ZIMBABWE – Former Zimbabwean Finance Minister Tendai Biti says the nationalisation of mines, or a variance of that policy, has not benefited ordinary citizens in his country.
Rather, he says it enables “crony capitalism”.
In Zimbabwe, a law that indigenous people should control at least 51 percent of foreign-owned companies, was signed by President Robert Mugabe in 2008.
Biti, a politician and a lawyer, is one of the speakers at the Mining Indaba underway in Cape Town.
The former minister says nationalisation policies have not benefited the majority in Zimbabwe.
“What has simply happened is that it has just become a playground of cronyism and crony capitalism – it doesn’t work. Remember, when you buy those shares from a shareholder in London you are not adding any value.”
He adds that what is key for economies such as Zimbabwe is the building of the local economy.
“I would rather own 10 percent of an elephant, than 100 percent of a rat. The model that African governments, the Zimbabwean government, is pursuing is encouraging the economies to become a rat and there is no flesh on a rat.”
Biti has proposed a major “paradigm shift” in the mining industry to stave off threats such as nationalisation on the African continent.
“There is an obligation to communities, after all you are mining their depleting resources.”
Biti, once an opposition MDC politician, served as Finance Minister between 2009 and 2013.