Corruption Imposing Premium On Investment
MUTARE-Corruption has cost Zimbabwe over $50 billion dollars since attainment of independence by imposing a premium on investment, a top economist has said.
By Donald Nyarota
Prosper Chitambara of the Labour and Economic Research Institute of Zimbabwe said corruption is thriving due to weak national institutions which are guided by political expediency.
He said officials align and seek favour with political masters at the detriment of economic fundamentals, which has an effect of increasing the cost of doing business.
“Corruption thrives in an environment where there are weak institutions, so corruption is thriving here because we have weak institutions which are guided by political expediency.
“Political expediency must never override rationale, when it does it entrenches corruption and in our case, corruption alone imposes a 20 percent premium doing business.
“Conservatively Zimbabwe has lost over $50 billion since 1980 to 2013 according to independent research that has been carried out and this is a telling figure given that we have failed to promote sustainable development,” said Chitambara.
Chitambara said knee jerk reactions by politicians have created a toxic environment for investors who shun inconsistencies of politically motivated policy pronouncements.
He said government should promulgate policies which promote the ease of doing business, as well as directing national spending towards key enablers of production.
“To break from this cycle of chronic hyperinflation we should take deliberate steps to enhancing production by investing in key enablers like energy.
“Government should invest in infrastructure to unlock development potential, so there should be an up-scaling of investments in roads and energy which are key enablers to production,” said Chitambara.
He added, “Policy instability and inconsistency over the last six months are some of the issue which spook investment because they affect the outlook and also because of the macro economic instability, also affect investor confidence.”