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- may peace, truth and justice prevail.

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Reserve Bank: Act Now to Arrest Illegal Forex Deals

The Herald (Harare)

August 29, 2003
Posted to the web August 29, 2003

Harare

REVELATIONS by the Reserve Bank that some financial institutions have
continued to flout the Foreign Exchange Control Regulations by deliberately
engaging in illegal foreign currency transactions, makes sad reading.

The development comes at a time when the public was losing confidence in the
banking sector.

It is common knowledge that most financial institutions are no longer
serving the interests of their clients.

The commercial banks have developed a habit of charging exorbitant ledger
fees even to those clients whose accounts have been lying dormant for some
time.

It is not surprising that if one were to deposit say $100 000 and keep it
untouched for two months, he would find the balance having gone down to
cater for the so-called ledger fees.

Rip-off is perhaps the best term to describe the existing relationship
between bankers and their clients.

Financial institutions' deliberate engagement in illegal foreign currency
transactions is probably going to far.

Although banks can charge exorbitant ledger charges, while hiding under the
Banking Act, and get away with, perhaps the time has come for the central
bank to read the riot act to the culprits once and for all.

Currently, culprits are either asked to pay a financial penalty or have
their foreign currency licence withdrawn in terms of Section 37 of the
Exchange Control Regulations.

Central bank officials warned this week that they will disregard the first
option and go for automatic cancellation of trading licences of the
culprits.

Indeed, the time has come for banking officials to be told that engaging in
illegal foreign currency dealings is criminal.

Those who have transformed banking halls into dark alleys to engage in shady
deals must be brought to book.

The Reserve Bank should be commended for giving a timely warning to the
culprits.

There are provisions in the Exchange Control Act, which allows for the
punishment of offenders by a jail term.

One hopes that the central bank will carry out its threat to bring normalcy
in the once respectable banking sector.

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Major Retailers Accept Travellers' Cheques

The Herald (Harare)

August 29, 2003
Posted to the web August 29, 2003

Alice Magureyi
Harare

MOST major retailers are now accepting local Zimbabwe dollar travellers
cheques as a form of payment following an initial resistance.

The Reserve Bank of Zimbabwe introduced the local travellers cheques a few
weeks ago as part of measures to contain the bank notes shortages that has
gripped the country.

Some retailers were refusing to accept the cheques as payment for goods and
services arguing that they did not have information on how the cheques were
used.

However, following advertisements by the central bank in both the electronic
and print media, retailers and other businesses are now accepting the
cheques as a form of payment.

Among retailers who have been putting Press advertisements advising the
public that they could now use the cheques to buy from their shops are House
of Kumali, Radio Limited, CW Stores, Creative World and Blooms Furni- shers.

"The new local Zimbabwe travellers cheques are accepted for
purchases/payments for all your clothing, furniture and electrical goods
from any of our branches nationwide," Creative World and CW Stores said in
their advert.

"We could not accept these cheques in the first place because we were afraid
that some of them could be fake," said a creditors' clerk at House of
Kumali.

However, a Radio Limited official said they had been accepting the cheques
since their introduction.

"We have always been accepting these cheques since their introduction
because we feel that they are convenient to our customers", said Mr William
Musamba, the manager for Radio Limited.

The travellers cheques are sold to account and non-account holders by
financial institutions and are found in denominations of $100 000, $50 000,
$20 000, $10 000, $5 000 and $1 000.

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Service Stations Sell Fuel At New Prices

The Herald (Harare)

August 29, 2003
Posted to the web August 29, 2003

Harare

A few service stations yesterday started selling fuel imported by oil
companies but most said they would not receive supplies until next week.

The Government has ended Noczim's monopoly on procurement and the oil
companies have undertaken to sell petrol at $1 170 a litre and diesel at $1
060 a litre.

These prices are half to two thirds what some oil importers have been
charging for the private imports that have supplied most private companies
and motorists for several months.

Noczim will continue to supply the Government, parastatals and public
transport operators at the old prices of $450 a litre for petrol and $200 a
litre for diesel.

Despite this undertaking, many commuter omnibus operators more than doubled
their fares yesterday, although such hikes are illegal unless authorised by
the Government.

While most filling stations in Harare still did not have fuel yesterday, a
few had started selling petrol at the new prices.

Market Service Station along Robert Mugabe was selling petrol and a queue
had formed at the filling station when The Herald called in.

"This is better. If fuel is found at service stations the black market will
be destroyed. If this continues, the situation in the country will improve .
. . the deregulation of petroleum products is a welcome development," said
one motorist.

Attendants at the service station said they had received about 5 000 litres
from their headquarters in Birmingham.

However, attendants at other filling stations said they had been told to
expect fuel next week.

On Wednesday, private oil companies said the supply of fuel would take time
to normalise given the severity of the situation.

The country started experiencing fuel shortages at the end of 1999 because
of the shortage of foreign currency.

Individuals and other companies who were importing fuel were taking
advantage of the situation and selling it at prices similar to those being
charged on the black market.

Until the introduction of a dual pricing system, petrol was being sold at
between $1 800 and $2 500 a litre while diesel was going for between $1 500
and $2 000 a litre.

Under the two-tier pricing system, fuel imported by the National Oil Company
of Zimbabwe would be reserved for targeted sectors such as farmers,
Government institutions and quasi Government organisations at the gazetted
prices.

The Government on Wednesday deregulated the procurement of petroleum
products in a move expected to improve fuel supply in the country.

All registered oil companies will import their own fuel and sell directly to
the public at economic prices through approved outlets.

There have been mixed reactions over the deregulation.

While some players in the business sector hailed the move saying it would
improve fuel delivery in the country, others feared the oil companies might
fail to get enough foreign currency to import fuel.

Economist Mr James Jowa said the increase in the price was likely to lead to
increases in prices of other commodities.

"If supply does not improve as anticipated, which is very likely, the price
of fuel will be forced further upwards.

"The cost of production will rise and the exchange rate will be affected,"
he said.

However, others commended Government's decision saying the prices announced
by the private oil companies were reasonable taking into consideration the
fact that businesses were getting fuel at parallel market rates, which were
exorbitant.

"It is an advantage to us and better for most businesses since the prices
that have been announced are much lower than those that were charged at the
parallel market," said Zimbabwe National Chamber of Commerce national
co-ordinator Mr Luckmore Zinyama.

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MSNBC

Zimbabwe govt, opposition fight key local polls

By Cris Chinaka

HARARE, Aug. 29 — Zimbabwe's ruling party faces a crucial test in urban
council elections this weekend in the face of a deepening economic crisis
and an opposition with strong support in the country's major towns.

       Political analysts say President Robert Mugabe's ZANU-PF party goes
into the two-day polls on Saturday as the underdog after losing a majority
of the urban seats to the opposition Movement for Democratic Change (MDC) in
general parliamentary elections held three years ago.
       Since the June 2000 parliamentary elections, the two parties have
fought several elections, with the MDC winning most of the urban contests
while ZANU-PF has retained national control with votes from its traditional
stronghold in the rural areas, home to about 65 percent of the population.
       But the MDC charges that Mugabe and ZANU-PF, in power since
independence from Britain in 1980, have cheated and used violence to win
elections in the last three years.
       MDC leader Morgan Tsvangirai has a pending court challenge against
Mugabe's re-election in presidential elections in March 2002, which many
Western powers say were rigged.
       Opposition victory in the council polls would expand the MDC's
symbolic control of major towns -- Harare, Bulawayo, and Masvingo are
already under its wings -- but the government has imposed central control of
local municipalities through sweeping powers held by the minister of local
government affairs.
       Opposition gains would also be an obvious setback for Mugabe, who
insists he still enjoys majority support.
       The MDC says ZANU-PF has been using intimidation to win some of the
eight mayoral and 130 council seats being contested in 16 towns around the
country. There are also two parliamentary by-elections, one in the capital
Harare and the other a rural constituency in northwestern Zimbabwe.
       Political analysts say ZANU-PF has been running a low-key campaign
which appears designed to allow the government to play down any big
opposition victories.
       ''I think ZANU-PF knows very well that the urban council elections
are very difficult for it because of the economic problems, and they will
probably be happy to pick what they can,'' said Lovemore Madhuku, chairman
of political pressure group National Constitutional Assembly (NCA).
       Zimbabwe's major towns have suffered the brunt of a serious economic
crisis which has brought severe fuel and banknote shortages and soaring
inflation, now at about 400 percent.
       ''ZANU-PF has been using its usual crude tactics, violence,
intimidation and tampering with vote registers...but we are still confident
of winning these elections,'' MDC election director Remus Makuwaza told
Reuters this week.
       But ZANU-PF spokesman Nathan Shamuyarira denied charges that the
ruling party was employing violence and intimidation.
       ''This is a sickening song that we are subjected to at every
election, and the song is clearly meant to tarnish our image.
       ''The courts are there to sort out any genuine grievances, but the
MDC must stop making false claims for their failure to win voters,'' he
said.

