THE government has made a major climb-down on its Indigenisation policy, announcing Monday key changes to the controversial law which critics say blocks foreign direct investment (FDI) in the crippled economy.
Finance Minister Patrick Chinamasa, Reserve Bank Governor John Mangudya Youth, Indigenisation and Economic Empowerment minister Patrick Zhuwao confirmed the changes to the policy at a joint press conference in Harare on Monday.
The policy forces foreign investors to localise control and ownership of at least 51 percent of their Zimbabwe operations.
But among some of the changes under the new regulations, companies will be given up to five years to comply with the 51 percent threshold and the latitude which could be relaxed for up to 20 years.
Companies will also be allowed to apply for a further grace period of up to 20 years after the five years.
In addition, government will now only pursue indigenisation through state enterprises and not allow individuals to capitalise on the policy for self-enrichment.
“We have agreed on the Frameworks, Procedures and Guidelines for Implementing the Act and as we move forward emphasis is now on implementation of the Indigenisation Law starting with the submission of the indigenisation implementation plans which every affected company must submit with immediate effect but no later than March 31,” said Zhuwao.
Chinamasa said the new frameworks would replace those he gazetted on December 24 adding that they were now a better document, which he was prepared to land his weight.
“That’s why I am here,” he said.
“In this matter there has been robust debate… following this robust debate we have now come out with a much improved product, which is very conducive for investment. So I want us to consider the frameworks as a milestone in the turnaround of our economy.”Advertisement