Mugabe's Campaign of Indigenisation Gains Pace

The world's second-largest platinum miner, Impala, last week agreed to cede 51 per cent of its Zimbabwean arm, Zimplats, under Robert Mugabe’s indigenisation programme; the corporate version of the farm invasions which have seen white African farmers in Zimbabwe have their land taken off them, often violently, over the past decade.

In 1979, a policy of land redistribution was introduced to distribute arable land more equitably between the historically disenfranchised blacks and minority whites. In 2000, after Robert Mugabe, the incumbent President of Zimbabwe, commenced a policy of fast-track land redistribution which involved the forcible removal of white farmers, and often their workers, from their land. More recently, he has targeted the assets of commercial companies in the region, under the guise of ‘indigenisation’.

Last year, the Government of Zimbabwe requested that Zimplats submit an ‘Indigenisation Implementation Plan’ (“IIP”). According to an announcement published on the website of Zimplats, the company received a letter on 6 September 2011 from Saviour Kasukuwere, the Zimbabwean Minister of Youth Development, Indigenisation and Empowerment in which he advised that the company’s IIP did not meet the minimum requirements of the law and accordingly, he requested the Minister of Mines and Mining Development to cancel the company’s operating license.

Zimplats’ subsidiary, Zimbabwe Platinum Mines (Private) Limited responded by submitting a revised plan in November 2011. This plan was rejected on 22 February 2012 by Minister Kasukuwere.

On 24 February 2012 Zimplat’s Chief Executive Officer, Alex Mhembere, published an announcement on Zimplats’ website stating the following:

Zimplats is concerned to note the statement by the Minister that unless progress is made within 14 days to transfer the required shareholding (in lieu of the empowerment credits) to the National Indigenisation and Economic Empowerment Fund (“NIEEF”), enforcement mechanisms will be activated. The Minister also indicated that suitable compensation for the released ground would be considered.

Following a meeting between Minister Kasukuwere and the directors of Implats on 13 March 2012, a new IIP was agreed which was deemed to meet the minimum requirements of the Indigenisation and Economic Empowerment Act and Economic Empowerment Regulations of 2010, and which was acceptable in principle to the Government of Zimbabwe.

The agreement amounts to the transfer to the Zimbabwean Government of 51% shareholding in the operating subsidiary Zimbabwe Platinum Mines (Private) Limited, comprising 10% shareholding to community, 10% to employees and 31% to the National Indigenisation and Economic Empowerment Fund (NIEEF).

Minister Kasukuwere described the deal as a "historic moment for Zimbabwe and for the region" and called on black Africans to "reclaim their resources". The campaign to turn over white-owned companies to black Zimbabweans has seen Robert Mugabe’s popularity soar nationally.

However, the Movement for Democratic Change (MDC), the opposition party which in 2009 formed a power-sharing government with Robert Mugabe's Zimbabwe African National Union - Patriotic Front (Zanu-PF), sees the indigenisation wave as a feeding frenzy by ruling-party cronies that will deter foreign investors.

Meanwhile, party infighting has deflected attention from the agreement to move towards elections with a new constitution. The creation of any such new constitution now appears hazy against the contextual backdrop of Robert Mugabe’s re-emerging popularity.  

For further information:

How Mugabe won over Zimbabwe again The Independent

Zimplats Holdings Limited

Zimbabwean Farmer Takes on Mugabe  ICLB

Kathryn Hovington is a pupil barrister at 9 Bedford Row International