The veteran leader was responding to investors’ concerns that regulations compelling foreign investors to sell 51% stake in their companies to locals was extreme.
Mugabe said: “49% was a hell lot (sic) of equity.” The tone was familiar but the message was not.
At best he is understood to have meant that the proposed shareholding thresholds could be lowered to really worrisome levels.
At worst, investors and whites could end up with no shares or so few in businesses that it would not be worth staying on the shareholder register.
Mugabe’s comments came a few weeks after his government gazetted empowerment regulations compelling whites and foreign shareholders to “cede” 51% stakes to blacks. From his latest statements, investors have more than a problem on their hands.
Even after fulfilling the empowerment quota, it might not be enough to satiate Mugabe’s empowerment cravings.
Analysts feel this could be a policy shift from inside his party. A unity government formed last year between former rivals –– Mugabe and MDC leader Morgan Tsvangirai –– has not yet changed the balance of power.
For Mugabe, foreign investors and whites can take whatever is on the table.
Many feel that the latest stance might no longer be about controlling such businesses. Already, there is talk that the regulations are “discriminatory” and possibly racist. Wording such as “cede” needs to be revised to “sell” among other things, according to business representatives.
Mugabe also had a few words for the Kimberley Process Certification Scheme (KPCS): “Zimbabwe is sick of your pestering; after all we do not really need to get some fancy certificate that our diamonds are conflict-free. We can sell our diamonds our own way. We are trying to play their way, but we could go outside that KP system and do it otherwise.”
He was speaking on the sidelines of a tourism investment conference in Harare last week.
Zimbabwe is a signatory to the KPCS, an organisation formed to curtail trade in conflict diamonds.
Not playing by the rules of the diamond body attracts a single punishment, a ban on Zimbabwe’s rough diamonds.
His Mines minister Obert Mpofu is of the same view.
Worryingly, Mugabe does not care as long as his agendas are fulfilled and some points scored politically.
At his birthday bash last Saturday in Bulawayo, the aged leader changed his mind on the diamonds issue saying Zimbabwe was committed to playing by the book. Unfortunately, the equity bit still stands.
This has become a habit for Mugabe of contradicting himself and leaving his audience puzzled.
But analysts reckon Mugabe’s threats and double speak are no laughing matter and should never be discounted even when he flip flops on key policy matters.
He has stuck his finger in the eye of organisations of similar or even greater importance.
Mugabe opted out of the Commonwealth, a grouping of former British colonies when they humiliated him over issues of governance.
In an interview with an American news agency a few years back, Mugabe said Zimbabweans could eat potatoes if there was no maize or wheat.
Critics equated the maladroit
remark as falling in the same
category –– and the same detachment from reality –– as snooty French queen Marie-Antoinette’s “let them eat cake” riposte to news that her subjects had no bread.
While the French queen might be resting in peace, her equal is still causing shock and awe with his comments.
Reports that the two major political parties are considering fresh elections as early as April 2011 do not help the situation and are possibly driving Mugabe’s rantings.
If that is the case, the 86-year old leader could go all out with populist policies to curry favour with voters.
Mugabe’s party is selling the same line –– empowerment –– voters did not buy two years ago. When that fails, analysts say something even more dangerous to the economy like the re-introduction of the Zimbabwe dollar, will be deployed.
Again, the argument will be the same: the people need money and do not have access to it.
Analysts believe Zanu PF is now devoid of fresh campaign tactics to win the hearts and minds of the electorate and could be trying to get votes come election time by pursuing an even more dangerous policy.
Only last year, Mugabe told villagers that he would bring back the Zimbabwean dollar arguing the rural folk had no access to foreign currency.
Reserve Bank chief Gideon Gono had also gone on a charm offensive explaining the benefits of introducing the gold standard as a monetary system. Economists worry the introduction of the Zimbabwe dollar would reverse economic stability achieved so far.
Almost a decade ago, his government embarked on a land reform exercise that has failed dismally by any measure.
Even Mugabe’s top lieutenants are leasing out farms to the same people they seized them from during the chaotic redistribution programme.
Mugabe conceded in his birthday interview with ZTV that he is aware of party members engaged in the practice.
In recent years, Mugabe has tried other stunts such as price controls and failed.
If anything, such policies proved to be a total disaster.
The same “people” he meant to protect from alleged exorbitant prices at the height of an economic crisis characterised by skyrocketing inflation, turned against him after goods disappeared from the shelves.
Instead of taking stock of other failed policies, analysts say Mugabe is bent on bringing down the economy.
Economist Daniel Ndlela says the planned wealth redistribution will buoy Mugabe’s culture of patronage.
Business representatives feel that government should be focusing on ensuring that the economy grows and there is enough food on the plate for everyone before embarking on a wealth redistribution programme and any such policy that might harm the economy.
Soon it will be electioneering time. And assuming for some strange reason that Zimbabwe’s oldest political party wins a poll on the back of economic empowerment, what will be next as an electoral draw card?