Zim forex crisis poses quandary for SA firms

Since his rise to power nearly 14 months ago, Zimbabwean President Emmerson Mnangagwa has anchored his rule on the mantra "Zimbabwe is open for business". But this is just half of the reality for the country's businesses; there are investment opportunities but there are also risks. Mnangagwa has chosen to focus on the former. This week he travels to the World Economic Forum in Davos, Switzerland, to try to persuade the global business elite to invest in the country. But foreign-owned companies are struggling to repatriate their earnings. A persistent foreign-currency shortage, which shows no signs of easing, is the latest challenge. Estimates put Zimbabwe's foreign-currency reserves at only a two-week cover, far less than the World Bank's recommended three to four months cover. Staring down the barrel of this gun are South African-owned companies and state-owned enterprises (SOEs) doing business in Zimbabwe. Because they are invested across many economic sectors, South African compa...