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Lovemore Chikova Development Dialogue

When President Mnangagwa appointed the board and chief executive officer of the newly formed Zimbabwe Investment and Development Agency (ZIDA), he went a long way in kick-starting operationalisation of the long- awaited entity.

The chief executive officer of United Refineries, Mr Busisa Moyo, was appointed board chair of ZIDA, while top private sector investment executive Mr Douglas Tawanda Munatsi came in as the chief executive officer.

Other members of the board are Dr Tobias Takavarasha, Mr Kenneth Richard Rupert Schofield, Dr Sylvia Janet Utete-Masango, Mrs Sithandile Ngwenya, Mrs Tariro Ndebele, Engineer Michael James Tumbare, Mrs Nancy Samuriwo and Mr Moosa Hanif Allana.

For any organisation of the nature of ZIDA, it is always the case that much is expected from the board and the chief executive officer to execute a plan that will quickly turn around fortunes in the investment sector.

That Zimbabwe needs a sharp increase in both domestic and foreign direct investment is very clear, and the coming in of ZIDA brings hope to many that the country will finally be able to realise its ambitions in this sector.

This places a huge responsibility on Mr Moyo and Mr Munatsi, together with their team, as the nation has been eargerly awaiting a fully functional ZIDA.

It is now up to Mr Moyo and Mr Munatsi to select a team to work with, which is capable of turning around the country’s fortunes to become a top destination for investors.

What gives people hope that the investment sector will never be the same with the establishment of ZIDA is the broad mandate that is given to the organisation to oversee all investment issues.

ZIDA is a one-stop shop investment centre that will handle all issues in that sector, especially by creating an environment that is conducive to the attraction of investors.

This is a mammoth task for the newly appointed ZIDA officials, but they can triumph through setting their priorities right in terms of reaching out to potential investment.

The first point of call should be for the ZIDA officials to be able to explain to potential investors a clear vision for Zimbabwe as articulated by President Mnangagwa.

In fact, President Mnangagwa is on record as quoting former Chinese president Deng Xiaoping’s famous saying that, it does not matter whether the cat is black or white  as long as it catches mice.

This is powerful in terms of the direction which President Mnangagwa is focusing when it comes to foreign direct investment, as it exudes the attitude of how open the country has become to investors.

It does not matter where the investor comes from, as long as they bring capital to Zimbabwe for the beenfit of the country.

The essence of the President using Deng’s quote is to re-emphasise his pronouncement that Zimbabwe is open for business.

What Mr Moyo and Mr Munatsi should quickly come to terms with is that investors are interested in destinations where they are able to reap their profits and do whatever they wish with them without too many  restrictions.

In being alert to the above fact, it is equally important that the ZIDA officials balance between benefits accruing to the country and the profits that end up in the pockets of the investors.

Investors are attracted by destinations that offer fair deals which are equally protected by laws and regulations.

In this case, the ZIDA Act is not ambiguous when it comes to creating that conducive environment capable of attracting foreign investors, guaranteeing them that their investments will be safe.

One of the points of brainstorming by the new ZIDA officials should be around the fact that Zimbabwe has almost everything that is needed to attract investors, yet the flow of foreign direct investment (FDI) has been negligible over the years.

Investors are known to be attracted by provisions such as abundant raw materials and availability of an educated labour force — Zimbabwe has both, and much more.

It is clear that Zimbabwe has been lacking proper incentives enough to attract foreign direct investment, and this fact is reflected in the ZIDA Act, which gives the ZIDA officials a mandate to offer  packages that can attract the investors.

Another focus for ZIDA is to help with the ease of doing business through demystifying processes that enable one to set up a business in the country.

There were simply too many offices which prospective investors had to visit to get all the licences required to start a business in Zimbabwe.

This should be covered by the One-Stop Investment Services Centre which will be set up under ZIDA, with the responsibility of housing all entities that used to separately deal with investors.

Organisations such as the Immigration Department, Zimbabwe Revenue Authority (ZIMRA), Environmental Management Agency (EMA), Reserve Bank of Zimbabwe (RBZ), Companies Registration Offices, National Social Security Authority (NSSA), Zimbabwe Energy Regulatory Authority (ZERA) and Zimbabwe Tourism Authority (ZTA) will have desks under this centre.

The ease of doing business to be created by the One-Stop Shop Investment Centre will go a long way in easing the fears of investors, but this should be coupled with clear guarantees and incentives, according to the ZIDA Act.

Everyone should be alert to the fact that FDI has proved in other countries that it can be a source for private capital inflows and advanced technologies that have the potential to change the economic status of a country.

Apart from technology, FDI is a source of skills transfer and innovative capacity for Zimbabwe.

FDI, if handled well, can also lead to employment creation and an increase in exports.

This means that issues that confront the country when it comes to the ease of doing business need to be addressed in a practical way to ensure conditions that attract investors are in place.

In this case, it is well and good to celebrate the appointment of the board chair and the chief executive officer of ZIDA, but what is paramount is for the two officials to hit the ground running.

The work that confronts them needs a lot of focus and no distractions from other quarters to avoid investors dealing with too many entities.

ZIDA should be given the leeway to retain the sole responsibility of dealing with investors of whatever nature, as provided for by the law.

From a start, it should be made clear that there is no room for corruption because the vice has the potential to turn away prospective investors.

Zimbabwe has not been doing well when it comes to the attraction of FDI, but ZIDA is expected to change all that. According to the World Investment Report, FDI was stagnant at US$400 million between 2010 and 2013, but in 2018, the inflows rose to US$745 million, up from US$349 million in 2017.

President Mnangagwa was spot on in appointing Mr Moyo and Mr Munatsi to lead ZIDA because they have the appropriate mindset, experience and qualifications for the job.

Mr Moyo is the chief executive of  the blue chip United Refineries and is a seasoned business executive, industrialist and entrepreneur.

He holds a Bachelor of Accounting Science degree from the university of South Africa and Global Executive MBA from IESE business school (Spain).

Mr Munatsi has a finance and investment background, holding a Master of Business Administration (Finance) degree from the American University in Washington DC and is an associate of the Bankers’ Association of Zimbabwe.

He is co-founder and partner of BDF Capital Partners Limited.

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