The Davos summit in
Switzerland is attended by the world’s powerful leaders both in the political,
business and economic spheres.
The summit seeks to open
dialogue on how best the world can drive economic growth, galvanise private capital and to some extent push
the agenda for globalisation. This year's World Economic Forum is running under the theme, “Creating a shared future in a
fractured world".
The theme is very apt
considering isolationism being driven by the world's biggest economy, the
United States, Britain's exit from the European Union, and conflicts in the
Korean peninsular, Middle East, West
Africa and Eastern Europe.
Developing countries
attending the four day meeting usually seek new and old partners to build and further grow
relationships and their economies. For Zimbabwe 2018 is the first time in history that her head of state
has ever been invited to this kind of forum. Possibly in subscribing to
consistency, in his first 60 days as president of Zimbabwe Mr E.D Mnangagwa has maintained his mantra
that also livened up
his inauguration speech...."Zimbabwe
is open for business".
Under
the rule of Mr Mugabe,
his predecessor, Zimbabwe was a closed society not open to the family of nations. Zimbabwe has got a fractured economy and a president that is seeking re-engagement with
international partners whilst Davos has a theme that speaks to
a shared
future, one gets a feeling that this blending might chart Zimbabwe on a path to re-discover itself though
challenges should
be expected on the way. There
seems to be a shift from political rhetoric to renewed focus on economics and
trade. In that same
vein there is hope that this can pave way for
new
and fresh FDI that can take
the economy forward through increased production and exports.
In the discussions at Davos, Zimbabwe's president singled out agriculture
and mining as the
two sectors the current government will work on heavily in order to revive the
economy. Having spearheaded a largely successful Command Agriculture program,
Mnangagwa seems eager to put back the ‘breadbasket’ tag on Zimbabwe again.
Growth in the agricultural sector will revive the export market through
increased productivity in small grains, dairy and tobacco which all along has
been one of the biggest sources for foreign currency.
The Indigenisation Act
has been the stumbling block to investment in the mining sector which required
foreigners to cede 51% of their shareholding to locals. However the recent
budget statement from Mnangagwa’s government has brought some wholesale changes
to the Indigenisation Act with platinum and diamond being the only two minerals
that require a certain threshold of local participation in terms of
shareholding. Commodity prices have been on a rebound and with improvements in
the mining sector more valuable contributions will be realised in the economy.
At the same time after 37 years of independence the country still does not add
value on their minerals so an opportunity exists for value chain industries
that deal with beneficiation.
Corruption in Zimbabwe
has blighted economic progress and massive scams have been and continue to be
unearthed. The previous government was not pro-active in exorcising and putting
up measures to curb corruption. Though the new president has been part of the
previous government he has promised zero tolerance on corruption. FDI will
always be difficult to source in an environment that is ripe with corruption
and there is never meaningful development when a society is plagued in
corruption. Corruption remains a vice that has to be ridden of if Zimbabwe is
to attract high levels of foreign investment. The dealing of corruption matters
in the country will directly determine the flow of investment in the country.
Transparency has to be at the core of government operations and red tape should
be minimised through adoption of technologies that drive efficiency.
The holding of
elections is an inevitable process this year as the Constitution clearly
outlays. The holding of free, fair and transparent elections will not only
legitimise the government of the day but also drive investor confidence. The
invitation of the international community to monitor the elections might be one
way of re-engaging the international community. Proposals and talk of
reengagement with the U.K, which has historical ties spanning economic,
political and social spheres sounds much encouraging given the economic and
perhaps social benefits that may trickle through. The same can be said with
efforts of getting Zimbabwe back to the Commonwealth grouping.
On the social front, Gukurahundi remains a thorn in
Zimbabwe’s social fabric. It is arguably one of the saddest part of Zimbabwe’s history.
In that regard, there is need to immediately deal with this issue with great
effort and heartiness as there is no form of economic prosperity that can ever
oblique social injustices. In this vein the government needs to dedicate effort
and resources to national healing and reconciliation. The same also applies to
other atrocities such as election violence, inhumane displacements, fast track
land reform and pre-independence conflicts.
Much emphasis has to be
placed on manufacturing, energy development and technology as the pillars that
can drive economic recovery outside of mining and agriculture. The country has
an acute shortage of electricity and this area has to be addressed with the
adoption of green energy solutions like, solar and bio-energy, which has
tremendous potential in Zimbabwe. Technology advancement, through promulgation
of effective legislation should be used to drive industrial efficiency. Once
effective technological and energy systems are put in place, the manufacturing sector
will grow rapidly.
Above all Zimbabwe has got to draw up more
economic reforms and draft flexible legislation. Zimbabwe can draw wisdom from WEF’s
mission statement which says it is “committed to improving the state of the
world by engaging business, political, academic, and other leaders of society
to shape global, regional, and industry agendas”. Beyond policy, rhetoric and
international meetings, Zimbabweans need to find each other in reviving the
economy. Engagement of business, political, social and academic leaders is key!
Adrian F Mapiye & Ngonidzashe Makaha
