From VenturesAfrica. Story by George Mpofu.

Zimbabwe’s government said it will relax laws guiding foreign investments into the country, especially the controversial Indigenization and Economic Empowerment law, which forces foreign companies to give the majority of its shares to locals.

“Next year when both the industry and commerce come back to work we should be pronouncing new policies more biased towards relaxation,” the country’s new Vice President, Emmerson Mnangagwa, told a meeting of business people. “What we believe is to make investors more comfortable and make investment easy.”

Under the Zimbabwe Indigenization and Economic Empowerment Act, foreign-owned firms must put 51 percent of their shares in the hands of black Zimbabwean investors. But economic analysts say the program is driving investors away and weighing on the fragile economy.

Some foreign companies have already been forced to set up community share trusts and workers’ ownership schemes as a form of empowerment credit rather than parting with shares.

It also remains to be seen whether Zimbabweans will raise the required funds to buy equity stakes in foreign-owned companies. The majority of Zimbabweans are currently living below the poverty datum line of $590 per month for an urban family of six.

Hyperinflation in Zimbabwe was a major problem from 2003 to April 2009, when the country suspended its own currency. Zimbabwe faced 231 million percent peak hyperinflation in 2008.

Read more at VenturesAfrica.