Zim indigenisation law being misinterpreted - Biti

FINANCE minister Tendai Biti has hinted that section 3 of the indigenisation act has been misinterpreted by the Minister of Youth Development, Indigenisation and Empowerement, Saviour Kasukuwere, who has threatened to seize substantial shareholding of banks under the empowerment law.

Biti has criticised the manner in which the indigenisation law is being interpreted and applied in the country.

He implicitly dismissed the overtures being made by the Minister of Youth Development, Indigenisation and Empowerment, Saviour Kasukuwere, who threatened to seize substantial shareholding of banks under the guise of the law.

Biti, a lawyer by profession, said "The law does not say that every foreign-owned company shall be 51%-owned, the law says it is the intention to reach the destination of 51% ownership, so it's discretionary. A peremptory interpretation is therefore wrong."

But Kasukuwere recently published a notice saying that mining firms that failed to meet last year's September 25 deadline should note that 51% of their shareholding would now be deemed to be owned by the State.

The indigenisation and economic empowerment legislation has caused a great deal of consternation among international investors seeking to explore new and emerging markets, such as Zimbabwe.

Biti explained that both the law and the March 2010 regulations were very clear, providing evidence of there being no nationalisation in Zimbabwe.

Biti warned against tampering with the banking sector arguing that capital was very fluid and fungible (the quality of being capable of exchange or interchange).

The Finance minister urged authorities to be cognisant of the important role that banks have been playing to keep the economy functioning.