ZANU-PF snubs Mbeki

FinGaz

Njabulo Ncube Political Editor
SA leader’s bid to resume talks forestalled
THERE was a fresh setback in the talks between ZANU-PF and the opposition
this week after the ruling party declined an invitation by South African
President Thabo Mbeki to a meeting to break a deadlock over demands by the
Movement for Democratic Change (MDC) for a transitional constitution and a
postponement of the polls scheduled for March.

President Robert Mugabe, who will fight in ZANU-PF’s corner as the party’s
presidential candidate, insists elections will be held under the current
constitution and will not be deferred beyond March, a position that the MDC
sees as unacceptable.
Mbeki, who, unlike his Zimbabwean counterpart, has a political future
balancing on the knife-edge after losing the African National Congress
presidency to his rival, Jacob Zuma, had called a meeting after the two
opposition representatives, Tendai Biti and Welshman Ncube, informed him of
an impasse over the constitution and the election timetable.
In an official complaint to Mbeki, the MDC accuses ZANU-PF of backtracking
on an agreement to implement a transitional constitution, and once again
pleads for a postponement of elections from March to a later date to allow
the implementation of all other outstanding matters in the agreement.
Sources privy to the negotiations told The Financial Gazette that Mbeki,
through his negotiating team headed by his local government minister Sydney
Mufamadi, had invited ZANU-PF and MDC negotiators for a meeting in Pretoria
tomorrow.
However, ZANU-PF said it would not agree to attend until President Mugabe
returns from his annual leave, giving another glimpse into the veteran
politician’s unyielding grip on the affairs of his party.
The President is currently on holiday in the Far East.
The Zimbabwean leader, who turns 84 next month, has been the heart and soul
of the ruling party, which he has shepherded since independence in 1980.
MDC and ZANU-PF would have travelled to Pretoria today for the meeting.
“The idea is to prolong the talks until after the elections, rendering the
whole process useless” said a source. “Another thing is that ZANU-PF does
not want Mbeki to officially declare a deadlock to SADC (the Southern
African Development Community), as it is clear ZANU-PF is backtracking and
not following the spirit of the SADC talks.”
Neither side was prepared to comment on the latest snag to hit the talks,
citing a secrecy clause signed in Pretoria.
But a ZANU-PF official said: “They have themselves (MDC) to blame. We are
only worried about elections. Why should we be going to Pretoria when we
have an election in front of us?”
Mbeki, who is seeing out his last term after unsuccessful attempts to push
for a third term, had intended to use the Pretoria meeting to iron out
differences between the two sides and pave the way for the staging of
elections with an outcome that SADC says should be accepted by all parties.
As reported by The Financial Gazette last week, the main sticking points are
a transitional constitution and an election date.
The MDC, which was weakened by the October 2005 split, says it settled for
the transitional constitution following assurances that the agreement would
be implemented prior to the elections. It proposed that each side would
second two officials to a committee to oversee the transitional charter. The
parties would agree on a fifth member.
But the opposition says ZANU-PF is now against that deal, insisting instead
on a new constitution after the election, which the MDC says is
unacceptable.
The opposition says the pace at which the transitional constitution was to
be implemented was supposed to determine the election date, adding that the
transitional constitution already agreed on was essential in that it helped
in the setting up of infrastructure for a sound electoral management system,
codes for good governance, and a human rights regimen between now and the
election date.
Some of the critical issues the opposition wants implemented before the
elections include allowing Zimbabweans in the Diaspora to vote, the counting
of votes and announcement of results at polling stations as well as agreeing
on the role of SADC and other international observers in the elections.
The government insists it will only allow “friendly” countries and
organisations to observe the elections.

Primaries to expose growing rift in ruling party

FinGaz

Staff Reporter

ZANU-PF primary elections set for next month will further expose the
widening fissures within the fractious ruling party and add fuel to
speculation over the emergence of a breakaway group.

Primaries are likely to be called in the first week of February after
President Robert Mugabe dissolves Parliament.
Analysts predict the elections could be held on March 29, as President
Mugabe will resist pressure to postpone them.
But as campaigning within ZANU-PF heats up, especially for candidacies in
the party’s “safe” rural strongholds, latent divisions over the Zimbabwean
leaders’ incumbency will come to the fore.
“It is as if the delimitation report is already out,” said a ZANU-PF insider
yesterday. “People seem to know in which areas new constituencies have been
created, especially in Masvingo.”
Sitting legislators are working overtime to fend off rivals intending to
wrest power from them by plying traditional leaders with gifts ranging from
cash to livestock to persuade them to rally local support for the
incumbents.
An extra 90 seats have been created in the lower House of Assembly, while
the senate will have an additional 43 seats, triggering a stampede by
aspiring legislators who, sources said, are campaigning along ZANU-PF
factional lines.
Emmerson Mnangagwa, the Minister of Rural Housing and Social Amenities, has
reportedly sparked controversy in the Midlands and Masvingo provinces, where
he is said to be seeking a new political home after faring badly in Kwekwe
in two previous parliamentary elections.
Mnangagwa lost in 2000 and 2005 to little known opposition Movement for
Democratic Change (MDC) candidate Blessing Chebundo, and is said to be now
looking for accommodation either in Mberengwa or Masvingo.
He is currently a non-constituency Member of Parliament (MP), but with
President Mugabe’s powers to appoint loyalists to Parliament now severely
curtailed, Mnangagwa is desperate to secure a seat on his own.
Many more ZANU-PF stalwarts that have been rejected in urban areas are to
fight primaries in their rural homes. In Manicaland, Irene Zindi, a member
of the commission running Mutare, plans to challenge Oppah Muchinguri, Women’s
Affairs Minister and ZANU-PF women’s league boss, in Mutare South.
But the bitter fallout over President Mugabe’s succession is likely to play
out more publicly in Matabeleland, where supporters of war veteran Jabulani
Sibanda are determined to replace the old guard, whom they have publicly
accused of “hiding behind the Unity Accord” to cling to power.
It is said senior ZANU-PF figures in Matabeleland are among the strongest
proponents of a new movement, which according to speculation could emerge to
end President Mugabe’s continued hold on power.
But war veterans, fiercely loyal to the President, want the senior officials
to play no further part in ZANU-PF, charging they allowed the MDC to gain a
foothold in the region.
John Nkomo, the ZANU-PF national chairman, Sithembiso Nyoni, the Small and
Medium Enterprises Minister and Information Minister Sikhanyiso Ndlovu would
have to hunt for “safe” constituencies to curtail their dependency on
President Mugabe’s leniency.
Other non-constituency MPs such as Justice Minister Patrick Chinamasa, Water
Resources Minister, Munacho Mutezo, Indigenisation Minister, Paul Mangwana
and Mines Minister Amos Midzi are also under pressure to wean themselves
from the ageing Zimbabwean leader who has single-handedly guaranteed their
continued stay in government.
In Masvingo North, Stan Mudenge, the Minister of Higher and Tertiary
Education, is said to be now sleeping easier after the suspension of Kudzai
Mbudzi, who had shown a desire to challenge him in the polls.
Mbudzi, who publicly opposed last year’s controversial solidarity marches
for President Mugabe, has been linked to senior figures within the ruling
party and in business reportedly seeking to forge a broad coalition that
would include the opposition.
In Bikita, Claudius Makova is understood to be facing a threat from Elias
Musakwa, a Reserve Bank of Zimbabwe employee and gospel singer.
But an unwritten requirement that parliamentary and senatorial hopefuls
should have been provisional members of ZANU-PF for the past five years and
over 46 years of age is said to have thwarted the aspirations of many Young
Turks, among them Henrietta Rushwaya, the acting chief executive of the
Zimbabwe Football Association who had shown an interest in standing in
Masvingo province.

Companies fail to re-open

FinGaz

Kumbirai Mafunda Senior Business Reporter

A NUMBER of companies might fail to re-open after the traditional annual
shutdown ending this week in the first clear sign yet of the irreparable
damage inflicted on industry by an economic crisis entering its ninth year.

