http://www.theindependent.co.zw/
Thursday, 26 January 2012 18:00
Owen Gagare
PRIME
Minister Morgan Tsvangirai has all but given up on the implementation
of the
Global Political Agreement amid indications that some of the pact
negotiators have grown weary after haggling over virtually the same issues
since the coalition government was formed in 2009.
Some negotiators
indicated that they felt let down by the GPA principals —
President Robert
Mugabe, Tsvangirai and Deputy Prime Minister Arthur
Mutambara — for failing
to deal with all the outstanding issues referred to
them. Mutambara has
refused to relinquish his position despite losing the
MDC presidency to
Welshman Ncube and remains a principal despite having no
negotiators to
brief him.
It has also come to the fore that the principals have not
made any effort to
tackle any of the outstanding issues referred to them by
their negotiators,
thereby prolonging the inclusive government
crisis.
Tsvangirai’s spokesman Luke Tamborinyoka confirmed to the
Zimbabwe
Independent that the principals had failed to find common ground on
outstanding GPA issues, including the election roadmap, and said his boss
felt it would be a waste of time dealing with grey areas when agreed items
had not been implemented.
He said Tsvangirai was pushing for
implementation of the 24 agreed positions
in the election roadmap, but was
facing resistance from Zanu PF ministers
who are supposed to implement many
of the agreed issues.
“We cannot deal with outstanding issues and the
grey areas when we have not
implemented the agreed positions,” said
Tamborinyoka. “Why should we go to a
mountain when there is a plain? As far
as the prime minister is concerned,
you can’t talk about the dark areas when
the clear areas have not been
fulfilled.”
“For example there are
24 issues, such as media reforms and issues to do
with ZEC (Zimbabwe
Electoral Commission) which were agreed on, but never
implemented. There is
massive resistance from Zanu PF ministers, and the
most notorious is the
minister of Media, Information and Publicity (Webster
Shamu). There is
unbridled arrogance from the minister and his officials.”
Shamu was
tasked by the principals to reconstitute the Broadcasting
Authority of
Zimbabwe (Baz), but was yet to do so.
Tamborinyoka added: “Like the
prime minister indicated in his end of year
message, some Zanu PF ministers
are refusing to take instructions and to
implement agreed reforms. And at
this point, we have no power to deal with
them because each minister was
appointed by their party and they report to
their principal,” he
said.
He said indications on the ground were that agreement on
outstanding issues,
such as security sector reforms, would be almost
impossible given statements
emanating from the president’s
office.
“Even the promotion of (Major-General Douglas) Nyikayaramba,
shows that it
will be difficult to have security sector reforms,”
Tamborinyoka said.
In August 2010, Sadc leaders gave the coalition government
partners a 30-day
ultimatum to implement the GPA, but to date none of the
agreed issues have
been implemented.
Agreed items included the
process of the land audit and security of tenure,
appointment of provincial
governors,the appointment of the board of the
Broadcasting Authority of
Zimbabwe and the Mass Media Trust, hate speech,
national heroes and issues
of external interference, among others.
The principals had agreed at
that time that the only three outstanding
issues remained which were the
appointment of Roy Bennett as deputy minister
of Agriculture and the
unilateral appointments of Attorney-General Johannes
Tomana and Reserve Bank
of Zimbabwe governor Gideon Gono, and they were
going to be resolved in a
month’s time.
However, Mugabe made a U-turn and refused to appoint
governors from the MDC
formations resulting in Tsvangirai taking the matter
to court in November
2010. Mugabe has also refused to swear in Bennett and
in a sign that the
MDC-T had given up on the matter, the party appointed
Seiso Moyo in Bennett’s
place.
The land audit has also not been
conducted, while Tomana and Gono have
remained in office.
In the
election roadmap, negotiators agreed on the need to reconstitute the
Baz,
Zimbabwe Broadcasting Holdings and the Mass Media Trust boards, but
Shamu
has refused to cooperate.
The negotiators failed to agree on security
sector reforms, staffing of ZEC
and the appointment of a three-man Sadc team
to work with Jomic and referred
the matter to the
principals.
The principals have not dealt with the issues
although Mugabe and Zanu PF
have made it clear that there would be no
security sector reforms and
tampering with the ZEC, which the MDC formations
believe is staffed with
state security agents.
Presidential
spokesman George Charamba yesterday said negotiators were
referring petty
issues to the principals, adding that the time for them to
be disbanded had
come.
“Why do they think it’s easier for the principals to agree
where they have
failed?” asked Charamba.“In any case, they are referring
petty issues to the
principals (and) that’s why they have not looked at
them. The principals
know that there is one commander-in-chief of the
Zimbabwe Defence Forces who
is responsible for the security sector.On the
staffing of ZEC and other
commissions, they know that is an issue of the
executive of those
commissions. Those are administrative issues which
principals cannot be
dealing with.”
Mutambara was reportedly
out of the country and could not be reached for
comment.
http://www.theindependent.co.zw/
Thursday, 26 January 2012
17:52
Wongai Zhangazha
THE family of the late retired army
commander, General Solomon Mujuru, is
not convinced that the charred remains
found at his gutted Beatrice
farmhouse were those of the decorated
liberation war hero since the police
had not positively identified the
remains at the time a public announcement
was made.
The general’s
older brother, Joel Mujuru, told the ongoing inquest into the
Zanu PF
luminary’s death in Harare yesterday in an emotional outburst that
he had
reservations about the identity of the remains found at the burnt out
Alamein farmhouse in August last year.
He made the
remarks while cross-examining a Zesa expert, Douglas Nyakungu,
who was based
at Beatrice.
This is the second time during the inquest that the
older Mujuru has
questioned whether authorities were completely certain that
the remains
found at the badly burnt farmhouse were those of his
brother.
On Tuesday Joel asked Assistant Inspector Jokonia Zaza from
Beatrice Police
Station if he was certain at the time he saw the body that
he could identify
it as that of the general. Zaza responded that the body
was badly burnt and
he “could not identify that it belonged to the general
at that time”.
Joel also quizzed Nyakungu who had called the general
on his mobile phone
after the two had separated following a drink at
Beatrice Motel on the
evening of August 15.
“I don’t know whether
it is him or not who was found at the farm,” said a
distressed Joel.
“Anyway, my question is whether the person who had called
earlier; could you
by any chance have been able to establish who he was
talking to for a very
long time?”
This was after Nyakungu had revealed that the general
spoke to a mysterious
caller for about five minutes before they bade
farewell following their
evening drink. Nyakungu said it appeared the phone
conversation the general
had was serious going by his facial expressions and
hand movements.
“I am also very much interested if by any chance the
police or NetOne or
Econet can give this court a phone record as to who
called the general so as
to establish who this person who was being consoled
by the general was and
what they were talking about,” Joel
said.
Nyakungu ruled out that the fire which engulfed the farmhouse
was caused by
an electric fault. Nyakungu said: “I do not know what caused
the fire, but
the investigations that we conducted, Zesa is not responsible
for the fire
that erupted at the general’s farmhouse. It was actually the
fire that
destroyed Zesa cables at the house. No Zesa equipment on the farm
appeared
to have started the fire.”
He said through the guidance
of Chief Superintendent Crispen Makendenge, he
observed that two breakers on
the miniature circuit breaker were switched
off, meaning they had suffered
an electric fault, but others remained on.
“When I arrived at the
farm later to carry out investigations, I discovered
that the pipes covering
the electric wires were burnt to such an extent that
the points where a lamp
holder will be connected were utterly destroyed. All
circuit outlets (single
and double) were destroyed; that’s when we suspected
that theburning had
caused the tripping of (the) breakers,” said Nyakungu.
“I say the
fire had burnt the electrical cables because I observed that the
wiring
contained in the pipes did not have characteristics that showed that
they
had experienced a fault. In the event of an electric fault, pipes would
have
suffered a hole or they would have partially been bruised or burnt.
However,
I observed that pipes that were coming from above had not suffered
any
damages; the same applies to pipes which were on the walls. Therefore,
fire
destroyed the electrical setup in the house,” Nyakungu said.
The
family’s lawyer Takor Kewada told journalists on Wednesday that in the
event
that the Mujuru family was not satisfied with findings of local
experts,
they were at liberty to hire international experts since this wasn’t
a trial
but an inquest.
“This is an inquest; it’s not a trial, so in the
event that we are not
satisfied with local experts we are considering
calling international
experts,”Kewada said.
http://www.theindependent.co.zw/
Thursday, 26 January 2012 17:51
Paidamoyo
Muzulu
NEWLY elected Zanu PF Mashonaland West provincial chairman John
Mafa has set
his sights on claiming the party’s national commissar and
Information
minister Webster Shamu’s Chegutu East seat in the forthcoming
party
primaries.
Mafa’s elevation has opened doors for him and his
backers to challenge
sitting MPs,prominent among them, Local Government
minister Ignatius Chombo
and Zvimba East MP Patrick
Zhuwao.
Mafa’s campaign is backed by former provincial chairman and
flamboyant
businessman Philip Chiyangwa as well as MPs Bright Matonga and
RisipaKapesa,
and the party’s provincial women and youth
leagues.
Mafa beat three other aspirants, Walter Chidhakwa, Reuben
Marumahoko and
John Marashwa, in a contest to decide who would have greater
control in
deciding parliamentary candidates in the divided party
province.
Mafamade a comeback after a two-year hiatus following a
bloodless palace
coup by his provincial committee in 2009.
His
victory brought a ray of hope for Chiyangwa to resurrect his flagging
political career, as well as other party members to challenge sitting MPs
who backed losing candidates in the party’s provincial
polls.
Shamu was backing Marumahoko while Chombo backed
Chidhakwa.
The four-man contest, while at the surface showed some
semblance of
democracy within Zanu PF, had many underlying currents with
politburo
members divided over which candidates to back. The stakes were
high with the
resultant provincial committee having power in selection of
party
parliamentary candidates.
Sources within Zanu PF claimed
that Mafa and the core of his backers were
already strategically positioning
themselves to contest in the next
parliamentary elections.
The
insider said: “Mafa has his eyes on Shamu’s Chegutu East constituency
and
Chiyangwa wants to recapture Chinhoyi. Chombo and Patrick Zhuwao are set
to
battle for their Zvimba seats against Edwin Matibiri and Francis
Mukwangariwa respectively.”
Mafa’s consolidation of power has
also received the backing of two sitting
MPs who are angling to be co-opted
into the provincial committee, the
insider added.
“Bright Matonga
(Ngezi) and Risipa Kapesa (Makonde) who backed Mafa are also
interested in
being co-opted vice-chairman and secretary for administration
respectively,”
the source added.
