Diamonds fail to sparkle at Chiadzwa

http://www.theindependent.co.zw/

Thursday, 23 June 2011 20:24

Paidamoyo Muzulu/Wongai Zhangazha

NEARLY five years after large earthmoving equipment roared onto the serene
semi-arid Chiadzwa to exploit diamonds, this relatively small and unknown
community has nothing to show for its natural wealth.

Chiadzwa still remains a sleepy village of collapsing huts and isolated
brick houses, with the exception of rumbling excavators and mills excavating
the multimillion precious gems day and night.
The gigantic machines have scarred their mountainous landscape, and yet the
villagers continue to trudge the dusty pathways leading to the dry Save
riverbed, where they compete with livestock and wildlife for scarce drinking
water.
Villagers still roam the mountainside fetching firewood as electricity
remains a pipe dream, 31 years after Independence. The general poverty in
the community contrasts sharply with the millions generated from the
occasional auctions of gems mined at Chiadzwa.
Hopes of local communities were temporarily raised when government
introduced the indigenisation policy aimed at transferring ownership of
wealth to locals. Under the policy, foreign-owned companies are required to
cede up to 51% ownership to locals.
However, implementing this policy is fraught with its own challenges, chief
among them, legal issues. A few weeks ago, the Parliamentary Legal Committee
ruled that the new regulations setting deadlines on the issuance of equity
disposal plans by mining companies was unconstitutional.
Villagers have banded together to form the Chiadzwa Community Development
Trust to help them secure benefits from the gems extracted from their
community.
The trust has mobilised the Chiadzwa community in an attempt to assert its
rights and benefit from the diamond mining. It has also become the community’s
mouthpiece in negotiations with all stakeholders, including donor and
government agencies.
Chiadzwa villagers have had very little benefit from Anjin Investments, a
joint company between the government of Zimbabwe and China, which has the
lion’s share of the rich minefields.
Anjin has displaced close to 300 families from the Chirasika area of
Chiadzwa to an Arda farm in Odzi and compensation for the displaced families
is just a three-roomed brick and mortar house. The company has also promised
to create a viable community in the new settlements by providing social
infrastructure like schools and clinics.
However, the locals are complaining that they were not being given
opportunities to work at the mines or the proposed diamond cutting plant
being built on the outskirts of Harare in Mount Hampden, nearly 400km from
the mines.
Meanwhile some of the villagers are embroiled in a fierce struggle with
controversial diamond mining company Mbada Holdings over the company’s plans
to exhume 24 bodies for reburial to expand its mining activities.
Two affected families, the Kusenas and Manyeres of Ward 29 Betera Village,
have refused to have bodies of their relatives exhumed without first
receiving full compensation and an assurance that they would be reburied at
a place of their choice.
The families are demanding US$3 000 per body and the reburial to be in Arda
Transau in Odzi to where displaced families are being relocated.
According to the villagers, Mbada offered to pay US$150 per grave as
compensation and this has infuriated the families.
Mbada Holdings has indicated that it will rebury the bodies in a local area
which would not affect its mining activities.
A spokesperson of the two families Tichafara Kusena said on Tuesday that
they were not going to succumb to a shady deal with Mbada Holdings if their
demands were not met.
“Mbada Holdings approached us for the third time now, saying they wanted to
exhume bodies of our relatives so that they can construct a dam to help them
in their mining activities. They said they were working on a tight deadline
and wanted to complete the dam by June 29, but we have not reached an
agreement over the compensation they want to pay us. We can’t just rebury
our relatives without them compensating us. Moreover, they want to rebury
them at a place where we do not want. We can’t leave them here (Marange) as
we suspect that once it becomes a protected area, we won’t have access to
them,” said Kusena.
Kusena revealed that of the 24 graves earmarked for exhumation, 21 graves
(10 adults and 11 children) belonged to the Kusena family while the
remainder was of the Manyere family.
“Our understanding is that they first went to headman Betera, who demanded
US$1 500 and two oxen, they then approached spirit medium Muperere who also
demanded US$1 500 and they agreed to pay him. They offered us US$500 per
grave and threatened that if we refused, they would give us what they said
was a government amount of US$150.”
Mbada diamonds spokesperson Ignatius Mazura confirmed that the diamond
company negotiated with villagers over exhumation of graves.
“We have discussed with the communities and agreed on the compensation, the
process and place to relocate these graves. Traditionally, in relocation
programmes, communities would like to ensure that the graves of their
ancestors are relocated with them. To that end, all graves belonging to the
community to be relocated shall be exhumed through mutual consent in strict
cultural and traditional norms,” he said.
Such issues as the reburials may be a side issue but the bottom line is that
the Chiadzwa’s diamond Eldorado has failed to spur infrastructural
development in this poor community except to trigger a wave of human rights
abuses and the displacement of whole communities from their ancestral land
to make room for the expansion of mines and their security.
Reports of diamond smuggling and incidents of human rights abuses in the
area rife. The arrest of senior mining authorities on corruption charges and
endless reports of atrocities by the military have become a norm at
Chiadzwa.
This sad reality has replayed itself in Africa as communities warred against
each other for control of natural resources. Angola, DRC, Sudan, Sierra
Leone and Nigeria have been ravaged by civil wars for control of resources
such as diamonds, oil and timber harvesting.

Sadc moves to prevent clashes with GNU parties

http://www.theindependent.co.zw/

Thursday, 23 June 2011 19:02

Dumisani Muleya

SOUTHERN African Development Community (Sadc) leaders have resolved that
before any further regional summits, South African President Jacob Zuma, the
facilitator on Zimbabwe, would engage local political principals to prevent
further protests on lack of consultation similar to those made by President
Robert Mugabe during the recent Sandton meeting.
Information gathered by the Zimbabwe Independent shows that one of the
decisions taken at the Sadc summit in Sandton, Johannesburg, on June 12 was
that Zuma should meet Mugabe, Prime Minister Morgan Tsvangirai and Professor
Welshman Ncube before meetings to avoid similar clashes as those witnessed
during recent summits in Livingstone, Zambia, and Sandton.