Industry sources revealed this week that several companies would remain shut
while some of those that had planned to resume operations next week
postponed opening their doors until after the joint March elections when
they hope to have sourced enough foreign currency to resume production.
They said most companies had shelved reopening because of the crippling raw
material shortages caused by the huge supply deficit of foreign currency.
Zimbabwe has struggled to shore up its foreign currency reserves after the
International Monetary Fund pulled the plug on the troubled state in the
late 1990s.
Donors and foreign investors, unnerved by government’s populist economic
policies quickly rushed for the exits, leaving the country grappling with a
precarious foreign currency situation.
The July 2007 price blitz, which central bank governor Gideon Gono last week
referred to as “the darkest period in the history of Zimbabwe,” arobbed
industry of the little hope for recovery.
“The current blitz on the parallel market and the spying on companies has
scared and forced most firms to postpone resumption of operations.
“Furthermore, the economic conditions are running counter to normal business
practice,” said a source.
Industry executives said some manufacturers had seen it feasible to keep
their firms shut because of unviable prices dictated by the National Incomes
and Pricing Commission (NIPC) and the costly and intermittent power outages.
Confederation of Zimbabwe Industries chief executive officer Joseph Malaba
yesterday said the apex industrial lobby group was still assessing the
impact of the economic crisis.
“Information of that nurture (failure to reopen) has not reached us. We are
conducting our members to find out what challenges they are facing. It’s a
bit early to comment,” Malaba said.
Government has previously threatened taking over companies viewed as
“sabotaging” the economy. It is feared that prolonged company closures might
put the companies’ shareholders on collision course with President Robert
Mugabe’s government.
The NIPC has since last year been dictating prices to manufacturers and
retailers. But executives protest that the fixed prices are uneconomic and a
threat to their survival.
A Financial Gazette assessment showed pessimism hanging over the economy
with no chances of recovery as a spate of price hikes and the dislocation of
key economic fundamentals pervades the country.
Economic analysts said most companies would continue shattered by the
economic crisis, which is marked by a world beating inflation estimated
above 24 000 percent despite accessing cheap production funds under the
Basic Commodities Supply Side Intervention (BACOSSI) facility.
“BACOSSI doesn’t give foreign currency to import raw materials,” said one
analyst.
Other observers said nothing is expected to change in the troubled country
where government’s ill-advised policies would continue to wreak havoc ahead
of this year’s elections.
Critics said the comatose economy will continue to be a victim of government’s
dangerous experiments with the economy, especially as the ruling ZANU-PF
wobbles into a crucial election, which it has to win at all cost.
“There is no source of optimism (on economic recovery). How does it
(optimism) come when the government is enlarging parliament and the senate
when you don’t have money,” said Godfrey Kanyenze, the director of the
Labour and Economic Development Research Institute of Zimbabwe.

ZRP needs 32 000 new recruits for poll

FinGaz

Njabulo Ncube Political Editor

THE Zimbabwe Republic Police (ZRP) needs to urgently recruit about 32 000
additional officers to adequately supervise elections in March, a
parliamentary committee says.

In a report last month on the third-quarter budget performance of the Home
Affairs Ministry, the Parliamentary Portfolio Committee on Defence and Home
Affairs said while Kembo Mohadi’s ministry was reeling under a severe
cash-crisis, it needed to boost its numbers to man the polls.
President Robert Mugabe, who has been in power since independence in 1980,
has scheduled Presidential, House of Assembly, senate and local government
elections for March.
The main faction of the opposition Movement for Democratic Change (MDC) is
demanding a postponement of the harmonised polls to June to allow for the
leveling of the skewed political playing field.
The parliamentary report shows that the current size of the ZRP, which has
been accused in the past of being partisan, is 28 000 police officers.
“In view of the forthcoming elections, there will be 15 000 polling stations
and there are supposed to be four police officers per station,” the report
says. “Therefore, the department (of Home Affairs) requires an additional 32
000 personnel to meet the demands of the forthcoming polls. This means
additional funds are needed for training.”
Under constitutional provisions agreed between ZANU-PF and the feuding MDC
factions, elections will be held in a single day, which is in line with
Southern African Development Community guidelines on the staging of
democratic elections.
The committee recommended that Treasury release funding immediately to
finance the police force’s activities in the run up to elections.
The committee, chaired by ZANU-PF Member of Parliament for Bikita West
Claudius Makova, said the Registrar General’s office, which is also partly
involved in the running of elections through its responsibility for the
voters’ roll, urgently needs at least $80 billion more after extending the
mobile registration exercise.
“Treasury is running late in releasing funding for this programme. Your
committee gathered that for the printing of the voters’ roll, only $10
billion was provided, yet the process required Z$3.5 trillion,” it said.
The Zimbabwe Electoral Commission, chaired by George Chiweshe, has just
completed the delimitation exercise that saw it carving 210 House of
Assembly constituencies, 93 senatorial boundaries and about 2000 wards for
local government elections.
The opposition has criticised the composition of the ZEC, saying it is
packed with President Mugabe’s ex-military loyalists and other ZANU-PF
sympathisers.
Justice Chiweshe is a former Zimbabwe National Army court martial judge.

Fear grips ZANU PF as fresh purge looms

FinGaz

Dumisani Ndlela Business Editor

THE imminent split in ZANU-PF, reported by The Financial Gazette last week,
has heightened tension in the ruling party and Cabinet amid fears that
President Robert Mugabe could take stern measures against those involved.

The ZANU-PF strongman is currently on holiday in Asia, and is expected back
at work before the end of this month.
Reports on the looming split, which has the backing of some senior African
National Congress officials, are said to have increased apprehension within
ruling party ranks, with sources indicating that even a Cabinet meeting
chaired by acting President Joseph Msika on Tuesday “had been subdued” due
to deepening fears that President Mugabe was likely to axe some members of
his inner cabal on his return.
One Cabinet minister called this reporter to say the newspaper had “stoked
fire for us” due to its publication of the story.
The Financial Gazette can report that the planned split has the backing of a
powerful faction within ZANU-PF, which has secured backing from a number of
former PF-ZAPU cadres even “at Cabinet level”.
Apparently, President Mugabe is said to be aware of the key players behind
the planned breakaway from the party, and had tarried taking action to fully
digest the full consequences of a purge.
But nervous government officials who are part of the plot said they had
information that President Mugabe could purge them from office once he
resumes duty after his annual holiday.
It was not immediately clear if the purge would be wholesale, or if it would
simply target a few individuals and ignore the godfathers as happened when
he punished members aligned to former ZANU-PF secretary for administration
Emmerson Mnangagwa for attempting to block Joice Mujuru’s ascendancy to the
Presidium.
Mujuru was pitted against Mnangagwa in the race for the second most powerful
position in both the party and the country.
Six provincial chairmen including Daniel Shumba who now leads the United
People’s Party and Jabulani Sibanda, whose resurgence has ruffled the
feathers of the old guard in Matabeleland, were suspended from the party
over the so-called Tsholotsho Declaration.
Sources last week indicated that the suspension of Attorney General, Sobuza
Gula Ndebele, an ex-officio member of the Cabinet, could indicate the manner
in which President Mugabe is likely to deal with the issue, a source
suggested.
Ndebele was suspended pending investigations into allegations that he
privately met former NMBZ Holdings executive, James Mushore, when he knew
the banker was on the police wanted list.
Ndebele is reportedly aligned to the powerful faction within ZANU-PF with
strong links to the military.
Reports last year indicated that the faction had scuttled President Mugabe’s
bid for endorsement at the 2006 ZANU-PF conference, at which he had sought
backing for proposals to harmonise the country’s presidential and
parliamentary elections this year, as well as make the legislature an
electoral college responsible for the appointment of a presidential
successor should the incumbent decide to retire during his term.
A Herald columnist, widely believed to be President Mugabe’s spokesman
George Charamba, last week discounted The Financial Gazette’s report on the
looming split as “an old, tired beat, much like assault, theft or murder
trials in court journalism”.
Ironically, Charamba contemptuously indicated that “the supposed launch
month for the stillborn initiative is February”, after indicating that Ibbo
Mandaza, “who was not given us as straightforwardly such” in The Financial
Gazette’s report, was the key person driving the initiative.
“He (Mandaza) and a major (Kudzai) Mbudzi have whispered loud enough to make
intelligence gatherings effortless,” Charamba said, almost revealing the
involvement of former military officers.
Mbudzi declined comment yesterday, saying he was yet to read Charamba’s
allegations.
Mandaza said: “We’ll be replying to the civil servant’s comments in good
time.”
The Financial Gazette did not name the people driving the strategy, nor
those reformists likely to defect from the party to join members of the two
factions of the Movement for Democratic Change, due to legal reasons.
But Charamba, who uses the pen name Nathaniel Manheru for his column, made
an uncharacteristic attack on Simba Makoni, a former finance minister in
President Mugabe’s Cabinet who is currently a politburo member in the party,
saying he had been touted as the possible leader of the breakaway party.
Indirectly referring to Makoni, Charamba charged: “Who was Zimbabwe’s energy
minister when the country faced its first energy crisis in the early
eighties?” How did he leave SADC, Zimpapers, government?”
This suggested a dishonest past for Makoni.
Makoni was minister of energy in President Mugabe’s first Cabinet after
independence and led the Southern African Development Community (SADC) as
its secretary general before leaving to take up an appointment as chief
executive officer of Zimpapers and later rejoining Cabinet as finance
minister.
Makoni left Zimpapers after clashing with President Mugabe’s relative, the
late Charles Chikerema, then an editor with The Sunday Mail and resigned
from Cabinet after stern opposition from other Cabinet members who alleged
his pro-free market policies were backed by the West and labelled him an
economic saboteur.
One of they key ruling party members involved in the initiative was said to
have met Morgan Tsvangirai, leader of one of the factions of the MDC, to
push the initiative forward.

