18 March 2024‘SOEs can be salvaged under Mutapa’HARARE –...

18 March 2024

‘SOEs can be salvaged under Mutapa’

HARARE – State-owned Enterprises and parastatals put under the direct control of Mutapa Investment Fund are set to bounce back to profitability, or maintain profitability and build up the investment assets that belong to the people.

Several State-owned enterprises that have been struggling were brought together, along with some already profitable enterprises, and are now being run under the Sovereign Wealth Fund as part of the Government effort to convert them into viable companies.

Economic experts hailed the Government’s move to bring these together under the direct control of Mutapa.

In an interview yesterday, economist Mr Eddie Cross said the Government intention to move majority of non-performing State assets across to Mutapa Investment Fund was ideal because now they will be run by a professional board and directors and a chief executive as businesses.

“This would reduce the extent of political interference where these organisations are managed and hopefully return to profitability in the medium term,” he said.“

I think this is a great idea as these agencies have massive assets which are under performing and which if their organisation turned around will in fact strengthen the overall balance sheet of the State.

”The divestiture of RBZ companies, which have also been moved into Mutapa leaving the RBZ with its core central banking and regulation functions, dovetails with the IMF Article Consultation mission that also recommended that in order to deal with the RBZ quasi-fiscal operations, RBZ should divest from all its subsidiaries and transfer them to Government. The Mutapa Investment Fund was a major upgrade and renaming done in September last year of the original 2014 Sovereign Wealth Fund. This upgrade saw the transfer of Government shareholdings in a block of State-owned entities and former parastatals to the fund along with other Government investments.

Such sovereign wealth funds are used in several countries to build up a portfolio of investments for the benefit of the people and at times have been used to ensure that any sudden temporary bursts of wealth, such as an oil strike, result in investments that will continue to provide national income when that resource is exhausted.

In Statutory Instrument 51 gazetted last week, President Mnangagwa added the State shareholding in seven companies to the list of assets of the Mutapa Investment Fund.


https://www.thezimbabwemail.com/business/soes-can-be-salvaged-under-mutapa/