On Tuesday, Mafa could not confirm or deny his
aspirations to fight for the
Chegutu East seat when reached for
comment.
Mafa said: “I can’t say much about my political ambitions
since I am new to
the office. My first priority is to rebuild organisation
that is in tatters.
There are a number of people interested in being
co-opted into the
provincial executive but that would only be done after the
first meeting of
the new executive is held.”
Shamu has of late been
propping up his profile in Chegutu East by donating
an ambulance to the
constituency and setting up a cooperative called Mai
Grace Mugabe
bakery.
Chombo and Zhuwao insist that they are ready to face anyone
who challenges
them in their constituencies. However, speculation is rife
that Chombo is
planning to switch from Zvimba North to Makonde senatorial
constituency.
Zanu PF Mashonaland West province had been blighted by
factionalism as the
two main factions in the party headed by Emmerson
Mnangagwa and Joice Mujuru
fight to succeed President Robert
Mugabe.
So vicious were the divisions in Mashonaland West that the
provincial
elections were postponed twice.
Zanu PF was forced to have
direct voting by delegates at district level for
the first time as it tried
to control vote buying and rigging.
http://www.theindependent.co.zw/
Thursday, 26 January 2012
17:48
Faith Zaba
THE inquest into former army commander General
Solomon Mujuru’s death
entered its second week at the Magistrate’s Court,
with revelations which
can best be described as nothing else but
explosive.
Mujuru was burnt to ashes under unclear circumstances at his
Alamein Farm in
Beatrice on August 16 2011 and the inquest will try to
determine the origins
of the fire and cause of his death.
The
long-awaited inquest has raised more questions than answers into the
death
of one of Zimbabwe’s most influential politicians. He was one of the
faction
leaders and a kingmaker in Zanu PF. His death was not only robbed
his
faction, but also Zanu PF of the only remaining person who could
challenge
President Robert Mugabe openly and tell him to retire.
The inquest
has unraveled shocking details of the night the national hero
died.
Blue flame
Policemen who retrieved Mujuru’s
remains from his farmhouse told the court
this week that the body was
engulfed in blue flames.
The fire was not easily extinguished and actually
became ferocious when
water was poured on it.
Constable Cletwell
Garisai of Beatrice Police Station and the
officer-in-charge, Inspector
Simon Dube, who attended the scene, graphically
described the hours after
Mujuru’s body was found in his razed farmhouse.
Garisai said Mujuru’s
charred body was engulfed in flames different in
colour from those
surrounding it. The bluish fire covered the body to a
radius of about 30 cm
around the body, which he said was lying face down
with both legs and arms
severely burnt.
The two told the court that the blue flames that
engulfed Mujuru’s body
blue were so intense that when they tried to put them
out with water, they
would re-ignite. They had to pour at least 10 buckets
of water to douse the
flames.
Garisai said: “Some of the people
(who were gathered at the scene)
identified a bluish flame in one of the
rooms and I peeped through a window
and saw an object which resembled a
human body with …arms folded as if to
cover the face, as it lay prostrate on
the floor.”
“The bluish flame emanated from the body, suffice to say
the colour of the
other surrounding flames was different from that around
the area of the
body. And the flame was emanating from the remains of the
body and also 30
cm around the body and there was smoke coming from the
abdomen.”
Dube said: “Lungs and intestines were burnt extensively and the
head was now
just a skull.” He also stated that he had seen “strange blue
flames” coming
from the general’s abdomen.
Fire Brigade
testimony
Station Officer for Harare Fire Brigade Clever Mafoti said
indications were
that the fire could have emanated from two sources, a
phenomenon usually
associated with cases of arson. In rare cases, the fire
may be as a result
of a short circuit.
After being asked whether
it was possible to have two sources of fire,
Mafoti said: “It is possible if
it’s in cases involving arson when the fire
has been started by a person
with an unsound mind or in a situation where a
short circuit of electricity
would have occurred. This short circuit can
happen where a number of
electrical gadgets would have been overloaded at
one point.”
The
key factor
Mujuru’s maid Rosemary Short revealed last week that the
key to the front
door of the farmhouse was missing from the bunch of keys
found in the
bedroom. That was the same bunch of keys the General said he
had left in
Harare. In addition to the missing key, Mujuru’s car was parked
near the
front door, whose very key was missing. Short said this was an
unusual,
given that she had given him the key to the kitchen door. Short
also said
the car keys were still
missing.
Gunshots
Short confirmed she heard what sounded
like gunfire before she was alerted
by a policeman, Constable Obert Mark, to
the fire that killed Mujuru.
She said she heard three gunshot sounds prior to
Mark’s arrival at her house
at 2:45 am. However, upon quizzing Mark about
the gunshots, he told her that
the sound she heard was that of asbestos
sheets bursting.
This corroborated testimony by another witness who
testified last week, a
security guard, Clemence Runhare, who worked at the
farm also claimed that
he heard two gunshot like sounds two hours before he
was alerted to the
fire.
Questions
The question which
many Zimbabweans are now asking is why the fire on Mujuru’s
body was blue
and different from surrounding flames.
The forensic and fire experts
should tell the court when they testify what
produced the blue flame and
under what temperatures such fire is produced.
Can a mere candle, as was
initially claimed by the police, produce different
colours of the
flames?
Here are some of the questions that beg answers from the fire
and forensic
experts.
Does a burning human body naturally produce
a blue flame was and why was
this concentrated on Mujuru’s body and area
surrounding it?
Under what circumstances would this
happen?
What types of chemicals produce blue fire?
How
long does it take for a body to burn to an extent where its left arm is
burnt to ashes up to elbow level, both lower limbs burn to ashes up to knee
level and most internal organs severely burn and some in cases, are
absent?
How long would it take for the fire to burn a body to
that level and at what
temperatures?
There are too many
pieces that need piecing. So what happened that night?
INQUEST
TIMELINE. . .
Day 1
Clemence Runhare (security
guard)
Gen Mujuru arrives at the farm at 8.00pm
He was in the company of
an unidentified male partner
General not drunk
At midnight I heard
gunshots
Augustine Chinyoka (Police officer)
Gen Mujuru was alone and
appeared drunk
He had a suit at the backseat
At 2.00am I saw the
fire
Had patrolled three times
Fire brigade arrived at 5am after I had
phoned them at 2am
Obert Mark (Police officer)
Was in cottage at
11.00am
Mujuru was drunk because he stammered as he spoke and had bloodshot
eyes
Mujuru went to sleep at 9pm, the same time as Hamandikari
Day
2
Inquest halted
Day 3
Rosemary Short breaks
down in court while giving an account of her reaction
on hearing that the
farmhouse was on fire
She tells the inquest that the candle in Mujuru’s
bedroom was about 7cm long
and was properly secured in a
saucer.
Vice-President Mujuru reveals that her husband’s vehicle had been
suspiciously parked the day he died
Day 4
Rosemary
Short (housemaid)
Tells the court that General Mujuru did not trust police
guards and had
considered replacing them
Relationship between Mujuru and
the police had deteriorated after police
severely assaulted a
farmworker
Says Obert Mark told her the noise which she thought were gun
shots was
caused by bursting asbestos
She says Mujuru’s car keys were
never recovered
The bedroom keys which Mujuru had said he forgot in Harare
were found in his
bedroom
Mujuru looked sober though it showed he had had
a few drinks
She said she heard what sounded like gunshots but had thought it
was normal
as police had previously told her they fire shots to scare
intruders or kill
snakes
Day 5
Tawanda Madondo
(gardener)
Told the court he was summoned by police officer at 02:20 am to go
and show
him the General’s bedroom
They took 30 minutes to get to the
scene and several buckets of water poured
on body to extinguish
flames
Saw the general’s body through the window and it had been
burnt
Day 6
Steven Harinyeni (clerk)
Concurred with
Madondo and added that body was still on fire when he saw it
Mujuru family
lawyer Thakor Kewada queried why police wasted time by running
three
kilometres to compound to ask workers to show them general’s bedroom
instead
of breaking windows and try and find the general
Day
7
Cletwell Garisai (Police)
Tells court he retrieved the charred
remains of General Mujuru from his
farmhouse
Disclosed that there was a
gaping hole in the general’s abdomen
Also said the body was engulfed in
bluish flames that were different in
colour from the surrounding
flames
Said the blue flames were so intense that they would re-ignite when
water
was poured on them
They poured at least 10 buckets of water to
finally douse the flames
Flames came from body and the 30cm area around the
body
Smoke was coming from the abdomen
Together with constables identified
as Manokore, Gonti and Mhundwa, they
were tasked by Deputy
Commissioner-General Godwin Matanga to remove the
General’s remains and put
them in a plastic bag
Simon Dube (Inspector) concurred with Garisai and added
that legs were burnt
up to the ankles
Arms also burnt to area just before
the wrists
Instructed to gather all debris that included hard objects and
ashes which
were taken to One Commando Barracks
Cordoned off the area
after the arrival of VP Mujuru, Commander Perance
Shiri, Minister Kembo
Mohadi and David Parirenyatwa, who all viewed the
charred body
Only the
chest had bits of flesh
At One Commando mortuary, Doctor Annamore Jamu
certified that the remains
were those of a human being
Beatrice Police
Station did not have transport from March to August 16 2011
and police were
forced to ask for assistance from a neighbouring farm
Mujuru family lawyer,
Thakor Kewada said it was unlikely the police guards
would have phoned to
report the fire
http://www.theindependent.co.zw/
Thursday, 26 January 2012
17:46
RESERVE Bank governor Gideon Gono is to be the star witness in an
alleged
fraud case in which Prime Minister Morgan Tsvangirai and his close
relative
Hebson Makuvise are accused of misappropriating US$1,5 million in
public
funds meant to buy a residence for the premier in the Harare
up-market
suburb of Highlands.
The Zimbabwe Independent is reliably
informed that the docket was now with
the presidency and police
commissioner-general Augustine Chihuri was
awaiting the go-ahead to arrest
Tsvangirai.
Cabinet ministers and senior government officials are
usually arrested only
after President Robert Mugabe has
consented.
High-level sources in the police and government told the
Independent this
week that investigations were completed late last
year.
Criminal Investigations Department (CID) chief superintendent Alison
Nyamupaguma is leading the investigations team into Tsvangirai’s alleged
fraud case.
One senior police officer said: “The docket is ready
and it has been handed
over somewhere. I cannot say who currently has it,
but the people are quite
high up. We have all the documents, including
documents from the president
authorising Gono to give the prime minister the
money. We also have
documents, which include bank statements, where the
money was first
deposited and all the banks to where the money was
transferred up to the
last transaction. In this case, Gono will be the key
witness for the
prosecution if we are given a go-ahead to arrest. But I
believe the decision
not to arrest is political because we were very
thorough in our
investigations.”