Kenya chaos: Lessons on flawed election processes

FinGaz

Njabulo Ncube Political Editor

THE violence sparked by the disputed election outcome in Kenya, which left
at least 600 people dead, provides an important lesson for Zimbabwe ahead of
its own polls in March, analysts said this week.

Independent political analysts who spoke to The Financial Gazette as mayhem
continued to engulf Kenyan slums and rural areas agree that the prevailing
political environment in Zimbabwe, in which President Robert Mugabe is
viewed as a “player and referee”, could be a recipe for disaster.
With the ruling ZANU-PF and the main opposition Movement for Democratic
Change (MDC) deadlocked on pre–election conditions, it is a moot question
whether this state of affairs does not pose a threat of violence breaking
out if tensions increased and the outcome was not accepted by all parties?
“Unless we have an independent and transparent electoral commission, clearly
the elections will be rigged in favour of ZANU–PF and the incumbent,
sparking discontent,” said Lovemore Madhuku, chairman of the National
Constitutional Assembly. “What has triggered the regrettable situation in
Kenya is that there was no transparency and independence in that country’s
electoral commission.”
Kenya’s electoral commission chairman, Samuel Kivuitu, fuelled tensions when
he told the media; “I don’t know if (Mwai) Kibaki won.”
He claimed that he was under pressure from the ruling party to declare
Kibaki the winner. The only way to avoid a recurrence of the Kenya debacle
in Zimbabwe, analysts said, is to ensure a level playing field for all
parties.
Police Commissioner Augustine Chihuri was yesterday quoted on state radio
saying he hoped Zimbabweans learnt something from the Kenyan experience.
While there is debate as to whether Zimbabweans have the stomach for street
protest – previous attempts to rally such actions have failed.
Morgan Tsvangirai, leader of the main camp of the opposition MDC, has warned
that the prevailing political environment was not conducive to free polls.
The former trade unionist called on President Mugabe to stop dilly-dallying
on the implementation of crucial agreements hammered out by parties to South
African President Thabo Mbeki’s mediation process Okayed by the Southern
African Development Community (SADC).
The opposition joined forces with the ruling party in endorsing amendments
to a plethora of pieces of legislation, among them, Constitution of Zimbabwe
Amendment Number 18, which harmonised elections. The 18th amendment is seen
paving the way for President Robert Mugabe to handpick his successor through
an electoral college.
The opposition also co–sponsored amendments to tough media and security
legislation– the Access to Information and Protection of Privacy Act and the
Public Order and Security Act.
But the MDC wants President Mugabe and ZANU–PF to fulfill their part of the
bargain.
They want ZANU-PF to agree to the setting up of a committee of four that
will draw up a transitional constitution before the elections and shift the
election date to mid–year to allow the implementation of all changes agreed
upon.
Those privy to the negotiations report sharp differences over the
composition of the members of the Zimbabwe Electoral Commission (ZEC), which
the opposition says is packed with ZANU–PF functionaries and former military
personnel they accuse of being biased against the opposition.
President Mugabe has declared that elections will be held in March without
fail, a feat that is impossible to pull off, Tsvangirai said last week.
ZEC chairman, George Chiweshe, told state media on Sunday there would be no
postponement, adding to the tensions. The parties also do not see eye to eye
on the role of international players in the monitoring and supervision of
elections, as the government has hinted it will only invite “friendly”
foreign organisations as observers.
Jacob Mafume, coordinator of Crisis in Zimbabwe Coalition, agreed with
Madhuku on the need for an independent electoral commission and other
conditions stipulated under the SADC guidelines on what constitutes
democratic elections.
“What we have in the country at the moment is a recipe for disaster in the
composition of the electoral commission. What we have in place is not an
independent electoral commission by any imagination but a partisan one that
is cherry–picked by the incumbent,” said Mafume.
“Another lesson from Kenya is that we need to be clear as to how the results
of the elections are announced. They should be announced at every polling
station, and not only at the command centre, where the results can be
manipulated.
“People in Kenya went on the rampage to protect their votes because they
have strong suspicions that the vote was stolen by the incumbent who used
state apparatus to rig the outcome,” said Mafume.
The opposition claims that ZEC has set constituency and ward boundaries to
give President Mugabe and ZANU–PF an advantage.
According to Tsvangirai, the opposition refuses to participate in a “ritual
to legitimise” President Mugabe through a flawed election. He warned: “To
register our displeasure and to place our revulsion on the record, the
people are ready to express themselves for an immediate end to the cash
crisis. An exhibition of people–power shall see a speedy implementation of
the Pretoria agreement, in particular the resolution of sticky points
threatening to derail our progress.
“Other options on the table, should the deadlock remain entrenched, include
a national shut–down and a series of lawful mass action activities to pull
the nation out of the deep hole. The year 2008 provides us with abundant
opportunities for a permanent solution to the national crisis.”

Millers press for review of maize-meal price

FinGaz

Kumbirai Mafunda Senior Business Reporter

ZIMBABWE’S troubled millers are pressing for an urgent review of the retail
price of maize meal to avert the imminent collapse of the grain milling
industry.

The Grain Millers Association of Zimbabwe (GMAZ) warned this week in a
letter to the state-run and Soviet styled price regulatory body — the
National Incomes and Pricing Commission (NIPC) — that production costs had
built up phenomenally and were now threatening to plunge the sector into
bankruptcy.
GMAZ said it was now economically unviable to sell maize meal at a producer
price of $145 000 for a 5kg bag last gazetted in September.
At $145,000 the price of a 5kg bag of mealie-meal is $5,000 less than that
of a freezit.
A miller would have to sell seven 5kg bags in order to buy a copy of the
daily Herald.
“Our current prices, last gazetted on 24 September 2007 are now way too
below economic production costs. Packaging and transport now constitute 56
percent and 25 percent (of our total costs) respectively. These two main
costs are expected to increase again considerably given the fact that they
are directly indexed to international oil prices, which now reached an all
time high. Labour costs are also going to rise as the trade union is pushing
for above inflation wages,” GMAZ chairman Tafadzwa Musarara wrote in a
letter to NIPC chairman Godwills Masimirembwa.
To operate viably and to avoid the impending bankruptcy GMAZ has sought
approval to sell a 5kg bag of maize meal for $2.4 million and $4.8 million
for a 10kg bag.
The milling body, which has filed four unsuccessful applications with the
NIPC seeking a price review, said delays to approve the new retail and
wholesale prices had caused serious distortions in the market.
“Millers, as consumers of other products need prices that are in tandem with
price increases that you approve for other sectors so as to sustain
production viably,” said Musarara.
Musarara said if granted an economic price structure millers would boost
maize meal output to 15 000 metric tonnes per week and help end the current
maize meal shortages gripping the country.
NIPC sources told The Financial Gazette this week that submissions from the
milling industry would only be considered once President Robert Mugabe, who
is out of the country on his traditional annual leave, is back at his
Munhumutapa offices.
The impasse over prices is also bleeding the Grain Marketing Board white,
which has had to heavily subsidize the price of grain sold to millers.
Because of the tight lid on the prices of grain, there have been massive
distortions in the cost structures for the milling industry.
For instance, transport and packaging costs, which ordinarily carry a lower
weighting, have overtaken the cost of grain.
However, government still believes that because it is subsidising the price
of grain, then the unit cost of the end product should remain stagnant. This
is despite soaring inflation, estimated to have risen above 24,000 percent.
Zimbabwe is grappling with one of its worst food shortages since
independence amid reports that more than four million people are living on
the edges of starvation.
Apart from food shortages Zimbabweans are also battling with cash, fuel and
electricity shortages.

ZINWA: Consumers getting raw deal from troubled authority

FinGaz

Stanley Kwenda Staff Reporter

A DEVASTATING outbreak of diarrhoea and water-borne diseases in Harare’s
teeming suburb of Mabvuku has raised a major health emergency that
highlights the continued crumbling of the quality of urban life in Zimbabwe.

