On arrival at the Harare International Airport, Nigerian business tycoon Aliko Dangote got a red carpet welcome decorated with rose petals all the way to State House.
Dangote and his team was warmly welcomed and received by President Robert Mugabe, his two deputies and a number of other cabinet ministers and top government officials in what analysts described as a clear act of desperation to attract foreign direct investment (FDI) on the part of government.
While Dangote got treatment befitting a head of state, this remains a dream for local entrepreneurs, some of whom have been hounded out of the country and others frustrated out of business.
Soon after Dangote’s short visit to Zimbabwe, South African-based Zimbabwean businessman Mutumwa Mawere was quick to warn his Nigerian counterpart of the unpredictable nature of Zimbabwe’s “Big Men”.
In an open letter published on his personal website, Mawere said elected state actors believe that economic, like political freedom, can best be won by non-market forces and big ideas like ZimAsset, the government’s latest economic blue-print.
“The idea that Big Men know better is implicitly endorsed by your decision to visit Zimbabwe and is exposed by the choice of your hosts and facilitators. I am sure, in your journey to the station you occupy in life today, you must have come to appreciate the importance of the rule of law in commerce,” he said.
“Zimbabwe’s journey to where you find it has seen many business actors who have been subjected to the rule of Big Men and where the organs of state, established to protect and promote the values in the constitution, have been used to advance personal and predatory interests. Such victims include indigenous business actors as well as non-indigenous actors.”
Mawere is one of many frustrated Zimbabwean businesspeople who have left their country of birth or put their capital outside the country’s borders after being frustrated one way or the other by the government. Mawere in 2007 told the Zimbabwe Independent he had a major fall-out with the country’s current Vice-President Emmerson Mnangagwa after he tried to block a company linked to Mnangagwa from accessing a huge bank loan from a bank in which he had an interest.
The fall-out was to later result in Mawere being specified on allegations of externalisation of foreign currency, resulting in some of his assets being seized or frozen. James Makamba and John Moxon also later faced similar charges but were acquitted.
Econet Wireless founder and Zimbabwe’s richest businessman Strive Masiyiwa appears to be focusing on expanding his business empire elsewhere. In July, Masiyiwa announced plans to invest in Kenya’s energy sector, citing a conducive investment climate and government’s willingness to serve its people as some of his reasons to sink capital there.
Masiyiwa left home in 2000 for South Africa where he founded Econet Group, before moving to London where he is currently based.
He fought government in a gruelling legal battle challenging the state’s monopoly in the telecommunications sector before he won the struggle to set up Econet.
Other Zimbabwean businesspeople who have been forced out of the country or lost their business assets through state action include Intermarket founder and major shareholder Nicholas Vingirai.
Some of them have recovered their assets like James Mushore and Julius Makoni, but suffered at the hands of government.
Former Reserve Bank of Zimbabwe governor Gideon Gono later helped Vingirai and the likes of William Nyemba to get back their assets after a fallout with them.
Even if these Zimbabwean businesspeople, most of whom were created by the state through some extent of preferential treatment under Indigenous Business Development Centre, had criminal charges against them, some of which were just dropped without any prosecution, their businesses could have been saved if the law was applied fairly, analysts argue.
In fact, there is a general feeling that when these businesspeople started making real money, government and ruling party figures began to see them as hostile forces associated with the opposition movement.
Responding to questions from businessdigest, Mawere said all investors, indigenous or foreign, should be treated equally, adding there is need for a paradigm shift in government.
“Zimbabwe needs both FDI and local investment yet the continued reliance on the state and its actors to drive the process betrays the effort,” he said.
“The people responsible for the demise of SMM (Shabani Mashaba Mines), for example, are still in government … if it can happen to SMM that a private company can be placed under state-managed reconstruction, what would stop the same happening to Dangote or anyone for that matter?
“The law being used is still on the statutes and as such it can still be used. The Minister of Justice is not in a hurry to change or repeal it which must worry all investors.”
He said instead of pointing fingers at state actors only, Zimbabweans and investors need to look at themselves to see if they understand the building blocks to an inclusive, prosperous and progressive society.
Mawere said Zimbabwe’s justice system leaves a lot to be desired, especially in disputes involving the state or powerful government officials, making it unfriendly to investment.
The businessman attacked the Indigenisation and Economic Empowerment Act, saying money should carry no labels as indigenous and foreign when its purpose is the same. He said such manufactured differences are not in the interests of human progress.
“The policy of indigenisation is an attempt to interfere with market forces and as such failure is inevitable and predictable. Investment can and should be rewarded through the participation of independent, random and voluntary participants,” said Mawere.
“There is nothing to stop such participants from discriminating against perceived foreign vendors, but it should not be for state actors to seek to unnecessarily alter market landscape through administrative fiat.”
“You should remind Dangote that it is not the only a diabolical Act; remember what happened to (Telecel shareholder James) Makamba. He was arrested and the law was changed while on remand to allow the state to detain suspects for a consecutive period of 21 days.”