The Zimbabwe Situation

Our thoughts and prayers are with Zimbabwe
- may peace, truth and justice prevail.

Government to extend powers of detention
Zimbabwean govt. has no mercy on corruptionists: official
The perils of opposing Mugabe
Africa's Black Rhino Seen on Road to Recovery
Strangling Democracy
JAG Job Opportunities
MPs rebuff Mugabe
Ministers searched at meetings
Divisions in MDC suck in SWAPO
MDC in 11th-hour cleansing exercise
Dismay at govt's Big Brother act
Police probe govt support for Mawere's companies
Chombo takes aim at Byo mayor
In pursuit of the diaspora dollar
UK mulls tighter sanctions against Zim
Cost of mismanagement
...and now to the Notebook
Racism: an excuse for Africa's new tyrants
NRZ seeks US$208 mln offshore
Efficiency of financial regulation in Zimbabwe
Mbeki leads everyone down the garden path
Farm leases may be illegal

SABC

Zimbabwean govt to extend powers of detention

June 24, 2004, 05:40

The Zimbabwean government is introducing laws to extend already sweeping
powers of detention for people suspected of state security crimes as well as
economic crimes.

The legislation, if passed, will also stop journalists who violate state
press gag laws from working. The state-controlled daily Herald reports that
the bill will allow police to hold people accused of a wide range of
offences for three weeks without bail.

Current law demands that suspects have to be taken before a court after 48
hours. The opposition Movement for Democratic Change says the proposed
legislation amounts to a serious erosion of freedom. - Sapa

Back to the Top
Back to Index

Xinhua

      Zimbabwean govt. has no mercy on corruptionists: official

      www.chinaview.cn 2004-06-24 06:12:43

          HARARE, June 23 (Xinhuanet) -- Zimbabwean Minister of
Anti-Corruption and Anti-Monopolies Didymus Mutasa said on Wednesday that
Zimbabwean government will not be merciful on those involved in corruption
and economic crimes.

          Speaking at a one-day seminar on anti-corruption for top company
officials, he said proper procedures would be strictly followed in the
prosecution of people involved in corruption and fraud.

          The Zimbabwean government launched an anti-corruption drive at the
beginning of the year, in which several top business executives and
government officials have been caught."Dockets, once completed, will be
forwarded to the Attorney General's Office in the normal manner," he said.

          He said his ministry would work with the police and othere conomic
supervisory agents of government to ensure that corruption cases referred to
them were thoroughly investigated.The minister said the government was
determined not only to reduce corruption but to stamp it out completely.He
said there was also political will to fight corruption and fraud that was
threatening to destroy the economy and social fabric of the Zimbabwean
society.

          "The political will to fight corruption has seen the government
signing the Southern Africa Development Community Anti-Corruption Protocol,
which we are in the process of ratifying, and the United Nations Convention
on Corruption which we will soon also sign,"said Mutasa.

          He said there would also be no discrimination in the fightagainst
corruption as everyone involved in the practice would be investigated and
brought to book.

          Corruption, he said, was a developmental and governance
issue,which called for everyone's cooperation. Enditem

Back to the Top
Back to Index

BBC

The perils of opposing Mugabe

By Alastair Leithead
BBC, Zimbabwe

A secret location outside Bulawayo was where we met the latest victim of political violence in Zimbabwe.

The opposition say they are in constant fear of attack

The opposition Movement for Democratic Change youth leader spoke slowly and deliberately through his broken jaw about how he was beaten and tortured just for supporting the wrong party.

His jaw is broken in two places, his hand still terribly swollen and on his back a mark from where he was beaten with a belt - the buckle as clear as if someone had traced a marker pen around it and filled it in with bruising.

His injuries were two weeks old when I saw them.

"I was attacked by 25 war vets from Zanu-PF, who said I was an opposition youth ringleader so they wanted to get rid of me by eliminating me," he said.

It's a familiar story - of those brave enough to stand up and campaign, or even just support the opposition in Zimbabwe.

"Within a flash they started assaulting me. They beat me very hard. I think the main reason is that I support the opposition."

Firing line

He was attacked after the Lupane by-election in May was won by the ruling Zanu-PF party.

President Robert Mugabe
Mugabe points the finger of blame at a western plot
The area is an MDC heartland; those here hate President Robert Mugabe because of what he did to the people of Matabeleland in the 1980s.

Thousands were killed by his specially trained soldiers, to quash opposition and ensure one-party rule.

Today no-one who opposes the government is safe, and that puts opposition MPs directly in the firing line.

Electric shock

The Zimbabwe Institute, a think-tank based in South Africa, has launched a report detailing the human rights abuses opposition MPs have suffered.

Fifty were questioned - that's 80% of all opposition members of parliament - and the report shows all of them have suffered some form of abuse or intimidation.

The main aim was for us to beat people who supported the MDC

Youth camp graduate
"More than a third have survived assassination attempts, others have had family members beaten to death and killed," said Shari Eppel, a human rights campaigner based in Zimbabwe.

"There have been policemen torturing members of parliament - including electric shock treatment.

"This has got to be one of the few countries in the world that allows the opposition into parliament and then tortures them and refuses to prosecute those responsible - even when they are extremely well known," she said. Shari Eppel believes there is now less violence - other methods are being pursued as the threat of violence is enough to persuade people to vote Zanu-PF.

'Green bombers'

"The MDC won the by-election in Lupane, but the ruling party is using tactics which made a difference," said the MDC's unsuccessful candidate, Njabuliso Mguni.

"We had war-vets disrupting our meetings and we were getting no assistance from the police. The war vets were getting money to go and intimidate people - others were being bussed in to vote from other areas. When Zanu-PF had political meetings people were forced to go."

And many are afraid that the youth camps, disguised as training areas for national service, are brainwashing a generation and creating a militia of so-called "green bombers" because of their military fatigues.

A 20-year-old I spoke to was forced to go to a camp, afraid he would not be able to get a job, or that his parents would be tortured if he did not take national service.

"The main aim was for us to beat people who supported the MDC - the opposition party. We were also told to kidnap people for the camps - people of our age."

In the Lupane by-election there was also evidence that chiefs (traditional leaders ) were being used to compile lists of voters and to urge them to vote the right way.

Electoral reform

Lists mean a lot to the people of Matabeleland - in the 1980s those on lists were hunted down and killed.

The ruling party denies the political violence and some say it might recede ahead of next year's poll.

Critics says it may be able to ensure victory because of its control over the voters' roll.

Counting votes
The MDC says the polls are rigged long before counting
The MDC is banned from access to the roll and that leaves the door open to political fraud, they argue.

The opposition has demands for electoral reform ahead of parliamentary elections next March and insists these must be met if they are to take part.

It's a difficult decision - to take part in an election with a disadvantage and be well beaten, or withdraw from the democratic system altogether.

Back to the Top
Back to Index

Reuters

Africa's Black Rhino Seen on Road to Recovery
Thu 24 June, 2004 03:17

By Ed Stoddard

JOHANNESBURG (Reuters) - Africa's black rhino has been snatched from the
brink of extinction and its numbers are on the rebound, but the lumbering
beast still faces many threats, conservationists said on Thursday.

"Africa's critically endangered black rhinoceros could be on its way to
recovery if present trends continue," The World Conservation Union (IUCN)
and WWF International said as they unveiled new estimates from the African
Rhino Specialist Group.

Demand for rhino horn in East Asia, where it is valued for medical purposes,
and in the Middle East, where it is used in dagger handles, left a bloody
trail of dead rhinos in its wake.

Rampant poaching drove black rhino numbers down to around 2,400 in the
mid-1990s from an estimated 65,000 just two decades before. Poachers
typically hack off the horns and leave the hulking carcasses to rot under
the African sun.

"The latest findings show black rhino numbers have increased to just over
3,600, a rise of 500 over the last two years," Swiss-based IUCN and WWF
said.

Better law enforcement and an increase in the amount of protected habitat,
notably in South Africa where landowners are converting farms into private
nature reserves, are reasons that have been given for the rise in numbers.

"The ability to engage the private sector has been very helpful... In South
Africa, private land owners are buying black rhinos as an asset," Dr. Sue
Mainka, the head of IUCN's species program, told Reuters by telephone.

The conservation bodies made no mention of black rhino numbers in Zimbabwe,
where environmentalists have sounded the alarm about an upsurge of poaching
amid lawlessness and a crumbling economy.

The black rhino is following a comeback path blazed by its bigger cousin the
white rhino, which is the world's second largest land mammal.

The southern white rhino population, down to just 50 individuals a century
ago, now stands at 11,000.

Both animals are in fact gray in color.

The outlook for two other African sub-species of rhino is far more bleak,
the IUCN and WWF said.

The northern white rhino has been reduced to a single, small population of
just over 20 animals in the anarchic Democratic Republic of Congo, and could
soon be wiped out altogether by Sudanese poachers.

In Cameroon, the western black rhino may be in an even worse state with only
a few animals scattered widely.

"Illegal demand for horn, high unemployment, poverty, demand for land, wars,
the ready availability of arms and internal instability ... pose a threat to
rhino populations," said Taye Teferi, WWF's African Rhino Coordinator.

Back to the Top
Back to Index

New York Times

Strangling Democracy
By VACLAV HAVEL

Published: June 24, 2004

RAGUE

Last month the Czech Republic joined the European Union. Our country now has
the same democratic principles and freedoms, brought here by the "velvet
revolution" 15 years ago, as the community of nations that was built on the
basis of respect for these values. This transition to democracy in Central
and Eastern Europe, the outcome of a wider movement against totalitarianism,
would never have succeeded without the support of a democratically minded
world public.

Just five years after the changes that led to a new Europe, democracy made
another huge step forward in South Africa. Under the leadership of Nelson
Mandela and F. W. de Klerk, the apartheid regime was defeated. Two months
ago the world celebrated the 10th anniversary of South African democracy -
and South African democracy, like Czech and Slovak democracy, is of utmost
importance to other countries of the region. The ideal of freedom must
remain an inspiration and motivation for those fighting for human rights in
Zimbabwe.

I can still remember vividly what it is like to live in a country where a
party controlled by a politburo rules, where basic human rights and civil
freedoms are trampled on, where public discourse is controlled by ideology
that is expediently explained and applied by the chosen few. The state
controls everything, even citizens' private lives. Opposition is suppressed
or criminalized. Freedom of speech is seriously curtailed or nonexistent.

These feelings, however, do not exist merely in my memory. Much to my
regret, they are a living reality in various parts of the world.

Zimbabwe's leaders know that the international community will cooperate with
them only if they meet certain conditions. That is why they are trying to
give the impression of democracy and thus escape international isolation,
and why they distort the standard democratic mechanisms in order to create a
semblance of citizens' participation. At the same time, they create legal
instruments that violate human rights. Democratic institutions are partly
controlled by the leadership, partly circumvented by it.

A report published this year by the International Crisis Group, an
international nonprofit group that works to resolve conflict, showed that
many opposition members of Parliament in Zimbabwe have been subject to
murder attempts, torture, assault and arrest. In parliamentary elections,
President Robert Mugabe nominates 20 percent of members, who then become
parliamentarians without a democratic mandate. Elections are regularly
accompanied by organized violence and intimidation. The independent
judiciary, one of the pillars of democracy, has been severely compromised,
with the benches packed with Mr. Mugabe's supporters.

