Source: Minister slams archaic Companies Act – DailyNews Live
STAFF WRITER 30 March 2018
HARARE – Justice, Parliamentary and Legal Affairs minister Ziyambi
Ziyambi, pictured, says government is determined to improve the ease of
doing business as part of measures to resuscitate the country’s wobbling
economy.
Ziyambi, who was delivering a keynote address at a stakeholder workshop to
review the Draft Companies and Other Business Entities Amendment Bill in
Harare yesterday, singled out Zimbabwe’s regulatory framework as one of
the major impediments to economic growth.
“Clearly, the country’s regulatory framework has not been conducive and
the results and dire ramifications are there for everyone to see,” said
Ziyambi.
The minister cited Zimbabwe’s position on the Ease of Doing Business Index
as proof of the country`s lack of competitiveness.
“Ranked 159 out of 190 economies on the Ease of Doing Business Index
according to the latest World Bank annual ratings, the new political
dispensation has an unenviable task of convincing the world that the
country is indeed open for business,” he said.
Ziyambi is convinced that small and medium enterprises will thrive if the
Companies and Other Business Entities Amendment Bill is passed as law.
“It goes without saying that when systems, processes, rules and
regulations are business-friendly, setting up of businesses is made easier
not just for big companies but also smaller ones that have less capital at
their disposal.
“It is pertinent to note that for larger corporations and businesses that
have access to the means and personnel or third part agencies to process
all the paperwork, payments, registrations etc. this usually takes place
quickly and without much of a hassle.
“However, with small and medium enterprises, more red tape can often
result in obstacles that ultimately prevent them from moving ahead with
their business in a timely manner or discourage individuals from pursuing
businesses in their local economies.
“In addition to the above, transaction costs form a major part of setting
up shop for small and medium sized businesses,” said the Justice minister.
He attributed corruption and the failure to attract foreign direct
investment to a large extend on the limitations imposed by the current
Companies Act which was passed in 1951.
“In Zimbabwe the opaque and restrictive regulatory framework for setting
up and even operating a business, discouraged foreign direct investments
, limited opportunities to economic opportunities and stimulated
corruption,” said Ziyambi.
In addition to Ziyambi, yesterday’s stakeholder workshop to review the
Draft Companies and Other Business Entities Amendment Bill featured deputy
Attorney-General responsible for Legislative Drafting Nelson Dias,
director of legislative drafting Mupariwa Mukaratirwa, Bankers Association
of Zimbabwe’s Nqobile Munzara as well as presentations from the Institute
of Chartered Secretaries and Administrators in Zimbabwe and the Institute
of Directors.
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