THE African Development Bank (AfDB) says implementation of investment projects since 2008 has been a paltry 6,9%.
Report by Victoria Mtomba
During 2008-2011, actual investments in the country amounted to $709,5 million out of $10,2 billion investment projects approved by the Zimbabwe Investment Authority (ZIA).
According to the AfDB monthly economic review for the month of May, the regional lender said: “Although ZIA approval figures show that foreign investors have an intention to invest in the country, actual investment has always been far less than the approved levels over the years.
“This gives an implementation rate of only about 6,9%, which is worrisome for a country that is desperately in need of investment.” AfDB said the one-stop shop launched in 2010 was expected to result in more investment as it shortened the number of days taken to register companies, but that had not been the case.
“The reasons for the low implementation rate need to be investigated to address the bottlenecks delaying implementation of approved investment projects,” said AfDB. “The ZIA also needs to put in place monitoring mechanisms to ensure that the reasons for the lack of actual investment after registration are fully understood and addressed. While some of the reasons could be speculative tendencies as well as the normal time between approval and investment.”
AfDB said there was need to invest in new technology to replace antiquated one to grow the manufacturing sector that is collapsing.
The manufacturing sector is facing challenges that include the unavailability of long-term capital, shortages of utilities and company closures, as they cannot compete with companies in the region.
In a recent World Bank and International Finance Corporation Doing business report, Zimbabwe dropped to position 172 this year from 170 last year, out of the 185 countries.