A law adopted before the presidential elections in 2002 requires journalists
to provide detailed information about themselves. If they do not, they will
not receive a journalist license. The law, called the Access to Information
and Protection of Privacy Act, has been used to close Zimbabwe's only
independent daily newspaper and to arrest people for "suspicion of
journalism." The state now claims a virtual monopoly of written and
broadcast media; foreign correspondents, meanwhile, are a thing of the past.

Another law restricts the freedom of association. The government in Zimbabwe
has used this law, called the Public Order and Security Act, to stamp out
any form of protest, to block practically any public activity of opposition
groups. Under this law, women have been arrested for giving out flowers on
Valentine's Day.

The Orwellian names of these laws are both chilling and relevant.
Totalitarian regimes may differ in small details - by the nature of their
deviations, the degree of their representatives' contrivance, the degree of
their cruelty and brutality - but their nature is the same. And so is the
manner of resisting such regimes.

Like Archbishop Desmond Tutu, I have been shocked and saddened to see the
decline of the once prosperous and democratic country of Zimbabwe, where
millions of people now depend on international food aid. The country, Mr.
Tutu has said, is now a shadow of what it used to be. My hope for Zimbabwe
is that one day it will drive away the shadows and return to the community
of democratic nations.

Vaclav Havel was president of Czechoslovakia and later the Czech Republic
from 1989 to 2003.

Back to the Top
Back to Index

JOB OPPORTUNITIES: Updated 23rd June 2004

Please send any job opportunities for publication in this newsletter to:
JAG Job Opportunities <justice@telco.co.zw>

--------------------------------------------------------------------------
1. Advert Received 1st June 2004
BLACKFORDBY AGRICULTURAL INSTITUTE

We require staff for the following positions at Klein Kopjes Farm,
Concession with substantial housing, attractive salaries and generous
benefits:

POST 1

Graduate in Agriculture to lecture in Crop Husbandry, preferably with
particular strengths in tobacco agronomy and production.

POST 2

Graduate in Animal Husbandry/Science to lecture and instruct students.
POST 3

Lecturer/Instructor in Farm Machinery and Engineering. All qualified
persons will be considered but practical experience will be of great
benefit.

An additional vacancy exists for a secretary/typist, who could ideally be
the wife or partner of one of the above posts.

A full range of sporting facilities is available on Klein Kopjes Farm. i.e.
squash, tennis, snooker, fishing, walking - everything for rural living.

All vacancies need to be filled as soon as possible.

Please forward applications as Post 1, Post 2, Post 3 to this address for
attention of Mr E M Kok,
or contact by phone 075-2532/2533/2932, fax 075-2539 for an appointment for
an interview.
Mr Kok may also be contacted on 04-499537 or 091-317523

---------------------------------------------------------------------------

2. Advert Received 2nd June 2004

Youngman aged 27yrs looking for a vacancy as a Bookkeeper/Accountant,
currently working as The Head Of Accounts Dept contact Oudy 023 243 352

---------------------------------------------------------------------------

3. Advert Received 4th June 2004

DEPUTY MANAGER- EXPORT ORIENTED FOOD PROCESSING/SPECIALISED AGRICULTURE.
The company, based in Harare, processes organic (certified to EU standards)
foods for export and local markets, and grows some of its organic inputs
directly, with some produced regionally on contract..
We are looking for a competent person, preferably but not necessarily with
experience in food processing and farming/horticulture, to manage the
business on an initial 3 month contract during the temporary absence of the
Manager.
For more details, contact us on fsfoods@zol.co.zw

---------------------------------------------------------------------------

4. Advert Received 7th June 2004

The Indigo Tree is looking for a part time lady for one of our shops.
We need a lady who is computer literate.
Pleasant surroundings and no parking problems.
Please contact Molley on the following numbers :
Work: 487224/5
Cell: 011 201 308.

---------------------------------------------------------------------------

5. Advert Received 10th June 2004

WANTED: Bookkeeper up to trial balance. Mornings only.
Please email to bolton@rdmarket.co.zw or call 091252 728
for an interview.

--------------------------------------------------------------------------
6. Advert received 12 June 2004
We require a special Sales Lady for exclusive gift shop in Avondale area
Must be well groomed and spoken.
Contact Irene 091321512
---------------------------------------------------------------------------
7. VACANCY WITH TOP SAFARI COMPANY IN BOTSWANA

We are urgently looking to fill the position of Front of House Manager
(FOHM) that has arisen within our Safari Company. This is a key position
within the Company as the FOHM manages our Guest's experience and must be
able to ensure that the high standards of the Company are met. This is a
very demanding position and requires someone who has great people skills,
is
very organised, has an eye for detail and the ability to delegate and
organise the tent, waiters and kitchen staff. The FOHM is also responsible
for checking the standards of the meals prepared for Guests.
Please would interested candidates contact:-

The Operations Manager
Box 173
Francistown
Botswana

Telephone:- 267 2412277
Fax:- 267 2413458

email:- sheila@unchartedafrica.co.bw
-------------------------------------------------------------------------
8. Advert received 20 June 2004

Lady assistant required to help out in upmarket clothing and sundry outlet,
must have some office skills to run petty cash, stock etc and enjoy working
with the public. Avondale area, 9-5pm five and a half day a week. Tel
Linda 091321640 or evenings 251377
-------------------------------------------------------------------------
9 Received 18 June 2004

Looking for work Mornings only - Secretarial., done Solution 6 accounting
package, honest, reliable, willing to do anything. Own transport.

Contact phone 333337. Myra Stidolph.
--------------------------------------------------------------------------
10. Received 13 June 2004

Workshop manager looking for a position - contact Graham at
bushbeans@zol.co.zw
---------------------------------------------------------------------------
11. Received 11 June 2004

Man aged 30 years looking for vacancy as a Storekeeper/Buyer, has good
qualifications and is currently working as a Chief Storekeeper. Contact
Fidelis on following numbers 301001/3, 301985/7/8
---------------------------------------------------------------------------
For the latest listings of accommodation available for farmers, contact
justiceforagriculture@zol.co.zw
---------------------------------------------------------------------------
THE JAG TEAM

JAG Hotlines:
(011) 612 595 If you are in trouble or need advice,
(011) 205 374
(011) 863 354 please don't hesitate to contact us -
(011) 431 068
we're here to help!
263 4 799 410 Office Lines

Back to the Top
Back to Index

FinGaz

      MPs rebuff Mugabe

      Hama Saburi
      6/24/2004 7:28:16 AM (GMT +2)

      IN what could be a decisive rupture with tradition, ruling ZANU PF
legislators sang from the same song sheet with opposition Members of
Parliament (MPs), when they united to shoot down the draconian anti-graft
laws introduced by President Robert Mugabe in February this year.

      In an unprecedented move, the ZANU PF legislators, known to rubber
stamp anything, walked out of Parliament on Tuesday, leaving Movement for
Democratic Change (MDC) MPs seated in the august House.

      The rare show, which was instigated by Gutu South legislator Shuvai
Mahofa and got the backing of ZANU PF young turks, namely Mashonaland West
chairman Philip Chiyangwa, Victor Chitongo (Murewa North) and Pearson
Mbalekwa (Zvishavane), among other legislators, was in protest against the
Criminal Procedure and Evidence Bill, which was scheduled to be voted into
law on Tuesday.

      Leader of the House and Justice, Legal and Parliamentary Affairs
Minister Patrick Chinamasa, who presented the Bill, was forced to adjourn
Parliament on noting that the ruling party, which always takes advantage of
its numerical advantage, did not have the numbers to push it through.

      Had the House been divided after the ZANU PF MPs had walked out, MDC
MPs could have shot it down, something that would have put spanners in the
ruling party's works.

      Critics have accused the government of using the anti-graft crusade as
a campaign gimmick ahead of the 2005 parliamentary election in which it
faces another stiff challenge from the MDC.

      The government insists that the crusade will be taken to its full
expression and no one will be spared irrespective of status. Critics however
remain largely sceptical.

      The shooting down of the Bill came shortly before an extraordinary
meeting of ZANU PF's supreme decision-making body, the politburo, slated for
tomorrow, which will discuss the outcome of investigations into a swathe of
party companies.

      There are heightened fears in ZANU PF that the Bill could be used not
only to punish those who would be found to be on the wrong side of the law
but also to settle political scores as the succession race gathers momentum.

      The controversial Bill extends the period of pre-trial detention
without possibility of bail for certain serious offences such as corruption,
money laundering, externalisation of foreign currency and unauthorised
disposal and dealing in gold or precious stones from seven to 21 days.

      According to the Bill, a judge or magistrate should not decline a
police request for further detention of a person accused of corruption. And
during that extension, no bail would be allowed for at least seven days.

      Under the proposed new law, therefore, an accused person can be
detained for up to 30 days if the police insist they want to continue with
investigations.

      Lawyers have described the sweeping anti-graft regulations as
unconstitutional and a violation of basic human rights. President Mugabe,
80, used his constitutional powers to introduce the Bill, which expires
after six months unless it is approved into law.

      Immediately after its introduction, prominent businessman and ZANU PF
central committee member James Makamba became the first victim. Makamba was
thrown behind bars in February and is still to taste freedom.

      Finance Minister Christopher Kuruneri is another top ZANU PF official
still battling to secure his release from police custody after being
arrested in April and charged with three counts of externalising foreign
currency and two counts of breaching the Citizenship Act.

      A ZANU PF caucus convened yesterday morning to discuss the impasse
agreed that the Bill was fraught with inconsistencies and problems that
could split the ruling party right through the middle.

      The caucus agreed to set up a committee to investigate allegations
that senior government officials, the police and some officers from the
Attorney-General (AG)'s Office had abused the Bill by accepting bribes from
business people caught up in the anti-corruption net.

      Chinamasa was tasked to immediately amend the Bill to rid it of
aspects that have created discord within the ruling party's ranks. An
amended Bill will be presented to another ZANU PF caucus on Wednesday at
9:15am and once approved, it would be discussed in Parliament at 2:15pm.

      It was also discussed during the meeting that the amended Bill should
ensure that the police do not rush to arrest unless it is with the
concurrence of the AG's Office.

      Whistle blowers who provide information that turns out to be false
should be penalised to discourage instances where people blow the whistle
for the sake of settling personal scores, it was suggested.

      Contacted for comment, ZANU PF chief whip Ray Kaukonde confirmed the
walkout by the ruling party legislators on Tuesday, but referred all
questions to the leader of the House, Chinamasa.

      Chinamasa said the areas of concern to the ZANU PF MPs were being
looked into.

      "There was no hiccup. We held a caucus meeting today and resolved to
further strengthen the Bill. The matter is coming back next week Tuesday. I
am going to look into those areas."

      Sources said it all started when Mahofa went to Speaker of Parliament
Emmerson Mnangagwa's chair and immediately after a tete-a-tete with the
party's secretary for administration, Mahofa had discussions with individual
MPs.

      "Whether it was by coincidence or not, soon after the discussions,
ZANU PF MPs started walking out of the House," said one source.

      Mahofa queried why no white people and MDC members had been arrested
ever since the crackdown on corrupt people started.

      Sources said there was an imminent threat of a split within ZANU PF if
the issue was not handled properly, with party cadres from the Midlands
province feeling they had been treated unfairly by party bigwigs from
Mashonaland provinces.

Back to the Top
Back to Index

FinGaz

      Ministers searched at meetings

      Brian Mangwende
      6/24/2004 7:28:41 AM (GMT +2)

      THE increasingly cryptic ZANU PF succession conundrum has taken
another mysterious turn as it emerged that President Robert Mugabe now
distrusts some of his lieutenants, who are now being frisked for electronic
devices before politburo and Cabinet meetings.

