Zimbabwe will shut down foreign-owned companies on April 1 if they don’t comply with a law that requires them to sell or cede 51% of their shares to black Zimbabweans, Indigenisation Minister Patrick Zhuwao said.
“Comply by that date or close shop, comply by that date or face the full wrath of the law,” Zhuwao told reporters Wednesday in the capital, Harare.
The announcement by Zhuwao, President Robert Mugabe’s nephew, appeared to end a debate within the cabinet over the scope of the empowerment law, which was passed in 2010 and applies to foreign-owned and white-owned companies. While foreign mining companies had to cede a 51% stake to black Zimbabwe, Finance Minister Patrick Chinamasa suggested two years ago that the percentage might be changed for other industries.
The International Monetary Fund urged Mugabe’s administration this month to clarify its policy on black empowerment. Zimbabwe, which sits on the world’s second-biggest deposits of chrome and platinum after South Africa, has said it will repay at least $1.8 billion in debt to the IMF and other multilateral lenders by the end of June as part of its effort to re-engage with the Washington-based fund and to be able to obtain fresh loans.
Mining companies active in the country include Impala Platinum Holdings and Anglo American Platinum.
Credit: Money Web