| The ZIMBABWE Situation | Our
thoughts and prayers are with Zimbabwe - may peace, truth and justice prevail. |
Sunday Times Foreign Desk
Zimbabwe is printing a Z$1 000 note for the
first time as the country's
economy implodes.
And in a related
development, economists predict that Zimbabwe's crippling
inflation rate
could rocket to 1 000% by the end of the year.
In a bid to alleviate
the shortage of bank notes, government on Friday
injected Z12-billion into
the dry financial system.
This brought the amount of printed money
recently introduced into the
banking sector to
Z$24-billion.
Finance Minister Herbert Murerwa on Friday confirmed
the move, saying it
would stem the worsening shortage of cash in
banks.
This week some banks were unable to issue paper money to
depositors as they
had no money.
He also said that government
would soon introduce the $1 000 bill to reduce
the large amounts of money
that people need to carry on them to pay for
goods and
services.
The highest currency denomination is currently the $500 note.
The printing of bank notes and the accelerated money supply
will add fuel to
Zimbabwe's galloping inflation.
As business
reeled under ever-increasing prices, four bakeries were fined
this week for
doubling the black market price of bread from $550 to $1 000
without
government approval.
The government-controlled wholesale price of
bread is $225, while a retail
loaf is fixed at $250.
This dramatic
bread price increase was precipitated by a rise of more than 1
000% in the
state-run Grain Marketing Board's selling price of wheat. The
board increased
the wheat price more than twelve times, from $30 000 to 366
584 a
ton.
This forced millers to increase the price of flour eight-fold,
from 102 000
to $870 000 a ton. Bakers responded by almost doubling the
unofficial price
of bread. Bakers Association of Zimbabwe chairman Armitage
Chikwavira said
the bread price increases were necessary to ensure the
viability of bakeries
currently teetering on the brink of
collapse.
"The problem is that government has kept price controls on
bread and other
goods," he said.
"The bakers have two options . .
. the first being to stop production
altogether if they can't pass on the
increase to their consumers, or
continuing to produce and charging higher
than the gazetted price."
However, government on Friday reacted by
fining four leading bakeries
$20-million collectively for flouting the price
freezes.
Government has also launched clampdowns on retail shops
selling basic
commodities and other goods at above the official
prices.
Zimbabwe's inflation rate this week surged to 364.5%.
But economists say the real rate of inflation is currently
above 400%,
because the official one is calculated on the basis of the
controlled price
index, which does not apply on the informal market, where
most goods are
found.
About 70% of Zimbabweans live below the
global poverty line of less than
US$1 per day.
With inflation
skyrocketing, Zimbabwe's current critical shortage of basic
foodstuffs is set
to worsen.
Business Report
White Zimbabwean cane farmers take Anglo unit to
court
July 20, 2003
A group of white sugar cane farmers in
southeastern Zimbabwe are
taking a subsidiary of Anglo American Corporation
Zimbabwe (Amzim) to court
for allegedly participating in the "theft and
plunder" of their assets by
President Robert Mugabe's
supporters.
The farmers accuse the Zimbabwe government of illegally
resettling new
black farmers on their land without following proper
procedures.
They say the new black farmers are illegally looting
and harvesting
the cane crop they had planted for this season and selling it
to Hippo
Valley Estates, the Anglo subsidiary.
Their court
application is aimed at stopping Hippo Valley Estates from
receiving the cane
delivered by the new black farmers. They also want Hippo
Valley Estates to
pay them for cane it has already received from the
black
farmers.
"They [black farmers] moved into our farms and
they are reaping our
crops and selling them to Hippo Valley Estates. They are
reaping what they
did not sow," said Peter Henning, one of the 50 affected
farmers.
"Hippo Valley is even providing them with transport ...
This is all
illegal ... Some of us having long-standing agreements to have
our cane sold
and milled at Hippo Valley Estates and the company should only
accept the
crop delivered to it by the rightful owners," said
Henning.
He said about five farmers had instituted the legal action
against
Hippo Valley Estates.
If they win, these would become
test cases to help the rest of the
farmers.
