People Wait for Zimbabwe’s Mega Deals to Materialise

Together with the enthusiastic support of state media, Mnangagwa and his officials have announced more than $27bn of planned investment ranging from new platinum mines to steel mills and hydropower dams. Medicines, fuel and foreign currency are in short supply, prices of basic goods such as bread are surging and the International Monetary Fund has forecast the first economic contraction in 11 years. And many of the investment projects announced by the government haven’t progressed beyond the memorandum of understanding or feasibility stage. Few companies with a “rational level of risk appetite” will invest in the country in its current state, said Jee-A van der Linde, an economist at NKC African Economics. The African Development Bank estimated foreign direct investment last year at $470 million, about a third of the $1.1 billion attracted by northern neighbor Zambia and a fraction of the $2.3 billion that flowed into Mozambique, which lies to the east. For some Zimbabweans, the investment pledges evoke memories of Mugabe, who was prone to announcing mega-deals that didn’t materialize. For example, in September 2017 Mugabe announced plans to revive Zimbabwe Iron & Steel Works Ltd., once the second-largest steelmaker in sub-Saharan Africa. The project never got off the ground.

SOURCES: AL JAZEERA

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