Investors call for policy consistency

HARARE Zimbabwe should ensure policy consistency if it is to be able to attract much needed foreign investment, a delegation of Japanese investors that visited the country last week said.

A 20-member delegation from the Japanese Chamber of Commerce and Industries in South Africa was in Zimbabwe to assess investment and business partnership opportunities. Head of delegation Hiroyuki Tarumi, a senior executive at Mitsubishi Corporation, said the Japanese investors have no problems with taking on board local shareholders in line with Zimbabwes indigenisation laws but said it was easier if there was clarity and consistency about the requirements of the economic empower regulations.

Tarumi said: “We have no problems with the percentage shareholding in the indigenization law but consistency in numbers is the key for us. If we are required to share with a local partner on 49% to 51% its okay. We will make our decision based on such an assumption, but when we start the joint venture, the requirement says 25%, that is where the problem is. In the course of business the number increases. Consistent of the policy and numbers is important for us to make a business decision.”

Tarumi said Zimbabwe has vast investment opportunities especially in mineral resources and infrastructure projects like electricity and water. Mitsubishi is interested in Zimbabwe’s platinum for vehicle components manufacturing. The Zimbabwean government has promised to correct policy inconsistencies. Red tape and policy inconsistency has often sent away investors in the past in an economy that is still suffering from the effects of the economic meltdown of the last 10 years.

The government is yet to set thresholds that foreign-owned firms in the various sectors of the economy must cede to locals. Initially President Robert Mugabe had wanted to compel all foreign-owned firms to sell 51 percent stake to local blacks by 2015. He was forced to backtrack under pressure from Prime Minister Morgan Tsvangirai who preferred setting different thresholds for different sectors of the economy.

Critics fear that President Robert Mugabe and Zanu (PF) who wield greater power in the unity government could be plotting another chaotic seizure of property in the style of farm seizures that destroyed Zimbabwes farming sector to leave the country facing acute food shortages.

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