Govt courts global investors for State firms privatisation drive

HARARE – Government is seeking global investors to engage in the privatisation of struggling State-owned companies as part of wide-ranging reforms set in motion by President Emmerson Mnangagwa since he came to power, the Finance and Economic Planning minister Mthuli Ncube has said.

A former banker, Ncube has been tasked with turning around State companies that have plunged public finances into crisis in recent years, with most of them on the brink of bankruptcy.

Ncube said on Friday results should be expected in the next six months and indicated that the POSB, TelOne and NetOne are part of the list of companies that are to undergo privatisation.

“We should be able to move with speed in the next six months so that we are able to get suitors that will make partnerships with these institutions,” he told reporters, while presenting the Transitional Stabilisation Programme (TSP).

“In that privatisation I am insisting that we must advertise globally; the United States, United Kingdom, Japan; to make sure that we have the best partners and then we get the foreign direct investment that we so much require, the best technology and ways of managing these parastatals so that they become better companies. It is not enough to advertise on the local media.” 

He said he has “done a lot of work in terms of classifying them into various categories; those that can be privatised or transformed, merged, liquidated; that are no longer required, or those that can be subsumed into existing ministries.”

“The urgency here is working on those that are privatisable, for instance with POSB we are going full steam with privatisation; and certainly TelOne, NetOne — here I am just mentioning a few.”

The minister said the licensing fees in the country remain outrageous and unattractive to investors.

“I am aware that our licensing fees remain very onerous. A businessman came to me two days ago and mentioned that he had a choice of either investing in a neighbouring country or here.  Here, he was told he needed 23 licenses to operate in the country and in the neighbouring country he was told he only needed one.  Guess what he did, he decided to invest in the neighbouring country. We need to deal with the licensing issue,” he said.

Mnangagwa in April said he was working on a new investment law to open up the economy to foreign investors, 

He has said the government was preparing a new bill that would simplify investing procedures, cut bureaucracy and create a “one-stop shop” for investor registration requirements. Currently, investors take up to 90 days to set up a business while dealing with several government departments.

The Investment and Business Facilitation Bill, which seeks to give legal underpinning to Zimbabwe’s commitment to opening up the economy is undergoing due legal process, is still to be enacted six months on.

Under the State enterprise reform exercise, NetOne, TelOne, POSB, IDBZ and Agribank will be partially privatised along with subsidiaries of the Industrial Development Corporation (IDC) which include Zim Glass, Allied Insurance, Surface Investments, Zimbabwe Grain Bag, Ginhole Investments, Chemplex Corporation, Deven Engineering and G & W Minerals.

In a bid to do away with duplication, the government will merge Zarnet, Powertel and Africom to create one company while the Postal and Telecommunications Regulatory Authority of Zimbabwe (Potraz) and the Broadcasting Authority of Zimbabwe will be combined to create one telecommunications regulator.

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