“A decision was made at the Sandton meeting that Zuma would before future
summits meet Mugabe, Tsvangirai and Ncube as heads of the three main
political parties involved in the (Global Political Agreement) GPA to ensure
there are no more fights on consultations,” documents on the Sadc summit
show.

“The reason was that there were arguments between Mugabe and Zuma on the
issue of consultation. Mugabe claimed Zanu PF was not consulted before the
Livingstone summit on the political and security situation in Zimbabwe, but
Zuma insisted his facilitators consulted all the three parties. This created
a situation in which Mugabe and Zuma found themselves openly in dispute in
front of their colleagues and even subordinates.”

In the closed Sandton session Mugabe had with him Defence minister Emmerson
Mnangagwa, Transport and Communications minister Nicholas Goche, Justice
minister Patrick Chinamasa, Foreign minister Simbarashe Mumbengegwi and
Central Intelligence Organisation Director-General Happyton Bonyongwe.
Chinamasa and Goche are Zanu PF negotiators.

Zuma had his facilitators and a host of aides.

Tsvangirai was assisted by Finance minister Tendai Biti, Energy minister
Elton Mangoma, Information Communication Technology minister Nelson Chamisa
and Minister of State in Tsvangirai’s office Jameson Timba.

Ncube was backed by his two negotiators, Priscillah Misihairabwi-Mushonga
and Moses Mzila Ndlovu.

Information to hand shows that as a result of that decision Zuma would visit
Harare just before the next Sadc summit in Angola. The summit in Luanda is
expected to give direction on Zimbabwe after the completion of the elections
roadmap and outstanding issues.

Highlights of the Sandton summit:

    Sadc moves to prevent clashes with GNU principals:

    Meeting called to order at 6:23pm by Sadc chairman, President
Hifikepunye Pohamba of Namibia and salutations follow;

    Sadc executive secretary Tomaz Salomao refreshes minds of leaders on
proceedings of the summit, mainly on Madagascar;

    Pohamba makes introductory remarks before handing over to Zuma to
present his report on Zimbabwe’s political and security situation;

    Zuma presents his updated report and makes five recommendations;

    Mugabe thanks Zuma for the new report but angrily protests about the
Livingstone annexure;

    Tsvangirai makes a brief presentation insisting on outstanding issues
and timelines in the roadmap;

    Ncube briefs the summit focusing on the lifespan of the GPA, timeframes
on the roadmap and violence and intimidation;

    Pohamba then takes over and says “We have heard from President Zuma and
leaders of political parties in Zimbabwe, now I open the floor for
discussions”;

     Swazi King Mswati commends Zuma for a “job well done”, talks about
sanctions and says the three GPA parties must work together like “conjoined
triplets”;

    Zambian vice-president and Justice minister George Kunda then makes
comments, saying his country as the chair of the Sadc troika organ on
politics, defence and security endorses Zuma’s reports and recommendations.
He encourages GPA parties to proceed in the same cooperative spirit;

    Pohamba makes an important revelation about his mood as chairman before
the summit. He says he was “worried” about what would happen in the meeting
but after Zuma’s reports and presentations by Mugabe, Tsvangirai and Ncube
he felt relieved. He thanks Zuma and Zimbabwean leaders for their
cooperation. Further, Pohamba says: “I suggest that the summit takes note of
the March (Livingstone) summit report and its resolutions and today’s
report. All reports, including the Livingstone one, are then adopted and
Pohamba proceeds to say Zimbabwean leaders have a responsibility to deal
with “violence issues”. Pohamba turns to Mugabe and says “yes it’s true
President Mugabe that incidences of violence occur everywhere but you as
leaders must deal with violence. Let’s reduce violence”.  Pohamba then goes
on to deal with sanctions, saying all parties must work together to remove
sanctions because “sanctions are harming everyone” and that if “Zimbabwe
burns we all burn”;

    Botswana vice-president Mompati Merafhe congratulates Zuma on his report
and says: “I hope this momentum will not be lost”. He then says Sadc
leaders, including himself, were now “fatigued” about the Zimbabwe situation
which has been on the agenda for “so long” and adds he is looking forward to
a time when “Zimbabwe is off the Sadc agenda” because “this thing distracts
our attention and dissipates our energies” while “keeping the region in a
crisis mode”. He says the next elections must resolve the issue once and for
all;

    Zuma bounces back and insists that “before I write these reports I
consult all parties”. He says before Livingstone he had consulted “all
movements” but says he appreciates the dispute over that has been cleared
with Mugabe. Zuma insists he is objective and does not want a “wrong
impression” created about him;

    Pohamba says to prevent unnecessary quarrels in future reports on
Zimbabwe would be immediately distributed to parties. This was after Mugabe
had said he had not seen the Livingstone report;

Salomao firmly rebuts Mugabe’s claim he had not been sent the Livingstone
report, saying: “I personally made arrangements for the circulation of that
report”;

    Pohamba congratulates Zuma again and says he must continue like that. He
then says: “I want us to endorse that principals must be consulted before
all meetings on Zimbabwe”, thanks all principals and says “you have
demonstrated we are getting there” before going back to the issue of
sanctions;

    Lesotho Prime Minister Pakalitha Mosisili says “the levels of engagement
on Zimbabwe must be raised”;

    Contributions from Mauritius Foreign minister Arvin Boolell and then
Seychelles vice-president Danny Faure follow and finally;

    Pohamba makes further remarks, thanks everybody for coming and Zuma for
hosting and urges summit to pay condolences to the government and the people
of South Africa for the passing on of Albertina Sisulu and then closes the
summit thanking South Africa for the “warm hospitality” extended to
delegates and facilitates provided for the meeting.

