Commercial Farmers' Union of Zimbabwe

Commercial Farmers' Union of Zimbabwe

***The views expressed in the articles published on this website DO NOT necessarily express the views of the Commercial Farmers' Union.***

Empowerment rules: Zim to set up equity fund

Empowerment rules: Zim to set up equity fund

Sunday, 11 September 2011 15:54

ZIMBABWE is set to establish a Sovereign Wealth Fund (SWF) to hold shares in 
various entities acquired by the government under the empowerment 
legislation signifying its intentions to move ahead with the programme that 
has rattled foreign investors.

The move comes after major mining companies buckled under pressure and 
resolved to sell controlling shareholding to locals in line with the 
Indigenisation and Economic Empowerment Act.

Initially, mining houses under the Chamber of Mines umbrella had offered 26% 
to locals. According to information obtained last week, the country’s SWF, 
Zimbabwe Investment Corporation (ZIC) will be launched before the end of the 
year to house resources for the future generation.

The fund will be the baby of the Ministry of Youth Development, 
Indigenisation and Empowerment with oversight responsibility from the 
Ministry of Finance. ZIC will hold shares in various entities acquired by 
government as part of the empowerment legislation as well as revenue from an 
SWF super tax of 5% on mineral production.

It also seeks to raise over US$5 billion in assets over the next three to 
five years. An independent body would be established to oversee the 
management of the fund.
Before the fund is lau-nched, the promoters would visit renowned funds in 
Asia and the Middle East.

In Asia, the team would visit the Singapore Investment Corporation and China 
Investment Corporation. In the Middle East, the team would visit Abu Dhabi 
Investment Authority (ADIA) and Qatar Investment Authority.

ADIA is the world’s largest fund with assets of over US$620 billion. There 
are currently 51 funds with combined assets of over US$4 trillion. According 
to the Sovereign Wealth Fund Institute (SWFI) since 2005, at least 19 funds 
have been created.

SWFI studies the funds and their impact on global economics, politics, 
financial markets, trade and public policy. It said globally, the financial 
and utility sectors in direct investments were white hot for sovereign 

“In the first half of 2011, US$7, 09 billion was invested by SWFs in the 
financial sector. “This was followed by U$3,13 billion in utilities. 
Year-to-date from 2011, we have recorded US$3, 41 billion in energy sector 
direct transactions,” it said.


An SWF is a state-owned investment fund composed of financial assets such as 
stocks, bonds, real estate or other financial instruments funded by foreign 
exchange assets.

SWFs may be created through commodity exports, either taxed or owned by the 
government or non commodities through transfers of assets from official 
foreign exchange reserves.


Govt amends Indigenisation Act

Govt amends Indigenisation Act | The Chronicle   Minister Patrick Chinamasa Oliver Kazunga, Senior Business ReporterGOVERNMENT has amended the Indigenisation and Economic Empowerment Act in line

Read More »

Govt, BAT in agric empowerment drive

Govt, BAT in agric empowerment drive February 9, 2017 Features, Opinion & Analysis Sydney Kawadza Senior Features WriterIn 1995, Laxer Matemayi completed her Ordinary Level education

Read More »

Joint Venture Act gazetted

Joint Venture Act gazetted June 1, 2016 Business Martin Kadzere : Senior Business Reporter THE Joint Venture Act, expected to promote major investment across economic sectors, came

Read More »

New Posts: