(Last Updated on May 30, 2014 by Editor)
HARARE – Zimbabwe will always give preferential treatment to Chinese investors as they stood by the country during tough times, Indigenisation minister Francis Nhema said.
He, however, said government will enact legislative pieces that restrict and govern the Asians’ investment.
“The Chinese are particularly offered preferential treatment because they were there when things were bad,” Nhema told an Institute of Chartered Accountants Zimbabwe CFO forum this week.
“Government is now trying to enforce legislation to monitor all investors on the ground, but there are relationships that have been acquired, which will always be preserved,” he added.
Zimbabwe adopted a “look east” policy in 2004, after top government officials and State enterprises were slapped with sanctions by the UK, the United States and other Western countries.
The policy has encouraged China and other Asian countries to invest in Zimbabwe, which they have done without much stringent conditions from the southern African nation.
While the country regards China as its key economic ally and “all weather” friend, the Asian nation’s prime minister Li Keqiang recently embarked on an African tour — targeted at strengthening ties with resource-rich nations — but did not come to Zimbabwe.
Nhema also urged investors to approach him with their investment offers if they face hurdles in trying to invest in the country.
“Let investors come to me with their offers and put them on the table. The policy is very flexible and as long as these investors are willing to observe our laws, they are very welcome,” he said.
Investment-starved Zimbabwe is desperately trying to attract Foreign Direct Investment (FDI) and access international lines of credit.
Investors and financiers however, are wary of its policies, particularly the indigenisation law — compelling foreigners to cede majority shareholding to black locals.
But, Zimbabwe shifted stance in the implementation of the empowerment policy with President Robert Mugabe recently ruling out a one-size-fits-all approach, saying only companies utilising the country’s natural resources will be required to immediately turn over majority stakes to indigenous Zimbabweans.
This was a departure from the aggressive and rigid style pushed by former Indigenisation minister Saviour Kasukuwere, who pushed for a blanket 51 percent empowerment threshold despite nature of the sector.
Government is now implementing a sector specific approach.
Nhema added that government sought to protect indigenous Zimbabweans through the law, and not repel FDI in the process.
“We want investment, we need the investment, but sometimes we are caught up in our own fights and fail to see the good in different actions,” said the former Environment minister.
“The way the (indigenisation) policy has been portrayed leaves a sour taste in the mouth, but essentially I am here to clarify… that the country is open to engaging with serious investors,” he said.