Home » Industry » Change Indigenisation Law, IMF Tells Zim

THE International Monetary Fund (IMF) has aised Zimbabwe to revise its indigenisation laws, attract foreign direct investment and generate money to pay off its debt, ruling out any possibilities of pardoning financially imprudent Harare.

The multilateral institution said although there were alternatives to eradicating Zimbabwe’s debt, they were not going to give any relief to the economically ailing Southern African nation.

“Improve the investment climate so that it becomes favorable to the private sector. How? By clarifying the contents of the indigenisation laws,” IMF head of mission Domenico Fanizza told delegates gathered at a press briefing Monday evening in Harare.

The black empowerment laws which give majority stake to locals in foreign business ventures have been contested since their enactment in 2007.

Economists have argued that the laws were not only racial but were also driving away potential foreign investors who found the measures threatening.

ZANU (PF) has been using these laws to threaten the few remaining white investors.

There is also no consensus among the government ministers on how these laws should be implemented.

Fanizza added:

“Also, a government support for a strategy to clear arrears with multilateral institutions and efforts should be deployed in order to gather consensus on this regard”.

Finance Minister Patrick Chinamasa, at the event, bowed to the IMF’s demands and said that the controversial black empowerment laws were being reviewed with the view of attracting investors.

“We are continuously clarifying our indigenisation policy and we will keep improving the ease of doing business environment. In fact, the Minister of Industry and Commerce is already engaged with this exercise,” he said.

Chinamasa claimed that they were also re-aligning the business laws with the new constitution so that they become modernized and attractive to foreign investment.

Zimbabwe, which has an external debt of $10 billion, wants the IMF to cancel the $124 million it owes the multilateral institution.

Harare is currently paying a monthly instalment of $150,000 as part of its debt repayment.

Source : New Zimbabwe