New Zimbabwe law: white-owned businesses to turn over control to blacks



author/source:Associated Press
published:Sun 9-Mar-2008
posted on this site:Mon 10-Mar-2008

Article Type : News



Angus Shaw

Harare - President Robert Mugabe has signed a new law requiring foreign-and white-owned businesses in Zimbabwe to hand over 51 per cent control of their operations to blacks. The new law is part of Mugabe's election campaign strategy of what he calls "economic empowerment." The strategy also includes plans to distribute tractors, generators, gasoline and cattle to black farmers who have resettled on white-owned land seized by the government since 2000. The moves comes three weeks before Zimbabweans vote in crucial presidential, parliamentary and local council elections. Mugabe, 84, is running against former finance minister and ruling party loyalist Simba Makoni, 57, and opposition leader Morgan Tsvangirai, 55. The March 29 vote takes place amid an economic meltdown - including a shrinking economy, rocketing inflation, shortages of most basic goods and collapsing public services - in a country once known as Africa's breadbasket.

Since the government began ordering the seizure of white-owned farms in 2000, production of food and agricultural exports has slumped drastically. Zimbabwe has the world's highest official rate of inflation: 100,500 per cent. One-third of the country's 12 million people received emergency food aid in January, according to UN agencies. The UN Food and Agriculture Organization predicted shortfalls in local harvests in coming weeks and said just 10 per cent of fertilizer needed in the last planting season is available to farmers. Since December, the Central Bank has spent at least US$43 million to import corn, Zimbabwe's staple food, from neighbouring countries, bank Gov. Gideon Gono said Saturday. The state-owned Sunday Mail said the new government program will put Zimbabwe "back at work" with state-of-the-art generators, buses, tractors, 300 buses, motorcycles and some 3,000 cattle.

"This equipment and implements now form a critical mass that should be deployed effectively so as to meaningfully uplift productivity levels," the newspaper quoted Mugabe as saying at a ceremony in Harare on Saturday. No details about the cost of the equipment - funded by the state central bank, much of it in scarce hard currency - was provided. In the past, similarly free equipment mainly has gone to supporters of the ruling party. Mugabe blames the crisis on economic sanctions imposed by Britain, Zimbabwe's former colonial power, and its allies, to protest his land reforms. "This hate program by Britain and her fellow racists imposed unjustified sanctions on Zimbabwe in futile attempts to frighten us off our land," he said. "They should remember we are not that easily scared away," he said. The Economic Empowerment Act requires "indigenous Zimbabweans" to hold a minimum 51 per cent stake in every business and public company, and to have a controlling stake in every investment or company merger.

Apparently the emperor is wearing his new clothes. What a dumb-ass.


Dutch

Dear Kathi:

Funny, that article could have been pulled from the pages of Atlas Shrugged by Ayn Rand.

Does Zimbabwe have refugees in neighboring countries? How soon until everybody leaves?

Sincerely,

Chris Bemis

That's because the land redistribution has worked so well!

In all honesty....does anyone, even the most liberal and uninformed morons in the US, believe this horse $hit? Zimbabwe's problems have never been the problem of the white man's....and I feel it's fair to claim that the MAJORITY of white Zimbabwean's have a far more acceptive attitude toward their fellow countrymen of color, than the other way around; most certainly those in power.
But then whitey's easy to blame when you have no other explaination to offer....right Bob?

Gary
DRSS
NRA Lifer
SCI
DSC

Obviously, it is the whiteys that make them stupid.

Only applies if you want to sell, merge, or aquire companies. Has no real impact on any safari operation.

I am sure that white owned farms in the first world produce most of food that Zim purchases.

He isn't called "Mad Bob" because he isn't...

"There have been a lot of mixed reports here, some saying that the bill did not pass through Parliament in the correct time frame and so has to start at the beginning of the process again. It will take a week or so for anyone to make sense of the situation surrounding the bill and whether it is in fact legitimate and then people will work out how to deal with it. Whatever the realities, it is about the last thing that he has got to campaign with and knowing how this country works there will be ways to deal with it or as we say, we will be able to make a ‘plan’. I am not too concerned at this stage but it does obviously have potentially devastating consequences if properly enforced. I will keep you posted."

I asked a friend of mine who is safari operator what it meant to him and the above is his response back to me today.

crl

This was going around about twelve years ago as well. Luckily it failed back then.

Mugabe nationalisation law surprises foreign businesses
Independent, UK

By Sean Farrell
Tuesday, 11 March 2008

British companies are seeking details of Zimbabwean legislation that would
enforce local ownership of their operations after Robert Mugabe, the
country's president, surprised observers by signing a Bill requiring them to
hand over control.

Many people had thought the Bill requiring foreign businesses to offer 51
per cent stakes to black Zimbabweans had lapsed. Mr Mugabe had left it
unsigned after it was passed by Parliament in September, but he signed it on
7 March.

UK companies operating in Zimbabwe include Barclays and Standard Chartered.
Both banks have been in the country for about 100 years.

Barclays said: "The implementation details of this law are still unclear.
Once further information is available we will assess it in more detail and
decide on what steps we should take." Barclays has 1,200 employees and
187,000 customers in the country.

Standard Chartered also said it was seeking clarification. Standard
Chartered has about 860 staff and 78,000 customers in Zimbabwe. The bank
wrote down the value of its Zimbabwe business in 2005. Other UK-listed
companies in Zimbabwe include the miners Rio Tinto and AngloAmerican, which
both said they had small operations there.

The Indigenisation and Economic Empowerment Act may not cover mines but of
greater concern would be the Mining and Minerals Amendment Bill, which has
not yet been passed by Parliament. It is understood that the legislation
would involve handing over a 25 per cent share to the Government as part of
putting 51 per cent in Zimbabwean hands. Companies might also have to pay
punitive royalties.

Rio Tinto employs more than 200 people in Zimbabwe where it has a small
diamond mine called Murowa. AngloAmerican has a platinum "project" which has
not yet been developed into a mine and employs about 400 people in the
country.

A Rio Tinto spokesman said: "Rio Tinto is supportive of a move towards
indigenisation provided it is done at the right pace and doesn't discourage
much-needed overseas investment in the Zimbabwean mining industry." The
Murowa mine is 22 per cent-owned by a Zimbabwe-controlled partner called
RioZim, he added.

Some observers believe Mr Mugabe may have signed the Bill as a gesture
because he is fighting a tough election battle with his former finance
minister, Simba Makoni. Zimbabwe goes to the polls later this month amid
widespread hunger, mass unemployment and 100,000 per cent inflation.

According to the press, Barclays Bank is being investigated for sanctions busting with regard to Zimbabwe and its reported that they've been supporting the Government to the tune of over UK£50M a year..... Now they might lose 51% of their business there.

Oh dear, what a pity, never mind!

After speaking with a friend of mine, a PH in Zim, he said that the new regulations will not effect sole proprieters operating in ZIM. This will protect for now most of the operations.

Shakari - You're right! I lie awake at nights worrying if barclays (or any other big bank for that matter) is making enough money

My heart bleeds for them....... just thing that they just might lose 51% of their shareholding.

anybody know what this BS does to the sugar cane operation in triangle??

Don't dismiss it...it's reality in South Africa already. How do you think all those guys who were pumping gas (or breaking rocks) ten years ago are now billionaires?