      Politburo meetings are held at ZANU PF's party headquarters in Harare
while the Cabinet meets at Munhumutapa Building, also in the capital.

      Reports of the searches, emanating from the ruling party's inner
circle, have been widely interpreted to mean that the 80-year-old President
Mugabe is increasingly getting paranoid.

      The President, who has led Zimbabwe since independence from Britain in
1980, has since indicated he is seeing out his last term in office.

      Impeccable sources said the move comes against the backdrop of
accusations and counter-accusations by senior members of the party over the
leakage of sensitive information - verbatim - to the local and regional
press with a view to discrediting certain individuals whose names have been
thrown up as President Mugabe's possible successors.

      Suspicion has manifested itself within the party ahead of its crucial
congress slated for December.

      President Mugabe, an object of attacks from Western and European
governments over his style of governance, recently announced what critics
said amounted to a distant departure date -2008.

      This was widely seen as an attempt to patch up cracks emerging within
the ruling party over the emotive succession issue.

      Lack of trust and cohesion, the sources said, had prompted the new
developments as senior party members were now going for each other's throat
by whatever means possible, including using the local and international
media at a time when the government was at pains to spruce up the country's
political image.

      "Cabinet ministers and politburo members are now subjected to thorough
searches when they go for meetings," one source said.

      "The reason being that some people go for meetings with agendas
different from the rest. Gadgets that record proceedings are no longer
allowed because it is that information that is later published in various
newspapers.

      "These meetings are supposed to be confidential, but you see some very
delicate information being splashed in newspapers, even abroad," the source
added.

      Another party insider said there was nothing amiss about not entering
Cabinet meetings without electronic gadgets such as cell phones with camera
facilities.

      In fact, the source said, it was general practice that people were
searched at the buildings in question, including senior party officials.

      "It's normal for security reasons," the source said. "Unless those
complaining are unaware of the security measures which have always been in
place."

      Contacted for comment, Minister of State for National Security in the
President's Office Nicholas Goche gave a belligerent response.

      "What has that got to do with you and your paper? Has anyone come to
complain about that to you?" an audibly agitated Goche charged.

      As this reporter continued questioning, he ducked and repeated: "I
said tell me whether anyone has come to complain, tell me. I want to know
whether anyone has come to complain to you. Stupid!"

      Goche, who is also the Member of Parliament for Shamva, then switched
off his mobile phone.

      Of late, relative ruling party newcomers and the so-called "young
turks" in ZANU PF and the government have clashed with the old guard over
various issues without regard to party protocol and suffering no apparent
reprisals.

      This is reported to be bothering the rank and file of the ruling party
and has at the same time raised questions as to the source of their bravado.

      Political squabbles within ZANU PF have spilled into the public domain
as senior party members openly attack each other in the media.
Traditionally, this has been done in dark rooms at the party's headquarters.

      But now the disputes between party stalwarts are being played out in
the public media, a development without precedence in ZANU PF, which has
long projected a façade of harmony, with rifts rarely admitted over any
issue.

      The state's own paranoia has also heightened ahead of next year's
parliamentary election and only last month, the government, through Tel*One,
proposed new contracts for all Internet service providers compelling them to
intercept e-mail content or report messages perceived to be politically
incorrect.

      This has been slammed as another desperate bid to control the flow of
information in the country by a government that has enacted laws that have
put two newspapers out of business.

      However, the move hit a brick wall because the government had not
anticipated the kind of wizardry involved in that technological sphere.

Back to the Top
Back to Index

FinGaz

      Divisions in MDC suck in SWAPO

      Brian Mangwende
      6/24/2004 7:30:46 AM (GMT +2)

      THE Movement for Democratic Change (MDC) could be spoiling for another
regional brawl - this time with Namibia - after sharp differences within the
Morgan Tsvangirai-led party sucked in Sam Nujoma's SWAPO.

      This comes amid reports that the MDC's security chief, Tichaona
Mudzingwa, has allegedly accused Namiba's ruling nationalists of bankrolling
the opposition party's members to cause internal divisions.

      Recently, a diplomatic row erupted between the MDC and South Africa
after the former instituted legal action against President Thabo Mbeki to
compel him to produce documentation compiled by two South African judges who
monitored the disputed 2002 presidential election.

      The increasingly litigious MDC, however, immediately withdrew its case
as soon as its intentions spilled into the public domain.

      Accusations against SWAPO, a liberation movement-turned-political
party with strong ties with the ruling ZANU PF, came to light just before
the hearing of MDC suspended national chairman for fund-raising in the youth
assembly, Charlton Hwende, kicked off. Hwende is facing three charges of
misconduct involving disrespecting party rules.

      Party sources said Hwende asked the disciplinary committee, chaired by
MDC vice president Gibson Sibanda, to exclude Mudzingwa from the proceedings
on the grounds that he had pre-conceived motives against him. Hwende
confirmed the hearing took place.

      Hwende, the sources said, told the committee that Mudzingwa, initially
part of the disciplinary team, should recuse himself because he had compiled
a document accusing him (Hwende) among others of being funded by SWAPO
through Zimbabwe's dreaded spy agency, the Central Intelligence Organisation
(CIO) to travel to Namibia on secret political trips. Upon return, it was
alleged, Hwende would scuttle efforts by the MDC to consolidate its position
and gain more ground by causing confusion in the party.

      The sources claimed that following the revelations, Mudzingwa was
immediately ejected from the hearing to pave way for smooth proceedings.

      "Hwende told the hearing that Mudzingwa had compiled a false document
against him accusing him of receiving funds from SWAPO through the Central
Intelligence Organisation to facilitate his trips to and from Namibia, come
back and cause confusion in the MDC," the source said. "Mudzingwa also
claimed that Hwende had received various amounts of money from the CIO to
campaign in Zengeza. Mudzingwa was then asked to leave the hearing."

      MDC spokesperson Paul Themba Nyathi said: "The hearing was held and
Mudzingwa recused himself voluntarily because his department had written a
report on Hwende. The discussion went smoothly and ended amicably. However,
on the accusations involving SWAPO, that is a matter between the security
department and the person concerned. I am not aware of the contents of the
document."

      Hamanyera Hambyuka, an official in the office of the secretary general
of SWAPO, said he was unaware of the development, but would check with his
superiors.

      Speaking from SWAPO's party regional headquarters in Windhoek,
Namibia, Hambyuka said: "I am not aware of that arrangement. Those rumours
are unfounded, but I'll make a follow-up with the secretary general and find
out what could be going on if there is any truth to that."

      Allegations against Hwende arose from an affidavit he reportedly
wrote, through advocate Charles Selemani, to the party accusing the
controversial MDC national chairman, Isaac Matongo, of breaching party
procedures.

      On the second charge, Hwende was accused of denying writing the
affidavit in question. He was also charged with speaking to the media, in
particular The Financial Gazette without prior permission from the party.

Back to the Top
Back to Index

FinGaz

      MDC in 11th-hour cleansing exercise

      Brian Mangwende
      6/24/2004 7:31:56 AM (GMT +2)

      AFTER unsubstantiated allegations of infiltration by ZANU PF, Zimbabwe
's biggest opposition political party, the Movement for Democratic Change
(MDC), has embarked on an eleventh-hour self-cleansing exercise as it girds
its loins for the popular mandate to rule the country at the next
parliamentary poll.

      Zimbabwe's next parliamentary election, which pits Morgan Tsvangirai's
MDC and President Robert Mugabe's ZANU PF, is slated for March 2005.

      The MDC has been hoping to exploit voter anger and fear of deprivation
in the face of faltering economic fortunes while ZANU PF, which has ruled
Zimbabwe since independence in 1980, hopes to exploit the power of
incumbency.

      The two parties have over the last two years half-heartedly tried, at
the instigation of mainly South Africa and Nigeria, to have a negotiated
settlement to Zimbabwe's political crisis. The talks however drew a blank.

      The opposition party's belated vetting exercise will be done at
district level. The MDC, from which there has been a chorus of angry voices
over the government's refusal to reform the country's electoral laws, will
use the exercise to identify fully subscribed and bona fide members of the
party.

      The exercise comes four years after the MDC's historic launch in 1999
at Rufaro Stadium in Harare.

      Observers this week said the timing of the purification exercise was
puzzling given that the party could have immediately transformed itself from
a mass movement that could easily be infiltrated into a political party with
foolproof safeguards soon after the 2000 parliamentary election.

      The MDC's eleventh-hour action has prompted some observers to conclude
that the exercise was in response to alleged divisive infighting in the
party, which has since created panic stations within the leadership.

      Among other issues, cracks have emerged within the opposition party
over candidates for parliamentary by-elections and whether or not it should
participate in the 2005 poll.

      The observers, however, warned that the self-cleansing, while
essential given the acrimonious wrangling, could widen the divisions within
the party founded as a loose coalition of civic society, labour and numerous
other interest groups.

      "The MDC should have by now transformed into a political party and
this process should have been done a long time ago," said political analyst
Alois Masepe.

      "It may be necessary, but it's too late in the game. It's dangerous
because the process could indeed split the party as members will be
jockeying and rallying behind their candidates. It's absolutely dangerous to
embark on that exercise now ahead of crucial elections.

      "This might spell disaster for the MDC, but it's necessary that they
do it. Already conflicts have emerged, which is necessary, but they have to
be contained," he added.

      Chairman of the Department of Political and Administrative Studies at
the University of Zimbabwe Eldred Masunungure said it was a positive
development. It must have come out of the realisation that there were a lot
of gatecrashers in the 2000 parliamentary polls. The gatecrashers
contributed to the delinquency and current indiscipline within the MDC today
at all levels.

      "But for the exercise to bear fruit, it depends on the methodology
they'll use. The move is a positive one and it will strengthen the MDC
internally.

      "However, I do not think the process will have a big impact on next
year's elections because that is a constitutional issue and as long as the
playing field is not even, it's really not conducive to an MDC victory."

      The alleged internal squabbles saw the MDC's high echelons being
blamed for the party's shock defeat in a by-election in Zengeza.

      The wrangling has been worsened by reportedly sharp differences within
the party's national executive over fundamental party policies.

      Conflicting statements have been issued on the possibility of
boycotting next year's elections, with senior party members trading
accusations and counter-accusations over alleged flouting of basic party
procedures.

      It is also the inhouse fighting that led to the expulsion from the
party of former Highfield Member of Parliament Munyaradzi Gwisai in 2002 as
well as the resignation earlier this year of acting Harare mayor Sekesai
Makwavarara, widely seen as a ZANU PF plant.

      Three other MDC councillors in Harare have also since resigned.

      Brian Kagoro, chairman of Crisis Coalition, said if the process was
done purely through party structures, the MDC could become hostage to
accusations from its members. The scope had to be broadened, he said.

      "The MDC has to be very careful in that the process may split it
further. If a sitting candidate loses during the exercise and feels that the
process was flawed, then that candidate may decide to stand as an
independent, weakening the party," Kagoro said.

      "The timing is very important in a political game. This purification
exercise may have the potential of reducing the number of women
representatives because, given ZANU PF's aggression, the strategy has to be
somewhat radical, but this will breach provisions of the constitution about
the number of women representatives.

      "The MDC should avoid by all means a repeat of the Zengeza scenario if
it is serious. The idea should be to broaden the selection process and not
base it on individualism. They (MDC) need checklists on the aspects of the
failures of ZANU PF in primaries and simply do the opposite. The solution is
not to impose candidates."

