HomeLocal NewsMines majority stake drive nearly complete

Mines majority stake drive nearly complete

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JOHANNESBURG — Indigenisation minister Saviour Kasukuwere expects to finalise the transfer of majority stakes in foreign mining firms to local black investors by the end of this month.

Kasukuwere has been the “enforcer-in-chief” of a controversial law that requires foreign firms to hand over 51% of their holdings in the country to black investors.

“With the mining sector, I am pretty certain that by the end of April, we must have dusted and completed the transactions that have already been agreed to,” Kasukuwere told the Reuters Africa Investment Summit in South Africa yesterday.

“I would say in the main there has now been compliance and now it’s just a question of dotting the Is and crossing the Ts.”

Kasukuwere remained vague about the policy’s details or how it would be funded. He said only $10 million had been allocated for it in the National Budget this year, a fraction of what the stakes would cost. And he gave no indication that the government planned to pay for any stakes in Zimplats, the Zimbabwe unit of Johannesburg-listed Impala Platinum, the world’s second-largest platinum producer.

“We are at a delicate stage now in terms of the conclusion of the Implats agreement . . . What I can clearly state here is that we are taking into account the sovereign rights of our people to the resources. That is a key factor in the computation of the final agreement,” he said.

“The right to operate is granted by the people of Zimbabwe, by the country — that is the sovereign ownership. So the right to mine must be taken into account.”

Implats outgoing CEO David Brown and Kasukuwere were for months locked in a bitter war of words and while they publicly buried the hatchet in March, the details of their final settlement remain a mystery. Implats has said it will comply by ceding 20% to local communities and employees and by selling 31% to the government for its National Indigenisation and Economic Empowerment Fund.
But it has been adamant the State will pay. At its current share price, a 31% chunk of Zimplats would be worth around $350 million or 35 times the amount the government has in its budget for such purposes.

Kasukuwere said there was a proposal to bring in a tax to help fund the programme and said it was not akin to nationalisation as the local private sector was also raising money to buy stakes.

“People thought we were going to wake up overnight and start grabbing these companies. We’ve not done that,” he said.

“We are not saying to the private sector: Don’t become involved. So people are sitting down and structuring these deals through vendor financing, borrowing . . . commercial banks, collective groupings coming together to acquire stakes.”

Unlike the seizure of white-owned farms for redistribution to black Zimbabweans launched over a decade ago, Kasukuwere said no company had been grabbed under the banner of this policy.

“There’s not been any compulsory acquisition of a business in Zimbabwe. All that businesses have done themselves is comply with the laws of our country,” he said.

“Everybody expected us to carry out this indigenisation process in a very chaotic manner
. . . We will follow the laws of our country.”
Resource-rich Zimbabwe has the world’s second-largest known platinum reserves after neighbouring South Africa and also has lucrative gold and diamond deposits.

Foreign miners operating there include Anglo American Platinum, the world’s number one producer of the precious metal, Rio Tinto and Mwana Africa. — Reuters

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