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Cape Argus

      SA land of hope for Zimbabwe workers
      August 29, 2003

      Zimbabwean Kenneth Khumalo has worked in South Africa for nearly a
decade and says the turmoil at home is unlikely to see him return any time
soon.

      With unemployment hovering above 70%, many Zimbabweans have sought
work in South Africa and Botswana while thousands of others have gone as far
as Britain, the United States and Australia.

      The Zimbabwean exodus has gathered pace as President Robert Mugabe's
government faces its sharpest economic and political crisis since
independence from Britain in 1980.

      While Mugabe and his political opponents wrestle over how to pull the
country out of its mess, more and more Zimbabweans are voting with their
feet - joining a flow of economic refugees that poses new problems for both
Zimbabwe and its neighbours.

      Khumalo, born Kenneth Sibanda, adopted the more South African surname
Khumalo to get "more of a South African feel", an indication he is ready to
stay in his adopted country.

      "I still have friends and relatives in Zimbabwe, but I only see them
once a year at Christmas. There is nothing to draw me back home
permanently," said Khumalo, who left Zimbabwe's southwestern city of
Bulawayo after leaving school in 1992.

      Mugabe's critics, led by the opposition Movement for Democratic Change
(MDC) say he has mismanaged the country during his more than two decades in
power, leading to acute shortages of foreign currency, food, fuel and -
increasingly - patience.

      White-collar Zimbabweans, who once enjoyed one of Africa's most
promising economies, have seen their standard of living drop and many are
now leaving the country to take up menial jobs abroad working as bus
drivers, street cleaners and hotel workers, often illegally.

      "It is hard sometimes, you never completely get over the
homesickness," said Khumalo, who said he was in South Africa legally.

      The influx of Zimbabweans has raised hackles in South Africa, which
has its own serious unemployment problem and where locals increasingly
accuse foreigners of taking scarce jobs.

      Figures from South Africa's latest national census show that 41.6% of
adult South Africans lacked formal work in 2001. Among majority blacks, one
in two people were unemployed.

      South African statistics say almost 47 000 Zimbabweans were legally
resident in the county in 2001, but officials estimate that about one
million more are in the country illegally and say some 3 000 to 4 000 are
deported each month.

      Zimbabwe, too, is struggling to cope with what amounts to a serious
brain drain.

      The country's health and education sectors have been hit particularly
hard as salaries for teachers and medical workers fail to keep pace with
Zimbabwe's rocketing inflation, currently rated among the highest in the
world at nearly 400%.

      Zimbabwe government doctors went on strike in June, complaining that a
recent evaluation and pay review
      of public sector jobs had whittled away their already unsatisfactory
monthly wage.

      The Harare-based Scientific and Industrial Research and Development
Centre says more than 479 000 Zimbabweans work outside the country, mainly
in South Africa, Botswana, Britain and the United States - but the
opposition and human rights agencies say the hardships at home have driven
many more people out.

      South Africa is the nearest land of opportunity and has the added
advantage of allowing Zimbabweans to visit home regularly and send back
essential commodities unavailable there.

      Work may be better in South Africa, but many Zimbabweans still long to
return home and avidly read Zimbabwe's newspapers online to track political
and economical developments.

      "It all looks gloomy at the moment, but I believe one day I will be
able to return to a more prosperous Zimbabwe," said Thulani Dube, another
Zimbabwean who works at the same hotel as Khumalo in Johannesburg's posh
Sandton district.

      Zimbabweans abroad remain divided about what has brought their
homeland so low. Khumalo and Dube agree that whoever is to blame, the road
to recovery will be long and hard. - Reuters

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Chissano Defends Land Reform in Zimbabwe

Agencia de Informacao de Mocambique (Maputo)

August 29, 2003
Posted to the web August 29, 2003

Harare

Mozambican President Joaquim Chissano reiterated in Harare on Friday that a
fair redistribution of land and its correct utilisation are essential
aspects in the fight against hunger and poverty in Africa.

Speaking during the official inauguration of the Agricultural Fair in
Harare, Chissano said that this is why he wishes that the government of
President Robert Mugabe be well succeded in allowing all the people access
to land, without any kind of discrimination.

During a ceremony where Mugabe did not speak, Chissano said that time has
come for Africa to face agriculture as an important instrument to promote
development.

He stressed the need for the Africans to share a common vision when faced
with this kind of problerms.

Before his speech, Chissano had visited the different pavillions in the
fair, and recalled that in past years, Zimbabwe would be the regions' burn,
saying that even with the problems it is facing today, the Southern African
development Community (SADC) still faces it as essential in its strategy for
the regional food security.

In his speech, Chissano encouraged the Zimbabweans not to faulter, but to be
ready to fight for the consolidation of their political and economic
independence.

He also aknowledged the Zimbabwean society's efforts to conquer their social
and economic problems caused by the land reform and the subsequent sanctions
imposed by the western countries, compounded by the drought that affects the
entire southern African region.

Chissano also noted that agricultural problems are not exclusive to
Zimbabwe, but affect the entire continent, recalling that, for instance,
during the 1990s, there was an increase in the food imports.

He said that the number of mal nurished people grew from 173 million to
about 200 million in 1999, of which 194 million were in sub-Saharian Africa.

Chissano also noted that the lethal disease AIDS is threatening Africa's
development programmes, and that it has killed nearly seven million workers
in the agricultural sector in the sub-Saharian Africa sence 1985, and
another 16 million are at risk of dieing before 2020.

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News24

Democracy - Mugabe-style
29/08/2003 20:55  - (SA)

Harare - Cities, towns and villages across Zimbabwe were bracing themselves
Friday today for what has become a depressingly familiar round of violence,
fraud, bribery and corruption - democracy Robert Mugabe-style.

His ruling Zanu-PF party is facing opposition leader Morgan Tsvangirai's
Movement for Democratic Change in two parliamentary by-elections and local
council and mayoral elections in 16 urban areas over the two-day weekend.

A total of 279 seats are being challenged, and Mugabe is leaving nothing to
chance, according to political analysts. Already, the ruling party has
ensured that there will be no vote for 46 of the seats.

The MDC candidates were forcibly stopped from registering or terrorised into
withdrawing afterwards, and the ruling party candidates were declared
"elected unopposed".

"It's the same old thing all over again, brutality and cheating from start
to finish," said University of Zimbabwe political science professor Eliphas
Mukonoweshuro.

"Only this time, they are doing it publicly, and making no effort to hide
it. They don't care any more. They've got away with it for so long they know
they can do it with impunity."

A major obstacle to the ruling party's aims - the independence of election
officials - was dealt by a high court judge on Wednesday this week.

Blatant violation

He delivered a ruling that gave the regime the nod to appoint army officers,
policemen and state intelligence agents to run the elections, in what
lawyers said was a blatant violation of electoral laws.

Judge Tedias Karwi said that the MDC's application to bar state security
officers was "not urgent" and did not need to be heard before the weekend.

On Friday, high court judge Ben Hlatshwayo, who openly professes support for
the ruling party, sorted out another formality.

He dismissed, with costs, an application by the MDC to order election
authorities to allow 11 MDC candidates in the town of Chegutu about 10km
west of Harare to register for the elections after failing to file their
nominations five weeks ago.

The court heard evidence that the 11 arrived at the court and found it
surrounded by a mob of ruling party youths. Police refused to break up the
mob, so the candidates tried to march in.

All but one had their nomination papers torn to shreds and all were
assaulted. Four of them had to be treated in hospital for broken limbs and
other injuries that medical reports said were caused by bricks and heavy
poles.

