Zimbabwe’s post-Mugabe era could dwarf Zambia’s investment prospects in agriculture, investment analysts say.
Some experts believe Zimbabwe is likely to draw renewed interest from investors, given its huge agricultural and industrial potential.
“There is a strong possibility that renewed investor interest in Zimbabwe will come at the expense of countries like Zambia. Potential investors in agriculture, manufacturing and other sectors might perceive bigger and better prospects there,” said investment consultant Nkuruma Chama-Kalaluka.
In the late 1990’s, Zimbabwe had a well-developed industrial sectors in Africa. Agriculture was the most important economic activity, with about 60% of industry being agro-based. The sector made up about 20% of industry’s total output and employed a large proportion of the country’s labour force. In a normal year, it contributed around 18% to GDP and made up 40% of export earnings.
Among its major exports in the 1990’s were tobacco, cotton, sugar, maize, tea, coffee, horticultural crops, fruit, vegetables and beef.
RAISE THE BAR
“This simply means that Zambia has to raise the bar not to be eclipsed by Zimbabwe’s attraction to investors,” said Chama-Kalaluka.
“Zambia should consider further improving conditions for business. Factors that impede business, such as bureaucratic red tape and inertia, and delayed fulfilment of contractual obligations, must be addressed for Zambia to positively differentiate itself and retain investor attractiveness,” he said.
Zimbabwe hit economic headwinds following international sanctions, capital flight and successive droughts. The country’s GDP dropped by more than 60% and agricultural output declined by 51%, while industrial production decreased by more than 65%. This as inflation rocketed to 66 000% and unemployment rose to 95%.
New President Emmerson Mnangwagwa says he will put Zimbabwe back on a path of economic growth by encouraging foreign investment inflow and ending decades of international isolation.