Black em­pow­er­ment laws ‘within months’

The Star Early Edition - - BUSINESS NEWS - Brian Latham, Nas­reen Se­ria and Antony Sguazzin

ZIM­BABWE’S gov­ern­ment would publish in­dus­try-spe­cific lim­its on own­er­ship in its black em­pow­er­ment laws within months, with for­eign-owned min­ing com­pa­nies re­quired to cede at least 51 per­cent of as­sets, Fi­nance Min­is­ter Pa­trick Chi­na­masa said last week.

“Min­ing will be treated dif­fer­ently, be­cause the min­eral is ours, it be­longs to the state,” Chi­na­masa said.

Zim­babwe is strug­gling to at­tract in­vest­ment in a na­tion that holds the world’s sec­ond­largest chrome and plat­inum re­serves, partly due to pol­icy un­cer­tainty re­lated to its so­called in­di­geni­sa­tion laws.

The In­ter­na­tional Mon­e­tary Fund said ear­lier this month that Zim­babwe must pro­vide more clar­ity on the rules to in­vestors and re­lax labour laws in or­der to re­store con­fi­dence in the econ­omy.

“Any in­vestor who comes to ex­ploit our nat­u­ral re­sources will be treated dif­fer­ently than for ex­am­ple an in­vestor that’s com­ing into bank­ing or an in­vestor com­ing into man­u­fac­tur­ing, who is com­ing with his cap­i­tal, with his equip­ment,” Chi­na­masa said.

An­glo Amer­i­can Plat­inum, Impala Plat­inum Hold­ings and Rio Tinto are among com­pa­nies min­ing in the coun­try.

Chi­na­masa is fore­cast­ing eco­nomic growth of 3.1 per­cent this year and 3.2 per­cent next year.

“We have done a lot of work which we need to fi­nalise to clar­ify” the in­di­geni­sa­tion laws. “It’s to clar­ify that it’s not a one-size-fits-all. There will be a sec­tor-by-sec­tor ap­proach.”

The in­di­geni­sa­tion law re­quires for­eign and white­owned com­pa­nies with as­sets of more than $500 000 (R5.47 mil­lion) to cede or sell a 51 per­cent stake to black peo­ple or the coun­try’s Na­tional Eco­nomic Em­pow­er­ment Board.

The gov­ern­ment is un­able to curb the wage bill, which is es­ti­mated at about 76 per­cent of state ex­pen­di­ture.

While it should ide­ally be about 40 per­cent to 50 per­cent, most of the wages are paid to teach­ers and health work­ers. – Bloomberg

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