Stanbic offers US$20m for youth projects

policy shift by the South African-owned bank.

Foreign-owned banks have for a long time been conservative in terms of supporting indigenous-owned businesses, which riled the Government.
Foreign banks have extended funding to various sectors of the economy, but in grossly disproportionate amounts to their deposits.
Youth Development, Indigenisation and Empowerment Minister Saviour Kasukuwere said the decision by Stanbic was a major boost for youth entrepreneurial activities.

But he said the “carrots” given by foreign-owned banks would not lead to the suspension of the indigenisation of their ownership.
Standard Bank Group of South Africa, a British banking conglomerate, has offered to localise 10 percent of Stanbic, but Government said that was not enough.

“They have written to me, making available a loan facility to support our young entrepreneurs to the tune of US$20 million,” said Minister Kasukuwere.
He said the modalities for the youth projects facility were being discussed between the bank and officials from his ministry and would be announced soon.

“My ministry will work closely with Stanbic in ensuring young people’s access to the funds and are properly skilled and prepared for the heavy responsibilities. Youths, irrespective of tribe, religion, creed or political persuasion, have unfettered access to the funds,” he said.

Minister Kasukuwere lamented the general reluctance by the banks to lend money. He pointed out he would continue discussions to localise their ownership.
“We have said to them the fact that you are giving us carrots does not change the law,” he said.

“If they had made that (10 percent) some five to seven years ago we wouldn’t be talking about indigenisation now,” he said.
“They (Standard Chartered and Barclays) said they would give workers 10 percent. Let them give the workers. We said implement, but we are headed for 51 percent. Carrots do not change the laws.”

But he said the gestures would make it easier for Government to discuss with firms showing a positive mindset to the indigenisation drive.
Minister Kasukuwere said this after meeting Mimosa Mining Company and chiefs from Zvishavane following the platinum mining firm’s decision to give local communities 10 percent as part of indigenising the firm.

Mimosa became the third largest foreign-owned mining company to give locals a 10 percent stake after Zimplats and Unki. Not all mining firms have submitted indigenisation plans to localise 51 percent, but almost all of them have agreed to localise at least 30 percent.

Minister Kasukuwere said locals, who have for years toiled as slaves, labourers and low-salaried workers, should now be in control of the economy. He said indigenisation would achieve total employment in the country.