The evolution of public and private investment in Zimbabwe

Abstract

This paper aims to put the spotlight on the evolution of both public and private investment in Zimbabwe, as they responded to the economic policies implemented from 1965 through to 2011. With the adopted inward-looking policy in 1965, the massive core of infrastructural growth in public investment became a catalyst to the high level of private investment growth. The perpetuated market-intervention policy in 1980 later resulted in the growth of public investment. Despite the adoption of a market economy in the 1990s, the envisaged cut in public investment did not occur. Very few State enterprises had been privatised by the year 2000; and there was a reversal to the market-intervention strategy during the period 2000 to 2011. Notwithstanding the government’s efforts to boost both private and public investment in Zimbabwe, the country still faces a number of challenges, as do many other African countries. These challenges include, amongst others: (i) The high national debt overhang; ii) low business confidence; (iv) liquidity constraints; (v) low industrial competitiveness; and (vi) an inadequate infrastructure.