Huge foreign response to Zimbabwe’s 51% ownership demand

Harare, Zimbabwe — MININGREVIEW.COM — 21 April 2010 – Hundreds of foreign firms in Zimbabwe have submitted plans to comply with the empowerment requirements stipulated by the Zimbabwean government, despite confusion over the indigenisation law which has divided the unity government.

Under the regulations, which took effect on 1 March, foreign-owned companies must submit plans to show how they will sell 51% of their shares to black Zimbabweans within five years.

The power-sharing government formed by Mugabe and Prime Minister Morgan Tsvangirai last year is divided over the regulations. A spokesman for Tsvangirai said last week the regulations had been suspended, but this was quickly denied by Mugabe and indigenisation minister Saviour Kasukuwere. The minister told the state-controlled Herald newspaper yesterday that foreign firms were complying.

“We have so far received more than 400 submissions from various companies, and as government we are happy with such an overwhelming response,” he told the newspaper.

“Firms that have not yet submitted plans will get a 30-day extension from the April 15 deadline,” Kasukuwere told The Herald, adding that the government could terminate licences of companies that did not comply.

Meanwhile analysts are saying that the empowerment policy will discourage foreign investment and hurt efforts to fix Zimbabwe’s crippled economy.