Mugabe: Empowerment law confusing investors

Zimbabwe’s black empowerment policy that aims to transfer majority shares from foreign-owned firms to locals is confusing potential investors and makes it hard to compete for foreign investment, President Robert Mugabe said yesterday. The southern African nation passed an Indigenisation and Economic Empowerment Act in 2008, which forces foreign companies, including mines and banks, to […]

Zimbabwe’s black empowerment policy that aims to transfer majority shares from foreign-owned firms to locals is confusing potential investors and makes it hard to compete for foreign investment, President Robert Mugabe said yesterday.
The southern African nation passed an Indigenisation and Economic Empowerment Act in 2008, which forces foreign companies, including mines and banks, to transfer at least 51 percent shares to black Zimbabweans.
But implementing the law has been steeped in controversy, with Mugabe’s ministers often issuing conflicting statements on its implementation, further spooking foreign investors.
For example, the finance minister said on April 2 foreign banks in Zimbabwe had submitted credible plans to comply with the empowerment law, conflicting the youth and empowerment minister who had said banks had not complied.
“This has caused confusion among Zimbabweans, the business community, current and potential investors, thereby undermining market confidence,” Mugabe said in a signed statement dated April 11.