Wayne Lumbasi
In a decisive move to reshape its economic landscape, Zimbabwe has announced new regulations requiring foreign-owned businesses in certain sectors to cede majority control to Zimbabwean citizens within the next three years. The policy is part of the government’s renewed push for economic empowerment and local ownership, aimed at giving Zimbabweans a stronger foothold in the country’s commercial activities.
Under the new rules, a range of sectors has been designated as “reserved” for local entrepreneurs. These include hair and beauty salons, bakeries, small-scale mining, advertising, transport services, borehole drilling, and retail businesses, among others.
Foreign businesses currently operating in these areas are given a three-year grace period to comply, during which they must gradually divest at least 75% of their ownership to local partners. This phased approach is intended to ensure a smooth transition without causing abrupt disruptions in business operations.
For sectors not fully reserved, foreign investors are not entirely excluded but are required to meet strict thresholds. To maintain a foothold in these industries, investors must demonstrate significant capital investment and create substantial employment opportunities for local citizens. For example, retail or wholesale businesses must invest a minimum of $20 million and employ at least 200 local staff, while logistics and transport sectors require $10 million in investment and 100 employees.
The government says the policy is designed to boost domestic entrepreneurship, create jobs, and ensure that Zimbabweans have meaningful participation in the economy. Proponents argue that reserving sectors for locals will empower small and medium enterprises, reduce reliance on foreign operators in everyday services, and generate wealth within the country.
This move marks the latest chapter in Zimbabwe’s long history of economic indigenisation policies, dating back to the 2000s. The government faces the delicate task of balancing its goals of local empowerment with the need to maintain an attractive environment for foreign investors, who remain crucial for economic growth, especially in capital-intensive sectors.
As the three-year deadline approaches, both local and foreign stakeholders will be closely watching how the policy is implemented. The coming years will reveal whether Zimbabwe can successfully empower local businesses while sustaining investor confidence in an economy still striving for stability and growth.
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