Indigenisation or indigenous confusion?

via Indigenisation or indigenous confusion? – DailyNews Live by Conrad Nyamutata 17 DECEMBER 2013

As a law, the Indigenisation and Empowerment Act states that foreign businesses operating in the country have to cede 51 percent of the shareholding to indigenous Zimbabweans.

However, in light of the criticism since its enactment in 2010, attempts have been made to portray it as flexible. Is it?

As things stand, Zanu PF’s flagship “policy” is mired in fuzziness.

But the correlation between policy and delivery is commonsensical. Without sound and clear policy, you cannot deliver results.

Francis Nhema, the Indigenisation minister said: “There is no debate on the imperative of indigenisation; it is the process of implementation that attracts interrogation…

“We are not applying a one-size-fits-all approach. The peculiarities in each sector and nuances therefore are taken into account in the implementation process.”

Mines and Mining Development minister Walter Chidhakwa said last week that, in exchange for the setting up of refineries, there was the possibility of a rethink of the indigenisation law regarding foreign-owned mining companies. The two ministers seemed to indicate possible flexibilities in implementing indigenisation.

Not so, President Robert Mugabe stated soon after Chidhakwa’s comments, stating: “There will be no exception to the 51 percent to 49 percent indigenisation threshold, which seeks to give Zimbabweans greater control in foreign companies operating in the country.

“I have heard in some quarters that there can be exceptions, but I am saying no. We are saying 51 percent to 49 percent. It’s very clear, that is our stand.”

In other words, Mugabe supports the one-size-fits-all as spelt out by the law.

So what exactly does the “policy” entail?

It would seem, according to Mugabe, the ministers cannot exercise discretion against a law that stipulates a fixed threshold in black and white.

Furthermore, no policy document exists to support the concessions the ministers have been pronouncing.  As such, indigenisation is bereft of clarity. In fact, it so happens that no policy exists on indigenisation. The Herald columnist, Nathaniel Manheru, wrote a few weeks ago: “For a good half a decade after its declaration, indigenisation and economic empowerment does not have a single policy document, a coherent economic argument or model, beyond a cryptic slogan text,” he wrote.

“Not many admit to this, which is why consensus on it is so easy to strike. Each one carries his or her own conception of it…”

Nhema and Chidhakwa — key drivers of the project — hold their own conception of it that seems to contradict Mugabe’s.

One is bound to ask: indigenisation or indigenous confusion?

In the words of Manheru, “indigenisation is yet to become a governing policy; indeed a way of organising the economy and distributing its benefits.”

This is the “policy” upon which Zanu PF has premised transformation of the socio-economic conditions of Zimbabweans by granting them a stake in the economy.

Manheru’s article was titled “Victory without a Party.” Without a clear policy on indigenisation, such “party” for Zimbabweans remains a long way away, if ever. For a potential investor, the mixed signals make it difficult to make any decisions.

Indigenisation resembles a dog’s dinner. But the “indigenous confusion” does not end there.

The government has set up a number of community share ownership schemes for mining operations such as Mimosa, Zimbabwe Platinum Holdings, Unki and Marange Diamonds.

Nonetheless, the schemes do not seem to be premised on any firm legal ground.

Former Finance minister Tendai Biti stated: “There is nowhere in the Indigenisation Act that compels companies to donate money to a community share scheme or to any farm or to anything; so what you are actually seeing is coercion; companies being forced to part with $10 or $15 million.”

“So the issue of community share schemes is actually an afterthought which is not backed by the empowering act… Community share schemes don’t actually have legal existence vis-a-vis the Indigenisation and Empowerment Act.”

Indigenisation has been controversial. But Zanu PF should end the “indigenous confusion.”

It does not help that its flagship economic project lacks coherence and implementation guidelines.

 

COMMENTS

WORDPRESS: 14
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    Total confusion. Chete

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    Nyoni 8 years ago

    CONFUSION IS ZANUS MIDDLE NAME.

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    And confusion is NOT from God: it is from the pit of hell! ZPF needs to change course radically!

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    Khaya'bonina 8 years ago

    This article is from an individual who is confused trying to confuse and mislead the facts , don’t misinterpret the whole mission of indigenisation with your low level of thinking , don’t mix up your history and business economics , where is your confusion ??? Indigenisation in simple terms means that the companies coming from abroad must operate and share with us as the origial people of Zimbabwe (indiginous people), us as the indiginous people are being represented by the government of Zimbabwe under ZANU PF , 51% share goes to the government represnting the people and catering for their needed services , then 49% goes to the operating companies coming from abroad , the 51% goes to the government of Zimbabwe under ZANU PF , then it will be up to ZANU PF whether they use that percentage appropriate or not , remember to think broadly about these policies being implemented , they are for today and for the future running of our industries , should we change the government of ZANU PF they will continue working for the future government ,they can be re-amended or developed but it is of paramount importance that we must always have the foundation then grow up from there , if you continue being against indigenisation , the question to the entire Zimbabweans is how do we have to secure our resources from being exploited , do we have to continue giving away like what happened during time of the colonial rule whereby we had no control of our natural resources , ZANU PF is trying to secure our resources accordingly and to makesure that both parties benefits , now if you are against indigenisation its fine but tell us about how do we have to secure our natural resources ???????????????.

