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Nyemudzai Kakore Herald Correspondent
CORRUPTION is at the centre of price distortions and needs to be dealt with if the country is to realise effective economic development, Vice President Emmerson Mnangagwa has said.

Speaking at an Institute of Chartered Secretaries and Administrators in Zimbabwe (ICSA) annual dinner on Friday, VP Mnangagwa challenged the business sector to adhere to strict corporate governance principles.

He said the problem of kickbacks and bribe-taking was rampant in the private and public sectors and should be urgently dealt with.

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“The prevalence of bribe-taking, offering kickbacks and favouritism must be eliminated in all our business deals both in Government and the private sector as it is costing us a lot in terms of overpriced goods and services,” said VP Mnangagwa.

“If we, as a nation, do not address issues of country risk both from a socio-political aspect at a macro level, investors as we know them are risk averse and if we are to attract responsible capital then we should reduce the risk associated with the way we do business.”

VP Mnangagwa said it was important to create a conducive environment to attract Foreign Direct Investment.

Despite the economic sanctions imposed on Zimbabwe by the West, VP Mnangagwa said, the economy could have performed better if good corporate governance enforcement mechanisms were in place.

“As we aspire to resuscitate our economy, good corporate governance is a prerequisite which should be embraced as an essential element of doing business,” he said. “It is not beneficial for individual companies, but is essential for enhancing the stability and competitiveness of our economy.

“This is so because good corporate governance serves to attract and safeguard investment for the realisation of national objectives which in our case are currently identified through the Zim-Asset objectives.”

VP Mnangagwa said poor corporate governance cost the country huge sums of money through the salarygate scandal by senior managers in state enterprises and parastatals. The scandal was unearthed last year.

He said several financial institutions were collapsing, while ordinary people were failing to get their salaries on time and in some cases losing their jobs.

VP Mnangagwa said he was optimistic of a change in behaviour following the launch of the National Code on Corporate Governance. The president of ICSA, Mr Lovemore Kadenge said the National Code is likely to effect behaviour change in parastatals as the organisation was recently awarded the green light to have an oversight on parastatal performance in terms of adherence to good corporate governance.