Baz rejects licence applications

http://www.theindependent.co.zw/

Thursday, 23 June 2011 19:01

Paidamoyo Muzulu

THE Broadcasting Authority of Zimbabwe (Baz) has turned down five
applications from aspiring broadcasters in the last decade for what the
authority called failure to meet its licensing requirements.
According to a report tabled in the House of Assembly by Media, Information
and Communication Technology portfolio committee chairman Seiso Moyo, the
stringent requirements Baz has attached to the granting of new broadcasting
licences means that liberalisation of the airwaves remains a pipe dream.

The report comes at a time when the limping coalition government claims to
be in the process of democraticising the electronic media, presently
monopolised by the state-controlled Zimbabwe Broadcasting Holdings.

“The (Baz) chief executive officer indicated that the authority had invited
applications in 2002 and those that responded could not meet the stipulated
requirements,” reads the report.

The authority received five applications for commercial broadcasting
licences out of the 15 that it advertised in 2004. However, all the
applications, four for radio and one for television, were rejected.

The 15 licences were for provincial commercial radio stations and one
national free to air television station.

Potential new players told the committee they suspected that Baz was
deliberately blocking new entrants into the field.

“The licensing criteria have been regarded by the media fraternity as highly
prohibitive and they suspect it is deliberate to maintain the status quo,”
says the report.

The Broadcasting Services Act of 2007 prohibits any individual or corporate
to hold more than 10% of shares in any company seeking a broadcasting
licence. In other words, an applicant for a broadcasting licence should have
a minimum of 10 shareholders.

The Act further prohibits a holder of a broadcasting licence from applying
for a signal carrier licence. This means all broadcasters would have to rely
on the state-owned Transmedia for their signal.

This would force all new entrants to purchase broadcasting equipment which
conforms to Transmedia’s analogue transmitters.

ZBH uses analogue technology after a failed attempt to migrate to digital
transmission through Iranian funding and technology.

Baz indicated that all licences are renewable and valid for two years. No
foreigners are allowed to work or assist in the operations of any new
licensed broadcaster.

Recently, the authority flighted two adverts for commercial radio licences,
although in reality only one is available since the ZBH has already secured
the other.

“For commercial radio, the frequency has a capacity for six radio licences
and five were allocated to ZBC for Radio Zimbabwe, Power FM, Spot FM,
National FM and Voice of Zimbabwe, leaving one for new players,” the
parliamentary report said.

The report indicated that most Zimbabweans shunned the local broadcaster’s
“biased” programming in favour of the free-to-air digital satellite
stations.
“The public lamented lack of consultation on programmes aired by the public
broadcaster and as a result many viewers have opted for satellite dishes and
shun ZTV.”

The committee recommended that the “ZBC editorial policy should be reviewed
to remove the perceived propaganda bias” and indicated that licensing of
community radio stations was long overdue and had to be expedited.

Military chefs rake in mining profits

http://www.theindependent.co.zw/

Thursday, 23 June 2011 19:00

Nqobile Bhebhe

ZIMBABWE’S top military brass, politicians and businessmen loyal to
President Robert Mugabe have teamed up to form a new bourgeois class that
has ventured into the lucrative mining business.
According to a 31-page Crisis in Zimbabwe Coalition report titled “The
Military Factor in Zimbabwe’s Political and Electoral Affairs” released in
Johannesburg, South Africa, recently, the military is increasingly playing a
central role in directing production and controlling ownership of the means
of production.

The report is based on research conducted between September 2010 and March
2011 and it was compiled after interviews with various policy makers,
serving and retired military officers, and officials in the inclusive
government.

It said 52 key institutions were being run by military personnel.

“Through an elaborate patronage system established to reward partisan senior
military officers and keep them loyal to Zanu PF and to Mugabe, the military
has increasingly played a central role in directing production and
controlling ownership of the means of production,” reads the report.

Over the years senior military officers, in line with an elaborate patronage
system, have been appointed to lead strategic state institutions, which
include the Zimbabwe Prisons Service, the Zimbabwe Republic Police, the
Central Intelligence Organisation, the Zimbabwe Electoral Commission,
National Railways of Zimbabwe and the Department of National Parks and
Wildlife, the report said.

“The increased militarisation of the state has led to the military taking
control of an expanding range of decisions and actions from political
strategy to the formulation and implementation of agrarian and economic
policy.”

The report said Mugabe had gone to great lengths to ensure the military’s
continued loyalty “including distribution of land, housing and prominent
political positions to top-ranking military officials and distribution and
production of food”.

It revealed that companies granted licences to mine diamonds in Marange
under unclear circumstances, and in violation of Zimbabwe’s laws and
regulations regarding tender procedures, were controlled by senior military
officers.

“There are genuine fears that diamond revenue from Marange, which is not
properly accounted for, is being used by the military and those aligned to
Zanu PF to build a war chest to fund electoral violence should Zimbabwe go
to elections in 2011 as Zanu PF so much wants,” reads the report.

Although the political leadership of the military was openly partisan, many
rank and file soldiers are professional and non-partisan and aspiring to
faithfully serve their country, said the report.

The report recommended that the inclusive government recalls all soldiers
presently deployed to organisations across the country and directs all
military leaders to jointly issue a public statement denouncing the meddling
in political and civilian affairs.

