Despite Zimbabwean opposition leader Morgan Tsvangirai joining the government of national unity last week and the government changing policy to allow businesses to charge in foreign currencies, local retailers are not leaping to be the first back into the country that was once known as Africa's bread basket.
A retail analyst said South African businesses were waiting to see whether the latest development would herald real change before returning. South African businesses wrote off their Zimbabwean investments some time ago and do not account for any earnings from the country, which has the world's highest inflation.
The country is also in the middle of a humanitarian crisis.
The World Health Organisation has put the number of cholera deaths at more than 3000 while about 7-million Zimbabweans need food aid, up from 5,1-million six months ago, according to the World Food Programme.
The analyst said Zimbabwe would have to receive US President Barak Obama's “seal of approval” before companies expressed an interest in moving back into the country. He said aid from the US and Europe would be required to provide Zimbabweans with sufficient spending power to create a market.
Massmart group corporate affairs executive Brian Leroni said the company was “cautiously optimistic about the renewed potential for a lasting political settlement in Zimbabwe”. But the company did not see its policy towards its assets there changing in the short term.
Massmart held in effect an 85% interest in Makro Zimbabwe, but this had been written off and did not contribute any profit or dividends. The group has two stores in Zimbabwe.
Two years ago, CEO Grant Pattison said Massmart would retain its stake for as long as possible to enable it to “keep the door open”. In 2007 he said the business, although worth nothing in South African currency, was sustainable in Zimbabwean terms and the balance of the subsidiary was held by a Zimbabwean investor.
Adrian Naude, head of Pick n Pay group enterprises, said the company had a 25% stake in TM Supermarkets, which it had held for some time.
The food retailer hoped that “the situation will resolve itself speedily so that our associate can operate successfully”.
Tiger Brands said its position regarding its assets in Zimbabwe remained unchanged and Shoprite was not commenting publicly on its assets there until Zimbabwe's internal problems had been fully solved. Shoprite has one store in Bulawayo.
Tiger Brands holds a 26% interest in National Food Holdings, a company listed on the Zimbabwean Stock Exchange.
Source: Business Day
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