FOREIGNERS operating in the reserve sector have to find local partners to comply with the indigenisation law, Youth, Indigenisation and Economic Empowerment minister Patrick Zhuwao has said.
BY VICTORIA MTOMBA
The Indigenisation Act stipulates that at least 51% shareholding in foreign-owned companies operating in Zimbabwe should be in the hands of locals.
According to the frameworks, procedures and guidelines for implementing the Indigenisation and Economic Empowerment Act, no non-indigenous businesses will be allowed to invest in the reserve sector unless under special cases as determined by the line ministries or approved by Cabinet.
“Companies that are operating in the reserve sectors currently must comply with indigenisation. There are two things here.
There are companies in some instances that are 100% non-indigenous, they must comply with the minimum 51%.There are companies that are in the reserve sectors and are non-indigenous, they have to find a way of identifying with the indigenisation law either tying up with someone in the sector, that on a personal level,” Zhuwao said at a breakfast meeting in Harare yesterday.
The reserve sectors include agriculture, milk processing, bakeries, retail and wholesale, barbershops, hairdressing and salons, employment agencies, estate agencies, transport and grain milling, among others.
Zhuwao said companies had a first quarter deadline to submit their indigenisation plans, adding that there would be deeper conversations with the line ministries.
Zhuwao proposed a 10% empowerment levy which he said would have to be approved by Cabinet.
“I cannot say when the process will be complete.But I would have wanted by the end of the first quarter to be done with the process,” he said.
The levy will go to the National Indigenisation and Economic Empowerment Board to fund start-up, research and new proposals.
The Indigenisation Act came into being in 1998 and was revised in 2004.