Indigenisation: Kasukuwere backs down

http://www.theindependent.co.zw/

Thursday, 23 June 2011 19:00

Paidamoyo Muzulu

YOUTH Development, Indigenisation and Empowerment minister Saviour
Kasukuwere this week backed down on the indigenisation regulations by
promising to revise contentious clauses in Statutory Instrument 34 of 2011
in line with concerns raised by the Parliamentary Legal Committee (PLC).
The committee gave an adverse report on the instrument compelling all
companies to file their specific indigenisation plans as of the beginning of
June 2011 with Kasukuwere’s ministry.
Contrary to Kasukuwere’s assertions that the PLC’s adverse report had been
withdrawn, the committee clarified what it agreed with the ministry at a
meeting on Monday.
Committee chairman Shepherd Mushonga said the PLC would only withdraw its
adverse report on the regulations once the minister gazetted amendments
proposed by the parliamentarians in the Government Gazette.
“We will only withdraw the adverse report once he (Kasukuwere) gazettes new
regulations which address the concerns we raised in our adverse report. We
are afraid that the minister may dupe us into withdrawing the adverse report
and fail to publish the amendments he has agreed to make,” said Mushonga.
Kasukuwere had told the Zimbabwe Independent on Tuesday that the PLC had
agreed to withdraw its adverse report after their Monday meeting without any
conditions.
“The PLC withdrew its adverse report”, said Kasukuwere. “They realised that
they had not filed their concerns in time in line with parliamentary
regulations. They should have filed their objections within 30 days of the
gazetting of the regulations. They only did so as an afterthought, probably
after receiving advice from the business community”.
The clerk of Parliament Austin Zvoma also concurred with the PLC’s position
in a letter addressed to Kasukuwere concerning the regulations.
“The Committee further resolved to withdraw the adverse report from the
House of Assembly as soon as the amendments you suggested are published in
the Government Gazette,” Zvoma wrote.

Bank charges milking depositors — analysts

http://www.theindependent.co.zw/

Thursday, 23 June 2011 18:58

Paul Nyakazeya

INDIVIDUALS and corporates are forking out between US$20 and US$40 monthly
in bank charges, far above regional averages of below US$25, as banks milk
account holders through high charges to boost their income and support the
infrastructure they put in place when the economy was faring better.
Figures obtained from different banks show that an individual is charged
between US$2 and US$8 for a single withdrawal while companies pay up to
US$10 to be issued with a draft/RMO. Charges for withdrawals increase
depending on the amount being withdrawn.

In South Africa, Botswana, Zambia and Mozambique the average charge or a
withdrawal is US$3 dollars.

Telegraphic transfers cost between US$15 and US$30 for both corporates and
individuals depending on the amount involved. The same amount is charged for
deposits received by telegraphic transfer. The regional average for such
transactions is US$14.

However, Bankers Association of Zimbabwe (Baz) says local bank charges were
in line with regional charges.

Asked if local bank charges were not too high when compared to the region,
Baz president John Mushayavanhu said local charges were competitive.

“As Baz, we have done a study of bank charges in the region and overseas and
I can confirm to you that our charges are very comparable to the charges
prevailing in the region,” he told businessdigest.

“What we are focusing on now is continuous investment in electronic banking,
which reduces cost. On interest rates charged by banks, we are working,
through moral suasion within the association, to reduce the disparity on
interest rates being offered and/or charged by banks.

“This will go a long way in minimising the underlying contagion effect of
arbitrage opportunities associated with the disparity,” Mushayavanhu said.
Some analysts’ said the charges were outrageous and reflect the structural
inefficiencies that banks have carried over from the hyper-inflation
environment.

Banks are said to be sitting on deposits that from the core business
perspective, cannot generate sufficient interest income to cover their
operational expenses.

The net interest margins, in the range of 2%-7% are too thin especially for
small banks that sit on deposits below US$150 million.

“Resultantly the banks overload the non-interest income to ensure that the
cost to income structures remain respectable,” a banker said

“But unfortunately overloading the non-interest income component means
asking the customers to pay more in bank charges for bank inefficiencies and
economy-related structural rigidities,” said the banker.

Local banks are also charging as much as US$10 for a single deposit. The
average regional charge for the same transaction is US$7.
Some banks are not charging for maintaining clients’ accounts, but others
are levying between US$2,90 and US$5. Corporates are being charged between
US$8 and US$12 per month for monthly account maintenance. FCA inter account
transfers cost between US$1 and US$5 depending on the bank for both
individuals and corporates.

Economists David Mupamhadzi told businessdigest this week that the current
bank charges in the market were not favourable and discourages people from
using the formal banking channels.

“When faced with punitive charges customers will shy away from the formal
market, a situation which is detrimental for the growth of the economy,” he
said.

“Addressing the issue of liquidity is important to solve the pricing problem
in the financial sector. Currently the market is dry, while costs are going
up — a situation which will force banks to hike bank charges to recover
costs,” Mupamhadzi said.

Mupamhdzi said banks should also accept the reality in the economy, and
downsize their operations.

“It is difficult to see how banks can maintain the same cost structures as
before the adoption of the multicurrency system,” he said.

Service charges for salary processing tariffs cost between US$1, 50 and US$4
per entry for manual salary payments. Unclaimed salaries cost between US$4
and US$7.

Companies are being charged between US$7 and US$10 per payroll for late
salary submissions.

Most banks have not set a charge for intermediated money transfer tax.

Facility negotiation fees for companies cost 5% of the value of the
overdraft or loan. Between US$4 and US$8 is charged for stop orders.

Economist John Robertson told businessdigest that bank charges in Zimbabwe
were punitive, and discouraged people from using formal channels for
savings, a situation that is undesirable especially given the liquidity
problems that the economy is facing.

