The ManicaPost
Business Correspondent
Telecommunications, Postal and Courier Services Minister Supa Mandiwanzira has assured German logistics firm DHL that it won’t be compelled to make equity changes in line with the country’s Indigenous law requirements as the company sought policy clarification before it renews its operating licence and further pursue local investment projects in the short-term.
The indigenisation law stipulates that for any foreign owned company to operate within Zimbabwe, it has to cede 51 percent ownership to locals and of particular note for the logistics giant is the expectation from the Postal and Telecommunications Regulatory Act that reaffirming that any licenced operator should also hand 51 percent stake to indigenous players.
It emerged that this had prompted uncertainty on DHL’s plans to further its operations and short-term investments in the country as the company has not met indigenous law equity targets.
However, following the clarification on the Indigenisation law in April last year by President Mugabe, potential investors in sectors outside that of extraction or any form of exploitation of the country’s natural resources such as the services sector were excluded from 51 percent handover to locals provided they engage Government with future investment projects which benefit locals through employment creation and other income generating projects.
Addressing journalists at his Ministry offices in Harare last week after meeting German Ambassador, Mr Thorsten Hutter and DHL vice president Brett Hattaway who promised to expand DHL operations in the country, Cde Mandiwanzira said potential investors in the services sectors were free to negotiate the indigenous law with Government as pronounced by the President since the law is only non-negotiable to those in natural resources-anchored sectors.
“Because of the clarity that the President has put forward regarding ownership, particularly investing in services industries, that it is not as cast in stone as investment in natural resources sectors like mining where 51 per cent local ownership is mandatory and not negotiable.
“In terms of the services sector it is very different. If a company like DHL commits to investing in the community and people of Zimbabwe aside of its main business, there are provisions that allow us as the ministry and regulator to give them more leeway to hold on to some shares but putting in more investment,” he said.
Government continues to cajole potential investors in various sectors of the economy and the revision of the indigenous legislation to make it flexible is one among a host of initiatives it has undertaken in the past year, including the ease of doing reforms reform and implementation of special economic zones.
The country is in need of foreign direct investment across the entire economic spectrum particularly in the primary and services sectors to pursue its economic blueprint ZIMASSET.
The services sector has emerged as the country’s leading contributor to economic growth constituting over 50 per cent to GDP spurred by emerging sub-sectors like the ICT, postal, logistics and retail and wholesale players.
Zimbabwe continues to be at the centre of the global logistics giant’s plans due to its geographic centrality in the Southern African region with Harare having been once the main hub for its regional business before the economic downturn.
With the SADC industrialisation strategy gaining momentum, the transport and logistics sector is poised for greater fortunes as more intra-regional trade is expected to grow yielding business opportunities for players in the sub-sectors.
“We had a fruitful meeting with DHL and the minister and we have discussed the question of the future investment of DHL in Zimbabwe to grow business, to create jobs and to be a good corporate citizen in this country. We have overcome questions that existed on the side of DHL regarding the indigenous law,” said Ambassador Hutter.
