Zimbabwe’s Indigenisation Shift: Navigating the Three-Year Grace Period
Zimbabwe is entering a transformative phase in its economic landscape following the latest amendments to the Indigenisation and Economic Empowerment Act [Chapter 14:33]. By expanding the list of “Reserved Sectors,” the government has signaled a firm commitment to ensuring local citizens hold the reins in key domestic industries.
However, recognizing the potential for economic shock, the law introduces a structured three-year transition period designed to balance local empowerment with business continuity.
The 75% Divestment Roadmap
For foreign-owned businesses currently operating in these newly reserved sectors, the law does not demand an overnight exit. Instead, it mandates a phased divestment process. Existing enterprises are required to transfer 75% of their shares to Zimbabwean citizens over three years.
To ensure steady progress, the regulations require a graduated approach:
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Year 1: Divestment of the first 25% of shares.
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Year 2: Divestment of an additional 25%.
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Year 3: Final divestment of 25%, reaching the mandated 75% local ownership.
This strategic “glide path” is intended to prevent immediate market disruption, allowing foreign owners time to find suitable local partners and negotiate fair valuations while staying compliant with the law.
Expanded Reserved Sectors: The Finance Act Amendment
The scope of this policy has been significantly broadened through the Finance Act Amendment of the First Schedule of Cap. 14:33. Four specific sub-sectors have been added to the “Reserved/Threshold” list, meaning they are now primarily set aside for Zimbabwean nationals.
| Sector | Scope of Reservation |
| Quarry Mining | Extraction of rock, stone, sand, and gravel for construction and industrial use. |
| Brick Moulding | Shaping bricks from clay or earth, whether by hand or machine, for commercial gain. |
| Granite Mining | Extraction of granite blocks, including exploration and removal of slabs for decorative or industrial use. |
| Travel Agency | Intermediary services for travelers, including booking flights, hotels, and tours. |
Strategic Exceptions and Stability
While the indigenisation drive is accelerating, the government has maintained a level of pragmatism. The regulations clarify that foreign control in “commanding heights” of the economy—specifically large-scale mining and banking—remains unaffected for the time being.
By keeping these capital-intensive sectors open, Zimbabwe aims to maintain international investor confidence and ensure that the core pillars of the macro-economy remain stable while the “Reserved Sectors” undergo local transformation.
Looking Ahead
The full implementation of these rules will be a litmus test for Zimbabwe’s economic policy. Local entrepreneurs view this as a golden opportunity to enter industries previously dominated by foreign capital, while international observers are watching closely to see how the divestment process affects the ease of doing business.
For existing foreign business owners in quarrying, brick moulding, granite, or travel, the clock is now ticking. Success will depend on finding the right local partners to ensure a seamless transition that honors both the spirit of the law and the health of the enterprise.
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