Zimbabwe Infrastructure Report - 2019

1 0 Zimbabwe Infrastructure Report 2019 Zimbabwe Infrastructure Report 2019 i Zimbabwe Infrastructure Report 2019 Copyright 2019 African Development Bank Group E-mail: Cover photo: African Development Bank Rights and Permissions All rights reserved. The text and data in this publication may be reproduced as long as the source is cited. Reproduction for commercial purposes is forbidden. Legal Disclaimer The findings, interpretations and conclusions expressed in this Report are those of the author/s and are not necessarily those of the African Development Bank. In the preparation of this document, every effort has been made to offer the most current, correct and clearly expressed information possible. Nonetheless, inadvertent errors can occur, and applicable laws, rules and regulations may change. The African Development Bank makes its documentation available without warranty of any kind and accepts no responsibility for its accuracy or for any consequences of its use.

2 For more information about this Report and other information on Zimbabwe , please visit ii Zimbabwe Infrastructure Report 2019 FOREWORD Zimbabwe has faced headwinds over the last decade resulting in a collapse of the economy. However, following the political transition of November 2017, the new government requested the African Development Bank to update the 2011 Zimbabwe Infrastructure Flagship Report , so as to aid in investment planning as part of the vision 2030. The government also requested the Bank to prepare an urgent economic Report , to assist and advice on re-engagement with the international community. All these requests were to aid in the Joint Needs Assessment that was to be coordinated by the Bank, the United Nations and the World Bank. The Bank accepted these requests, cognizant of the fact that policy actions and, in particular, investment in Infrastructure have important roles to play in the development of continental trade and in promoting economic linkages within Africa.

3 The Bank recognises that poor Infrastructure is a critical barrier to accelerating growth and poverty reduction in Africa. Studies have shown that increasing the stock of Infrastructure by one percent can add up to one percent to gross domestic product. Infrastructure is considered a key component of the investment climate by reducing the costs of doing business and enabling people to access markets. It is a precondition for private sector development and a key enabler of integration of regional sub-regional markets for intra-African trade, and positioning of a competitive Africa in world markets. Investments in Infrastructure are critical to advances in agriculture and fundamental to human development, including the delivery of health and education services to poor people. Infrastructure is an enormous untapped potential for the creation of productive employment.

4 In recognition of these facts, the development of Africa s Infrastructure and economic integration are key components of the strategic direction being pursued by the Bank. In this regard, besides various normal lending and non-lending instruments offered by the Bank to its regional member countries, the AfDB leads on several key continental Infrastructure initiatives. Currently, the Bank is the Executing Agency for the Programme for Infrastructure Development in Africa (PIDA); the programme designed as successor to the NEPAD Medium to Long Term Strategic Framework (MLTSF), to develop a vision and strategic framework for the development of regional and continental Infrastructure (Energy, Transport, Information and Communication Technologies (ICT) and Trans-boundary Water Resources). The PIDA initiative is being led by the African union Commission (AUC), NEPAD Secretariat and the Bank.

5 The Bank s role as Executing Agency covers the responsibility for contractual, financial, technical and administrative management of the programme including responsibility for procurement procedures, in conformity with its existing regulations, budget management and disbursements. This Report serves four purposes by providing: (i) the Government with a master plan for rehabilitation of Infrastructure assets and recovery in Infrastructure services in Zimbabwe within the context of vision 2030; (ii) a game plan for re-engagement with the international community in the field of Infrastructure in the event that the Government moves ahead with arrears clearance in 2019 ; (iii) a platform from which a strategy for possible AfDB and other donor operations in Zimbabwe can be drawn up; and (iv) as part of the Joint Needs Assessment including costing of the Infrastructure sectors.

6 The focus of this Report is on the services associated with transport, electric power, information and communication technologies (ICT), and water and sanitation in Zimbabwe . The Report provides a detailed assessment of the current status of the Infrastructure and services in these four sectors in the country and their role within the Southern Africa region. It sets achievable objectives for Zimbabwe s Infrastructure by iii Zimbabwe Infrastructure Report 2019 2030, and lays out an action programme for achieving these objectives that includes policy and institutional reform, capital expenditure programmes for rehabilitation and new capacity, and increased resource allocations for maintenance of these facilities. It provides options for financing the proposed programme, identifies the specific areas where there is a role for private investment, and discusses improvements in the operating environment that will be required to attract this investment.

7 Kapil Kapoor Director General, Southern Africa Region African Development Bank Group iv Zimbabwe Infrastructure Report 2019 PREFACE It is now widely recognised that growth and development can only be achieved with the availability of economic and social Infrastructure . The need to improve the quality of Infrastructure services in Zimbabwe is, therefore, the cornerstone of the government of Zimbabwe s policy, strategy and programmes to promote sustained and shared economic growth in the country. This has been articulated in vision 2030 and also the recently launched Transitional Stabilisation Programme (October 2018 December 2020). In line with the government s commitment to address Infrastructure bottlenecks in the country, this publication seeks to contribute to the body of knowledge regarding this complex sector, and to assist by providing current information and analysis in order to inform and facilitate decision making.

8 This Report is important for several reasons. First, it provides the Government, the donor community and the private sector with a detailed assessment of Infrastructure investment opportunities in Zimbabwe . Second, it proposes an Action Plan to develop these opportunities, and in so doing, helps fill the gap created by the absence of master plans for the development of the four sectors. Third, it can be used to inform and support the Government s dialogue with donors and the business community about further development of these sectors. Increased coordination within this partnership can improve the alignment of investments with the national objectives, as set out in Zimbabwe s vision 2030, and regional priorities for Infrastructure development within the Southern African Development Community (SADC). In this way, the Report can contribute to the overall efficiency of the development process in Zimbabwe .

9 The preparation of the Report was based on a broad stakeholder participation and consultation. This involved numerous rounds of consultations with government officials and various key stakeholders between September and November 2018 , including a consultation workshop on 15th November 2018 , to forge a consensus on the actions to be taken and to adequately reflect them in the Report . The African Development Bank looks forward to continued dialogue, with this Report as an input, to develop bold and new approaches towards addressing Infrastructure deficiencies in Zimbabwe , within the framework of the Joint Needs Assessment. Damoni Kitabire Country Manager, Zimbabwe Country Office African Development Bank Group v Zimbabwe Infrastructure Report 2019 ACKNOWLEDGEMENTS This Infrastructure Flagship Report Update was initiated at the request of the Government of Zimbabwe . It was prepared under the supervision of Damoni Kitabire, Country Manager for Zimbabwe Office, supported by Kararach, Auma George, Lead Economist Southern Africa Region.

10 Walter Owuor Odero, Principal Country Economist for Zimbabwe coordinated and task managed the production of the Report . Front office staff of the Country Office, Utete, Petronella Shingai; Madanhire, Brighton; and Sigauke-Tito, Muriel, provided critical support while Genesis Analytics team provided consulting input. The consulting team comprised of Malcolm Pautz, Team Leader, Kim Adonis and Jennifer Mbarawa. The preparation of this Report also benefited from comments, insights and generous support of AfDB staff including those in the AfDB Macroeconomic Policy, Forecasting and Research department (ECMR); Southern Africa Regional Development and Business Delivery Office (RDGS) and within the Country Office. The leadership provided by the Ministry of Finance and Economic Development is much appreciated. The input from all the Agencies that supplied data including Government Departments, State Owned Enterprises, UN Agencies and Development Partners and private sector players is also appreciated.