PROJECTS worth more than $300 million in the manufacturing sector are failing to secure funding and this has been attributed to policy inconsistencies by the government.
Report by Gamma Mudarikiri
The situation is worsened by the discord in the implementation of the indigenisation law and uncertainty surrounding forthcoming polls.
A cement manufacturing project in Masvingo worth $250 million under Kenos Products (Pvt) Limited, is still failing to get an investor, with the management of the company saying the project has been frustrated by policy inconsistencies. The company’s executive chairman, Godfrey Gonese told Southern Eye Business that they were failing to court investors to partner in the project because of the indigenisation law.
He added that the Mines ministry was now threatening to repossess the cement claims as the company was failing to develop them.
“The Ministry of Mines has already indicated that it will repossess our claims and give them to the Chinese because we have been failing to develop them,” he said.
Gonese said the project has a potential of employing 600 people if it were implemented and became fully operational.A multi-fruit processing project seeking an investment worth $22 million is still on standby in Manicaland, while another one for processing of avocado pears into edible oils and skin care oils for discerning international markets at an investment of $4 million, remains in the pipeline also due to lack of funds.
The value of investment projects approved by the Zimbabwe Investment Authority declined by 76% to $36,9 million, during the first quarter of 2013 from $152 million during a comparative period last year. This was attributed to an unfriendly investment climate chiefly due to policy misalignment worsened by the uncertainty surrounding the coming elections.
According to the Confederation of Zimbabwe Industries capacity utilisation in the manufacturing sector is this year expected to further plunge to below 44% as the economy takes a knock due to political uncertainty and limited lines of credit.