Henning said the
farmers had decided to sue Hippo Valley after
unsuccessfully appealing to the
company to stop receiving the cane from the
black farmers and asking it to
pay them for the cane already delivered.
"We don't know why Hippo
Valley did not co-operate with us. Maybe they
fear retribution from the
government and feel that they have to co-operate
with it to safeguard their
other business interests here," said Henning.
But the local
Chiredzi district land committee, which is tasked with
acquiring land, has
refuted the claims and written to Mugabe, asking him to
charge the farmers
with treason for resisting his land seizures
.
The land
committee accused the farmers of trying to cling to their
land and of
resisting black resettlement.
"In Chiredzi district the former
white commercial farmers are still
clinging on to the land that was
designated for resettlement purposes.
Racism by the unrependent (sic) whites
is still rife and the A2 farmers
[black farmers] in Chiredzi are considered
or labelled as thieves who steal
the white man's sugar cane," read a copy of
the letter.
The letter argued that all the cane belonged to black
farmers and
accused Anglo of not paying some of the black farmers who were
delivering
cane to its mills. Some Anglo managers said they were withholding
payments
to anybody until the matter had been finalised in the courts, the
letter
said.
"There is therefore need for political involvement
at the highest
level to tell ... Anglo American Corporation that frustrating
government's
land reform programme is treasonable and uncalled for," it
said.
A statement issued by an Anglo spokesperson in South Africa
said since
the beginning of the current milling season, Hippo Valley had been
taking
delivery of sugar cane from commercial cane farmers and from newly
resettled
A2 cane farmers.
This is taking place in terms of existing
contracts with the parties
concerned and in terms of the law that required
millers, including Hippo
Valley, to receive cane grown in Zimbabwe for
processing.
"To date Hippo has not paid any party for cane
deliveries," the
statement said.
"In view of the serious nature
of this dispute, which needs to be
resolved urgently, Hippo Valley Estates,
in the exercise of its legal
rights, is instituting interpleader proceedings
in the high court in order
to obtain a determination on the competing and
adverse claims which are
being made in respect of the cane delivered to the
mill."
The statement said Hippo Valley was not party to the
litigation.
The high court had issued provisional orders against
the government,
which overturned section 8 acquisition orders previously
served on 20
commercial farmers. - Independent Foreign Service,
Johannesburg
Business Report
Economic meltdown leads to innovative banking
measures
July 20, 2003
Johannesburg - Bankers in Zimbabwe
are seeking urgent reassurances
from the government that the economy will not
collapse by the end of this
year after economists warned inflation would
reach 400 percent by the end of
the month.
Demand for cash has
far outstripped supply, and banks have run out of
money to keep formal
business transactions going.
The Zimbabwe Central Statistical
Office (CSO) says the official
inflation figure is 364.1 percent. The
authority, however, admits it is
using variables for calculation because the
hard reality on the ground is
certainly different.
Economic
analyst Eric Block last week told the Zimbabwe Independent
newspaper that by
his calculations, inflation was realistically about 380
percent.
"Official inflation is always 20 percent less than the real inflation
rate
because the CSO uses spending patterns of the last quoted prices
of
controlled goods. But the reality of Zimbabwe today is that most
basic
commodities are pegged at black market rates," he said.
Zimbabwe's economy, the fourth largest in Africa after South Africa,
Nigeria
and Egypt, is facing its worst crisis since independence from
Britain in
1980.
It is in its fourth year of recession and hundreds of
companies have
either closed or have been forced to scale down operations,
some cutting the
number of working days to three.
The
Confederation of Zimbabwe Industries compiled a list of 400
manufacturing
companies that closed shop over the past two years, forcing
more than 70
percent of the workforce on to the streets.
Opposition politicians
blame President Robert Mugabe's policy of
seizing hundreds of white-owned
farms for the resettlement of landless black
peasants as a cause of the
economic meltdown. Mugabe denies this, arguing
the economy has been wrecked
by enemy forces in Europe and the West, and
successive years of
drought.
