EDITORIAL COMMENT: Indigenisation: No one is above the law

Youth, Indigenisation and Economic Empowerment minister Patrick Zhuwao told the nation disturbing news last week. He said Cabinet had endorsed a decision to stop the operations of all companies which had ignored the country’s indigenisation law. We hope that decision will not come to pass. We hold no brief for any of the companies likely to be affected by this Cabinet decision. We are largely looking at two key scenarios: first the implications and ramifications of that Cabinet decision being implemented and what it means for the economy and the workers.

Second, we want to believe the companies so affected have sense enough to weigh their options. They have a wide berth, to comply or to ignore the law.

Zimbabwe’s economy is in dire straits and Government has been trying to shore it up by promoting local initiatives like growing the informal sector and the Buy Zimbabwe campaign. Government is also trying to foster the consumption of local products to reduce the import bill on non-essential goods to save foreign currency.

There have also been efforts to attract meaningful foreign direct investment by improving the ease of doing business in the country. That explains why Government has remained engaged with the International Monetary Fund. This has also resulted in a number of business executives visiting the country to explore business opportunities. The latest was a South African delegation early this month which culminated in pledges to invest at least $500 million in Zimbabwe this year.

Locally, we believe there are companies which are doing their best to stay afloat under a difficult operating environment. Such efforts need to be commended and buttressed by Government incentives for them to save jobs.

Memories are still fresh and casualties aplenty of thousands of workers who lost their jobs following the Supreme Court ruling of July 17 last year that companies could terminate employment contracts on three months’ notice without giving a justification. Although the figures of people affected are contested, there is no denying the trauma that ruling caused.

Some people saw Government’s hidden hand in the Supreme Court ruling as it sought to meet the austerity requirements of the IMF’s Staff Monitored Programme to cut its payroll through “retrenchments”. It would therefore be risky to make light work of closing down companies and throwing more people on to the streets without any safety nets or alternative viable programmes of self-sustenance.

But Minister Zhuwao also pointed to something sinister: that there were people colluding with and influencing some companies not to comply with the country’s indigenisation laws. Such companies have been vocal about the need for policy consistency and clarification, albeit only through newspapers and social media instead of engaging Government directly to express their reservations.

Such companies, noted Minister Zhuwao, seemed to dare the President and his Government to a fistfight. If there is one thing which should be made clear, it is that no individual or company is above the law of the country. It is that simple. You may like or not like certain laws. There are ways of raising objections. Deliberately violating the law is not one of them.

Most of the big companies defying the law in Zimbabwe are very compliant in their own countries. They will not wilfully break the law in their own country simply because they don’t like it. Instead they will lobby, including bribing MPs if necessary, to have the law amended or repealed. They will succeed or fail depending on the reasonableness of their demands.

Indigenisation is one such very fundamental law to Zimbabwe’s economic well-being.

Now, when the same companies come to developing nations they want to arm-twist and manipulate the host country to maximise profits. They want to exploit the desperation of the host country to further plunder its resources for a penny in the name of employment creation. They are never interested in the prosperity of their host, but the size of their profit margin.

Such companies cannot try to hold the country to ransom in the name of jobs. They are simply not interested in doing business here except on their own terms.

We hope they will not call Government’s bluff, taking the April 1 ultimatum for a Fool’s Day joke.

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  • Ijaha le Maguswini Amnyama

    This is a fair comment editor but it would help if you shared with readers which country in the world has a 51:49 share requirement in the world. In short which country asks an investor to bring 100 million dollars of which 51million should be given to locals. It simply does not make economic sense baba. We should as Zimbabweans interrogate this requirement further:are our politicians not just trying to get free stakes in companies just as they got hold of free productive farms which they ran down.And is Shabani Mashaba Mines a good example. So yes companies need to obey the law but do we really need this legislation now. Has our SADC neighbours not abandoned the same path(nationalisation?)

    • Shabani Mashaba

      When you touch the Shabani Mashaba saga you touch a raw nerve. You touching a very painful subject. It was reconstructed by some wise person who dispossessed a genuine businessman. However, ironically the reconstruction sounded a death knell to what was once a behemoth of an African mining adventure. An envy to many across the globe. What we touch turns to dust. Honestly, what has gotten into our heads? Are we serious? Lets introspect before we delve into this area. We need Foreign Direct Investment now than ever before. This policy is what we do not need at this juncture in our tainted economic history. Lets do small things right first before we seek to take well run entities with a rich corporate history.

  • wesley

    Thiis is just out of order – you are a newspaper not a hack mouthpiece of a very untried and tested minister who is himself a “foreigner. What credibility do you have to do this sermonizing?
    As a news piece or an editorial – you should point out the disaster that this law is – and how it will only ruin the already disasterous economy. Mr Editor – you run a newspaper not just a propaganda mouthpiece. Shameful.

