Monday, 21 January 2013

Zimbabwe Indigenisation Minister Takes On Banks

Banks appear to be the next target in Zimbabwe's indigenisation process (link). Kasukuwere said last week that "he was targeting the banks namely Barclays, Stanbic and Standard Chartered which are still to comply with the indigenisation law". Reserve Bank Governor, Gideon Gono and Finance Minister, Tendai Biti have both called for caution in dealing with the banking sector. Zimbabwe is still recovering from a devastating period of hyper-inflation. Destabilising the banking sector could be a very bad idea.

Zimbabwe is not the only country in Southern Africa with local-ownership laws. Botswana, for example, has strict controls on mineral rights and Mozambique restricts foreign ownership of land. Several Southern African countries also encourage local ownership informally or through incentives, such as access to government contracts, without formally legislating it. The problem is not that Zimbabwe is pushing for local control of the economy, it's that what should be a sensible, serious national development policy has turned into a political football in a fraught and fractious election run-up.

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