The one who made it inside was able to register, but withdrew the same day.
He told the Election Supervisory Commission, the state-run election
watchdog, he was "in fear for his life".

Improperly registered

Police fired shots in the air during the fracas. The commission reported
that the atmosphere around the nomination court was "calm and collected".

Difficulties with the voters' roll have also been settled, according to the
MDC. The party's elections director, Remus Makuvaza said there was evidence
of 20 000 new names on the voters rolls for the constituencies and councils
involved who have been "improperly" registered.

A check by the MDC showed the new voters either lived outside the areas they
were entitled to vote in, were given vague addresses, like military
barracks, or could not be traced at all.

Makuvaza says there have been a sudden rush of thousands of ruling party
supporters into the contested areas.

At the same time, in the parliamentary constituency of Harare Central where
Zanu-PF faces certain defeat - it received a third of the votes won by the
MDC in last year's presidential elections - the names of about 1 700 voters
have disappeared from the roll.

The mostly whites, as well as Susan Tsvangirai, the wife of the MDC leader,
all of whom could be expected to vote for the MDC, said Makuvaza. Issues
like the MDC candidates' campaigns and the attitudes of voters also appear
to have been attended to.

The MDC reported Friday that its candidate in the parliamentary by-election
in the Makonde district in the remote north of the country had been arrested
on Thursday and detained for five hours by police when he drove through as
village where ZANU(PF) was having a campaign rally.

Police told MDC lawyers that his presence there was "likely to incite
violence", said MDC spokesperson Paul Themba Nyathi.

'Positive persuasion'

Party supporters' homes in nearly every contested area have been attacked,
and party members have been abducted. On Thursday police in Kariba arrested
the MDC mayoral candidate's election agent and his polling agent.

Nyathi recalled that during last year's presidential elections, thousands of
party polling and election agents, whose job was to scrutinise the voting
process on behalf of the MDC, had been arrested the day before elections and
released when voting was over.

And if that doesn't work, positive persuasion may do the trick.

"It all says one thing," said Mukonoweshuro. "Zanu-PF is totally unwilling
to abide by any democratic principles. This is the political culture in
which it intends to continue its rule." - Sapa-DPA

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OnBusiness.ie

African Gold production barely covers local costs
      August 29, 2003
(16:07)
John Teeling, chairman of FTSE AIM listed exploration company African Gold
today said that the firm's gold production is barely covering the local
costs in its Zimbabwe operations.

At the company AGM today Teeling said, 'The economic environment continues
to decline with shortages of virtually everything, including cash to pay
wages.'

This month the company reported a loss of £121,000 for the year to March 31
and says the value of its assets has fallen because of the collapse of the
Zimbabwean dollar against sterling. At the time Teeling said the company was
persisting in Zimbabwe because it had gold, an educated workforce,
reasonable infrastructure and great potential.



African Gold's facility near Kadoma in central Zimbabwe is operating at
about 10% of capacity and has been hit by power breakdowns and 'a little'
civil unrest.

Today he added, 'We maintain our belief in the potential of the country and
have applied for a number of gold exploration licences.'

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FinGaz

      Hope of quick end to sanctions dampened

      Staff Reporter
      8/29/2003 10:05:31 AM (GMT +2)

      THE supreme decision-making body of the Southern African Trade Union
Coordinating Council has dampened the little support Zimbabwe got recently
by reiterating that Harare should restore the rule of law and revive the
ailing economy.

      In a statement issued at the end of the council meeting held in Harare
on Monday, SATUCC was unkind with the Zimbabwean government for violating
human rights.

      "The executive council reaffirmed its resolution on Zimbabwe, calling
for the government to respect human rights and trade union rights.

      "In particular, the council called on Zimbabwe government to adhere to
the fundamental rights outlined in the social charter, to which Zimbabwe is
a signatory," read part of the statement.

      The statement by the regional trade union body comes at a time when
several heads of African states had called on the lifting of restrictions
imposed on President Mugabe and other members of his government. The calls
were made at a regional summit, which ended in Tanzania this week on Monday.

      "The fundamental rights being referred to are freedom of association
and the right to collective bargaining," SATUCC said in reference to the
violation of trade unions' rights.

      In June this year, the International Labour Oragnisation blacklisted
Zimbabwe for violating and suppressing workers' rights among other things.

      The militant Congress of South African Trade Unions is also putting
pressure on President Thabo Mbeki to help resolve the socio-economic crisis
in Zimbabwe.

      SATUCC also endorsed the objectives of the New Partnership for Africa
Development (NEPAD) being spearheaded by Mbeki and Nigerian president,
Olusegun Obasanjo.

      Zimbabwe, which is concerned that NEPAD could be used by the West to
gain control of the continent, is still to endorse the initiative.
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FinGaz

      Church leaders to meet on inter-party dialogue

      Staff Reporter
      8/29/2003 10:01:58 AM (GMT +2)

      CHURCH leaders trying to kick-start dialogue between the ruling ZANU
PF and the opposition Movement for Democratic Change (MDC) to end the
economic and political crisis in Zimbabwe say they will meet next week to
review their position following ZANU PF's rejection of the mediation role
they are offering.

      Trevor Manhanga, the spokesman of the church groups that have been
trying to bring the warring political parties together, said yesterday they
were going to meet next week to decide the way forward.

      "I was away last week and I don't know what my colleagues who have
been meeting the parties discussed but we will be meeting next week to
discuss on what position to take," Manhanga said.

      He said he could not comment on the position taken by ZANU PF that the
churches had no mandate to start dialogue between Zimbabwe's two main
political parties.

      "We will most likely issue a statement on our position after the
meeting next week," Manhanga said.

      After weeks of trying in vain to get ZANU PF to agree to come to the
negotiating table, ZANU PF secretary for legal affairs Patrick Chinamasa,
last week said there was no role for the church leaders to play in the talks
as his party wanted direct talks with the opposition.

      "I talk to Welshman (Ncube), Gibson (Sibanda) and all other MDC
members in parliament everyday, so why would someone then come to us and say
sit down and talk?' Chinamasa said. "We will talk when the time is right but
the talks have to be direct. We are ready to talk to any Zimbabwean who has
this country at heart."

      The Zimbabwe Council of Churches, the Evangelical Fellowship of
Zimbabwe and the Zimbabwe Catholic Bishops' Conference were spearheading the
talks. They met both President Robert Mugabe and opposition leader Morgan
Tsvangirai separately as they tried to break the political impasse gripping
the country.
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FinGaz

      ‘Unelected’ groups must be included in the talks

      8/29/2003 9:26:43 AM (GMT +2)

      In this part, the fourth in a five-part series, Harare-based legal
practitioner Isaya Muriwo Sithole, reinforces the centrality of
constitutional review in an effort to normalise Zimbabwean politics and it
also argues out a case for the involvement of the so-called "unelected"
groups in the talks, if and when they resume.

      There are various conceptual issues that arise from my last
contribution in this series.

      Some Zimbabweans think that the crisis in Zimbabwe is largely a
political dispute between the government and the opposition and that these
two parties are sufficient to resolve the crisis.

      After all, it is representatives of ZANU PF and MDC that constitute
parliament, so why involve "unelected" groupings in the resolution of the
crisis; whose "mandate" do these interest groups have and whose interest do
they represent?

      The protagonists of this sort of thinking are also invariably the
advocates of the idea that the progressive movement must concentrate on
political or regime change and then address the constitutional question
afterwards.

      This group of people also argues that ZANU PF and the government, like
a leopard, will not change their spots and so it is futile to insist on the
democratisation of the constitution with the ZANU PF government still in
power; otherwise chances are that we will have a replica of what happened
during the years 1999-2000.

      A significant number of people under this category is also anti-talks.

      I understand where the advocates of this school of thought are coming
from and I respect the sincerity of their convictions, but I do not share
the underlying pessimism in the govern-ment’s will and ability to change,
especially with the new heights the crisis is assuming. The view that the
President is irredeemable (won’t change) is too deterministic and
pessimistic an idea which is often advanced by the more sanguinary among us,
wittingly or unwittingly. Like all of us, the President will push his agenda
relative to options available to him at a given point in time. He is not as
blind an actor and will know when his options have narrowed. And they have
rapidly narrowed since his controversial re-election.

