Zimbabwe’s FDIs tipped to surpass US$3 billion in 5 years on new deal by ZBCA and ZIDA

By Esther MULWA

A recent penned memorandum of understanding (MOU) between the Zimbabwe Building Contractors Association (ZBCA) and the Zimbabwe Investment and Development Agency (ZIDA) is expected to pump in Foreign Direct Investments (FDI) worth over US$ 3 billion in the next five years, according to ZBCA president Dr Tinashe Manzungu.

Currently, FDI inflows have fluctuated, averaging between US$400 million and 500 million annually in recent years according to the Zimbabwe National Investment Policy. It is against this background that Manzungu noted that the forecast for FDI growth following the marriage between ZBCA and ZIDA will be standing at 10-15% per annual.

“The impact of the collaboration between ZBCA and ZIDA could realistically aim for: 10-15% Annual Growth Rate in FDI attributable to improved processes, investor confidence, and targeted promotions,” he said.

He said using the baseline of US$ 500 million as a base line for year one, year two has a forecast of US$ 550 million (10% increase); year three US$ 605 million; year 4: US$ 666 million; and US$ 733 million year five.

Manzungu also noted that the marriage between ZBCA and ZIDA plays a crucial role in facilitating FDI indicating that the union brings key aspect such as streamlining investment processes; building Investor Confidence; facilitation of Public-Private Partnerships (PPPs); enhancing Skills and Capacity Building and promoting Sector-Specific Opportunities.

“The partnership can enhance investor confidence by providing clear and consistent information about the construction sector in Zimbabwe. ZBCA, as a local authority, can offer insights into the reliability of local contractors, the quality of construction materials, and the market’s overall stability.

Together with ZIDA, they can develop comprehensive investment guides and reports that present Zimbabwe as a viable and attractive option for foreign investors,” said Manzungu.

He said the partnership has a great potential to enhance skills and capacity building in Zimbabwe as the two parties can work together in facilitating training programs aimed at enhancing the skills of local contractors. Manzungu noted that the training will see foreign experts and companies to engage in capacity-building initiatives with the local ones.

Manzungu added, “A more skilled workforce will assure foreign investors of the quality of work and competitiveness of the local construction sector, thus making Zimbabwe a more attractive investment destination.”

“The duo can advocate for favorable policies that enhance investment conditions in Zimbabwe. ZBCA can leverage its industry knowledge to provide feedback to ZIDA on existing policies that may hinder investments and suggest improvements.

A coordinated push for reform can lead to a better business environment, attracting more foreign investors,” he said.

The ZBCA President also highlighted that, the MOU has a potential to enhance southern regional collaborations in infrastructure development.

He added, “The essence of an MOU in the context of infrastructure development in Zimbabwe and other Southern African countries lies in its ability to formalize cooperation, establish a framework for collaboration, and outline the mutual goals and responsibilities of the involved parties.

Here’s a closer look at the significance of the MOU and its relevance to infrastructure development in the region”