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Zim economic rebound needs a stable political environment

by Victoria Ruzvidzo
07 May 2011 at 18:51hrs | Views
Zimbabwe's economy is on a rebound that now needs to be sustained by a more stable economic and political environment. This came out clearly at the World Economic Forum on Africa dinner hosted on Wednesday to discuss this country's future. Government representatives, the private sector and internal and external partners represented at the dinner spoke glowingly about opportunities in the country. The convergence of minds on the future of the country was evident. Prime Minister Morgan Tsvangirai said on the economic front, the inclusive Government had achieved macroeconomic stability while progress had also been noted in social sectors such as health and education.

"There have been notable progress in terms of containing hyperinflation and reviving social sectors of health, education and water," he said, stressing that instability noted on the political front in recent months had, however, burst the initial bubble, with investors adopting a waitandsee attitude.

He said the US$100 billion economy target by 2030 was achievable and the economy could sustain a 10 percent annual growth over the period.

Key issues that needed attention were policy consistency and a stable political environment

Deputy Prime Minister Arthur Mutambara and other ministers Saviour Kasukuwere, Tapiwa Mashakada, Mrs Sithembiso Nyoni, and Minister in the Prime Minister's office Mr Jameson Timba all expressed optimism on the future of the economy.

Minister Mashakada said investors had rekindled interest for Zimbabwe, particularly in the mining sector.

Although Zimbabwe was ranked lowly on the Global Competitiveness Index, efforts were being made to ease bureaucracy for investors applying to set up shop in Zimbabwe, through the creation of the onestop shop under the Zimbabwe Investment Authority.

The aim was to reduce the application processes from 45 days to five days. Other strategies were being implemented to attract investment.

"Zimbabwe is back to the party and we applaud efforts of Sadc and everyone in integrating us with the rest of the world," said Mr Mashakada.

Speakers from industry who included the moderator Kingdom Bank founder and director Nigel Chanakira, African Sun chief executive Dr Shingi Munyeza, ZB Holdings group chief executive Mr Elisha Mushayakarara, African Developemnet Bank's Dr Nkosana Moyo and Chairman of West Zimbabwe Mr Ken Sharpe gave sectoral overviews on the economy. Their emphasis was on the potential resident that could foster economic growth going forward.

The dinner, which was oversubscribed as scores of guests had to be turned away, was also attended by South African Minister of International Relations Maite Nkoana Mashabane, Graca Machel, Afreximbank President Mr Ekra, IMF director for Africa Annoinette Sayeh, among other regional and international partners.

Mrs Nkoana Mashabane said Zimbabwe remained a formidable force on the region's economic landscape, challenging the country to regain its status as Sadc's breadbasket.

"Zimbabwe is this most diverse economy not only in the region but on the continent. We want this giant to rise up now. We want Zimbabwe to take her rightful place to integrate regional economies. We want Zimbabwe to take her rightful place when we broaden Sacu and the integration of the whole continent," she said.

Mr Ekra said Afreximbank would continue to offer financial assistance to Zimbabwe wherever possible.

"We are hear to confirm our support for Zimbabwe. We believe in Zimbabwe and we have not lost any confidence in the country and we believe it's a place where we can do business," he said.

The IMF said it was offering Zimbabwe immense technical assistance on the fiscal and monetary front but remained constrained to offer financial support.

Ms Sayeh noted developments on the macroeconomic front but stressed the need to contain the civil service wage bill, which was causing budget overruns.

The four critical areas that needed attention according to the lender were the need to rebuild a fiscal buffer, containing financial sector vulnerability, implementation of structural reforms such as containment of labour costs and the huge debt burden now believed to have reached US$9 billion.

"We are happy to be able to provide technical assistance and that we can do for now," said Ms Sayeh.

Dr Munyeza and Mr Mushayakarara also took the guests through the tourism and banking sectors of the economy tabulating the opportunities resident in these sectors and their increasing contribution to economic growth.

Overall, guests at the interactive dinner were in agreement that a more stable operating environment would see Zimbabwe claim its fair share of the global economic cake.

Source - Herald