ANGLO American, the world’s second biggest mining corporation, said yesterday it was contesting the Zimbabwe government’s plans to expropriate Mkwasine Estate, a sugar and wheat project owned by
the South African listed group.
Mkwasine Estate, a joint venture between Anglo and the Tongaat-Hulett Group, was issued with a Section 8 order on July 23. Anglo controls 53% of the sugar estate whose acquisition notice expired this week. The order had given management and staff 90 days to wind up operations and vacate the property.
Anglo chairman in Zimbabwe Godfrey Gomwe said the corporation had engaged government in negotiations.
“Hippo Valley Estates remains listed under Section 5 but representations with the relevant authorities to secure a delisting of both properties (Hippo and Mkwasine) are ongoing,” Gomwe said. Anglo was taking appropriate legal action to prevent the government from acquiring its properties. He did not elaborate.
No comment on the matter was available from Tongaat.
Mkwasine, which at the moment has 4 600 hectares under sugarcane, produces between 475 000 and 500 000 tonnes of cane a year. The cane is grown under irrigation.
Anglo owns a stake in Mkwasine through its Zimbabwean subsidiary, Hippo Valley Estates, while Tongaat is represented through a local subsidiary, Triangle Ltd.All three vast sugar plantations, which are tucked away in Zimbabwe’s south eastern Lowveld, have been served with notices of compulsory acquisition despite the presence of bilateral investment promotion and protection agreements. The agreements compel the Zimbabwean government to protect investments and properties of other countries from arbitrary expropriation.
The Utete land audit report recommended that land owned by companies in Export Processing Zones should not be acquired under the land reform programme.
Although the government initially said it was not going to seize timber, tea and sugar estates, it appears to have backtracked on the promise with several estates now targeted for acquisition. The government has repealed the Hippo Valley Agreement Act to pave way for compulsory acquisition of the land owned by the country’s largest sugar producer.