“Banks should play a leading role in mobilising savings across the whole
country through offering attractive returns, however in the case of Zimbabwe
this is not happening because of the high bank charges and the low returns
on deposits,” he said.

Bankers interviewed said most banks in the region do not use bank charges as
a main source of income, a situation which is prevalent in Zimbabwe.
In South Africa for example, high bank charges are levied on people who
withdraw huge amounts of cash as a way of discouraging people from
withdrawing large amounts of cash.

Accounts closed within six months are attracting a fee of between US$18 and
US$25, while reactivation of a dormant account costs between US$20 and
US$25. Services for bonds guarantees, securities and indemnities and bills
range between 5% and 10% of the amount at hand.

Charges for letters of guarantee, and guarantees are between 4% and 6% of
the amount involved. Letters of credit for foreign inward cost US$75 per
credit. Foreign outward for commercial banks cost 10% of the amount being
transacted.

A bank CEO who spoke to businessdigest said banks typically derive their
income from a combination of interest income as well as non funded income
which includes bank charges.

“The charges are somewhat justified given the cost structures prevailing in
the banking institutions,” he said

“Given the subdued income from the core lending activities, fees and
commission income have been maximised to boost overall profitability but
this will gradually correct itself in response to market forces and
technological advances. Fees and service charges will however remain an
integral part of all banking institutions’ income,” the CEO said.

Economic analyst Eric Bloch told businessdigest that the innumerable public
critics of Zimbabwe’s banks were also appalled by the magnitude of the
interest rates applied by the banks to those limited loans and advances as
they are able to make.

Ambitious project to eliminate child HIV/Aids

http://www.theindependent.co.zw/

Thursday, 23 June 2011 18:57

Wongai Zhangazha

WHEN Patience Mapfumo tested positive for HIV/Aids during her pregnancy she
thought her world would crumble around her.
Mapfumo kept her status secret thinking of the trauma she would have to
endure at the hands of her family and the public at large.

Because of the prevailing societal stigma she didn’t understand what this
all meant and feared for her unborn baby.

With time, she gathered enough courage and registered for the prevention of
mother to child transmission (PMTCT) programme where she was quickly
introduced to a support group of other HIV positive mothers.

“I realised that I was not alone and that my baby didn’t have to be born
HIV-positive. I have since been blessed with an HIV-free son,” said Mapfumo.

Presently, she is involved with two support groups which offer counselling
services for PMTCT and HIV/Aids in general.

Mapfumo is one of many women who have benefitted from the intervention of
the Elisabeth Glaser Pediatric Aids Foundation (EGPAF) which works with the
Health and Child Welfare ministry to eliminate pediatric HIV infection.

Other beneficiaries of the project are Claris Chauruka and her husband
Pitiel.

After testing HIV-positive, Claris and her husband enrolled for the PMTCT
programme and as a result she gave birth to a healthy, HIV-negative baby
boy.
They are now strong advocates for people to know their status and positive
living.

Although Zimbabwe has done relatively well in terms of reducing HIV/Aids
infections among adults, a lot of work still has to be done in lowering
mother to child transmission and pediatric HIV/Aids.

World leaders recently gathered in New York for the 2011 United Nations High
Level meeting on Aids to set new global targets in the fight against the
pandemic, but the lingering question is whether governments can meet the set
targets.

The new plan focuses on a series of specific policy and programmatic
interventions which countries have to undertake to ensure that all pregnant
women with HIV have access to prevention and treatment as well as
eliminating new infections among children by 2015.

Michel Sidibé, executive director of UNAids believes that by “2015 children
everywhere can be born free of HIV and that their mothers can remain
healthy. This new global plan is realistic, it is achievable and it is
driven by the most affected countries”.

In Zimbabwe, the debate is on how such targets can be achieved.

The health department estimates that more than 13% of the country’s pregnant
women are HIV-positive and many have no access to mother to child prevention
services.

About 150 000 children under the age of 15 are HIV positive and one out of
every eight children die before the age of five from HIV/Aids related
causes.
Zimbabwe’s challenge is to reduce this rate by 90% by 2015.

With the coalition government preoccupied with fighting for absolute power,
it remains to be seen whether this target can be achieved.

“The target is very achievable. We are among the few countries that launched
the elimination programme way before the targets set by the UN,” said Agnes
Mahomva, the EGPAF country director. “While it might look impossible, we
feel it’s achievable.”

Already EGPAF has been awarded the first of a five-year US$45 million grant
by the London-based Children’s Investment Fund Foundation to speed up the
rollout of more effective ARVs to reduce mother to child transmissions.

The US President’s Emergency Plan for Aids Relief announced an additional
US$75 million for the cause.

The Bill and Melinda Gates Foundation pledged US$40 million, Chevron US$20
million and Johnson & Johnson pledged US$15 million.

Medical doctor with EGPAF Tichaona Nyamundaya said by eliminating new HIV
infections among children it did not mean eliminating those who are HIV
infected but making sure that there are no children who are going to be
newly infected with HIV.

“It means as a country we are making deliberate efforts to reduce mother to
child transmission to less than 5% and reduce new HIV infections in children
by 90%. Currently we have more than approx 15 000 children who are newly
infected with HIV on a yearly basis. The elimination of new HIV infections
in children does sound ambitious but we can do it and it is achievable.”

He said EGPAF was working together with MoHCW on a communication and
advocacy strategy targeting different groups such as policy makers,
community leaders, health care workers, hard to reach groups and pregnant
women.

He said the new PMTCT guidelines recommend that pregnant women should book
their pregnancies as early as three months so that they can get PMTCT
services benefit from life saving medications.

Nyamundaya said: “We are encouraging the mothers to deliver within a
hospital or a clinic so that both the mother and baby can get appropriate
services to reduce the risks of mother to child transmission of HIV.”

