Politics 13 August 2013 Mugabe is warning off foreign firms Will the new model work for Zimbabwe? Sign up for our weekly email * Print HTML Following their recent election win, Robert Mugabe’s Zanu PF government has issued a new warning to foreign firms. They ran a full-page advertisement in local papers this week saying that their comprehensive election win was an endorsement of their “indigenisation plans” that will see all foreign owned companies forced to give up 51 per cent of their equity to black Zimbabweans. It is expected that this means that Mugabe will force the remaining 1100+ white and foreign owned companies left in the country, as well as local banks with foreign interests, to hand over 51 per cent of their businesses to the Zanu PF government. "Over the next five years, Zimbabwe is going to witness a unique wealth transfer model that will see ordinary people take charge of the economy," the adverts read. Saviour Kusukwere, one of Mugabe’s ministers, revealed separately that the country planned to seize 51 per cent of foreign-owned mines, worth an estimated US$7bn without any compensation. He warned that mines that refused to surrender more than half of their assets would lose their licences. Recent Economic Trends Following the 2000 referendum, Zimbabwe experienced 7 years of negative economic growth, with GDP per capita figures falling from US$535 in 2000 to US$415 in 2008. Then after introducing the US dollar as it currency in February 2009, the country witnessed a resurgence, with GDP per capita levels rising to US$788 by 2012 (Source: World Bank). However, despite this small improvement, most African countries have surged ahead of it over this twelve year period as reflected in the table below. Timeline: Mugabe’s 33 years in power Mugabe and his Zanu PF party took power following the 1980 general elections. Following droughts in the country in the late 90s and slowing economic growth, Mugabe was coming under increasing pressure to step aside. Mugabe then held a referendum in 2000 in order to extend his powers. This referendum was unexpectedly defeated by a new opposition party formed from a labour union movement, the MDC and its leader Morgan Tsvangirai. Months after the referendum, the MDC ran a candidate in every district in the country and emerged with nearly half the seats in parliament. Zanu PF responded by launching a campaign of violence to intimidate the MDC. It also destabilized the country by ordering the invasion of commercial farms by so called War veterans. Following the invasions and general public outcry, new media laws were passed prior to the 2002 elections which led to the closure of all independent newspapers in the country. Zanu PF won majorities in the 2002 and 2005 elections. These results were heavily disputed by the MDC and international bodies. MDC leader Morgan Tsvangirai was severely beaten by government officials in 2007 and his bodyguard, Nhamo Musekiwa, was killed. The MDC won a majority in the 2008 election but they did not achieve over 50 per cent of the vote and a run-off election was therefore required. Prior to the run-off election, Zanu PF launched another campaign of violence against MDC supporters, forcing the MDC to pull out of runoff elections and effectively handing power back to Mugabe. Susan Tsvangirai was killed in a car crash in 2009, which is believed by many to be the work of Zanu PF officials who were attempting to assassinate her husband Morgan Tsvangirai, who was in the same car at the time. He survived. In a deal brokered by South African president Thabo Mbeki following the 2008 elections, Mugabe remained president and kept control over the army and the country as a whole. Mugabe won the recent elections held on the 31st July 2013, taking over 60 per cent of the presidential vote and over two thirds of parliamentary vote. These results have been heavily disputed by the MDC, as well as by various independent bodies and the UK and US government. However, most regional powerhouses including the Southern African Development Community (SADC) and the South African government said the elections were free and fair. In fact, the only African country to officially speak out against the result was Botswana. › There's a nuanced debate on welfare waiting to happen, and Benefits Britain 1949 isn't it Robert Mugabe. Photograph: Getty Images Andrew Amoils is a writer for WealthInsight Subscribe from just £1 per issue More Related articles Jeremy Corbyn has found a vulnerable spot on Theresa May and trade Politicians are worried that their pensions are destroying the planet. Is yours? Nap Store: Where did all these new mattress start-ups come from?