22 November 2008
ZIMBABWE presents vast opportunities for investors who can take advantage of the bright economic recovery prospects brought about by a new political dispensation, a top LonZim executive said last week.
Presenting a paper at the Institute of Chartered Accountants of Zimbabwe (ICAZ) investment conference, Rosinah Hove, the assistant LonZim country manager, said the country was still an attractive destination for foreign investors despite its long running political and economic problems.
"Zimbabwe presents a great opportunity for shrewd investors to come in," she said.
In a paper titled "The Effects of Indigenisation on Foreign Direct Investment, A Foreign Investor's Perspective", Hove said although investors were discouraged by the absence of the rule of law, lack of respect for property rights and economic freedoms, LonZim was undeterred as it continued to invest in the country.
"If we achieve long-term capital for our investors, we would have achieved," she said.
LonZim, where Lonrho Plc has a 20% stake, is listed on the Alternative Investment Markets in UK.
It raised US$65 million at its initial public offering and the proceeds have been used to acquire businesses in Zimbabwe and Mozambique. As part of its acquisition drive, LonZim acquired a 60% stake in the Zimbabwe Stock Exchange listed Celsys. It also owns Gardoserve, the largest blenders of ethanol products in the country, Paynet and a hotel in Mozambique.
Hove said LonZim plans to develop a five-star hotel with conference facilities, a training centre and retail mall among other developments in Zimbabwe. The company's acquisitions are not targeted at specific sectors, as every sector of the economy is poised for growth, Hove said.
But she expressed concern that the Indigenisation and Economic Empowerment Act that became law in March would discourage investors if not properly explained.
The Act stipulates that 51% shareholding in all foreign owned firms operating in Zimbabwe should be in the hands of locals.
The one-day ICAZ investment conference drew participants from all sectors of the economy and was held under the theme, "Repositioning for Zimbabwe's Economic Revival: Are we Ready for the Great Leap Forward?"
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