Opposition parties and economic analysts have criticized proposals by Youth and Indigenization Minister Patrick Zhuwao to levy companies to fund black empowerment programs.
Zhuwao told the State-run Herald newspaper that under the proposed regulations, companies that have yet to comply with indigenization laws will be levied 10 percent, while those that have will be excused.
The proposals have set off a storm with the Movement for Democratic Change (MDC) formation led by Welshman Ncube calling them “idiocy of the highest order.”
Party spokesman Kurauone Chihwayi told VOA Zhuwao’s efforts do not augur well for a country badly seeking foreign direct investment.
“We actually view this move as an unconstitutional move, an idiotic move by the regime and this is a desperate attempt to loot from the distressed companies, the remaining companies that we have in Zimbabwe and we cannot allow that to continue to happen,” said Chihwai.
“Zanu PF has a history of looting from the people of Zimbabwe and we should not allow them as a country to continue fleecing the remaining companies that are operating in Zimbabwe.”
Independent economic analyst Rejoice Ngwenya agreed with Chihwayi, adding the government should instead focus on introducing policies that create more companies and wealth in Zimbabwe rather than wanting to impose on already suffering companies.
“In the first place, which companies is he talking about because the industry is operating at 36 percent capacity,” said Ngwenya.
“If you want to take the informal sector which is the bulk of the employer and the country then that should be fine.”
He said more companies will go under liquidation if Zhuwao and his colleagues pursue their intentions to levy firms to fund indigenization programs.
Ngwenya noted that the policy will result in more anger and acrimony being channeled towards the ruling Zanu PF party.