Tuesday, January 29, 2013

(NEWZIMBABWE) Community share schemes illegal: Biti

Community share schemes illegal: Biti
28/01/2013 00:00:00
by Gilbert Nyambabvu

FINANCE Minister Tendai Biti has claimed that community share ownership schemes foreign companies are being compelled to implement may be illegal adding some of the firms were using them to “bribe” their way out of indigenisation.

The community share schemes form a key part of the indigenisation programme being pushed by Empowerment Minister Saviour Kasukuwere but bitterly opposed by Zanu PF’s coalition partners.

Most major mining companies, among them Zimplats, Unki and Mimosa, have pledged to donate up to US$20 million to the schemes as part of plans to comply with the country’s indigenisation laws which force them to transfer majority control of their Zimbabwe operations to locals.

But Biti, a senior official in the MDC-T, which opposes the programme arguing it only benefits already wealthy elites, said the schemes rest on dodgy legal grounds.

“On what legal basis are companies being made to part with US$10 million dollars or US$15 million?” Biti said, according to a statement released Monday by his MDC-T party.

“There is nowhere in the Indigenisation act that compels companies to donate money to a community share scheme or to any farm or to anything so what you are actually seeing is coercion; companies being forced to part up with US$10 or US$15 million.”

Kasukuwere says the schemes are aimed at forcing companies to invest in the development of communities where they operate but Biti said the arrangements were an after-thought aimed at sanitising a “predatory and elitist” programme.

[Which is ironic, because the MDC are neoliberals who want to hand the mines over to Anglo-American De Beers, in a PPP or Joint Venture, like Debswana, in which the government of Botswana sees 15% of the value of the people's diamonds. - MrK]

“In the indigenisation and empowerment act, you will not find the word community share trust, you will not. Then you come to the regulations, statutory instrument number 30 of March 2010 that was passed or enacted by Saviour Kasukuwere, again you will not find the name community share trust,” said Biti.

“So the issue of community share schemes is actually an afterthought which is not backed by the empowering act, the indigenisation and empowerment act. Such that community share schemes don’t actually have legal existence vis-a-vis the Indigenisation and empowerment act.”

Zanu PF is basing its campaign for crucial elections expected this year on the “success” of the programme with major mining companies complying with law despite initial fears many would quit the country rather than give away majority shareholding in their local operations on the cheap.

But critics say the “success” claimed by Zanu PF is largely driven by fear.

"Most of these companies have massive investments in Zimbabwe [and] they would rather protect them than be confrontational," Charles Mangongera, a political analyst said recently.

"They saw how the white farmers were violently suppressed and they wouldn't risk having their investments decimated by challenging Zanu PF."

[I feel their pain. Transnational corporations are people too, after all. - MrK]

Biti also claimed that most foreign firms were using the community share schemes to “bribe” their way out of complying with the requirement.

He said: “To the extent that there is no company in Zimbabwe that I know of which has actually parted with 51% of its shareholding whether its Zimplats or not, you are having the anomalous situation where companies are bribing themselves out of compliance with the act by paying a mere US$ 10 million, US$5 million, whatever is the amount of the community share scheme.

“Another problem with this empowerment programme is certainly in the way it is being implemented; it is very opaque. Nobody knows the circumstances that those companies are parting with those monies.”

The MDC-T has warned it would review the programme if it comes into power after the next elections adding the approach taken by Zanu PF does not address the country’s job crisis and would keep investors out of the country.

COMMENTS

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Zuda Madhara

I respect Biti very much both as lawyer and academic; but I think on this issue the learned Minister is wrong. For once why can't these MDC-T ministers support something that benefit the long suffering poor black people of Zimbabwe. Is it not enough that these guys saddled these poor fellas with sanctions that almost decimated them from the face of the country? Unless the learned minister presents me with evidence of the said funds not reaching the said communities, I still believe that these community funds are good for the poor fellas. One cannot be seen to be defending corporate greed at the expense of the poor majority. The trend all over the world is inclining towards making corporates long known for their dodginess give something to the poor. For the record the US$10 million the minister is defending on behalf of corporates is money that they can easily blow up in a single night at a corporate casino do. Some of these things black leaders have got to be realistic or history will surely judge you harshly. Why can't the likes of Biti take a leaf out of President Obama who stook resolutely for the man in the street in America, to the extent of even jeopardising his second term in office. Where are the principles in these so-called leaders. I used to respect Biti but with this new line of thinking I think Biti has outlived his time in government. But then again he might be strategically aligning clients for himself for when he is out of office afetr elections. But then again vakuru vakati kwaunobva kanda huyo, kwaunoenda kanda huyo. Don't forget that of yesterday because of a single night's sleep. The year these poor people shall work up there will surely be gnashing of teeth among people using them for their political and economic ends - which include minister Biti. Being poor is not being stupid.
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Elma Sabudo

You missed the point " COMPANIES ARE BRIBING THEIR WAY OUT OF INDIGENISATION AND DISTORTING THE WHOLE PROGRAM".BY ANY STRETCH OF ENGLISH THIS IS NOT AGAINST .