      But I can’t help admitting that this is a minority view, judging by
what one reads in the media.

      In my last contribution I accused the two major political parties of
trying to assume a monopoly over what should be national dialogue, to the
exclusion of other interest groups. I was attending my uncle’s funeral in
Glen Norah over the weekend and somebody recognised me and was very keen to
know how "unelected" groupings fit into the puzzle of the resolution of the
political stalemate in Zimbabwe. This question is not very easy to answer
without tracing the history of this country from round-about 1997.

      The involvement of civil society in Zimbabwe’s politics must be put in
perspective if we are to understand the dynamics that are currently at play.

      Up until 1997 Zimbabwe did not have a vibrant and discerning civil
society, neither did it have a credible opposition party worth talking
about.

      The under-developed socio-economic structure undermined the emergence
of social forces capable of exerting a counteracting effect on the
totalitarian tendencies of the post-colonial governing elite.

      When there was a sudden upsurge of labour and student riots in 1997-98
the corridors of power were shaken and the heavy-handedness with which the
security forces dealt with these revolts raised serious constitutional
questions particularly in relation to the powers of the President, the Bill
of Rights, the electoral process among other issues.

      Disconnected calls for constitutional reform could be heard from
various quarters of civil society and this resulted in the formation of the
National Constitutional Assembly in 1997.

      The major objective behind the formation of the NCA, which is a loose
coalition of opposition political parties, civic organisations including
labour and student movements, church groups, youths, lawyers, progressive
intellectuals and academics, was for it to act as a common action front to
lobby the government to embark on democra-tisation of the constitution.

      In January 1998 there were a series of "food riots" and widespread
looting and destruction of property resulting in the President declaring a
state of emergency in terms of the Presidential Powers (Temporary Measures)
Act, and the demonstrations were ruled illegal.

      This is when the demand for constitutional review began in earnest.

      There was widespread perception that since its inception in 1987, the
Executive Presidency System has concentrated far too much unaccountable
power in one person’s hands and this power has been badly abused to the
detriment of the people of Zimbabwe.

      The government refused to engage the NCA in meaningful discussions
over constitution making.

      The NCA was advocating that an all-stakeholders conference be convened
to agree on the process and the legal framework for the process.

      Government knew that such an approach would undermine their intended
dominance of the process.

      After realising the political consequences and the difficulty – if not
the impossibility of ignoring calls for constitutional review, the
government sought to highjack the whole process and as we all know, they
preferred to proceed by way of a commission appointed by the President,
while a defiant NCA, under Tsvangirai’s chairmanship, embarked on a parallel
process whose major aim was to act as a gauge to the findings of the
government-appointed constitutional commission.

      The government’s main argument was that the NCA being an "unelected"
body of persons, neither had the "legitimacy" nor the "mandate" to "dictate"
a process for constitutional reform.

      The arrogance of the government was startling and the various civic
groups that constituted the NCA began consultations about the need and
possibility of forming a vibrant opposition political party to challenge
ZANU PF in the 2000 general elections.

      Thus was born the MDC, starting as a broad "movement" of various civic
groups and individuals pushing for "democratic change."

      It is in this broad movement that serious consultations about the need
to form a vibrant opposition party were made, resulting in the launch of the
MDC as a political party in September 1999.

      To date, the MDC remains a member of the NCA.

      The government responded by lumping the MDC, NCA ZCTU and ZINASU
together as enemies of the government.

      In view of the controversies surrounding the process of constitution
making presided over by the Constitutional Commission, the referendum became
a critical event in the constitutional reform dichotomy.

      On one hand, for the constitutional commission, the referendum was an
exercise in legitimacy.

      For a body that had been roundly condemned as partisan and seeking to
rubber stamp the views of the government the referendum was an opportunity
to say its crisis: "The people have spoken".

      On the other hand, for the NCA, the referendum had serious political
implications.

      If the people were to endorse the draft constitution, the NCA’s
theoretical premises would have been badly bruised for the obvious question
would have been: "If the people have endorsed this constitution, who are you
to say it is defective?"

      The triumph of the "NO" vote was a triumph for the so-called
"unelected" interest groups.

      The "NO" vote proved that the government’s criticism of the NCA was
misguided.

      By virtue of the diversity of its membership, the NCA represented the
view of a significant number of ordinary Zimbabweans.

      Constitution-making is about setting out governance structures and one
need not be elected to articulate a view about the way an issue of public
interest should be addressed.

      So if the readers are persuaded that comprehensive constitutional
review should be integral to the talks then it goes without saying that
"unele-cted" groupings of civil society and other minority interests should
also be accommodated.

      These talks have a crucial bearing on the future of Zimbabwe and it
must follow from their very nature that if ordinary citizens organise
themselves in some form and agitate for constitutional reform to top the
agenda so as for them to participate, it is not sufficient to raise their
unelected nature as a basis for rejecting their views.

      What should matter, in principle, is that the views of any person on
matters of constitution-making ought to be respected.

      Although constitution- making can easily be dominated by the
government of the day, as was the case in Uganda, Ghana and Zambia, to
mention just but a few, there is also evidence of transitional processes
where a broad involvement of key players including civil society has worked,
as was the case in South Africa, Namibia, and Malawi.

      The Malawian experience demonstrates that where there is a national
consensus, it matters not that groups articulating a view have not been
elected.

      The Zambian experience under Chiluba is most extreme in terms of
dominance.

      The MDC is modelled along the lines of Zambia’s MMD under Chiluba and
those who argue that political change should precede constitutional change
must be reminded of the Zambian experience.

      Amid the euphoria of the collapse of the Kaunda regime, the Chiluba
government appointed a commission to review the constitution. Most members
of the commission were directly appointed by the President while others were
appointed by him on the recommendation of some organisations. When the
commission submitted its draft, a number of its key recommendations were
rejected by the government which substantially amended the draft, rejected
calls for a referendum and had the constitution promulgated by a
government-dominated National Assembly. There is no guarantee that the MDC
will be different from the MMD of Zambia.

      The point is that right now Zimbabwe has got an incompetent government
which is difficult to remove inspite of the fact that we can see that this
government has no capacity to take us out of the current crisis. The
difficulty lies in that the government has put in place a legal framework,
in the form of a constitution, which makes it difficult to remove it. In my
view, the first step towards resolving this difficulty is changing the legal
framework and create a level playing field for all the political players in
the country and this is why civil society and minority interests are
insisting on constitutional change because we don’t want the new government
to get protection from the same oppressive constitutional order. Civil
society does not seek political power. Instead, it seeks to limit it.

      If these groups have always been involved in the democratic struggles
of this country, what is the rationale of excluding them now from the talks
that are a culmination of these struggles, and which talks are meant to
usher into the long awaited for democratic dispensation. These talks are not
just about power-sharing between ZANU PF and MDC but about restoring
legality, legitimacy and constitutionalism. This can only be achieved by the
broad participation of the generality of Zimbabweans and as such a
negotiation process that allows for such participation is a prerequisite for
the restoration of these values.

      From the history outlined above, even the MDC itself can not afford to
brush aside the issue of constitutional change, neither can it afford to
marginalise the so-called "unelected" groupings. The MDC is a "civil society
party’ whose genesis lie in the constitutional reform movement and the
sooner they realise this the better.

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      Malaysians keen to help Zim tap into new energy sources

      Staff Reporter
      8/29/2003 9:55:06 AM (GMT +2)

      MALAYSIAN investors are keen to assist Zimbabwe tap into new energy
sources to lower the heavy costs incurred in importing petroleum products, a
local banker has said.

      "I can confirm that while in Malaysia last week, discussions were held
with interested parties from that part of the world and the Middle East, who
share that vision of long-term sustainability of the energy sector," said
the Jewel Bank managing director Gideon Gono.

      The Jewel Bank boss could not disclose issues discussed with the
potential investors in Malaysia.

      Zimbabwe has a huge resource of coal bed methane gas in the Hwange,
Lupane and Gwayi area that can be converted into engine fuels, electricity
and fertilisers.

      Investment in appropriate technology and the development of a
synthetic fuel industry would reduce the country's heavy dependence on
imports that have sucked the scare foreign exchange.