However, police spokesperson
senior assistant commissioner Wayne Bvudzijena
declined to comment.
“We
are not commenting on the matter for now,” he said.
Information
obtained by the Independent shows that there were two different
sums of
money released from Treasury and the central bank to buy the same
property
located at No 49 Kew Drive in Highlands.
An amount of US$1,5 million
given to Tsvangirai was allegedly siphoned off
by Tsvangirai and Makuvise,
who is Zimbabwe’s ambassador to Germany.
Details showed that Finance minister
Tendai Biti set aside US$1 million for
the house in his 2010 national budget
presented in November 2009.
The money from Treasury was used to buy
and renovate the property, and this
has been confirmed by officials at the
exchequer.
At the same time, Tsvangirai was given US$1,5 million by the
government
through the central bank, after Mugabe had approved a request
from
Tsvangirai to buy a residence for him on November 13
2009.
This was after Tsvangirai’s failure to move into State House or
Zimbabwe
House after apparently being blocked by Mugabe.
Biti was unaware
of the money from the RBZ since Tsvangirai
had arranged that funding
separately.
Senior government officials said Mugabe might not act on
the matter because
of the political implications of arresting his fiercest
challenger while the
country was preparing for elections pencilled in for
either later this year
or 2013.
“I don’t think Tsvangirai will be
arrested,” said one senior official. “The
timing wouldn’t be right because
of elections. It will be misconstrued as
political persecution. This is the
dilemma we are in now — do we just ignore
the matter when evidence shows
that public funds were misappropriated or do
we just ignore because it will
be tantamount to political suicide.”
However, law enforcement agents
and the securocrats are pushing for
Tsvangirai’s arrest, while Zanu PF
politburo members believe that the arrest
would not serve the party
well.
Bank statements show Makuvise, who lived at 3 Everette Close,
Avondale,
Harare, was the one who withdrew most of the US$1,5 million. He
made a
series of withdrawals until the funds were exhausted as the money was
transferred from one bank to another after it was released from the RBZ
coffers in November 2009.
Four commercial banks, CBZ, ZB, BancABC
and Interfin Banking Corporation
handled the US$1,5 million. — Staff Writer.
http://www.theindependent.co.zw/
Thursday, 26 January 2012 17:25
Faith
Zaba
ZIMBABWE Revenue Authority (Zimra) Commissioner-General Gershom Pasi
has
been reduced to a lame duck after the Finance ministry stripped him of
all
powers in a move likely to widen the rift between President Robert
Mugabe
and Finance minister Tendai Biti.
Mugabe and Biti are deeply
divided over Pasi’s fate after his contract
expired in October 2011. Pasi
should now vacate his office at the end of
this month unless the board
decides otherwise.
Pasi was among three people interviewed for the
coveted post out of 53
applicants on December 14 2011 and the Zimbabwe
Independent is reliably
informed that he scored high.
However,
alleged political machinations not to re-appoint Pasi are at play
and there
is talk of re-advertising the post and conducting fresh
interviews.
The
short-listing and interviews were conducted by CV People Human Resources
Consultants together with three board committee members.
A
letter written to Pasi by acting secretary for finance Pfungwa Kunaka,
dated
January 18 2012 reads: “Considering (the) status of your employment
contract
which has expired, it is inappropriate that in any of your
correspondence on
Zimra matters, you continue to sign off as the
commissioner-general. In any
event, the above has legal implications. I,
therefore, advise that for
purposes of correspondence and business
transactions, it is most appropriate
that these be signed on behalf of the
Zimbabwe Revenue Authority by Zimra
staff. Please also observe that the
above applies with respect to travel
outside the country. The ministry is
not in a position to overlook the
status of the employment contract.”
The letter was copied to Biti,
secretary for finance Willard Manungo and
Zimra board chairperson Sternford
Moyo.
Moyo told the Independent on Wednesday that matters of
employees’ contracts
were confidential and could not be discussed with the
media without Pasi’s
consent and board approval.
“As I indicated
that you know contracts are generally treated as
confidential and to discuss
the nature of anyone’s contract will be a
violation of the employee’s rights
and a violation of confidentiality,” Moyo
said.
Pasi declined to
comment and referred all questions to the Zimra corporate
communications
team.
“I cannot comment on that issue. Please talk to the corporate
communications
team,” said Pasi, who has been at the helm of Zimra since
2001 after the
amalgamation of the old Department of Taxes and the
Department of Customs
and Excise.
Biti told the Independent a
fortnight ago that Pasi’s contract had expired
and “after a contract
expires, you call for an interview and the best man
gets the job”.
Senior
government sources said Mugabe wanted Pasi to remain Zimra boss while
Biti
was opposed to his re-appointment. The sources said the board was also
divided over the matter.
According to the Revenue Act, the
appointment of the commissioner-general
should be done by the board and it
is only when the person is not a
Zimbabwean citizen or is not resident in
Zimbabwe that the minister has to
approve the
appointment.
Section 19 (1) states: “The Board shall appoint, on such
terms and
conditions as the board may fix, a person to be
commissioner-general of the
Zimbabwe Revenue Authority.”
Section
19(2) states: “Without the authority of the minister, no person
shall be
appointed as commissioner-general and no person shall qualify to
hold office
as commissioner-general if he is not a citizen of Zimbabwe or
ordinarily
resident in Zimbabwe.”
Relations between Biti and Pasi deteriorated
after the latter reportedly
refused to take orders from the treasury
boss.
According to the Revenue Act, the commissioner-general reports
to the board,
although the minister may from time to time direct the board
to furnish him
with such information and statistics as the minister may
require in regard
to revenues, the activities, funds and property of the
authority.
The Act also stipulates that the minister may give the
board directions on
matters of policy, which the authority is to observe in
the exercise of
functions the minister considers being requisite in the
national interest.
Section 19 (4) states: “The commissioner-general
shall be responsible,
subject to the board’s control for supervising and
managing the authority’s
staff, activities, funds and property and
performing such other functions as
the board may assign to him or as may be
conferred or imposed on him by or
under this act or any enactments.”
http://www.theindependent.co.zw/
Thursday, 26 January 2012 17:23
Owen
Gagare
THE government could have unjustifiably forked out millions of
dollars as
sitting allowances to undeserving legislators who each earned a
flat fee of
US$15 000 as it has emerged that a number of legislators rarely
attend
parliament.
The country has 244 serving legislators, meaning more
than US$3,6 million
was spent on the allowances.
Legislators said
some of their colleagues rarely attended parliamentary
sessions or committee
meetings and therefore deserved far less, an
allegation confirmed by party
chief whips.
“We have some super MPs who only attend sessions when
there are crucial
debates. Some of the MPs only show their face about once
or twice a month
and clearly, they don’t deserve US$15 000,” said an MP who
spoke on
condition of anonymity.
The blanket flat fee was against
the agreed position where MPs were to get
US$75 for every
sitting.
Zanu PF chief whip Joram Gumbo confirmed that if MPs were to
get US$75 per
sitting, some would have taken home as little as US$1
000.
“We have been pushing for MPs to be given their sitting
allowances, which is
not a favour, but their right. We had agreed that the
rate would be US$75
per sitting, whether it’s in parliament or in
committees, so basically each
member was to be paid according to the number
of sittings,” said Gumbo.
“To the best of my knowledge, parliament is
still working on consolidating
those figures so that they determine the
amount each MP is entitled to. I
don’t know how the blanket payment came
about, but what I know is that
parliament was supposed to consolidate
figures and send them to Treasury for
the MPs to be paid. If the MPs were to
be paid according to attendance some
would have got around US$1 000,
especially those who became ministers, and
those who were not attending
sessions,” Gumbo said.
MDC chief whip Edward Mkhosi said he was
pleased that MPs finally got paid
their allowances after years of waiting.
He, however, said some MPs could be
asked to repay the money if they were
found to have not been attending
parliamentary business.
“They
were paid a flat sum, although we had agreed that the payment would be
based
on the number of sittings. I’m being told that those who deserve more
will
get additional allowances while those who got more than they deserve
may pay
back,” said Mkhosi.
The chairperson of the inter-party welfare
committee, Paddy Zhanda, said
legislators who were going around complaining
about the allowances given to
their undeserving colleagues were being
selfish.
“They are being selfish. They should look at their pockets
instead of what
is in another person’s pocket,” Zhanda
said.
Clerk of Parliament Austin Zvoma said parliament had nothing to
do with the
payments and said they could have come directly from Treasury or
the
Ministry of Constitutional and Parliamentary Affairs.
Zvoma
said his staff was still compiling records to determine the amounts
the MPs
were supposed to receive.
Constitutional and Parliamentary Affairs
minister Eric Matinenga said he had
heard concerns from some legislators,
but said the US$15 000 was only a
working figure.
Matinenga said
the concerns were genuine and his ministry would confirm the
actual figures
owed to each legislator before topping up the difference for
legislators who
deserve more and asking those who received more than they
deserved to pay
back the difference.
Legislators had not been given their sitting
allowances since the inception
of the seventh parliament in
2008.
They had threatened not to approve the 2012 budget presented by
Finance
minister Tendai Biti in November last year in an effort to arm-twist
the
government to pay them.
http://www.theindependent.co.zw/
Thursday, 26 January 2012
17:15
WITH civil servants on strike over pay and working conditions,
Zimbabwe
Independent reporter Elias Mambo (EM) spoke to Finance minister
Tendai Biti
(TB) in the capital on Tuesday about issues concerning civil
servants,
Copac, the GPA and elections. EM: First and foremost, concerning
the civil
servants’ industrial action, President Robert Mugabe has accused
you as
Finance minister of sabotaging the government by refusing to pay
civil
servants well.
TB: That’s not true, when did he say that?
There is no need for politicising
the whole issue. The fact is the country
is in a difficult fiscal position
and I made it very clear in the 2012
budget which I presented on November 26
that 67% of resources are going
towards wages. We have to balance between
wage demands and other obligations
such as education, agriculture, health
and social welfare.
This
economy has been ravaged by 31 years of financial (and) economic
mismanagement and cannot be turned around in 20 months. That is why it is
important to have a social dialogue so that every party in Zimbabwe accepts
and appreciates our difficult fiscal position.
EM: In other
words, you are saying there is no money to pay civil servants.
How about
using revenue from the sale of diamonds?
TB: The issue of diamonds
has to be dealt with as a matter of urgency. In
2011 we only got less than
US$80 million and that is not good enough given
our current
situation.
EM: Is it not that a lot of money is being wasted on
paying the 75 000 ghost
workers?
