HARARE – Zimbabwe’s miners have asked the government to lower to 15 percent shareholding that foreign-owned mining firms must cede to local blacks under a controversial economic empowerment scheme that Harare has said will target the multi-billion dollar mining industry first.

President Robert Mugabe has insisted that foreign-owned firms must sell at least 51 percent stake to blacks by March 2015 in a programme that has raised fears of a repeat in the key mining and manufacturing sectors of the chaos and violence that characterised the veteran leader’s land reforms that he said were meant to empower black farmers.

The Chamber of Mines – the voice of mining in Zimbabwe – on Wednesday said it was not opposed to economic empowerment but said the decision whether to sell controlling stake to locals should be left to the individual companies and the potential black investors wishing to buy into them.

In addition, foreign-owned mining firms that have invested heavily in building schools, roads, clinics and other social responsibility programmes should earn empowerment points for these, Chamber president Victor Gapare told reporters in Harare.

“We have not said it must not be 51 percent, the decision should be up to the people negotiating,” Gapare said. “We have said 15 percent is the minimum but it can go up to 51 percent. The difference to make up 51 percent can be in terms of credits such as roads, schools, clinics and others.”

Gapare said the Chamber had submitted a paper detailing its proposals to the Ministry of Mines and was waiting for feedback from Mines Minister Obert Mpofu who was still consulting the government over the matter.

The proposed economic empowerment scheme has scared investors who are said to have put on hold several projects until there is more clarity on the scheme.

For example, the country’s largest platinum producer Zimplats Holdings announced about two weeks ago that commencement of a US$445 million project to ramp up production to nearly 300 000 ounces annually would dependent on the firm winning government approval of its empowerment plans.

Zimplats is majority-owned by South Africa’s Impala Platinum, the world's second largest platinum producer.

The empowerment plan has also split Zimbabwe’s fragile coalition government right down the middle.

Mugabe and his ZANU PF party back the plan but Prime Minister Morgan Tsvangirai and his MDC party want the indigenisation programme stopped to allow for more consultation and the drafting of new regulations that will not scare away foreign investors, while allowing for economic empowerment of the majority.

The government last week postponed for the second time the deadline for foreign-owned companies to submit their empowerment proposals to June 30 from May 15.

In addition to mining giants such as Rio Tinto other large multinational corporations that will be forced to cede stake to blacks once and if the empowerment programme gets into full swing include cigarette manufacturer BAT Zimbabwe, which is 80 percent British-owned; UK-controlled financial institutions Barclays Bank and Standard Chartered Bank, Swiss-owned food group Nestlé Zimbabwe and AON Insurance.

However the empowerment laws are silent about where or how impoverished local Zimbabweans will get money to pay for stake in the large mines and industries.

Critics fear Mugabe and ZANU PF want to press ahead with transferring majority ownership of foreign-owned companies as part of a drive to reward party loyalists with thriving businesses.

By Zimonline