THE Mutapa Investment Fund (MIF) has to date undertaken a structural overhaul on a number of ailing State-Owned Enterprises (SOEs), realigning them for a swift return to productivity in the country's key economic sectors.
Zimbabwe's first Sovereign Wealth Fund's (SWF) origins can be traced back to a mining sector policy study conducted in 2012 that recommended the establishment of the fund to drive long-term investment leveraging on mining, natural and other resources that would anchor inclusive economic growth and development.
Formerly the SWF, the MIF was established by an Act of Parliament in 2014 called Sovereign Wealth Fund Act (Chapter 22:20) and is currently led by John Mangudya as its chief executive officer.
In September 2023 it was renamed to Mutapa Investment Fund through Statutory Instrument 156 of 2023, by President Emmerson Mnangagwa using the Presidential Powers (Temporary Measures Act).
Since kick starting operations around April 2024, the MIF has undertaken work aimed repositioning SOEs to productivity.
For instance, new board members for Air Zimbabwe and Allied Timbers were appointed as part of its efforts to revitalise these SOEs.
Silvanos Gwarinda has been appointed as the chairperson of the national airline, with Precious Sibiya serving as his deputy.
Other notable board members include veteran banker Onesemo Mukumba, Lilina Chigodora, and Farai Mpofu.
Within a short space of time, the MIF has organized 66 companies into five clusters to optimise benefits. For instance, under the natural resources cluster are entities such as Kuvimba Mining House.
The energy and trading cluster includes Zimbabwe Electricity Supply Authority (ZESA), the country's power utility and the National Oil Company of Zimbabwe while the infrastructure has entities such as the National Railways of Zimbabwe (NRZ).
Other clusters include industrials, financial services and real estate.
Speaking during a panel discussion recently, Mutapa deputy chief investment officer, Ernest Denhere said more work to attain full scale efficiency is still in the pipeline.
"We have developed an investment strategy and clustered the fund into five main sectors: natural resources, energy and trading, infrastructure, industrials and financial services and real estate. We are focusing on infrastructure, mining and energy as enablers for economic growth, aligning with the government's Vision 2030 aspirations.
"To achieve this, we need to address governance issues, upskill and train board members, and ensure the portfolio companies are fit for purpose," Denhere said.
He said going forward, the fund's strategy will be underpinned by giving the portfolio companies autonomy to make commercial decisions, unwind legacy debt, and embrace innovation.
The fund has undertaken an aggregated assets valuation exercise placing the consolidated value at US$16 billion.
Sources confirm that behind the scenes, work is currently underway to extract indebted companies from the doldrums and find a lasting solution towards clean balance sheets.
The fund has since commenced negotiations with Cold Storage Commission (CSC) creditors, who include the ZESA Holdings, the National Social Security Authority (NSSA), and urban councils in Bulawayo, Harare, and Chinhoyi in a bid to inject capital into the concern and help it to spur operations.
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Recently, the MIF also approved a significant joint venture valued at US$350 million between Indian firm Jindal Africa Investments and ZESA to refurbish six units at Hwange Thermal Power Station.
Financial analyst, Owen Mavengere said MIF is approaching the tasks ahead through the right procedure.
"In the short-term period 6-12 months, the MIF has to begin with immediate actions such as implementing transparency measures, conducting audits, and setting up the oversight bodies in the subsidiaries. Initial steps in digitising processes and reducing red tape can also start in this period.
"In the Medium-term (1-3 years): Focus on deeper structural changes, including full digitisation of processes, comprehensive workforce optimisation, and instilling a culture of accountability and efficiency."