As government officials moved in with ZTV cameras in tow to appear to be in
control of the situation, fresh questions are being asked about the role of
state-run Zimbabwe National Water Authority (ZINWA) in the crisis.
A shocking figure of 400 cases of cholera have been reported in Mabvuku — a
high-density suburb situated some 17 kilometres east of the capital — over
the past two weeks, prompting Health Minister David Parirenyatwa, to spring
into action.
Talent Chikomo, a resident of Mabvuku for 20 years, blames the national
water authority for the festering crisis.
“We started having all these problems when ZINWA came in. Before that, we
did have problems, but they were attended to quickly. We were treated as
people. Now, if you report a burst sewer pipe, nothing happens,” said
Chikomo.
Aging sewerage systems, which ZINWA inherited from councils, can no longer
cope with the population explosion, and spew raw sewage onto the streets.
Residents in most towns and cities where the water supply situation has
deteriorated rapidly over the years now use any secluded spots to relieve
themselves.
Bushy places have become a war zone between men and women fighting for
privacy when they go out to answer the call of nature.
But beneath this tragi-comic scenario lies a deep-seated national disaster
waiting to explode, and ZINWA is at its centre.
And sadly, the national threat comes at a time when the health delivery
system is in critical condition owing to the shortages of drugs, equipment
and the brain drain involving mostly doctors, nurses and pharmacists.
Industry, which is operating at less than 20 percent capacity, has not been
spared by the water shortages either.
As soon as ZINWA, whose role was previously restricted to bulk water
supplies, arrived on the scene in 2006, urban people quickly learnt to cope
with endless water problems plus the stench of raw sewage flowing onto their
doorsteps.
ZINWA, whose board was dissolved last month following a spate of
resignations, has blamed everything and everyone else, including the public,
except its own inefficiency.
In the past, the water authority cited droughts to explain its inability to
cope with urban demand.
But visiting Lake Chivero, the main source of potable water for Harare, last
weekend and seeing it full, leaves one with no option but to conclude that
the culprit is ZINWA.
“The people of Mabvuku have been drinking water from unprotected sources for
a long time, and to say that the 400 reported cases of diarrhoea were caused
by a burst water pipe is simply stretching the truth,” said Collins
Chihwehwete, a resident of Mabvuku.
“It is amazing how water is overflowing at Lake Chivero (formerly Lake
Mcllwaine), but still we have no water in our homes. Who else can we blame
in such a case but ZINWA?”
The Herald reported on Monday that the country’s major dams were now 87
percent full, quoting, ironically, statistics provided by ZINWA.
So, what is the explanation for the water cuts?
“ZINWA’s takeover (of water supplies) has actually worsened the problem of
water shortages. In all fairness, the coming in of ZINWA heralded a new era
of increasing water shortages,” said Jabusile Shumba, senior programmes and
advocacy officer for the Combined Harare Residents’ Association.
But with ZINWA extending its influence into all major towns and cities, its
inefficiencies might force the government to spend more on controlling
health disasters such as the outbreak of cholera and other water borne
diseases.
To make matters worse, following the collapse of healthcare delivery,
hospitals that have been hamstrung by constant strikes are hardly providing
any treatment for water borne diseases.
Research commissioned last year by Transparency International Zimbabwe into
the state of governance within Harare Municipality showed that chronic water
and sewer problems contributed to the outbreak of diseases in the city.
“Those who live in suburbs in the capital where raw sewage flows through the
streets and where the stench of uncollected garbage fills the air are
unlikely to agree that Harare is the Sunshine City,” the report said.
The report said young children living in poor parts of Harare are at great
risk of contracting disease.
The study established that the Harare City Council has become a hotbed of
corruption, with party stalwarts and those close to people in the corridors
of power being awarded service and supply contracts without going to tender
or declaring their interest, contrary to the Local Government Act.
A commission appointed by Local Government Minister Ignatius Chombo after he
hounded elected opposition mayor Engineer Elias Mudzuri and his entire
council from office is running Harare.
Chombo has ignored court rulings to dismiss the commission, perpetuating a
situation that bars ordinary residents from having a say in the running of
municipal affairs.
The Harare City Council and ZINWA teamed up this week to drill about five
boreholes in Mabvuku to provide residents with clean water.
But council’s waste management division is still not collecting garbage,
meaning the health threat will remain.
The water crisis in the mining town of Kwekwe casts useful light on ZINWA’s
incompetence.
The town was previously one of the few urban centres that had a constant
water supplies. This was because the Zimbabwe Mining and Smelting Company
(ZIMASCO), one of the city’s largest industries, had a deal with the
municipality under which it used its own foreign currency to import water
treatment chemicals for the city, in exchange for exemption from paying for
the water it used at its smelter. This secured Kwekwe’s chemical needs and
ensured taps never ran dry.
But ZINWA, upon taking over jurisdiction for water management, cancelled the
arrangement with ZIMASCO, which has been taken-over by China’s largest
importer of chrome, Sinosteel.
Now, even with its supply dam, Sebakwe, more than 100 percent full, Kwekwe
goes for days without water because ZINWA does not have the foreign currency
to import chemicals.
In Bulawayo, residents were confronted with muddy water flowing from their
taps over the festive season.
Despite its inability to deliver, ZINWA opposes the drilling of boreholes by
residents.
“No one is allowed to drill a well without permission from ZINWA. The reason
why ZINWA insists on approving the wells is to ensure that they are dug
correctly without endangering the lives of the people using them,” said
Tsungirirayi Shoriwa, ZINWA spokesperson.

Zimbabwe still friendly to investors

FinGaz

Charles Rukuni Bureau Chief

BULAWAYO — Zimbabwe has the highest inflation in the world. One United
States financial magazine this week put it at over 500 000 percent.

Officially it is reported to be anything between 14 000 and 24 000 percent.
But whenever one talks about where to invest, its name keeps on popping up.
Despite the economic meltdown that has seen its wealth decline by nearly
half, Zimbabwe remains one of the best investment destinations in Africa,
now the focus of those seeking better returns on their investment.
The interest cuts across the world. One of Australia’s richest men is
already in Lornho, one of the economic powerhouses during the colonial era,
spearheading the campaign in London through a new company called LonZim.
China, one of the fastest growing economies at the moment, has lined up
several projects.
Merrill Lynch in the United States has drawn up a list of top companies to
invest in.
A South African investment firm said investing in Zimbabwe was not for the
faint–hearted but there were some handsome returns for those with an
appetite for risk.
LonZim which is now listed on the London Alternative Investment Market has
taken the lead and has brought with it one of Australia’s richest men, James
Packer.
It has already purchased two operating companies in Zimbabwe, stock exchange
listed Celsys, a telecoms and IT company that prints cheque–books, mobile
phone recharge cards and has a Nokia concession in the country and
Gardoserve, which makes chemicals for the textiles industry.
LonZim says while it will not have a particular sectoral focus, it will seek
to identify individual companies in sectors best positioned to benefit
should there be positive improvements in Zimbabwe’s economy.
It is likely to make investments in the tourism, accommodation,
infrastructure, transport, commercial and residential property, technology,
communications, manufacturing, retail, services, leisure, agricultural and
natural resources sectors.
It may also make investments in businesses outside Zimbabwe that have a
majority of their operations within Zimbabwe and will look into expanding
businesses and brands currently owned by Lonrho or in which Lonrho has an
interest in Zimbabwe.
China has several projects lined up. A Chinese company, Sinosteel, has just
bought a 92 percent stake in ferrochrome company ZIMASCO, which was once
owned by Union Carbide.
Last year two Chinese companies said they had entered into joint ventures
with Dande Holdings to build thermal power stations and to enter into
mining.
Qatar based Venessia Petroleum said it wanted to build a 120 000
barrels–a–day refinery in the capital, Harare. It planned to invest US$1.5
billion in the project.
Implats, the world’s second largest platinum producer, and Aquarius, are
busy expanding their projects and negotiating their way out of the
government’s indigenisation programme.
But what is more interesting is a study by Merrill Lynch of the United
States, entitled: Africa – the final frontier.
The study identified 100 companies in 20 countries, which it said investors
should watch.
Zimbabwe has nine out of the top 50 African companies.
It dominates the financial services sector with three of the five companies
mentioned.
These are Barclays Bank Zimbabwe, now the country’s largest commercial bank
in terms of assets, FBC Holdings, where the ruling party is reported to have
a stake, and CBZ Holdings, which was rescued by the government after the
collapse of the Bank of Credit and Commerce International.
Barclays has raised a lot of international interest because of the money it
has poured into agriculture at a time when everyone considers it the
riskiest investment because of the government’s controversial land reform
programme.
Zimbabwe has two companies in the retail sector: Cairns and TA Holdings; one
in the telecommunications sector, Econet; and another in the commodities
sector, Bindura Nickel Corporation.
It has Border Timbers in the infrastructure sector and Hippo Valley in the
agricultural sector. Anglo–American once owned both but Border is now part
of the Radar group.
The question most people have been asking is why the interest in a country
that everyone, including its nationals, seems to have written off? The
answer is simple. They are looking beyond the current problems.
David Lenigas, executive chairman of Lonrho and LonZim says: “LonZim will
only be able to achieve its investment objective in the event the Zimbabwean
economy radically improves.”
But he is quick to add: “We believe that Zimbabwe offers a unique and
considerable investment opportunity as a direct result of the current
economic climate and as a result of a lack of direct foreign investment. We
believe that Zimbabwe will, in due course, regain its position as a
significant economic powerhouse in Africa.”
Management consultant and former Zimbabwe National Chamber of Commerce
president Luxon Zembe says Zimbabwe has tremendous potential. “It’s
incredible.”
Investors are looking at the future. They know that there is nothing that
does not come to an end.
“This phase we are going through is going to come to an end so some people
are already looking beyond the horizon.”
Returns in Zimbabwe are handsome. The key industrial index of the Zimbabwe
Stock Exchange (ZSE) for example is reported to have grown by over 24 000
percent last year.
The ZSE was rated the best performer in the world in 2007.
The Johannesburg Stock Exchange, the barometer of the region’s economic
powerhouse, South Africa, was a distant 42nd growing by only 18 percent
while Botswana fared better at number 23. Its bourse grew by 37 percent.