      Gono said the energy sector was undoubtedly one of Zimbabwe's weakest
industries that require massive fresh investments to develop.

      "Critics would argue that we require huge capital outlays to exploit
these resources. That is a fact. We need huge investments, but there will be
light at the end of the tunnel.

      "We only need to start now and enjoy the benefits, which will come 10
to 15 years later.

      "Academics say it is part of wisdom to subordinate present comfort for
the future. Let us get together and do something that will benefit
posterity.

      "The magnitude of the challenge and the resources should not frighten
us into submission or shrink our determination to see it through," said
Gono.

      He said most of the developed countries such as the United States ,
Malaysia, the United Kingdom and Japan are successful because they invested
in their future.

      "Their citizens are enjoying the fruits of the vision of their
forefathers. Today, we are independent because some people made it their
business to free this country.

      "We have an obligation as Zimbabweans today, especially for some of us
in positions of influence to ensure we live a legacy of stability and
enjoyment to posterity," he said.

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      Politburo debates Mugabe

      Brian Mangwende Chief Reporter
      8/29/2003 9:53:43 AM (GMT +2)

      THE ruling ZANU PF party's supreme decision making body, the
politburo, will within a fortnight, for the first time since independence
from Britain, tackle what has been widely considered a political hot
potato -the issue of President Robert Mugabe's succession.

      Retired Chief Air Marshal Josiah Tungamirai, a ZANU PF founder member
who belonged to the party's liberation war council, Dare reChimurenga, said
the politburo, the chief committee that makes policies and decisions, would
meet in a fortnight to tackle the power struggle in the party and discuss
the issue of Mugabe's successor.

      "We are going to discuss the succession issue either at the end of
this month or early next month," Tungamirai said. "A number of people have
expressed interest in the job, but we'll discuss that when we meet."

      The move is widely expected to light the fuse for renewed optimism
about the resumption of stalled talks between the ruling party and the
Movement for Democratic Change (MDC).

      It has been suggested but not denied that, even though there was
unanimity that a negotiated settlement to the country's crisis would provide
a much needed tonic to the battered economy, the emotive issue of President
Mugabe's succession was one of the major stumbling blocks holding back the
resumption of the talks.

      President Mugabe, at the helm of ZANU PF since the last half of the
1970's and who many believe is, despite murmurs of a distant departure date,
seeing out his last term in office, early this year threw his weight behind
debate over his succession, setting the stage for behind-the-scenes
acrimonious in-fighting among those jostling for the post. And splits over
the issue have since emerged in the ruling party as widely predicted.

      Following a deeply divisive parliamentary and later presidential
elections, there has been pressure on the two major political parties, the
MDC and ZANU PF, to bridge what is increasingly becoming a violent political
divide. It is however the in-fighting in ZANU PF that has been holding back
a move towards a deeper rapprochement with the MDC.

      Sentiments that of late have been expressed by some senior ZANU PF
officials who fear that they could be written out of the script in a new
political dispensation have also cast fresh doubts over the ruling party's
commitment to the widely supported talks.

      Tungamirai could not be drawn to give names of party members who have
expressed interest in succeeding President Mugabe.

      However those known or said to have long coveted the top post include
Joseph Msika, the vice president, Didymus Mutasa, the party's secretary for
external affairs, Dumiso Dabengwa, a politburo member, Sydney Sekeramayi,
the Minister of Defence, Emmerson Mnangagwa, the Speaker of Parliament, John
Nkomo, the Minister of Special Affairs in the President's Office and former
finance minister and politburo member, Simba Makoni.

      Zimbabwe's High Commissioner to South Africa, Simon Moyo, believed to
be the late Joshua Nkomo's close lieutanant, and the Minister of Rural
Resources and Water Development Joyce Mujuru, are also among the list of
possible contestants.

      Mujuru, the wife of ZANU PF kingmaker, retired army general Solomon
Mujuru, is the only woman since independence to act as Minister of Defence
following the death of Moven Mahachi in 2001.

      "The matter is going to be discussed whenever it is raised," Nkomo
said adding, "if there is a vacancy at the top, the process is very clear.
Nominations will come from the provinces. Everybody will be involved at all
levels. If people want to talk about it they can , but you cannot say that
can be conclusive because the process is clear when the matter is being
formally discussed.

      "In any case, what the President meant when he opened the door to the
succession debate was that you can talk about it if you want, but the
position is not yet vacant. He has not said he is stepping down so people
can talk as much as they want," Nkomo said.

      ZANU PF's spokesman Nathan Shamuyarira could not be contacted for
comment, but he has previously said the process to choose a successor would
begin in all provinces before filtering into the party's central committee
and finally the politburo.

      The Financial Gazette understands that the politburo meeting will be a
precursor to the party process of choosing a new leader. It is however
difficult to say whether a change of leadership in ZANU PF will bring with
it key policy changes or just changes on emphasis on certain issues.

      Commenting on the line-up of possible candidates for the top job, a
ruling party insider said: "Well, Sekeramayi is very strong in the party, he
doesn't have a lot of enemies. Makoni is strong nationally, but has no real
support in the party. Mutasa is respected but age may be a disadvantage. No
one really knows where Dabengwa stands. Mujuru is the only woman success
story in the party. Moyo was like to the late Joshua Nkomo what Mnangagwa is
to Mugabe. Msika is too old to continue with such demanding tasks. He may
have to play on the sidelines. Nkomo didn't even stand in the 2000
parliamentary election so he is a bit tricky."

      Mnangagwa, widely viewed as President Mugabe's confidante, has often
been touted as the President's favourite and has been tipped as Mugabe's
preferred choice for the top position. But Mnangagwa has few backers in the
politburo. In 1999, Nkomo defeated Mnangagwa for ZANU PF's national
chairmanship and the following year, ruling party Members of Parliament
voted the former spy agency chief as Speaker of Parliament after he lost the
Kwekwe seat to the Movement for Democratic Change (MDC) in the historic 2000
parliamentary election.

      Factions along ethnic and tribal lines have already emerged within
ZANU PF, with Deputy Minister of Youth Development, Gender and Employment
Creation Shuvai Mahofa accusing senior party officials of underhand
manoeuvres to discredit President Mugabe and his two lieutenants,
Vice-Presidents Simon Muzenda and Msika, in the succession debate. Muzenda
is out of the race due to ill health.

      Insiders said this week ZANU PF risked splitting down the middle if
the succession issue was not handled carefully. They said the tribal factors
had engulfed preparations for the debate, hinting at guarded positions to
save the ZANU PF-PF ZAPU unity accord that brought two rival parties
together in 1987.

      "The unity accord signed between ZANU PF and ZAPU in 1987 may be a
thing of the past if the succession issue is not handled delicately," one
insider said. "ZANU PF may shoot itself in the foot if they are not careful.
Already, cracks have emerged regarding the proposed talks with the
opposition with some for and some against the talks. But if they refuse
Mugabe's choice then we are probably going to be stuck with Mugabe for some
time to come as he would be sceptical of any other choice."

      Another ZANU PF insider said a split in the party over Mugabe's
successor would spell the demise of the party, which has ruthlessly shrugged
off stiff opposition from the MDC, whose leader Morgan Tsvangirai is facing
high treason charges for allegedly plotting to assassinate President Mugabe.
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      Mudzuri vows not to give up fight for Town House

      8/29/2003 10:06:58 AM (GMT +2)
      AS the battle for the political soul of Harare intensifies, suspended
opposition Movement for Democratic Change (MDC) executive mayor, Elias
Mudzuri, vowed not to give up the fight to run Harare, the opposition's
bedrock of support. The MDC won 44 of the 45 council wards in Harare, with
its mayoral candidate, Mudzuri, romping home with 262 000 votes to ZANU PF's
57 000 in local government elections that were only conducted after numerous
court applications by residents and members of the opposition. Mudzuri, a
former ZANU PF student activist and founder member of the Forum for
Democratic Reform (Trust) that gave birth to the opposition Forum Party then
led by the late former Chief Justice Enoch Dumbutshena, says he is ready to
do battle with Ignatius Chombo. Chombo, a ruling ZANU PF party functionary,
is the Minister of Local Government and National Housing who is believed to
have hatched a scheme to eliminate the opposition from the seat of power,
Harare.

