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AFTER years of economic decline the Zimbabwean economy finally turned the corner in 2009, registering a gross domestic product growth rate of 5.98% against a negative growth rate of 17.67% in 2008.
In the next two years things looked even better, with GDP growth rates of 9.01% in 2010 and 9.3% in 2011.
The high growth rates or recovery, as some would like to call it, were however not for long as the government started implementing the indigenisation and economic empowerment law.
The law which came into effect on January 29 2010 rattled investors, resulting in what was at that time the biggest loss on the Zimbabwe Stock Exchange since dollarisation.
The benchmark industrial index lost a record 9.8% within a month after the law was gazetted.
The regulations - with the main objective of achieving 51% indigenous shareholding in existing businesses - sent investors into panic.
This turned the equities market into a seller's market, as investors began offloading their holdings in anticipation of a share price drop as companies rearranged their shareholding structure.
The then indigenisation minister, Saviour Kasukuwere, took a militant stand on the implementation of the law which sent shockwaves across the world every time he spoke about legislation.
Statements like “Those who don’t want to indigenise should do so at their own peril, and it is then at that time that they will realise that there’s a price to pay,” were the order of the day.
New broom in office
The aggressive stance on indigenisation seem to have changed with the advent of new Indigenisation Minister Francis Nhema.
The new minister - described by President Robert Mugabe as an introvert, as opposed to Kasukuwere who he deemed an extrovert - seems to have his own way of doing things.
Just last week he told delegates who attended the Confederation of Zimbabwe Industries conference in Bulawayo that although there was no going back on the law, a new mindset on how to implement it was needed.
Nhema said the programme will not be implemented in a “one size fits all approach”, adding there was a need to create a new mindset and saying the emphasis now should not be “go and take this (existing firms) but go and start your company”.
Interestingly, he is not the only government minister singing from the same hymn. The new Deputy Finance minister Samuel Undenge also said government is working on modifying the indigenisation law to provide flexible terms on capital projects, including those in the energy and water sectors.
Speaking at the same CZI congress, Undenge said government would consider a reprieve on capital projects which require close to $3bn to finance.
Change is in the air
The progressive song seem to be the same across the board, with more pronouncements pointing to the fact that government wants to create a conducive environment for investors.
Most government officials who spoke over the weekend pointed to a change in take in terms of government’s approach towards the economy.
There is even talk of compensating white commercial farmers, with Lands Minister Douglas Mombeshora saying government is mobilising funds to compensate former white commercial farmers for improvements they made on land that was repossessed under land reform.
Farm invasions are no longer tolerated, with the two Deputy Ministers of Agriculture Paddy Zhanda and Davis Marapira calling for a stop to renewed illegal farm invasions as they were disturbing agricultural productivity and contributing to food insecurity.
The mandatory blending of fuel which was supposed to start at the 5% level has now been approved to start at the 10% level by October 15. Energy Minister Dzikamai Mavhaire said the level should be 15% for November 31 and 20% by March 30 2014.
Zanu-PF officials are also calling on their president to make good his threat to fire underperforming ministers. Chris Mushohwe has implored Mugabe to crack the whip on non-performing public officials, saying the new Zanu-PF administration’s thrust was to deliver on key result areas such as revival of the industrial sector.
He said those entrusted with public offices should deliver or face expulsion, and urged the media to expose incompetent public officials.
Meanwhile, police commissioner general Augustine Chihuri is reported to have stepped in to rein in corrupt top police officers who had created Mafia-style operations to dupe people of their money and property.
This move comes after a police commissioner, Oliver Chibage, was fired last week amid allegations levelled against him by different people.
Is there a new dispensation in Zimbabwe? Only time will tell.
- Fin24
*Malcom Sharara is Fin24’s correspondent in Zimbabwe. Views expressed are his own.
In the next two years things looked even better, with GDP growth rates of 9.01% in 2010 and 9.3% in 2011.
The high growth rates or recovery, as some would like to call it, were however not for long as the government started implementing the indigenisation and economic empowerment law.
The law which came into effect on January 29 2010 rattled investors, resulting in what was at that time the biggest loss on the Zimbabwe Stock Exchange since dollarisation.
The benchmark industrial index lost a record 9.8% within a month after the law was gazetted.
The regulations - with the main objective of achieving 51% indigenous shareholding in existing businesses - sent investors into panic.
This turned the equities market into a seller's market, as investors began offloading their holdings in anticipation of a share price drop as companies rearranged their shareholding structure.
The then indigenisation minister, Saviour Kasukuwere, took a militant stand on the implementation of the law which sent shockwaves across the world every time he spoke about legislation.
Statements like “Those who don’t want to indigenise should do so at their own peril, and it is then at that time that they will realise that there’s a price to pay,” were the order of the day.
New broom in office
The aggressive stance on indigenisation seem to have changed with the advent of new Indigenisation Minister Francis Nhema.
The new minister - described by President Robert Mugabe as an introvert, as opposed to Kasukuwere who he deemed an extrovert - seems to have his own way of doing things.
Just last week he told delegates who attended the Confederation of Zimbabwe Industries conference in Bulawayo that although there was no going back on the law, a new mindset on how to implement it was needed.
Nhema said the programme will not be implemented in a “one size fits all approach”, adding there was a need to create a new mindset and saying the emphasis now should not be “go and take this (existing firms) but go and start your company”.
Interestingly, he is not the only government minister singing from the same hymn. The new Deputy Finance minister Samuel Undenge also said government is working on modifying the indigenisation law to provide flexible terms on capital projects, including those in the energy and water sectors.
Speaking at the same CZI congress, Undenge said government would consider a reprieve on capital projects which require close to $3bn to finance.
Change is in the air
The progressive song seem to be the same across the board, with more pronouncements pointing to the fact that government wants to create a conducive environment for investors.
Most government officials who spoke over the weekend pointed to a change in take in terms of government’s approach towards the economy.
There is even talk of compensating white commercial farmers, with Lands Minister Douglas Mombeshora saying government is mobilising funds to compensate former white commercial farmers for improvements they made on land that was repossessed under land reform.
Farm invasions are no longer tolerated, with the two Deputy Ministers of Agriculture Paddy Zhanda and Davis Marapira calling for a stop to renewed illegal farm invasions as they were disturbing agricultural productivity and contributing to food insecurity.
The mandatory blending of fuel which was supposed to start at the 5% level has now been approved to start at the 10% level by October 15. Energy Minister Dzikamai Mavhaire said the level should be 15% for November 31 and 20% by March 30 2014.
Zanu-PF officials are also calling on their president to make good his threat to fire underperforming ministers. Chris Mushohwe has implored Mugabe to crack the whip on non-performing public officials, saying the new Zanu-PF administration’s thrust was to deliver on key result areas such as revival of the industrial sector.
He said those entrusted with public offices should deliver or face expulsion, and urged the media to expose incompetent public officials.
Meanwhile, police commissioner general Augustine Chihuri is reported to have stepped in to rein in corrupt top police officers who had created Mafia-style operations to dupe people of their money and property.
This move comes after a police commissioner, Oliver Chibage, was fired last week amid allegations levelled against him by different people.
Is there a new dispensation in Zimbabwe? Only time will tell.
- Fin24
*Malcom Sharara is Fin24’s correspondent in Zimbabwe. Views expressed are his own.
