We'll revisit indigenisation deals: Biti

HARARE - Finance minister Tendai Biti has threatened to undo empowerment deals signed by Indigenisation minister Savior Kasukuwere, if his Movement for Democratic Change (MDC) party wins the forthcoming elections.

Biti, also MDC’s secretary general, said Kasukuwere’s controversial policy would be replaced with a broad-based empowerment model.

MDC’s presidential candidate Morgan Tsvangirai squares off with President Robert Mugabe in polls expected to be held this year.

“All the indigenisation agreements signed by Zimplats, Unki and other foreign-owned companies will be cancelled in the first 100 days of Morgan Tsvangirai in office,” Biti told a rally over the weekend.

He said the current indigenisation policy is “elitist” and serves the political grandstanding of Zanu PF ahead of the harmonised elections.

“We want a broad-based empowerment model where everyone in the country can benefit,” Biti said, adding that “with the so-called indigenisation policy there is no ordinary person who has benefited.”

This comes as Kasukuwere’s indigenisation deals — signed with several mining firms — have been fiercely criticised by experts after an exposé by the Daily News unearthed massive flaws and irregularities.

Zimbabwe’s indigenisation policy compels all foreign-owned firms to cede 51 percent shareholding to black locals.

So far, government has indigenised Anglo’s platinum miner Unki Mine, Aquarius’ Mimosa Mining Company and Impala Platinum Holdings’ Zimplats under vendor financing schemes, which experts say are impractical.

Zimplats had the highest empowerment deal, disposing its 51 percent stake at $971 million.

This has even irked Mugabe.

In March this year, the 89-year-old leader said Kasukuwere was wrong to sign off the Zimplats indigenisation compliance deal which has left the nation indebted.

Meanwhile, Kasukuwere has refuted reports that his ministry is amending the Indigenisation Act to get rid of the vendor financing model and correct other errors.

“As the minister responsible, I have the delegated legal responsibility to make regulations in the interests of achieving government policy on indigenisation and economic empowerment, which I deem necessary as my ministry continues to implement, monitor and evaluate the programme,” he said.

Kasukuwere said the ministry continues to engage businesses with a view to achieving the 51 percent indigenous shareholding requirement on a mutual beneficial basis.

“In line with this, my ministry continues to engage the major mining companies on the basis of the term sheets, which we signed during 2012 and early 2013.

“As previously stated, the term sheets are non-binding and subject to negotiation and approval by the relevant government authorities,” he said.

Economist John Robertson said it is possible to reverse the indigenisation policy which is currently non-functioning as it is in conflict with the Constitution.

“The policy can be rescinded or altered but I would prefer a situation where it is totally repealed to help the country easily attract foreign direct investment,” he said.

Robertson said since the promulgation of the land reform programme as well as the Indigenisation Act, there have been no jobs created.

He said cancellation of the law could result in improved economic activity. - Eric Chiriga and John Kachembere

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