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Zimbabwe Won't Shut Down Corporations Not Complying With Indigenization Program - Ministers


Officials in other ministries said Indigenization Minister Saviour Kasukuwere does not have the authority to demand indigenization plans in sectors when no threshold has been specified yet by the Cabinet

A senior Zimbabwean manager of the country's controversial indigenization or black empowerment process said Tuesday that more than 700 firms missed a deadline on Sunday for submitting plans on how they intended to comply with regulations.

Indigenization Board Chief Executive Wilson Gwatiringa told journalists only a few firms in various sectors have submitted plans to comply with the Indigenization and Economic Empowerment Act and regulations for implementation of the law requiring a controlling 51 percent stake in foreign firms to be put in the hands of local investors

β€œAn audit will soon be conducted to determine the extent in which companies have complied with the this law,” Gwatiringa said.

But senior officials in other ministries dismissed the deadline saying no foreign-owned firms would be nationalized or forced out of business for failing to meet it.

Industry Minister Welshman Ncube, Mines Minister Obert Mpofu and Deputy Indigenization Minister Tongai Matutu said the deadline concerned only the mining sector as the Cabinet has just set thresholds for general industry and commerce.

Ncube and Matutu said the government cannot start demanding detailed indigenization plans from manufacturers and retailers without indicating what proportion of their equity must be placed in the hands of black investors over the next five years.

They said Indigenization Minister Saviour Kasukuwere does not have the authority to demand indigenization plans in sectors when no threshold has been specified.

Kasukuwere told VOA he is still looking at proposals submitted by mining firms.

Ncube, head of one formation of the co-governing Movement for Democratic Change, told VOA Studio 7 reporter Gibbs Dube that companies will submit indigenization plans following the publication of sectoral thresholds.

Deputy Indigenization Minister Tongai Matutu said Kasukuwere is misleading the world and himself in setting indigenization deadlines.

Mines Minister Mpofu said talks are still going on between the government and mining firms over what constitutes an acceptable plan.

The Indigenization and Economic Empowerment Act obliges companies with a net value of US$500,000 or more to sell a 51 percent stake to indigenous Zimbabweans.

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