Zimbabwe, risky investment destination: Australia

via Zim, risky investment destination: Australia – DailyNews Live  7 MAY 2014

Australia says investing in Zimbabwe is extremely risky, likening the move to swimming in the dangerous crocodile-infested Zambezi River.

Matthew Neuhaus, the country’s ambassador to Zimbabwe, on Monday told a Sapes Trust conference that the southern African nation has a long way to go in attracting Foreign Direct Investment (FDI).

Investing in Zimbabwe is like swimming in the Zambezi between crocodiles and hippos,” he said, adding that “instead of policies to encourage FDI, you have chosen indigenisation, especially in the mining sector.”

He said Australian investors have found it easier to do business in Zambia and Mozambique, injecting billions of dollars in investment in their economies.

“Because of the uncertain political and economic environment, investors have skirted this country,” said Neuhaus.

“Certainly, indigenisation laws have been confusing, and the implication of the 51 percent ownership does not inspire confidence in investors. They want to know that their investments are safe and that they get what they put in,” he said.

He said government needs to boost confidence and attract investments, further stating that Zimbabwe’s harsh business environment and corruption were some of the factors that continue to scare investors away from the country.

This comes as in March, British deputy ambassador to Zimbabwe Chris Brown said investors remained worried about the perceived lack of respect for property rights and uncertain business climate in the country.

“If the government doesn’t  soon articulate a really clear approach on achieving empowerment and respect property rights, Africa, I fear, will continue to rise without Zimbabwe,” he said.

Brown said Zimbabwe had potential to attract more investment than most African countries but remained hamstrung by unfriendly policies and environment.

A recent report by Singapore-based Global Business Reports also ranked

Zimbabwe among the riskiest mining investment destinations despite its vast mineral wealth.

“However, certain points stood in its favour. These included last year’s ‘peaceful’ elections, and the undeniable mineral potential of the country,” read part of the report.

Zimbabwe holds an estimated 30 percent of the world’s diamond reserves as well as the second-largest known platinum deposits in the world after South Africa.

However, over the years the country has experienced a pronounced investor flight due to bad economic policies such as the land reform exercise and the indigenisation policy.

Although the southern African country has been labelled a high risk investment destination due to its political risk profile, authorities have been trying hard to prove to the world that Zimbabwe is changing for the better.

While officially opening the annual trade fair in Bulawayo last month, President Robert Mugabe assured investors that his government’s aggressive empowerment policies were not ill-intentioned.

Instead, the leader said Zimbabwe’s indigenisation policy had been misinterpreted.

“As originally set out, it (indigenisation) is meant to empower and integrate the majority of our people into the mainstream economy. The policy aims at achieving inclusive growth, sustainable development and social equity,” he said.

COMMENTS

WORDPRESS: 18
  • comment-avatar
    Angela Wigmore 8 years ago

    Too true blue!

  • comment-avatar
    Mlimo 8 years ago

    We heard in 1980 how Mugabe needed the white just go to you tube. He then kicks them out. Then he says they’re not wanted. Then he tells the west to go ” hang” . So far we have had land stolen from its rightful owners, cash assets stolen out the banks. Then we had businesses invaded and the owners told to leave. Then we had the banks indigenised. Then we had the remaining businesses indigenised. Then we had the zim dollar made worthless including my savings. Then we had the mines indigenised.
    Now they want to mortgage the minerals yet to be mined to china.
    They have striped the country bare of assets.
    We have seen the collapse of the Zimbabwe currency,
    The collapse of industry
    The collapse of farming and agriculture
    The collapse of most mines
    The collapse of the education system
    The collapse of hospital services
    The collapse of electricity supply
    The collapse of exports

    And they want investors?
    What planet are these morons from?

    • comment-avatar
    • comment-avatar
      Bingo Wajakata 8 years ago

      I could not have said it any better but I think there must be a stronger word that morons to describe these looters and murderers. Mugabe has destroyed the jewel of Africa yet he goes posturing around like a walking Egyptian mummy. My generation (Born 1960) suffered during the war and once again we suffer. At least I am thankful that so some time we had an opportunity to ride on the success of Ian Smith. The so called born free are the generation that have suffered the most and continue to suffer today. They were born free from hope, free from employment, free from everything good! Henzi I am educated with several degrees to my name. If I have learnt anything its that degrees dzomu prison hadzi iti count, Mugabe is my model for the hypothesis.

    • comment-avatar
      Petal 8 years ago

      They want the investors so they can CONTINUE putting their LONG STICKY FINGERS WHERE THEY DO NOT BELONG!

    • comment-avatar
      Wilbert Mukori 8 years ago

      Yapu, Mugabe thinks the investors will be assured to hear the crocodiles, as of now, are vegetarians!

    • comment-avatar
      Kusvikazvanaka 8 years ago

      Roads in Zim are full of potholes. Mines are owned by Chinese and Zanu PF chefs. Education has deteriorated to measurably lowest levels. There has been unstable and expensive electricity supplies since 1998.

