Zimbabwe asks foreign firms to sell 51% shares to locals or face closure

The Zimbabwean government has asked all foreign companies in the country to comply with a law requiring them to sell at least 51 percent of their shares to locals, or face closure.

Youth, Indigenization and Economic Empowerment Minister, Patrick Zhuwawo, on Wednesday announced an April 1, 2016 deadline for the foreign companies to do so, or lose their licenses, the state news agency New Ziana reported.

"Comply by that date or close shop," he said.

There is no estimate of how many firms would be affected.

The law has been controversial since it came into force in 2010, with main areas it targets including mining, agriculture and banking.

There were some major agricultural and manufacturing companies given exemptions, but it is not clear if the exemptions will be revoked this time.

Analysts say the decision has come as another shock to potential foreign investors after the government last month forced main diamond mining companies in the country, mostly joint ventures, to merge into one, of which the state holds a majority stake.

There has been a drop in foreign investment into Zimbabwe over the past three years, partially blamed on the unpredictability of its investment policies. Endit