      The MDC lost the Zengeza seat to ZANU PF amid reports that the
leadership had imposed James Makore as the official candidate in the
by-election that claimed one life.

      Under normal circumstances, candidates are selected through the local
partry structures at ward and district levels. They are nominated by
consensus, failing which primary elections are conducted.

Back to the Top
Back to Index

FinGaz

      Dismay at govt's Big Brother act

      Nelson Banya
      6/24/2004 7:33:22 AM (GMT +2)

      PLANS by the government to go ahead and exert control over the
Internet, particularly the usage of electronic mail (e-mail), has raised the
spectre of even more pervasive control on information by authorities who
have systematically assumed control on the flow of information in the
country.

      Although the Supreme Court ruled that plans to allow state agents to
pry on e-mails were unconstitutional, news doing the rounds is that the
government has pushed ahead with the cyber monitoring project through the
proposed new contracts reported to have been issued to Internet Service
Providers (ISPs), which would compel them to block material deemed to be
inimical to the laws of the country.

      ISPs have already signalled their desire to rebuff the government on
this, while lawyers and civic groups have reacted with alarm, saying the
plan was patently unconstitutional.

      Apart from ensuring that ISPs block what is perceived to be offensive
content infringing copyright, international and local cyber regulations, the
proposed contract also obliges ISPs to provide all tracing facilities of the
offending messages relayed through their networks to law enforcement agents
"in the interests of national security".

      Government first signalled its intentions to monitor the Internet at
last December's World Summit on the Information Society (WSIS) held in
Switzerland when President Robert Mugabe accused developed countries of
undermining the security and national interests of smaller, poor nations
through "information technology superiority".

      Harare has been waging a bitter diplomatic war with Washington and
London since the government embarked on controversial land reforms in 2000.

      The United States and the United Kingdom governments have accused the
Zimbabwean government of human rights abuses and undemocratic rule.

      Harare has, in turn, accused the two Western allies of seeking to
exert hegemonic influence on the former British colony using, among other
means, the Internet to peddle "violent propaganda and misinformation."

      The police last year arrested several people accused of circulating
offensive e-mails denigrating the President.

      Several websites on Zimbabwe have mushroomed over the past few years,
which range from those taking a straight-faced dim view on developments in
the country, to those steeped in satire and ridicule lampooning the
government, ruling party and President Mugabe himself.

      Observers have pointed out that while this was by no means restricted
to Zimbabwe, innovative Zimbabweans, who have witnessed the narrowing of
avenues through which their divergent views could be aired following the
closure of the hugely popular Daily News and the perpetuation o the Zimbabwe
Broadcasting Corporation's monopoly, have resorted to the worldwide web.

      Ironically, almost similar plans by the Bush administration in the US
to monitor e-mails, as part of the "War on Terror", were stymied by
Congress, which deemed such plans a direct assault on the fundamental rights
of citizens.

      How far the government will go in its quest to monitor the Internet,
whose usage among the young section of the Zimbabwean population has grown
in line with global trends, remains to be seen, but indications are that
ISPs are not about to lie down and accept the state lording it over them.

      An executive at one of the country's leading ISPs told The Financial
Gazette that the proposed contracts had unsettled a lot of account holders.

      "We will continue to meet as the Zimbabwe Internet Service Providers'
Association (ZIPSA) to engage the authorities, because a lot of this remains
unclear, even to us, and moreso to our clients," she said.

      George Jaji, an electronic engineer and IT specialist, said the fact
that TelOne, the government owned telecommunications company, operated the
sole Internet gateway in the country made it possible for the government to
exert its control.

      "ISPs are reluctant for two basic reasons, the first being the obvious
implications on the free flow of information and the second being that
government wants to pass the buck to ISPs who will have to install the
technology.

      "The ISPs would need to buy the technology as well as to train their
personnel to do business which is not core to their activities and does not
help their business in any way. The desire to control the flow of
information is archaic and has no place in modern society," Jaji said.

      The state-owned TelOne is at the centre of a legal battle over its
gateway monopoly, with several ISPs arguing that the monopoly is not only
unconstitutional but also anti-competitive, considering that the parastatal
also runs an ISP, ComOne, which stands to enjoy an unfair advantage by
virtue of that relationship.

      However, another IT specialist who spoke on condition of anonymity
said what the government sought to do was "virtually impossible considering
the volume of traffic as well as the software that would be required to
monitor the Internet."

      He said although content filters could be used to block messages
deemed derogatory, this too was problematic because filters were language
specific.

Back to the Top
Back to Index

FinGaz

      Police probe govt support for Mawere's companies

      Staff Reporter
      6/24/2004 7:29:45 AM (GMT +2)

      AS police in Harare intensify their investigations into the operations
of the businesses owned by the maverick Mutumwa Mawere, eyebrows have been
raised as to how the off-shore incorporated Africa Resources Limited (ARL)
enjoyed financial support from government.

      ARL is the vehicle Mawere, who the Zimbabwean authorities want
extradited from South Africa for allegedly violating the country's exchange
control regulations, used to acquire Shabanie and Mashaba Mines. He took
over the asbestos producers without immediately coughing up a dime in what
was then referred to as financial engineering.

      Impeccable sources yesterday said of interest to the police is how
ARL, which is said to be registered in the United States Virgin Islands, got
a US$60 million government guarantee in 1998 which helped it restructure its
short-term debt and provide for working capital.

      In December 2000, Shabanie and Mashaba Mines was also granted a US$60
million five-year pre-export finance facility supported by a Memorandum of
Deposit Arrangement through the Reserve Bank, which will expire on January
31 2007.

      Mawere was subsequently granted a seven-year privilege to market the
lucrative asbestos fibre without going through the Minerals Marketing
Corporation of Zimbabwe, which was later cancelled in March this year.

      The sources said ARL's favoured status smacked of influence-peddling
and back-scratching relationships known to exist between business people and
powerful civil servants and politicians.

      Although they could not say whether envelopes had been pushed too far,
police confirmed that they had intensified their investigations to unravel
the full story behind the government's financial support for ARL.

      While government has occasionally doled out large chunks of public
funds to troubled state-owned companies, it is extremely difficult, if not
impossible, for privately-owned companies to get financial backing from the
government. Even then some strategic public enterprises such the Cold
Storage Company, the National Railways of Zimbabwe and Air Zimbabwe are
reportedly teetering on the brink of collapse due to financial and
operational difficulties but government seems to be taking its time to come
to their rescue.

      Police spokesman Wayne Bvudzijena confirmed that ARL had come under
the force's watchful eye, but declined to disclose the nature of their probe
for fear of prejudicing the investigations, which critics say could have
been triggered by the fall-out between Mawere and named ZANU PF
heavyweights.

      "We have officers in South Africa doing part of the investigations,
but at the moment I cannot indicate whether we will be going to the Virgin
Islands because it depends on the amount of evidence we gather," said
Bvudzijena.

      Mawere is facing possible extradition to Zimbabwe on allegations of
fraud involving $300 billion and for contravening some sections of the
Exchange Control Act. June 29 has been set aside for his extradition
hearing.

      Mawere has indicated he holds a South African passport and has been
resident in that country for the past nine years. Through his ARL, Mawere
has invested in UKI Limited, African Associated Mines, SMM, Steelnet,
Turnall, General Beltings, FSI Holdings, First Banking Corporation and ZimRe
Holdings among others.

Back to the Top
Back to Index

FinGaz

      Chombo takes aim at Byo mayor

      Staff Reporter
      6/24/2004 7:31:15 AM (GMT +2)

      BULAWAYO - Local Government Minister Ignatius Chombo, whose
interference with the operations of the Harare City Council has almost
crippled the capital, seems to be heading for another showdown with the
Bulawayo City Council.

      Chombo, who was here last week ostensibly to commission Zimbabwe
United Passenger Company (Zupco) minibuses and to introduce the governor and
resident minister of Bulawayo, Cain Mathema, told residents that the man in
charge of the city was Mathema and not the mayor, Japhet Ndabeni-Ncube.

      He also told the residents that the government was freezing rates and
levy increases that were to be effected from July 1 until next year. The
mayor did not attend the meeting. Local media reports said this was an
indication that he did not care about the welfare of the residents.

      Ndabeni-Ncube, who was elected executive mayor in 2001 on a Movement
for Democratic Change ticket after beating ZANU PF candidate George Mlilo by
60 988 against 12 783 votes, said he was not disturbed by the minister's
sentiments that Mathema was in charge of Bulawayo because that was
inconsequential.

      "I didn't even think about it," he said.

      He, however, said the council was going ahead with the rate increases
because it had not received any directive from the government to freeze
them.

      "As far as I am concerned, this is just a rumour. Those rate increases
were gazetted by the government. We stand by that law. The minister has not
told us anything to the contrary," Ndabeni-Ncube said.

      The council's $180 billion budget was approved by the government in
April after a four-month delay. City treasurer Middleton Nyoni said the
delay had cost the council $3.6 billion in lost revenue. The government also
owed the council $4 billion in unpaid rates at the end of March.

      Asked whether the council's refusal to freeze the rate increases would
not be construed as defying the minister, the mayor said: "I am operating
within the provisions of the Urban Councils Act. I work for the government,
but there is a framework in which we operate. The minister is an overseer.
He is my minister and if he issues a directive I will comply, but I don't
act on hearsay."

      Town Clerk Moffat Ndlovu also said the council was not going to take
any action because the minister had not officially communicated with the
council.

      "We read about the so-called freeze in the paper. We cannot act on
press reports," he said.

      Ndabeni-Ncube denied reports that he had boycotted the residents'
meeting at which Chombo announced the freeze. He said he had not even been
invited to the meeting as it was a ZANU PF gathering. All 29 councillors in
Bulawayo belong to the MDC.

      "I did not attend because this was a ZANU PF meeting. On Thursday, we
had a small meeting to commission Zupco buses. I attended that meeting
because it was an official local government meeting," he said.

      "On Friday, the minister attended a meeting with residents organised
by Bura (Bulawayo United Residents Association). I did not attend this
meeting because it was a ZANU PF gathering," he said.

      Ironically, Harare provincial governor Witness Mangwende, who
accompanied Chombo, told the residents that he was in the city to learn
"from the best practices in management that have been synonymous with the
City of Bulawayo".

      Observers also questioned why Chombo was in the city because the Zupco
buses had already been commissioned in Harare, while Mathema was appointed
governor in February.

      "He probably just wants a travel and subsistence allowance," quipped
an observer at a function, which Mathema was supposed to officially open but
had to cancel because he was taking Chombo around.

Back to the Top
Back to Index

FinGaz

      In pursuit of the diaspora dollar

      Nelson Banya
      6/24/2004 7:30:18 AM (GMT +2)

      IF you can meet with triumph and disaster. And treat those two
imposters just the same. Then you are a man, my son . . . But make allowance
for their doubting too . . .

      The preceding verses, penned by the lionised British writer Rudyard
Kipling in his immortal poem IF, would aptly sum up the foray by Reserve
Bank of Zimbabwe (RBZ) governor, Gideon Gono, and his team into the
diaspora.

      Not least because the famous writer spent part of his life abroad (in
colonial India), but because the triumph and disaster were always distinctly
possible outcomes of the RBZ team's excursion to the United States, Britain
and South Africa.

      Gono himself indicated upon arrival that his entourage had met with
various stakeholders with interests in Zimbabwe.