  • Piankhi

    When you have a country that is desperate to boost its economy is does backward things out of being lost in good business practices to help boost its economy. The question for Zimbabwe, as it taxes it people to death to generate revenue and chase potential or other investor wanting to help is a sign of bad management and people in position that have no experience to run certain ministries. I have no problem with Zimbabwe saying 51-49. But why is this directed to all investors. If the purpose of creating a level playing field to help its population of indigenious blacks. This policy should have only been done to Europeans who have been raping the country for generation. Instead they screw all there other brother and sister who come to Zimbabwe to invest from Zambia, Malawi, Mozambique in particular, Tanzania, Angola, these are all the countries that helped to assist in the liberation of “Zimbabwe and what do their brothers and sister get when they come to Zimbabwe is screwed by their brothers. The point is: If the British and other Western countries stole untold fortunes from Zimbabwe over the occupation. Then it seems that 51-49 should only apply to those thieves as their countries proper because of the thief from their fore fathers. Same thing with land reform. I am 100% percent for it. But when it was done for the good of the people. There was nothing in place to keep production and profitability sustainable. And now today Chinamasa say they are will to pay white farmer compensation for taking the land back. HOW DO YOU EXACTLY COMPENSATE A MURDER, RAPIST, ROBBERS AND THIEVES, FOR SOMETHING THAT WAS STOLEN FROM YOU AND IS YOUR BIRTH RIGHT BECAUSE YOU ARE SO WEAK IN YOUR MIND that you cannot set good policy to with the resource you have to prosper. Zimbabwe is probably one of the richest countries in Africa. But cannot generate $1 billion dollars a month. Gold, Diamonds, Platinum, Chrome, Coal, Methane to generate power for all of Southern Africa. They problem is that Zimbabwe is so busy trying to make friends with its enemies to get crumbs from them. Not realizing that the money you are begging for from the IMF and World Bank are the same monies they stole from your country in resources over the last 100 years or more. I have tried to work with Zimbabwe many times to show them it is very simple to turn around their economy. But they would rather keep looking North, South, East, and begging the West for consideration of being human beings when they have been treated like dogs for over a century. I guess when your oppressors have captured not just your country but your mind also. You eventually become like your oppressors to your own people. It is sad but these are the fact. I am an African American and my ancestors were kidnapped from our mother land and taken far away to our oppressor lands to build for them for nothing for the past 450 years and have nothing to show for it. Zimbabwe is different. It has its land now. But keeps blaming the West for in mismanagement of it rich resources. How long do you think you can keep using that story. Me as an educated African American business man, with my group, could turn around Zimbabwe economy and other countries in the region within 36 months and have the biggest GDP combined. The only way you can do this is stop being afraid of your oppressors. Their gone. Stop talking to them, stop giving them your time and replies of what you do in your country. Do you think Britain gives a shit about what Zimbabwe say about them? NO!!!! Our private group has money, to turn around this small country over night. But the problem is you deal with people in Zimbabwe who wants to control someone else’s money and investments. ‘And it will never work. Look at the rest of the world; it is the private sectors that build economies. The U.S, Europe, 80% private sector the created jobs and revenues for those governments to build their countries over the last 100 years slaves for not. My African American group only wants to help, but if you think $1 Trillion dollar spent by African Americans is not real, well think again. Every race of people comes to our communities to become rich including Africa. The poor Chinese, Indians, Arabs and other immigrants come poor and within year they become rich in the midst of our African people from our African people. Nothing will ever change form African people worldwide until we start to work with each other for the benefit of our people. Not just the elite. We have new technologies to process gold over any currently used, international markets to control the fair sale of resources; we can build communities as we have in theses. Only question is. Will our brothers and sisters welcome us back home to the mother land to untilize the knowledge we obtain be living in the belly of the beast for 450 years. Remember, if African wasn’t so beautiful, the white man would not want it. And it is all yours. What do you want to do? Stop thinking if it is white it has to be right. White has never been right for Africa and other countries that has suffered from their foot prints. Screw the IMF and World Bank. We can take your resources and get rid of those minor debts in less than 24 months and create a $20 billion GDP within 36 months. Guaranteed, Facts, no Dought So either we work together or brothers and sister, or you can keep looking EAST, rather than looking inside you first.

  • aboobakah

    This is the worst piece of legislation to be adopted by any country. how can one bring 100 milllion bucks ivestment and u demand 51 million? let us be serious should we want to build this great nation of ours

    • Togarepi

      It doesn’t mean that please do a little bit of reading and try to understand that those people coming here to invest realise you have something in return. That something is what constitute the 51%. The problem is a lot o comments here are coming from people who are ignorant zvinoshamisa. How many times do you want the President to explain what constitutes 51% nhai. In fact most countries have a higher indigenous ownership requirement than Zimbabwe. How did China got to where they are? Look at their investment policy then come back to comment. You need to concentrate on what Pianki (the brother from the States) is saying. I agree with him/her 100%. Our economy can be turned around with minimum farce if only the leaders are serious. Period.