The goal is to ensure at least a 51% shareholding by indigenous black people in the majority of businesses. The bill completes a process that began with the controversial seizure of white-owned farms starting in 1999. Zimbabwe is currently experiencing the world’s highest inflation and shortages of food, fuel and foreign currency.
The bill still has to go to the upper house – the Senate – for final approval. It already has the support of President Robert Mugabe’s government. If passed in the Senate, the practical effect of the bill may, however, be severely limited, says the BBC’s Peter Biles in Johannesburg. Many foreign companies in Zimbabwe are already operating at a low level, with reduced turnover resulting from the seven-year economic crisis.
Critics have said the Indigenisation and Economic Empowerment Bill could hurt investor confidence in Zimbabwe. It stipulates that no company restructuring, merger or acquisition can be approved unless 51% of the firm goes to indigenous Zimbabweans. If we do not dismantle the structure of colonialism that we inherited then we have not given back all the country’s resources to its rightful owners.
The empowerment bill defines “indigenous Zimbabwean” as anyone disadvantaged by unfair discrimination on race grounds before independence in 1980. It also provides for the establishment of an empowerment fund which will offer assistance to the “financing of share acquisitions” from the public-owned firms or assist in “management buy-ins and buy-outs.” MPs from the governing Zanu-PF party supported the bill in parliament on Wednesday.
“If we do not dismantle the structure of colonialism that we inherited then we have not given back all the country’s resources to its rightful owners, who are our people,” Indigenisation and Economic Empowerment Minister Paul Mangwana said, quoted by Reuters news agency.
Members of the opposition Movement for Democratic Change (MDC) walked out of parliament in protest at the bill before voting began. “We see it as a strategy to amass wealth by the ruling elite, and nothing to do with the empowerment of people,” MDC spokesman Nelson Chamisa told the BBC News website. All government departments and statutory bodies will be asked to obtain 51% of their goods and services from businesses in which controlling interest is held by indigenous Zimbabweans.
Some firms dually listed on the Zimbabwe Stock Exchange and London Securities Exchange firms include Old Mutual, NMB bank and Hwange. Multi-national firms that may be affected by the new policy include Barclays Bank, Bindura Nickel Corporation and miner Rio Zim. Senior British officials say the Zimbabwean government will be disappointed if it thinks it will gain much of value from the move.