Lebogang Boshomane

Zimbabwe can leverage its natural resources to settle its debt and harness development if it carefully enters into deals with foreign firms, Zimbabwean Deputy Prime Minister Mutambara said.

Addressing a seminar on “Debt, diamonds and development in Zimbabwe,” Mutambara said one “good” deal could offset the country’s sovereign debt of US$9,1 billion, Zimbabwean newspaper The Herald reported.

Mutambara said that the country was losing billions of dollars in “bad” mining deals and Government would soon revisit these transactions. He also stated another problem was that big foreign mining companies were not declaring the value of the unmined assets.

The country is currently recovering from a decade-long economic collapse

President Robert Mugabe recently told foreign firms to form partnerships with Zimbabweans to secure their investments under new rules requiring them to cede majority stakes to locals.

"It's our vision to see partnerships between rural communities and non-indigenous investors to guarantee the security of foreign investment and the establishment of up and downstream industries," Mugabe said.

All foreign companies in Zimbabwe are required to cede 51 percent of their shares to local blacks under a law that has been criticised by firms at a time when the country is looking for investment.