GOVERNMENT has overhauled its indigenisation policy as it moves to attract foreign direct investment (FDI) in the country as part of economic reforms spearheaded by President Emmerson Mnangagwa’s administration.
By Melody Chikono
The regulations compelling investors to sell controlling equity stakes will now only apply to diamonds and platinum extraction while other sectors of the economy will be spared. This marks a significant policy shift on the part of the Zanu PF government.
Government enacted the Indigenisation and Economic Empowerment Act in 2008 to empower the historically disadvantaged indigenous Zimbabweans.
Analysts, however, still insist that government should repeal the policy to enable Zimbabwe to attract more foreign investments with low FDI inflows over the years being recorded.
Chinamasa said the amendment will see the economy open up to investors.
“Accordingly, the proposed amendments will confine the 51/49 indigenisation threshold to only the two minerals, namely diamonds and platinum, in the extractive sector, the 51/49 threshold will not apply to the rest of the extractive sector, nor will it apply to the other sectors of the economy, which will be open to any investor regardless of nationality,” he said.
As the country seeks to attract both local and foreign investments, Chinamasa said existing and potential investors should be fully guided by the amendments.
He added that the reserved sector was only for Zimbabwean citizens.
Conditions subject to approval will include the ability of the business to create employment, availability of opportunity for the transfer of skills and technology for the benefit of local people, promotion of the creation of sustainable value chains as well as the ability of the business to meet the prescribed social and economic objectives.
Those already in the reserved sector, except gold panning, will be required to register and comply with the laws.