A Legal Avenue for the Zimbabwe Investment Recovery Programme

Abstract

This research paper is a critical evaluation of the current investment policy and legislation. The writer discusses how the economic democratisation initiative by way of indigenisation hampers foreign direct investment. Indigenisation is spearheaded by the Indigenisation and Economic Empowerment Act which effectively legitimises direct expropriation of all foreign owned business enterprises by awarding 51% of shareholding to indigenous Zimbabweans. The government justifies this strategy as a means to address the economic imbalances of the colonial era by empowering the indigenous. The initiative comes when the Ministry of Economic Planning and Investment Promotion, has also been mandated to spearhead an investment promotion program that aims at attracting foreign direct investment. It shall be argued therefore that the investment policy in total is fraught with fatal contradictions that could spell irrecoverable harm for foreign direct investment for Zimbabwe. It shall be argued that indigenisation, though noble cannot be implemented in this manner within the mainstream of investment promotion and protection. The scope of this evaluation shall include an investigation into Zimbabwe’s responsibilities as a capital importing state under Public International Law where expropriation is concerned. It shall also encompass a critique of the Indigenisation and Economic Empowerment Act with a direct comparison with the Islamic Republic of Iran investment legislation namely; Foreign Investment and Protection Act of Iran (FIPPA) as well as the Black Economic Empowerment Act (BEE) of South Africa.