Business
Zimbabwe insists that indigenization is not nationalization
A power-sharing government of rivals President Robert Mugabe and Prime Minister Morgan Tsvangirai formed after 2008 polls ended years of crisis and stabilized the economy.
Negative ripples from the indigenization policy have been felt with key projects put on hold because investors are not keen to invest without a controlling stake, said analyst Erich Bloch.
“We have lost the potential to attract investment. The indigenization policy is ill-advised and damages the economy,” he said.
“Which investor would want to invest where half of his investment will be taken and wouldn’t have a say in the running of their businesses?”
The plan for Zimplats, the local subsidiary of South Africa-based Implats, transfers 10 percent of shares to workers, 10 percent to a community trust in Ngezi where its mine is located and 31 percent to a National Indigenization and Economic Empowerment Fund.
The companies are meant to be compensated, but questions have been raised about how Zimbabwe will be afford to pay for the shares in the local arm of the world’s second largest platinum miner.
The Treasury has even said the country cannot hold elections, which Mugabe is pushing to hold this year.
