Sunday, 13 December 2015

Indigenisation laws to be enforced from January 2016, insists Mugabe - the economic will sink even deeper faster!

Mugabe tells his Zanu PF conference delegates, the ruling elite who stand to be economically empowered by buying shares from foreign owned business, his regime will start forcing companies to comply with the indigenisation laws.

"Come January and its 2016, that stubbornness and resistance we say should end in 2015…2016, we will not accept a company which refuses and rejects our policy of indigenisation and empowerment."

The trouble with tyrants like Mugabe, who are not accountable to anyone and so they never listen to anyone, is that they see what is not there and then plough on regardless.

In 2008, Mugabe passed his new indigenisation laws designed to “economically empower” blacks by forcing foreign owned companies, both existing and new, to sell as much as 51% of their shares to local black Zimbabweans. It should be said here that companies will economically empower the local people is which they operate in three ways:

1)    Companies pay tax, levies, etc. to central government or local governments and the money is then used to build roads, schools, hospitals, etc. In a country whose revenue base has been shrinking to the point where 83% of the collected revenue going into paying wages when the norm should be half that; increasing the revenue is very important.  

2)    Companies create employment opportunities for locals directly or indirectly. Unemployment in 2008, when the indigenisation laws were passed, was 90%; it dropped to 80% during the GNU but has surged up again to 90% plus today.

3)    Companies can sell company shares on the stock exchange or directly to individuals. Only Mugabe cronies could ever hope to buy these shares just as it was them who benefited from the white farm seizures which inspired the indigenisation laws.

Mugabe’s indigenisation laws are primarily targeting foreign own companies and force them to sell shares to local individuals regardless of whether they wanted any local partner or not needed to raise additional funds or not. The law stipulates that government or some authority will approve the deal and, it is common knowledge that, means the regime will appoint the local partner.  This is what has made these laws so obnoxious and unacceptable; who would want to be forced to have a business partner they never asked for!

The economic reality is that since the passing of the indigenisation laws Direct Foreign Investment (DFI) has dries up. Zimbabwe has as little as 4% of the DFI Mozambique received in 2012. Existing companies have continued to close, especially since the rigged 2013 elections when it was clear the return of Zanu PF will mean the return of such oppressive laws like indigenisation laws.

If Zimbabwe had been a healthy and functioning democracy then Mugabe will have got the message loudly and clearly by now: the indigenisation laws have scarred away DFI and the price the nation has paid in lost revenue and employment opportunities is unacceptably high particularly when the laws is nothing more than the ruling elite holding the nation to ransom.

But Zimbabwe is not a democracy and so Mugabe is not even concerned that millions are out of work and million now live in total abject poverty the ruling elite will holdout with their demand of forcing foreigners to sell shares to his cronies even if even more of the few remaining companies are forced to close down. So Mugabe will force the implementation of the indigenisation laws forcing taxes and revenue to drop even further, unemployment and economic meltdown to get even worse for the sake of a handful of his cronies who will be empowered by buying the very few shares from the tiny number of foreign owned companies still remaining in the country.  

Some people have been hoping that Mugabe and Zanu PF can be talked into scrapping its obnoxious indigenisation laws, end corruption, etc. this ultimatum as to when the laws must be ruthlessly applies has put those hopes to bed. There will never be any meaningful economic reforms without the political reforms designed to restore the people’s power to hold Mugabe or whoever is elected to form the next government accountable to them.

We need to implement all the democratic reforms agreed in the 2008 GPA and then hold free and fair elections! 


Zimbabwe Light said...

But Mugabe, in his speech to officially close the conference yesterday, seemed to pour cold water at the plot, describing any thoughts of leadership change as "dreams".

"We all had our thoughts of what was going to happen at this conference. Some said there would be chaos, fights and violence. Some said there would be thugs planted to cause confusion," Mugabe said.

"Some even said there would be changes to the leadership. That was a dream maybe driven by fear, but that is all gone. We are now working together, the leadership smiling and committed to the resolutions of the party."

The infighting in the party will continue as if the conference never happened; this is Zanu PF a party of thugs, they will never stop fighting until they get what they want.

Zimbabwe Light said...

Mugabe rigged the 2008 elections and even SADC and AU said they were not free and fair he said they were free and fair. Like all tyrants he will never accept doing anything wrong! He has blamed sanctions for his own misrule, we know he is lying and the truth is starting to come out already.

Zimbabwe Light said...

@ Patrick

It is a great pity a great pity that we have never had a healthy free media, including print, radio and TV and freedom of expression in Zimbabwe. I believe there are many war vets out there who would have voiced their objection of all these Mugabe shenanigans years ago if they had been given a platform. There are ordinary Zimbabweans who too would have voiced their objections to the regimes autocratic rule if only we had a free media.

One of the key democratic reforms in the 2008 GPA was reform of the media. It is a great pity that the sum total of Tsvangirai’s need for a free media was to demand the Zanu PF control public media must stop calling him a puppet. They did for a few weeks and then it was business as usual.

Implementing the media reforms must be top of the list when the nation finally comes to implementing the GPA reforms. It will be like open a window to let in the light of knowledge and the life giving fresh air into a room where the oxygen level had dropped to dangerous levels.

People like Sibanda, Mliswa, Chinos, Mutsvangwa, etc. have the dzakutsaku mentality – they are paid thugs they will work for whoever will pay them regardless of cause and how innocent their victims happen to be. Mliswa is calling on the thugs to unite and form the Zimbabwe Union of Rogue War Vets (ZURWV) so they can demand better pay and better working conditions in future. ZURWV members will work for Mnangagwa, Mujuru, Mugabe or Tsvangirai it does not matter; Mliswa and Sibanda have already replace their Zanu PF regalia with MDC-T regalia and will, no doubt, hunt down Zanu PF supporters with the same ruthlessness they hunted MDC supporters in the past!