The number of new investment licences issued rose by 12.5% in the third quarter, the Zimbabwe Investment Development Agency (ZIDA) says, despite concerns that the election period would slow down applications.
CEO Tafadzwa Chinamo says ZIDA issued 180 new licences in the third quarter of 2023. These applications are for projects with an expected investment value of $3.4 billion. A total of 126 licences were renewed in the quarter, and these have a value of US$207.5 million. This figure, Chinamo says, is of actual investments verified by ZIDA inspectors during licence renewal.
“There were worries obviously that with the elections there might be a slowdown in investments, but as you see from the numbers from the quarter – and August is bang in the middle of the third quarter – we didn’t see much of a slowdown,” said Chinamo. “The number of licences that we issued in the third quarter is higher than in the previous two quarters.”
Where is the new investment heading?
ZIDA’s numbers over the year show that investment is still skewed towards extractives, beating manufacturing and services.
By value, energy had the biggest share of the applications in Q3. Licences for projects worth US$3.4 billion were issued in the quarter. Of these, US$2.8 billion will be in energy. However, the biggest of these projects is not exactly “new”. It is the New Eagle Industrial Park, an ambitious US$2.3 billion battery metals project that lithium developers announced last year for Mapinga.
Another licence went to SunOne, which plans to build three solar plants in Mazowe, Manhize and Matobo, a combined 500MW for US$497 million.
Mining saw 86 new licences for projects, valued at US$412 million, up from 66 licences in Q2, which were for US$208 million. Licences for manufacturing went up from 29 in Q2 to 46 in Q3. Services licences were down from 48 to 26, but the projected value was higher, from US$43 million in Q2 to US$61 million in Q3.
China still rules
China is the biggest investor in Zimbabwe by a wide margin. Of the 180 new licences issued, 121 went to Chinese companies. The proposed Chinese investments have an estimated value of US$2.8 billion. There were 10 licences issued to locals, valued at US$33 million. Local investment is, however, higher as many locals do not register with ZIDA.
There were five new investors from the UAE, with projects of a combined US$498.5 million.
ZIDA helps investors to set up in Zimbabwe by handholding them through processes such as company registration and ZIMRA compliance.
“At the end of last year, it was taking an investor upwards of 21 days to get a ZIDA licence. We are down to two days on that,” Chinamo says. The next phase, he said, is to enable prospective investors to start and finish the process online.