Disaster in agric production looms

FinGaz

Zhean Gwaze Staff Reporter

THE government’s hopes to make the 2007–8 agricultural season a success
could turn out to be the “mother of all disasters” due to excessive rains
and late planting by most newly resettled farmers.

Incessant rains have resulted in most fields being waterlogged and farming
experts this week said most crops could have been salvaged if farmers had
planted earlier.
The experts said the heavy rains would not have been an issue for commercial
farmers because of proper planning methods they use but for the bulk of the
new farmers who depended on government for support, a disaster looms.
Top dressing fertiliser, which is critical during this time of the farming
season, is now reportedly in short supply.
Agriculture remains the backbone of the country’s economy.
In 1998, it accounted for 28 percent of Zimbabwe’s gross domestic product,
broadly defined as the total value of goods and services produced by a
country in a year. Then it employed an estimated 66 percent of the country’s
workforce.
But emotive land reforms have taken the country several decades back.
The government in 2000 embarked on agrarian reforms when vast tracts of land
belonging to white commercial farmers were forcibly allocated to landless
blacks to address historical land imbalances.
The exercise saw agricultural production plummet and foreign currency
earnings from tobacco, largely, suffering a heavy blow.
Critics blame the haphazard land reform programme for compounding the
country’s economic crisis now in its ninth year although President Robert
Mugabe’s government blame travel restrictions imposed by Australia, the
European Union and the United States for precipitating the economic
meltdown.
Although the government distributed farming implements to new farmers last
year, it failed to provide fertiliser, and yet the heavy rains being
experienced have resulted in nutrients in the soil being washed away.
“For most commercial farmers’ crops would have grown and absorbed all the
nutrients but for the new farmers it is not looking good at all.
It will be the mother of all disasters,” said John Worsley Worswick, chief
executive officer of Justice for Agriculture (JAG).
JAG represents about 4 300 white commercial farmers dispossessed by the
government’s fast–track land reform programme.
“Unless there is adequate fertiliser to replenish what is being leached,
then this season will be a disaster,” said Commercial Farmers Union
president Trevor Gifford.
Renson Gasela, the Movement for Democratic Change spokesman for agriculture,
said excessive rains should not be cited as an excuse for what he expects to
be a poor harvest.
“As only a third of the seed maize has been planted, we need to save that
small crop. Top dressing fertilizers must be made available, otherwise this
mini crop will be a total write-off,” said Gasela.
“Once again, the government cannot escape the blame, not for copious rains,
but for the perennial failure to have sufficient seed and fertilizers .We
cannot blame rain. The weather forecasters had already predicted above
normal rains. What preparations were done? Nothing, except promising the
farmers seed and fertiliser imports even as late as end of November 2007.”
Finance Minister Samuel Mumbengegwi predicted a 4 percent growth in
agriculture notwithstanding drought conditions experienced during the
2006/07 cropping season.
But critics say Mumbengegwi’s forecast is wishful thinking, given the
state-orchestrated confusion on the farms.
JAG’s Worswick said a third of the 400 remaining members of his union still
on the land were idle as evictions continue.
The 400 remaining white farmers in the country are banking on the Southern
African Development Community (SADC) tribunal’s interim relief order issued
against the government, which allows them to remain on their properties.
Worswick hoped the SADC order would be extended to protect all the remaining
farmers.
The interim relief order, granted in Windhoek, Namibia, late last year,
protects William Michael Campbell and his family and all his employees from
takeover.
Government had forecast that two million hectares would be put under maize
and would yield three million tonnes.
However a recent report prepared by the Agricultural Technical and Extension
Services (Agritex), showed that just over 1.3 million hectares had been
tilled and only 719 000 hectares had been put under maize.
Agritex said a shortage of inputs, such as fuel, seed, fertiliser and
chemicals had affected planting.
“Farmers are also overwhelmed by weeds as there is a shortage of herbicides,
and this also affects the well being of crops,” another agricultural expert
said.
About four million people require food aid before the next harvesting season
in April.
State media reported on Tuesday that Zimbabwe would need to import at least
one million tonnes of maize after deliveries of the 2007 crop to the state
grain procurer, the Grain Marketing Board, amounted to only 700 000 tonnes.
Zimbabweans consume 1.8 million tonnes of maize annually.

Zimbabweans lose confidence in own currency

FinGaz

Stanley Kwenda Staff Reporter

UNTIL the widely condemned Operation
Murambatsvina in 2005, Zimbabweans could count on housing among the few
basic needs they could afford.

But following the operation, which affected
2,4 million people, according to the United Nations, when thousands of
informal urban homes were razed to the ground, Zimbabweans now face a
serious problem of accommodation.
Other destructive policies introduced by the
government since, such as the price cuts last July, which led to food
shortages and the soaring of prices on the parallel market, have also made
life an everyday struggle for survival. As businesses were forced to import
foodstuffs and inflation shot to unprecedented levels, one important result
has been the “dollarisation” of the economy.
Dollarisation occurs when the inhabitants of a
country use foreign currency in parallel to or instead of the domestic unit.
Wikipedia, the most frequently used online
reference point, cites Ecuador, El Salvador and Panama among the economies
that have dollarised their transactions.
Zimbabwe seems to be taking the same route if
the events of the past months are anything to go by.
With foreign currency having dried up on the
official market owing to poor export performance and donor fatigue,
individuals, companies and organisations are increasingly relying on
non–official sources for their foreign currency requirements.
But because inflation if fast eroding the
value of the local unit, which has been under pressure since November 1997,
it is becoming risky to demand payment in Zimbabwe dollars. And as a result,
most goods and services are now being pegged in foreign currency, including
school fees, rent, cars and in some instances foodstuffs.
The shortage of cash has not helped the
situation either, as people with access to foreign currency now prefer to
transact in foreign currency.
Government calls this dollarisation sabotage,
but economists say this makes sense under the prevailing economic situation.
“The dollarisation of the economy is caused by
inflation. The currency is losing value at a continuous rate.
“It has become very cumbersome to be always
reviewing prices. Because of this unstable environment, it becomes easier to
quote prices in a stable currency such as the United States dollar or the
South African rand,” said Witness Chinyama, analyst at Kingdom Financial
Holdings.
Informal dollarisation was flourishing, even
if government refuses to accept the fact. Chinyama said: “Authorities have
outlawed the use of foreign currency. There is however, a semblance of
official dollarisation by the government, which has been quoting duty on
assets such as vehicles in foreign currency.”
Official documents, such as passports, now
“officially” require one to pay in foreign currency. The Registrar General’s
office now charges US$220 for a passport. In a tacit admission of the
weakness of Zimbabwe’s own currency, government now also demands duty in
foreign currency on hundreds of items it deems as luxury items, including
motor vehicles.
Analysts say the dollarisation of the economy
is simply “a show of the extent to which people have lost confidence in the
local currency.”
“It’s a situation which is forcing people to
be criminals overnight, because if you want to import a car you have to get
the required foreign currency to pay duty on the informal currency market,”
said Chinyama.
A Harare businessman said government should
allow businesses to peg prices in foreign currency until it stabilises the
economy.
“Whether the government criminalises the use
of foreign currency or not, the fact is that people will still factor in the
foreign currency component in determining the value of their possessions.
Criminalising the use of foreign currency is not a solution, what the
government should simply do is to fix the economy and restore the value of
the Zimbabwean dollar,” he said.
The streets of Harare are awash with foreign
currency and, with the current cash shortages, it is not a surprise to see
several people transacting in foreign currency. Countries such as Namibia
have pegged their currencies to stronger units, allowing a dual currency
system where the Namibian dollar is used together with the South African
rand.
A cash-starved Harare resident who identified
himself only as Roy argued in a letter to the editor published in a weekly
newspaper recently: “Our stock of cash seems very low at US$30 million. In
value terms there are more US dollars in circulation than Zimbabwe dollars.
This is a recipe for collapse of trade and commerce.”

