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Zimbabwe Minister, Central Bank Chief Spar Over Indigenization of Banks

The war of words between Zimbabwe's Indigenization Minister Saviour Kasukuwere and Central Bank chief Gideon Gono over the transfer of majority bank shares to local blacks has escalated, exposing fissures and policy discord in the shaky coalition government.

The spat between the two intensified in the past few days after Kasukuwere gazetted a notice last Friday targeting foreign banks for indigenization. The financial institutions were given one year to comply with the law.

Gono said in a statement the notice is null and void. The central bank governor said Kasukuwere, a shareholder in the collapsed Genesis Investment Bank, “is not a fit and proper person to deal with banks having been involved with the failed indigenous bank”.

Gono, backed by Finance Minister Tenda Biti, Prime Minister Morgan Tsvangirai and Education Minister David Coltart, says Kasukuwere is acting unlawfully.

The empowerment minister hit back Thursday in a Facebook entry accusing Gono of being "immature". He said there was no going back on the indigenization of the financial sector.

The International Monetary Fund has warned Harare of the destabilizing effects of tinkering with the financial sector.

But Kasukuwere’s legal adviser Psychology Mazivisa said there is no going back on the empowerment program, adding his ministry is simply following the law.

Parliamentary budget and finance committee chairman Paddington Zhanda said Gono is misleading the nation as Kasukuwere is simply implementing the law, good or bad.

Independent economic consultant Luxson Zembe said Harare must exercise caution on indigenizing foreign-owned banks.