    Coming to your point of mixed statements by the president contradicting what the ministers have said , that is not significant , that is all distortion ,its all about politics as a dirt game , the fact and the truth is on the original draft of the policy pertaining the indigenisation , so get to the facts and abolish being based on hearsay and distorted information .

    I am more concerned , yes indigenisation is discouraging investors to our country , but is it appropriate to ecourage them with so flexible policies which doen’t benefit us , noways , we can’t just give away . ZANU PF is failing and stuggling , but we need to do something for the best of our country , lets work together with this enermy to go forward , let us be Mandela in our own country .

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      Clive Sutherland 8 years ago

      I think you are confused, if I want to start up a business in Zimbabwe and I am told up front, before I invest, that an “indigenous Zimbabwean must have 51%of this Company, no problem, provided the “indigenous” Zimbabwean contributes 51% of the start up capital and assumes all responsibility for 51% of the business. Zanupf is stealing from existing companies by forcing them to give up 51% for nothing!! It is that simple.

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      munzwa 8 years ago

      Khaya,Its all very well for you to say lets all put our shoulders to the wheel… sort out just who is indigenous and who is not and why first and let Zanu not use these laws(sic) to selectively suit themselves. A lot of money has been stolen by these thugs and there are very wealthy people here in Zimbabwe why don’t they put their (your) money where your mouth is, employ the expertise you need from where ever and put your shoulder to the wheel…

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    Michael 8 years ago

    Khaya’bonina
    What a load of garbage you have written. You have zero appreciation of how a free economy should be run. All global nations experiencing growth have free market economies, China included. Any company share holding in the hands of Zanu will never be distributed to the people, it would be like asking a pride of hungry lions to mind your children will you are away. Khaya’bonina you have a severe intellectual deficit.

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    Khaya'bonina 8 years ago

    @CLIVE AND MICHAEL if we talk about indiginous people of Zimbabwe benefiting we are not actual referring to individuals here , we are talking about the entire nation represented by the government , this 51% will be controlled by the government and use part of this share to cater for the services of the people , this is how the goevernment would be able generate the source of income apart from waiting for income taxes from the companies and people .

    Tell me you two guys , how doesn’t the government generate the source of income to provide services for the people , you expect the government to go out and borrow all the time to take care of you , you are trailing behind , Zimbabwe will never succeed because of people like you , go outside Zimbabwe and Indigenisation is happening to neighbouring countries , so whats the big deal , go out of Zimbabwe you are still colonised don’t spread you cancer to those who have got vision .

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      munzwa 8 years ago

      Ok so it comes down to “the Government” and that is the problem, they stole this last election, use unprecedented violence in 2008 and you want us( the investor) to trust our investment with them?Think again!!!!

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      Peter tosh 8 years ago

      You dnot really appreciate that eventually all the money will be stolen by zpf? Try to separate issues u margot.

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    Khaya'bonina 8 years ago

    @Mchael , your problem is here , don’t ever compare Zimbabwe with the world ecomony , remember African is still a developing continent , some of the African states are even under developed even though they have got all the precious stones , have you ever asked yourself why Africa is suffering today , shame , our resources were taken out of African , the westerns are developed today and industrilised because they benefited a lot from our resources , our forefathers couldn’t see this , its a shame that you still want to just give away freely , we cannot simple have a free economy running in our under developed country and in Africa as a whole , we need to implement policies favouring the security of our resources , we need to be well jacked up before we good for free , we are not like a wholesale at this stage ,go back and study your business economics , is indigenisation a new word to you ???

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    Khaya'bonina 8 years ago

    Government will not distribute a share to the people but will deliver the need services to people of Zimbabwe using the share , don’t generalise you little thinking , if ZANU fells to do so , then kick them out .

    @Munzwa ,Indigenisation is clear and have got nothing to do with the Zimbabweans( indiginous people ) opening their companies , but only applies to the foreign companies who feels that they need to operate business in Zimbabwe .The foreign companies cannot just operate freely that would be like giving away , Zimbabwe is not sale . We need to build a foundation on how to secure our resources , its not for ZANU but for the future running of Zimbabwe .

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    Khaya'bonina 8 years ago

    Munzwa , simple indiginous people are the Zimbabweans , foreigners coming to Zimbabwe to do business are not indiginous , so the foreigners must be part of this indigenisation , Zimbabweans can operately freely only paying income taxes , they have got nothing to do with indigenisation , they have got nothing to share with the government okay .

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    Michael 8 years ago

    Khaya’bonina
    It is a great shame your “education” is so lacking in substance. Your comments are let down by very poor grammar, diction and spelling. However, sifting through the chaff of your nonsensical gibberish, I believe your thinking on indigenisation is severely flawed. Mugabe (Zanu) have had 34 year to improve the socio-economic wellbeing of the Zimbabwean people and they have failed dismally. In fact Mugabe (Zanu) has deliberately collapsed the economy so as to mask their blatant plundering of Zimbabwe resources.

    Khaya’bonina you are so blinded by Mugabe’s (Zanu) diatribe that phantom forces are the cause of Zimbabwe’s failings that you are now unable to accept veracity. Mugabe (Zanu) will never disseminate wealth to the people of Zimbabwe, this would threaten their position in government because economic empowerment brings with it socio-economic enlightenment to the gross failure of Mugabe’s government. Indigenisation is about the continued and habitual plunder of Zimbabwe by Mugabe and Zanu thugs.