Committee urges ZESA to lease idle power stations

FinGaz

Njabulo Ncube Political Editor

A PARLIAMENTARY committee has recommended that ZESA Holdings be allowed to
lease out its three idle thermal power stations to private investors as the
economy reeled under worsening power outages after Mozambique became the
latest neighbour to cut off supplies to Zimbabwe.

The power utility’s Munyati, Harare and Bulawayo thermal power stations are
currently not in operation due to a crippling shortage of coal from Hwange
Colliery Company.
The Parliamentary Portfolio Committee on Mines, Energy, Environment and
Tourism, said leasing the idle thermal stations to private players would
boost capacity utilisation in industry, which has hit an all-time low.
“Government should lease out small thermals – Munyati, Harare and Bulawayo
to companies, which are able to run them. This will in some way give a
respite to industries and businesses in the nearby vicinity,” reads part of
the report.
It is estimated that most businesses are operating at less than 30 percent
capacity with mines operating for only four hours out of the 24-hour
schedule.
Gold production for last year is expected to be at an all time low of below
eight tonnes in comparison with three years ago when the country produced 21
tonnes.
Members of the committee chaired by Binga legislator Joe Gabuza blame the
low capacity utilisation on frequent power outages caused by ZESA’s failure
to expunge its debts with regional electricity utilities such as Hydro
Cahora Bassa (HCB) of Mozambique and Eskom of South Africa. The committee
noted that communications networks have been experiencing continuous
congestion partly due to power outages, adversely affecting business.
The poor wheat yields of 2007 were partly blamed on ZESA after power outages
disrupted irrigation.
“The situation is making it difficult for companies to plan because
disruptions usually occur without notice. The committee was deeply worried
by the fact that most of these sectors play a key role in the generation of
foreign currency,” it said. The power cuts had a more widespread social
impact, the legislators said. “Social gatherings and other activities have
been affected by power disruptions. It has become difficult for ordinary
households to plan their activities, such as cooking. Most families are
spending more money looking for alternative sources of energy,” it said.
The committee said while government had a responsibility to cap tariffs in
order to protect the poor, ZESA as a service provider, should still
guarantee a reliable and continuous supply.
The report revealed that the country had not paid its debts, for the period
March to August 2007, totalling US$42 million, to various regional
suppliers, among them HCB. As a result, South Africa and Zambia discontinued
supplies several times last year. Zimbabwe normally imports a third of its
electricity, or 500 megawatts, but this has been reduced to 150 megawatts.
However, this week, Mozambique was reported to have switched off power to
Zimbabwe due to an outstanding debt of about US$26 million owed to HCB.

Zesa Sinks U.S.$20m Into Hwange Revamp

Financial Gazette (Harare)

10 January 2008
Posted to the web 10 January 2008

Kumbirai Mafunda
Harare

POWER utility ZESA Holdings has sunk over US$20 million out of US$40 million
in the refurbishment of power generation units at Hwange Power Station.

ZESA chief executive officer Ben Rafemoyo told The Financial Gazette this
week that the overhaul of the thermal power station had already chewed up
more than half of the allocated US$40 million.

"Out of the US$40 million a little over US$20 million has been drawn down,"
said Rafemoyo.

ZESA entered into a strategic alliance with Namibia's state-run power
company NamPower last February to refurbish power generation units at Hwange
Power Station at a cost of US$40 million.

Under the historic deal NamPower made provision to finance the foreign
currency component for the rehabilitation of Hwange Power Station stage 1
units and subsidiary plant and in turn import 150MW for a period of five
years from Hwange.

The ZESA-NamPower project is expected to ease the country's agonising power
outages, as it will result in increased power generation capacity to 500MW
from the current 250MW.

However, Rafemoyo said the overhaul of the power generation unit, which was
scheduled for completion last December, will now be completed this month due
to delays encountered in the procurement of replacement spares before
re-commissioning the power generation unit.

Rafemoyo said after the completion of unit 3, ZESA will undertake the
refurbishment of units 2 and 4.

"We want to increase them (power generation units) to four this January,"
said Rafemoyo.

ZESA is battling to increase local power generation to make up for reduced
power imports from traditional regional suppliers who have pulled the
reduced or stopped power exports to Zimbabwe over unsettled arrears.

Zimbabwe used to generate about 60 percent of total national power
requirements through Kariba South Power Station and Hwange Power Station,
with the balance of 40 percent being met through imports from Snel of the
Democratic Republic of Congo, Mozambique's HCB, Eskom of South Africa and
ZESCO of Zambia.

But low foreign currency reserves over the past eight years have impeded the
troubled southern African country from accessing additional power supplies
resulting in frequent and disconcerting power outages.

Zimbabwe is using the little foreign currency still trickling into its
coffers to pay for vital fuel and food imports to keep the country going.

Besides a hard currency crunch, ageing equipment and inadequate coal
supplies have hampered local generation capacity.

Country is Named Worst Economic Freedom Violator

Financial Gazette (Harare)

10 January 2008
Posted to the web 10 January 2008

Staff Reporte
Harare

ZIMBABWE has been ranked among the worst violators of economic freedom
worldwide, adding another smudge to the country's widely condemned human
rights record blamed for an economic crisis now entering its ninth year.

The 2007 Index of Economic Freedom, compiled by the Washington based
Heritage Foundation and the Wall Street Journal and released at the end of
last year, showed that Zimbabwe anchored the 157-country list of economies
whose operating environments were reviewed by the economic think tank.

Results of the study showed that Zimbabwe scored 30 percent.

The Index of Economic Freedom is calculated on a scale of zero percent to
100 percent.

"Zimbabwe ranked bottom, followed by Congo Brazzaville and Angola," the
foundation said in its commentary.

Economic liberties are judged following a 10 point criteria that includes
business freedom, as evidenced by liberalisation and privatisation policies,
trade openness, fiscal freedom, investment freedom, freedom from heavy
bureaucracy, monetary freedom, property rights and flexibility of the labour
market and laws on minimum wages, among other issues.

Zimbabwe has reneged on previous plans to privatise its loss making
parastatals and stands accused of property rights violations committed
mainly during the controversial agrarian reforms, which started in 2000.

Economic analysts this week said the unfriendly policies, which include the
prices cuts announced by the government of Zimbabwe in July last year,
together with the proposed indigenisation and empowerment laws that will
force foreign owned companies to cede substantial stakes to locals, had led
to the poor scores Zimbabwe garnered in the annual research.

The indigenisation laws are likely to enable the government to take up to 25
percent shareholding in mining companies for free.

Foreign banks, Standard Chartered Bank and Stanbic Bank have warned that the
hostile laws would trigger a surge in capital flight.

But the government has declared that any foreign owned company that would be
uncomfortable with the policies was free to leave.

"If Standard Chartered Bank feels they cannot continue (operations in
Zimbabwe) they can simply go and CBZ can take over. Metropolitan Bank can
take over, and FBC can do the same," Indigenisation minister Paul Mangwana
told a Parliamentary committee last year.

But what was striking in the results of the index was the inclusion of
China, the world's fastest growing economy, in the group of restrictive
economies.

Just eight countries were deemed moderately free and 25 were described as
unfree, with seven of them falling into the unfree zone whilst seven fell
into the repressed listing.

The five freest nations were Mauritius with a global ranking of 34 percent,
Botswana 38 percent, South Africa 52 percent, Namibia 55 percent and Uganda
59 percent.

Graft is enemy No.1

FinGaz

Comment

A WORLD Bank Institute (WBI) report revealed recently that Zimbabwe was
among the few African countries in the throes of a precipitous economic
decline due to endemic corruption. This is hardly surprising!

