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Executives of Foreign Firms Engage Zimbabwe Government on Indigenization

  • Gibbs Dube

Employers Confederation of Zimbabwe Director John Mufukare said foreign companies are panicking over fresh threats by Kasukuwere to cancel their licenses, fearing a process much like land reform

Executives of multinational firms doing business in Zimbabwe, facing deadlines of one to two weeks to re-submit indigenization plans, are said to be engaging the government in hopes of avoiding a repeat of the fast-track land reform in which the properties of thousands of white commercial farmers were seized over the past decade.

Some executives said they have received letters from the Indigenization and Mines ministries telling them to act fast or risk losing their firms.

The executives said they may propose local equity stakes for black Zimbabweans of up to 35 percent compared with their earlier offer of 26 percent stakes.

Meanwhile, Reserve Bank of Zimbabwe Governor Gideon Gono and Indigenization Minister Saviour Kasukuwere have been exchanging harsh words over the minister’s threats to cancel bank licenses.

Kasukuwere has dismissed Gono’s calls for a sober approach to implementing the Indigenization and Black Empowerment Act saying that the targeted firms are linked to nations which have imposed targeted sanctions on Zimbabweans.

Employers Confederation of Zimbabwe Director John Mufukare said foreign companies are panicking over fresh threats by Kasukuwere to cancel their licenses.

Economist Eric Bloch said capital flight sparked by indigenization could devastate the Zimbabwean economy, barely recovering from collapse in 2008.

“These threats will further weaken investment in the struggling banking sector and also scare investors in other sectors,” Bloch said.

Economic commentator Rejoice Ngwenya commended Gono for defending foreign-owned banks targeted for indigenization.

Kasukuwere’s latest order also concerns Nestlé Zimbabwe, British American Tobacco and mining firms Zimbabwe Platinum Holdings, Mimosa and Blanket Mine.

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