ZIMBABWE 2010 BFIF PROJECT PROPOSAL

UNCLAS SECTION 01 OF 02 HARARE 000045

SIPDIS

DEPT FOR EEB/CBA - DENNIS A. WINSTEAD

E.O. 12958: N/A
TAGS: BEXP ECON EINV ETRD ZI
SUBJECT: ZIMBABWE 2010 BFIF PROJECT PROPOSAL

REF: STATE 126674

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SUMMARY
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1. Embassy Harare proposes three projects to be supported by the
Business Facilitation Incentive Fund (BFIF). The total amount of
BFIF support requested is $15,000.


2. The common theme of the projects is transparency and good
governance. Zimbabwe is once again open for business after several
years of sharp macroeconomic decline, hyperinflation, and acute
political uncertainty. But the business climate remains difficult
and is the main constraint on opportunities for American firms. In
the World Bank's latest "Doing Business" report, Zimbabwe ranked
28th in Africa, well behind South Africa, Botswana, and Namibia,
which were second, third, and fourth, respectively. More than ever,
Zimbabwe's economic fortunes and opportunities for American
businesses now depend on restoring confidence, especially with
respect to transparency and governance. All three projects
presented below will be implemented by the American Business
Association of Zimbabwe (ABAZ),which achieved notable success with
BFIF support in previous years. END SUMMARY.

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EITI Policy Dialog
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3. Lack of transparency and poor governance in Zimbabwe's mining
sector have featured in local headlines in recent years and also
attracted international attention. Improving standards of
governance is essential to attracting vital investment to Zimbabwe's
mining industry and creating opportunities for American businesses.
In recent months, local business leaders and industry experts have
begun efforts to gain Zimbabwe's participation in the Extractive
Industries Transparency Initiative (EITI). Turning this effort into
a productive dialog can create more opportunities for U.S. exports
to Zimbabwe.


4. To bring momentum to this incipient effort, ABAZ intends to
organize an EITI Policy Dialog that would bring together GOZ
policymakers and local business leaders. So far, the GOZ has
expressed openness to EITI in principle but taken no action. The
proposed BFIF-supported EITI Policy Dialog will allow ABAZ to put
this subject on the public agenda. ABAZ would use $2,500 in BFIF
support to cover the cost of hiring a venue and preparing briefing
materials for this one-day event.

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"Just Business" 2010
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5. ABAZ organized an annual "Just Business" forum from 2006 through
2008, but the unsettled circumstances of early 2009 made it
impossible to plan a forum for that year. The successes of previous
"Just Business" events and changes in Zimbabwe's economic
circumstances have led to strong demand among ABAZ members and other
participants to resume the series.


6. The 2010 "Just Business" forum will expand the usual one-day
schedule to two. ABAZ has chosen the theme, "Creating Investor
Confidence through Governance and Transparency." In addition to
inviting business leaders to address the forum, this year's event
will also include workshop sessions aimed at producing an action
agenda for improving Zimbabwe's business climate. The workshops
will prioritize the challenges in Zimbabwe's business climate and
propose an agenda for action. A specific aim of the workshops will
be to identify actions the GOZ and Zimbabwe's business associations
can take to improve the country's ranking in the World Bank's "Doing
Business" rankings.


7. The level of BFIF support needed for the "Just Business" forum is
$10,000. Half of this amount would be used to cover the cost of the
venue and refreshments. A further $3,000 will pay for pre-event
Qvenue and refreshments. A further $3,000 will pay for pre-event
publicity and communications, and $2,000 will be used for media
coverage and publications. ABAZ aims to raise at least $75,000 in
contributions from other sources to cover the balance of the costs
for the event.

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Reviving the ABAZ Website
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8. Past "Just Business" events have sparked continuing debate on
economic policy issues and the challenges of doing business in
Zimbabwe. For this year's event, ABAZ members want to put renewed
effort into continuing advocacy for transparency and good
governance. The ABAZ website is an ideal tool for this purpose, but
it has not been operational since late 2008, due to the chaos
induced by hyperinflation. The full cost of reviving the ABAZ

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website is estimated to be $5,000, of which $2,500 will be BFIF
support for re-design of the website.


9. Post's top priority among these three projects is the "Just
Business" forum, which is tentatively planned for late August. If
funded, the EITI Policy Dialog would take place in March. Work on
the ABAZ website would commence once funding is available. Post's
point of contact is EconOff James Garry (garryjc@state.gov).

RAY