Africa’s leading non-banking financial services group, Imara, has postponed its Zimbabwe investment conference to June 2019 because of that country’s fickle economy.
Imara operates directly and through partners in 10 African countries and has an office in London. It has been at the forefront of African capital markets for more than 60 years and was involved in the establishment and growth of stock markets across Southern Africa, in Botswana, Malawi, Swaziland, Zambia and Zimbabwe.
Zimbabwe’s economy was sent into a tailspin shortly after its disputed general election in July with acute currency shortages, a thriving currency black market, steep price increases and shops not stocking basic commodities.
In a bid to attract investment, newly installed finance minister Mthuli Ncube has introduced a raft of structural economic changes.
The economic situation was further worsened by a cholera epidemic with more than 54 people dead and 10,000 affected amid an acute shortage of drugs. The few drugs available have more than doubled in price.
The Imara event, which attracts top local and international companies, investors and fund managers, will now take place in mid-2019, when the group expects a “more predicable” economic environment.
Economic experts say the postponement of the event is a blow to the “Zimbabwe is Open for Business” campaign, introduced by the Zanu-PF government to attract investment in the struggling economy.
The conference was expected to be one of the highlights on Zimbabwe’s business calendar and had become a useful forum to gauge investor interest.
In an interview with Business Day, Imara Zimbabwe MD Thedias Kasaira said new policy measures announced by government meant that more time was needed for companies to present their plans to investors. The bulk of companies listed on Zimbabwe’s Stock Exchange were expected to attend the conference.
“With the recent monetary and fiscal policy statements and the publication of the transitional stabilisation programme announced by the president, as well as the fact that the budget for 2019 will only be presented in late November or early December, it was determined that it would be difficult for listed companies to fully digest and plan their strategy going forward in the new environment by mid-November.”
In a notice announcing the postponement on Tuesday, Imara noted that Zimbabwe’s macroeconomic environment had become unpredictable.
“We have been overtaken by both economic and geopolitical events, which have rendered the short to medium-term macroeconomic environment unpredictable. This has placed local companies in a very difficult position to speak about operations as most of them are strategising in this changing environment.”
Imara suggested in the notice, that by mid-2019, Zimbabwe’s economic implosion could be more predictable
“With this in mind and upon consultation with the local companies, we believe it is in the interest of all stakeholders to defer the conference to 2019, when we can foresee a more predictable medium to long term path post full year fiscal and monetary budgets policy announcements.”
Asked why he thought Zimbabwe’s economic conditions would have improved to host the conference in 2019, Kasaira said: “We anticipate that the ongoing fiscal and monetary measures being undertaken by government will give some positive results.”
Sifelani Jabange, the president of the country’s industrial body, Confederation of Zimbabwe, said the government should implement its economic reform measures immediately so that business can be able to digest the new policies quickly.
“We call on stakeholders to accept this painful necessity to stabilise the economy, we also call on the government to play its full part in stabilising the economy and sharing the associated pain by implementing the measures as outlined in the transitional stabilisation programme and returning to zero deficit position as soon as possible,” said Jabangwe.
Economist John Robertson said the rescheduling of the conference to 2019 was just the tip of the iceberg in Zimbabwe’s economic crisis.
“It is sad that such an important conference has had to be cancelled. What I know for certain is that it is not the only one that will be cancelled, there are many others.
“It is just a sign of the economic environment. There is a lot of unpredictability. Logistically, it is very difficult to hold such a major event because the prices are going up every day.
“Then from a business point of view, no one knows what is going to take place tomorrow so it is better to wait and see,” he said.
Robertson implored the Emmerson Mnangagwa government “to do more than just talk” to prove that the country is really open for business.