Victoria Falls, Zimbabwe — MININGREVIEW.COM — 31 May 2010 – The government of Zimbabwe will not expropriate mines and is refining its controversial local ownership law in order to enable miners to expand their operations in the southern African country.
Reuters reports that this could ease concerns among foreign-owned mining companies operating in the country, which have been reluctant to expand their operations fearing their businesses could be seized.
“Government has no intention of expropriating the mining industry. No mine has been nationalised since independence,” President Robert Mugabe told an annual mining conference here.
Earlier this year the government published regulations forcing foreign-owned firms, including mines and banks, to transfer a 51% stake to Zimbabweans “’ a move which divided the power-sharing government and upset investors.
“The implementation of the empowerment initiative will take cognisance of the need to promote growth of the mining industry. Such growth requires new investment, particularly foreign direct investment,” Mugabe said. “Accordingly, mechanisms are being refined to ensure that investors find it attractive to expand current operations and bring new investment into the country.”
The regulations took effect on March 1 and require foreign-owned companies to submit plans to show how they will sell 51% of their shares to black Zimbabweans within five years. Western donors have continued to withhold critical funding needed to rebuild Zimbabwe’s shattered economy, saying the government should first implement political and economic reforms and respect the rule of law.