Harare, Zimbabwe — MININGREVIEW.COM — 21 April 2010 – The government of Zimbabwe’s controversial policy of transferring majority control of foreign-owned companies to black Zimbabwean citizens or organisations will begin in the country’s key mining sector.
Under the regulations which took effect on 1 March 1, foreign-owned companies must submit plans to show how they will sell 51% of their shares to black Zimbabweans within five years.
“I am happy to announce that government has unanimously decided that implementation of our indigenisation policy starts with the mining sector,” youth, indigenisation and empowerment minister Saviour Kasukuwere told reporters after a cabinet meeting here.
The world’s two largest platinum miners, Anglo Platinum and Impala Platinum, have multi-million dollar investments in Zimbabwe, while Rio Tinto has gold and diamond interests.
Kasukuwere said government had noted investor fears that foreign firms would be forced to give up shares without payment. “Some of the concerns raised relate to the interpretation of the word ‘cede’ in relation to shareholding, which was misconstrued to suggest compulsory takeover without compensation,” he added.
“The indigenisation programme is based on fair transaction where full value is compensated for,”
Said Kasukuwere. “Hundreds of foreign firms in Zimbabwe have submitted plans to sell majority stakes to local blacks, despite confusion over the affirmative action law that has divided the unity government.
The power-sharing government formed by Mugabe and Prime Minister Morgan Tsvangirai last year is divided over the regulations, which Tsvangirai has said were issued without consulting the cabinet. A spokesman for Tsvangirai said last week that the regulations had been suspended, a statement quickly denied by both Mugabe and Kasukuwere.
Kasukuwere told the state-controlled Herald newspaper earlier this week that foreign firms were complying. “We have received more than 400 submissions from various companies so far, and as government we are happy with such an overwhelming response,” he said.