      "Various financial institutions with interests in Zimbabwe, business
people and conglomerate investors, asset and fund managers were also engaged
in high-level meetings with the governor in Washington, London and
Johannesburg, with satisfactory outcomes.

      "Results of these initiatives should show themselves soon," Gono said.

      There were obvious successes recorded immediately, with the
communication of the Homelink money transfer system to non-resident
Zimbabweans and the registration of interest to invest in the country, being
top on this list.

      An RBZ statement released upon the team's return indicates that "as
much as US$135 million proposals for housing projects back home" had been
submitted by the non-residents.

      In the United Kingdom, commitments of projects ran up to as much as
800 000 pounds, with some 22 000 pounds having been collected from about 160
Zimbabweans.

      The Washington leg of the trip also saw Gono meeting senior officials
at the Bretton Woods institutions, the International Monetary Fund (IMF) and
the World Bank, as part of efforts to consolidate the nascent détente that
has been established between the monetary authorities in Harare and the
multilateral donor organisations, after a bitter fall-out with the
government.

      Gono's three-tiered mission was not without incident, though, as his
retinue encountered demonstrations in London and South Africa, with a vocal
section of the Zimbabwean population in those cities venting their anger
against the Harare government through Gono, who was perceived to be the
government's proxy.

      However, Gono evaded issues pertaining to human rights, the rule of
law and the disenfranchisement of the non-resident Zimbabweans in the last
presidential election, insisting that his mission was not political.

      Gono even referred to the South African incident where he was barred
by angry youths from addressing a gathering of an estimated 600
Zimbabweans - including professionals working in that country, businessmen
and academics, as "spicy" - a tongue-in-cheek reference to the food that was
looted by the marauding demonstrators who were reported to have pelted the
team, which included Zimbabwe's ambassador to Pretoria Simon Khaya Moyo,
with missiles.

      Far from being a laughing matter the incident, coming as it did at the
very end of Gono's trip, brought up, albeit in a reprehensible manner, the
concerns that have to be dealt with before all can be expected to buy into
the Homelink scheme which has gotten off to a start exceeding expectations.

      Although the jury might still be out on the success or lack thereof of
the RBZ foray into the diaspora, the Homelink publicity campaign, mounted by
none other than its chief architect Gono himself, is sure to bring positive
results.

      While the political undertones that have stalked virtually every
official Zimbabwean scheme since polarisation set into the country's body
politic four years ago can scarcely be dismissed (although the opposition
Movement for Democratic Change denies organising the London and Johannesburg
demonstrations, sceptics abound), it is apparent that the current turnaround
efforts will always have to live with the spectre of politics spoiling
everything.

      It is therefore imperative that the political crisis, basically the
standoff between the ruling party ZANU PF and the Movement for Democratic
Change should be immediately eased. They should come out of their trenches
and seek a negotiated settlement.

      Political analysts say chances of that happening are disappearing with
each passing day as the nation trudges, yet again, towards another divisive
election in March 2005.

      With nothing, therefore, expected to move forward on that front, it
therefore makes for an onerous task for Gono and his team at the central
bank and their colleagues in Treasury, to implement measures targeted at
arresting the economic malaise in an environment poisoned by politics.

      In the face of the disasters that await this course, even the
unrepenting critics of the current stabilisation programme being spearheaded
from the RBZ are beginning to come around to the realisation that amid the
disaster that has dragged the economy down to a 30 percent contraction in
four years, triumph was possible.

      The RBZ's inflation-busting efforts are a case in point.

      When Gono announced that the bank would be targeting annualised
inflation of between 170 percent and 200 percent by December 2004,
gainsayers pointed at the then levels of about 600 percent, indicating that
this was an unattainable target.

      Halfway into the year, the rate has declined from a high of 622.9
percent in January to 448.8 percent in May.

      Economic analysts and even the hard-to-please IMF have recently
announced that the target was well within sight.

      All in all, the RBZ officials' pilgrimage to Washington, London and
Johannesburg provided valuable lessons and an opportunity to interface with
important stakeholders, some of which are indispensable in the ongoing
efforts to extricate the country from the rut.

      The resolution and renewed confidence within the corridors of 50
Samora Machel Avenue, Harare persists despite the ever-present threat of
disaster, or the appearance of it.

      "Zimbabweans in the diaspora are convinced, just as we are, that we
are on the right track," Gono declared

Back to the Top
Back to Index

FinGaz

      UK mulls tighter sanctions against Zim

      Brian Mangwende
      6/24/2004 7:32:23 AM (GMT +2)

      THE United Kingdom, whose actions the government claims have been
suffused with arrogance instead of atonement for colonial sins committed in
the past, is reportedly mulling broadening sanctions against Zimbabwe.

      The UK claimed that it is considering tightening the screws on
Zimbabwe because President Robert Mugabe's government has failed to restore
the rule of law and is instead stifling democratic space.

      The former colonial master, which the Zimbabwean government claims
opposes President Mugabe not because of his undemocratic re-election tainted
by unfair campaigning and violence but because they want to get their man
in, has indicated that the issue of further sanctions against Zimbabwe would
be on the agenda next month in the House of Commons.

      That the UK would contemplate further sanctions against Zimbabwe was
foregone. The two countries have had a long-drawn diplomatic rift, which was
touched off when Zimbabwe embarked on its controversial land reform. The
rift widened after the disputed 2002 presidential elections won by President
Mugabe. Prior to the elections, the UK had not made secret its belief that
President Mugabe no longer enjoyed public confidence and a new man at the
helm would do better than the incumbent.

      The decision to broaden the targeted sanctions comes at a time when
there are questions over the efficacy of the so-called "smart sanctions",
mainly travel bans, imposed on ruling ZANU PF and government officials.

      If anything, the sanctions seem to have degenerated into a full-scale
trade embargo against the country, which has seen ordinary citizens being
the worst affected.

      Constitutional law expert and chairman of the National Constitutional
Assembly, Lovemore Madhuku, said: "Sanctions do not work in Zimbabwe. What
needs to be done is to encourage Zimbabweans to engage in programmes that
make the government accountable. Sanctions are simply not working in the
context of Zimbabwe. Sympathisers should support programmes by the media,
civic society and human rights organisations to educate the people that the
solution is to rise and change this dictatorship."

      Soon after the hotly contested presidential election in 2002, the
European Union, United States of America and Australia slapped the victor,
President Mugabe, members of his Cabinet and some senior ZANU PF officials
with "smart sanctions" at the instigation of Britain. The countries said
they had chosen the sanctions route because the 2002 presidential poll was
fraught with massive irregularities, violence and muzzling of the press.

      "I understand that there is indeed a lot of pressure in the House of
Commons to discuss Zimbabwe and add more people on its list of blacklisted
travellers," said Greg Linington, a constitutional lawyer in the Political
and Administrative Faculty at the University of Zimbabwe.

      "This is highly understandable, taking into consideration that the
country is not going back to basic democratic principles and adhering to the
rule of law. The move is regrettable, but necessary for sanity to prevail in
Zimbabwe."

      Asked whether the sanctions would go beyond adding another name on the
list, Linington said: "Oh yes. There is a possible difficulty in Zimbabwe
securing loans from internationally recognised financial institutions. Lines
of credit could be cut, if that already hasn't happened."

      Another political analyst, Heneri Dzinotyiwei, said: "As much as one
may not want to agree that sanctions imposed on Zimbabwe are hurting, the
perception created by the word itself is negative. It scares away possible
investors. It's a big deterrent. Adding one or more individuals onto the
list only impacts on those targeted people who want to visit Britain or
America for shopping and so on, but the broader picture is that we can't go
it alone. We have to address the issues that result in sanctions being
imposed on the country.

      "That Zimbabwe is back on track economically is all nothing but talk.
Inflation continues to rear its ugly head," Dzinotywei said.

      Asked what the impact of further sanctions would really mean,
Dzinotyiwei said: "Do we really want to be an isolated country. Although, we
don't have to beg for assistance we can't continue living like an island. We
have a bigger challenge to address and that is how to come to terms with
reality."

      Peter Hain, the leader of the House of Commons, was quoted as having
said he had been pressurised to put Zimbabwe on next month's agenda with a
view to looking into possible further sanctions against President Mugabe and
his close clique.

      Said Hain: "On Zimbabwe, I freely acknowledge that the Hon. Gentleman,
and others on both sides of the House, have been pressing me on the matter.

      I am pleased that we are having a debate about it, which will present
an opportunity to send a message to President Robert Mugabe about what the
House thinks of his despotic rule."

      The government has since said it would respond accordingly to any
action by the House of Commons, adding that it had since ceased being a
member of the Commonwealth.

Back to the Top
Back to Index

FinGaz

Comment

      Cost of mismanagement

      6/24/2004 8:15:32 AM (GMT +2)

      AS widely expected, Parliament has nodded through the Bill that seeks
to rid the Zimbabwe Broadcasting Corporation (ZBC) of its mountain of
swingeing debts running into several billions of dollars.

      Now, that the public broadcaster is in a debt trap and that the latest
move could help it shed its financial handcuffs is beyond argument. It is
also pertinent to point out that what the sponsors of the Bill have done is
perfectly legal. And from a face value judgment, they have put out what
might pass off as well-thought-out and reasoned arguments.

      But that does not mean that we agree with them on their suggested ways
to staunch the haemorrhaging at ZBC. Not by a long shot. We say so because
trying to assuage the general perception that it is immoral and unjust to
force taxpayers, to whom the public broadcaster has hardly been accountable,
to pick up the tab would be far from an easy sell. Why has ZBC, a monopoly
for that matter, been failing to meet its obligations? Why did it run up
such huge debts anyway? Doesn't this have to do with the way the public
broadcaster has been run over the years where it has had to serve parochial
political interests? First, under Ian Smith's minority regime which
practised obnoxious and anachronistic racial discrimination and then later,
under Zimbabwe's first majority government which seems to believe that life
should be frozen at the point of liberation.

      Of course as would be expected, the relevant authorities have since
said they don't interfere with operations at the public broadcaster. Well,
all we can say is blessed are the believers. But among the majority of the
people, the perception which in business is fact, the ZBC peddles nauseating
and deeply shocking propaganda. And it would be preposterous to pretend
otherwise.

      That the government had long turned off the life-support system it
extended to ZBC by way of a grant is neither here nor there. ZBC was never
established as a non-profit making organisation. Why then should it be
allowed to pressure public finances by draining the fiscus instead of
contributing to it? Moreso when there is greater need than ever before for
fiscal rectitude. In any case, ZBC is not the only one of those monoliths
called parastatals saddled with these malignant debts. So what next? Is
government going to inherit them all? Then God forbid! True, we might have
inherited part of the debt at independence but did we do any better to make
ZBC an efficient operation? Hardly. The public broadcaster has largely
remained a theatre of bigotry for political expediency. This has been
ruinous for ZBC as it has tended to choke off the business that would
normally come the broadcaster's way.

      All-knowing government officials, known for their temper tantrums, and
who should take both personal and corporate responsibility for ZBC's
predicament and failure, will be predictably furious over this observation
(we can see that coming, can't we?). But for those of us who have not yet
lost sight of why Zimbabweans sacrificed limb and life in that bloody war
that widowed wives and orphaned children against a regime that muzzled
debate and dissension, among other things, the hard fact is that there is a
severe crisis of confidence in the ZBC of today.

