Editor’s Memo: Indigenisation policy muddled, confusing

GOVERNMENT’S indigenisation policy remains opaque and two events this week made it more muddled — leaving many of us wondering where we are going.

Industry and International Trade minister Welshman Ncube earlier this week announced the freezing of the indigenisation policy only to have Youth Development, Indigenisation and Empowerment minister Saviour Kasukuwere pouring cold water on the pronouncement by declaring that he alone has the authority to make statements on indigenisation.

One conclusion that can be drawn from the differences between the two ministers is that government has no clear communication strategy and there are multiple voices on the same issue, leaving the recipients confused.

However, there are matters deeper than this: It further exposes the opaque nature of the country’s indigenisation policy as government appears not to have a clear position on this crucial matter.

Given the polemical differences inherent in the Government of National Unity, one would have expected a triangulation of policies, addressing the potentially divisive issues through progressive policies.

But what we have seen since the announcement of the indigenisation regulations in February, causing a 25% fall on the Zimbabwe Stock Exchange, is a fragmented and disjointed policy pronouncement.

What the policy-makers should know is that investors are very sensitive to all the incoherence and confusion we have witnessed since the announcement of regulations and until the channels are clear, they will steer clear of the country.

The indigenisation regulations are premised on wrong grounds as they are not about wealth-creation but grabbing what is already there.

It is a policy that is anti-entrepreneurship as instead of encouraging the formation of new companies and businesses, local investors are being egged into parcelling out shares from operating firms.

If the local investors have the means to buy significant stakes, up to 51%, in say Zimplats (for argument’s sake) why not have them start a completely new venture with their capital?

History has shown that only a cabal of elites benefit from policies such as indigenisation as they usually cannibalise the companies, leaving them as mere shells.

What is equally worrying is that Kasukuwere has shown administrative incapacity in executing this flawed policy as he has failed to come up with new regulations as he promised investors at a conference in South Africa last month.

The investors, the honourable minister should know, are not party supporters whom you tell what they want to hear even if it is not practical.

They are serious, focused people, looking for a safe destination for their investment and would not risk placing it here when there is such policy incoherence.

These investors would like to know how the flawed indigenisation policy would be financed, how it would be carried out and when. Until then, the country would continue waiting in vain for the much needed foreign investment.

 

Constantine Chimakure

 

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