THE indigenisation and empowerment policy, Zanu PF’s election trump card, may trigger an economic downturn due to lack of clarity and funding constraints political and economic, analysts contend.
Business Reporter
As Zimbabwe gears for harmomised elections set for July 31, political parties have crafted election manifestos to win the hearts of the electorate.
Zanu PF, which has been in power since independence in 1980, is optimistic that an empowerment policy compelling foreign-owned companes to sell 51% stakes to locals will catapult economic growth.
Zanu PF, according to the election manifesto $7,3 billion worth of equity, including through creation of employee share ownership schemes, would go to indigenous Zimbabweans through transfer of 51% shareholding from foreign-owned firms to indigenous people creating a basis to leverage other opportunities.
Zanu-PF envisages Zimbabwe’s $10,9 billion economy growing by an average of 6% in the first year, 7,3% in the second year, 8% in the third year and 9% in the fourth and fifth years buoyed by the empowerment policy.
“Accordingly, the Zanu PF reform programme of indigenisation and people’s empowerment is the only meaningful, concrete and viable vehicle to mobilise critical resources that are meaningful and viable to finance the development of economic and social infrastructure and to finance the productive sectors of the economy to benefit everyone,” reads the Zanu PF election manifesto in part.
But analysts say that the policy may have a boomerang effect on the economy which has already taken a knock during the first quarter. Government estimates show that the economy could have contracted by nearly 3% due to political uncertainty.
- Chamisa under fire over US$120K donation
- Mavhunga puts DeMbare into Chibuku quarterfinals
- Pension funds bet on Cabora Bassa oilfields
- Councils defy govt fire tender directive
Keep Reading
Economic and political economist Brian Ngwenya described Zanu PF’s indigenisation thrust as populist and unsound.
“Zanu PF policy can be said it’s old wine in new skins because growth, development and employment creation has always been the Zanu PF campaign strategy since 1980. Corruption in the indigenisation of the market shows that little promise is there from the process, as a vehicle to transform Zimbabwe from economic woes,” he said.
John Robertson, an independent analyst based in Harare, said the Zanu PF manifesto would not stimulate economic growth.
“I believe they are entirely wrong by changing the ownership of existing assets will help them raise new money. I think it will not yield any return for future investments. They (Zanu PF) are incorrectly assessing the view of the population as no one will be empowered by indigenisation as an individual,” he said.
He said on the other hand, the MDC T manifesto was within reach if we restore the productive capacity of the economy. The Prime Minister Morgan Tsvangirai-led party plans to revive the economy through several measures anchored on attracting more foreign direct investment.
A local analyst who refused to be quoted for professional reasons said funding was the key to the success of the empowerment policy warning that if not managed well, foreign companies would end up fronting foreign shareholders widely perceived to be sympathetic to Zanu PF.
“It’s most likely that the funds will come from China or Iran. This means the Chinese will get 51% in Zimplats and considering our history of not paying back the 51% will be taken by China after we have failed to pay back the loan,” said the analyst.
The analyst said politicisation of State institutions, which Zanu PF says are key to driving economic growth, might also work against the party.
Renowned economist Godfrey Kanyenze said politicians should create a platform that allows people to participate in the economy rather than trying to carry people on their backs. Kanyenze said people should not read too much into political parties’ manifestos as they were trying to win their votes.
“We want a politician who doesn’t promise people anything, but who say to the people let’s do it together. We need a politician who creates an environment that allows me to do my own thing. The government should be democratic and developmental; I don’t want to be carried at the back of someone. We are where we are because of politicians,” he said.
