Workers protest highlights flaw of Indigenisation policy

Local businesses that take over companies through the Indigenisation Act will have difficulties running them, unless the government provides them with the necessary support an analyst has said.

The comments were made following a demonstration by workers because their new owner was failing to pay them or run the company properly.

On Thursday it was reported that workers from a branch of Jaggers Wholesalers in Harare stormed ZANU PF headquarters to protest against the governments indigenisation policy that has left them without work or pay for months. Robert Mugabes party has been championing the policy, despite criticism from both inside and outside the country that it will only put off investors and damage Zimbabwes ailing economy.

Jaggers is now owned by businessman Cecil Muderede, an indigenous Zimbabwean who took over the wholesaler last year, reportedly because of the controversial indigenisation policy.

On Monday economic commentator Bekithemba Mhlanga said the case of Jaggers shows that businesses are being verbally encouraged to take over companies but not been given the technical and financial support, which results in the businesses failing.

They could have had the moral support to say Go ahead and nothing will happen to you, without saying If you are going to take over Jaggers here are the accountants, the analysts, the business administration and here is a bank account, he explained, I doubt if they are getting that kind of support they are just getting moral support.

There are so many processes, so many systems, people issues to manage and a person wakes up in the morning and says, Look, I cant do this and the whole thing falls apart, Mhlanga said.

However despite these shortfalls ZANU PF has forged ahead with its support for the implementation of the Act, to the point of openly saying it will be used to punish foreign owned companies in the country.

Two weeks ago Defence Minister Emmerson Mnangagwa, who is tipped to be Mugabes successor, reportedly told supporters at a rally that heads of foreign firms could be forced to go on radio to publicly denounce what he called western sanctions or face losing 90% of their company shareholding.

Mnangagwas remarks came after Mugabe declared last month that unless the targeted sanctions are removed, the government would use the Act to take away 100% shareholding of foreign ownership.

The targeted sanctions have been slapped on Mugabe and his inner circle for human rights abuses.

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