(TALKZIMBABWE) Analysts respond to MDC, Anglo ‘deal’
COMMENT - More on this backroom dealing here:Zimbabwe: Anglo American Remains Mum on Talks With MDC
Business Day (Johannesburg)
15 August 2008
Posted to the web 15 August 2008
Charlotte Mathews
Johannesburg
Anglo holding talks with MDC for Zimbabwean mining rights
London’s Financial Times says Anglo American is in talks with Zimbabwe’s Movement for Democratic Change to secure platinum mining rights should the party take power.
Posted: Thursday , 14 Aug 2008
JOHANNESBURG (Reuters) -
Anglo American
Anglo holds talks with MDC on Zim mining rights-FT
Thu Aug 14, 2008 6:51am EDT
Analysts respond to MDC, Anglo ‘deal’
Our reporter/FT/The Times
Fri, 15 Aug 2008 06:53:00 +0000
Cynthia Carrol (R), Anglo American's CEO and MDC leader, Morgan Tsvangirai (R)
ANALYSTS in the mining and other industries have express shock and scepticism over alleged talks between mining giant Anglo American and Zimbabwe’s opposition Movement for Democratic Change party led by Morgan Tsvangirai.
Yesterday we reported that the MDC party and Anglo were involved in sideline deals that would see mining concessions ceded to the Zanu PF government by Anglo reversed if the opposition party came into power.
The story was broken by the Financial Times (UK) and alleged that two MDC-T officials had held secret talks with the mining giant and had promised them some deals should they get into power. This development was barely a week after MDC treasurer-general, Roy Bennett had expressed his anger at the fact that Anglo was planning a US$400 million investment in Zimbabwe. Bennett at the time argued that the mining conglomerate was “propping up the Mugabe regime”.
Industry analysts expressed scepticism at the alleged deals and Anglo and the MDC-T party remained tight-lipped on the allegations.
Anglo American spokesman James Wyatt-Tilby was approached by The Times (SA) newspaper and would not comment on the story.
Sholto Dolamo, precious metals analyst at Stanlib was quoted as saying the story was “a bit dodgy”. He said: ‘‘I think the story is a bit dodgy. It is very unlike Anglo to talk to the MDC without the MDC being the official ruling party.”
Dolamo added: “Investors … have adopted a wait-and-see approach. You could have burned your fingers earlier, for example, after the elections when it seemed the MDC had won. If you had gone in there lock, stock and barrel you would have burned your fingers. So investors have a wait-and-see approach.”
South Africa’s Standard Bank economist Victor Munyama also expressed that many companies had taken that “wait-and-see approach” adding that mining in Zimbabwe had the potential of becoming very big. He said that many companies had pulled out of Zimbabwe, but were now waiting in the wings.
“Zimbabwe has the largest platinum reserves in the world after South Africa. Mining was big in Zimbabwe and has the potential to be big again. So I think a lot of corporations are waiting on the periphery,” said Munyama.
“I don’t think many corporations will engage in talks with political parties.
“Property rights, the rule of law, can contracts be enforced — corporations will be looking more at those.
“It doesn’t make any sense to make a deal with any party before there is assurance that those domestic institutions are in place. So far, we are not quite sure what the outcome is going to be.
“A lot of institutions and corporations will go back, but the political direction needs to be certain. It is common knowledge that everyone is waiting on the periphery.”
Munyama added that the government of Zimbabwe needed to make clear to investors the details of the empowerment legislation and how it will, in the short run and long run, affect investors. He said greater clarity was still needed on Zimbabwe’s economic empowerment legislation.
In March, the Zimbabwe government passed the Indigenization and Economic Empowerment Act, mooted last year which will force foreign-owned firms to sell at least 51% of the shares of every public company and other businesses to indigenous Zimbabwean businessmen.
The Act also specifies that no restructuring, merger or demerger shall be approved unless indigenous Zimbabweans hold 51 percent shares in the resultant business.
An agreement between the MDC and Anglo could affect current negotiations aimed at finding a peaceful solution to the Zimbabwe crisis. It could also affect current contracts that the government of Zimbabwe holds with other companies.
In April this year, a deal was struck between the Zimbabwe government and AIM-listed copper and cobalt producer Camec which bought former Anglo-owned platinum properties in Zimbabwe through the acquisition of British firm Lefever Finance.
Camec is owned by former England cricket spin bowler, Phil Edmonds who recently came under fire from Britain for doing business with President Robert Mugabe’s government.
Camecsaid it believed that "investing in Zimbabwe at this early stage is the best way to help the people of Zimbabwe while also generating shareholder value".
FT/The Times/Zim Guardian
Labels: ANGLO-AMERICAN, MDC, MoU
posted by MrK @ 7:12 PM
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