      The Financial Gazette's News Editor, DUMISANI NDLELA, spoke to Mudzuri
about issues surrounding his suspension and the challenges of being the
first opposition Mayor for the capital.

      Excerpts:

      Question: Why did the Minister of Local Government and National
Housing, Ignatius Chombo, suspend you?

      Answer: It's political. The government wants to run Town House and I
was the stumbling block. The MDC won the capital vote democratically, but
the government wants to come back through the back door. They are being
disrespectful to the Harare electorate.

      Question: You should be guilty of some form of misconduct to have
Chombo targeting you like that?

      Answer: I am not guilty of any misconduct, but if there was any form
of misconduct, I should have been investigated first. To the electorate and
council, I am blameless, but to Minister Chombo, I am very guilty. My crime
is that I am a mayor coming from the other side of the political divide and
I have demanded change in the way council is run. Chombo wanted me to
maintain the status quo. Let us be honest about it. Over the years ZANU PF
had managed to make City of Harare its fiefdom - jobs for the boys, youth
league and women's league cadres and contracts for the party connected
businessmen. The fear - real or imagined - is that the MDC is going to
dismantle this ZANU PF edifice and on its place build an MDC fiefdom. Yes,
this is a political turf war and the old system is refusing to give way to
the new political order.

      Question: When are the investigations against you to start?

      Answer: I should have been investigated first before being suspended,
or if they felt I could prejudice investigations, force me to go on leave.
So, you have to ask my accuser about that. He seems not to be in a hurry to
start his investigations. What I have heard are false starts just to keep us
guessing and speculating on when the investigations will start. Meanwhile,
our mandate is subverted and our tenure is disturbed - the status quo is
maintained and ZANU PF is happy. Simply put, ZANU PF is trying to subvert
the MDC mandate through some dictatorship manipulation.

      Question: But there are other MDC mayors in the country and Chombo
hasn't been harsh on them, why you?

      Answer: Harare is different. Firstly, it constitutes one third of the
country's electorate. Harare is the capital and seat of government. Its
capture by the opposition has profound significance to both MDC and ZANU PF.
Historically Bulawayo belonged to PF ZAPU, while Harare was the political
Mecca of ZANU PF. Losing Harare to MDC was devastating to the old ZANU PF -
they cannot get used to the idea and reality of losing Harare. But this is
not to say there are no political skirmishes elsewhere - they are of low
intensity when compared to Harare, but look at what is happening to the
mayor of Chegutu, Dhlakama (Francis). ZANU PF is on the warpath to
undemocratically and crudely unseat him.

      Secondly, the other MDC mayors work with councils dominated by ZANU
PF. Change in those areas is not as drastic as it is in Harare because in
other areas you are a hostage mayor. In Harare the MDC has 99 percent of the
council and council can and must transform. The mayor works with his
political colleagues, they share the same vision and mission. You have a
free mayor in Harare, something not found anywhere else as yet. We were
making genuine and profound changes in council and that has unsettled Chombo
and ZANU PF.

      Thirdly, Harare is a political fiefdom for the ruling party. The
changes we were making were seen as assaults on the ZANU PF edifice, and
pressure was applied on Chombo to stop us.

      Fourthly, ZANU PF does not believe in multi-party politics. It
believes in a one-party state dictatorship and it has found it impossible to
live with an opposition party at Town House. The situation at Town House put
ZANU PF under trial in as far as their ability and capacity for political
tolerance is concerned. Zimbabweans and other political watchers world-wide
were watching how the ruling party was going to handle the Harare situation.
ZANU PF has dismally failed in this test. They are finding it impossible to
live with the popular choice of the people of Harare, and are prepared to
subvert the mandate we were given to run the affairs of Harare.

      Question: So how are you going to survive the political pressure
building around you?

      Answer: I am an agent of change. When I took up the challenge, I knew
that I was not going to be accorded the respect due to a Harare mayor. I
knew that my tenure of office was not going to be a stroll in the garden but
a struggle - a vicious struggle. I have been arrested illegally twice for
doing my work and thrown into cells for four days. Now I am suspended
without pay - in fact Chombo wants to have me kicked out of the mayoral
house and to surrender the mayoral vehicle. I must persevere and soldier on.
I cannot make a U-turn and accept dictatorship and oppression as normal
practices. It is ZANU PF that must mend and change its ways of governance,
not the MDC. The people of Harare have demanded democracy and freedom and in
the fullness of time, the people will win. I have got my tools for survival.
The machinery being used to persecute me knows they are targeting an
innocent person.

      Question: There are some who say you are a baby of ZANU PF and could
not have risen through the ranks to become the deputy chief engineer of the
city council without being one?

      Answer: I was an engineer. Engineers were few in the city council.
They had no choice but to engage me. I stopped being a member of ZANU PF in
1985 when I realised that ZANU PF was failing - we kept on going deeper and
deeper into a crisis. But this is not to say I am ashamed of having been a
very active ZANU PF cadre. I was very active in the youth wing as a student
in Botswana and Sierra Leone. I played my role in the liberation of this
country and am proud of my involvement. ZANU PF was a great liberation
movement, but as a political party in post-independent Zimbabwe, ZANU PF has
lacked vision, ideological clarity and moral leadership - it has fallen from
grace. This is why when the Forum for Democratic Reform (Trust) was launched
as a democracy advocacy pressure group in the mid 1990s, I became its
founding member. The FDR subsequently merged with the Open Forum in Bulawayo
and eventually the two groups formed the Forum Party, which was led by the
late former Chief Justice Enoch Dumbutshena. There are many people in the
MDC who are former members of the Forum Party, ZANU PF, ZUM (Zimbabwe Unity
Movement) and the UANC. We are democrats.

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FinGaz

Comment

      Indecisiveness a drag on economy

      8/29/2003 9:16:46 AM (GMT +2)

      THE resilience of the Zimbabwean economy is legendary but the once
robust economy is now caving in due to consistent and persistent battering
in the face of gross mismanagement and natural phenomena chief of which are
recurring droughts.

      But, as has been said before, sometimes-tough economic times do not
only expose weaknesses in economic policies but also bring forth the
innovativeness and resourcefulness of a people or lack thereof. Ordinary
Zimbabweans have, to their credit, by and large shown resilience in the face
of the dip into economic melt-down.

      A major drag has however been indecisiveness on the part of
government. The country’s economy, now entrenched in recession, continues to
burn while stakeholders are engaged in what seems to be endless discussions
in fire prevention. A series of crisis meetings have been held on several
occasions to find ways of reversing the economy’s flagging fortunes.

      These have so far had no appreciable effect on the sickly economy
mainly because, although Zimbabwe is strong on ideas it falls short on
action. We do not follow through on those crisis meetings, which in itself
is emblematic of everything wrong with the way we do things. We are not
strong on decision-making and seem to lack clarity as to what needs to be
done to turn around the economy.

      This indecisiveness, which stems from the fact that most decisions in
Zimbabwe are made for political expediency, has remained a touchstone of our
way of doing things.

      Nothing underscores this fact more than the government’s reluctance,
some six years ago, to bite the bullet and increase the price of fuel when
the National Oil Company of Zimbabwe, though still in the clear, was clearly
moving towards a debt trap. The lid on fuel prices was mainly due to the
fear of a possible political backlash over the likely wave of sensitive
price increases.

      Not only that, but more recently, the eleventh-hour appeal for food
aid to the United Nations Development Programme this year is also a case in
point. The government took its sweet time to approach the UN agency as if
Zimbabwe was the only country on the African continent that required food
relief.

      There is a plethora of other pertinent issues that have since been
victims of this indecisiveness. These include the long stalled sell-off of
government-owned assets whose proceeds could have been used to reduce what
has become the national ulcer — the budget deficit. Except for a few cases,
the privatisations have been left half done as the authorities ponder
whether they should completely dispose of the assets or effect
"corporatisation" — a Chinese half way house between rigid state control and
private ownership.

      Meanwhile, as the government dithers, state-owned companies continue
to pressure public finances as they depend on a life-support system provided
by the already stretched fiscus.

