By ETimes
HARARE – Zimbabwe’s investment landscape is becoming increasingly province-centric, as the Zimbabwe Investment and Development Agency (ZIDA) seeks to unlock economic potential across the nation. In its Q3 2024 report, ZIDA presents a detailed breakdown of which provinces are drawing the most investments and in which sectors. The data shows that while some regions are flourishing, others still have much room to grow. This regional competition for investment highlights key disparities in the country’s economic development trajectory.
Harare and Mashonaland West Lead the Pack
Harare, the nation’s capital, continues to dominate the investment scene, securing 83 new investment licenses with a total projected value of US$104.78 million. The city remains the central hub for both domestic and foreign investors, thanks to its relatively developed infrastructure and proximity to key government institutions. Sectors like manufacturing, ICT, and financial services are particularly active in Harare, reflecting the province’s status as a service-oriented economy.
However, Mashonaland West stands out as a province that has attracted the most capital investment, with a whopping US$393.18 million in projected investment value across 14 licenses. This is largely driven by capital-intensive industries, particularly in the mining and energy sectors. “Mashonaland West’s prominence stems from its rich mineral reserves and strategic importance to Zimbabwe’s economic plans,” the report states. The province has benefited from increased interest in mineral extraction, particularly in gold and other precious metals, which continue to draw global investment.
The Mining Boom: A National Trend
Unsurprisingly, mining remains the dominant sector across the country, accounting for 50% of the total projected investment value in Q3 2024. The sector secured 74 new licenses, with a total investment projection of US$579.9 million. This highlights Zimbabwe’s growing importance as a global mining destination. Provinces like Mashonaland West and Midlands, which are rich in mineral resources, are capitalizing on this trend. The latter received US$139.07 million in projected investments across 24 licenses, reinforcing its standing as one of Zimbabwe’s key mining hubs. While mining continues to generate significant interest, the concentration of investment in this sector also raises concerns about over-reliance on mineral extraction for economic growth. The lack of diversification, particularly in provinces that are heavily dependent on mining, could leave these regions vulnerable to commodity price fluctuations.
Energy Sector: Key to Sustainable Growth
Another sector attracting substantial interest is energy, with the report noting that US$252.8 million has been earmarked for various energy projects, particularly in provinces like Masvingo and Matabeleland North. Masvingo alone has secured US$146.71 million in new investments, largely due to the potential for renewable energy projects and infrastructure development. This is a promising development for Zimbabwe, as energy shortages remain a major bottleneck for industrial growth.
“Energy is critical for powering the country’s ambitions, especially in regions that are looking to boost their industrial output,” the report emphasizes. While mining may dominate, provinces that invest in energy infrastructure could position themselves as future industrial hubs, fostering long-term sustainable growth.
Disparities in Investment
Despite the overall positive trends, there are stark disparities in how much investment different provinces are attracting. Mashonaland Central and Matabeleland South, for instance, lag behind their counterparts. Mashonaland Central received just US$60.81 million across 14 new licenses, while Matabeleland South secured a mere US$41.93 million from 8 licenses. These provinces, which are predominantly rural, face challenges in attracting large-scale investments, especially in high-value sectors like mining and energy.
Part of the issue is a lack of infrastructure and the difficulty of accessing international markets, which makes these regions less attractive to investors. The report suggests that more focused efforts are needed to develop bankable projects in these provinces to ensure more balanced regional development.
A Need for Balanced Growth
While provinces like Harare and Mashonaland West continue to attract the lion’s share of investment, the disparities between different regions highlight the uneven distribution of economic opportunities across Zimbabwe. Mining remains the dominant force driving investment, but the concentration of capital in a single sector and a few key provinces poses a risk to long-term sustainable growth.
ZIDA’s report underscores the need for more equitable distribution of investments, particularly in underdeveloped provinces. It also points to the importance of diversifying investment beyond mining to include sectors such as energy, agriculture, and manufacturing. As the report concludes, “For Zimbabwe to achieve inclusive and sustainable growth, we must ensure that all provinces have access to the resources and opportunities needed to unlock their full economic potential”.