WestProp says inconsistent currency frameworks dampens Zim’s investor interest
Business Reporter
PROPERTY market game changer firm, WestProp Holdings Limited has called for urgent clarity and consistency on currency and exchange rate frameworks.
The outcry comes on the back of indications by the central bank that the country will go full swing mono currency by 2030.
While assuring the banking public that the transition will be flawless and smooth, the Reserve Bank of Zimbabwe (RBZ) has not clarified the finer details of the policy shift, effectively pressing the panic button across the country’s key economic sectors.
To this end, players involved in long term projects have reported limited access to financing as lenders are now skeptical on how the mono-currency agenda will play out.
Speaking to over 300 property developers, pension fund executives and other key stakeholder at Zimreal Property Conference held recently, WestProp Holdings Limited chairman, Dr Michael Louis called for honest conversations for the government to hear their concerns.
“The cost of bureaucracy, infrastructure bottlenecks, and the lack of policy consistency especially around currency and exchange rate frameworks is not sustainable for the industry and continues to dampen investor confidence. If we are serious about growth, these matters cannot be left at the fringes of policy. They must become core agenda items. We cannot talk of “cementing growth “when the foundations are shifting beneath our feet,” he said.
He said stable currency policy, consistent land administration and predictable legal frameworks must not be ambitious- they must be the norm.
Ken Sharpe, CEO of Westprop Holdings opened the conference with some stark realities that the real estate market in Zimbabwe is only 2% of the country GDP while the average in Africa is 12% and international average is 20%.
More concerning, he said , is that the mortgage rate contribution by the state in Zimbabwe is only 0,04%.
He conveyed that meaningful growth could not be attained without unlocking capital and that mortgages and long term finances are the arteries of a functional property market.
“Without these we build, but do not grow. The absence or inaccessibility of such instruments constrains not only developers, but also the dreams of everyday Zimbabweans who seek to own a home, a shop or a piece of land.
“There is no danger or harm for Government to announce that a multi-currency regime will be permanent and run alongside the local currency thus giving the confidence to investors and bankers that fear the USD will be outlawed as during previous dispensations,” Sharpe said.
