mr Aliko Dangote, who in 2015 was taken aback when a figure close to Mr Mugabe demanded that her son be included in the Nigerian magnate’s investment deals.
Mr Dangote put plans to invest in Zimbabwe’s cover cement manufacturing, coal mining and power generation sectors on the back burner and only revived his interests upon President Emmerson Mnangagwa’s ascendancy.
Further, a minister in Mr Mugabe’s Cabinet allegedly demanded a kickback from an investor who wanted to revamp Zimbabwe’s major towns and cities. The investor left, never to return. Cypriot mining giant Karo Resources endured cumbersome bureaucracy as it sought to invest in platinum mining.
The US$4,2 billion deal was only consummated last Thursday, eight years after expression of interest.
It will directly create 15 000 jobs and could rapidly grow the country’s GDP.
Karo Resources head Mr Loucas Pouroulis said, “A lot of people, including certain ministers, were trying to stop the project. It has taken hard work to reach signing of the deal. Basically, we have been in Zimbabwe for eight years, trying to get this project on track.
“We had challenges, especially with the previous Minister of Mines, Mr Walter Chidhakwa. It was difficult. There was a lot of bureaucracy, red tape. Some people didn’t want us to move forward.
“One cannot dwell on the past. What is important is that we are here now and that we are moving forward.
‘‘We have signed and are happy about the future.”
Zimbabwe Investment Authority CEO Mr Richard Mubaiwa estimates that investments worth at least US$10 billion could have been scuppered by the old order.
“It is difficult to put a figure to how much we could have lost in potential investment. But it is definite that we lost billions of dollars. Roughly, I can put the figure at upwards of around US$10 billion because of failure on our part to do the right things.
“Investor sentiment has now been revitalised in a big way. This shows that the ‘Zimbabwe is Open for Business’ campaign is not just talk. These pronouncements are being made at the highest level and have given confidence to investors.
“The Investor Guidelines, which the President brought into force; policy statements dealing with investor security and guarantees on protecting investment have all made investors feel secure investing in Zimbabwe.”
Minister of State for Presidential Affairs and Monitoring Government Programmes Simbarashe Mumbengegwi said Zimbabwe’s new administration had cut red tape.
Overseeing signing of the Zimbabwe-Karo Resources deal, President Mnangagwa said, “At one time, (Karo) raised the money, but were stepping away because we could not move. The Zimbabwean way was something I cannot describe.
“But now we are saying Zimbabwe is open for business and whoever stands in the way of making business in this country will fall.
“On our part, wherever Zimbabwe has an obligation, we must meet our obligation. And if we fail, come to me; my door is open and say ‘your ministers are dragging their feet’ and I will make sure I cut the feet.”
President Mnangagwa has pledged to guarantee rights of investors and to re-engage the international community to attract investment.
Hardly three weeks after his assuming office, Afreximbank committed a US$1,5 billion stabilisation package that provides guarantees to investors.
Respected US consultant Frontier Strategy Group recently reported that Afrocentric multinational firms regard Zimbabwe among the top four Southern African countries with the best business opportunities.