NEWLY appointed Youth, Indigenisation and Economic Empowerment minister Christopher Mushowe said yesterday government could compel foreign-owned companies to relinquish as much as 99% ownership to Zimbabwean locals.
This is in sharp contrast to acting President Emmerson Mnangagwa’s recent pronouncements that government would relax the controversial indigenisation policy in 2015 to attract much-needed foreign direct investment.
Mushowe’s inaugural speech, which comes only three days after assuming office, sets the tone of how he is going to implement the policy, which compels foreign-owned companies to cede at least 51% ownership to locals.
Mushowe defended his position saying the country’s natural resources are far more than what foreigners bring in as investment.
However, this contradicts Mnangagwa’s recent statement that government would in early 2015 pronounce new business policies biased towards relaxation of the Indigenisation Act blamed for spooking foreign investors.
Mushowe told stakeholders at his Munhumutapa offices: “In fact, they (foreigners) are very lucky that they get 49%; in fact 49% is the maximum and 51% is the minimum so it’s not cast in stone, it can be 1% to foreigners and the 51% for locals can be 99% because it’s a minimum.
“If we understand that then we will get rid of these problems of threatening each other saying if we do this we won’t get foreign direct investment.”
“I have companies mining diamonds in my constituency. The diamonds are said to account for 25 to 30% of global diamond deposits so what do you think costs more, the money they invested or what they have extracted?”
The minister said Zimbabwe has a right to control its policies to suit its needs.
“We are a sovereign state, we welcome foreign direct investment, we welcome foreigners to come into our country and invest but certainly on our terms,” he said.
“If we decide as a country that we must give foreigners 60% and we take 40%, it’s our decision and if we decide the foreigner must take 20% and we take 80% it’s our decision in consultation with the investor so we can’t start saying their money is more important than our resource because it doesn’t work like that.”
Mushowe also said he had demanded the list of beneficiaries of the empowerment policy so far saying the exercise is meant to check for double dipping and expose individuals who benefit multiple times by using different companies which they own.