Sept. 14 (Bloomberg) -- Zimbabwe, which is compelling foreign-owned companies to cede control of their businesses to black citizens of the country, plans to establish a sovereign wealth fund that will hold stakes in mining companies.
The country wants foreign companies including Rio Tinto Plc and Impala Platinum Holdings Ltd. to sell 51 percent stakes in their mines. Zimbabwe has the world’s second-biggest platinum and chrome reserves as well as deposits of gold, iron ore, coal, diamonds and nickel.
“The sovereign wealth fund will hold shares in various mining businesses,” Saviour Kasukuwere, the country’s indigenization minister, told a conference in Harare, the capital, today. “It is a vehicle to ensure that Zimbabwe’s natural resources benefit the whole nation rather than a select few.”
Zimbabwe’s plans to force foreign mining companies to sell control of their businesses has met resistance from companies such as Johannesburg-based Impala, with the company’s Chief Executive Officer David Brown saying last month that the law is blocking investment of as much as $10 billion by the company.
Zimplats Holdings Ltd., a unit of Impala, said today that a threat to cancel its mining license in Zimbabwe has been withdrawn after it held talks with the government following the rejection of its initial proposal. Another proposal is to be submitted.
Community trusts will also be established to hold shares in mining businesses, Kasukuwere said.
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