By Business Reporter
In a bid to promote investment in line with the “Zimbabwe is Open for Business” mantra, Government yesterday clarified amendment to the Indigenisation and Economic Empowerment Act (IEE Act) [Chapter 14:33 contained in the Finance (No 2) Act, 2020 (section 36) to allow for more investments in the mining sector.
In a joint statement released by the Ministry of Finance and Economic Development and the Ministry of Mines and Mining Development, Government said it has removed some sections of the IEE Act that might have caused some misconception to investors and other stakeholders in the mining sector.
“It has come to Government’s notice that the amendment to the Indigenisation and Economic Empowerment Act [Chapter 14:33] (IEE Act) contained in the Finance (No 2) Act, 2020 (section 36) may have caused some misconception to some investors and other stakeholders in the Mining sector.
“Government announced the policy position to remove the requirement for 51% of the shareholding of businesses involved in the extraction of Platinum and Diamonds to be owned through a designated entity. That requirement has been removed through the amendment to the IEE Act, in section 3(1),” reads part of the statement.
Government further said it has not departed from its stated position to open the mining sector to investment without the requirement of the 51 percent shareholding being held by a designated entity.
“There are no minerals the extraction of which require a business extracting same to have 51% of its shareholding being owned by a designated entity. This is consistent with Government’s position that there is no mineral, the extraction of which, Government considers requires mandatory shareholding participation through a designated entity.
“The provision in Section 36 of the Finance (No 2) Act, 2020, to the effect that the Minister responsible for the IEE Act, may, in consultation with the Ministers responsible for Mines and Finance prescribe a mineral, the extraction of which would be subject to 51% shareholding by a designated entity, has been interpreted by some to represent a departure from Government’s stated position to open the mining sector to investment without the requirement for 51% of the shareholding being held by a designated entity,” reads the statement.
Government said the amendments to the IEE Act is meant to promote the “Zimbabwe is Open for Business Mantra”.
During his address at the World Economic Forum in Davos, two (2) years ago, President Mnangagwa told attendants that Zimbabwe has lagged behind in many areas as a result of isolation by other countries and he declared that the country was open for business so that it can catch up with its peers in terms of development.
The President further said there was need to look at the legislation that had been constraining investors from coming to Zimbabwe. The amendments to the IEE Act is therefore one way of improving the ease of doing business in Zimbabwe.
