Of Community Share Ownership Trust

The quest for success…

I might one day own shares in foreign-owned companies operating in Zimbabwe.

At least that was the vision I was infected with when I joined a Community Share Ownership Trust.

The government of Zimbabwe, in its great benevolence, launched the community share ownership scheme in 2011 through Statutory 21 of 2010, as a vehicle that would empower its citizens.

This was in support of the Indigenisation and Economic Empowerment Act of 2008, whereby for a foreign-based company to be legible to do business in Zimbabwe, 51% of its shares had to held locally. Foreign-owned entities were hitherto obligated to dispose 51% stake to locals and at least 10% of this equity was to be spared for the local community in which the firm operated.

Community Share Ownership Trusts would be the investment vehicle through which shares would be acquired and manage funds on behalf of the local community members.  Several Trusts popped up in mining regions with locals set to benefit from the Transnational mining operations in their regions.

Njere Isimba Community Trust

The details of these Trusts were somewhat veiled in secrecy with details of how they were supposed to operate never made publically and it would not be a surprise to find the locals telling you they had never heard of the trust that they were supposed to be benefiting from in their area..

Zimplats Community Share Owner Trust

On this backdrop, I received an invitation to join a Community Share Ownership Trust that was geared for the urban youth and students as the majority of trusts served mining communities. The guys made a compelling pitch about how as an individual one could not simply walk into the offices of a Multi-national firm and ask if they were compliant with the Indigenisation and Empowerment Act and request to see their share distribution structures, but The Trust could.

The founders of The Trust wanted us to sign up en masse because they claimed that the more people who were represented by The Trust, the more negotiating power The Trust would have in leveraging for shares. A recruitment drive was launched where you would get points which would translate into the percentage of the shares you would own for every person you recruited to sign up with the trust…

And of course there was a little thing about subscription fees of $10

Actually, they weren’t subscription as The Trust’s legal counsel had gone to great pains to explain to us. The $10 was a donation to The Trust and as such would not entail any legal obligations or scrutiny as would had they said the money is subscriptions….

“What if you just take our money and run?” A fast thinking observer had asked.

In repsonse, one of The Trust’s founders had delivered an impassioned speech on how he had been deported returned from the United Kingdom with absolutely nothing but $10 000 and a dream and look at him now; he ran a very lucrative Multimedia Advertising Agency. He stressed that to be successful in business you have to be willing to take risks he had risked $10 000, if we weren’t ready to risk a $10 investment, we weren’t ready for the big league and owning shares…

Of course I signed up and paid my donations then enlisted friends and peers to join up; I even paid the subscriptions for some of my sceptical friends, who were clearly not ready for the big league, knowing I would be collecting with interest; when the share dividends started paying out, I would be top of the pyramid….

Multi level marketing

We had weekly update meetings and somehow I had landed a role in The Trust’s committee, I was moving up in the pyramid world, Mr Soon To be Shareholder. Membership reached the thousands. To have time to prepare for the rising numbers, meetings had to shift to fortnightly and then monthly and then to be advised…. And then here we are, still waiting.

In August 2019 government announced intentions to repeal the Indigenisation and Economic Empowerment Act in a move to attract foreign direct investment (FDI) because frankly what investor would want to operate under such a restrictive policy. The Act would be replaced by more “business-friendlyEconomic Empowerment Act in line with the Zimbabwe Is Open For Business mantra.

Effectively Community Share Ownership Schemes have been rendered dysfunctional as industry is not legally compelled to support local community; out of a possible 61 community ownerships trust that were registered, to date only 21 have a semblance of functionality.

Oh, the shares I could have owned…

~B

16 Comments

  1. Oh the pyramid schemes I’ve been asked to join over the years. And as I read your blog, I realise that my sister was scammed by people who said that they can get her house, which she had a mortgage, owned free of charge because of some written unknown law that gives you the right to be the owner or something like that, they even convinced her they would litigate and protest the loan. Meeting after meeting (giving money and more money) she delivered the litigation to the loan company and nothing happened!!

    So very sad, and I was beside myself watching her as she was SO CONVINCED!! Nothing I would say would change her mind. Needless to say, she gave these people thousands of dollars, even telling me she was doing it for me so I could do this too, own my house so I would have no house payments and could quit my job. Oh dear, anything that sounds too good, is just that, too good to be true! She did not give away as much as my best friend, but I seem to be the only one not participating in these schemes. However, I do spend a lot of money on my horses, money pits to be honest – but worth every penny with no schemes!! Lol 🐴🤠😍

    Liked by 1 person

    1. I hate that people can be so eloquent that they can sell you great expectations of grandeur hahaha but also we can be so gullible we even ignore red flags when someone tells you about an investment opportunity that makes 150% profit in just one week….

      You have a good head on your horse!!! No schemes attached ^_^

      Liked by 1 person

  2. Why does this sound like a pyramid scheme. They always come dressed in different clothing and for some reason people are still falling for them til today.
    It’s a sad affair.

    Oh the shares you would have owned indeed

    Liked by 1 person

    1. they will use fancy terms like how its a multi level marketing model but the distribution curve is very much pyramidal

      And I guess when the government is corrupt even the people become corrupt
      ~B

      Like

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