TB: The (civil servants) audit
meant to weed out ghost workers was completed
last year, but the report has
been blocked by cabinet.
EM: On the diamonds issue, we understand you
wrote a letter to the United
States government castigating it on the
sanctions imposed on Marange
Resources and Mbada Diamonds.
TB:
That’s not true. Which newspaper produced that letter? You should have
brought that newspaper. I am not going to answer on that issue, we do not
comment on hearsay. Do not generalise issues. These are uncontested facts. I
am a lawyer and I cannot use my comment to legitimise facts that are
wrong.
EM: On the Sadc election roadmap, it seems everything is
quiet. There is no
implementation of reforms and the principals in the
inclusive government are
also quiet. What is the position?
TB:
You are right. The democratic reform agenda has gone into the intensive
care
unit. It requires massive surgery and curative, as opposed to
palliative,
solutions. The government of national unity has failed to
implement agreed
positions. About 50% of the agreed reforms have never been
implemented. At
the Maputo Sadc troika summit of November 5 2009, we agreed
on 24 issues out
of 29 issues and none of the issues were implemented. That’s
a disaster.
These issues include media reform, electoral reforms.
Where we have
an arrested development then we have a reversal of all the
gains of the
inclusive government. What is needed is for the parties
involved to restart
with energy the engagement process. Sadc should
re-energise the dialogue
process and it should include implementation of
agreed issues such as
appointing a three-person committee to work with
Jomic. If we don’t do that,
then we are heading for disaster.
We are heading for a catastrophic
point of no return and this means the next
election will be critical. The
next election will be imperative. It will be
as important as the 1980
election. It’s either we end the crisis or prolong
it. I do not want to
prolong it and the people of Zimbabwe do not want to
prolong it.
EM: How
then are we going to stop this crisis given the fact that the
constitution
process seems to have failed. What will happen next?
TB: I have no
doubt that we will have a constitution before the end of 2012.
Yes, the
process has been slow and difficult; the process has been hijacked
by
partisan interests and arrested by Zanu PF’s incompetence and
intransigence, but it will limp along, that I can assure you. It will limp
along to a constitution and a referendum. What I can assure you is that
there will be a constitution by the end of the year.
EM: Given
that the constitution issue is done, but electoral, media and
security
reforms remain a thorn in the flesh — elections or no elections?
TB:
That’s an absolute no. No elections without the implementation of the
agreed
reforms. After the constitution, we must have a referendum so that
the
people of Zimbabwe may be given an opportunity to accept or reject it.
There
is also the issue of the delimitation of boundaries, agreement on
security
sector reforms, media reforms and electoral reforms. We also need
to prepare
a brand new voters roll. We have a lot of things that need to be
done given
our history of indifference. It is impossible to complete
everything before
the end of 2012.
http://www.theindependent.co.zw/
Thursday, 26 January 2012 16:11
Paul
Nyakazeya
PRELIMINARY assessments by the Zimbabwe Farmers Union (ZFU)
show that the
area planted for major crops diminished this agricultural
season owing to a
poor start to the season and inadequate
inputs.
Without giving the hectarage, ZFU said in its weekly market
guide the area
planted for major crops such as maize, wheat and soya bean
had diminished
this year compared to the previous year.
“The area
planted to major crops has been reduced compared to last year
because of the
poor start to the season and inadequate inputs,” said ZFU.
According to
Agricultural Extension Services (Agritex), Zimbabwe planted 247
000 hectares
of maize from November to January, down from 379 993 hectares
in the same
period last year because of late rains.
Farmers planted 130 944
hectares of sorghum and other small grains, compared
with 136 131 hectares,
Agritex said.
Cotton planting also decreased from last season. A
total of 45 000 hectares
were planted compared to 107 727 hectares last
season. “The early planted
cotton is at ball formation but was mostly
affected by poor germination and
lack of seed for replanting. Some of the
crop in the Zambezi Valley has just
been planted and is at germination
stage. The crop condition is ranging from
fair to good,” said
ZFU.
Farmers planted soybeans on 5,079 hectares compared to 13 674
hectares, and
tobacco on 39 393 hectares compared to 43 545 hectares to last
season.
ZFU said maize crops vary from tasselling stage, with some
farmers in the
Zambezi Valley said to be planting.
“The condition
of the crops is generally fair, with signs of nitrogen
deficiency in some
crops. Those farmers who are still planting are being
discouraged from doing
so but are advised to try short season crops like
sugar beans,” ZFU
said.
ZFU said early irrigated tobacco crop was being reaped while
the dry or late
planted crop was still at vegetative stage.
In
response to problems associated with high demand for tobacco packaging
materials and their non-proximity to the farmer, ZFU said in agreement with
Propak, it was now selling materials from its provincial and district
offices.
According to the Tobacco Industry Marketing Board,
preparations for this
year’s tobacco season, which starts on February 16,
are almost complete at
the four floors licensed to handle tobacco sales this
year.
The floors include Tobacco Sales Floor, Boka Tobacco Auction
Floors,
Millennium Tobacco Floors and a new player, Premier Tobacco Auction
Floors.
The farmers’ union noted that the current farming season was
characterised
by late, poorly distributed rainfall. It said the first rains
where very
patchy and ineffective, affecting the germination of the early
crops, giving
a false start to most farmers who had to come up with
gap-filling or totally
replanting the failed crops.
“The
prolonged dry spell (following planting) then affected the crop which
suffered from temporary wilting because of intense heat. The latest rainfall
has come as a relief to most areas,” said ZFU adding that said in some areas
it had not been as heavy and widespread.
Farmers hoped the wet spell
would continue.
http://www.theindependent.co.zw/
Thursday, 26 January 2012 16:02
Paul
Nyakazeya
THE absence of the Reserve Bank of Zimbabwe’s role as the
lender of last
resort (LOLR) has resulted in the financial sector failing to
consolidate
stability attained when the country was dollarised in 2009,
analysts said.
Following the adoption of the multi-currency system, the
Reserve Bank’s LOLR
function was rendered non-operational as the central
bank had no capacity to
provide funding to banks facing liquidity
challenges. Universally this is
not ideal for the stability of the financial
system.
According to the RBZ, international best practice requires
that the LOLR
pool in a dollarised economy should constitute between 50% and
150% of
banking sector’s capitalisation or 5% to 15% of the banking sector’s
deposits.
Addressing the business community in Harare recently,
RBZ governor Gideon
Gono said the central bank’s view was that a LOLR fund
based on a proportion
of the deposit base had a better relationship to
potential liquidity
developments on the market.
Gono said the
establishment of an effective lender of last resort function
following the
US$100 million LOLR fund announced by the Finance minister
Tendai Biti in
his 2012 budget statement would undoubtedly restore “some
confidence” in the
banking sector, and spur economic activity. However, the
Finance minister
has only provided US$7 million of that amount.
“The banking sector
has largely mobilised short-term deposits, which are
transitory and volatile
in nature, mainly driven by salary payments,” said
Gono.
“The short-term
nature of (these) deposits has hindered effective financial
intermediation
to the productive sectors as lending is restricted to
short-term
periods.”
Economics lecturer Prof Tony Hawkins said inherent risks
deeply embedded
within the economy made it imperative for government to
ensure that the
Reserve Bank resumes the LOLR responsibilities in order to
consolidate the
sector’s stability, including the attained economic
growth.
“It is of paramount importance for government to ensure that
the banking
sector is capacitated to effectively harness savings, which are
critical as
a solid foundation for attaining meaningful economic growth,” he
said.
He said measures to enhance the ability of the sector to
advance meaningful
credit to the undercapitalised economy were also
fundamental.
Hawkins suggested that “visibly mediocre performance of
the economy so far”
could largely be attributed to absence of functional
policies that are aimed
at empowering the financial sector to be the focal
point of solid economic
rejuvenation.
“Restoration of confidence
in the financial sector will remain futile if the
Reserve Bank remains
dysfunctional when it comes to providing liquidity in
the financial sector
during periods of temporary liquidity strain,” Hawkins
said.
Since dollarisation liquidity has been further constrained
by limited
activity on the inter-bank market due to lack of acceptable money
market
instruments.
According to Gono, the available bankers’ acceptances
have been shunned due
to their inherent credit risk. As such, all banks
were working in silos,
meaning that banks with excess liquidity were not
assisting those in
deficit. This had led, among other issues, to selective
non-processing of
customer payments by banking institutions with liquidity
challenges.
The prevailing low salaries in the economy have resulted
in most
transactions being cash-based, militating against the intermediary
role of
banking institutions. Some banking institutions are said to have now
resorted to selling cash at a premium to those institutions with inadequate
hard cash resources.
The stringent conditions precedent to
accessing foreign lines of credit have
negatively affected the liquidity
situation of the banking sector and the
economy at
large.
Confederation of Zimbabwe Industries president Joseph
Kanyekanye said as
much as Zimbabwe’s macroeconomic challenges were unique
to those in the
developed and emerging economies, the government must
prioritise policies
that ensure that the intermediary role of the banking
sector is fully
restored.
“Ensuring that the Reserve Bank resumes
lender of last resort function is
essential not only for the much needed
stability of the financial sector,”
he said.
He said the subdued growth
in the deposit base currently, including the slow
rate of credit expansion
in the economy, could be partly attributed to the
absence of a lender of
last resort in the financial sector.
During the first nine months of
2011, the Reserve Bank said its External
Loans Co-ordinating Committee
(ELCC) approved short-term trade finance
facilities amounting to US$2,6
billion, while utilisation was only US$922,7
million or
36,1%.
“Persistent bank-level liquidity challenges may result in some
banks failing
to honour their obligations, leading to heightened systemic
risk,” said
Gono.
He said short-term lending had the potential to
create asset quality
vulnerabilities due to mismatches between short-term
funding and the credit
requirements of medium to long-term projects. An
illiquid market also
increases the cost of credit and heightens default
probabilities among
borrowers.
Analysts said the majority of
banks in Zimbabwe were likely to report
reduced profits in the year to
December 31 2011, after it emerged that some
banks were sitting on huge bad
debts.
Companies will start publishing financial statements in March
and figures
are likely to reflect the negative effects of their huge loan
books.
Banks experienced increased credit and liquidity risk since
dollarisation,
resulting in high levels of non-performing loans both for
individuals and
corporates.
Increasing non-performing loans
remains the biggest threat to the banking
sector, given that they are
depositors’ funds.
Economist John Robertson said the Reserve Bank’s inability
to intervene in
the banking sector through liquidity support has heightened
systemic risk in
the financial sector.
