Zimbabwe PM says local ownership rule too stringent

Mon Oct 17, 2011

JOHANNESBURG (Reuters) - Zimbabwe's local ownership rules for foreign mining companies are too stringent, Prime Minister Morgan Tsvangirai said on Monday.

Under the controversial law, the Zimbabwean units of international firms are required eventually to become majority-owned by local blacks.

The change in ownership will take years, Prime Minister Morgan Tsvangirai said, with even a minimum of 30 percent as an initial threshold being too high.

"I think 30 percent is too high," Tsvangirai told reporters in Johannesburg on the sidelines of an agricultural conference.

(sourced Reuters)

Zimbabwe may give mines more time on ownership plans

Sept11,2011

* Zimplats accounts for 10 percent of Implats' output
* Implats shares up two percent

HARARE (Reuters) - Zimbabwe may give foreign miners more time to submit plans to transfer majority stakes to local black investors, the state-run Herald newspaper said on Friday.

Firms such Zimplats , the local unit of South Africa's Impala Platinum have asked for an extension of the deadline to submit empowerment plans, the paper said.

"Our teams are now working with some mining companies that have asked for more time to work on their new proposals and we will keep the public updated on the developments," Empowerment Minister Saviour Kasukuwere told the Herald.

The paper said Zimplats was working on a proposal to submit by the end of November, two months past the original deadline to transfer majority stakes.

"It appears that the timeframe that Zimplats was given to amend its proposal was short and the company has now requested for about two months to work on another proposal," said the paper, which is widely seen as an official government mouthpiece.

"A new proposal would be submitted to government before the end of November. The new plan will have an element of the community share ownership trust," Zimplats deputy chairman Much Masunda was quoted as saying.

Implats' shares fell more than three percent on Thursday on reports the government was moving to revoke Zimplats' licence. The shares recouped about two percent on Friday morning, outpacing a 0.25 percent rise on the blue-chip top 40 index .

Zimplats' accounts for about 10 percent of Implats' annual group output of close to 1.8 million ounces of platinum.

(sourced Thomson Reuters)

Zimbabwe to take controlling stake in mines

Wed Mar 9, 2011 1:25pm GMT

* New rules to take effect next week
* To establish sovereign wealth fund for 51 pct stakes
* Move seen as strong-armed negotiating ploy

By Alfonce Mbizwo

HARARE, March 9 (Reuters) - Zimbabwe will effectively nationalise half of the country's key resources sector by setting up a sovereign wealth fund to own 51 percent stakes of mining companies, a government minister said on Wednesday.

Saviour Kasukuwere, minister of youth empowerment and indigenisation, said the government in the resource-rich country would publish guidelines on local mine ownership regulations on Friday and the rules would take effect within a week.

Analysts said impoverished Zimbabwe does not have the money to buy controlling stakes but is likely using the threat to force global mining giants to the bargaining table so the country with the world's second-largest platinum reserves can receive more money from its mineral riches.

The move is likely to discourage foreign investment and will hit foreign miners in the state including AngloPlat (AMSJ.J: Quote) and Impala Platinum (IMPJ.J: Quote), the world's largest and second largest platinum producers, and Rio Tinto (RIO.L: Quote), which runs a diamond mine in the country.

"In the mining sector specifically, we have been getting a raw deal all this time with companies taking money out of the country," Kasukuwere said, without offering details of the plan.

Kasukuwere said earnings from mineral exports reached $1.7 billion in 2010, about 30 percent of the country's estimated yearly GDP, but that mining companies had only paid $4 million in taxes to the government.

"The signal that they are sending is that 'we can change anything in this country and it can impact on investment at any time'," said Claude Kabemba, director of Southern Africa Resource Watch.

"Their push will be incremental. If they are serious about the 51 percent, they must start somewhere," he said. "They might negotiate a very low price to start and on top of that negotiate a repayment strategy."

President Robert Mugabe signed the Indigenisation and Economic Empowerment Act in 2008 and the government has issued regulations of how foreign-owned companies should achieve at least 51 percent black ownership within five years.

Mining firms may decide to pull out of the country but they risk losing rights to the massive platinum reserves and other minerals as mining companies from Mugabe's biggest backer China wait in the wings, perhaps looking to take over the claims.

Mugabe, shunned by Western governments who suspect him of using violence and rigged elections to stay in power, has seen overseas aid dry up and investment deterred as his destitute country has faced greater global isolation.

Kasukuwere said not all sectors would be required to sell 51 percent shares, citing the manufacturing industry which he said was still fragile and needed more time to recover. Analysts said years of mismanagement by Mugaba'e ZANU-PF has only made things worse for an economy that was crushed by hyperinflation a few years ago.

Mugabe is pushing for elections this year and could be looking for cash as he fights political rival and unity government partner, the Movement for Democratic Change (MDC).

The MDC forced into a power-sharing government with Mugabe after disputed 2008 elections, have been campaigning for foreign investment to add strength to a nascent economic recovery that came after the unity government was formed.

MDC officials have also tried to ally concerns about the law that the government said was aimed at addressing the unresolved economic imbalances left by decades of white minority rule, and would ultimately create a stable economy and fair society.

But foreign companies regularly cite the law as their main concern about investing in the southern African country.

Shares in Zimplats Holdings (ZIM.AX: Quote), a unit of Implats, is down nearly 20 percent since the start of this month and the company said in a statement to the Australian Stock Exchange the fall could be attributed to news around the new ownership rules. (Additional reporting by MacDonald Dzirutwe in Harare and Olivia Kumwenda in Johannesburg; Editing by Jon Herskovitz and Jason Neely, sourced Thomson Reuters)

New Zimbabwe mine ownership rules effective next week

Wed Mar 9, 2011 9:29am GMT

HARARE, March 9 (Reuters) - Zimbabwe's new mine ownership rules which will require mining companies to give up 51 percent stakes to the government will be effective seven days after their official publishment on Friday, a minister said on Wendesday.

"The rule will be effective seven days after it is gazetted," Saviour Kasukuwere, Minister of Youth Empowerment and Indigenisation, told Reuters on the sidelines of an investor conference.(Reporting by MacDonald Dzirutwe, Editing by Agnieszka Flak,sourced:Thomson Reuters)