Blow for Mnangagwa as Zimbabwe ranked among Africa’s worst investment destinations

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PRESIDENT Emmerson Mnangagwa’s bid to woo investors using a recent investment conference he attended in Abidjan, Cote d’Ivoire could turn out to be a wild goose chase after a report released during the conference ranked Zimbabwe among Africa’s worst investment destinations.

According to the 2018 Africa Investment Index by Quantum Global Research Lab, an independent research arm of Quantum Global, Zimbabwe is number 45 out of 54 countries on the continent.

The report ranked Morocco as top and being the most receptive business environment with a low risk profile. Central African Republic is bottom of the pack.

The Africa Investment Index is compiled annually and is meant to paint a picture of the investment attractiveness of countries in the medium term.

The report, released on the side-lines of the Africa CEO Forum in Abidjan, measures six major factors: growth, liquidity, risk, business environment, demography and social capital, to determine the investment attractiveness of countries in the medium term. In essence, it seeks to provide a snapshot of the investment climate in the 54 countries in Africa.

Apart from Morocco, other countries with the most attractive investment climates are Egypt, ranked second, Algeria, Botswana, Cote d’Ivoire, South Africa, Ethiopia, Zambia, Kenya and Senegal in that order.

The bottom 10 African countries in attracting investment are, in the order of worst to best, Central African Republic, Liberia, Somalia, Eritrea, Equatorial Guinea, Gambia, Sierra Leone, Guinea, Sao Tome and Principe as well as Zimbabwe.

In his covering note, Quantum Global Research Lab Managing Director, Professor Mthuli Ncube said Zimbabwe’s investment climate was deteriorating.

“In terms of improvement in the ranking over the last three years,” he said, “countries such as Swaziland, Angola, Rwanda, Chad, Comoros, Seychelles, South Sudan, and Sierra Leone registered strong upward movements…Zimbabwe, Tunisia, Mozambique, Namibia and Cabo Verde, have shown deteriorating positions.”

The report is a slap in the face for President Mnangagwa, who told the CEO forum attended by 1,600 investors and business leaders that Zimbabwe was “alive to the fact that capital goes where it feels safe”.

Mnangagwa is at pains to convince the world Zimbabwe was back to political and economic stability following years of turmoil under ousted President Robert Mugabe.

He added during the forum, “We continue to put in place all necessary measures that will entrench our democracy and lower the risk of doing business in our country.

“We guarantee the safety of all investments and the respect of property rights, Bilateral Investment Promotion and Protection Agreements (BIPPAS) and the right of investors to repatriate profits within the confines of our laws.”

When he became President last November, Mnangagwa lost no time in scrapping the country’s controversial indigenisation law which has been blamed for the flight of FDI in the once prosperous country.

However, apart from pledges to the new government by a few foreign investors, the country is yet to witness any tangible investment from outside as foreign businesses take time to understand Zimbabwe’s Zanu PF administration that has only elbowed out Mugabe from the equation.