Chapter 3: An overview of indigenisation and economic empowerment
3.5 Malaysia and the New Economic policy (NEP)
3.6.3 Government reforms and the introduction of IEEP
There are two significant factors that influenced the economic, social and political environment of post independent Zimbabwe. Chowa and Mukuvare (2013:5) state that the fast-track land reform programme and the IEEP were critical in determining the country's trajectory. These two policies, although delayed, formed the core of the reasons for the liberation struggle; that is, self- determination, the proprietorship of the natural resources and the socio-economic emancipation of the previously marginalised indigenous citizens of Zimbabwe.
The land reform programme was implemented following the willing buyer-willing seller strategy that had been utilised since independence but had struggled to resolve the land problem. It had yielded little in terms of the redistribution of the land. This market-based approach to land and agrarian reform had been implemented in accordance with the British negotiated Lancaster House constitution which was designed to allow a progressive transfer of land ownership in a manner that would not adversely affect the economy but more significantly, the white community. Unfortunately, because of the historical background already presented, the indigenous black citizens did not possess the financial means to buy land and as such, this approach failed to adequately achieve its intended goal. The approach proved painstakingly slow, and this eventually led to popular unrest and subsequently to large-scale invasions of white-owned farms by the masses led by the liberation war veterans. Much of the blame for this mass land invasion was targeted at the British government’s
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failure to honour the terms of their agreement with the Zimbabwe and as such, white-owned farms were invaded. After government intervention, the chaotic farm invasions were formalised resulting in 4.37 million hectares of land being reallocated to 114 830 families during the first two years (UNDP;
2002 cited in Chowa & Mukuvare 2013: 6).
The land reform programme is the bedrock of indigenisation. Just a few white people owned thousands and thousands of hectares of land. So government came up with land redistribution so that those who were previously disadvantaged would be farmers. Official 2
The Indigenisation and Economic Empowerment Act (IEEA) was promulgated on the heels of the Land Acquisition Act (15 of 2000), which sought to redistribute land to the black citizens of Zimbabwe, many of whom had been without land. Access to arable land would therefore increase the prospects for the previously marginalised blacks to contribute significantly towards the economic growth of Zimbabwe (Marazanye, 2013:75). The government highlighted that the land redistribution programme was introduced to “fight poverty among indigenous black Zimbabweans, improve the equitable distribution of income and the means of production as well as creating a national bourgeoisie in the country’s agricultural sector” (Government of Zimbabwe, 2004:5). Arguably, the land reform programme in Zimbabwe drastically changed the agricultural outlook with varying and very debatable degrees of success. Inevitably, this programme was a precursor to the IEEP. It was also, without a doubt, a move towards broad based empowerment as women, the youth and the marginalised were active beneficiaries.
While the land reform programme epitomises the empowerment struggle in Zimbabwe, it remained a shining example of the possibility of real economic emancipation and a final resolution to the question of sustained growth with equity. It is upon the backdrop of what the Government of Zimbabwe described as a successful land reform programme, that moves were instituted to increase black participation in other sectors. The act, as argued by Mavhunga (2018:241), is in alignment and in fulfilment of the United Nations resolution 1803(xvii) of 1962 which proclaimed that it is the right of the nation’s people to have “permanent sovereignty over their natural wealth and resources”.
Although the policy framework on the indigenisation of the economy was first mooted in 1998, it was only adopted in 2004. The Government Indigenisation Policy Framework was drafted by Department of State Enterprises and indigenisation in the Office of the President and Cabinet. This framework culminated in the formulation of the National Investment Trust of Zimbabwe in September 2000, whose objective was to support the purchase of company stocks for indigenous investors.
(Department of State Enterprises and indigenisation in the Office of the President and Cabinet, 2004:5).
Nyawuyanga (2015:25) argues that the IEEA was enacted to fast track the reform of the mining sector and support broad economic empowerment. This may have arguably been the most significant purpose of the act as the mineral rich country had found that the sector, although
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particularly important to the economy, was not yielding the maximum benefits to citizens and the national fiscus.
The government identified that there were inhibitive legislature curtailing the entry of indigenous entrepreneurs into different sectors of the economy. These had to be addressed so as to align all
‘preventative’ laws with the post-independence empowerment agenda. Acts such as The Urban Councils and Regional Town and Country Planning Act (22 of 1976) were identified as having been used by the colonial government to disempower the black indigenous population. This Act gave local government the right to regulate the type, location and activities of black-owned businesses yet provide whites carte blanche in business operations. Worse still, this racist Act empowered local government to demarcate certain areas for whites only and any black found moving around these areas would be prosecuted. Other notable inhibitive laws included the Factory Act (20 of 1948), the Public Health Act (19 of 1924), the Liquor Act (9 of 1974), the Banking Act (65 of 1964), the Shop Licensing Act (40 of 1976), the Second Hand Goods Act (25 of 1956), the Income Tax Act (5 of 1967) and the Mines and Minerals Act (21 of 1961).
Table 3.2 Colonial laws that disempowered black Zimbabweans (1889-1979)
Law Summary
Charter of the British South Africa Company (BSAC), 29 October 1889
Backbone of colonialism and black majority disempowerment.
Land Apportionment Act of 1930
Appropriated land in favour of the white minority.
Indigenous people were moved from fertile land to give way to white farmers.
Companies Act (47 of 1951) Stringent company registration measures designed to exclude indigenous entrepreneurs.
Factory Act (20 of 1948) Designed with stringent conditions for registration to exclude blacks
Public Health Act (19 of 1924)
Designed to protect the established white businesses, while black small businesses were subject to harassment for failure to meet the standards required.
Urban Councils and Regional, Town and Country Planning Acts (Act 22/1976]
Gave local authorities powers to regulate the activities of all types of businesses and allocation of certain residential areas for whites only.
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Liquor Act (9 of 1974) The sale of clear beer to blacks was prohibited.
Food and Food Standards Act (25 of 1971)
Designed with stringent conditions for registration to exclude blacks.
Second Hand Goods Act (25 of 1956) [Chapter 293]
Prohibited the importation of second-hand goods and sale thereof. Indigenous Zimbabweans were adversely affected as they had very low income.
Income Tax Act (5 of 1967) [Chapter 181]
This included discriminatory taxes such as the hut, cattle and dip tank taxes, meant to force black people to work for whites, usually for a pittance.
Source: Chipika and Malaba (2013: 45)
Table 3.2 above lists some of the most impactful laws that were enacted by the colonial regime in an effort to promote white supremacy and establish the socioeconomic disempowerment of the black majority. As Zimbabwe gained independence in 1980, the fledgling black majority government was compelled to resolve the colonial history of racial inequalities and marginalisation by enacting a slew of reforms. Among the amendments that were crafted by the new government was the Mines and Minerals Act (Chapter 21:05 of 1961). It was seen as a critical piece of legislation because it had regulated mining activities in colonial Zimbabwe and was seen as a significant impediment to the sovereignty of the resource-rich country and its determination to economically empower its citizens.
This act was amended more than 26 times in post-independence to improve efficacy, sustainability and appropriateness. As already mentioned, the Mines and Minerals Act (Chapter 21:05 of 1961) became the focal point of the indigenisation and economic empowerment agenda as it was hoped that it would allow for a complete realignment in the ownership and management of a sector that was responsible for a significant portion of the country’s wealth and arguably one other most contentious issues that led to the war of liberation.