Accessibility links

Breaking News

Zimbabwe Central Bank Governor Gono Breaks Ranks With ZANU-PF on Indigenization

Sources in the central bank and in Zimbabwe’s largest black empowerment organization, the Affirmative Action Group, said Gono fears indigenization will discourage foreign investment when the country desperately needs it

Reserve Bank of Zimbabwe Governor Gideon Gono has broken with President Robert Mugabe and ZANU-PF on the controversial indigenization program, calling it a "reckless" initiative championed by "vultures."

Sources in the central bank and the country's largest black empowerment organization, the Affirmative Action Group, said Gono fears the indigenization process will discourage foreign direct investment at a time when the country desperately needs it.

"The last six months have seen a flood of interest in the economy from both friends and foes and we must not disturb the momentum by being reckless, inconsistent and self-contradictory with our pronouncements or with what we say or do," Gono told the Financial Gazette, a Harare weekly newspaper. One source familiar with Gono's thinking on the issue said he had referred to some indigenization proponents as "vultures."

VOA was unable to reach Gono to seek confirmation of the views attributed to him by those sources.

The Indigenization and Economic Empowerment Act was passed into law in 2007, but implementing rules were only recently promulgated, sparking fears of an asset grab akin to the land reform program.

Responding to Gono's reported views, Affirmative Action Group President Supa Mandiwanzira told VOA Studio 7 reporter Gibbs Dube that the indigenization process is unstoppable despite the central banker's warning it will hurt the economy.

Mandiwanzira conceded Gono was acting “within his mandate of advising government on monetary policies and other issues." But he added, “We believe that indigenization has to happen now and that is not negotiable."

Gono's reported position on indigenization is somewhat surprising as he is seen as a hardliner in ZANU-PF and is politically close to President Mugabe, who has endorsed the indigenization drive. Gono has also been accused of mismanaging the Reserve Bank by funding operations of the former ZANU-PF government, leading to near-record hyperinflation.