“This has made it
difficult for the banking sector to mobilise offshore
funding that is
necessary to improve the deposit base. Despite the
prevailing high yields
for interest bearing assets on the economy relative
to those existing in the
sub region and international markets, the economy
remains desperate for
funding,” said Robertson.
He said foreign portfolio capital continued
to avoid the Zimbabwean market,
whose systemic risk was extreme due to the
Reserve Bank’s inactive role as
lender of last
resort.
“Meaningful credit creation in the banking sector to support
various
economic sectors cannot occur where the central bank is unable to
provide a
liquidity safety net required when default risk rises due to
temporary
liquidity complications,” he said.
Economist Daniel
Ndlela said reviving the central bank’s lender of last
resort function will
unlock funding into the economy from the financial
sector which has
maintained high liquid ratios since the introduction of the
multi-currency
environment.
“The inter-bank market, which has been ineffective due
to the non
availability of the lender of last resort, plays a critical role
in the
distribution of credit across the entire economy,” he
said.
Ndlela suggested that non participation of major banks on the
interbank
market had resulted in the economy missing the benefits of having
a
functional interbank market in place.
http://www.theindependent.co.zw/
Thursday, 26 January 2012
16:51
By Eddie Cross
IN THE pre-colonial era of African culture,
both in respect of those tribes
that cultivated and those that were nomadic
in character or even the Nguni
tribes that pursued a militaristic form of
life and culture, all regarded
land as God-given and a common good. Usage
determined title and could be
usurped at any time by force of arms or tribal
consensus. Life was insecure,
short and pretty torrid.
Because these
widely spread communities were basically using the land until
it was
exhausted or grazing was finished, they seldom built permanent
accommodation
–– nomads living in tents and the cultivators living in huts
that could be
simply abandoned when it became necessary to move on. Once
abandoned, the
land recovered in its own time. A similar situation existed
in pre-colonial
America and in Australia.
So long as the population remained very
small in relation to the vast areas
occupied this was a stable and
reasonable life that was reflected in the
culture and norms of the people.
It was also environmentally sustainable.
Then comes the colonial era
which introduced colonial forms of title rights
for settler interests, the
restriction of people to prescribed land areas
and the erection of fences to
limit access and establish control. At the
same time, tribal conflicts were
halted, life expectancies raised and in the
absence of conflict and the
control of disease, African populations began to
grow at a rate not seen for
centuries. In Zimbabwe the population was
expanding at over 3,5% per annum
by the 1950s and remained at this very high
level until Independence in
1980.
This created pressure on land resources, but so long as there
were adequate
stocks of vacant state-controlled land, that could be
allocated and settled
to accommodate the growing population. There was a
need for security for
migrant workers and their families and to make
provision for the exhaustion
of land now being occupied on a permanent
basis. This was satisfied by
simply bringing more land into play. In the
1960s I was involved in just
such an exercise when the Rhodesian government
opened up the Zhombe/Gokwe
area (some 10 million acres of land) for tribal
or communal occupation.
This was the situation in almost all colonial
states in Africa and once the
colonial regime had been overthrown or
withdrawn, the new African
governments, one after the other, chose to revert
to different forms of
tribal and communal systems of land use. In some
countries like Kenya, the
transition was reasonably managed, in others it
was done by the simple
abolition of colonial title rights.
This
post-colonial process over the past 50 years, culminated in the “fast
track”
land reform programme of the Zanu PF regime that governed Zimbabwe
for 28
years up to the formation of the Transitional Government with the MDC
in
2008. Here, as in most other African states the colonial imposition of
title
rights, underwritten by the constitution were simply swept
aside.
South Africa remains the only country in Africa with
widespread title rights
covering a significant majority of the land surface.
What are the
implications of this development for modern
Africa?
Despite the collapse of many economies in the past colonial
era and despite
poor social services delivery in most countries and human
migration to more
developed countries, the population of Africa has
continued to grow. Urban
populations still, on average, constitute half of
total population and
social security systems (pensions, urban freehold
housing, secure private
assets) are in embryonic form in most countries
leaving urban workers and
dwellers with rural land rights established
through tribal linkages, as the
only security for old age, ill health or
unemployment.
The result is that rural agricultural and grazing land
has become a vast
retirement and social security safety net for hundreds of
millions of
people, even those living in the Diaspora often claim such
rights as are due
to them under tribal law.
Then there is the
fact that if such rights are exercised within the
framework of a consensual
tribal culture, such land owners only have
security in so far as they occupy
and use the land in question. So, for
example, you have the spectacle that
each year people plough vast areas in
the vicinity of their rural homesteads
just to maintain their traditional
land usage and occupation
rights.
Such rights cannot be expressed in law or in writing and
certainly cannot be
sold or used as collateral.
Such a system
is reinforced in dictatorial tribal or country systems by
leaders who
recognise immediately the leverage that such systems give those
with the
tertiary rights to control land allocations.
The first result of this
situation is that Africa is witnessing the fastest
destruction of its
fragile environment in the history of mankind. The
deserts of Africa are all
expanding –– some by kilometres every year. Much
of North Africa that is
today sand and stone desert was at one time
productive savannah. It is
within recorded history, that the Sahara Desert
was at one stage, the
granary of the Mediterranean region.
The second is that those who
depend on the land for a living are almost
universally among the poorest
people on earth.
They constitute a disproportionate share of the
absolute poor, living on
less than US$2 a day. Agricultural systems based on
such traditional land
title rights are always subsistence –– barely able to
meet the needs of the
immediate community let alone provide for urban
markets.
Money transfers tend to be towards such communities rather
than from them ––
absorbing savings and creating societies that cannot
generate the capital
resources to develop their countries on their
own.
The third consequence is that the African economy is denied the
inherent
capital value of land and its ability to collateralise the rest of
the
economy through the operation of land markets. In Zimbabwe for example,
the
GDP stands today at about US$10 billion. The national debt nearly the
same
value while the currency in circulation is perhaps US$4 billion.
Compare
this to the theoretical value of urban assets at about US$5 billion
and of
rural farm land of at least US$20 billion.
The fourth
dimension of this situation lies in the simple fact that people
do not
invest in assets that they do not own or control.
Communal land
rights are universally characterised by poor development and
maintenance.
Who is going to invest in infrastructure on land they do not
own? Who is
going to try and improve the fertility of land that they might
lose control
of next year? Such issues are universal in character.
Land is
Africa’s greatest asset and yet it remains a dead asset under
present
arrangements; barely able to sustain itself both economically and
ecologically. This critical issue is brought to the fore by two things ––
our inability to reduce the high proportion of our population in absolute
poverty and associated human degradation and our inability to control and
reverse land gradation.
Any good pasture scientist will tell you
that once land has become desert,
it is almost impossible to reverse the
process.
Yes you can plant trees across the Sahel, yes you can remove
people from
vast swathes of country and relocate them to land that can
support them for
a while, but so long as there is no ownership, backed by
legal, negotiable
title rights, land will continue to degrade, irrespective
of where it is.
In many respects this is Africa’s greatest challenge
and until its leaders
come to grips with it and take the required steps to
grant their own people
basic secure title rights to the land they use to
make their living, there
cannot be any real long-term development either of
African economies or
African democracies and freedoms.
Cross
is MDC-T MP for Bulawayo South.
http://www.theindependent.co.zw/
Thursday, 26 January 2012
16:41
IT WAS announced last week that, as a precursor to its final
liquidation,
Air Zimbabwe had been placed under judicial management.
However, judicial
management is not always a step towards liquidation.It is
beyond doubt that
if a monetarily-troubled enterprise cannot be revitalised
and restored to
viability, it is immediately placed into
liquidation.
Where this is not the case, the courts will (upon appropriate
application
and indications that the relevant entity can be successfully
rescued,
settling its debts and resuming operations) grant an order for that
entity
to be placed under judicial management. When that occurs, a judicial
manager is charged with assumption of management control of the enterprise,
with ascertaining that all of its debts can be discharged (albeit usually
over a period of time), and that it can realistically be foreshadowed that
the entity’s operations can be continued or resumed effectively and
profitably.
Therefore, those that have assumed that Air
Zimbabwe’s being placed under
judicial management is the first legalistic
phase towards it being wound up
and it ceasing to exist, do so erroneously.
Nevertheless, it is not beyond
the bounds of possibility that the judicial
manager could well come to that
conclusion, and upon doing so seek the
necessary court order to bring
liquidation into effect. Meantime, the two
key questions are whether or not
Air Zimbabwe can be saved, and if it should
be saved?
The answer is a categorical yes! Given the right
authorisations by
government and by creditors, there are realistic prospects
of real recovery
for the airline, and very considerable grounds to justify
seeking such
recovery.
The need or desirability for Air Zimbabwe
to continue to exist, to resume,
and hopefully to engage in operations
markedly greater than previously, is
great. Notwithstanding that there are
several regional and international
airlines which provide services into and
out of Zimbabwe, there is a
grievous inadequacy of such services, compounded
greatly by there being
almost no substantive domestic air services.
Moreover, since the
discontinuance of Air Zimbabwe’s regional and
international services, other
airlines have exploited the diminution of
competition by massively
increasing their airfares.
The
insufficiency of services, with near total absence thereof on various
routes, and the considerably increased costs of those services that do
exist, are major constraints upon the growth and development of Zimbabwe’s
very immense tourism potential. That inadequacy of flight availability is
also a substantial hindrance to the business sector, forcing the business
community to resort to very time-consuming road transport for essential
domestic and regional travel, and to some extent also delaying inward and
outward movement of goods, receipt or delivery of which is often
time-critical.
Despite the virtually indisputable need for a
restoration of the services
that were provided by Air Zimbabwe, and for such
services to be markedly
extended, (which evidences that Air Zimbabwe should
be saved and especially
so in the absence of any alternative domestic
services other than from the
capital city to a few tourist destinations and
charter flights), the
question as to whether it is possible to save the
national airline remains
to be answered. In order to do so, one of the
necessary first steps is to
assess the reason, or reasons for the collapse
and failure of the airline.
The tendency of most within and
without of the political environment is to
contend that the airline has been
the victim of continuous gross
mismanagement. But that has not consistently
been the case. To a major
extent, especially in the last five or six years,
Air Zimbabwe has had
managerial personnel with proven ability and boards of
directors that were
capable and well-motivated.
However, just as
it is impossible to make bread without water, so too can a
business not
function and operate effectively without the requisite funding.
For more
than 60 years, the national airline has consistently been
under-capitalised. Government after government has failed to provide the
airline with requisite capital resources and precluded any privatisation of
the airline, notwithstanding that partial or total privatisation would have
been an effective tactic to achieve the much-needed
capitalisation.
