GOVERNMENT, through the Ministry of Industry and Commerce is carrying out a study aimed at identifying and eliminating duplication of functions across regulators and on the overall licensing regime as part of efforts to improve the Ease of Doing Business in the country. The process of reforming the business environment in Zimbabwe aims at reducing and simplifying procedures, automation of processes and review of processes and legislative framework.The over-arching process includes reforming the investment promotion agency, Zimbabwe Investment Authority, and creating a One-Stop-Shop for business.
The reform process of ZIA is underway under the Ministry of Macro-Economic Planning and Investment Promotion and this includes amendment of ZIA Act to, among other things, legislate for the One-Stop-Shop, to give it legal effect.
ZIA chief executive Richard Mbaiwa said the study is being carried out with technical and financial support from USAID SERA.
“It is true that there is some duplication of functions across regulators and this generally cuts across the sectors. The extent of duplication needs to be documented to enable specific remedial action to be taken,” said Mr Mbaiwa.
“The thrust now is for evidence-based reforms whereby the extent of the problem is documented and specific targeted steps are taken to improve that area.”
Mr Mbaiwa said there are moves to harmonise the regulatory process and this will be supported by the evidence gathered from the study on licensing. The whole issue of ease of Doing Business Reforms aims to address such anomalies.
ZIA is involved in the Doing Business reform programmes and has representation in the various Technical Working Groups working on thematic areas of Doing Business.
“We are actively involved in the Doing Business reform process, and look forward to conclusion of the study referred to earlier on the overall licensing regime in the country. This is still work in progress. Most of the Acts for example legislating some of the charges that push up operational costs of doing business are yet to be finalised in terms of the revisions,” he said.
Licensing is often put in place to regulate activities within a sector, to ensure public safety, public health, national security and other Government imperatives.
“The processes, however, may lead to a delay in the commencement of business for a company. The thrust of reform is to, therefore, ensure that regulation takes place but in a manner that facilitates advancement of business, for example, streamlining of procedures or eliminating unnecessary procedures makes it easier to do business in any particular jurisdiction,” said Mr Mbaiwa.
Already, a study on the Cost Drivers for business in Zimbabwe, has been carried out by the Ministry of Industry and Commerce which identified some key cost drivers in the business environment in the country.
A study carried out by the Zimbabwe Economic Policy Analysis and Research Unit in response to a request by the Ministry of Industry and Commerce, to evaluate cost drivers affecting the competitiveness of Zimbabwe’s businesses identified labour, power, water, finance, transportation costs, tariffs and trade taxes, taxation and information technology as some of the major drivers.
Other factors also identified in the study as negatively impacting on costs and competitiveness are lack of scale-under performance of agriculture; failure by the Government to pay for goods and services on time, among others.
As Government continues to monitor progress in the reform process, the second phase of the 100-Day Rapid Results Initiative for Doing Business reforms was launched last month and runs up to May for the Technical Working Groups which include starting a business/protecting minority investors; dealing with construction permits/registering property; enforcing contracts/resolving insolvency; paying taxes/trading across borders; and getting credit.