Published: 2016 August 03 06:08:23 (5674 Views)

Zimbabwe has been urged to reform its business laws by the African Export and Import Bank (Afrexim Bank) so as to attract increased foreign direct investment (FDI).

Despite having vast natural resources, the country has not attracted significant FDI in the past few years when compared to its regional counterparts, an Afrexim Bank official, Gift Simwaka, said.

“We need to fix our investment climate as a country. Zimbabwe has not been getting enough FDI, hovering around $400 million, when others are getting up to $2 billion,” said Simwaka while contributing during a Confederation of Zimbabwe Industries congress in Bulawayo last week.

“We need to work on areas where we have a competitive edge. We need to clear our arrears to reduce country risk”.

Country risk is a subjective yet critical factor in attracting FDI for a country as it affects investor confidence and informs the level of interest rates charged by financial institutions.

Reserve Bank of Zimbabwe Governor Dr John Mangudya, who attended the meeting, concurred that clearance of external and internal debt was a priority so as to attract fresh lines of credit for industry.

He said the country was targeting settling its external debts at least before October while working on a viable proposal on economic recovery.

At the moment, Zimbabwe’s FDIs average $400 million per year, a figure that falls below regional economies that are attracting external investments at a value of above $2 billion per annum.




- Chronicle

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