Zimbabwe is truly open for business

There is a breath of fresh air in Zimbabwe and investors are enjoying it. Now that the stink is no longer there, everyone wants to be friends with us. It’s like Zimbabwe has just returned from the wilderness of isolation with wisdom to share after deep soul searching.

This week alone, a Chinese business delegation from Anhui Province arrived to explore investment opportunities, while Karo Resources said it will begin activities on its $4,2 billion platinum investment project in Mhondoro-Ngezi.

Many other investors have lined up in the areas of energy, minerals and agriculture. In fact, the Zimbabwe Investment Authority had by June this year received 165 business applications worth more than $15,8 billion.

Now is the time to nurture comity.
It’s only when we work together for common good that we all succeed. Zimbabweans need to learn that they have no other dwelling. This country, is our only home.

Together we can shame our detractors. We can get Zimbabwe working again. But first, we all need to play our part.

Writing for the Financial Times, in an article published yesterday, President Mnangagwa summed it all up: “Governments do not only cut. They must also collect. As part of an effort to broaden the tax base, we recently introduced a 2 percent levy on electronic transfers, which make up around 96 percent of all financial transactions. Collecting revenue effectively and efficiently, combined with cuts and privatisations, will enable us to cut the Budget deficit.

“These measures are being complemented by an anti-corruption drive that will save Zimbabwe hundreds of millions of dollars. Investigations are underway and arrests are already being made, including of ministers and senior executives. The era of zero tolerance for corruption is here.”

The piece by the Head of State titled, “Zimbabwe has no choice, but to embark on painful reforms” is, in summary, the hard truth.

There is no gain without pain. The cuts on foreign travel and perks for officials need to be complimented by financial discipline across the board; even at household level. We cannot keep importing candy to satisfy the insatiable sweet tooth.

We need to keep our priorities in check. Do we need to be spending so much foreign currency on second-hand vehicle imports? Over $3 billion since dollarisation, to be precise. Between January 1, 2009 and March 31, 2017, a total of 323 600 vehicles were imported into Zimbabwe from various countries (mainly Japan).

The number of imported second-hand vehicles processed at Beitbridge Border Post last year rose 35 percent compared to 2016. Zimbabwe Revenue Authority (Zimra) said the country’s busiest port cleared 43 316 vehicles compared to 28 031 the previous year. Most of the imported vehicles were from Japan and South Africa.

Clearly cuts are needed in order to save on foreign currency. Although exports grew 36 percent to $3,8 billion in 2017 compared to $2,8 billion achieved in 2016, the trade deficit cannot be ignored. For example, month-on-month exports increased by 32 percent from $340 million in July to $449 million in August while imports increased by 3 percent from $560 million in July to US$577 million in August.

Painful reforms are the only way. Anyone who says anything else is out of touch with reality.
Although President Mnangagwa has mapped the path, public commitment is needed to reach the destination.

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