Indigenisation: Vote buying gimmick

January 5, 2012 at 1:17 pm Leave a comment

HARARE – With President Robert Mugabe harping on about early elections, possibly this year; the indigenisation project is likely to be implemented with much more vigour this year.

Having exhausted the land reform programme as a vote buying tool, Mugabe has little room to manoeuvre except to target privately owned firms, particularly those belonging to whites and foreign corporates for expropriation.

Like the farms, Mugabe is hoping redistribution of such wealth to cronies will endear him to the electorate.

Little wonder therefore, that the indigenisation programme has gained momentum only now since the law was passed in 2008, just before elections that ended Mugabe’s dominance of Parliament.

It is election time again, and this year, we expect the indigenisation project to be the talking point. Despite grabbing white-owned land for redistribution to landless blacks, Mugabe and his party still went to lose the 2008 election.

Yet, that history appears to have failed to teach Mugabe any lessons.

Most dangerous in the whole saga is hawkish young minister, Saviour Kasukuwere, whose reckless talk and often times — implementation of the indigenisation law has caused many an investor to think twice before heading towards Zimbabwe.

There is still room to implement the indigenisation law in a sober, viable manner.

A typical example is Government and Indian steel firm Essar’s $750m partnership at the former Ziscosteel.

The fact that Essar got majority shareholding, 54 percent, in the former state-controlled iron ore mining and steel production venture is a clear indication that a rational approach to indigenisation is achievable.

Empowerment of locals is key to every economy, but it should be known to every policy architect and implementation department that correcting the wrongs of over a century cannot be done overnight otherwise we risk ending up in a worse situation.

Clearly, there is need for the Executive to put a leash on ministers such as Kasukuwere, so that he abandons his militant approach in implementing the controversial policy in typical fast-track land reform style. Otherwise Zimbabwe will continue to scare away investors.

Foreign investors are in a wait and see mode as Kasukuwere proceeds with making sure that at least 51 percent of all foreign-owned firms is relinquished to black locals through various means.

The international community is obviously also watching how the Essar deal will proceed.

There could still be some hope. But certainly, with men like Kasukuwere in charge of key ministries, caution remains the word.

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