German investors wary of indigenisation, says ambassador

Germany says that it is ready to do business with Zimbabwe but remains sceptical about the security of investments because of the country’s Indigenisation laws that have been blamed by economic analysts for scaring away foreign investors.

Zimbabwe’s Indigenisation policy compels foreign-owned firms with a minimum capital of $500,000 to cede 51 per cent of their shareholding to locals.

In an exclusive interview with The Zimbabwean, the German ambassador to Zimbabwe, Ulrich Klockner, bemoaned the lack of clarity and transparency regarding Zimbabwe’s indigenisation policy, saying that, as a result, German investors were developing cold feet as far as investing in Zimbabwe was concerned.

“On the economic side, we would like to get back into business with Zimbabwean companies, but at the present moment, we do not see the conditions for that. What we need is clarity, consistency and transparency in the application of the law and this is crucial not only for German businesses,” he said.

“We need to have confidence that our investments here are secure and also an environment where everybody is treated in the same way. But at the present moment, nobody knows what can happen to their investments especially with this Indigenisation policy,” said Klockner.

He said that the absence of foreign investment had had debilitating effects on Zimbabwe’s economic revival efforts.

“The messages we received from the finance minister (Patrick Chinamasa) were all the right ones but, unfortunately, we are seeing at the moment that most of the programmes he outlined are becoming quite difficult to implement. We just hope that things will go in the right direction,” said Klockner.

Zanu (PF)’s programmes, such as the ZimAsset economic blueprint launched by the party for the next five years, have failed to instil confidence in an economic revival, while the Look East policy has come under fire as well for failing to yield positive results.

Klockner, however, said that despite the impediments to German investment in Zimbabwe, his country remained committed to assisting in other sectors.

He said Germany was currently playing a role in helping improve Zimbabwe’s agricultural sector.

“We have water projects that are currently running in five cities, whereby we are helping repair the water lines and giving advice on how best to save water and distribute it. This is one of our main projects and we are also into agriculture.

“Under agriculture, we are mainly advising on how to improve the sector and we also have a lot of German non-governmental organizations here who are into development cooperation,” said Klockner.

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