The Indigenisation and Economic Empowerment legislation which came into effect last week provides the rules and regulations that guide the economic empowerment of the communities and other special and disadvantaged groups such as youths, women, workers and war veterans. Among other things, the Indigenisation and Economic agenda seeks to have a 51 per cent indigenous shareholding in major and strategic companies and develop a broad-based domestic private sector which is critical to economic growth and development. To get clarity on aspects of this agenda, Anthony Jongwe (AJ) caught up with the custodian of the indigenisation and economic empowerment agenda in the inclusive government Minister Saviour Kasukuwere (SK) and the following is their discussion.
AJ: Good morning minister. The Indigenisation and Economic Empowerment Act is now operational. Could you please shed some light on how the processes (indigenisation and economic empowerment) will unravel going forward?
SK: Good morning Jongwe. As you have rightly pointed, the implementation of the legislation has started. Within the next 45 days, companies will be expected to complete the relevant forms. As a Ministry, we are putting in place adequate measures to ensure that these forms are readily available and that includes the option of downloading them from our website. The forms seek to elicit information pertaining to the current set-up obtaining in each relevant company. It is hoped that the information obtained will reflect the correct level of ownership. As a ministry, we intend to use the information to come up with comprehensive sector-by-sector plans on how best to enhance empowerment. The whole purpose of this initiative is to broaden the national cake by bringing more people into national economic participation and development.
AJ: But there are serious concerns about the timing of the whole process, minister.
SK: It is the same old argument used when we introduced the highly successful land reform programme
AJ: Another school of thought is arguing that this legislation is largely motivated by ZANU- PF’s need to have a strong bargaining weapon in the on-going sanctions issue since there was no unanimity on the need for the legislation in the inclusive government.
SK: It’s all nonsensical. Our approach to indigenisation is not a new phenomenon. We have always been clear on the need to empower the sons and daughters of Zimbabwe in the face of irrefutable historical imbalances created by colonialism. Almost three decades after the attainment of independence, the ownership of resources in most key sectors of the economy is still skewed in favour of foreigners, with indigenous Zimbabweans mainly employed as managers and workers. Recent assessment studies on the levels of indigenisation of the economy by Government reveal that critical sectors of the economy, notably manufacturing, mining, tourism, energy, financial, construction, transport and media production are still dominated by foreigners. This state of affairs is detrimental to the overall development of the economy and prosperity of indigenous Zimbabweans
AJ: Indigenisation and empowerment programmes are not new in Southern Africa. What is unique about Zimbabwe’s approach?
SK: You are correct Jongwe. Indeed, South Africa, Namibia and Botswana have all adopted and implemented indigenisation programmes. Our approach to indigenisation is based on the notion of broad-based participation by our people in indigenisation arrangements. As a resource-based economy, we need to use indigenisation to fight poverty and create more jobs. Our indigenisation and empowerment are anchored on the conviction that indigenous Zimbabweans must own and primarily benefit from the exploitation and utilization of their God given natural resources. This is a fundamental pre-requisite for sustainable economic growth, social and political stability and overall national development
AJ: How will these broad-based participation arrangements be funded?
SK: There are various structures critical to the successful implantation of the indigenisation and economic empowerment agenda. The National Indigenisation and Economic Empowerment Fund (arising from the transformation of the National Investment Trust) will provide loans for acquisition of shares, business start-up, rehabilitation and expansion. Another route will be listing on the Zimbabwe Stock Exchange. Listing on the bourse enables ordinary black Zimbabweans to acquire shareholding in listed companies.
AJ: How can employees participate in the indigenisation programme?
SK: Workers will be able to do so through Employee Share Ownership Programmes (ESOPS). These programmes shall enable employees of a company, through a Trust, to acquire, hold and manage a prescribed level of shares of the company concerned and receive dividends or incoming arising there from. Significantly, ESOPS will result in increased productivity, improved industrial relations and employee welfare, retirement security, and foster responsibility and commitment to the company by employees and reduce demand on social responsibility. In conclusion, let me say that the difference between rich and poor is opportunity. These broad-based participation arrangements give an opportunity to all Zimbabweans, including those in the Diaspora to create wealth for themselves, families and nation.
Anthony is principal consultant at Global Workforce Solutions (Pvt) Ltd- a management and human resources consulting company. For feedback/enquiries, send e-mail to: email@example.com or phone/sms on 073 3 306 193