‘We’re serious about protecting investment’
ON February 7 2020, President Mnangagwa signed the Zimbabwe Investment and Development Agency (ZIDA) Bill into law, heralding the dawn of a new era in the country’s quest to attract both local and international investors. Before the promulgation of the ZIDA Act, Dr Washington Mbizvo (WM) has been the interim chairperson of the One-Stop Investment
Services Centre (OSISC) — a precursor to ZIDA — under the auspices of the Office of the President and Cabinet (OPC).
Our Chief Reporter KUDA BWITITI (KB) spoke to Dr Mbizvo to get an understanding of how the new development might possibly transform the country’s investment climate. *****
KB: What was the significance of promulgating the ZIDA Act and what can we expect going forward?
WM: The ZIDA Act was promulgated on the 7th of February in 2020. What this means in real terms is that the functions of ZIDA have been explained by way of legislative machinery, which is now defined as the Zimbabwe Investment and Development Agency Act.
We are in the process of integrating all the various organisations that processed investments.
KB: What is going to happen to other departments such as the Zimbabwe Investment Authority (ZIA) that used to handle investments?
WM: We are integrating the processes and systems. In real terms, the Acts of ZIA, Zimbabwe Special Economic Zones Authority (ZIMSEZA) and the Joint Venture Authority (JVA) have now been dissolved by virtue of merging ZIDA. These institutions will cease to operate as their functions have now been subsumed into ZIDA.
KB: What is the fate of workers of these institutions that have since been subsumed in ZIDA, are they going to lose their jobs?
WM: This week (last week) we started the process of winding up these three operations, beginning with ZIA. As we wind up, the Auditor-General will be auditing these organisations. In reality, ZIA offices located along Rotten Row are now closed to investors. All investors are directed to come over to ZIDA.
The Auditor-General is conducting a comprehensive audit and communication to that effect was sent by the Chief Secretary to the President and Cabinet (Dr Misheck Sibanda); and thereafter, there will be a profile of all assets so that it becomes a comprehensive audit, in terms of movable and non-movable assets, human resources, security items and so forth.
In terms of the new Act, the human capital element, Government will be guided by Section 49 of the Act, which says that nobody will continue to hold posts that they occupy. In terms of sub-section 6 under Section 49, ZIDA will have to assess the staff in terms of their qualification, experience and competencies with a view of engaging some of them, provided they meet the criteria.
Some will be transferred for deployment, some
will be moved to the Public Service Commission for further deployment.
This is upon agreement by both parties.The Act is very clear. KB: Is there a timeframe for this transition? WM: The transition has to be done speedily, although the Act says the period of transition should not be over two years. We are hoping that now that we have started, some of the processes can be completed within weeks.
KB: What measures are there to ensure that the processes do not affect investors?
WM: We must not interfere with investors who are coming. This whole process is being driven by the OPC in a very smooth and transparent manner.
For our investors, we are designing a website under ZIDA which will inform our Zimbabwean investors globally so that information is disseminated to our embassies.
The OPC (Office of the President and Cabinet) is also working on the coming in of the CEO (chief executive officer) of ZIDA. We are delighted to announce that very soon the official launch of ZIDA will be done by His Excellency, the President (Emmerson Mnangagwa). KB: Under OSICS what work has been done so far to lure investors?
WM: Zimbabweans will be delighted to know that a lot has happened. Some factories that had closed have been opened and there have also been new investment projects.
For example, we have one investor who has invested in a company called Merken (Private) Limited, which is now manufacturing oral hygiene products in the Graniteside area of Harare.
It is manufacturing 10 000 tubes of toothpaste per day, using some factories that had closed down.
For the first time, we have toothpaste being manufactured in Zimbabwe. The company started at the end of 2019 and has employed a lot of people, including recent graduates from universities and polytechnics. The examples are too many to mention.
But the import of all of it is that we really mean it when we say ZIDA is the game-changer because it is unlocking economic opportunities in line with Vision 2030.
KB: You have spoken about international investment, how about domestic investment: charity begins at home. Has there been increased interest from local
investors?
WM: Yes, very much so, and I have a number of examples. Schweppes Zimbabwe recently opened a big citrus plant in Beitbridge. We managed to negotiate 40 hectares of land for them towards production. They are also setting up a factory for producing cosmetic products using orange peels.
I can go on and on because there are a number of projects. The plan is to have our website and investor guide, and this is going to be launched by the President together with the National Investment Policy.
KB: Since the interim ZIDA committee was put
in place, how many investment approvals have you recorded?
WM: Since we started operating on August 1 2018, we have been able to get through 73 big projects and about 15 have been operationalised. What we have also done is to set up an after-care service so that we can follow up with these projects to ensure that there is compliance and investors are not frustrated, and we attend to their grievances. KB: What are some of the most common grievances among the investors?
WM: Within our system we have a representative from the Reserve Bank of Zimbabwe because some of the grievances are to do with the repatriation of foreign currency and dividends in US dollars. Within the ZIDA Act, we have incorporated security of investments as a major component.
We have also incorporated in the Act guarantees against expropriation, fair and equitable treatment to investors, non-discrimination among foreign investors and transparency in the laws, regulations and procedures, as well as other further processes to protect investors. KB: Under ZIDA, how many days is it now taking to open a business?
WM: Our staff has been trained since 2018. We were assisted by Deloitte and the World Bank. Thereafter, we created a template which was approved by the OPC, then we created a floor of experts from various ministries. So in reality, OSICS is composed of experts from Government departments who have been well-trained and well-groomed.
They represent EMA (Environmental Management Authority); Zimbabwe Revenue Authority (ZIMRA); Department of Immigration; RBZ; NSSA (National Social Security Authority); Energy Ministry; Mines Ministry; Local Government; Tourism; Labour; Lands and Agriculture, as well as specialists for joint ventures seconded from Ministry of Finance.
OSISC is responsible for facilitating prompt processing of investments for the relevant desks.
It used to take 90 days because investors were
trotting from one ministry to another, but it has now been reduced to a couple of days. Our aim under ZIDA is to reduce the process to a maximum of four days.
KB: Some investors have said they are put off by too many laws that are inimical to investment. How has this been addressed?
WM: Before ZIDA’s creation, there was an overlap of legal instruments and business regulating procedures. There was a tendency of a silo mentality and uncoordinated processing and screening of investment, which caused unnecessary delays — opening up avenues of corrupt activities.
There was no integration and coordination of the entities that handled investments. There were high fees charged for licences, but ZIDA has created a single point of contact and processing of investment and issuance of investment certificates.
Life has been made much easier in line with the mantra “Zimbabwe is Open for Business”.
KB: What are some of the policy reforms you have instituted?
WM: Zimbabwe is a signatory to various international conventions and organisations for promotion of investments. We also subscribe to Bilateral Investment Protection Agreements (BIPPAs). We are also under the United Nations Commission on International Trade Law.
The regional office of the African Regional Intellectual Property Organisation (ARIPO) is in Zimbabwe.
All this shows that we are serious about protecting investment and this has been amplified in the ZIDA Act.
In the development of ZIDA, we have taken lessons from other countries such as Rwanda, Botswana, Malaysia, Vietnam, South Korea and many others.
For investors who are coming in, we have identified a list of bankable projects both from the public sector and from the private sector. Examples are too many to mention.
KB: How will ZIDA be structured in view of Government’s plan to promote devolution?
WM: The structure of ZIDA will take into account provisions of Section 164 of the Constitution, which emphasises the use of resources in various districts and provinces, hence devolution.
These will be explained more broadly when His Excellency launches ZIDA. There will be a CEO who will provide leadership and will work with a chief operating officer.