Bankers began urgent talks with government officials this
week over
the worsening shortage of bank notes, warning that the meltdown
would soon
reduce the nation to barter trade.
Commercial banks
desperate for cash have been forced to buy money from
retailers and from
individual currency sharks who are operating a thriving
black market
financial industry.
Harare banker Goodson Nguni said there was an
urgent need to revamp
Zimbabwe's banking system.
"This
hyperinflationary environment calls for banks to implement a
host of changes
which include reducing charges on cheque transactions and
their clearance
period.
"Banks can also replace charges on cash deposits with
commissions as
an incentive to deposit and remove or at least reduce bank
charges," he said
.
Calls have been made for financial
institutions to intensify the
electronic banking system. Nguni said while
Zimbabwe was struggling with
inflation, on the upside it encouraged bankers
to explore other ways of
dealing with or replacing cash
altogether.
Some institutions have taken heed and cellphone
operator Telecel
recently introduced a billing system for its clients wishing
to make
payments.
A company called Uniswitch is developing a
system whereby clients can
withdraw cash from any bank's automated teller
machines, and pay for fuel at
petrol stations using a card.
In-store banking is another way of easing the problems where ordinary
people
are reduced to carrying more cash than the groceries they need.
Some banks have already formed partnerships with retail outlets.
Kingdom
struck a deal with the Thomas Meikles Group, Century is signed up
with OK and
Bon Marche, Trust with Farm and Country Centre and NMB is
dealing with Spar
supermarkets.
Nguni said bankers would convince the government
about the advantages
of electronic and in-store banking: customers could shop
and bank under one
roof; there was no need to move around with large wads of
money; and
supermarkets could bank daily takings under one roof.
The Reserve Bank of Zimbabwe, stung by accusations of indecisiveness
and of
burying its head in the sand, has said it will release Z$24 billion
(R229
million)into the money market by next week.
But analysts say
increasing the money supply is not the solution and
will fuel inflation by
creating "too much money chasing too few goods".
Economists have
dismissed this injection as a non-event as the money
would be gobbled up
quickly, because demand for cash is so high.
Analysts believe the
official exchange rate of Z$824 to the US dollar
is too low and the central
bank should devalue the currency to match the
black market rate, where one US
dollar fetches up to Z$2 500. This would not
only lead to foreign currency
inflows into the official market, but also
weed out speculation by black
market dealers who are holding on to cash.
Commercial banks argue
that Zimbabwe's problems can only be tackled by
the drafting and
implementation of long-term solutions to issues like high
government
recurrent expenditure and high budget deficits; control of money
supply
through the implementation of realistic and market-related interest
rates;
and addressing low foreign capital inflows. - Kenneth Chikanga
The Scotsman
Mugabe grooms ruthless successor
TREVOR
GRUNDY
ZIMBABWEAN President Robert Mugabe is manoeuvring to ensure a
key political
ally known as ‘The Butcher of Matabeleland’ is installed as his
successor
before standing down on his 80th birthday.
The prospect of
Emmerson Mnangagwa assuming power - which would ensure
Mugabe avoids a
potential trial for human rights abuses and allow him to
remain in his
palatial home called ‘Gracelands’ - will dismay political
opponents as he is
considered to be even more dangerous than Mugabe himself.
Mnangagwa
masterminded the slaughter of more than 25,000 civilians opposed
to Mugabe in
Matabeleland in the mid-1980s and was also largely responsible
for the
controversial land reform programme that resulted in attacks on
white farmers
by army veterans who seized their property.
Despite mounting speculation
by Western diplomats that Mugabe will
relinquish power this December,
informed sources in Harare told Scotland on
Sunday that the Zimbabwean leader
has chosen his birthday, February 21, to
make his departure from
office.
"He feels that at the age of 80 he will have a wonderful excuse
to step down
and hand over to a younger man," a former cabinet minister in
Bishop
Muzorewa’s short-lived government said.
At that age no one
could accuse him of cowardice, said the source, who has
asked not to be named
at a time when the dreaded Stasi-trained Central
Intelligence Organisation
(CIO) is hunting down "dissidents" and "traitors
to Africa".
