Zanu-PF plans to take-over banks after polls

Zimbabwe's Minister of Indigenisation Saviour Kasukuwere is confident his Zanu-PF party will win the elections on Wednesday and intensify plans to take over controlling stakes in banks and other key institutions.

Kasukuwere, an ally of President Robert Mugabe, has become the face and driving force behind the controversial indigenisation programme. It has been scaring off investors, causing direct foreign investment to plummet by about three-quarters in 2013.

Sitting in his office in Harare a day before elections, Kasukuwere believes that capital inflow will soon pick up.

"The capital will flow to Zimbabwe, because capital needs a home," he said in an interview.

"We have lots of new transactions coming in," he said, giving no details.

While Mugabe has adopted a "look east" strategy, it remains unclear if Chinese companies are keen on investing in Zimbabwe or see it as a place to sell cheap goods.

"It's no longer about targeting investors. It is about transforming our society so that the people of Zimbabwe can benefit from their resources," he insisted, while talking about "democratising the economic space."

Zimbabwe has fallen from one of the most stable and wealthy African nations to one of the poorest, haemorrhaging its skilled labour force to South Africa and other countries.

The decline was provoked partially by a land reform policy introduced in the late 1990s which was followed in 2 000 by forced take-overs of white-owned farms, ostensibly to help blacks gain access to land.

Kasukuwere says tobacco farms are finally now reaching the same level of production of 13 years ago, but admits food production is only at about 50% of capacity.

The cost of basic foods in Zimbabwe, once a self-sufficient country, remains high and unemployment affects most adults.

In 2007 Mugabe's government went a step further and passed an "indigenisation" law, which would require foreign companies to hand over a 51% stake to black Zimbabweans. This measure was intended to make up for decades of white-minority rule and colonialism.

Earlier this year, Kasukuwere brokered a deal which saw platinum producer Zimplats agree to hand over a 51% stake in its company, though the exact terms of the agreement are still being worked out.

Shortly afterwards, plans were announced to start a take-over of Standard Chartered bank. However, Gideon Gono, the governor of the Reserve Bank of Zimbabwe, denounced the idea, warning that destabilising a large financial institution would have "serious systemic consequences".

The criticism came from an unexpected source, as Gono has been seen at times as Mugabe's sergeant-at-arms and is widely blamed for being one of the principle players behind Zimbabwe's runaway hyper inflation, which devastated the economy until the local currency was scrapped in 2009 in favour of the US dollar and the South African rand.

Kasukuwere, who is convinced he will retain his office after the elections, is unflinching and said he will move ahead and demand stakes in banks this year.

"Progress is underway and we will intensify this programme after the election."

The minister said the July 31 vote is fundamentally a question about indigenisation.

"It is a choice of allowing for white domination or black control and moving forward."