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Govt moots localising foreign companies

Itai Mushekwe

A SENIOR civil servant this week revealed that government was working on legislation that would compel all foreign-owned companies to cede half their stake

s to indigenous people.

Threats of forced disposal of key stakes for indigenisation have in the past only been directed at the mining sector, whose ownership structure is dominated by foreign firms.

But there have been muffled suggestions among ruling Zanu PF hawks that most major economic players, particularly banks like Standard Chartered and Stanbic Bank, which are wholly foreign-owned, should be targeted under the indigenisation programme.

Ozias Hove, the permanent secretary in the Ministry of Indigenisation and Empowerment, said government would broaden the empowerment requirements to include all economic sectors.

“I want to take this opportunity to inform you that the proposed National Indigenisation and Empowerment Bill that seeks to legislate for all indigenisation and empowerment programmes is now in its final legal drafting stage at the Attorney-General’s office,” Hove said during the presentation of $40 million to the National Investment Trust by the National Social Security Authority on Wednesday.

He said indigenisation and empowerment would “basically endeavour to change the status of black Zimbabweans by providing access to, control and optimal utiulisation of economic resources”.

“In fact, the policy provision is that indigenous people shall control at least 50% shareholding in all sectors of the economy. For this objective to be realised…government has made it policy that a significant share of equity and business in all sectors of the economy is in the hands of indigenous people,” Hove said.

He said the country would not develop at the mercy “of foreign interests” and that economic nationalism was “the hallmark of all sovereign nations”.

The move is unlikely to receive backing from foreign investors, targeted by government under its economic turn-around programme, and will likely cause further economic shrinkage in the investment-strapped country.

“That’s not a clever idea,” said independent economic consultant, John Robertson. “Government appears to think that a company is a collection of assets and if someone else owns half the assets the company will continue to work. We’ve seen that happening with the land reform programme.”

Hove lashed out at Zimbabweans opposing government’s indigenisation thrust, saying such people had denounced “their own identity, their own country and indeed the national interest while pandering to foreign imperialist interests”.

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