HomeOpinion & AnalysisColumnistsStop Kasukuwere’s gunboat diplomacy

Stop Kasukuwere’s gunboat diplomacy

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Empowerment minister Saviour Kasukuwere is at it again, threatening to compel foreign banks to relinquish equity to locals as part of the indigenisation crusade the Zanu PF component of the inclusive government has embarked on as its last election trump card.

Kasukuwere was quoted in the State media on Sunday saying his ministry was crafting legislation spelling out how foreign banks, Barclays Bank, Standard Chartered Bank and Stanbic, would relinquish some of their shareholdings to indigenes.

The minister said he was working with Finance minister Tendai Biti on this latest economically ruinous project.

He said: “As it stands, we have already established the binding instruments for some key sectors such as manufacturing and mining.

“We feel that it is prudent to have similar instruments for the banking sector.” In the same vein, Kasukuwere claimed to be engaged in negotiations with the banks to come up with a win-win solution.

Is this not hypocrisy and gunboat diplomacy? Such kind of behaviour is ruinous and must be stopped.

There is absolutely nothing wrong with economic indigenisation and black empowerment for as long as it is well thought out and designed to broaden the participation of the citizens in the country’s economic growth, or recovery in the case of Zimbabwe.

But the plot is completely lost if the programme is deliberately fashioned solely to buy political support at the expense of economic recovery, social development, job creation and foreign direct investment, among others.

It defies logic for Kasukuwere to target foreign banks for indigenisation at this particular moment when the country is facing a debilitating liquidity crunch that already threatens several indigenous banks with collapse if the matter is not handled with the prudence and the urgency it deserves.

After all, Zimbabwe’s banking sector is almost fully indigenised. Out of the 25 banks, less than five are foreign-owned.

Kasukuwere should not erode the little confidence Zimbabweans still have in the banking sector by this kind of brinkmanship and reckless statements about the financial services sector that is almost on its knees. He needs to tread carefully when it comes to banks.

The banking sector is crying for stability. Most Zimbabweans have lost confidence in our economy to an extent that very few – in the country and abroad — are still prepared to invest in the local economy to boost production and enhance exports.

The country has been reduced to a big wholesale of imports, which mops up the little liquidity in the economy and takes it abroad.

We have become a trader’s market hence the liquidity crisis and the more reason we cannot afford to antagonise foreign banks at the moment.

Reserve Bank of Zimbabwe governor Gideon Gono and Biti have in the past three weeks told the nation that foreign banks are holding on to plus $400 million in their offshore accounts.

There is nothing illegal about keeping the money in those accounts at all – they are simply keeping safe depositors’ money.

So, instead of threatening banks, Kasukuwere and his colleagues in government and his party, must engage the banks and persuade them to inject the money into circulation and improve liquidity.

Negotiations should centre on how the banks can lend to the productive sectors of the economy to enhance productivity that would ultimately result in more exports.

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