ZIMBABWE – YOUTH Development, Indigenisation and Empowerment Minister Saviour Kasukuwere is mounting pressure on foreign-owned banks to comply with the empowerment laws as no company will be spared from the indigenisation programme.
The foreign-owned banks targeted for indigenisation are Barclays Bank, Standard Chartered Bank, Stanbic Bank, MBCA and Ecobank. Minister Kasukuwere said there would be “no sacred cow spared, no stone unturned” to ensure all firms comply. The law requires foreign-owned firms to turn over their majority stakes to black Zimbabweans.
“I would like to encourage other companies, particularly in the banking sector, to comply with our national laws as non-compliance will no longer be tolerated,” said Minister Kasukuwere at the signing ceremony of the US$971 million empowerment deal between Zimbabwe Platinum Mines and the Government last Friday.
“Uncalled for defiance and arrogance will not be tolerated as companies must respect the law and desist from provoking the State. There will be no sacred cow spared, no stone unturned to ensure that the policy is fully implemented.”
Finance Minister Tendai Biti and Reserve Bank of Zimbabwe governor Gideon Gono have expressed their reservations on rolling out the empowerment programme in the banking sector saying the move could collapse the country’s financial industry.
Last year in March, Gono said moves to transfer ownership to indigenous Zimbabweans would have unintended consequence “Banking is a sensitive area which should be left alone. Indigenising those banks will make life more difficult for the people. The move will also make life difficult for me as the Governor because when there are problems in the sector as a result of indigenisation, people will point a finger at the central bank,” the central bank governor said then.
Minister Kasukuwere said the indigenisation and empowerment programme was a national approach designed to benefit indigenous Zimbabweans on a broad-based scale.
“Our emphasis on broad-based participation has clearly shown that the indigenisation programme in the main does not benefit elite indigenous persons but rather broad groups of indigenous Zimbabweans,” he said.
“To date, my ministry has achieved for communities around the country, value in the form of shares in the mining companies in excess of US$1 billion. Apart from this capital value due to communities, the trusts will henceforth begin to benefit from annual dividends declared by mining companies.”
He said more than US$110 million has either been pledged or paid out to community share trust by mining firms as seed capital for various income generating and developmental projects. While the indigenisation is viewed in certain sections as an impediment to foreign direct investment, Minister Kasukuwere said such investments should be attracted in a sustainable manner which promotes the development of the country.
“Historically, we have seen foreign investors come and exploit our resources and our people while taking away profits in the form of dividends. This is not a sustainable model of doing business. What we have achieved with Impala Platinum in this transaction is a sustainable model of partnering with foreign investors for the development of our country and our people,” said Minister Kasukuwere.
Meanwhile, Minister Kasukuwere said Government is developing an Economic Empowerment Policy which will focus on creating new business largely owned by indigenous Zimbabweans and new ways of accelerating rural development and economic growth.