Multinational financial services group Standard Chartered says it remains committed to Zimbabwe despite the turbulent macro-economic environment that has witnessed two major currency crises within 20 years.
This comes as some large multinationals, experts and think tanks have repeatedly warned Zimbabwe is an unsafe investment destination due to a volatile macro-economic environment, corruption and policy inconsistencies.
The financial services sector has not been spared with a number of bank closures due to mismanagement and gross malpractices in the past twenty years, putting a huge dent on confidence among consumers.
Lending has become risky as the local dollar continues to slide against the US dollar.
Mohamed Abdel Razek, regional chief information officer, Africa and the Middle East and Islamic Banking said the bank has a long history with the southern African country and is committed to remaining operational in the territory into the future.
“At Standard Chartered, we have a long-standing history in Zimbabwe, having operated in the market for 127 years,” Razek told Business Times in emailed responses.
“We will continue to maintain this commitment moving forward and remain dedicated to the long-term interests of our staff and customers in Zimbabwe.”
The Standard Chartered executive also said the bank will also continue to support the development and growth of Zimbabwe’s economy through various initiatives and programmes.
“In fact, we recently introduced our ‘Futuremakers’ programme to Zimbabwe to provide the country’s youth with valuable opportunities.
“What’s more, we partnered with a local institution, Junior Achievement Zimbabwe, to aid in the programme’s rollout,” Razek said.
“Through our increased presence in Zimbabwe, we aim to promote increased financial inclusion, a key priority in the nation’s agenda.”
Standard Chartered’s commitment to Zimbabwe comes after the turbulent macroeconomic environment is proving untenable to business with both domestic and foreign investors now forced to seriously re-look their position in the southern African country.
Foreign currency shortages worsened, forcing some businesses to pay huge premiums on the black market and the local currency has been on a slippery slope since its formal introduction with the interbank system.
Rising inflation, cash shortages, power shortages, dwindling disposable income among consumers, a huge exchange risk coupled with a growing political risk have been among the major challenges for business in 2019.
As a result, businesses like low-cost carrier fastjet Plc and South Africa’s Pepkor have just had enough and are contemplating leaving Zimbabwe.
As previously reported by Business Times, Pepkor late 2019 said a decision was made to exit operations in Zimbabwe as a result of the continued macroeconomic challenges in the country and on-going devaluation of the local currency.