|March 21, 2011
Bilateral investment agreement signed with Zimbabwe
Zimbabwe and Botswana signed the Bilateral Investment Protection and Promotion Agreement (Bippa) paving way for the unlocking of $70 million lines for credit. Botswana had set the agreement as a pre-condition for Zimbabwe to access lines of credit from the neighbouring country. Bippa is an agreement establishing the terms and conditions for private investment by nationals and companies from countries involved.
Speaking at the signing ceremony in Harare, Economic Planning and Investment Promotion minister, Tapiwa Mashakada, said the move served to cement the cordial relations between the two countries. “The two countries have had fruitful trade relations. This will serve to boost interest from other quotas and the country will most likely see an influx of investment based on the fact that Botswana as the most stable African country has expressed confidence in Zimbabwe,” said Mashakada. He said the lines of credit should boost capacity utilisation in the medium term in the manufacturing sector from the current average of 53% to about 80%.
The funds would mainly be availed to the country’s manufacturing sector that is in desperate need of recapitalisation. He said negotiations were at an advanced stage to sign Bippa’s with several other countries in the region and beyond including with Zambia, Namibia, South Korea, India and the Democratic Republic of Congo. Finance minister Tendai Biti said the country would follow up pledges by the South Africa of R500 million lines of credit and was in the process of negotiating for the revival of an Export Credit Insurance Corporation Facility valued to the tune of R$2,5 billion.