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Zimbabwe mines to be forced to sell equity

Publish date: 16 August 2005
Issue Number: 1399
Diary: Legalbrief Today
Category: Legislation

Zimbabwe is taking legislative steps to force foreign-owned mining houses – most mines in the country are foreign-owned – to cede 30% equity to local black investors in the next 10 years, says a Business Day report, noting the legislation will fuel uncertainty in the country’s troubled economy.

The report says analysts argue the move is a ploy by the forex-strapped government to retain some of the mining sector’s profits. Draft regulations to be inserted into the Mines and Mineral Act through a statutory instrument show government is mulling over plans to reform the sector using SA’s mining charter as a model. The amendment, yet to be tabled before parliament, says: ‘In order to increase participation and ownership by historically disadvantaged persons in the mining industry, companies shall achieve 30% ownership of the industry assets in 10 years of which 20% shall be achieved in two years, 25% in seven years and 30% in 10 years from the date on which these regulations take effect’. Full report in Business Day