  • comment-avatar

    Well said Mlimo. They have no clue on what to do next. Their bags of lies is empty and that is a state secret.

    • comment-avatar
      Wilbert Mukori 8 years ago

      I think Mugabe now knows that his continued rule will depend on him rigging economic recovery – which is not as easy as rigging the elections!

  • comment-avatar
    JOHNSON 8 years ago

    GO STRAIGHT TO THE POLICIES AND MAKE NEW ONES AND THROW INTO THE SEA THE BAD ONES. WHAT ARE YOU WAITING FOR. EVEN US LOCALS WE ALSO WANNA INVEST IN OUR OWN ECONOMY AFTER MORE THAN 20 YEARS OF INERTIA. GO TO THE POLICIES,….YOU ALREADY KNOW THE ONES WHICH NEED REFORM. ALIGN EVERTHING WITH OUR BRAND NEW CONSTITUTION AND ALL WILL BE WELL WITH YOU AND ALL OF US. ARE YOU HARD OF HEARING. IT’S TIME FOR REPENTANCE MY GUYS, MR CHINAMASA ET AL. PUT PRIDE ASIDE AND PUT THE NATION TO HEART. HOW LONG CAN THE NATION SURVIVE THE ‘CROC INFESTED WATERS…BY LUCK…LUCK WILL RUN OUT LATER OR SOONER’. WE NEED TO MAKE USE OF OUR LIMITED LIVES, SO DO YOU…UNLESS YOU WILL LIVE FOREVER LIKE PHARAOH!!! NO LAUGHING MATTER

  • comment-avatar
    mwana wevhu 8 years ago

    “JEHOVAH,Lord GOD Almighty, I pray you grant our ZANU’pf’cadres ears to listen to their fellow countrymen’s pleas.In JESUS’ name. AMEN”

    • comment-avatar

      I agree emwana. We need god’s mercy. We go around and around in circles. there is a easy answer but few want to see it. We are a sinful nation and are reaping God’s judgment. For as long as we will not confess and admit to our sin we will stay in the doldrums. Wake up ZPF. You, as the ruling party and with many ‘professing’ Christian can’t you see the folly of your ways. look at our nation! Look and see! the destruction is because of sin! Repent and ask for forgiveness and see what will happen. And that is for each one of us too!

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    masvukupete 8 years ago

    We need to cleanse the country of all the spirits of the thousands of innocent victims who were killed by both ZPF and the Smith. Ngozi yacho yakakurisa. These morons we call leaders are full of blood and their minds do not work properly coz of ngozi yemuhondo. So many people died just because they owned a business, or worked in town under the vatengesi banner. We need to cleanse all these people’s spirits and Mwari will clear the path to a successful nation. Unless we do that we shall forever languish in poverty, kana kuti vanhu vakaenda kuhondo vanofanirwa kutanga vapera. God said I will punish generations for the sins of their fathers. Ndo yatavakufira.

    • comment-avatar
      Angela Wigmore 8 years ago

      It is your stone-age thinking that keeps Zimbabwe locked in retrogression. How exactly do you propose ”cleansing the spirits”?

  • comment-avatar
    Petal 8 years ago

    Austrailia has done its homework!!

    • comment-avatar
      Nkiwane (M'kiwa) 8 years ago

      In fairness to the Australians, one must admit that they are consistent. They were hard, rude and forthright when dealing with the RF, and they are equally hard, rude and forthright when talking to ZPF.

  • comment-avatar
    Bill Mills 8 years ago

    No matter how grand the mineral wealth of a country, while the stuff is in the ground and mixed with dirt and rock, it has a ‘net present value’ of zero.

  • comment-avatar
    Wilbert Mukori 8 years ago

    For years Zimbabwe has failed to attract any significant FDI and even my aunt in Zimbabwe’s rural backwaters would understand Ambassador Neuhaus’ pithy but graphic explanation. To be fair to Mugabe and his cronies, they too now understand the investors’ concerns.

    Ten months of staring at that mockingly empty ZimAsset begging bowl have helped focus minds – sadly, not on the right thing.

    Finance Minister Patrick Chinamasa, Mai Mujuru and even Mugabe himself have all gone out of their way to assure would-be investors that the regime will not seize any of their investments. Minister Chinamasa has even done to the extent of calling Zanu PF’s 2007 indigenisation law, which forced all foreign owned companies to cede 51% shares to black Zimbabweans, as “nonsense” and that “it would never happen”!

    Of course none of the investors have found the regime’s words reassuring in any way. They know that as long as Mugabe and Zanu PF remain in power, the regime will re-activated the indigenisation law overnight and all the promises the regime made are of no consequence.

    To paraphrase Ambassador Neuhaus’ graphic language, “Investing in Zimbabwe is like swimming in the crocodile infested River. The only reassurance the regime is offering is that all the killer crocodiles, as of now, are on a vegetarian diet!”