Transparency International (TI)’s ranking of corrupt countries has shown
Zimbabwe steadily sliding down the ladder to take up the worst spot among
continental states ravaged by graft.
The rot has become so entrenched that it has ceased to be viewed as
disgraceful but a way of life. And it has hit at the heart of central
government.
Government’s machinery to deal with the vice seems to have been attacked by
the virus as the festering cancer of corruption spreads.
President Robert Mugabe has previously admitted the existence of rampant
corruption among top members of his ruling party and Cabinet.
But despite an array of enabling legislation and state arms to deal with the
vice, these agents lacked the teeth to bite these real economic saboteurs
sowing seeds of corruption.
A report detailing massive looting at ZISCO involving politicians in high
places was last year suppressed, while nothing has been done to apprehend
top officials plundering the country’s precious minerals despite startling
revelations by the police that they have the names of senior government
officials behind the smuggling of gold.
A report by the Comptroller and Auditor General released early last year
revealed widespread graft in government, with blatant violation of
procedures in the issuance of monetary advances to officials. The report
also highlighted widespread incompetence within government and the uniformed
forces.
Government has responded by punishing the small fish and runners, as has
been the case with the current war against “cash barons,” and not those at
the epicentre of corruption.
The WBI said while the quality of governance in 212 countries measured
between 1996 and 2006, had greatly improved, Zimbabwe, together with Cote d’lvore
and Venezuela were exceptions.
While government created institutions such as the Anti Corruption
Commission, and even a ministerial portfolio specifically tasked with
dealing with the scourge, nothing on the ground suggests the country is
moving forward to deal with corruption.
The worrisome thing is that corruption is more rampant in high places, and
subordinates have joined in because of the get-rich-quick syndrome now
characteristic of attitudes among the country’s restive workforce.
It is now common to pay someone a bribe in order to get a passport, or any
other service, without waiting in the long-winding queues that are now a
common feature in the country.
And the culprits in government know too well that their bosses will not deal
with them because they are themselves the major drivers of dishonesty. This
is not to say corruption has only been confined to the public sector alone.
Corruption levels are equally worrisome in the private sector, both at
executive level and on the shopfloor.
A worrying trend, though, is the entry of ordinary folks into the corruption
culture. High inflation has eaten into incomes, and to escape the erosion of
their purchasing power, workers are engaging in all manner of illicit
activities to survive.
Economic distortions are also prevalent in the economy, creating arbitrage
and corrupt business practices. Multiple fuel and maize prices as well as
fickle exchange rates are fuelling corrupt tendencies.
Government officials and their cronies are getting cheap, subsidised fuel
and staple grains from the state granary, which they are quickly selling on
the black market at extortionate prices.
Others are accessing foreign currency from the official market at hugely
discounted rates, only to sell the scarce resource on the thriving parallel
market at exorbitant prices.
When these corrupt tendencies become entrenched in an economy, and are made
to partner skewed economic policies, a breakdown of the rule of law, and the
government’s destruction of the commercial farming sector – previously the
bedrock of the country’s economy – there is potential for a major economic
condensation.
Zimbabwe’s gross domestic product has contracted by a cumulative 40 percent
over the past eight years, and it has the largest budget deficit in the
world at over 10 percent. This has the effect of undermining confidence in
the economy.
Levels of confidence in business and the economy dropped from 50 percent to
9 percent between 2000 and 2005, according to independent studies.
Last year, government announced its intention to conduct a baseline survey
to determine the level of corruption in the country.
The survey, officials said, was meant to debunk the myth created by
international bodies like WBI and TI, which ranked Zimbabwe among the most
corrupt countries in the world. The survey was commissioned in February, but
has been stalled by the lack of funding.
Even the Anti-Corruption Commission established a year earlier has failed to
grit its teeth against powerful politicians busy plundering the country with
impunity.
It’s time the powers-that-be moved forward by showing real commitment
towards tackling widespread corruption derailing economic revival efforts.

Where is Chombo when the nation needs him?

FinGaz

Mavis Makuni

Even the most rabid propagandist must admit that it is now ridiculous to
continue to pretend that all is well in this country and to cast aspersions
on those Zimbabweans who are disturbed by this state of affairs and call a
spade a spade.
Not long ago, Information Minister Sikhanyiso Ndlovu was urging foreign
journalists to tell "the true story of Zimbabwe" which is propaganda speak
for sunshine journalism. But if the minister is honest, he will admit that
even the official press now struggles to gloss over the myriad problems
calling for realism and pragmatism rather than political expediency and
self-preservation.
Recent issues of the state daily, The Herald, have featured stories about
the continuing water problems in the capital and other urban centres. An
outbreak of diarrhoea has been reported in Tafara and Mabvuku where 400
people have been taken ill. As usual only reactive rather than proactive
measures are being taken. The health hazards leading to the outbreak of
disease were a result of the failure of the Harare City Council to collect
garbage from residential areas and the Zimbabwe National Water Authority's
notorious inefficiency. The Herald reported in its issue of January 5 that
the two suburbs had been experiencing erratic water supplies and blocked
sewers. The extent of the dereliction of duty by the responsible authorities
is reflected in the official daily's description : "Yesterday ZINWA workers
were on the ground removing raw sewage with excavators on roadsides and open
spaces close to houses."
An accompanying picture showing an excavator digging into a mountain of
refuse gives a rough idea of how long the city council had not bothered to
collect and dispose of garbage from the area. The Minister of Health and
Child Welfare, David Parirenyatwa is reported to have paid a belated visit
to the two suburbs, triggering the flurry of activity that should be
undertaken routinely under normal circumstances. Official spin doctors will
try to project the stop gap attempts now being made to deal with the crisis
as an achievement for which the government should be praised. Rather than
being an achievement, the piece meal measures are confirmation that because
of rampant corruption, ineptitude and dereliction of duty, service delivery
has collapsed throughout the country.
Tuesday's issue of The Herald had more disturbing news. The paper reported
that the Environmental Management Agency had summoned the Harare and
Chitungwiza city councils to explain their dereliction of duty which had
resulted in their failure to collect garbage from residential areas in
Mabvuku, Tafara, Kuwadzana, Chitungwiza, Glen view, Glen Norah, Mufakose and
Budiriro. These are densely populated areas where disease can spread like
wild fire. The inefficiency of the responsible authorities puts the health
of great numbers of residents at risk. The local authorities also stand
accused of discharging raw sewage into the environment. It is a nightmare
for the people to live in these dangerous conditions as a resident from one
of the affected suburbs explained when she told the state daily: "We want to
live in a healthy environment. We have suffered a lot due to water cuts but
at least they have heard our cries."
The big question to ask amid all this squalidity and disease is why the man
responsible for reading the riot act to the inept officials, Local
Government and Urban Development Minister, Ignatius Chombo is no where to be
seen or heard. Where is this notoriously meddlesome minister when he is
needed? Why is he not dealing with the Harare City Council in the same
unrelenting way he targeted the administration of Elias Mudzuri, who had
been elected executive mayor on a Movement for Democratic Change ticket?
Residents still fume at the memory of Chombo's ruthless and shameless
vendetta against Mudzuri, whom he accused of incompetence more than three
years ago.
But looking at the state of affairs today, Harare was a paradise under
Mudzuri's stewardship compared to the stinking dump it has degenerated into
under the commissions appointed by Chombo to run the affairs of the capital
in a flagrant infringement on the rights of residents to elect city
officials of their choice. It is notable that since the dismissal of
Mudzuri, the minister no longer seems to care what happens to urban
residents. Gargabe is not collected from residential areas and un-repaired
potholes have begun appearing even on pavements under gleaming buildings in
downtown Harare.
Readers will remember Minister Chombo giving an MDC chairman of the
Chitungwiza Town Council 48 hours to tackle sewage problems that had been
deteriorating steadily for years because of poor management and lack of
planning by previous administrations. Things have continued to deteriorate
under the hand-picked officials who were brought in by Chombo to replace
popularly elected councillors. When Chombo began his boorish campaign to
remove MDC officials from local councils, the hype was that this was being
done to improve service delivery.
However, an objective assessment of the unmitigated disasters that have
ensued after the forcible takeovers of local authorities and the imposition
of the Zimbabwe National Water Authority to manage water supplies in urban
areas shows efficient service delivery is the last thing on the minds of the
powers-that-be. The driving motive behind their illogical actions is to
usurp control from the MDC and punish the party for enjoying support among
urban populations. Vengeance, in short.
In a national election year, one cannot help wondering what the ruling party
is capable of doing behind the scenes if it can so blatantly subvert the
will of urban residents who voted for the local officials who have been
systematically hounded out of office. Where is Minister Chombo when so many
questions beg answers?
—mmakuni@fingaz.co.zw

Zim judicial system needs overhaul

FinGaz

Matters Legal with Vote Muza
Countless justice-seeking individuals have had their hopes shattered
Two significant developments ensued at the end of 2007, both of them having
a negative bearing on our erstwhile reputable legal system.

