Government to review indigenisation laws: Obert Mpofu
Zimbabwe Mines Minister Obert Mpofu on Friday said government will review laws compelling foreign-owned firms to transfer majority shareholding to indigenous Zimbabweans, in a bid to attract much needed investment.
The southern African country’s indigenisation laws restrict foreign companies to a maximum of 49 percent stake of a business with the remainder reserved for Zimbabweans.
The government is also entitled to a free 25 percent shareholding in precious minerals such as gold, diamond and platinum, and strategic minerals such as coal and coal-bed methane.
The controversial indigenisation laws have sent jitters among foreign investors with some scaling down operations or withdrawing from Zimbabwe completely as the country’s economy suffered under a decade-long recession.
Zimbabwe is now under a coalition government formed in February between former political rivals President Robert Mugabe and Prime Minister Morgan Tsvangirai.
The Harare administration has said it requires US$10bn to revive the collapsed economy and attracting foreign investment is vital to raise production as Zimbabwe tries to recover.
Mpofu told an investment conference in Harare that the review would lead to legislation more focused on investment.
“Careful consideration will be taken to ensure that the process of indigenisation is not at the expense of the much needed direct foreign investment,” he said.
“We are back to the drawing board at stakeholder consultation stage where submissions of all the views of interested parties are now being sought again in order to address all the concerns.”
Zimbabwe has launched a review of all mining contracts, saying it would introduce a “use it or lose it” policy.
“In doing so we want to ensure that all those that are performing will not be prejudiced,” said Mpofu. “We are doing it in a manner that will not frighten people away.”
With the agriculture sector in turmoil, mainly as a result of Mugabe’s government’s seizures of farms from whites, mining had become the largest employer and earned more than half of the country’s foreign currency. – ZimOnline