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Pamela Shumba, Senior Reporter
ECONOMISTS have commended President Robert Mugabe’s clarification of the indigenisation policy, saying it would help boost investor confidence in the government’s drive to revive the country’s economy.
President Mugabe this week provided clarity on confusion surrounding interpretation of the indigenisation policy, which he said had undermined investor confidence and further led to an increase in the cost of doing business and weakening the country’s competitiveness.
The presidential clarity also put to rest squabbles between Finance and Economic Development Minister Patrick Chinamasa and Youth, Indigenisation and Economic Empowerment Minister Patrick Zhuwao over enforcement of the law in the financial services sector.
Confederation of Zimbabwe Industries (CZI) president Busisa Moyo said President Mugabe demonstrated leadership consistent with the 10-Point Plan he enunciated last year in which attracting foreign direct investment is key.
“He has also highlighted the important issue of building investor confidence in reviving the economy. The announcement balances the need for empowerment with our immediate need for economic emergence and employment creation,” said Moyo.
“The private sector can now go back to seeking partnerships for projects with renewed clarity and focus on creating employment on a level scale.”
Moyo, who is also chief executive officer of United Refineries Limited, said being an investor friendly country with a dynamic legal environment sensitive to present priorities and realities would give Zimbabwe a fighting chance at attracting investment, creating employment and raising the output per capita.
He said the country needs funding for significant indigenisation programmes that will benefit ordinary citizens.
“What Zimbabwe needs is significant funding for significant programmes, companies and other private sector programmes. These will produce sustainable economic dividends and fruits.
“Getting a quick ‘boon’ that lasts a few months isn’t what we need. We must build scale and make a significant impact on a broader based spectrum as opposed to a narrow sector of society that’s already privileged,” said Moyo.
Davison Gomo, an economist, said the President’s clarification would definitely clear the confusion.
“There was a lot of confusion among ministries and people were taking conflicting positions that were frustrating the indigenisation policy. It was very important for the President to clarify the issues around indigenisation,” said Gomo.
“He clarified the policy in a sensible way that will definitely improve the country’s economy. Now that the President has cleared the confusion, ministries can implement the policy as it is, instead of creating their own policies,” he said.
Gomo said there was a need for further clarification on how locals will benefit from indigenisation.
“Ordinary Zimbabweans need to see how they can fit into the indigenisation programmes (and) the government has to see how it happens,” he said.
Bankers Association of Zimbabwe (BAZ) president Sam Malaba also commended President Mugabe’s clarification, saying it gives investors assurance.
“It was a positive clarification. Investors can now decide to invest in the country based on accurate information,” said Malaba.
President Mugabe said the banking sector would continue to be under the auspices of the Banking Act, which is regulated by the Reserve Bank of Zimbabwe (RBZ), while the insurance sector will be guided by the Provident and Insurance Act.
He said the position was essential for the promotion of financial sector stability, confidence and financial inclusion.
These institutions will, nonetheless, be expected to make their contributions by way of financing facilities for key economic sectors and projects, employee share ownership schemes, linkage programmes and such other financial empowerment facilities introduced by the RBZ from time to time.
The President also said businesses under the reserved sectors category were exclusively for Zimbabwean entrepreneurs, except for existing ones, whereby a special dispensation was granted by the line minister.
The clarification limits the role of the Youth, Indigenisation and Economic Empowerment Ministry by allowing line ministries to come up with their own models of compliance.
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