via Colonial laws hitting Zim’s foreign investment – DailyNews Live 9 October 2014 by Kudzai Chawafambira
HARARE – Zimbabwe’s ease and cost of doing business is being weighed down by colonial laws inherited by the ruling government, the World Bank (WB) has said.
“I share with you the colonial history of Zimbabwe, that you were a British colony,” WB’s country manager Camille Nuamah told participants at the Doing Business Reform strategy meeting last Friday.
“Many of the things that private sector has to deal with in terms of bureaucracy have been inherited from a long time ago. Whereas, for example the British have moved ahead, you are still living off from systems that need remedial action.”
She added that it was “a whole mindset not thinking backwards and what you were before, but thinking outside the box and what you can be.
“This needs to be a continuous process (improving the ease of doing business) .I do think you have to be realistic at the beginning and should start in a way that you can continually implement reforms.”
Currently, it takes nine procedures, 90 days and cost 141,2 percent of income per capita, while no paid-in capital is required, to start a business in Zimbabwe.
This comes at a time when the country was this year ranked 170 out of 189 economies on the World Bank’s Doing Business indicators, a negligible two places up from 172 recorded in 2013 and 170 in 2012.
Despite the adoption of an economic blueprint, ZimAsset, targeted at unlocking Zimbabwe’s economic potential, the country fared poorly on most indicators, ranking 150 on ease of starting a business, 170 on dealing with construction permits, 157 on getting electricity, 167 on trading across borders, 118 on enforcing contracts, and 156 on resolving insolvency.
The southern African country’s low ranking indicated that the cost, time and procedures for doing business in Zimbabwe is high for locals and so deters even foreign investors.
Industry minister Mike Bimha noted that Zimbabwe’s poor ranking communicated a negative message and gave a negative perception from potential and foreign investors.
“Such a low ranking on the ease of doing business index means the regulatory environment is less conducive to the starting and operating of a local firm,” Bimha said.
“In the region, in 2013, foreign direct investment into the country amounted to only $400 million, against $1,7 billion in Zambia and about $5,9 billion for Mozambique, signalling strong competition on the global market for investment.”
Against this background, Bimha said it was important that the country needed to quickly align investment initiatives by working towards improving the ease of doing business in Zimbabwe in order to attract more FDI.
COMMENTS
Oh boy … it just can’t be the bain dead ZANU government …..
is it because of the Colonial laws that “it takes nine procedures, 90 days and cost 141,2 percent of income per capita “to start a business. I might be wrong but I don’t believe that, so the WB believes if it took one day then there would be a flow of companies setting up, how would that improve liquidity,property rights,corruption?
After 34 years I doubt one could call them colonial laws – I would call them useless zanupf laws after all that’s how long these have been in place with zanupf in control to change them at any time they so wished. Stop[ blaming the past for zanupf failures.
It’s all the fault of the British! It’s been 34 years and still Mugabe and Co. still cannot accept responsibility for the mess they have made. Why hasn’t Mugabe changed the laws in 34 years? It’s because those laws feed the patronage system that keeps him in power. He doesn’t care about the people or businesses trying to succeed in Zimbabwe, he only cares about his own personal power. Nothing will change until the government changes it’s attitude towards the people and the economy, and that is still a very far way off.
100% true. The Colonial laws were made to make it difficult for the majority to start their businesses so that the few whites would remain the only masters of businesses. Now the cruel Zanu-pf did not change the laws coz they wanted their “Bigwig Chefs Only” to replace the whites as rich business bosses. All in all this is the root cause of our poverty. They dont want “to share” and they will not look back until they are removed at any cost.
Zimbabwe did very well until 1999………..19 years later…….changes to the laws could have been initiated but all, only wen there was threat of political usurpation of power…did the Zanu pf government realise that the Laws were colonial.
What a lot of b…t.After thirty four years we still blame the colonial laws.Same old african answer.I am not the one!!
I really don’t believe that.
I had quite a big factory in the Rhodesian days and cannot remember being swamped by bureaucracy or that it was hard to start.
However, I have had a number of businesses since 1980 and bureaucracy has been a nightmare, as well as the total failure of civil servants to understand how business works.
So that statement about “colonial laws” is utter nonsense, just a sop to make the gangstas feel better – and give them someone to blame. I am not ze one!!! It is those dreaded whites.
Basically the government has taken pre 1980 laws and made them more bureaucratic to open them up for corruption. If you want you pieve of paper passed on pay or it sticks! Its part of African life that is throughout Africa, one of ther reasons Africa is so behind the rest of the world. Corrupt politicians make for a corrupt population.
it’s the Breeteeeeeshh! We are not the ones!!!!