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REPORTS that Zimbabwean president Robert Mugabe said foreign banks are not necessarily expected to cede 51% to local indigenous people must be welcome to the banks, but are a serious indictment of government policies characterised by inconsistencies.
Speaking in a ZBC TV interview marking his 89th birthday, President Robert Mugabe said for the financial services sector “you can go 50/50 or you can agree on a ratio that is sustainable and equitable.
"It’s not in every case that we must apply the 51/49."
He added that the principle of ceding 51% could not be applied "because the resource (banking technology and infrastructure) is not yours" as it had been brought into the country by the foreign banks.
Barclays Bank, Stanbic Bank (Standard Bank SA), Standard Chartered Bank, Old Mutual owned MBCA Bank and CABS are some of the banks that will join the RBZ and the Ministry of Finance in welcoming the president’s comments, but where does this leave the country in terms of policy?
Mugabe also castigated Indigenisation and Economic Empowerment Minister Saviour Kasukuwere, saying he had “got it wrong” on the “controversial” Zimplats deal.
The president said where Zimbabwe owns the resources, especially in mining, 51% control has to be given to black Zimbabweans.
From the look of things it seems like Zimbabwean authorities have a penchant for uncertainty and lack of transparency in policy - yet everybody knows policy inconsistency is not healthy for the nation.
In fact, talking about how policy inconsistencies damages investors' confidence would sound like a broken record - but how else do we stop talking about it, when those in authority show disregard for this virtue?
We understand that the president delegated the implementation of this law to Kasukuwere, but for him to make public comments a few months after such an important deal was signed and after officiating at several empowerment ceremonies, shows how those in the government rush to implement policies that are neither a result of well-thought-out processes nor business-friendly.
From the onset, red flags were raised about how wrong the responsible minister was in implementing the indigenisation law - but the president did not say anything.
The fact that Kasukuwere continued with his crusade to implement a policy that raised concern among the people shows both arrogance and ignorance on the part of our policymakers.
Even now we have had instances where policies have shown glaring internal inconsistencies, while at the same time strategic national projects have stalled because of political bickering.
Two multimillion dollar deals, the Ziscosteel one with Essar and the ethanol one in Chisumbanje, quickly come to mind.
Policy inconsistency is nothing other than the height of poor governance and it must be rooted out if there is to be any meaningful recovery in Zimbabwe.
We have seen in the past how inconsistencies in policy result in confusion and economic meltdown, among other things.
Such inconsistencies have resulted in Zimbabwe missing out in the scramble for Africa that has seen Nigeria, Kenya, Angola and neighbouring Mozambique get huge amounts on investments.
Some analysts believe “Mugabe’s indigenisation template is diametrically opposed to the one used so far by Kasukuwere”.
If that is the case, the president need a lesson or two about delegation as poor delegation might cause frustration and confusion to all the involved parties.
Jeffrey Pfeffer of Stanford University's Graduate School of Business, author of What Were They Thinking?: Unconventional Wisdom About Management, says: “Your most important task as a leader is to teach people how to think and ask the right questions so that the world doesn't go to hell if you take a day off."
And part of delegation entails clear communication. Open, clear communication from the get-go is absolutely crucial to ensuring that the projects you delegate will be done well.
Judging by Mugabe’s comments, delegation seems not to have worked, resulting in alarming inconsistencies on how the crucial indigenisation laws are being implemented.
- Fin24
*Malcom Sharara is Fin24’s correspondent in Zimbabwe. Views expressed are his own.
Speaking in a ZBC TV interview marking his 89th birthday, President Robert Mugabe said for the financial services sector “you can go 50/50 or you can agree on a ratio that is sustainable and equitable.
"It’s not in every case that we must apply the 51/49."
He added that the principle of ceding 51% could not be applied "because the resource (banking technology and infrastructure) is not yours" as it had been brought into the country by the foreign banks.
Barclays Bank, Stanbic Bank (Standard Bank SA), Standard Chartered Bank, Old Mutual owned MBCA Bank and CABS are some of the banks that will join the RBZ and the Ministry of Finance in welcoming the president’s comments, but where does this leave the country in terms of policy?
Mugabe also castigated Indigenisation and Economic Empowerment Minister Saviour Kasukuwere, saying he had “got it wrong” on the “controversial” Zimplats deal.
The president said where Zimbabwe owns the resources, especially in mining, 51% control has to be given to black Zimbabweans.
From the look of things it seems like Zimbabwean authorities have a penchant for uncertainty and lack of transparency in policy - yet everybody knows policy inconsistency is not healthy for the nation.
In fact, talking about how policy inconsistencies damages investors' confidence would sound like a broken record - but how else do we stop talking about it, when those in authority show disregard for this virtue?
We understand that the president delegated the implementation of this law to Kasukuwere, but for him to make public comments a few months after such an important deal was signed and after officiating at several empowerment ceremonies, shows how those in the government rush to implement policies that are neither a result of well-thought-out processes nor business-friendly.
From the onset, red flags were raised about how wrong the responsible minister was in implementing the indigenisation law - but the president did not say anything.
The fact that Kasukuwere continued with his crusade to implement a policy that raised concern among the people shows both arrogance and ignorance on the part of our policymakers.
Even now we have had instances where policies have shown glaring internal inconsistencies, while at the same time strategic national projects have stalled because of political bickering.
Two multimillion dollar deals, the Ziscosteel one with Essar and the ethanol one in Chisumbanje, quickly come to mind.
Policy inconsistency is nothing other than the height of poor governance and it must be rooted out if there is to be any meaningful recovery in Zimbabwe.
We have seen in the past how inconsistencies in policy result in confusion and economic meltdown, among other things.
Such inconsistencies have resulted in Zimbabwe missing out in the scramble for Africa that has seen Nigeria, Kenya, Angola and neighbouring Mozambique get huge amounts on investments.
Some analysts believe “Mugabe’s indigenisation template is diametrically opposed to the one used so far by Kasukuwere”.
If that is the case, the president need a lesson or two about delegation as poor delegation might cause frustration and confusion to all the involved parties.
Jeffrey Pfeffer of Stanford University's Graduate School of Business, author of What Were They Thinking?: Unconventional Wisdom About Management, says: “Your most important task as a leader is to teach people how to think and ask the right questions so that the world doesn't go to hell if you take a day off."
And part of delegation entails clear communication. Open, clear communication from the get-go is absolutely crucial to ensuring that the projects you delegate will be done well.
Judging by Mugabe’s comments, delegation seems not to have worked, resulting in alarming inconsistencies on how the crucial indigenisation laws are being implemented.
- Fin24
*Malcom Sharara is Fin24’s correspondent in Zimbabwe. Views expressed are his own.