“The mother is expected to give only breast milk (exclusive breastfeeding)
to the child for the first six months and to introduce nutritionally
adequate complementary feeding after six months to complement the breast
milk.”

“The new PMTCT guidelines are bringing hope to HIV positive breast feeding
women because children will be taking ARVs throughout the breastfeeding
period to reduce HIV transmission through breast milk.”

He said EGPAF will support the Ministry of Health and Child Welfare with
portable CD4 count machines that can be operated with a battery. These
innovative machines can be operated by non-laboratory personnel and do
reduce the time that a woman spends at a hospital, reduces number of
hospital visits as well as leading to timely initiation of  antiretroviral
treatment.

National coordinator PMTCT, HIV care and treatment in the Health ministry
Angela Mushavi said there was need for rapid testing facilities adding that
300 antenatal clinics out of 1 000 lacked facilities.

She said it was sad that not all babies exposed to HIV were being tested and
accused some health workers of defying certain ministry policies by
frustrating patients.

Latest IMF report paints gloomy picture

http://www.theindependent.co.zw/

Thursday, 23 June 2011 20:04

By Jimmy Girdlestone

‘O wad some Pow’r the giftie gie us
To see ourselves as others see us!’— Robert Burns.

FED on a constant official diet of the country’s vast natural resources
presenting an irresistible magnet to capital rich foreigners desperate to
profit from the current world commodity boom —  a potent combination of
circumstances which could not fail to lift Zimbabweans from their near
subsistence existence and into fortune — the IMF report on the latest
consultations with local authorities may well come as an unexpected major
disappointment.  The executive board, while welcoming the continuation of
economic recovery, albeit from an uneven and low base, as well as the
improvement in humanitarian conditions, concludes that “the recovery remains
fragile and enormous challenges persist”.
Such a verdict may be dismissed as no more than a thinly disguised
reiteration of unfounded, biased Western criticism of the country and its
prospects. Those of a more cerebral bent, however, will be more likely to
want an explanation as to quite why this influential and important
multilateral organisation has come to such an uncomforting judgement.  Since
the IMF’s prime function is to lend out cash to countries suffering a major
currency or capital account crisis, an insight into this aspect of Zimbabwe’s
economic activity would seem to provide the best starting point for those
genuinely seeking a convincing explanation for such a highly qualified
statement.
Since 2008 Zimbabwe has experienced heavy, annual deficits on its balance of
payments’ current account.  Notwithstanding favourable external conditions
and high commodity prices, merchandise exports, at US$3,382 million by last
year, had little more than doubled due largely to an uncompetitive and
uncongenial local business climate. Imports have risen at an only slightly
lower pace to a value of just more than one-and-a-half times that of
exports, financed by substantial humanitarian aid and short- term capital
inflows without which the overall balance would have been considerably worse
than the US$649 million of 2010. Even more tellingly, the current level of
monetary reserves has shrunk to under 13 days of imports, about equal to one
month of government expenditure, which is why the IMF continues to stress
the need for fiscal discipline to enable the build-up of precautionary
buffers to two months of budget expenditures. Zimbabwe, however, remains
deeply mired in debt distress with an unsustainable debt-stock of 118% of
GDP – mostly arrears at 80% GDP – at the end of 2010.
Without a doubt, however, the most severe jolt to any lingering national
complacency that might still remain after this survey of the country’s
external financial relations is provided by the IMF’s stark warning that
Zimbabwe’s position as a primary commodity producer and oil importer, with a
history of political and economic instability, weak institutions and the
absence of the lender of last resort, renders it extremely vulnerable to
terms-of-trade shocks.  In current international conditions of highly
volatile commodity and oil price fluctuations, rapid and substantial changes
in domestic liquidity conditions cannot be discounted, particularly in a
situation in which credit and deposit expansion is already forecast to slow
down significantly. Such developments would have very serious consequences
for the local banking system, the vulnerabilities of which are judged to
have increased.
In stark contrast to the anodyne statement from the Bankers’ Association
concerning the recent debacle at Renaissance Merchant Bank, IMF staff
investigations revealed that although overall, or on average, measurements
of risk in the sector are not altogether cause for concern. They frequently
conceal serious divergences in homogeneity of circumstance, not just among
banks in different fields of activity, but often among institutions
providing similar services. Many banks are weakly capitalised, particularly
some of the smaller institutions.  The quality of bank capital is weak
because of exposure, to the extent of 40% of their capital, to the
financially distressed Reserve Bank. Some bank’s capital is prone to
potential asset valuation losses because the value of their premises is
included in it and because of persistent operating losses.
The average solvency rate, at 15,3% in December 2010, was well above the 10%
minimum requirement. But seven smaller banks are undercapitalised and some
are even operating with negative capital. The value of nonperforming loans
tripled in 2010 and although the average reported non-performance of loans
remains below 5%, the ratio of smaller banks, particularly the
undercapitalised ones, ranges from 6% - 36%.
This suggests a lack of ability to assess loan quality, unsound lending
practices and poor risk management.  The IMF also noted that “routine
rollover of short term loans appears to be a common practice”.
The average liquidity ratio, excluding illiquid claims on the RBZ, exceeded
30% as of February 2011.  But it was below 20% for eight banks and below 25%
for 11 banks. Excluding illiquid claims on the RBZ and interbank claims, 15
banks had a liquidity ratio below 20%.
The report recommends that the plan to restructure the RBZ’s balance sheet
should be expedited; that the high liquidity risk urgently needs to be
addressed through “requiring a minimum liquidity ratio of 25%, or higher”;
and that the RBZ must intervene swiftly to enforce minimum capital and
capital adequacy requirements while banking supervision should ensure early
compliance with such minimum standards. Banking supervision should also
continue to improve stress testing of all banks and ensure sound loan
underwriting standards and practices.
Speedily implemented, these recommendations have the capability to raise
confidence in banking sector solvency and in the soundness of its individual
institutions – but not before time. The IMF already notes how smaller banks
have become more risk-taking, “reaching for lower-end and sometimes
unbankable customers, potentially heightening the volatility to bank income
and profitability”.
Robert Burns, the much acclaimed 18th century Scottish poet to whom this
article owes opening quote, hoped the gift he craved would free us from many
blunders and foolish notions. These would undoubtedly include discarding the
age-old fiduciary responsibility to savers, especially the elderly, so as to
be able to play, at the latter’s cost, the roulette wheel of speculative
banking.
Jimmy Girdlestone is a consultant economist with the Tetrad Group and
writes in his personal capacity.

