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Zimbabwe Accepts Mining Firm Indigenization Proposals - With Reservations

Kasukuwere said the government has accepted the 25 percent equity stakes the companies have offered, though it intends to vigorously pursue the remaining 26 percent on behalf of communities around the mines

Zimbabwean Indigenization Minister Saviour Kasukuwere said Wednesday that it is not true, as reported, that Harare rejected all of the 175 local ownership proposals received from foreign mining firms while issuing warning that it will eject firms that fail to meet a September deadline on transferring majority ownership to blacks.

Kasukuwere told VOA that the government has accepted the 25 percent equity stakes offered by foreign-owned mining companies, though it intends to vigorously pursue the remaining 26 percent of equity on behalf of communities around the mines.

Reuters earlier quoted Kasukuwere as saying Harare had rejected all the proposals from mining firms that did not offer a 51 percent controlling stake for black investors.

Under the government's controversial black empowerment law, foreign miners operating in Zimbabwe must sell a majority stake to local black investors or risk seizure.

"We have received 175 proposals from mining companies and while we are not entirely happy about it, we have received the bids and are proceeding and doing our job," said Kasukuwere in an interview. "The proposals were that 26 percent would be done through social credits and 25 percent direct equity."

He said the government had rejected the offer of 26 percent in social credits.

Social credits are notional equity points credited to firms for investing in infrastructure and local development projects such as roads, schools and hospitals.

"That is the job of the government to provide infrastructure and not the mining firms so we will work with what is here now while we pursue the remaining 26 percent equity," said Kasukuwere.

Zimbabwe has the world's largest known platinum reserves after neighboring South Africa. Major foreign miners operating there include Zimplats Holdings, a unit of Impala Platinum, global mining giant Rio Tinto and Anglo Platinum.

The country's mining sector, which has been starved of capital after years of decline, also produces gold, diamonds, ferrochrome, coal and iron ore reserves.

Kasukuwere told VOA Studio Seven reporter Blessing Zulu that the government, though unhappy with the offers has accepted those received to date.

Economic commentator Rejoice Ngwenya said he does not see mining companies being booted out of the country in September even if they fail to meet indigenization targets.

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