      There has also been indecision over the provision of critical
agricultural inputs, which will certainly compromise the productivity of the
new farmers. Holding on to the land without the inputs is like holding on to
cheques that they cannot cash! There is the real danger that Zimbabwe could
once again fail to produce enough to feed itself. And that would be a
tragedy.

      There is also the continued bickering over the long overdue and
inevitable devaluation of the over-valued Zimbabwe dollar and the
reluctance, especially on the part of ZANU PF, to take the plunge into
political dialogue to find a negotiated settlement to the country’s crisis.
The list is endless.

      It is only when it finally dawns on the government that a stitch in
time saves nine that our situation could improve for the better. Otherwise
the uncertain outlook could be with us for a painfully long time.

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      Rivalry threatens Free Trade Area

      Dumisani Ndlela News Editor
      8/29/2003 9:17:42 AM (GMT +2)

      A bitter rivalry among Common Market for East and Southern Africa
(COMESA) members created by Africa's first Free Trade Area (FTA) has claimed
its latest casualty, Namibia, which is now withdrawing its membership from
the regional bloc.

      Namibia joins Tanzania, which quit Comesa in 2000 fearing its
industries were too weak to compete under the FTA non-tariff arrangement
launched in the same year.

      A Comesa spokesman, Mweusi Karake, said Namibia had already informed
the Comesa secretariat that it would pull out of Comesa because it was not
benefiting from the three-year old FTA.

      "The whole spirit of free trade is being lost," said Danny Meyer,
president of the 77-member African, Caribbean and Pacific Chamber of
Commerce, which groups country business representative organisations.
"Weaker countries were supposed to be pulled by the stronger ones, but
that's not happening. It (Comesa) needs to go back to the drawing board and
find out what stakeholders want out of this free trade arrangement."

      Lovemore Kadenge, president of the Zimbabwe Economics Society, said
the rivalry created by the FTA posed serious dangers to the survival of
Africa's first free trade area, maintaining that frustrations experienced by
members who feel disadvantaged by the FTA might scupper it or quit Comesa
altogether.

      "It seems the free trade area has created problems rather than
promoted trade among members," said Kadenge. "Right now, the Zambians have
devised their own tax system to charge Zimbabwean products which they say
are putting their products out of their own market."

      Namibia's imports within Comesa had grown ten times more than its
exports into the grouping under the FTA regime.

      Namibia is now concentrating its efforts on the Southern African
Customs Union (SACU), another regional trade body whose members are
Swaziland, Lesotho, Botswana and South Africa.

      Problems for the FTA had always been apparent. A year after its
launch, Kenya, Malawi and Zambia expressed strong concern to the regional
trade block over the zero tariff regime, saying their weak industries were
haemorrhaging from guarantees on the free movement of goods and services
among FTA participants.

      Zambia's industrialists complained that cheap imports from
neighbouring Zimbabwe were flooding their markets, threatening their
survival, while Kenya demanded Comesa to impose quotas on duty-free sugar
imports from trading bloc partners, saying its vital sugar industry could
collapse due to cheap imports from Egypt, Malawi, South Africa, Zambia and
Zimbabwe.

      South Africa, the region's biggest economy, refused to join the
20-member Comesa in a move that analysts say was calculated at protecting
its own industries against cheap imports from neighbours under the
non-tariff FTA arrangement.

      But now the tables are turning against Zimbabwe, currently going
through its worst economic crisis in history.

      Zimbabwe's exports to Kenya, its key trading partner, plummeted by a
massive 83 percent - US$3.3 million last year, from pre-FTA levels of
US$19,5 million. Zimbabwe's imports from Kenya also dropped by 87 percent
during the same period, from a high of US$15 million to a low of US$2
million.

      Zimbabwe's exports to Zambia have also taken a tailspin, dipping by
80.4 percent to US$1.8 million in the first quarter of 2002.

      The country banned the export of wheat, maize and a variety of food
products after accusing its neighbours of depleting its food stocks through
a roaring cross-border trade and taking advantage of the FTA.

      "It's affecting relationships - long standing business relationships,"
said Meyer.

      He said Zambian cement producers, cigarette manufacturers, liquor
producers and farmers, among others, had complained about being threatened
by products from Zimbabwe. He said that despite glaring grievances between
industries, governments were not committing themselves to discussions to
solve the problems.

      Instead, some countries were introducing bureaucratic measures and
systems that in fact undermined the spirit of the FTA. For example, he said,
travellers to Zimbabwe were being forced to pay a US$15 carbon tax if they
came driving, and this had not been communicated to counter-parts in Comesa.

      "Just this week, I met a businessmen who came by road and was asked to
pay the carbon tax. He had to drive back to Zambia. They end up asking: is
it worth doing business with Zimbabwe?" Meyer said.

      Comesa, a 20-nation African trade bloc, launched its FTA on October
31, 2000 with nine of its members initially participating in the project,
which dismantled trade barriers and guaranteed free movement of goods and
services in the region.

      The objective of the FTA is to create an integrated market for trade
in goods and services and to increase the Comesa region's competitive
advantage as a production base geared for the world market.

      An integrated and enlarged market would attract investments much more
effectively than the much smaller national domestic markets and this was
envisaged to stimulate growth and raise, for Comesa member countries, the
stakes in one another's purchasing power and economic progress.

      Comesa members are Angola, Burundi, Comoros, Democratic Republic of
Congo, Djibouti, Egypt, Ethiopia, Kenya, Madagascar, Malawi, Mauritius,
Namibia, Rwanda, Seychelles, Sudan, Swaziland, Uganda and Zimbabwe.

      Current FTA members are Djibouti, Egypt, Kenya, Madagascar, Malawi,
Mauritius, Sudan, Zambia and Zimbabwe. The withdrawal of Namibia is
certainly going to inflict serious danger to the Comesa region, whose
combined Gross Domestic Product stands at not more than US$160 billion and
three quarters of its 400 million citizens survive below the World Bank
poverty threshold of a US-dollar a day.

      While Egypt, a strong advocate of a continent-wide free trade zone,
joined the Comesa FTA a year after its launch, Burundi and Rwanda have
undertaken to join the FTA on January 1 2004. Swaziland, a strong member of
the SACU where Namibia has declared it will begin lavishing all its
affection, will seek the concurrence of SACU to join the Comesa FTA in April
2004.

      But following Namibia's decision, and Tanzania's earlier misgivings,
and the battles raging among members already in the FTA, Burundi, Rwanda and
Swaziland's moves are likely to be accompanied by hesitancy.

      Uganda and Comoros are likely to remain watchers of the trade theatre
created by the FTA before they can make a decision.

      But Comesa remains defiant: it is still pushing ahead with plans to
create a Common External Tariff and Customs Union by December 8 2004, and to
adopt a common currency for regional members by 2025.

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FinGaz

      Stop side-marketing, cotton farmers told

      Zhean Gwaze
      8/29/2003 10:20:16 AM (GMT +2)

      THE cotton industry, which earned US$150 million in foreign exchange
receipts last year, could collapse if regulations are not put in place to
safeguard major players’ interests.

      Cotton growers with no access to commercial seasonal finance were
dealt a major blow when the Cotton Company of Zimbabwe (Cottco) and FSI
Agricom put on ice their input credit schemes that had been their mainstay.

      Cottco and FSI were not happy with the side marketing by new players
looking for better prices.

      For example, a number of new farmers have established agencies that
handle their exports, sidelining traditional processors who have invested
billions of dollars in input credit support.

      Major players in the industry warned that the quality of lint would be
compromised if a regulatory framework is not put in place within the next
two months.

      This would put a damper on the good international reputation gained by
local cotton producers over the years.

      Sources said told The Financial Gazette this week the industry
submitted proposals to government last year to ensure players in the sector
earn profit through greater investment.

      The government is still to respond to the proposals.

      "The regulations are meant to safeguard the long-term interests of the
industry and the government should make a move so sanity is restored in the
industry within the next two months in which the cotton growing season
begins," an official in the industry said.

      No immediate comment could be obtained from Trade and International
Development Minister Samuel Mumbeng-egwi on the issue.

      Farmers’ representative organisations said the timing by Cottco and
FSI Agricom was unfortunate because cotton was one of the few crops that had
done well.

      "Government should come in and regulate the sector quickly because not
all farmers have been breaching the contracts.

