Harare -
Zimbabwe and South Africa signed a bilateral investment
agreement on Friday which would protect investments made by
nationals of both countries in each other's territory.
The Bilateral Investment Promotion and Protection Agreement
(BIPPA), was signed in the capital by trade ministers from both
countries.
"We want this BIPPA between our two countries to work. BIPPA is
a document signalling to the world that Zimbabwe is ready for
investments," Elton Mangoma, Zimbabwe's trade minister, said after
the signing ceremony.
In 2000, at the height of the controversial land reform
programmme in Zimbabwe, most South African businesses were affected
and lost their investments.
The agreement means that South African-owned businesses will be
protected with effect from September last year when the Global
Political Agreement was signed.
Under that deal brokered by former South African president Thabo
Mbeki, long time rivals President Robert Mugabe and opposition
leader Morgan Tsvangirai agreed to share power in Zimbabwe.
Tsvangirai became prime minister.
Mangoma said Zimbabwe was working hard to improve its investment
climate and assured South Africans and other countries that their
businesses will not be affected by the state's controversial
empowerment law, which requires that locals own a 51 percent stake
in all foreign firms.
"When we look at our empowerment law, we are not looking at
charity cases, not looking at corruption cases," the minister said.
Since independence in 1980, Zimbabwe had been the strongest
economy in the region over the years, but over the past decade its
economy has shrunk as a result of political and economic
uncertainty.
In 2008, Zimbabwe was South Africa's second biggest trading
partner in the region after Zambia, with investments ranging from
banking, retail and mining to farming and transport.
Rob Davies, South Africa's trade minister said Pretoria was
ready to support Zimbabwe, but warned that there was a need to
address the issues related to the GPA.
"Our position is informed to a very great extent, by our
conviction that the Global Political Agreement process is the best
and it is the only option for Zimbabweans to come together for
recovery in this country," he said.
"Our support for the implementation of the GPA process is also
based on the strong sense that is also critical to our own interest
as South Africa."
Businesses boycott agreement
However,
Business Unity South Africa has
refused to take part in the signing ceremony.
The reason, the organisation says, is that it has not been consulted
about its contents, and the reported content of the agreement has rung alarm
bells for some members.
"For such a treaty to act as a catalyst for increased levels of
investment, the private sector needs to be comfortable with all aspects of
the text," Busa said in a statement on Thursday. "We do not yet have full
information about the scope of the agreement and it is these uncertainties
that are particularly worrisome for the business community."
It added that when the text of the agreement becomes publicly available
then Busa would be in a position to issue a more detailed assessment of its
business implications, especially for South African investors in Zimbabwe.
Busa also hopes that there will be a transparent and robust debate around
the issues as part of the Parliamentary processes before the agreement is
ratified.
- Sapa-AFP