There is no smoke without fire ,reasons why you came guns blazing because you and that thug Kasikuwere are the culprits Biti is taking about here .
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Muzezuru

It's either Biti is deliberately trying to mislead or he clearly has no clue of what he is talking about. The $10m has nothing to do with buying shares by the community, it is what these companies pledged to pay to develop the communities they are operating in. Instead of waiting for DANIDA, USaid and other foreign manipulative agencies these companies must fund the development. MDC-T thinks that community development can only be achieved through foreign aid. In Zvishavane the community has already repaired or are expanding schools, clinics and roads with proceeds from the $10m provided by Mimosa. This is over and above the 10% shareholding they got.

These legalistic ignoramuses like Biti pretend to be smart and sound knowledgeable when in actual fact they are stupid. He needs to read all the agreements on how equity is going to be paid for over 10 years in these companies before exposing his stupidity. Zimplats will be paid for through dividends and I'm sure it's the same with Unki. However, these mining companies also pledged $10m each to the communities in which they operate. This is the element that Mbiti is trying to use to confuse unless he really is as stupid as he sounds. Does everything have to be written down in law? These bookish lawyers will take us nowhere very fast. Instead of using his lawyer brain to come up with an enabling piece of legislation he is only interested in picking holes in something that is so noble. Ibharanzi blazi uyu!
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GeorgeBachinche

ewDoes every gesture need to be backed by a statutory law? If all companies past and present had been contributing to the development of communities around them, Rhodesia and Zimbabwe woulkd have gone miles towards development. For example if the Hippo Valley estate had helped the local Hlengwe communities develop poverty would have been lessened.

If there is need for a law, why can't the MDC MPs including himself enact one.

Surely is it rthe politics of the land to defend the interest of foreign companies in Zimbabwe.

How many of these companies give jobs to Africans in Diaspora?
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BigBoy Musonza

Why now Biti cheap sho buta. Ask how the Australians are doing it with mining companies same same Biti. Quite a cheap shot for a lwyer cum finance man
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ThurlowsJCJ

Dear oh dear!!!!!AnaKusukuwere vekumanyowa....
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Ngoko

kikikikikikiki
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Elma Sabundo

Community share schemes illegal:Biti hahaha.Tendai mBiti If you call this "illegal" then you know you committed treason by going behind closed doors urging the US to stop Zim from selling its precious stones by any means possible thereby sabotaging the economy lol....After elections you know Chihuri & Bonyongwe's boys are going to dance with you.
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Life!

Instead of asking these companies to build roads, schools, hospitals and other worthy infrastructure...zanu is busy forcing them to buy votes on their behalf.
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truth0001

here we go again: stupid legalism against REAL issues. These morons dont learn, remember the issue with that Traditional leaders who had an issue with that moron marrying in the month of Mbudzi??? They/mdc showed to be political novices/imatures/retards/ignoramious's ..there were better ways to engage the matter...it was an opportunity they could have used to lure traditional chefs by simple humility, even a fine of $50K would have been pretty OK to pay when you look at it from political investor point of view. They just dont get it!!!!

this statement FIRES UP SUPPORT..ACTIVE SUPPORT FOR ZANU.. the election ISSUES WAY MORE CLEARER. the battle LINES HAVE BEEN DRAWN CLEARER!! did BITI need to make clear his party's difference from zanu this way??? factoring in the fact that zanu has won popularity from the scheme?? and now he treatens to TAKE THAT little opportunity the sons and daughters of the soil had to enjoy thier God given mineral!!!???

Biti has just given ZANU/MUGABE more ammunation and even better, MORE SUPPORT from the rest of africa and the developing world (remember ZUMA'S remarks a couple days ago about zimbabwe's indigenious process, he showed to be proud african!!!! it motivates him to do for his africans in SA) sometimes Mugabe comes out as a very shrew politician not because he always exceptionally shrew but because his opponents are TOTAL idiots!!! this is just one eg of it. some people thought Biti could replace that other moron as leader of MDC but oh yea what difference would that make??? same fanana bafoons, polical baffons. Only chamisa has not said anything this rediculious
Biti forgot that even though his support base is city people, these city people are most bitter than rural people when it comes to capitalists making loads and loads profits and only give very little to workers. Its the city voter MOST EXCITED ABOUT THE community scheme than the rural people...and therefore BITI has REALLY SHOT at himself big time!!!! those who thought MDC may be better with BITI in charge can now see that its a party stuffed with idiots and morons
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Pitamba

If you trace these monies, you will find that they end up in the hands of those 'severally' empowered. We can have a better Zimbabwe, can't we? These shady deals in the name of indigenisation are setting us back. We deserve better from our leaders!

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