March 10th, 2011
01:23 PM GMT
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As usual, it seems the Zimbabwean government isn’t singing from the same hymnbook, as the saying goes.

During a conference in Harare set up to try to encourage “investment in Zimbabwe,” a slew of mixed messages emerged that cannot have done much to change perceptions that Zimbabwe is a “business unfriendly” destination.

The investment conference attracted hundreds of delegates, among them business people, policy makers, financiers and key overseas players keen to explore business opportunities in the troubled nation.

However, instead of placating international investors, conflicting comments from the two factions in the Zimbabwean government have managed to highlight exactly why it is still deeply risky to invest in Zimbabwe.

On day one, a cabinet minister appointed by President Robert Mugabe’s ZANU-PF party said the power-sharing government resolved to form a “sovereign wealth fund” by nationalizing the majority of the mining sector to raise funds for development.

He said: “We have been careful to implement this. This Friday we are gazetting the minimum threshold for the mining sector. We need the 51% (equity) to come into our sovereign wealth fund. We are all agreed as a government.”

So it was nearly a done deal? Zimbabwe’s mines were to be definitely nationalized? Reuters ran a headline saying as much.

Perhaps not.

On day two of the conference, Prime Minister Morgan Tsvangirai – his party the MDC is a joint member of the “unity government” with Robert Mugabe’s ZANU-PF – quashed any talk of the imminent implementation of the controversial Indigenization Bill, in which foreign-owned companies will be expected to hand over some control to black Zimbabweans.

Underpinning the divisions in the government, Tsvangirai contradicted the comments of the cabinet minister. According to Reuters, he said Zimbabwe's cabinet had not yet decided minimum ownership thresholds for foreign companies. He also apparently said that the government had not yet drawn up detailed plans on a proposed sovereign wealth fund to buy majority stakes in foreign mining firms.

It is virtually impossible for the Zimbabwean government to speak with one voice about the country’s investment future.

The reasons are complicated – however, much of this division is down to internal politicking.

Zanu-PF is pushing for an early election and is trying to entice voters by playing up “empowerment” policies. Also, constantly second-guessing MDC efforts to encourage investment makes Tsvangirai and his party look ineffectual and unable to deliver economic stability for local Zimbabweans.

Does all this mis-talk matter? Will the big mining companies continue as usual? For example, a company like Rio Tinto is well schooled in managing political risk. Just how much of a deterrent is this instability to investors?

And what if a certain type of international investor doesn’t really care what either MDC or Zanu says publicly? Newsday, a Zimbabwean daily, is reporting that the United States has warned the Zimbabwean government over doing any uranium deals with Iran after another cabinet minister allegedly said about Iran: “If we can work together on uranium mining, it will improve the economic situation of both countries.”



soundoff (6 Responses)
  1. mzawami

    How come there has been no mention of the arrested Matebeleland Politicians who were arrested and a facing a death penalty.
    Check this link. http://www.facebook.com/mlf.mthwakazi

    March 11, 2011 at 10:52 pm |
  2. jmj

    Given the state of affairs in zimbabwe and the continuing violation of human rights , when is the ICC going to charge the criminal mugabe on crimes against his own people , namely the massacres perpretrated by the north korean 5th brigade , the killings of slavery works in the diamond fields ; when is this criminal going to be increminated and judged agains all that he has done against the people of zimbabwe ?

    March 12, 2011 at 7:25 am |
  3. Emmanel

    How can they speak with one voice, U allowed your self to be used by the western world. They never care about the innocent civilians who are dying of hungry because of their so called sanctions. Instead they are after crude. If all of you died today no body cares only writhing statements finish. Is better to open your eyes

    March 20, 2011 at 3:11 am |
  4. Oceano maliq

    What about the unfolding of the mass grave that is speculated to be in 200 locations with 2000 dead bodies. Who's the real culprits??

    March 21, 2011 at 3:48 pm |
  5. Spock_rhp, Miami, FL

    Universe offers lessons to humanity. We humans did not design Universe and are not running it. We do have the option to either get the lessons or suffer the consequences. Universe does not care if some regime completely bollixes up the works and their people suffer. Either the regime will change, will be changed [possibly by force of arms], or the lesson will continue to dish out consequences.

    In essence, Universe is a learning machine. We can either learn or die. Zimbabwe hasn't been learning. Starvation in a land that was once a source of plenty is a pretty plain lesson.

    March 24, 2011 at 12:19 am |
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    September 24, 2012 at 1:02 pm |

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