      The farmers have to be protected because this is a war among the
cotton companies," said Indigenous Commercial Farmers Union president
Davison Mugabe.

      Economic consultant John Robertson said the developments in the cotton
industry are a message to the farming community that contractual obligations
need to be adhered to.

      Robertson said: "The action by the companies was obvious because side
marketing is a serious breach of contract. It gives the new farmers a bad
reputation."

      Cotton is the country’s second largest agricultural export after
tobacco, contributing US$150 million in gross earnings last season.

      Zimbabwe exports at least 70 percent of its annual cotton lint
production.

      Farmers were this year focusing on taking productivity levels beyond
the 500 000 tonnes per year without compromising the quality of lint.

      Cargill told The Financial Gazette that they would continue financing
the crop, but hoped that the regulations would be put in place soon.
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FinGaz

Late disbursement of funds threatens tobacco output

Staff Reporter
8/29/2003 10:21:03 AM (GMT +2)

ZIMBABWE could lose 45 percent of the tobacco crop this year due to the late
disbursement of funds meant for the preparation of seedbeds, it emerged this
week.

An official with the Indigenous Commercial Farmers Union (ICFU) told The
Financial Gazette this week that the Zimbabwe Tobacco Industry and Marketing
Board (TIMB) only started disbursing the $1 billion loan facility this month
instead of April.

"As a result of the delay, we (farmers) have lost the crop under irrigation,
which constitute 45 percent of the crop.

"The whole idea to the farming game is good timing," the ICFU official said.

Tobacco is the country’s largest foreign currency earner.

TIMB chief executive Stanley Mutepfa could not be reached for comment as he
was said to be out of office. Tobacco sales are expected between 80 and 85
million kg this year, a 50 percent decline from the crop sold the previous
year.

Analysts attributed the decline in output to the drought and the government’
s chaotic land reform, under which scores of large-scale tobacco farmers
were evicted from their farms.

Serious shortages of inputs also led to late planting.

This year’s crop output is projected to fall further as small-scale farmers
bay for the devaluation of the Zimbabwe dollar from the current Z$824 to the
greenback.

The devaluation would lead to an increase in prices of all inputs, which
will become another major setback to the farmers.

"What we need is a support rate that ensures that players in the industry
are awarded excellently as they play a major role in bringing foreign
currency to the country," said the official.
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FinGaz

      People disposing property losing 50% of true value : report

      Staff Reporter
      8/29/2003 9:51:48 AM (GMT +2)

      MOST people disposing of their residential properties are losing up to
50 percent of their true value because of poor advice and badly worded
agreements of sale, a local real estate agency said.

      In its report, Seef Zimbabwe said confusion now dominates the active
property market, worsened by the high maintenance and building costs.

      "Security, condition and proximity to amenities have become
increasingly important, but the effect on different properties in different
areas and how it affects the price does not really need the advice of an
expert.

      "Bad advice from amateurs can and has cost Zimbabweans millions of
dollars over the last few years," said the report.

      There are no bargains on the market at the moment as there are no
willing sellers in the deteriorating socio-economic environment, a situation
that has resulted in escalating property prices.

      A huge appetite for property still exists among Zimbabwe’s growing
expatriate population, which is mainly in the United Kingdom and the United
States of America.

      The report said: "They will find that an investment in the right
property, in the right area, will double in value in real terms when
stability is achieved. Some buyers, however may find their investment
deteriorating in real value terms if security or maintenance is bad or
promised service of delivery does not materialize for years."

      Interest rates are a fraction of inflation, which means owners of
properties and other corporeal assets will not sell unless they have to.

      The report said that shortages would increase as inflation continues
on an upward spiral, although ironically the value of these properties may
drop in real terms.

      Owing to the increasing neglect and the on-going economic decline, a
large proportion of the value of the country’s national housing stock in all
areas is said to be dropping in real terms.

      The report added that the prices of some residential properties in the
country were already higher than those in neighbouring South Africa because
of astronomical local building costs the shortage of secure and well
appointed and maintained homes in certain sought after areas.
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FinGaz

      Strike costs NRZ $400 mln

      Staff Reporter
      8/29/2003 9:57:01 AM (GMT +2)

      BULAWAYO - THE cash-strapped National Railways of Zimbabwe (NRZ) has
lost about $435 million in the past three days as a result of disruptions
caused by the on-going industrial action, The Financial Gazette can reveal.

      Information at hand shows that the tottering parastatal reported
recently to be in urgent need of $7 billion and US$50 000 in foreign
currency to re-capitalise, has been loosing $145 million per day because of
the strike that kicked-off on Monday this week.

      The 10 000-strong NRZ workers are demanding a 490 percent salary
increase, while management is understood to be only willing to award the
employees a 75 percent hike. It also emerged this week that the three
railways workers unions - the Zimbabwe Amalgamated Railway Union, the
Railway Association of Engineman (RAE) and the Railway Artisan Union (RAU) -
had been negotiating with management for the past few weeks.

      Insiders told this newspaper that the salary negotiations had reached
an impasse, forcing management to refer the matter to the Ministry of Public
Service, Labour and Social Welfare.

      Yesterday morning, the workers representatives held a closed-door
meeting to prepare for an alleged showdown with July Moyo, the Minister of
Labour.

      "We (workers representatives) are on our way to Harare as we have been
summoned to meet the Minister of Labour since the employer has applied for a
show cause order," said Fabion Chenyika, the president of the Railways
Artisan Union.

      "There has not been any head way between us and the employer over the
salary dispute. Now the minister has to resolve the issue. We want over 400
percent salary increment, but we are still willing to negotiate," said
Chenyika, as he emerged from a meeting with other railway unions'
representatives.

      Thousands of commuter and travelers were left stranded since Monday as
the NRZ workers downed tools countrywide forcing the parastatal to cancel
passenger services.

      The NRZ announced on Tuesday evening it had put in place contingent
measures to be run by skeletal staff to transport essential commodities such
as Ferro-chrome, coal and maize.

      Misheck Matanhire, the NRZ spokesman said yesterday demands for a
whopping 490 percent salary increase translated to total payroll costs of
$17,1 billion per month, against projected monthly revenue of $45 million.

      "It is worthy noting that the NRZ awarded a salary increase of 82
percent in January 2003 to all employees and also awarded another cost of
living adjustment of 25 percent of basic pay in July 2003 as well as other
allowances such as transport," said Matanhire.

      Workers representatives were adamant yesterday that the industrial
action would continue indefinitely if the minister fails to meet their
demands.
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SABC

Relations between Botswana and Zimbabwe hit new low
August 29, 2003, 12:56 PM

The diplomatic row between Botswana and Zimbabwe is set to hit a new low.
This follows a move by the Botswana government to erect a four metre high
electric fence along its north-eastern border line with Zimbabwe. Botswana
took a decision to erect the electric fence shortly after the outbreak of
foot and mouth disease in that area earlier this year.

The outbreak of the disease created major problems in landlocked Botswana.
During that period, thousands of cattle had to be put down to prevent
further spread of the disease. The outbreak of the highly contagious deadly
viral infection dealt a blow to Botswana's lucrative beef industry - the
country's second foreign exchange earner after diamonds. It is for this
reason that Botswana decided to erect an electric fence along the
north-eastern border line with Zimbabwe that stretches for about 640km.

This move has, however, soured relations between the two countries'
authorities - more especially Phelekezela Mphoko, the Zimbabwean high
commissioner to Botswana, who has branded it as provocative.

Botswana which is also faced with the massive influx of illegal immigrants
from its northern neighbour, has defended the move as a security measure
aimed at preventing any possible illegal movements of animals and immigrants
within its territory. Without going into details about the immigration
crisis facing his country, Mompati Merafhe, the Botswana Foreign Minister,
has admitted that it was a problem.

Diplomatic ties between the two countries again took a nose dive earlier
this month, when it was reported in the media that Botswana was hosting US
and British officials. The officials were allegedly plotting to overthrow
Robert Mugabe, the Zimbabwean President, by using the Botswana Airforce Base
as a launch pad. This was however denied by Merafhe.

Botswana is already under pressure from its citizens to address the massive
inflow of illegal Zimbabwean immigrants. The development is said to have
depleted its financial resources that are committed toward monthly
repatriation exercises.

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