Should Zimbabwe’s indigeni- sation law – currently the subject of a consultation process – be implemented, Pretoria Portland Cement’s (PPC’s) Zimbabwe operations will probably “grind down over time”, says PPC CEO Paul Stuiver.

The controversial law, if implemented as it is currently written, will see foreign firms cede 51% of their shares to locals.

“The law certainly has affected business confidence,” says Stuiver.

He says the dollarisation of the Zimbabwean economy, following rampant inflation on the Zim- babwe dollar, last year saw a “massive increase” in cement demand.

PPC produced 5 000 t of cement in Zimbabwe in January 2009, but ended the year between 30 000 t and 40 000 t output a month.

“Then, in March this year, we saw a 10% drop in demand. The announcement dented our business,” says Stuiver.

“There is concern on our side that this Bill is not a business-friendly Bill.

“There is huge uncertainty at the moment. We hope to see some sense prevail.”

The indigenisation law came into effect on March 1, and would have affected foreign-owned firms valued at $500 000 or more. However, its implementation was suspended in April, with calls for more widespread consultation as long-time rivals Prime Minister Morgan Tsvangirai and President Robert Mugabe differed on its content.

Stuiver says PPC will work with any new commercial partner in Zimbabwe, but notes that any new 51% shareholder will need to come up with the equivalent percentage of capital for any investment requirements.

To subscribe to Engineering News's print magazine email subscriptions@creamermedia.co.za or buy now.