There have been many occasions where major,
successful, international and
regional airlines have shown interest in
acquiring a stake in Air Zimbabwe,
only to be rebuffed by government, due
to perceptions that agreeing thereto
would be a surrender of Zimbabwe’s
sovereignty. Ministers and permanent
secretaries have tended to fear any
diminution of their “empires”.
Had Air Zimbabwe been accorded the
capital resources it required, not only
would it not have had to resort to
costly and inadequate borrowings, but it
could have functioned over a
significantly wider range of routes than it
could do with its very small and
ageing aircraft fleet. The enhanced
revenue flows would have significantly
exceeded the additional operational
costs pertaining to the more extended
and diversified routes services,
thereby giving the airline operational
profits, instead of sustaining
endless and escalating
losses.
Very aged and often deficient aircraft could have been
replaced with that
which would be consistently operationally efficient and
less costly to
maintain in service. Properly capitalised, the airline could
have effected
such aircraft replacement and fleet expansion, either by
purchase, or by
leasing of more state-of-art and more suitable
aircraft.
After endless resistance from innumerable governments over
the years, the
idea of privatising the airline (wholly or partially) has in
the last few
months received a belated acceptance by some in the current
government. Of
significance was the realisation that the airline’s
accumulated debt burden
had become so great (in excess of US$140 million)
that it was a major
deterrent to potential privatisation
partners.
With that belated recognition, the Minister of Finance
spoke of government
“ring-fencing” the debt, implying that government would
assume transitional
liability for the debt-servicing, with eventual, future
recourse to Air
Zimbabwe for recovery of the amounts disbursed. But doing so
will not enable
resolution of the airline’s problems and will not bring
about restoration of
operational viability.
To rid it of its
long-prevailing financial difficulties and for it to become
once again an
effective airline, Air Zimbabwe must be significantly
privatised, those
acquiring a stake in it providing it with the working
capital, access to
modern aircraft to service existing and additional
routes, and with
technological inputs
But none will do so if there is a US$140 million debt
overhang. Government
indirectly caused the debt by its failure to provide
adequate capital and
therefore it should assume full liability for debt
settlement. If it does
so, the judicial manager will be enabled to bring
about the airline’s
recovery.
http://www.theindependent.co.zw/
Thursday, 26 January 2012 16:34
Owen
Gagare
ZIMBABWE now has 29 vacant parliamentary seats since the seventh
parliament
began sitting four years ago.
The first seat fell vacant in
December 2008 after Elliot Manyika, the Zanu
PF political commissar and
Bindura South legislator, died in a car accident
along the
Zvishavane-Mbalabala highway in Matabeleland South when his
official
Mercedes Benz reportedly burst a tyre and overturned, uprooting
some trees
in the process.
Four years later, that seat along with 28 others
which have since fallen
vacant and are yet to be filled prejudicing
thousands of people of
parliamentary representation.
In an effort
to promote peace, following the bloody June 2008 election
runoff, parties in
the inclusive government agreed in the GPA to have a
12-month moratorium on
by-elections arguing elections were divisive and
promoted
violence.
However, the moratorium did not stop parties which were not
part of the GNU
from participating in elections. The moratorium expired in
September 2009.
But despite the expiry, the country has not held
by-elections amid
speculation that the GPA partners quietly agreed among
themselves to extend
the moratorium.
Assistant Clerk of
Parliament Johane Gandiwa recently said the seats had
fallen vacant after
the incumbents died, were elevated or expelled from
parliament.
“We have 17 vacant seats in the House of Assembly and
12 seats in the
Senate. Eleven legislators from the House of Assembly died
while political
parties expelled four parliamentarians. Two others were
elevated to top
posts, creating the vacancies,” said
Gandiwa.
Zanu PF has 16 vacant seats, eight of which are in the House
of Assembly
resulting in its MPs in the House dropping from 99 to
91.
The MDC-T has lost eight legislators, four of them in the House
of Assembly,
resulting in the party’s representation falling from 100 to
96.
Welshman Ncube’s MDC expelled three legislators and his party now
has seven
legislators, down from 10.
In the Senate, Zanu-PF’s
numbers have gone down from 30 to 22, MDC-T 34 to
22 while MDC remains with
its six.
In total, 21 legislators have died and of these, 12 were
Zanu PF, among them
Vice-President Joseph Msika and Harare Metropolitan
Province Governor David
Karimanzira.
Four more constituencies
were left unrepresented after the MDC dismissed
three legislators for Nkayi
South, Lupane East and Bulilima East, Abednico
Bhebhe, Jabuliso Mguni and
Norman Mpofu respectively, while Zanu-PF expelled
Tracy Mutinhiri (Marondera
East).
Bhebhe, Mguni and Mpofu took President Robert Mugabe and the
Zimbabwe
Electoral Commission to court demanding that by-elections be
held.
The trio argued that the government was in violation of the
Constitution
which states that by-elections should be held within three
months of a seat
fallingvacant.
Justice Nicholas Ndou ordered
Mugabe and ZEC to call for by-elections within
two weeks but the order was
ignored.
Constitutional law expert Lovemore Madhuku said Zimbabweans
should be
concerned that the executive was violating the
constitution.
Madhuku said: “If they can fail to hold by-elections,
what can stop them
from calling for elections when the time is due. What
they are doing is
contrary to the rule of law and democratic practice. The
issue is that we
have a law in place which says by-elections should be
held.The executive is
taking it upon themselves to decide whether to
implement and whether not to
implement the constitution and this should be
condemned.”
Madhuku said the lack of funds was not a justifiable
excuse for not holding
by-elections.
He, however, said people in
the affected constituencies maynot lost much in
terms of development given
that some constituencies with MPs were not
benefiting from their
representatives.
Political analyst Charles Mangongera said he did not
believe the lack of
financial resources was the reason for not holding the
by-elections.
He said although the electorate was losing out in terms of
representation
their lifestyles would not have changed for the better
because of the
presence of MPs.
“The issue is that the parties to
the GPA have quietly extended the
moratorium on by-elections among
themselves. Obviously this prejudices those
communities without MPs and
senators in terms of representation but I am not
sure that their conditions
of survival would be significantly different from
those where there are
sitting MPs,” said Mangongera.
“There has always been a concern that
the GPA and the inclusive government
weresupplanting democratic processes in
the country as everything is now
being negotiated or quietly agreed on by
the political parties without
taking into account the wishes of the
people.”
In its Ballout update, the Zimbabwe Election Support Network
said it was
concerned that some constituencies were not participating in
national
governance through parliamentary representation.
“Zesn
remains concerned about the lack of representation and urges the
government
to find ways to deal with these problems,” the bulletin
reads.
“Zimbabwe is a representative government and lack of
representation
prejudices these constituencies as their issues and views
cannot find
expression on the national agenda.”
It, however,
looks likely that the seventh parliament will be completed
without
by-elections being held given the lack of interest by the coalition
government partners.
http://www.theindependent.co.zw/
Thursday, 26 January 2012 16:30
By
Charles Mangongera
A FORTNIGHT ago witnessed the disruption of the
constitutional drafting
process by Zanu PF elements masquerading as war
veterans in Manicaland.
Barbaric as it was, this is part of Zanu PF’s
election grand plan, which is
a build up on the party’s Bulawayo conference
resolutions.
Zanu PF’s immediate plan is to rubbish the Copac
process as a precursor to
pulling out of it and President Robert Mugabe
calling for a snap election.
Their reasoning is that they can justifiably
call for an election under the
heavily amended Lancaster House Constitution
once the Copac process has
collapsed.
I am not convinced that
Zanu PF has a cogent and carefully thought out
political strategy in place
beyond the elections. The party seems to be in a
fire-fighting mode and is
behaving like a clueless opposition political
party.
There
seems to be an incessant disposition towards chaos as a means of
survival.
Decisions and actions within Zanu PF have not been based on
rational
thinking, but have been driven by fear of the unknown. Frankly Zanu
PF’s
handling of the constitutional review process has been clumsy and it
makes
one wonder whether party strategists like Jonathan Moyo are really up
to the
task. One minute they announce that they are pulling out of the
process, the
next minute Copac chairperson and Zanu PF representative Paul
Mangwana is
issuing contradicting statements. Is this part of a strategy or
it betrays
lack of cohesion in the party?
I have argued before that Mugabe’s
call for elections is ill-advised. No one
wants an election except for the
small clique of civilian elements and
securocrats that is radically pushing
the election agenda for selfish
considerations. This is an unpopular
election that is not in the national
interest. Zanu PF elements would have
us believe that elections are the only
alternative to the Government of
National Unity (GNU). I argue that they are
not. There are many other
courses of action that Zimbabweans can pursue in
search of a democratic
breakthrough.
A good example is the idea of a transitional authority
or transitional
council. Mavambo, Kusile, Dawn leader Simba Makoni argued
vociferously at
the time of the Global Political Agreement (GPA)
negotiations that having
feuding political parties in a power sharing
arrangement would not work. And
it seems he has been vindicated. His
proposal of a transitional authority
fell on deaf ears, but I am persuaded
that it is time we opened the debate
on the efficacy of such a transitional
mechanism.
I still think that the GNU has a chance of ushering in
a democratic
dispensation if hardline elements in Zanu PF are neutralised.
But if it is
to collapse then the alternative is not an election, but
probably a
transitional authority or transitional council whose mandate is
to run the
affairs of the state until a legitimate government is
elected.
As a transitional tool the GNU has failed. Granted it has
brought a modicum
of political stability and economic recovery. But the
reform agenda has
stalled, thanks to Zanu PF’s recalcitrance. The hope for
many including
those in Sadc and the AU was that the GNU would create
conditions for a free
and fair election through reform of state institutions
and the drafting of a
constitution that would reflect the wishes of the
people of Zimbabwe.
Unfortunately the reform agenda has lost
traction as hardline elements in
Zanu PF have resisted reform at every level
of the governance structure. The
major problem has been that of party-state
fusion, a phenomenon where Zanu
PF party activists are in control of the
levers of the state infrastructure.
A good example is that of permanent
secretaries who are in charge of the
day-to-day running of government
ministries.
A majority of them have exhibited patent allegiance
to Zanu PF and they have
frustrated MDC ministers by sabotaging the
implementation of government
policy and reform of state institutions.
Presidential spokesperson George
Charamba behaves like a Zanu PF political
commissar. Policy disharmony has
been the order of the day and this has
negatively affected the discharge of
government business.
I argue
that elections are not the solution to this morass. This is because
the
conditions on the ground are not conducive for a free and fair election
and
the outcome will be a disputed one. It is time that well meaning
Zimbabweans
got together in the national interest to forge a united front
that will stop
Mugabe and his henchmen from imposing an unpopular election
on the country.
