Zanu-PF is forging ahead with plans to seize foreign-owned firms operating in Zimbabwe, with Indigenisation and Empowerment Minister Saviour Kasukuwere threatening some 9 500 companies with closure after they failed to meet a June deadline to submit proposals on how they will cede a 51% stake to black Zimbabweans.
Following an uproar in March over the harsh law, Kasukuwere made revisions, giving companies until the end of June to comply.
Some 480 firms have so far submitted proposals to the indigenisation ministry and Kasukuwere is understood to be “in the process of sending out legal notices” to force compliance.
He said: “If the companies don’t comply within 30 days, we will cancel their [trading] licences. They will also appear before the courts.”
Under Kasukuwere’s direction, Zanu-PF youths in the Matabeleland region have been told to grab mining companies that have closed or scaled down their operations.
Foreign-owned firms affected by the Indigenisation and Economic Empowerment Act include the Standard Chartered and Barclays banks and mining giants Impala Platinum, Rio Tinto and De Beers.
Zimplats, owned by South Africa’s Impala Platinum group, has stalled the construction of an underground mine and dam in Zimbabwe until the compliance issues are finalised.
The indigenisation law requires foreign firms in Zimbabwe with an asset value of $500 000 or more to cede 51% of their shareholding to locals within five years.
In response, Royal Dutch Shell and British Petroleum have already announced the withdrawal of their Zimbabwean subsidiaries and are selling their assets.
Investor wariness has affected the Zimbabwe Stock Exchange (ZSE), which since March has lost $1-billion. A ZSE official has linked “the depressed stock market activity to the uncertainty caused by the indigenisation regulations”.