"Robert
is a bit like Macbeth. He’s haunted by the number of people he has
killed. He
is terrified of going on trial somewhere and being remembered not
as a hero,
but as a monster," the source said. "He knows that Emmerson
Mnangagwa is a
safe pair of hands because they’re as bloody as his own."
The source was
once a close friend of the Zimbabwean president and knows the
country’s
leaders intimately.
He added: "He [Mugabe] wants Emmerson Mnangagwa to
take-over, and although
there are other people in line for the job, I can’t
see either the Central
Committee or the Politburo challenging the will of a
man who still somehow
controls the police, the army and most important of
all, the CIO, which has
been responsible for thousands of murders and
political assassinations since
independence in 1980."
Mnangagwa, 60,
has been at Mugabe’s side since the late 1970s when the
Jesuit educated
Marxist guerrilla fighter fled to Mozambique, where he
helped lead a
protracted war against white rule in Zimbabwe, then
called
Rhodesia.
After independence, Mnangagwa was given key
ministries in Mugabe’s
handpicked cabinet of loyalists, and even when he lost
his seat at the 2000
election, he was made speaker of the parliament, a post
he holds today.
But Mnangagwa was always more than a political adviser to
Mugabe.
The source said: "We must never forget that between those
dreadful years
1982 and 1987 when Mugabe unleashed the North Korean-trained
Fifth Brigade
of the Zimbabwe National Army and let hooligans in uniform
slaughter upwards
of 25,000 black civilians because they opposed his rule, it
was Mnangagwa
who stood beside him and ran the CIO."
Last year,
Mnangagwa, who also heads up Mugabe’s vast business empire in the
Democratic
Republic of Congo (DRC), led a government and ruling party
delegation to a
meeting of Thabo Mbeki’s African National Congress party
in
Pretoria.
Crucially, the South African leader sees Mnangagwa as the
next leader of
Zimbabwe.
Informed reports say that when US President
George W Bush was in South
Africa last week, Mbeki told him to stop talking
about Mugabe’s track record
of human rights abuses.
While the
Americans and the British want to see a "democratic" presidential
election
when Mugabe steps down, the South African leader is said to be
content to see
Mugabe choose his successor, as long as his choice is
approved by his Zanu-PF
party.
While Washington and London believe opposition leader Morgan
Tsvangirai of
the Movement for Democratic Change (MDC) would easily win a
genuinely fair
election, Mbeki wants to see an ideologically and politically
correct ‘old
style’ leader take over north of the River
Limpopo.
Sources say Mbeki personally likes Mnangagwa, who has a legal
and business
background.
He is said to be a man of great personal
charm and is also a close friend of
one of Zimbabwe’s most important men,
Army commander General Vitalis
Zvinavashe.
It was Zvinavashe who
commanded the Fifth Brigade when it invaded
Matabeleland in a terrifying
campaign to wipe out the opposition, which was
led by Dr Joshua Nkomo of the
Zimbabwe African People’s Union (ZAPU).
When President Bush was in South
Africa he described Mbeki as "the point
man" on Zimbabwe.
Zimbabweans
in exile in South Africa - there are now close on two million of
them - say
that Mbeki remains "highly suspicious" of Tsvangirai.
President Mbeki is
known to regard the MDC as a creation of white Zimbabwean
farmers. The MDC
receives funds from wealthy whites with mining and farming
interests in
Zimbabwe and Mbeki regards Tsvangirai as little more than a
puppet
manipulated by big business.
Mugabe and Mbeki have become close friends
since 1999.
Basildon Peta, the respected Zimbabwean correspondent in
Pretoria, said this
week that America recently pledged a "reconstruction"
package for Zimbabwe
worth up to $10bn (£6.2bn) over an unspecified time
frame.
The deal, says Peta, was discussed by the two leaders during a
private
meeting in Pretoria.
Opposition politicians fear that now he
is America’s "point man" on
Zimbabwe, Mbeki will be able to persuade
Washington to accept any new leader
as long as he demonstrates a desire to
"start again" without embarrassing
the outgoing Mugabe.
