Dangote test for Zim’s business climate
Zimbabwe in 2010 launched a “One Stop Investment Centre” meant to facilitate easier and faster processing of new investment into the economy.
The centre was going to reduce processing of applications for setting up business from about three months to about a week, the nation was told.
But years down the line, this has turned out to be a fluke as investors still struggle, with many giving up in the middle of the process.
In his 2015 State of the Nation address which he delivered last week, President Robert Mugabe said creation of the “one stop investment centre” was a “high and urgent priority for which those responsible will be held to account.”
A variety of measures were being taken to improve the economy’s “ease of doing business” by end of this year, he said.
The road to investing in this country appears not for the faint hearted as a lot of bureaucratic red tape stops investors in their tracks, and figures released yearly by the Zimbabwe Investment Authority (ZIA) testify to this.
Year in, year out impressive investment proposals are approved but a minority of them see the light of day.
Whatever the reasons for their failure to be realised, it brings out the complications in setting up shop in this economy, at a time when the country is in dire straits and thirsty for new investment.
These difficulties have benefited neighbouring countries that apparently have managed to treat investors with gentle hands.
Aliko Dangote, Africa’s richest man with a net worth of over $15 billion came to Zimbabwe on Monday and made firm assurances to invest, bringing smiles to the faces of many Zimbabweans, according to comments on social media.
“We are not here looking to invest, we have already made up our mind to invest, so we are here and we will invest,” Dangote said after meeting President Mugabe.
The man means business and is known for sticking to his word.
Three key projects, whose investment will run into billions, were cited namely cement production, power generation and coal mining.
But the catch phrases for the realisation of the projects were to follow; “You know there are so many permits (that we have to obtain first) and Government has promised to accelerate the process. As soon as we get things right, we will move,” Dangote said.
And this is where government has seemingly failed to get it right in the past. Fresh in the minds of most Zimbabweans is the Ziscosteel and Essar Africa Holdings deal.
Now labelled mysterious by some, the revival deal, at that time the biggest foreign investment deal to have been signed, appeared to shine some light in the midst of economic despair, only to slowly fade for reasons Government is yet to come clean about.
So many stories were told, of disagreements over licences and permits for one thing or the other.
And four years after the $750 million deal was penned, there is still no smoke coming out of New Zim Steel, let alone small signs of life at the once giant steel maker.
Sceptics have also cited corruption as well as bribe seeking officials as potential obstructions to Dangote’s investment deals.
Even President Mugabe has in past also expressed concerning on the behaviour of top officials who seek bribes to facilitate certain procedures. And it is the hope of every Zimbabwean, especially at this time after thousands of workers were sent packaging following the landmark July 17 Supreme Court ruling, that Dangote’s wish to establish ventures in the country will not follow the mystery of New Zim Steel.
And that with support from the Highest Office in the Land, the Nigerian mogul will begin setting up his business empire in this country possibly in the first half of 2016 as he stated.
In countries where he has ventured through his Dangote Group, among them Zimbabwe’s neighbours South Africa and Zambia, the economies have not only benefited in terms of the investment alone but also employment creation, among others.
The Nigerian-headquartered conglomerate also has operations in Benin, Cameroon and Ghana.
Dangote’s investment proposals will be a test case for the Zimbabwean Government and specifically the Ministries of Industry, Energy and Mining on their ability to fast-track such a major investment deal in the shortest possible time.
This particular investment might be what Government needs to walk the talk on improving the country’s “ease of doing business.”
It might also be the gateway to attracting investors for the investment thirsty economy.
Next week, Dangote’s team of experts are expected in the country to start the ball rolling and the nation will be watching eagerly how Government will handle the transaction. — New Ziana.