Home » Governance » ZimAsset Doomed Without Reforms – Us Envoy

US Ambassador to Zimbabwe, Bruce Wharton says government’s new economic recovery strategies, underpinned by the ambitious Zimbabwe Agenda for Sustainable Socio-Economic Transformation (ZimAsset) blueprint, face major hurdles ahead if the current Zanu PF led government does not reform.

Ambassador Wharton, who was addressing delegates to a Business Conference at the ongoing Zimbabwe International Trade Fair in Bulawayo Wednesday, said Zimbabwe must abandon its tough empowerment policies and start inspiring confidence among existing and potential investors if it entertained any hopes of seeing the country’s economy recover.

This, he said, involved the softening of its empowerment policies, which have a heavy bias towards resourceless locals.

“The essential basis for a growing economy is confidence. Confidence that government policies will be predictable and implemented consistently confidence that private property and intellectual property will be protected confidence that courts will treat all people fairly in accordance with the law. Without confidence in these and other basic governance processes, domestic and foreign businesses are reluctant to invest,” Ambassador Wharton said.

President Robert Mugabe’s Zanu PF, which won the July 31, 2013 elections with an overwhelming majority, promised to deliver 2,2 million new jobs in a country reeling under record breaking unemployment.

But Zanu PF opponents accuse the ruling party of failing even to create a single job, 10 months after earning a new mandate.

Investors are also concerned about the 51 percent equity they must cede to locals as part of Zimbabwe’s controversial empowerment policies.

In a televised address during celebrations to mark independence last Friday, President Mugabe was at pains to assure foreign investors his country’s investment policies were not intended to grab any wealth from foreigners.

Mugabe said his government will spare from any empowerment requirements, any foreign firms based locally which are obtaining raw materials from outside.

His comments follow similar suggestions by indigenisation minister Francis Nhema recently that government was softening its hardline approach towards foreign investments.

Finance Minister Patrick Chinamasa said Tuesday the Zanu PF led government had no intentions of grabbing any equity from foreign banks, a totally different chorus from that of former indigenisation minister Saviour Kasukuwere who vowed no foreign firm shall be spared.

The Mugabe led government is under pressure to reverse the current economic downturn at a time its wage bill was chewing the bulk of the national purse.

Industry, which is yet to recover from the economic meltdown of the hyperinflationary period and continues to face stiff competition from cheap imports, has been scaling down significantly while other companies are totally shutting down.

According to the Zimbabwe Congress of Trade Unions (ZCTU), more than 75 companies closed shop last year, forcing hundreds of workers onto the streets.

Another report by the National Social Security Authority (Nssa) revealed for the period between July 2011 and July 2013, 711 companies in Harare closed down, rendering 8 336 individuals jobless.

Source : New Zimbabwe