Rival
contenders
FORMER finance minister SIMBA MAKONI who is known to be the
favourite of
America and Britain. He opposed Mugabe’s land reform programme
which he said
would cause inflation to soar and even more
unemployment.
Makoni is popular with whites in Zimbabwe and big business
in South Africa,
but he has little support in the townships, from the MDC
opposition or from
the churches.
DUMISO DABENGWA, former home affairs
minister, who fought against the
Rhodesian forces with the Zimbabwe African
People’s Union under Joshua
Nkomo.
He rose to become the commander of
Nkomo’s military forces and was known as
the uncrowned king of
Matabeleland.
A former opponent of Mugabe, he sided with the government
after 1987 and
lost the support of the young and the MDC
opposition.
MORGAN TSVANGIRAI, the leader of the main opposition group,
the Movement for
Democratic Change, is still challenging the result of last
year’s contested
presidential election through the Zimbabwean
courts.
The ballot last year gave Mugabe a further six-year term in
office but there
were claims of vote-rigging and intimidation,
The
former trade union leader, spent 10 days in prison on treason charges
for
allegedly plotting to overthrow Mugabe.
Did you know that some PENSIONERS are starving in Zimbabwe ?
Did you know
some pensioners have committed suicide because they could not
afford their
medical bills ?
Rampant inflation heading toward the 1000 percent mark,
(this year), is
killing old folks who are trapped, and on pension in
Zimbabwe. A loaf of
bread has just topped the $1000 mark. A great number of
pensioners have a
monthly income of just $2000.
Some are buying
petfood, and bread to survive. Even this is too expensive.
Most would
perish before asking for charity !
Did you know that ONE BRITISH POUND is
valued at Z$3500 and still climbing,
a US$ = $2500+, a NZ$= 1250, an AUSSIE $
= 1500, a RAND=$300, A PULA = $350
FOLKS, A SMALL POCKETFUL OF CHANGE CAN
MAKE A HUGE DIFFERENCE, PLEASE HELP !
A ZIMABWBE PENSIONERS TRUST has
been established ! The Trustees are all
based in Zimbabwe.
The
Pensioners Trust, administered by John Legat of Fleming, Martin
Asset
Management, now known as Imara Asset Management, other trustees are
Tony
Barfoot, formerly the Chief Executive of the Zimbabwe Stock Exchange,
John
Mc Phun, formerly Chief Executive of Marsh Insurance Brokers and
Marion
Futter, current chairperson of Fairways Homes.
FOR OUR PART WE
HAVE ESTABLISHED AN INTERNATIONAL TRUST ACCOUNT IN BOTSWANA
FOR SOUND
FINANCIAL REASONS. We hope this account will be filled by local
Zimwana's and
also provide a conduit for OFFSHORE contributions.
The local trust kindly
set-up for us by notable Zimbabweans, John Stevens,
Dave Fricker, Doc O
Connor (Deloittes & Touche) is known as the "DELOITTE &
TOUCHE
ZIMBABWE FUND".
Local ZIMWANA'S can send cheques made out to the fund,
and POST them to me
Mr C J Bradshaw , P Bag SK 14 , GABORONE , BOTSWANA, or
hand in to myself
or Dave Stone of African Banking Corporation Gaborone for
banking.
We intend to document every contribution, most importantly to
ACKNOWLEDGE
each individual who makes the effort. Through a regular
newsletter I will
keep you informed of the fund balance and how it is being
used for good.
FOREIGN transfers are also welcome and the account details
are :
DELOITTE AND TOUCHE ZIMBABWE FUND, C/O FIRST NATIONAL BANK, MAIN
MALL
BRANCH, ACCOUNT NUMBER: 62055647344 BRANCH CODE 282867, SWIFT CODE
FIRNBWGXA
e mail us to advise details of your transfer, Date, Amount,
Origin.
PLEASE HELP !
Please e mail me as above or Dave Stone at
dstone@africanbankingcorp.com
if
you have any queries or want to make any comments.
Thank-you in
advance on behalf of so many old folk who really need your help
but are too
proud to ask !