Germany Welcomes Regulations Suspension

The regulations which forced foreign owned business to cede 51 percent of their stake to indigenous Zimbabweans were due to come into effect this Thursday.

The Gemany Embassy said it welcomes the “Zimbabwean Government’s decision to suspend and review rules aimed at obliging foreign-owned companies to sell a majority stake to “indigenous” Zimbabweans”.

“Time has now come for a sound and unexcited discussion about the best methods for constructive empowerment which creates new wealth for Zimbabweans instead of destroying existing assets”, says German Ambassador Albrecht Conze.

“Germany is ready to participate in this debate and assist the process where possible.”

International confidence in Zimbabwe as a safe environment for foreign investment had suffered a serious blow through the recent gazetting of regulations providing for compulsory ownership restructuring of foreign owned companies.

“It will take concrete action by the Zimbabwean Government to have this confidence restored. The German business community will continue to assess progress and come back to Zimbabwe with new investments as the rule of law is further restored and property rights fully respected,” the ambassador said.

Despite the suspension, Zimbabwe has already lost millions of dollars in potential investment as international companies chose safer destinations for their investment dollars.

Since the regulations were gazetted in February, the Zimbabwe Stock Exchange (ZSE) fell by as much as 25 percent with investors with-holding about USD 100 million as a direct result of uncertainty created by the publishing of the controversial regulations.

ZSE chief executive, Emmanuel Munyukwi said last month that in the bourse had raked in only about US$5 million while months before that the ZSE was raising more than US$20 million a month.