Business, mines must stand up to Kasukuwere: RAU

Forcing companies to comply with the Indigenization Act is illegal. But many are complying because they have no confidence in the judicial system, according to the Research and Advocacy Unit.


Big businesses are scared of the precedent set by the jambanja that accompanied the land “reform” exercise, and Zanu (PF)’s threats to employ similar tactics to gain control of mining and industry.

RAU researcher Derek Matyszak said Zanu (PF) was misinterpreting the law in order to gain currency ahead of elections.

He blamed the media and the MDC formations for not highlighting the correct meaning of the law, and said it was being misinterpreted to benefit party supporters who are silent as to how the cash-strapped government will be able to pay for the shares owned by shareholders.

“Minister SaviorKasukuwere’s false statements about the requirements of the indigenization legislation have gone largely unchallenged by business, the media, and the MDC formations. As a result, he appears to have gained the impression that he can make the rules to be followed, rather than the Act and the Regulations,” said Matyszak.

While the companies themselves are aware of the limitations of the law, which has divided the Government of National Unity, they are too scared to challenge Zanu (PF) as it still controls the most influential posts in government and the security sector.

“The political terrain is such that no company will risk being singled out and run the risk of reprisal. It also indicates that the legal system is such that companies have no confidence that they will be protected from unlawful reprisals, or that the courts will implement the law provided for and allowed by Zimbabwe’s legislation and constitution,” noted RAU.

“The absence of any protection by the judicial system during the violent land invasions after 2000 is an intimidating precedent informing the response of business to the manner in which government is implementing the indigenization programme,” said Matyszak.

RAU advised companies not to be cowed into following the whims of Kasukuwere and striking private deals with him, but rather to enter into deals of substance in accordance with the law.

Economists have highlighted the disastrous effects of the legislation and its interpretation by Kasukuwere on investment.

Finance Minister TendaiBiti, a lawyer by profession, confirmed that Kasukuwere was misinterpreting the law. “The Act does not say that every foreign-owned company shall be 51%-owned by indigenous people. It says it is the intention to reach the destination of 51% ownership, so it’s discretionary. A peremptory interpretation is therefore wrong.

“This act has been misinterpreted. Section 3 says it shall be the endeavour of government to ensure that every company in Zimbabwe that is foreign-owned is at least 51%-owned locally. The word endeavour denotes an intention. So the provision is not worded in peremptory language,” said Biti.

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