‘Indigenisation Act necessary for reluctant companies’ | The Herald

via ‘Indigenisation Act necessary for reluctant companies’ | The Herald November 26, 2013 by Lloyd Gumbo

THE Indigensation and Economic Empowerment Act must be amended to give it compliance enforcement power to deal with foreigners who are reluctant to comply with the law, Parliamentarians heard. Secretary in the Ministry of Youth, Indigenisation and Economic Empowerment, Mr George Magosvongwe said some foreign businesspeople stalled the indigenisation exercise as a result of compliance gaps in the Act.

Appearing before a joint meeting of the Parliamentary Portfolio Committee on Youth, Indigenisation and Economic Empowerment and the

Thematic Committee on Indigenisation and Empowerment last week, Mr Magosvongwe said there was need to expedite the indigenisation exercise as enshrined in the law.

The committees were co-chaired by Zanu-PF legislator for Gokwe-Nembudziya Cde Justice Mayor Wadyajena and Harare Metropolitan Senator Cde Cleveria Chizema respectively.

“Some businesses have been slow to react to the instruction to indigenise,” said Mr Magosvongwe. “This is a legal instruction. It is legislated. There are certain gaps in our legislation, particularly in relation to enforcement that need to be rectified perhaps by this

Parliament so that we are able to ensure that all our companies comply with the indigenisation requirement.

“What we are basically saying is: the existing company must indigenise to the extent of 51 percent. The investing company must come through with indigenisation formulae that guarantee that 51 percent will be achieved for Zimbabweans in a given time-frame that they agree with the Minister. And the Minister is just acting on behalf of this House, Mr Chairman.

“There are a number of businesses that have reneged or refused deliberately to comply with the indigenisation law. These businesses take advantage of compliance enforcement gaps in the law to refrain from disposing 51 percent shares to indigenous Zimbabweans.”

Mr Magosvongwe said the Ministry had processed 1 434 applications on indigenisation transactions since 2010 with most of them tilted toward the manufacturing and mining sectors.

He said 481 applications in the mining sector were processed between 2010 to date, while 431 have been processed in the manufacturing sector.

In finance and tourism, the ministry, Mr Magosvongwe said, has processed 118 applications.

He said 59 Community Share Ownership Trusts have been registered in each administrative district of the country.

Mr Magosvongwe bemoaned underfunding of the National Indigenisation and Economic Empowerment Board and the National Indigenisation and Economic Empowerment Fund.

“Lack of adequate financial resources continues to be a major impediment to the fund in executing its mandate of indigenising the economy and undertaking broad-based economic empowerment programmes,” he said.

“As a result, the Board has over the years relied heavily on overdraft facilities with CBZ, First Banking Corporation and Agribank,” said Mr Magosvongwe.

He said his ministry was owing over US$560 000 to its creditors with service providers demanding their outstanding bills, while others were threatening to stop providing their services to the ministry.

Mr Magosvongwe said the ministry urgently needed extra US$2 million before year-end to clear debts and finish planned programmes.

In terms of staff establishment, he said, 15 971 employees were approved, but only 6 948 were employed.

 

COMMENTS

WORDPRESS: 6
  • comment-avatar
    nesbert majoni 8 years ago

    This is rubbish. A clueless regime. They say A desperate situation needs a desperate measure True in this scenario.

  • comment-avatar

    Surely it is a no brainer, pay the original owners 51% of the market value and goodwill and then you will own 51% of he company! It is that easy!

  • comment-avatar
    JakeM 8 years ago

    Oh good ! Another Zpf success story coming up !

  • comment-avatar
    Michael 8 years ago

    Zanu steal the farms off Zimbabwean born whiteman (in many cases more than one generation born in Zimbabwe). Then when these white Zimbabwean start up a new business in the towns and cities, along come Zanu thieves to take their new businesses through the racist policies disguised a Indigenisation. This Indigenisation and economic empowerment policy reeks of the apartheid ideologies of the racist boers.

    We Zimbabweans are capable of starting our own businesses, but what we need are strong economic strategies from our government.

    Damn I forgot Zanu is back in power so there is never any hope for the future.

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    sancho 8 years ago

    Thus Ugandian style what Idi Amin did

  • comment-avatar
    Parangeta 8 years ago

    MEANING OF INDIGENOUS is “Belonging to a place: originating in and naturally living, growing, or occurring in a region or country”

    So what is going on here is RACISM, pure and simple. If you are white you are not Indigenous, you never grew up, originated in the count. even after thee generations. Shona were imposters, the are not Indigenous by ZANU-PF rules! Mugarbage Idiots all!