Australia wants clarity on indigenisation

via Australia wants clarity on indigenisation – The Zimbabwe Independent August 28, 2015

THE Australian government has invited Zimbabwean officials to a mining conference next month in Perth — the capital of Western Australia — to clarify the country’s controversial indigenisation laws to international investors.

Faith Zaba

This comes as the Australian government warned this month that Zimbabwe risks losing out on much-needed foreign direct investment, especially in the mining sector, if it continues to drag its feet on revising its indigenisation laws blamed for spooking foreign investors.

The indigenisation laws, which compel foreign-owned firms in key sectors of the economy such as mining to cede a majority stake of at least 51% to indigenous Zimbabweans, have been criticised for lacking clarity and consistency.
Amendments to the contentious Indigenisation Act have not calmed investors.

High-powered delegations, one led by Industry minister Mike Bimha, are also going to the United Kingdom and France where, among other issues, they will be pressured to clarify the indigenisation law and property rights issues, among others.

In a disastrous move, government recently listed 23 white-owned commercial farms it has targeted for confiscation as it prepares to take over the remaining white-owned farms.

While several African countries will be represented at ministerial level at the three-day Paydirt Africa Down Under Conference in Perth on September 2 to 4, Zimbabwe is sending a delegation of senior officials in the Ministry of Mines, led by deputy minister Fred Moyo. The Australians however prefer that Mines minister Walter Chidhakwa lead the delegation.

The conference, the world’s largest business forum on Africa outside the continent, is an annual event attended by African mines ministers and senior government officials and Australian mining executives, business leaders from the mining service industry, financiers, bankers and brokers, senior government officials, investors and mining consultants. The most notable speaker at this year’s conference is Australia’s Foreign Affairs minister, Julie Bishop.

Last year, the conference attracted more than 1 500 delegates, including 22 African ministers of mines and more than 100 exhibitors.

Conference organisers indicated at the last conference that it is only those African countries with sound and consistent mineral policies and stable governments that would attract Australian interest in the future.

Australian ambassador to Zimbabwe Suzanne McCourt said on Wednesday: “Certainly, I see as one of my objectives as ambassador here is to encourage greater business links between our two countries.

“I met some Australian companies before I came here and they indicated that there is an ongoing interest particularly in the mining sector in Southern Africa. But also in relation to Zimbabwe, they were seeking greater policy clarity and I guess confidence assurances that they could have confidence that this could be a solid and good business investment climate in Zimbabwe.

“For an example the Zimbabwe government has itself identified that there are issues to do with ease of doing business and also the need to clarify some policies to make it a more attractive place for investment.”

The mining conference comes three months after Australian global mining giant, Rio Tinto Plc sold its diamond and coal mining assets in Zimbabwe to RZ Murowa Holdings, marking the withdrawal of one of the world’s iconic mining firms from the country after a 60-year presence.