      The public broadcaster has failed to live up to public expectations
and could have twisted in the air were it not for the protection from
government which has refused to free the airwaves. It stands in sharp
contrast with other public broadcasters elsewhere which at least endeavour
to provide a forum for discourse and debate on pertinent national issues to
different interest groups. Bluntly put, the public broadcaster is a graphic
example of how a serious media institution should not function. It indeed
provides something for the books.

      Unlike at the turn of independence, there is now fading commitment to
factual and serious reporting. This is aggravated by at best,
less-than-satisfactory and at worst, appalling programmes. Yet the ZBC
should be an indispensable voice of the truth to be relied on at all times
by all citizens. Its failure to observe this has touched off a deep
alienation from the public broadcaster by the generality of the people and
business community alike. As a result, down went its credibility,
respectability and profitability.

      This is why we strongly feel that the authorities should have
proceeded with a modicum of sensitivity and considered other avenues to help
the public broadcaster out of its difficulties other than seeking recourse
to the over-stretched fiscus and indeed the over-burdened taxpayers who, in
the final analysis, are the ones being forced to take over ZBC's debt.

      Government has since mooted commercialisation - the half way house
between rigid state control and privatisation - as the next step in the
evolution of ZBC. But it should be seen just like that - the next step and
not the be-all-end-all of the process because there is need for radical
surgery at the broadcaster.

      Otherwise, while simply taking over the crippling debts will certainly
secure ZBC vital breathing space, it is no guarantee that the broadcaster
will not relapse into the mismanagement and inefficiency that drove it into
this choking debt-trap in the first place. Seen as politically strategic, it
remains very much vulnerable to becoming the fiefdom of some future
oppressive ruling class. Will public funds be continuously poured into this
black hole?

      The government, which has so far implemented a stop-go privatisation
programme, should therefore just bite the bullet and dispose of at least 30
percent of the ZBC after the commercialisation. Of course there could be
teething problems and serious setbacks. Government itself might be reluctant
to take the privatisation plunge. And given the sentiments about the ZBC, it
would also be quite some task to whip-up investor enthusiasm for the
urgently needed cash injection. But with binding guarantees and assurances
from the government, it can be done.

      Unlike the few and far between past privatisations where proceeds from
the sell-off of state assets were paid over to Treasury, the proceeds of the
partial disposal of the ZBC should remain in the company for debt
redemption, recapitalisation and expansion purposes.

Back to the Top
Back to Index

FinGaz

      ...and now to the Notebook

      6/24/2004 7:50:40 AM (GMT +2)

      LAST week Zimbabwe, this wonderful southern African country, marked
another first by becoming the "first-ever" AIDS country to hold a National
AIDS/HIV Conference where it also became the "first-ever" AIDS country to
spend more than a billion dollars on feeding hundreds of fat CIO agents and
booking noisy and greedy AIDS activists in expensive hotels when hundreds of
AIDS sufferers and orphans slept on empty bellies in rural areas.

      The country already boasts of being the "first-ever" country to
introduce a compulsory AIDS levy which has grown to become a good fallback
to loot and misappropriate at every turn - remember some one even tried to
divert the funds to bankroll the Miss Malaika beauty pageant?

      We were also the "first-ever" country to declare the AIDS pandemic a
national disaster but every time we have gathered at our many heroes' acres,
we have never publicly announced that members of our Cabinet, Politburo or
central committee have died from this deadly disease . . . they only die
from long or short illnesses!

      Anyway, back to the "first-ever" conference. Apart from being a chance
to spend the huge loot with our chosen friends, it was also an opportunity
to exchange "experiences" with regional counterparts . . . and usually this
word is very pregnant because the experiences are exchanged in different
ways depending on how seriously one takes the AIDS issue!

      So naturally delegates exchanged experiences.

      But there were complaints by some people that they were "sidelined",
some said the place was full of state security agents, others said the
conference was a big yawn, others said it was not long enough, while others
just complained that some people who invited themselves to the event were
irrelevant.

      But all in all, we should be proud that we managed to score yet
another "first-ever".

      Hopefully, very soon, we will become the "first-ever" country to
de-politicise the distribution of Anti-Retros, which we are already made to
believe are being given to people with the right political connections.

      AFTER finishing with Cde-Dr Nyek at the airport recently, the state
goons last week thought confused State House entertainer Fungisayi
Zvakavapano could become a threat to national security at the recently held
"first-ever" AIDS conference . . . and she got one, if not two, good ones .
. . good enough to induce a miscarriage - we are told - were it not for the
timing! All this because she was dying to give her latest CD to the First
Lady! Just that.

      At least she got to know that there is a price tag to everything on
earth . . . but if she was indeed singing for God, would there be any need
for her to bootlick a couple whose background can only be comfortably
discussed in whispers at night!

      Anyway we are sorry to the gospel diva and we hope that the Almighty
Lord will have mercy on those who inflicted pain on her! But next time she
will have to be careful on the choice of people she deals with otherwise she
will put herself into needless trouble . . . CZ will refer her to that poor,
innocent but equally well-intending school teacher who recently went to an
early grave after being mauled by some vicious dogs at . . . remember?

      CDE Lesley Gwindi is once again getting more and more in the news . .
. but, as is par-for-the-course, for the wrong reasons. Why doesn't our
national brother-in-law for once learn to involve himself in things that are
gentlemanly and bereft of any controversy . . . just for once . . . because
right now there are kids who were born and have grown up knowing that there
is a Cde Gwindi, but all for the wrong reasons. We know that he is our
national brother-in-law but this is no entrée to foist one's self into any
situation . . . Dynamos, ZTA, Harare City Council, PSL . . . everywhere it's
just controversy . . . even the Mash Central governorship that he nearly got
into! It could not be much of a bad idea if someone would christen the man
"Controversy" as his middle name!

      AFTER being abused for so long, Zimbos no longer trust anyone, even
their own grandmothers. Know what? Some Zimbos believe that after the recent
hike in soccer match admission fees by ZIFA, the adverts at the weekend that
our one and only electronic medium was unable to broadcast live the
"crucial" match between our own Warriors and the Desert Foxes of Algeria was
nothing but just a hoax to fleece as many starved soccer lovers of their
money as possible.

      Knowing that impoverished Zimbos were likely to opt to watch the
match - which turned out to be a big yawn - from their neighbours' TV sets
than to pay the newly introduced admission fees, stories were made up about
how our principled "public" broadcaster could not stoop so low as to
negotiate with some British media companies and this and that . . . only for
many people to realise on their return from the National Sports Stadium that
the barren match had been screened on our ruling party's own TV station.

      At least there will be some money to pay the expenses of the return
leg, which is promising to be another disastrously outing! Talk of survival
by hook or crook?

      SO after getting the sack from his sinecure position as governor and
resident minister for Mashonaland West, Cde Peter Chanetsa has gone
full-time into tourism. It was good to see him on our one and only TV
station commenting on our new deal with our schizophrenic Chinese friends.

      That's highly commendable because the man is some form of tourist
attraction in his own right . . . moreso if he will be dealing will with
those tiny Chinese! He can comfortably compete well with other tourist
attractions like the Victoria Falls, Great Zimbabwe or Hwange National Park!

      AND now stop and just read this: "Peace and stability attract over 10
000 as . . . Refugees opt for Zim". This was the bold headline of one
serious daily this week. CZ really wonders if the influx of refugees in your
country could be something worth bragging about . . , moreso if your country
cannot even feed its own people?

      Yes, if these thousands were tourists or investors, sure there would
be every reason for everyone who mean good for this country to celebrate . .
. at this rate, if we continue to find nothing positive to write about, next
time we will celebrate that we have one of the highest number of AIDS cases,
as we nearly did last week!

      cznotebook@yahoo.co.uk

Back to the Top
Back to Index

FinGaz

      Racism: an excuse for Africa's new tyrants

      6/24/2004 8:13:58 AM (GMT +2)

      Contemporary politico-economic discourse in Zimbabwe, Africa and
elsewhere around the globe is characterised by the phenomena of racism,
classism, tribal/ethnic and inter-group tensions and conflicts of all kinds.

      These conflicts are epitomised by widespread xenophobia and the
politics of difference.

      It is thus important to conceptualise these phenomena, particularly
the race and class questions, within the evolutionary and revolutionary
democratic practice of the African people.

      Cultural incompatibilities are often cited as the cause for the above
phenomena. But one finds that the adaptation process presented as a solution
to this problem is completely unidirectional.

      Not only politicians participate in politico-economic debate. The
media also cover race relations, class struggles and inter-ethnic conflicts.

      A reserved attitude towards what is foreign is a constant element in
human behaviour. In other words, everyone is xenophobic, including those
against whom our xenophobia is directed.

      More often than not, in times of crisis, shrewd schemers engage in
political exploitation of racial and/or class prejudice and tensions.
President Robert Mugabe, for example, exploited and manipulated racial
prejudice for political expediency in his controversial agrarian revolution.

      In economically difficult times especially, people from the lowest
classes, themselves the first victims of poverty, unemployment, bureaucratic
bungling and so on, have a tendency, when confronted with large groups of
foreigners, to regard them as the cause of all evil.

      Some self-serving African politicians and apologists go so far as to
romanticise and create an idealised African past and to claim that, in the
pre-colonial era, the continent's societies were bound by a uniquely African
spirit of brotherhood.

      They say that the values that went with this spirit were trampled upon
by white colonialism which introduced economic forms and systems
deliberately encouraging and facilitating social stratification.

      This stratification, they claim, eventually led to the division of
African societies into classes. A racial touch is usually added to this
branch of reasoning.

      True though this may be to some extent, the qualities which our
petty-bourgeois intellectuals cast as essentially African are really human
qualities which find expression when a community is at a certain level of
productive capacity.

      When a community does not have the capacity to produce social surplus,
there is simply no means of becoming unequal.

      The sense of brotherhood which is common under such conditions is
crucial for the survival of a community which is perpetually under threat,
either from natural forces which it cannot explain or of hostile invasion.

      A similar feeling of brotherhood may be manifested in times of war or
natural calamity even today.

      The Zimbabwean government's ideological construction of an enemy image
of Britain, together with the international community, and of the opposition
Movement for Democratic Change as an extension or reproduction of that
enemy, was arguably meant to evoke a misguided patriotic fervour within the
people, now supposedly under siege from "hostile external forces bent on
destabilising the country".

      According to this reasoning, the people were thus supposed to rally
behind the government in defending the "national interest" and our
"sovereignty".

      The development of towns and social classes is not an invention of the
West imposed on Africa.

      Historically, the development of agriculture and increased
productivity allowed for the creation of social surplus. This surplus was
everywhere the basis of the social division of labour, for the separation of
crafts from agriculture, of towns from country, and of the division of
society into classes.

      As long as there was no permanent social surplus, the community
remained basically rural, insecure and equal.

      So when our petty-bourgeois intellectuals talk about equality in times
gone past, they are merely describing the level of development of the
particular community about which they are talking, and no more. There is
nothing uniquely "African" about this.

      If those early forms of social organisation also contained elements of
democracy, it was the democracy of that particular time, totally unsuited to
the democratic practice of man in the present epoch.

      To say that an African can learn democracy simply by looking backward
is not only nonsensical but downright reactionary. As an economy develops,
new socio-economic and political institutions also develop and the people's
outlook and aspirations also undergo changes, simultaneously evolving new
social codes, political desires and moral ethics.

      Attempts to recreate an idealised past culture or to "Third World"
cultural uniqueness are misdirected in the face of globalisation, which is
driven by international monopoly capital.

