columnBy Eric Bloch
SOME weeks back Indigenisation minister, Saviour Kasukuwere, was reported to have made an allusion of himself as the modern-day Adolf Hitler. This column contended that he was achieving, using different means, the decimation of the economy as Hitler had done in post-1945 Germany.
However, not only has the minister assured this columnist that he never claimed to be a modern day Hitler, but several of his colleagues have likewise emphasised that he had been grievously misquoted. Any harm or distress this brought to him by further disseminating the misquote is regretted.
Nevertheless, although the objectives and intentions of Hitler and Kasukuwere had markedly different motivations, tragically the consequences of their policies and actions are alike.
That has been reinforced by President Robert Mugabe's statement last week that he will not rest until 51% of each and every foreign-owned enterprise are in the hands of indigenous Zimbabweans.
At the risk of repetition ad nauseum, it has to be said that substantive economic indigenisation is a prerequisite for the future wellbeing of the majority of Zimbabweans.
It is not only necessary for democracy's sake, but is also an essential element for the economy's recovery.
Major economic growth will not be forthcoming without a majority of the population being economically active. The majority's economic wellbeing should be able to exceed the poverty datum line.
However, that cannot be achieved when foreign investors are forced to either pull out or transfer the controlling interest in existing enterprises to a few well-connected people.
That cannot be a basis for any substantive economic advancement for the majority of the population. That action merely enriches the few who are, in most instances, already well-endowed.
Although Zimbabwe has vast potential wealth in its natural resources, it cannot exploit them without considerable investment which is currently not in the hands of Zimbabweans. This is coupled by a dearth in the requisite technology as well as the technical and managerial skills.
The harsh reality is that very few people are prepared to invest their funds and resources into ventures wherein they will have minimal control over their investments and the utilisation thereof. They would also not know to whom majority control will be vested, their "partners" abilities and their business ethics.
Instead, they are more likely to seek for more desirable investment opportunities elsewhere. This tragic, but understandable investor viewpoint applies similarly to international developmental assistance, to loan funding and supplier lines of credit. As long as government fails to recognise that reality, the economy can only continue, at best, in its existing, weakened and emaciated state. With time it would decline further, thereby intensifying the misery and hardships of the masses.
The proponents of the prevailing indigenisation policies also have many other misplaced conceptions. They dogmatically believe that their policies are wholly justified by virtue of the national resources availed to the enterprises.
They claim Zimbabwe's absolute right and title to the resources upon which the enterprises which are to be indigenised are dependent.
Whilst it is indisputable that the natural resources are an integral part of Zimbabwe, the proponents of this notion ignore the fact that more often than not the government is not even aware of those national resources, their whereabouts and extent. Such information is generally ascertained by intending investors at great expense.
The proponents give no recognition to the revenue inflows to the exchequer through investors' ventures. These include payment for prospecting rights, mining licences and rights, income and withholding taxes as well as royalties at far greater levels than prevail in most other countries among many others. They also ignore the major fiscal benefits that flow from job creation and from the downstream economic activity that emanates from such investments.
In fairness, it must be recognised that it is not only this stance that has repelled the desperately needed foreign and direct investment. The endless political instability, because of the failure to fully implement the Global Political Agreement as well as the endless disputes on the formulation of the constitution all contribute to investor insecurity. Added to this is the government's continued failure to honour its obligations under the Bilateral Investment Promotion and Protection Agreements to which it is a party.
Similarly, taxation policies are not conducive to investment promotion, being unduly oppressive, and uncompetitive with other countries seeking investment.
The policies are not only extremely harsh, and involving taxes at markedly greater levels than prevail elsewhere, but are also almost devoid of incentives to motivate and encourage investment. This pertains to Zimbabwe's direct and indirect taxes, and to the many other imposts which are suffered by private sector enterprise.
The consequences, albeit unintentional, are very similar to those of Hitler's rule. Vast numbers of people are suffering immensely while many die prematurely.
An economy with great potential is not realising its potential. The minister and his colleagues may not be modern-day Hitlers, but the consequences of their policies and actions will be somewhat similar to those Hitler inflicted upon Germany.