Old Mutual Keeping an Eye on Zimbabwe Market

January 14 - Old Mutual is willing to further commit to expansion into Zimbabwe's insurance and financial markets, as long as it sees the government put in place a more supportive policy.

This is according to Old Mutual South Africa's Chief Executive Officer, Kuseni Dlamini, who said that the group was keeping an eye on Zimbabwe's market.

"We are watching it very closely," he said. "The challenge that is facing Zimbabwe is ensuring there is a conducive environment to invest. We need business friendly policies."

Old Mutual has a strong foothold in the Southern African country already, controlling much of the market capitalization on the Zimbabwe Stock Exchange.

OM holds a 100% interest in CABS, Zimbabwe's largest building society.

However, Dlamini made it clear that no further investments would be made until the government changed its current policies.

"We are looking for signals that are going to give us confidence and comfort that there is a very clear and unequivocal commitment to prudent microeconomic policies that are going to make it worthwhile for us to invest our shareholders' money in that country," said the CEO.

Despite the fact that there are clear signs of recovery in Zimbabwe's economy following the creation of a coalition government, investors are still jittery about a number of policies that are still in place.

The most problematic policy facing investors is that foreign owned groups need to localize at least 51% of their shareholding.

Robert Mugabe's constant threats to seize foreign companies is also seen as a significant problem.