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Zimbabwe Gives Foreign-Owned Firms a Fortnight to Submit Indigenization Plans

  • Gibbs Dube

The state-run Herald newspaper said the order targets Barclays and Standard Chartered banks, mining firms Zimbabwe Platinum Holdings, Mimosa and Blanket Mine and British American Tobacco

Zimbabwean Indigenization Minister Saviour Kasukuwere this week gave two banks and several multinational corporations deadlines of one to two weeks to submit plans for the transfer of a controlling shareholding stake to indigenous or black investors.

Reports said Kasukuwere threatened to shut down firms that did not comply.

The state-run Herald newspaper said the order targets Barclays and Standard Chartered banks, mining firms Zimbabwe Platinum Holdings, Mimosa and Blanket Mine and British American Tobacco. Blanket Mine and BAT have been given seven days to draft new black empowerment plans. Other firms including Nestle Zimbabwe were given 14 days to respond. The newspaper did not say when the deadline countdown started.

Executives at some affected companies said they have not received such letters from the ministry, and declined to comment further. Kasukuwere was not available for comment.

Economic commentator Masimba Kuchera said he did not believe Kasukuwere would ultimately manage to take over the multinational corporate units.

Bulawayo-based human rights attorney Kucaca Phulu said ZANU PF will try to manipulate the law to grab control of foreign-owned firms.

Meanwhile, Reserve Bank of Zimbabwe Governor Gideon Gono furiously responded to Kasukuwere’s threats saying the central bank has neither given notice nor does it have any immediate or foreseeable intentions to withdraw operating licenses from any registered financial institutions under its supervision.

In a statement, Gono said the RBZ is prepared to work with banks not complying with black empowerment laws but “not in a manner that smacks of irrational exuberance during these times of necessary soberness.”

He said the Southern African Development Community will not allow member states to stir financial instability in the region when the world is facing an economic crisis.

Gono said Zimbabwean authorities are already battling to stabilize indigenous-owned financial institutions facing serious liquidity constraints. “To this end, tendencies towards firing harmful verbal economic gunpowder must be minimized by all stakeholders in the interest of the economy,” the central bank governor said.

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