Foreign shop owners have once again been threatened with prosecution if they do not comply with Zimbabwe’s indigenisation laws by the end of this year, being told to relinquish their businesses or be jailed.
This latest ultimatum was voiced by the Secretary for Youth, Indigenisation and Economic Empowerment George Magosvongwe who told a parliamentary committee meeting on Thursday that the foreigners who defied the law would be prosecuted.
“I confirm that some non-indigenous entities are still operating in the reserved sectors and there is a deadline (of) January 1 for them to comply with the requirement to relinquish their holdings in that sector… and we are putting in place measures for enforcement in the event that they do not comply,” said Magosvongwe.
Magosvongwe also said that the ZANU PF government was in the process of identifying indigenous Zimbabweans who would take over ownership of those businesses in the particular sectors.
Under the country’s Indigenisation and Economic Empowerment Act, foreigners operating in the ‘reserved sector’ are not welcome, with the law making it mandatory for the business owners to produce compliance certificates. The certificates are only eligible for indigenous Zimbabweans.
This requirement was first gazetted in May this year, with foreign traders being warned about the penalty they faced if they did not comply.
According to the Act, reserved sectors include agriculture, transport, retail, barbershops, hairdressing and beauty salons, employment and estate agencies, bakeries, tobacco processing, advertising agencies and even arts and crafts provisions.
Economist Masimba Kuchera told SW Radio Africa on Friday that the threats “follow the pattern of how this government deals with investors.” He said the ultimatum is unrealistic, and does not allow for enough time to prepare locals to take over the sector.
“It would be better for the government to build local capacity first, because if they chase out foreign traders without ensuring the capacity and resources are there for locals, then it will be very difficult for local traders to take over,” Kuchera said.