First was the industrial action by magistrates and other court officials,
which has left our judicial system heavily compromised, and reeling under a
blotted case backlog.
Worth to note is the fact that this job action was the first in the history
of the country, be it before or after independence.
That this embarrassing development had to take place at such a critical and
delicate stage of our nation’s development was unavoidable.
Lower courts’ judicial officers had had their patience stretched to the
limit after years of false promises by government through its successive
Justice Ministers. Reports that these striking judicial officers were
awarded a 600 percent salary increment are pleasing, but more needs to be
done.
Without appearing like I am turning myself into a trade unionist for these
court staff, I believe that a lasting solution should be to emulate what
happens in the private sector where salaries are now being upwardly reviewed
every month in order to keep up with inflation.
The story should not end there, houses, vehicles and other tangible benefits
should come their way.
If this suggested solution is not implemented, there is a more than
realistic possibility that the events of the past months could repeat
themselves sooner rather than later.
Yet such an embarrassing development should never be allowed to repeat
itself, for if it does then it will mirror the absolute degeneration of our
once proud judicial system.
In the past months, countless justice seeking individuals have had their
hopes shattered, and a lucid example is many awaiting trial prisoners
languishing in remand prison with no magistrates to try their matters.
Resultantly, what becomes apparent is that the abdications of responsibility
by government in leaving this impasse unattended for so long has itself led
to a situation where the justice system has ironically become the number one
violator of people’s human rights.
The second development that has contrasting facets, in that it is both
worrying and interesting is the absconding to the United Kingdom of David
Butau, ruling party parliamentarian and business executive.
Having got wind of the news that he was wanted by the Zimbabwe Republic
Police for questioning, the man wasted no time in clandestinely bolting out
of the country to evade his imminent arrest.
David Butau is no ordinary parliamentarian.
Being the chairperson for the Budget and Finance Committee in parliament
makes him a key member of our august house and the entire law making
process. But lo and behold, this senior, and I believe honorable Member of
Parliament refused to be judged under the laws he makes.
His reason for absconding– that he wanted to avoid “rotting in remand
 prison” obviously raises more questions than answers.
By making such a statement, he unwittingly confesses that for the time that
he sat in parliament, he knew all along that our criminal and penal systems
were hostile to suspects?
And what action did he take as a concerned lawmaker to, not only highlight
the shortcomings of the criminal justice system, but to also introduce
necessary amendments that would revolutionalise our penal system.
To Butau, the fact that many citizens were going through the harrowing and
excruciating experiences of our remand prisons did not matter to him. Thus,
far as long as he was a free man and enjoying the comfort of his wealth, he
did not give a hoot about the appalling status of our prisons.
I bet he was not alone in this, but many other parliamentarians and
influential people are fully aware of the horrible conditions of prisons and
the insidious perversion of partiality, judicial political activism and
corruption that have become the hallmark of some of our courts.
When he saw Chris Kuruneri, James Makamba and many other suspects rotting in
remand, he as a responsible parliamentarian and citizen ought to have raised
alarm that some of our courts had become a dangerous hazard to people’s
quest for justice.
Butau, just like the rest of the parliamentarians who elect to keep quiet
well knowing that our criminal justice system is no longer credible must
suffer the consequences of their hypocrisy and abdication of responsibility.
What has happened to Messrs Kuruneri and Makamba where they spend many
months in remand prison only to be acquitted, that Butau swiftly avoided
through turning himself into a fugitive might happen to any of our senior
state officials.
This is therefore the right time to advocate a return to normalcy to dispel
the widely held perceptions that our justice system is now resembling that
of a banana republic.
The responsibility for lobbying for a drastic overhaul of our criminal
justice system should start with parliamentarians followed by lawyers and
supported by all human rights activists.
David Butau has certainly set a bad precedent and a bad example that I fear
other suspects might emulate and in the end leading to the undermining of
the due process of law since it may become inevitable that a good number of
people facing investigation by police may simply take flight rather than
face prosecution.

FinGaz Letters

Get real about illegal immigrants

EDITOR — Tamupeyi Mupinyuri seems to be under the impression that because
he/she is sitting pretty in the Diaspora so is everyone else. There are so
many illegal immigrants in the United Kingdom (myself included), who are
looking after so many families back home.
Honestly, how can Tamupeyi suggest the deportation of illegal immigrants
just because he/she wants to secure a Visa for a 70-year-old grandmother?
Why be so spiteful.
Anyway, you can go ahead with your shameful suggestion if you think you have
amassed enough wealth to look after the families of all those you want
deported just because they don't have the relevant documents to justify
their continued stay in the Diaspora.
My friend, you should apply your mind on how best you can help those without
proper documents secure them rather than focussing on what you are trying to
do. This is my honest opinion as someone who is also trying to secure the
relevant documents.
Munamato Siziba
United Kingdom
-------------
 Parallel market correct measure of demand

EDITOR — In economics, it is the parallel market, which correctly represents
the equilibrium between supply and demand. The parallel market is beyond the
reach of anyone who seeks to control, manipulate or destroy it.
Being inherently capitalistic, efficient and managed by so many millions of
people, it is capable of reacting to attempted political manipulations at
lightning speed. This was the case in the Soviet Union where 70 years of
strict, heavy-handed clampdowns yielded nothing.
The parallel market is an unstoppable force, a democratisation of resources
and their allocation. It is the mechanism in which the people maintain their
control over their resources, and exercise their democratic freedom to
access them unhindered.
Political manoeuvring to clampdown, destroy, control or subvert the parallel
market is no more and no less than some select elite seeking to commandeer
the resources of the State from the people for their own selfish benefit.
When the economic nightmare the country is going through is finally over, it
will become clear that it is our socialist leaders' greed permeating our
economy.
Capitalists are inherently selfless, seeking to help others by meeting their
needs and solving their problems. Compare that with the socialists in
charge, who seem to do nothing other than incessantly feathering their nests
and manipulating the economic system to ensure they have easy access to
resources by denying the same access to the very people they purport to
serve.
We Zimbabweans must ensure that the last bastion of democracy in our land is
not wrested from our control. We must fight at all costs to maintain a
democratic people-driven system currently labelled the parallel market.
In the free countries of the world it is the parallel market, which
dominates, with the controlled, manipulated and skewed markets of the greedy
being the ones, which face clampdown.
We must maintain our populist answer to the monopolies imposed upon us by a
government we no longer need or want.
It is their monopolies, which we must destroy. We must reclaim control over
our economy and do away with the socialist way of doing things once and for
all.
If we fail to do this we will all surely starve as they (socialists) take
everything for themselves. It is time to take control of our lives.
Ding Dong
Harare
----------
 We don’t need Tsvangirai

Editor—Faction leader Morgan Tsvangirai does not seem to be serious with
regime change because of selfishness and pride.

After all, we will never lose sleep over his dilly-dallying. Whoever
believes the Mutambara formation of the MDC is desperate for unity with the
Tsvangirai faction is living in cuckoo land.
We do not need Tsvangirai to win the March elections.
The MDC has nothing to gain from Tsvangirai, who I believe is now a spent
force.
We do not need to know whether there are formal or informal talks going on
between the two formations of the MDC because we are confident of winning
without any of Morgan Tsvangirai’s backers.
We have had enough of the Buhera boy and we do not need some more of him.
We are ready to vote for AGO in March 2008 not Morgan Tsvangirai or
President Robert Mugabe.
Zimbabwe needs a visionary leader like Professor Mutambara and we do not
regret having him in our midst.

K Chihwayi
Harare
------------
 Where is the promised forex for critical skills retention?

EDITOR —It has been four months since Dr Gono, the Reserve Bank of Zimbabwe
(RBZ) governor announced in his mid-term monetary policy review statement
that exporters could now pay their critical staff in foreign currency as a
skills retention measure.
What puzzles me is that up until now nothing has come through after making
our applications to the RBZ, and our critical staff continues to leave for
greener pastures.
May the governor please come through on this as this is also reflecting
badly on us as employers.

Concerned
Harare
-----------
 You know economy has collapsed when...

EDITOR — Our President has declared on several occasions that the Zimbabwean
economy will never collapse. I do not know whether this is a question of
semantics because, to all intents and purposes, this economy has already
collapsed.
Your Excellency, when your country's currency is so battered that one United
States dollar costs ZWD5,5 million (a whooping ZWD5,5 billion before the
revaluation of the local currency in 2006), then your economy has all but
collapsed.
When the highest denomination in your currency (ZWD750,000) cannot buy you a
pint of beer, that economy has collapsed. When you cannot provide such basic
amenities like power and water to your subjects that economy is collapsed.
When refuse is not collected in over two years, putting the health of your
citizenry at great risk, that economy, Sir, has collapsed.
Maybe your own definition, your Excellency, means having to pick up mortar
and bricks from collapsed buildings on the streets. Even that cannot be far
away.

Masawi Munyanyi
Harare