Only a strong coalition with visionary leadership can get us
out of this
mess.
Zanu PF hardliners will obviously push Mugabe to go it alone in
an election.
Boycotting such an illegitimate process is not necessarily
giving Zanu PF a
blank cheque to take over the country. There are
well-meaning people in Zanu
PF who do not agree with the groin-kicking
politics that is being advocated
for by the hardliners in the party and the
security establishment.
They will not openly disagree with this
scorched earth approach but they
will vigorously push for wise counsel to
prevail over foolish counsel. When
it matters most they will side with the
people. Even if Zanu PF goes it
alone in an election, the resultant
government will be an illegitimate one
and it will not be able to function.
This will force Zanu PF to come back to
the negotiating
table.
Drivers of positive change in Zimbabwean society need to put
aside their
political differences and varied interests to agree on a
national
transitional charter that spells out a credible road map to free
and fair
elections. If there is need for an alternative to the GNU the
charter will
also draw up terms of reference for a transitional council or a
transitional
authority that is made up of eminent personalities from civil
society,
business, the clergy, traditional leaders and the intelligentsia.
Political
parties can participate but should not be part of the transitional
council
or transitional authority.
Its main brief would be to
complete the process of drafting a constitution,
which should be a fairly
simple exercise given that there is enough raw data
to work with. The draft
can easily be a hybrid of the Chidyausiku Commission
findings, the NCA
draft, the Kariba draft, the Law Society of Zimbabwe
draft, the Copac draft,
and any other drafts that are out there.
The transitional council
or transitional authority will also be tasked with
the task of urgently
reforming state institutions and running a credible
election that will
produce a legitimate government. With sufficient
commitment and hard work
this can be done in under a year. Zimbabweans are
itching to get down to the
hard work of rebuilding this beautiful nation.
Charles Mangongera is
a Harare-based political analyst.
http://www.theindependent.co.zw/
Thursday, 26 January 2012
16:44
‘REVOLUTIONARY” music fans will be elated to know that the Born
Free Crew
has released yet another scorcher; this time entitled We Salute
you.
The Herald reports that the group, “popularly” known as Born Free Crew
(Team
88) has “become fashion icons in their own right”.
The 88 stands
for President Robert Mugabe’s age. Apparently the group has
also introduced
a new hairstyle called “Gushungo”.
“The haircut is found in two styles, one
that incorporates a mohawk and
another which is simple a short haircut but
with the words “Gushungo” on the
sides,” states the Herald.
How
original!
“A number of youngsters are already spotting (sic) the new
hairstyle just
like the Gushungo clothing line,” we are told.
As usual
they are only “spotted” in the pages of the state media.
Who can forget the
much-heralded House of Gushungo fashion stable which had
“hit the capital by
storm”.
The clothing stable is set to “redefine” the country’s fashion
industry
which is mostly dominated by foreign clothing labels, ZBC had
gushed at the
time of the launch.
In spite of the seemingly
ubiquitous nature of these clothes and hairstyles,
they are strangely absent
on the streets.
The Born Free Crew has already released a new single called
Tirivanhu Vamwe
that hit the airwaves last week. Among the people starring
in the video of
the song is, you guessed it, Media, Information and
Publicity minister
Webster Shamu.
ZBC reports that the song Gushungo ––
referring to President Mugabe –– also
features on the album. Talk about
overkill!
The Born Free Crew seems to have taken
a cue from Simba Makoni’s
Mavambo/Kusile/Dawn party’s “kaOne” mantra. This
is because another “hit”
song on the album is President Mugabe Ka
1.
Shamu, who is also the patron of the Zimbabwe Union of Musicians,
commended
the group for their efforts in “enlightening the nation”, saying
even adults
should take a leaf from the youthful group whose understanding
of the
country’s history is “sound and based on the realities of the
nation’s
bitter struggle for independence”.
According to the Herald the
group started off as an R&B outfit. They,
however, later changed their
genre to singing “revolutionary” songs.
“Since then, Born Free Crew has been
on every radio DJ’s playlist while
their videos got generous airplay on the
small screens.”
The fact that Shamu stars in the video might have something
to do with it,
we are sure.
Meanwhile, ZBC
reporter Dorothy Mavolwane left fellow journalists befuddled
on Tuesday
after getting angry on Zanu PF’s behalf at Prime Minister Morgan
Tsvangirai’s Strathaven house.
A special envoy, Emmanuel Issoze Ngendet,
from Gabon President Ali Bongo
Ondimba had come to solicit Zimbabwe’s
support for Jean Ping’s re-election
bid for the AU Commission
chairmanship.
After making a courtesy call on Acting President John
Nkomo at his
Munhumutapa Offices, Issoze Ngendet held a private meeting with
Prime
Minister Morgan Tsvangirai at his Strathaven home.
While
awaiting the end of the meeting, journalists mingled on the lawn of
the
Prime Minister’s residence. Among them was Mavolwane whose jovial
demeanour
changed upon the emergence of the envoy from the house.
Needing no
invitation she charged towards Issoze Ngendet brandishing a
microphone. The
clearly bemused envoy could only exclaim “you
again”.
That was Mavolwane’s cue to commence the
interrogation. A barrage of
questions ensued with the envoy given little if
any time to respond.
Why is his country soliciting support from Zimbabwe yet
Gabon is “meddling
in the country’s internal politics through assisting the
MDC-T?” Mavolwane
wanted to know.
Issoze Ngendet responded by
saying his country has a role to play in the
transition period in
Zimbabwe.
However, this was not to the intrepid state reporter’s
satisfaction.
“Questioned further on what the ‘transition’ is about the
special envoy
failed to explain his clear position.”
Mavolwane
wasclearly peeved on her handlers’ behalf and she was taking no
prisoners.
Clearly the “African solutions to African problems” mantra is an
empty
vessel.
“Relations between Harare and Libreville have been frosty
over the years
following revelations that Gabon was assisting the MDC-T to
access funding
from France in violation of Zimbabwean laws which prohibit
external funding
of political parties,” ZBC claims.
Talk about the kettle
calling the pot black. Are we then to surmise that
China is also “meddling”
in Zimbabwe’s internal politics by supporting Zanu
PF? Is it only OK if Zanu
PF receives assistance?
Defence minister Emmerson
Mnangagwa appears to be confused about the nation’s
defence policy. He
claims it is premised on “the need to counter the illegal
regime change
agenda sponsored by some Western countries”.
That may be Zanu PF’s
mantra but it is not shared by the rest of the
country.
Speaking
to officers attending a staff course at the Zimbabwe Staff College,
Mnangagwa said: “With the emergence of the regime change agenda around the
year 2000, the defence policy had to be tailored towards countering
influences that were being spread by the Western media through such devices
as the Internet, CNN, BBC, and Sky News.”
So defence policy is
tailored by Zanu PF’s electoral defeats in 2000? Why
should the rest of the
country share their paranoid delusionism? What is
“illegal” about wanting to
see regime change in Zimbabwe? Isn’t that the
desire of the majority of the
population who voted against President Mugabe
in 2008? Did they not vote for
change?
Given Zanu PF’s electoral record, can the BBC and CNN be
expected to pretend
all is well in Zimbabwe? Zanu PF already has a
mouthpiece for its pernicious
propaganda. Why should other broadcasters be
expected to mislead the
Zimbabwean public as
well?
The country’s defence policy derived its
legal basis from the constitution,
the minister conceded. “The
constitutional obligations of the ZDF are
threefold,” he said. “That is to
defend Zimbabwe’s independence,
sovereignty, territorial integrity and
national interests…”
We would go along with most of that. But the national
interest is not
defined by a defeated former ruling party.
It is not in
the national interest to sabotage commercial agriculture or
close down a
once great city such as Bulawayo.
Mnangagwa said Zimbabwe’s defence policy
respected regional and
international treaties and conventions that the
country was party to. Does
it? What about the torture that Jestina Mukoko
endured in 2008?
What about the beatings MDC leader Morgan Tsvangirai, Sekai
Holland and
others went through at Machipisa police station in 2007?
The
minister said the violent removal of sitting presidents in some North
African countries showed the need to come up with defence policies that
safeguard a nation’s sovereignty.
Indeed, we must learn the lesson of
leaders who refuse to change when the
people demand
it!
Muckraker was intrigued by a picture
purporting to be that of Prof Geoff
Feltoe in Tafataona Mahoso’s African
Focus column in the Sunday Mail of
January 22.
This was in connection
with Zanu PF’s current campaign to portray Copac’s
endeavours as an alien
project.
“”The most spectacular achievement of the UZ Faculty of Law to
date,” Mahoso
claims, “has been the entrenchment of Prof Geoff Feltoe as
Zimbabwe’s
philosopher king on legal matters… and it is the students and
associates of
the same Geoff Feltoe who have guided Copac’s calculated
abandonment of the
people’s views in the drafting of a new constitution,” he
says.
Beware of anybody seeking to be a purveyor
of the “people’s views”. It is
usually their own views that are being
dished out. Mahoso goes on to condemn
what he calls “the degrading of
national laws and national constitutions and
the elevation of allegedly
universal norms”.
These ideas had been propagated through
Anglo-American seminars for the
legal fraternity over a 10-year period,
Mahoso claims. The British and North
Americans set the agendas for these
meetings and forged the terminology
which sets the tone for the seminars,
Mahoso declares.
These in turn set the stage for Copac and
regime-change. Behind all this is
the eminence grise of Prof Feltoe, we are
led to believe. In fact of course
the universal norms Mahoso denounces are
the norms most countries embrace
now, except of course, as he points out,
Vietnam, Iraq and Venezuela!
He says at the end of a law seminar in
Harare in 1989 “it was clear that the
Anglo-American objective was literally
to re-educate the judiciaries of the
entire Commonwealth in order to make
them receptive to manipulative projects
such as the Tibaijuka mission and
other missions by the International Bar
Association.”
It is worth
having this on the record to expose just how delusional Zanu PF’s
publicists really are. To underline Mahoso’s claims, the Sunday Mail
published a photo of somebody who it said was Feltoe but obviously wasn’t.
It didn’t even look like him.
Clearly the real world isn’t allowed to
impinge upon Zanu PF’s
delusionalism.
Those
naďve commentators telling us there has been a change of heart by the
Americans on sanctions should read the remarks by Ambassador Charles Ray
last week.
There had not been tangible evidence or positive
political movement in
Zimbabwe to warrant a repeal of the sanctions law, he
said.
“I need to take this opportunity to say the ingredients that inspired
the
enactment of Zidera are still very much alive,” Ray said. “One would ask
whether the violence, rhetoric and political persecutions and arbitrary
arrests are not still part of this country’s political
landscape…”
“So until there is positive movement like mechanisms for
free and fair
elections when political persecution ceases, Zidera is going
nowhere.”
