LOCAL business groups and the country’s consumer watchdog have backed the recently announced statutory instrument barring foreign investors from setting up business with low capital outlays.
Nearly a fortnight ago, the government gazetted a new statutory instrument reserving several economic sectors for indigenes with effect from January next year.
Statutory Instrument (SI) 66 of 2013) bars foreigners from investing in retail, bakeries, grain milling, transportation (passenger buses, taxes and car hire services), barber shops, hair dressing and beauty salons, employment agencies, milk processing, and tobacco processing, among others.
The statutory instrument is anchored in the Indigenisation and Economic Empowerment Act compelling foreign-owned companies operating in the country to sell controlling stakes to locals.
Zimbabwe National Chamber of Commerce president Oswald Binha said the move by the government to reserve some sectors of the economy was long overdue.
He said it should have been implemented after the enactment of the indigenisation and empowerment law.
“We can’t have foreigners set up corner shops to sell electric plugs. We can’t have the Chinese fly all the way from China to sell buns. Is that the investment certificate that they got from Zimbabwe Investment Authority? So now, we need to see how best government will operationalise that,” said Binha.
Binha, however, said the government should exercise caution in the implementation of the SI to avoid instability.
“As much as we don’t want to destabilise the economy, we welcome the move and we are behind the government in implementing it. We must reflect that we are an educated nation, so we do it in a manner that does not cause chaos. We are happy that the SI is now in place, but now we need to see the modalities of rolling it out,” he said.
According to the Indigenisation and Economic Empowerment Act, an “indigenous Zimbabwean” is defined as any person who, before Independence in 1980, was disadvantaged by unfair discrimination on the grounds of his or her race, and any descendant of such person, and also includes any company, association, syndicate or partnership of which indigenous Zimbabweans form the majority of the members or hold the controlling interest.
Consumer Council of Zimbabwe executive director Rosemary Siyachitema said the move by the government was noble.
“It’s good to empower the local people as this will result in employment creation, promotion of local businesses, improvement of consumer buying power and will also improve money circulation,” said Siyachitema.
She said the circulation of money locally would improve as this will promote local businesses in Zimbabwe.
The Grain Millers’ Association of Zimbabwe president Tafadzwa Musarara said the milling industry supports the empowerment of previously disadvantaged Zimbabweans. “We are grateful on the provisions that allow individual milling companies to make their specific compliance plan with minister Saviour Kasukuwere taking cognisance of the capitalisation of companies through leveraging equity,” said Musarara.