      Moreover, they depend on a very limited, ultimately bourgeois
definition of culture. Culture is not an abstract phenomenon independent of
the people's revolutionary practice: you cannot create culture first and
make people toe the line.

      Culture is a reflection of the people's social activities in their
struggle against natural and man-made fetters. The culture of the people,
which reflects this struggle, historically opposes the culture of the
oppressors, which is the culture of counter-revolution.

      The people's culture has neither race nor continent; it is universal
because it expresses the struggle of man in general.

      The doctrine of the master race has a long history in Western
bourgeois - mostly Anglo-Saxon - culture, and Adolf Hitler gave it the
dignity of a state philosophy.

      It helped him to mobilise natural prejudice against the Jews in
Germany (as well as Slavs, Africans, Asians, and so on). And he made the
question of race the scapegoat of all the ills of the bankrupt German
economic and political systems. As a counter to white racism, many
petty-bourgeois intellectuals tend to waste their time and ours trying to
analyse social scenarios from a racial standpoint. This is dangerous in that
it is the most certain way to arrive at mistaken conclusions.

      Essentially, racism alone has never been and can never be a reliable
key to understanding the roots of social contradictions and conflicts. Far
less will its elimination automatically solve all socio-economic
misunderstandings.

      The more these intellectuals delve into false assumptions, the further
away they get from reality.

      The truth of the matter is that, in the African context, racism is
nothing but an outward and unreasonable manifestation of deep-rooted class
antagonism between the owners of the means of production, who have
traditionally been white non-Africans, on the one hand, and the dispossessed
workers and peasants, on the other. The emerging new owners of the means of
production and holders of state power, however, are now African
petty-bourgeois who adopt the demagogy of racism to cover up their
exploitation, together with the metropolitan bourgeois, of the African
masses.

      The supervisors of global economic oppression and exploitation are now
"our own kith and kin", who have betrayed the people's cause and now use the
rhetorical propaganda of racism to cover up their own treachery.

      Isaya Muriwo Sithole is a Harare-based legal practitioner.

Back to the Top
Back to Index

FinGaz

      NRZ seeks US$208 mln offshore

      Felix Njini
      6/24/2004 7:36:33 AM (GMT +2)

      THE troubled National Railways of Zimbabwe (NRZ) is hunting offshore
for a massive US$208 million to rehabilitate its depleted fleet and install
new infrastructure, including a new signalling system, The Financial Gazette
has learnt.

      It has been established that the cash-strapped NRZ has already signed
a memorandum of understanding (MOU) with China Northern Locomotive and
Rolling Stock Industry Corporation, a Chinese locomotive firm, for the
procurement of an undisclosed number of locomotives, wagons and commuter
trains.

      The parastatal has also signed a MOU with China National
Aero-Technology Import and Export Corporation for the procurement of rail,
coaches and telecommunications signalling systems.

      The rail operator, a clinical example of corporate failures synonymous
with all public enterprises, requires a fleet of between 100 and 115
locomotives every day, but is currently operating with between 64 and 70.

      To effect a noticeable change to the operations of the rail utility,
whose incapacities have

      had negative downstream effects on the productive sector of the whole
economy, NRZ requires at least 30 locomotives.

      NRZ managing director Munesushe Munodawafa told The Financial Gazette
that a single locomotive costs US$2.6 million at current market prices. This
means for 30 locomotives, the NRZ would require US$78 million.

      Munodawafa said that the parastatal also requires US$130 million to
put in place infrastructure and phase out some obsolete equipment.

      Munodawafa put a damper on prospects of raising the required money on
the local financial market and said the NRZ was already hunting for the
money abroad.

      The Reserve Bank of Zimbabwe (RBZ) has pledged to meet some of the
parastatal's monetary requirements, though analysts point out that the
amount promised would be a drop in the ocean.

      Last year, NRZ managed to raise US$10 million on the local market,
which was used to rehabilitate about 90 locomotives but did not go far to
meet the parastatal's requirements.

      "We are borrowing offshore, but the Reserve Bank of Zimbabwe has also
pledged to meet some of our monetary requirements," Munodawafa said.

      He confirmed that NRZ officials were in China recently on a technical
visit, adding that high on the priority list of NRZ's requirements is
securing locomotives and a new signaling equipment system.

      "We are still weighing options with some Chinese firms, but it is
urgent that we replenish the number of locomotives currently in operation,"
Munodawafa said.

      He added that NRZ, which used to transport on average around 480 000
tonnes per month had reduced the tonnage of cargo transported to below 200
000 tonnes.

      "We ran out of diesel twice this year resulting in some operations
being suspended added to which we are operating with between 64 and 70
locomotives. We are operating with a deficit of 50 locomotives on a daily
basis and this has a direct impact on our cash flow system," Munodawafa
said.

      He added that spare parts supplies on the local market were taking up
to 12 months before they can be delivered.

      Bulk deliveries such as coal, tobacco, minerals, cotton lint, sugar,
maize and fuel have been directly affected by the capacity constraints at
the NRZ.

      In 2003, NRZ, which contributes a substantial percentage in draining
the national fiscus, recorded an $18 billion loss.

      The state owned freight and passenger rail operator, which is battling
with a $50 billion debt this month had to pay its 9 000-plus workforce
mid-month after it failed to raise money for salaries.

      Munodawafa confirmed that the workers have now been paid their May
salaries after the company finally reached an arrangement the Zimbabwe
Revenue Authority (ZIMRA), which had garnished their account.

      "We finally made an arrangement with ZIMRA, which had garnished our
account and the workers have now been paid but as to the question of the $50
billion dollar debt, there are also companies which owe us money. In fact
NRZ is owed more money that it owes," Munodawafa said

Back to the Top
Back to Index

FinGaz

      Efficiency of financial regulation in Zimbabwe

      6/24/2004 8:14:41 AM (GMT +2)

      DID you ever wonder why we need central banks in the first place?
Their role is viewed differently depending on which side of the game your
are. Why is the chaos of last year, when the economy was almost operating on
auto pilot mode, blamed in part on the laxity of the central bank as the
authority responsible for regulating the sector? Does it mean that banks are
not capable of behaving properly on their own?

      We will appeal to theory as we try to look at the situation in
Zimbabwe from 2003 up to now in understanding how we can measure the
efficiency of the regulatory monetary authority.

      The public good theory simply states that regulation may be justified
to correct an alleged deficiency in the competitive market process. The
theory of perfect competitive markets assumes many willing buyers and
sellers and perfect information about the good or service involved in the
transaction.

      These assumptions do not always hold as such regulation is imposed to
eliminate any undue advantage that one party to the transaction (usually the
seller) might have. The market usually fails when the number of sellers is
inadequate and/or when the buyers are unable to understand the product due
to its complexity.

      Looking at the financial markets in Zimbabwe, there is certainly
evidence for market failure. While the number of players had grown
significantly over the years with the coming in of indigenous players, to
the extent others felt the market was overbanked, the competition resulted
in innovative product development which strayed outside the bounds of what
is permissible in terms of our Banking Act.

      The level of innovation had resulted in products that the market did
not fully understand hence the exploitation of investors by the various
institutions that were custodians of their investments. For all this to
happen, resulting in many billions of investors' money being lost, would
suggests that probably the regulator had been lax in his role to correct
market failure.

      This was the background to the drastic reforms that came with the 2004
monetary policy statement, which by and large, sought to reaffirm the role
of the central bank in stabilising the economy and ensuring sanity in the
financial markets.

      There are a number of public goals that have been used to justify the
substantial amount of financial regulation that we see in our markets. These
goals are to:

      lachieve competitive financial markets;

      lreduce information imperfections or asymmetries;

      leliminate prejudice or bias of supply;

      lachieve equal access;

      limprove implementation of monetary policy goals;

      lpursue socially desirable credit allocation;

      lreduce potential of insiders abuse or fraud;

      lreduce potential for disruptive impact of financial institutional
failure; and

      lprotect taxpayers from deposit insurance fund failures.

      We will evaluate the effectiveness of our central bank over the period
in question by looking at each of these goals listed above. What measures
have been put in place to ensure these are achieved?

      The period of the 1990s saw the liberalisation of the financial sector
with a view to promote competition. This policy move resulted in the
entrance of many new players in the banking industry with the number of
commercial banks more than doubling.

      Most of the new entrants were indigenous players who, in a very short
time, had introduced new products and services to the benefit of the banking
public. The competition intensified to the extent that most traditional
banks had to close their branches in small towns around the country. The
liberalisation came against a background where the market was considered to
be too highly concentrated.

      The events of 2003 resulted in some people thinking that maybe the
market was overbanked. In a perfectly competitive market, there are no
barriers to entry or exit which means if more new players can come in and
still be viable, then there is space for them in the same market.

      However, those who argue for the overbanked theory allege that since
competition on the traditional banking products and services had become too
intense to ensure profitability, players then went outside the bounds of the
law in creating assets that are usually not banking assets.

      But a close look at the books of most of these institutions would
suggest that the issue was not so much of survival but sheer greed. The
amount of revenue that was being recorded on the traditional interest income
alone was far above break even. Besides, in a perfect market structure if
there is a true case of overbanking, the excess baggage will naturally be
flushed out of the system.

      Worldwide claims of inadequate or misleading information accounts for
a growing amount of consumer-based financial regulation. As financial
contracts have become more complicated, there has been a growing demand from
public policymakers and consumer groups for regulation on disclosure and
standardisation of product and service descriptions.

      This problem is more common in the insurance industry where customers
are at a serious information disadvantage. Insurance policies are
complicated financial contracts; as a result, the average consumer is at a
significant disadvantage when attempting to negotiate with an insurance
broker.

      Reducing information asymmetries is also the object of the disclosure
requirements mandated on publicly-held corporations and organisations that
sell securities to the public.

      Since the beginning of the year, a number of bills have been drafted
to take care of a number of these concerns. Examples of these include the
Securities Bill, the Insurance Bill and the Anti-Corruption Commission Bill.
Most of these bills are at an advanced stage of being passed into law in
Zimbabwe.

      Besides banks, most financial institutions were not adequately
regulated as the mandate fell under the Ministry of Finance, which in most
cases was not adequately equipped to deal with the challenges arising from
the sector. The moving of responsibilities to the central bank, which has
also been restructured, is likely to ensure proper regulation in this entire
financial sector.

      One of the frequently cited goals of financial legislation relates to
providing access to financial services on a fair and equal basis. The first
major piece of legislation that dealt with fair and equal lending was the
Consumer Credit Protection Act of 1968 in the USA which required that cost
of borrowing be in a common language to ensure ease of comparison of costs
between lenders. Ever since, there have been a number of laws that have been
passed in the USA and the world over to eliminate prejudice or bias of
supply.

      In general all these laws help ensure that financial depository
institutions do not discriminate in their lending practices on the basis of
race, sex, or neighbourhood, and that lenders provide adequate disclosure of
their lending and deposit account practices.

      Some of this legislation provides for penalties such as the ability of
regulators to deny mergers or other requests if the institution is found to
be deficient in its lending practices. This has not been a major issue in
the case of Zimbabwe.

      Equal access to a financial service is another justification for
regulation. Financial service should be available to all classes in the
society. Access is, of course, a price related issue as well as a
geographical one.

      People in the growth points should have access to banking facilities,
and in the case of Zimbabwe the presence of Agribank and POSB has been quite
helpful in this front. However the price aspect is more relevant when one
looks at the insurance industry.

