Zimbabwe appoints financial advisers to raise capital to buy indigenisation shares

The Zimbabwe government has appointed financial advisors to assist indigenous Zimbabweans in mobilising capital to buy shares in foreign owned companies in line with the indigenisation policy.

In terms of the arrangement, five financial institutions: CBZ Bank, Vunanni Capital, Genesis Global Finance, Capvest Consulting and MMC Capital have been mandated by the government to mobilise funds in the local and foreign markets.

The National Indigenisation and Economic Empowerment Board (NIEEB) Chairman, David Chapfika said the move was taken after consultations with private sector players and the banking industry on modalities to assist locals with capital to buy stakes in externally owned firms operating within the country.

"We hope this system will in the future assist in the development of policies to boost black empowerment," Chapfika said.

The appointment of the financial advisors is among other factors expected to assist indigenous Zimbabweans with funds for business start-ups, rehabilitation and expansion of existing businesses.

The indigenisation and economic empowerment regulations became effective in  March last year in a move which entails every business in Zimbabwe with an asset value of $500 000 to comply with the Indigenisation and Economic Empowerment  Act  Chapter 14:33, which also focuses on ensuring  that locals get majority stakes in foreign-controlled firms.

Under an economic empowerment and indigenisation law that came into force last year foreign-owned firms must sell at least 51 percent shares to locals or face a host of punitive measures including fines, imprisonment and or withdrawal of operating licences.