Zimbabwe recorded $166 million of foreign direct investment (FDI) inflows in 2021 against inflows of $194 million in 2020, according to the 2022 edition of the United Nations Conference on Trade and Development’s (UNCTAD) World Investment Report.
Experts attribute a lack of investment to a lack of investor confidence, largely emanating from the government’s policy inconsistencies. Also, the coronavirus pandemic made it difficult for already stressed investors to splash their money as the environment could not favor it.
Despite a 14% fall in FDI inflows, the government is committed to prioritizing the agriculture and mining sectors and has amended investment laws to encourage investment to develop both of these priority sectors.
In 2019, FDI inflows into Zimbabwe stood at $280 million. On the back of a small number of approved projects, Zimbabwe’s FDI inflows more than doubled to $745 million in 2018 from $349 million in 2017.
FDI to one of Zimbabwe’s biggest trading partners, South Africa, increased to $40.88 billion from $3.06 billion in 2020. “The strong increase was due primarily to a large corporate reconfiguration in South Africa – a share exchange between Naspers and Prosus in the third quarter of 2021,” stated UNCTAD.
FDI to Southern Africa nearly tripled to $42 billion during the period under consideration.
Investment flows to Zambia, on the other hand, were negative at -$457 million, down sharply from -$173 million in 2020. The reduction was related to a $1.5 billion copper mine divestiture by Swiss firm Glencore to state-owned ZCCM Investments Holdings, according to UNCTAD.
Meanwhile, for the second consecutive session equities trading at the Zimbabwe Stock Exchange (ZSE) maintained downward trend as the ZSE All Share Index closed 1.43% weaker to finish at 23,790.71 points on Wednesday.
Investors lost ZWL$42.15 billion as the market capitalization settled at ZWL$2.96 trillion. Market breadth closed negative as 22 counters lost relative to 6 gainers.
The Top 10 Index suffered the most as it succumbed 1.70% to 15,328.84 points. Ecocash lost 4.72% to close at ZWL$117.83.
Bucking the trend was CBZ which garnered 2.17% to settle at ZWL$117.50.
The Medium Cap Index retreated 0.72% to close at 42,560.78 points. ZBFH eased 5.33% to finish at ZWL$71.00. Construction firm Masimba fell 5.18% to end at ZWL$61.00. Clothing retailer Edgars was off 4.38% to close at ZWL$4.40.
Gains were recorded in FMP, Mash Holdings and African Sun which gained 11.10%, 0.80% and 0.32% to close at ZWL$11.00, ZWL$6.24 and ZWL$24.00 respectively.
Fidelity Life gained 3% to become the best performing stock. As a result the Small Cap Index recovered 0.50% to close at 480,838.01 points.
From the rear of the chart clothing retailer Truworths topped the losers set after falling 8.23% to ZWL$2.20.
Turnover declined from yesterday’s ZWL$628.43 million to ZWL$353.13 million in 356 trades.
With regards to the value of traded stocks, Econet took the lead of the top 5 performers, flanked by FBC, Delta, Simbisa and Ecocash.
On ETFs, the Datvest gained 0.83% to close at $2.3687 but the Morgan & Co Multi-Sector eased 4.71% to finish at $24.4698. The OM ZSE Top-10 lost 0.01% to settle at $11.4783 – Harare