The idea is to facilitate an exchange of ideas between policy-makers and business executives.
The panel of discussants featured ministers Saviour Kasukuwere and Tapiwa Mashakada, as well as prominent businessman Frederick Mutanda, who is chairman of the American Business Association of Zimbabwe.
Mutanda kicked off the discussion saying the current indigenisation laws were not workable given the state of the economy, lack of capital and the need for economic recovery. He said government should allow foreign investors to own 100% of their businesses and then reduce that gradually.
Mashakada said while he supported indigenisation he did not agree with partisan politicisation of the issue and its manipulation for electioneering purposes. He said capital is very fickle and could take flight anytime to safer destinations where there is rule of law and property rights. The minister said sustainable capital inflows into an economy largely depend on the investment climate and perception about the country.
Kasukuwere said indigenisaition was a key national objective logically flowing from the history of the liberation struggle. Quoting a UN resolution of 1952, he said every country has a right to assert “sovereignty over its resources” and use that to fight poverty. He said indigenisation was imperative because Zimbabwe was still dominated by Rhodesian economic ownership patterns. He said “tough luck” to those who did not support the current indigenisation policy or its implementation matrix.
Then the floor was opened for debate.
British ambassador Mark Canning fired the first broadside against Kasukuwere. He accused the minister of indulging in “crude populism”, noting his presentation was a disappointment.
“Everything that the minister said this morning will send shivers down the spines of investors,” Canning said. “It’s crude populism. I can only express my disappointment at what I heard.” The ambassador left soon after his comments.
The indigensation debate has poisoned national economic discourse.
It must be said the objective of indigenisation is good, but the policy process, the policy choice and implementation are problematic, even potentially disastrous.
Government, just like everybody, knows that indigenisation is necessary but wants to use gung-ho methods (bordering on seizure or grabbing) instead of equitable ones to achieve that.
The other trouble is that indigenisation is now used as an electioneering tool, not to further the economic transformation agenda but help the political elite to hang onto power and amass wealth.
The danger is that the process would eventually become hostage to narrow and partisan political agendas. Instead of pursuing this issue from an economic transformation and development platform, it is being executed from a patronage perspective.
Therein lies the problem. Indigenisation has been hijacked by the politics of rent-seeking.
The motives of those currently behind indigenisation are clear, no matter how hard they try to disguise them. It’s about electioneering and primitive accumulation.
There is nothing wrong with anyone using indigenisation to secure votes as long as the policy achieves the desired national objective but there is a problem with partisan politicisation of the issue to ensure self-aggrandisement under the pretext of economic empowerment.
What is happening now is that politicians and their cronies have positioned themselves to extract maximum rents from the indigenisation process (we know of ministers running collapsing businesses now trying to use indigenisation to revive their shell companies). Besides, it’s only those who have privileged access to credit, information and contacts with foreign business who will be able to buy large blocks of shares for themselves.
Already there is corruption, bribery and fronting for foreign businesses going on.
At this rate, the policy may well fail and the whole process could end up being like suicidal ideation. It may lead to economic suicide like the land reform programme.