Minister Slams Companies Act, Says It Is Out Of Date And Needs Overhaul

Minister of Justice, Legal and Parliamentary Affairs Ziyambi Ziyambi, has said that there is need to overhaul the Companies in order to improve the ease of doing business in the country. He said, the Companies Act which was passed in 1951 was out of date and blamed it for stalling investment as well as increasing corruption. Speaking at a workshop to review the Draft Companies and Other Business Entities Amendment Bill, the Minister said,

Clearly, the country’s regulatory framework has not been conducive and the results and dire ramifications are there for everyone to see.

Ranked 159 out of 190 economies on the Ease of Doing Business Index according to the latest World Bank annual ratings, the new political dispensation has an unenviable task of convincing the world that the country is indeed open for business.

It goes without saying that when systems, processes, rules and regulations are business-friendly, setting up of businesses is made easier not just for big companies but also smaller ones that have less capital at their disposal.

…with small and medium enterprises, more red tape can often result in obstacles that ultimately prevent them from moving ahead with their business in a timely manner or discourage individuals from pursuing businesses in their local economies.

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In addition to the above, transaction costs form a major part of setting up shop for small and medium-sized businesses

In Zimbabwe, the opaque and restrictive regulatory framework for setting up and even operating a business, discouraged foreign direct investments, limited opportunities to economic opportunities and stimulated corruption.

More: Daily News