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The Zambia Chamber of Commerce Trade and Industry (ZACCI) has expressed concern at the failure by the Multilateral Investment Guarantee Agency (MIGA) to support local investors working on the same projects with the foreign investors.
MIGA is a part of the World Bank Group, with 25 industrialised and 157 developing countries as its members as of May 2020.
It is an international agency constituted to promote large scale foreign investment projects in developing countries that specialises in facilitating high-risk investments in low-income countries and supports projects that are socially, economically, and environmentally sustainable.
Zambia being among the beneficiaries, ZACCI President Chabuka Kawesha has however regretted that local investors have not benefited from MIGA.
Kawesha said it was time for MIGA to start supporting locally registered entities, not just the foreign party to ensure security and guarantees for the local partner of the project.
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He also appealed to the World Bank to ensure that Finance Corporation (IFC) opened up more instruments related to guarantees for projects because it was difficult to obtain such instruments through other financial institutions.
He said this when the World Bank Africa Group 1 Executive Director Floribert Ngaruto and his delegation paid a courtesy call on ZACCI in Lusaka on Tuesday.
“The country has mega projects in health care, pharmaceutical industry, energy, road infrastructure and these do require sustainable guarantees to ensure that the investors both local and foreign are able to structure the projects with appropriate discipline and within the framework that the IFC is able to deliver,” he said.
In response, Ngaruto said the World Bank Group would liaison with IFC management to do a diagnostic of the private sector in Zambia to open up further investments in the country.
He said the IFC management would be engaged to see how they could come in and do a diagnostic of the private sector with a view to have upstream investment initiatives.
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Ngaruto said this was meant to build the capacity of the private sector, offer technical assistance and facilitate trade.
“It is important to have a sustainable private sector development especially in terms of straightening the Small and Medium Enterprises (SMEs) to promote economic growth and reduce unemployment levels in the country,” he said.
Ngaruto said the World Bank had undertaken an initiative to increase its footprint in client countries in terms of bringing services closer to them and build capacity for regional country offices to save clients better.
Going forward, Ngaruto said, the World Bank would pay more attention to the development of the private sector to ensure a sustainable private sector development.
He commended ZACCI for the role it played in removing non-tariff barriers and reducing the cost of doing business which was a very important aspect of development that the World Bank group has been engaged in for some time.
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