Ray said he did not think sanctions was a useful tool to deal with
because
there have been cases where they have been abused by local
politicians who
have taken advantage by blaming sanctions for every ill that
has visited the
country.
“Someone fails to do their job they
blame sanctions,” Ray said. “No rain,
they blame sanctions which I think is
sad really.”
So do we.
Muckraker was shocked
by the reported arrest of Victoria Falls book-seller
Sinikiwe Matore who had
been marketing Morgan Tsvangirai’s biography, At the
Deep End, among other
publications.
We were unaware that it was illegal to read the book. What has
the country
come to when books are banned?
In Germany the Nazis collected
works by Jewish authors and set them alight
in a huge bonfire. With some
prescience the poet Heine remarked that
societies that burn books will very
soon burn people!
Finally a note to the Herald’s
business reporters. Prince Felipe is not “the
Spanish monarch”, he is Prince
of the Asturias, son of the monarch.
Later in the story he became “a member
of the Spanish monarchy”.
Let’s hope that by the time he gets here the
newspaper will have clarified
his status. Perhaps Minister Walter Mzembi can
explain to the ever-helpful
Herald exactly who the prince is!
http://www.theindependent.co.zw/
Thursday, 26 January 2012
17:04
THAT Zimbabwean companies are struggling owing to tight liquidity
conditions
in the country has been evident on the market since the adoption
of multi
currencies three years ago. A quick glance at public companies’
financial
statements shows how they have been forced to accept expensive
short-term
borrowings. Earnings are eroded by finance charges; Rio Zim, RTG,
Cairns
etc. The list is long.
But despite the challenges affecting
business, government has not bothered
to deal with a major factor that
exacerbates the liquidity problems; the
absence of a lender of last resort
in the market.
Since the adoption of multi currencies, the
Reserve Bank of Zimbabwe’s
lender of last resort (LOLR) function has not
been restored. And government
does not seem to be treating the matter with
the urgency it deserves.
The restoration of the central bank’s LOLR
role has been at a snail’s pace,
with government committing paltry funds
towards the purpose.
Finance minister Biti this week said he would
allocate at least US$20
million towards the US$100 million LOLR fund he
announced in his 2012 Budget
statement to augment the US$7 million he had
already availed to the Reserve
Bank. The money would come from a US$112
Special Drawing Rights drawdown he
intends to carry out soon with the
International Monetary Fund.
However, the US$20 million to be
allocated towards the LOLR purse is a drop
in the ocean. It baffles the mind
why Biti, who has been vacillating on
drawing down the SDRs has not
committed the US$112 million towards the LOLR.
To make matters worse,
previous draw downs on the SDR funds have not been
accounted for in
full.
Biti’s failure to empower the central bank’s LOLR role has seen
local banks
with excess cash lending to their peers at a premium, according
to Gono.
That goes to show the desperation in the financial sector and
gravity of the
need to empower the central bank as the LOLR.
The
LOLR function is a preserve of a central bank and entails offering loans
or
liquidity support to banks experiencing liquidity challenges or are
considered highly risky or near collapse. Owing to this problem, cash-rich
individuals have assumed the role of the central bank and advanced
exorbitant loans to hapless individuals and banks.
More
worryingly, the very absence of the central bank’s role as the LOLR has
resulted in the financial sector failing to consolidate stability attained
when the country was dollarised in 2009.
Universally, the absence
of a LOLR is not ideal for the stability of the
financial system.
International best practice requires that the LOLR pool in
a dollarised
economy should constitute between 50% and 150% of the banking
sector’s
capitalisation or 5% to 15% of the banking sector’s deposits.
Once
the LOLR status is restored, the inter-bank market, which has been
ineffective due to the non-availability of this much needed function, will
start to play a critical role in the distribution of credit across the
entire economy. The interbank market is a market in which banks extend loans
to one another for a specified term.
If a bank cannot meet
its liquidity requirements, it will need to borrow
money in the interbank
market to cover the shortfall.
Against a background such as ours,
banks have nowhere to go should they need
liquidity support, even if this is
just overnight.
The central bank feels that a LOLR fund based on a
proportion of the deposit
base has a better relationship to potential
liquidity developments on the
market. When Biti last year announced in his
2012 budget statement that he
would allocate US$100 million towards an LOLR
fund, Gono applauded him,
saying the establishment of an effective lender of
last resort function
would undoubtedly restore “some confidence” in the
banking sector, and spur
economic activity. Alas, the full amount for this
very important function is
yet to materialise.
Meantime the
short-term nature of deposits has also not helped the situation
on the
liquidity front, with most banks resorting to lending short-term.Gono
cautions that persistent liquidity challenges may lead to heightened
systemic risk. It is generally accepted that an illiquid market increases
the cost of credit and heightens default probabilities among borrowers.
Non-performing loans are not good for any bank.
http://www.theindependent.co.zw/
Thursday, 26 January 2012
17:02
Constantine Chimakure
ZANU PF never ceases to amaze! At its
politburo meeting on Wednesday, the
party once again exhibited its
resistance to the full consummation of the
global political agreement (GPA)
by insisting that elections be held this
year with or without a new
constitution.
This came against a backcloth of industry and
commerce’s declaration last
week that the country should not be rushed into
an election without
implementing necessary democratic reforms that will
result in a free and
fair poll.
Business warned of the political,
social and economic consequences of any
election to be held under the
current dispensation where violence rears its
ugly head, biased coverage in
the public media, and no legislative and
security sector
reforms.
Business is worried that without fully consummating the GPA,
the country
will slide back to June 2008 where anarchy reigned
supreme.
The economy almost imploded because our politics were
stupid.
Industrial capacity utilisation was below 10%, the health and
education
sectors were almost dead, the brain drain reached alarming levels
and the
majority of people wallowed in abject poverty.
Zanu PF’s
hullabaloo on elections is retarding the economic recovery gained
in the
past three years. The talk of elections and the indigenisation drive
have
affected prospects of direct foreign investment. Investment is timid,
it
goes where it is wanted; where there is rule of law, which encompasses
property rights and political stability –– two key issues Zimbabwe is
lacking today.
We wonder why it has been so difficult for Zanu PF
and the two MDC
formations to simply adhere to what they have agreed
on.
The GPA is their product and, therefore, should be implemented
without
equivocation. The main roadmap to free and fair polls is a new
constitution.
Without a new constitution, Zimbabweans should form a united
front to resist
Zanu PF’s plot to stampede us into an election solely meant
to secure
political papacy for the ageing President Mugabe.
It is
now common cause that ill-health and age is taking its toll on Mugabe
hence
the scheme to fast-track elections in the vain hope that the veteran
leader
at 88-years-old would be able to withstand the vigorous campaign for
power.
We share business’ concerns that without fully
implementing the GPA any
election will be a farce and the economy will
suffer. We don’t want to go
back to the dark days of 2008.
We are
in agreement with the ZNCC president, Oswell Binha, that holding of
elections this year or 2013 is not the issue, but the type and quality of
the polls.
“Holding elections this year or next year is not
materially important, but
what type of election? We do not have the luxury
and latitude to return to
chaotic electioneering regimes.
It is
bad for business,” Binha was quoted saying last week. “The country
needs to
determine key enablers to a peaceful election that will certainly
protect
security of investment, freedoms, and indeed growth and development
of our
means of production. Anarchy and chaos will certainly destroy the
gains of
stability we have enjoyed to date and we implore government to deal
with all
underlying issues to ensure a peaceful poll.”
Binha hit the nail on
the head when he said the urgency for now should be on
improving power and
energy supplies, attending to the country’s risk factor
that has resulted in
the failure to attract lines of credit and foreign
direct investment, and
guaranteeing business confidence.
We hope Zanu PF will take heed of
business’ advice, otherwise we are doomed
to another year of arbitrary and
damaging decisions.
cchimakure@zimind.co.zw
http://www.theindependent.co.zw/
Thursday, 26
January 2012 17:01
Itai Masuku
THE strike by civil servants
implies a very unnerving underlying
possibility; that the inflation figures
produced in this country may be out
of kilter with the real cost of
living.
To many of us simple Simons the inflation figures don’t add up.
We are told
by those in the know that month on month inflation figures
between November
and December were 0,2%.
These are the
official figures but that did not appear to be the case when
we were doing
our Christmas shopping.
In fact we hardly did any shopping at all as
prices had jumped by as much as
100%, whether you were talking of food or
non-food products.
Just by way of example almost all transporters
hiked their fares by 100%,
whether they were local commuter omnibus
operators or long distance service
operators.
Transport
constitutes one of the largest costs for the average consumer, yet
we are
told non-food inflation, which surely must include the cost of
transport
contributed to this 0,2% figure.
With all due respect to our
statisticians, we’re not educated enough to do
the sophisticated
computations which actually tell them that the answer to 1
+ 1 = 1.999999,
but we would want their statistics to be as close to the
truth as in this
example. But judging from the prices we’re seeing and the
inflation figures
they’re giving, their formula for adding one plus one is
currently coming up
to 0,1.
Is our annual inflation rate really 4,9% as at December as
stated
officially? That, after a hefty 31% increase in Zesa tariffs in the
course
of the year?
Doesn’t the cost of electricity have a heavy
weighting on the in-basket of
goods and services that constitute our
Consumer Price Index (CPI)? We shan’t
even ask how the same hike affects the
Producer Price Index, where the
producers may be compelled to pass on the
costs in the form of price
increases.
The cost of beef has more than
doubled since dollarisation in 2009 and so
has the price of a bar of
soap.
One doesn’t have to rack their brain before they can remember a
product that
has risen by more than 100% in the short lifetime of the
multi-currency
regime.
So, while civil servants could perhaps eke
out a living from their US$150
monthly salary, it clearly could not keep up
with prices in 2011, hence why
they demanded an increment and got
one.
However, without trying to make a case for them, prices have
gone up
dramatically.
In fact the statistics for the Poverty
Datum Line (PDL) in Zimbabwe, which
always show the PDL going up by an
average 5% to 8% every month, appear to
be a better reflection of the rate
of price increases in Zimbabwe.
The PDL has risen from US$250 in 2009
to more than US$500 as at last year,
if one goes by figures released by the
Consumer Council of Zimbabwe (CCZ).
One proposes that to get an
accurate reflection of prices in Zimbabwe, the
Reserve Bank and the Finance
ministry should use the database used by the
CCZ in order to come up with a
more accurate CPI. Otherwise we’ll continue
basking in this feel-good single
digit inflation figures Euphoria when the
reality is otherwise.