Cotton buyers, farmers haggle over prices

http://www.theindependent.co.zw/

Thursday, 23 June 2011 19:43

COTTON  buyers and farmers are at loggerheads over prices producers feel are
too low, businessdigest has established.
A union representing farmers, the Zimbabwe Farmers Union (ZFU) is already
urging farmers to hold onto their crop until buyers pay more or come up with
plausible reasons why prices have come down.
In an interview with the businessdigest, the Vice President of Zimbabwe
Farmers Union, Mr Berean Mukwembe,  said prices in the region are quite
competitive as compared to 70 US cents which is being offered in Zimbabwe.
“I was in South Africa recently, they are paying close to 1, 80 US cents per
kg and Malawi 120 US cents per kg, so farmers in Zimbabwe have to be paid
more because our cotton is even better than the genetically modified cotton
of South Africa,” he said.
However, an authoritative source among the buyers said the complainants were
farmers with little produce and those who had never experienced a situation
where prices go down.
Prices in Zimbabwe are likely to rise owing to firm demand on the
international market, he said.
Cotton lint prices as depicted on the Cotlook A Index (International Cotton
Industry weekly newsletter) have surged from 78 US cents per pound last year
to 140 US cents per pound in the current year.
Cotton Ginners’ Association chairman David Machingaidze said: “Preliminary
indications show that the national hectarage could be around 450 000
hectares that surpasses the previous seasons which had 350 000 hectares
which produced a crop size of 268 000 tonnes.”
“This year’s global lint production was not adequate to keep pace with
global consumption, largely due to inclement weather in some of the world’s
top producing countries, such as Pakistan, Bangladesh, India and China,” he
said.
In his 2011 national budget presentation, Finance minister Tendai Biti said
cotton output is estimated to reach 260 000 tonnes in 2010, from 211 000
tonnes in 2009.
The promulgation of Statutory Instrument 142 of 2010, which protects both
cotton farmers and cotton buyers through prohibiting side marketing, has
built confidence in the sector.
As a result, contractors who had withdrawn from the sector in 2009 returned,
increasing the number of supported farmers. In 2011, cotton production is
projected to further increase to 300 000 tonnes.
The International Cotton Advisory Committee, a body comprising the world’s
cotton producing countries, has projected a seasonal average price of 156 US
cents per pound of processed lint. — Staff Writer.

“It was also mentioned that the major stumbling block to opening more
auction floors, especially outside Harare, would be the IT system to upload
and download information. Sales cannot start until all floors have uploaded
their data. There was a possibility of not getting buyers at remote auction
floors.  An opportunity for arbitrage could exist. It was mentioned that
with the current three auction floors, as a micro-industry, were currently
poaching manpower from each other,” read the minutes.
Experts also attribute congestion at the floors to a sharp increase in small
scale farmers. Official statistics indicate that small scale farmers had
grown to 52 000 last year from 1 500 at the start of the controversial land
reform exercise.

‘Security forces cause confusion at auction floor’

http://www.theindependent.co.zw/

Thursday, 23 June 2011 19:41

Bernard Mpofu

A PARLIAMENTARY portfolio committee on agriculture, lands, water and
resettlement has blamed Zimbabwe’s security forces for exacerbating
confusion and congestion at the country’s largest tobacco auction floor.
This comes amid a push by legislators for more auction floors, a decision
facing resistance from industry players.
A report on the operations of the Tobacco Industry and Marketing Board
(TIMB) and constraints faced by tobacco growers has revealed numerous
challenges at Tobacco Sales Floor (TSF), the largest auction floor by
volumes, making a lasting solution to perennial problems affecting the
cash-spinning business appear distant.
“There were abnormally longer and haphazard queues at the Tobacco Sales
Floors, a situation made worse by several lorries and trucks bearing police
and military plates which were bypassing the queues,” reads the first report
of the committee.
The committee, however, proposed that decentralising the auction floors to
Zimbabwe’s 15 major tobacco growing districts and educating tobacco growers
on the booking system, among other interventions, could minimise the
problems.
However, some industry players contend that taking the floors to the farmers
could reduce tobacco prices, which could result in tobacco price wars.
The TIMB, after completing a feasibility study on decentralisation last
November, this marketing season shelved its plans to embark on the project.
It instead opted for the decentralisation of booking offices to Mvurwi,
Chinhoyi, Marondera and Rusape. Last month’s minutes of the TIMB Board
production and marketing committee meeting with auction floors and buyers
reveal that tobacco merchants are not ready for more auction floors.
The buyers want tobacco deliveries to hit the 200 million kilogramme mark
before new players can come on board. Zimbabwe currently has three auction
floors — TSF, Boka Tobacco Auction Floors and Millennium Tobacco Auction
Floors — with tobacco deliveries this year expected to hit 177 million kgs.
Reports also show that to date the TIMB has received at least 10
applications from would-be auction floor operators.
Apart from competition for the few experienced buyers, the merchants warned
that increasing the number of auction floors — which would subsequently
reduce the tobacco selling and marketing period — would also put jobs on the
line for several casual workers in the sector.

