Zimbabwe to sell shares in state-owned firms

Zimbabwe is looking to sell shares in 35 state-owned firms.

17 April 2018 | Economics

"The Special Economic Zones Authority will merge with three others, inlcuding the Zimbabwe Investment Authority to provide a one-stop shop for investors". - Patrick Chinamasa, finance minister, Zimbabwe

Zimbabwe is planning to sell shares in 35 state-owned firms including telecoms and mining entities in the latest step to revive the economy under new political leadership, finance minister Patrick Chinamasa said on Friday.

President Emmerson Mnangagwa, who came to power in November after a de facto military coup forced Robert Mugabe to resign, has made reviving the economy his top priority.

Chinamasa told reporters that Mnangagwa’s cabinet had on Tuesday decided the government would partially sell some shares in a range of state-owned companies, known locally as parastatals.

This would be done through engaging strategic partners and floating shares on the local stock exchange.

Targeted firms include mobile carriers NetOne and Telecel, fixed line operator TelOne and savings bank POSB, all owned by the state. Shares in 17 government-run mines would also be sold.

Like most parastatals, the mines, which mainly produce gold, have struggled over the years due to lack of capital and mismanagement, forcing some to close.

Chinamasa said the parastatal reform was “designed to enhance peformance, improve services delivery and to bring more order, discipline and rationality to the sector as a whole.”

Government ministries would present privatisation plans to cabinet for each entity within 100 days, Chinamasa said.

Some state regulators will become government departments while others will merge to save costs and minimise bureaucracy.

The Special Economic Zones Authority will merge with three others, inlcuding the Zimbabwe Investment Authority to provide a one-stop shop for investors, Chinamasa said.

“It is the right thing to do but the government should go a step further and say ‘we are moving out altogether’ out of these companies. When government is a shareholder they are seen by investors as a source of difficulty rather than assistance,” John Robertson, a Harare-based economic analyst, said.

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