Tawanda Musarurwa, Harare Bureau
Government has resolved to retain just 26 percent in at least three parastatals and/or State enterprises, Finance and Economic Development Minister Mthuli Ncube has said.
Such equity-holding will give Government veto power over what it may consider “prejudicial decisions”.
The parastatal reform process is moving with speed since the Government approved the implementation framework for 43 SOEs and parastatals last year.
Minister Mthuli said Government will maintain 26 percent shareholding in at least three parastatals, namely TelOne, NetOne and the Grain Marketing Board.
“Coming to TelOne and NetOne, these again have been partially privatised. We have made a decision that they are being privatised as a bundle; as a package and as Government, we agreed to sell down our equity down to 26 percent.
“There is something magical about 26 percent equity stake because this is the minimum level you need to be called a significant minority so that you can block any unpleasant prejudicial decisions by the board,” said the Minister in his State of the Economy address last week.
On GMB he said: “We have de-merged GMB into the GMB Strategic Grain Reserve, which is financed directly by Treasury. Every year we make an allocation for that and then the other part is Silo Food Industries, which is a commercial entity.
“The commercial entity began operation formally on April 1, and they are busy right now inviting additional shareholders to invest into the company so that it can expand the product range and boost their working capital, retool, re-equip and begin to compete effectively with peers in the private sector and Government agreed that we lower our equity in the company down to 26 percent of total equity.”
Other enterprises that have been targeted for expedient reform include Telecel, ZIMPOST, POSB, Allied Timbers and the Zimbabwe Electricity Supply Authority among others.
But there is no single formula that will be applied for reformation of all the parastatals.
According to Government, other pasatatals and state enterprises will be privatised and listed on the stock market while others would be split into departments or dissolved completely. It expects to raise at least US$350 million from listing a number of parastatals on the Zimbabwe Stock Exchange.