Wednesday, August 07, 2013

Zimbabwe to Seize Mines While Compensating Banks

Robert Mugabe
President Robert Mugabe’s government plans to seize control of foreign-owned mines without paying for them as part of a program to accumulate $7 billion of assets following his July 31 election victory.  The government will compensate bank owners as it takes control of their companies.
Indiginization Minister Saviour Kasukuwere, the minister in charge of the program to compel foreign companies to cede 51 percent of their assets to black investors or the government, believes that,
“When it comes to natural resources, Zimbabwe will not pay for her resources.  If they don’t want to follow the law that’s their problem. Non-compliant mine owners risk losing their licenses."
Anglo American Platinum Ltd. (AMS),

Impala Platinum Holdings Ltd. (IMP),

Barclays Plc (BARC) and

Standard Chartered Plc (STAN)

are among companies that operate in the country. Other industries may have to yield smaller stakes to black owners. Metals and minerals, including platinum and gold, accounted for 71 percent, or $719.9 million, in exports in the first four months of this year. Anglo American Platinum is the world’s biggest producer of the metal.

The government and black Zimbabweans will take half of the value of assets it has identified in the economy. The state empowerment fund has so far acquired about $1 billion in assets.

The government will open a new stock exchange to trade the black-owned stakes in the companies. Trading at the Harare Stock Exchange, which would rival the Zimbabwe Stock Exchange, may start within 100 days of the new government taking office and will only be open to black Zimbabwean. Investments in Zimbabwe will be protected by the government as long as companies do not seek to exploit the country without its people benefiting.  (Bloomberg, 8/6/2013)

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