20 Mar

Moti Doubles Zimbabwe Investments as Economy Seen Opening Up

Moti Group is preparing to double its investments in Zimbabwe to $500 million after the removal of Robert Mugabe as president in November saw the government adopt a more open approach to foreign companies.

Emmerson Mnangagwa, 75, who replaced Mugabe after the military briefly took control, has declared that “Zimbabwe is open for business” and has said he will ease the country’s local ownership rules and re-engage lenders such as the International Monetary Fund.

He is faced with an economy that has halved in size since 2000, a cash crisis that limits withdrawals from banks and an inability to pay government workers on time.

In partnership with Sakunda Holdings, a Zimbabwean company whose head Kudakwashe Tagwirei is linked to the ruling party, Johannesburg-based Moti plans to spend $250 million over the next four years in projects ranging from chrome-ore mining to fertilizer, diamond polishing and pharmaceuticals. The group has already invested about $250 million to date, mainly in mining.

The company wants to invest before elections scheduled for later this year after which more investors may come into the country and cause asset prices to rise, Zunaid Moti, the company’s 43-year-old chairman, said in an interview. The plans would make Moti one of the biggest investors in Zimbabwe.

“This is yesterday, that’s tomorrow,” Moti said, as he smoked a cigar in his Johannesburg office and compared mining potential in his home base of South Africa to that of Zimbabwe. “It’s virgin.”

Moti Group has also been approached by private-equity firm Carlyle Group to look at investment opportunities in the southern African country, he said. Carlyle declined to comment.

Moti Group has recently taken on British politician Peter Hain as an adviser to connect the company to “the right people in Europe, and more specifically in the U.K. when needed,” said Moti, who is considering selling as much as 25 percent of his business to selected investors at a later stage.

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