      Premiums charged should not discriminate a particular class of the
insured. However this goal of equal access is in direct conflict with the
principle that a premium that is too low could lead to adverse selection.
Under adverse selection, if poor risks are not differentiated by price, the
loss experience of the insured pool will increase, bringing about the need
for higher premiums.

      This will in turn drive the lower risk group out and the risk pool
will get riskier, causing the need for another increase in premiums, and so
on. The same can actually be true for a commercial and merchant banking
concern.

      Moses Chundu is a member of the Zimbabwe Economics Society & group
economist at Century Holdings Limited.

      Articles coordinated by Lovemore Kadenge, president of the Zimbabwe
Economics Society. Contact details: C/O Zimbabwe Business Council on Aids
(ZBCA) Tel. 753700

Back to the Top
Back to Index

FinGaz

      Mbeki leads everyone down the garden path

      6/24/2004 8:13:23 AM (GMT +2)

      YOU would think that for anyone claiming to be committed to helping to
resolve the Zimbabwe crisis so as to alleviate the suffering of millions of
people, one of the guiding principles would be the need to treat the matter
with utmost urgency.

      But of course, if you are thinking of South African President, Thabo
Mbeki, the man regarded as the most strategically placed African leader to
influence events on this front, you would be totally wrong. Urgency is the
last thing on the mind of the man who has stuck to quiet diplomacy and a
softly-softly approach although it has been shown over and over again that
this modus operandi will never work in relation to a problem as serious as
the governance crisis in this country.

      Reminded last week that there was still no breakthrough despite his
over-confident assertions sometime ago that by this month, the stalled talks
between ZANU PF and the Movement for Democratic Change (MDC) would have
resumed, Mbeki did not seem in the least perturbed. The ever double-talking
South African leader did not seem to have any qualms whatsoever about moving
the goal posts one more time and adjusting his equivocations accordingly.

      Contacted by journalists from this newspaper last week for a comment
on the lack of progress despite the expiry of his June deadline, Mbeki's
spokesman Bheki Khumalo said the South African leader would continue to push
for dialogue. At a very leisurely pace, no doubt.

      And, added Khumalo, Mbeki's earlier bold declarations that by this
month, ZANU PF and the MDC would have returned to the negotiating table were
apparently neither statements based on an objective assessment of the
situation on the ground nor a credible signal of a determined resolve to
influence events in the desired direction.

      Incredibly, we are now told, Mbeki gave that deadline only "to focus
the attention of the president (Zimbabwean leader Robert Mugabe) to find a
speedy solution to the Zimbabwean problem." We are not told how this was
supposed to focus President Mugabe's attention when the reason for Mbeki's
intervention, in the first place, was because no attention altogether was
being paid to the crisis.

      Mbeki conveniently neglects to explain why this approach then failed
to do the trick and how he expects it to work in future. More importantly,
Mbeki's office has not bothered to explain why the South African leader
stubbornly stuck to his guns about talks between ZANU PF and the MDC being
under way even when the supposed participants themselves persistently denied
knowledge of any such talks taking place.

      Is Mbeki seriously telling us that the scope of his role as a mediator
and peace broker in the Zimbabwean conflict is limited to making equivocal
and far-fetched statements in the hope that one of the parties to the
dispute will take the hint? In the case of the infamous June deadline, how
was the MDC and indeed the rest of the world supposed to know that rather
than being a well considered proposal, this was just a case of Mbeki
whistling in the dark?

      I have always argued that an honest mediator's role is to talk to both
parties to a dispute. If he does not do this, as Mbeki evidently did not,
how does he present his proposals regarding the way forward and use his good
offices and influence to facilitate progress? The picture emerging from all
this seems to suggest that Mbeki's "quiet diplomacy" literally means he
never says anything to the parties he is supposed to help find common
ground. Why?

      Even more confounding, Mbeki seems to think that on the strength of
this muddled outlook of a serious problem that calls for clarity of mind and
purpose, he has all the time in the world to continue plodding along and
groping in the dark. "If the deadline has not been met, we will continue to
try. There is need to step up our efforts but a lasting solution requires
patience. It took 10 years to resolve the Congolese problem," Mbeki's
spokesman said last week.

      So now we know. Mbeki is prepared to accept the lowest common
denominator as the standard to aspire to. If it took a long painful decade
to resolve the Congolese problem during which two million people died and
others were displaced and endured untold suffering, why should he tolerate a
repeat of the situation in Zimbabwe?

      And if Mbeki needed any proof that he must provide real leadership
rather than the risible hands-off charade we have seen so far, it was
provided by the head of the ZANU PF team to the phantom talks, Justice,
Legal and Parliamentary Affairs Minister Patrick Chinamasa.

      Showing all the symptoms of the sovereignty syndrome that has
afflicted the ruling party and government for some time now, Chinamasa
boasted that ZANU PF would not be "rushed" into negotiations. "We are a
sovereign country and are not pushed into any decision by anyone," said the
minister, stressing for good measure that this included not taking any
"directives" from Mbeki.

      This begs the question of whether ZANU PF understands the mechanics of
international mediation and if so why it agreed to engage in dialogue with
the MDC at Mbeki's urging in the first place. Have Mbeki and ZANU PF led
everyone along the garden path all along? Mbeki's muddled thinking, his
fumbling approach and his readiness to countenance the possibility of the
untenable situation in Zimbabwe remaining unresolved for another 10 years
provide very good clues as to whether he is serious about his role or
whether he is shedding crocodile tears over the matter.

      Moreover, Chinamasa's quibbling over the hackneyed issue of
sovereignty this late in the day suggests that both ZANU PF and Mbeki have
lost sight of the reason why Zimbabwe needs to put its house in order. Do
they need to be reminded that all that is wrong in this country such as
repressive laws, lawlessness, selective application of the law, alleged
state-sponsored political violence, a collapsing economy that has reduced
citizens to scavengers and the collapse of virtually all state institutions,
needs to be corrected urgently because it affects the lives of real, flesh
and blood human beings?

Back to the Top
Back to Index

FinGaz

      Farm leases may be illegal

      6/24/2004 8:12:39 AM (GMT +2)

      Pandemonium, confusion, ignorance and astonishing madness can best
describe methods by which land acquisition and allocation has been
implemented and is still being implemented in Zimbabwe.

      The government has sought to let the end justify the means, but there
is incontrovertible evidence that no end may be realised.

      Anarchy, instigated by unbridled greed, graft and misguided populist
rhetoric, continues unabated.

      It must be stated here without any ambiguity that genuine empowerment
of the underprivileged and marginalised can only commence and take shape
through land.

      The fact that land is the foremost means of production that can act as
a swingboard for accelerated advancement is not debatable. What is debatable
are the controversial acquisitions and allocations pervaded by disorder,
lack of transparency, manifestly contemptuous acts and illegalities.

      This article seeks to identify and discuss one fundamental area of law
that has been misunderstood and misapplied with far-reaching implications.
This is the Agricultural Land Resettlement Act (Chapter 20:01) (The Act).

      This Act, read together with the Land Acquisition Act (Chapter 20:10)
and subject to the Constitution, is the benchmark providing guidance in the
broader land distribution process.

      A failure to understand these laws, especially as regards land
allocation, has caused acrimony between intended beneficiaries of the land
reform. Between these, insults have been exchanged, blows thrown, guns
blazed and blood oozed because of disputes caused by double or multiple
allocations of single holdings of land.

      In terms of Section 8 of the Act: "The Minister may (subject to the
Act) issue leases to applicants in respect of holdings of lands."

      This section does not state that the minister or any of his "lawfully
delegated officials can allocate land". It is unambiguous, and only those
not blessed with talent to read between the lines can fail to comprehend
this provision.

      It follows, therefore, that every offer letter for all land allocated
so far must bear the signature of the responsible Minister. Currently
Minister John Nkomo is mandated to allocate land, and offer letters granted
prior to Nkomo's assumption of office must bear Agriculture Minister Joseph
Made's signature and not that of provincial administrators, governors or any
other government official.

      Further, there is what is called an Agricultural Land Settlement Board
(the board) established in terms of Act 2 of 2003.

      This board is there to, among other things, consider and report upon
all applications for leases of land and to select and recommend applicants.

      The minister can therefore not act unilaterally in the land allocation
process. According to law, he must allocate land to applicants who have been
selected and recommended by the board.

      It cannot be doubted that the said board was established to ensure
transparency and avoid incidents of nepotism and bias.

      The operations of this board, if ever it exists, have been shrouded in
bewildering secrecy. With the hullaballoo and euphoria surrounding the land
issue, the nation, for the sake of accountability and transparency, should
have been informed about this board.

      There are obvious reasons why the government has decided to shove
information about this organisation underground. Land recommendations and
selections of applicants have been done outside the set procedures.

      Rather than be guided by the Act, the government, driven by its
vainglorious tendencies, followed its own ruling party structures, in open
defiance of the law.

      Across the nation, the ruling party has set up district land
allocation committees. These identify land, select and recommend applicants
for all module "A1" holdings.

      Likewise, the provincial land allocation committees chaired by
governors purport to facilitate the allocation of the "A2" holdings. These
manifestly illegal organs are supervised and operate on the directives of
Vice President Joseph Msika, who is the ruling party land committee
chairman.

      There is evidence of circulars, letters and other forms of documents
starkly confirming the illegal usurpation of power by these variously
constituted organs of the ruling party.

      This unfortunate scenario caused the nasty verbal attack on Nkomo by
the pompous, overzealous and populist leader of the war veterans, Joseph
Chinotimba.

      It can be perceived that the confusion was conceived through lack of
proper legal advice and has been nurtured by the ruling party, with dire
eventualities. The misted confusion around land allocation, which is
becoming unmitigated by the day, will inflict serious harm on the land
reform process if not remedied with due promptness.

      As observed, land allocations appear to have been done without
selections and recommendations from the board.

      It also appears that since the inception of the chaotic land reform
programme, all acquisitions and allocations have been facilitated by a de
facto "board" in the form of the stated ruling party organs. The legal
structure set up in terms of the law has been elbowed out and rendered
moribund, to the obvious disadvantage of transparency and legality.

      This is not surprising. Because the habit of passing laws to soon
render them redundant has been fashionable to the government.

      There are countless illustrations of illegalities, some of them fatal,
perpetrated and perpetuated by the government without any regard to the
Constitution. If any attempt to list them were to be made, it would be of
encyclopaedic proportions.

      While Justice Malaba's ruling in Airfield Investments (Pvt) Ltd vs The
Minister of Lands handed down on June 3 2004 clarifies the issue of land
"acquisition", more and better judicial authority is required on the
contentious issue of "allocation".

      The government's failure to comply with laid-down procedures has
embarrassing and titanic implications.

      All land allocations done so far appear to be illegal and consequently
null and void. Those who have been "leased" farms are on the holdings
illegally because they were not selected and recommended by the board.
Indeed, these were selected by an ad-hoc, de facto political set-up acting
in contravention of statute.

      This revelation must teach our leaders lessons about respect for law
and order. The government definitely needs education and re-orientation as
far as the operations of law and its attendant responsibilities are
concerned.

      Otherwise any continued travelling on the wrong side of the law will
lead to a fatal crash that might render the whole land reform process
inconsequential.

      lVote Muza is a legal practitioner with Gutu and Chikowero law firm.

      E-mail address: gutulaw@mweb.co.zw

      Web: www.gutulaw.co.zw

Back to the Top
Back to Index