European investments in Africa and worldwide will hinge on crucial principles such as sound governance, an independent judicial system, and respect for property rights, according to a senior diplomat who addressed reporters earlier this week.
Following his participation in the SADC-EU Ministerial Meeting in Harare earlier this week, Poland’s Foreign Affairs Minister, Radosław Sikorski, addressed the press. He emphasized that controlling inflation, protecting investors' rights, and adopting a versatile taxation system, along with several other elements, could significantly boost economic development.
Poland is currently leading the EU Council presidency.
The diplomat also mentioned that Poland, having regained its sovereignty from Russia in 1918, has gone through periods of extreme inflation akin to what was seen in Zimbabwe.
"We also experienced hyperinflation towards the end of the communist period. In 1989, which marked the final year under communism, our inflation rate reached nearly 1,000%. It dropped slightly in the next year to around 800%, but since then, we've become one of the quickest growing economies within the European Union with the least joblessness," he stated.
“The recipe for economic success is a very old one: peace, easy taxes, and the proper administration of justice. The best way to attract foreign investment is to treat your investors well. If you print too much currency, you will get inflation. So, you need to live within your means and balance the books. That is a universally applicable lesson.”
At the gathering, Sikorski mentioned that numerous accords amounting to more than €160 million were finalized, spanning multiple sectors beneficial to both sides. "A joint declaration encompassing 34 points related to matters involving SADC and the European Union along with global topics was reached," he stated. "Moreover, several pacts—in my recollection, about eight—amounted to an aggregate sum exceeding €160 million," Sikorski elaborated.
We were keen on revitalizing the discussions regarding the Partnership Agreement between the EU and SADC. The European Union is backing your initiatives. We have moved beyond colonial or post-colonial mindsets.
He stated, "Our aim is to support your endeavors as per your wishes. The integration of economies within African nations is something they themselves aspire towards; it is the African countries that desire these infrastructure and transport networks."
Nevertheless, part of our support hinges on specific principles since we hold the belief that robust governance forms the bedrock for economic progress. In order for enterprises to thrive, they require the ability to uphold contractual agreements. Enforcing these contracts necessitates a capable and impartial judicial system. Lacking this, both local individuals and international investors may refrain from investing.
The remarks from the diplomat follow the launch of the €300 billion EU Global Gateway program in 2021. This initiative seeks to enhance intelligent, sustainable, and resilient links in areas such as digital technology, energy, and transportation. Additionally, it aims to reinforce healthcare, educational institutions, and research capabilities across the globe.
He stated that the EU was utilizing the Global Gateway initiative to strengthen relationships with allies worldwide, grounded in the "competitiveness" of this approach.
"What we provide is highly competitive. Our organization comprises member states that adhere to democratic principles. We hold the belief that upholding the rule of law yields superior outcomes compared to pursuing short-term political gains. However, this remains your decision," Sikorski pointed out.
At the same press briefing, EU Ambassador to Zimbabwe, Jobst von Kirchmann, emphasized that resolving Zimbabwe’s $21.7 billion debt could improve the nation's opportunities for maximizing benefits under the Global Gateway initiative, potentially enabling access to new loans from international financiers.
He stated: "The Global Gateway Fund is entirely unrelated to any restrictions. Nevertheless, constraints regarding the utilization of Global Gateway funds are connected to the issue that Zimbabwe owes $21.7 billion in arrears and debts."
I consistently praise the initiative taken by His Excellency the President to address outstanding debts and financial obligations via the arrears clearance platform. We fully endorse this approach and are prepared to keep supporting Zimbabwe’s efforts towards achieving this goal, as it will pave the way for government financing.
In 2022, Zimbabwe, which had its EU sanctions from 2002 significantly relaxed, initiated a debt clearance initiative spearheaded by the African Development Bank.
International lenders such as the European Union have stressed that it is essential for the nation to carry out important restructuring measures to address its considerable debt burden.
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