Zimbabwe Government Said to Seek Ban on Foreign Investment in Retail Sector
Sources said officials will seek repeal of the Zimbabwe Investment Authority Act allowing foreign participation in retail
Jindal Steel and Power of India is bidding again for a strategic stake in the Zimbabwe Iron and Steel Company or ZiscoSteel after an unsuccessful bid two months ago The Zimbabwe government in conjunction with the National Indigenization and Economic Empowerment Board is said to be drafting legislation to block foreigners from investing in the retail sector. Sources said the law is aimed in particular at Nigerian and Chinese entrepreneurs who established a major presence in Zimbabwean retail over the decade of economic decline through 2009. The sources said officials will be seeking the repeal of the Zimbabwe Investment Authority Act under which foreign investors are allowed to participate in retail merchandising. Affirmative Action Group President Supa Mandiwanzira argued that the government should use the indigenization program to block foreigners from investing in the retail sector. Mandiwanzira told VOA Studio 7 reporter Gibbs Dube that local authorities should immediately cease issuing new retail licenses to foreigners. But economic commentator Rejoice Ngwenya said moves to block foreigners from the retail sector will cause chaos in Zimbabwe. Economist Godfrey Kanyenze said such discriminatory laws are counterproductive. Meanwhile, Jindal Steel and Power of India is re-bidding for a major stake in the Zimbabwe Iron and Steel Company or ZiscoSteel after an unsuccessful bid two months ago. According to the Economist newspaper of India, the steel giant wants a 70 percent stake in ZiscoSteel though the Zimbabwe government is offering only a 51 percent stake. Jindal Steel’s previous bid was reportedly rejected by the government which said the company had no concrete plans to handle the ZiscoSteel debts amounting to some US$300 million. Economic and political commentator Bekithemba Mhlanga said the huge ZiscoSteel debt may force government to accept a multinational corporation to rescue the collapsed steelmaker.