Zim seeks to lure foreign investors

HARARE – Zimbabwe’s central bank announced yesterday a new measure to attract much-needed foreign investment: a guarantee to pay back the entire capital within three months if investors decided to leave.

“We have opened this limited window to new foreign direct investors to come in with their investments,” Central Bank Governor Gideon Gono said during his mid-term review of monetary policy. “From September 1, 2004 up to December 2006, there will be this window which will allow them the privilege to… leave the country in the soonest possible (time) if they find the conditions of operation are not as they expected.””We will be able to pay the principal… the capital within 90 days of your telling us that you want to exit.We believe this is possible and we are putting in place measures to ensure that this redemption fund is operational,” Gono said.Gono’s mid-term review came after his maiden monetary policy statement in December last year when he announced measures to combat record-high inflation in a country rocked by a social, political and economic crisis.Zimbabwe’s annual inflation rate is among the highest in the world.It peaked at more than 600 percent at the end of 2003 but has since declined to around 395 percent in June this year.Gono said the bank was on track to achieve its target of 200 percent inflation rate by the end of the year, and announced that the timeframe for his economic turn-around plan would be brought forward from end 2008 to 2007.*Meanwhile, Acting Finance Minister Herbert Murerwa said on Monday Zimbabwe was on track to meet some 2004 fiscal targets, but warned inflation remained too high and more measures were necessary to boost foreign currency inflows.In a mid-term review of Zimbabwe’s 2004 budget, Murerwa said Zimbabwe needed to work on its foreign debt repayments and to re-engage Western donors who have suspended funding over defaults as well as policy differences with President Robert Mugabe’s government.- Nampa-AFP-Reuters”From September 1, 2004 up to December 2006, there will be this window which will allow them the privilege to… leave the country in the soonest possible (time) if they find the conditions of operation are not as they expected.””We will be able to pay the principal… the capital within 90 days of your telling us that you want to exit.We believe this is possible and we are putting in place measures to ensure that this redemption fund is operational,” Gono said.Gono’s mid-term review came after his maiden monetary policy statement in December last year when he announced measures to combat record-high inflation in a country rocked by a social, political and economic crisis.Zimbabwe’s annual inflation rate is among the highest in the world.It peaked at more than 600 percent at the end of 2003 but has since declined to around 395 percent in June this year.Gono said the bank was on track to achieve its target of 200 percent inflation rate by the end of the year, and announced that the timeframe for his economic turn-around plan would be brought forward from end 2008 to 2007.*Meanwhile, Acting Finance Minister Herbert Murerwa said on Monday Zimbabwe was on track to meet some 2004 fiscal targets, but warned inflation remained too high and more measures were necessary to boost foreign currency inflows.In a mid-term review of Zimbabwe’s 2004 budget, Murerwa said Zimbabwe needed to work on its foreign debt repayments and to re-engage Western donors who have suspended funding over defaults as well as policy differences with President Robert Mugabe’s government.- Nampa-AFP-Reuters