Friday, February 4, 2011

Update on the correct implemantation status of the Indigenisation and Economic Empowerment Programme

As the responsible Minister of Youth Development Indigenisation I wish to update the public on the correct implementation of the indigenisation and Economic Empowerment Programme

Sector Specific Committees
In accordance with Indigenisation and Economic Empowerment General Regulations of 2010 as amended, thirteen sector specific committees were established in August 2010 whose terms of reference were as follows
  • Consult with respective sectors and make appropriate recommendations regarding minimum net asset value threshold above which a business in the sector or sub sector concerned is required to comply with the regulations,
  • Recommend the lesser shares, maximum time periods for compliance and weightings to be assigned to socially and economically desirable objectives, and
  • Recommend policy strategies to overcome specified barriers and challenges in any sector or sub sectorPublish Post of the economy
The sector committees completed and submitted their reports end of November 2010. The mining sector committee report has since been analysed and presented to cabinet for consideration and the following was agreed upon:
  1. That the percentage of indigenous shareholding be as follows: 100% for alluvial diamonds; 51% for other diamonds and minerals and 51% for all new investment in the mining sector;
  2.  That share ownership trusts be entitled to 10% of profit before tax for reinvestment in the community in accordance with section 14B of the Indigenisation and Economic Empowerment (General) Regulations 2010 as amended;
  3. Defer implementation of empowerment of empowerment credits pending further reflection;
  4. That a sovereign fund be created for the mining sector;
  5. To approve the proposed timeframes, thresholds and lesser shares
Gazetting of sector specific general notices

In order to implement these decisions, cabinet further instructed formulation of clear implementation modalities. Therefore, to facilitate gazetting of sector specific general notices, work is in progress to align the sector committee reports with various sector legal instruments, policies and also regional best practices in order to achieve the objectives of indigenisation and economic empowerment act. Once consultations on modalities are completed and cabinet approval is obtained. I shall proceed to gazette comprehensive sectoral general notices implementation modalities.

Currently work is at an advanced stage to finalise consultations on the mining sector with a view to publish the gazette for the sector not later than the end of February 2011.

Pending publication of sectoral gazettes that will be supported by respective charters, all businesses that are not compliant with the law and have not submitted their provisional indigenous implementation plans are required to do so.

Please be guided accordingly

Hon S Kasukuwere (M.P)
Minister of Youth, Indigenisation and Empowerment