HARARE - The average wealth of individual Zimbabweans declined to $570 in 2013 from $630 in 2000 due to lack of ownership rights and constricted foreign direct investment, a New World Wealth (NWW) report has revealed.
Andrew Amoils, a senior analyst with NWW, a research company providing information on the global high-net-worth sector, with a special focus on Africa, Asia and the Middle East said this week.
“The average Zimbabwean remained poor while growth in wealth has been deteriorating quickly compared to other African countries.
“In 2000, Zimbabwe was in the middle of the rankings on a wealth per-capita basis, but it was the worst performer over the period ending last year, with a decline of 10 percent,” he said following NWW’s release of its Wealth Statistics in Africa report.
“Zimbabwe’s poor performance could be attributed to erosion of ownership rights, which has led to a significant loss of currency,”Amoils said.
He noted that the banning of independent media in the early 2000s “created a situation where it is impossible for investors to tell what is happening in the country”.
The study analyses wealth trends of individuals in 19 African countries between 2000 and 2013. It uses official countrywide income distribution statistics to determine the average wealth of individuals by country.
This includes people’s assets, investments and equities, but excludes the value of their primary residence.
Amoils warned that should Zimbabwe continue with its indigenisation programme, which requires foreign companies to cede 51 percent shareholding to locals, its citizens’ wealth would continue to erode.
“We have already seen people queuing up at the banks … everything fthat can go wrong has, so it is difficult to know where the country can go from here,” he said.
Zimbabwe, which was among the wealthiest African countries in 2000, ranking ahead of Nigeria, Kenya, Angola, Zambia and Ghana, experienced a deteriorating economic and social environment when president Robert Mugabe embarked on a controversial land reform exercise aimed at addressing colonial land imbalances.
However, fortunes improved in 2009 when the southern African nation adopted the US dollar as its official currency and formed a coalition government.
“But now the Movement for Democratic Change’s exclusion from government, the indigenisation programme, the lack of a free press and the threat of abandoning the dollar as official currency have raised fears that the country’s economic situation could further deteriorate,” said Amoils.
Meanwhile, the individual wealth of South Africans increased to $11 310 at the end of last year from $4 200 in 2000 on the back of stable asset ownership, a functional banking system and a free and independent media.
Ethiopians remain the poorest with assets of $260 a person last year, while Angolans have grown their wealth fastest.
Citizens of oil-rich Angola grew their wealth from $620 in 2000 to $3 890 in 2013.
In terms of growth in GDP per capita, Angola topped the list with a 737 percent gain to $5 485 between 2000 and 2012, followed by Ghana.
In individual wealth, Namibia’s growth was second to Angola’s.
However, economic growth does not necessarily translate into individual wealth.
“If one looks at countries like Ghana and others which have experienced good economic growth, personal wealth is owned by few individuals and has not filtered through to the rest,” Amoils said.
It took a while for rapid economic growth to filter through to ordinary citizens and this was the case in most African countries, he noted.