Only new leadership can lure investors to Zimbabwe

A CONSULTANT has said there is need for new leadership in the country to deal with Zimbabwe's negative investor perception.

According to South African independent economic and political analyst Daniel Silke, who was engaged by the Office of the President and Cabinet (OPC), investors viewed Zimbabwe negatively due to its $7,1 billion external debt, land reform programme and indigenisation laws.

Speaking at an Ease of Doing Business workshop in Harare yesterday, Silke said investors were also uncomfortable with the country's outdated and complex regulatory structure.

"Many global investors perceive Zimbabwe's accumulation of external arrears, the implementation of land reform and indigenisation to be sources of uncertainty and those issues clearly I think will have to be resolved. Perhaps new leadership going forward will look into those issues in some substance in the near future," he said.

"I am pleased that the government is now taking steps to reform the business climate in this country. Zimbabwe has often complex and outdated regulatory structures and those have been obstacles to investment, to diversification and being competitive."

However, he acknowledged the efforts being made by industry and government in trying to look into some of these issues.

"I am pleased to see that these issues are now finding an ear across the board," he said.

The suggestion comes as government policies have continued to remain widely unpopular across the board due to their increasingly protectionist nature.

This has led to many investors, both private and foreign, refraining from investing in the economy.

Despite many policy recommendations by international institutions, economists, private and at times the public sector individuals based on market evidence and public sentiment, government has largely remained unconcerned.

Some of the more popular suggestions made include updating outdated laws, which are lagging and changing monetary and fiscal policies, such as adopting the South African rand and reducing expenditure, specifically the wage bill.

Businesses have also called on a reduction to duties and additional taxes to spur growth.

A study from the United States Agency for International Development done last year, found that there was need for government to change a lot of its policies in order for the economy to grow.

Deputy Chief Secretary to the President and Cabinet, Ray Ndhlukula, said the OPC had engaged Silke and another consultant, Dirk Elzinga, in February this year to find out where government could improve based on findings of neighbouring countries.