Muckraker: Mudede’s fable won’t cleanse voters’ roll

http://www.theindependent.co.zw/

Thursday, 23 June 2011 20:22

MUCKRAKER is indebted to his colleagues at the Herald for providing the
following quote from Brigadier-General Douglas Nyikayaramba following his
eviction from the Copac house.
“In terms of expertise, someone who can say things without thinking, I am
the right man,” he declared.
What a gift to his critics! What a hostage to fortune! He clearly thought he
was a victim of a donor conspiracy. But his housemates didn’t agree.
“It will be very sad if we succumb to the terms and whims of these donors,”
he moaned in a bout of self-pity. “They want to use this constitution for
regime change like what they did in Ivory Coast.”
It was therefore necessary for “security people” (like him) to monitor the
machinations of the donors, he said.
“To show that these donors are not up to any good, they want to choose who
to pay in Copac. They want to influence the outcome of this process and as a
country we can’t allow that.”
It would be very unfortunate for the nation to throw away the investment the
country had made in him, he lamented. “The reason why they don’t  want me
there is because they want to smuggle in things that are  a security threat
and they are afraid that military personnel will see it and block it.”

To provide comic relief to this tearful episode, we had Didymus Mutasa
weighing in with his thoughts which are always good for a laugh. He felt a
compelling need to rush to the defence of service chiefs whom Morgan
Tsvangirai had told to put up or shut up if they wanted to participate in
politics.
Mutasa said the security chiefs had a right to freedom of expression just
like any other Zimbabwean.
“The generals I know don’t talk politics,” he said. “There could be a
problem of interpretation…”
Indeed there could. If Mutasa refers to the May 27 edition of this newspaper
he will find the views of Copac house evictee General Nyikayaramba spelt out
in plain English on the front page.
Nyikayaramba, who is commander of 3 brigade in Manicaland, told the Zimbabwe
Indepent Mugabe would win the next election and could not be removed because
he was “irreplaceable like a father in a family”.
The general said elections must be held this year because the inclusive
government had failed to look after the army.
“In our case we need elections like yesterday because it had created a lot
of challenges in the military,” he said. “We are not getting enough
medicines from the inclusive government,” he claimed. “Maybe they want the
soldiers to mutiny.”
“We are not getting enough money for rations and enough money for uniforms,”
he declared, “and it has all to do with this inclusive government whose
priorities are lopsided — they don’t understand the strategic benefits or
importance of having a robust defence system. We would rather have one
government.”
Should a serving officer be saying these things? Of course we were delighted
to have it on the record.
On calls for Mugabe to step down, Nyikayaramba said he believed that the
president should continue in power because he had sacrificed a lot for the
country.
“He is the leader of our revolutionary struggle and the struggle is still
on…”
Now which part of that did Mutasa not understand?

Last Saturday Registrar-General Tobaiwa Mudede claimed that the voters’ roll
was “clean” and his office was willing to accept anyone wishing to inspect
it.
Claims that it was not credible were unfounded, he said.
“No country in the world had a voters’ roll that was as 100% perfect as
Zimbabwe’s,” he preposterously asserted.
Claims of voters that are over 100 years old are surprising, he said. But
the Electoral Act did not discriminate against such people having their
names on the roll.
“You don’t want these people to attain 100 years? You don’t want them to be
alive?” he asked in response to a question about the large number of
centenarians on the roll.
“It is their right to vote…We will still advise them that it is their right
to vote.”
Recent reports have revealed that some 40 000 people over the age of 100 are
still on the roll together with small children and deceased persons. Many of
the centenarians are in President Mugabe’s home district of Zvimba. So are
many newly registered voters.
Then we had Rugare Gumbo declaring that the RG was the “competent authority”
to speak on the voters’ roll and no reasonable person should discredit such
observations.
“If he is saying it is in order, why should one doubt it?” Gumbo asked. “We
need not operate on speculations that are not correct when the right person
is there.”
So we can all relax. The RG has spoken and everything is in order. Just as
it has always been. Never mind that “Mudede” and “competent” are not two
words you often hear together.

The Daily Telegraph’s interview with Emmerson Mnangagwa, carried in the
Herald and the Daily News, was enlightening.
“We discovered that our differences with our opponents are not that
 serious,” he said, “and that we can work together without too many problems
in cabinet as well as in government generally.”
Is this what President Mugabe and the Central Committee have been saying? It
doesn’t sound much like it.
Mnangagwa pointed to economic recovery and suggested that elections were
likely to be held in February next year, assuming that a referendum is held
first which results in public approval.
He did cite one outstanding issue in this otherwise glowing account.  “There
are still foreign broadcasts into Zimbabwe in our local languages that are
spreading hate speech which agitate for regime change,” Mnangagwa claimed.
Why wasn’t he asked about the hate speech emanating from ZBC and the station’s
refusal to allow different voices to be heard? Then there were Mnangagwa’s
own threats to use Aippa measures against the Standard.
We were interested to note, by the way, that he is No 12 in the party
hierarchy, not No 4 or 5 as is generally assumed. He was, he said, “just a
very humble person”.
Sounds like something out of Dickens!

Meanwhile, with reference to the above, a more general point needs to be
made. There is a danger of politicians threatening to use the Zimbabwe Media
Commission as a weapon in their wars with independent newspapers. It is
essential that the ZMC is not used or abused in this way because there is a
danger of it losing its credibility if it submits to the will of
party-political demagogues of whatever hue.
Some of Zimpapers’ columnists must have been surprised to hear Mnangagwa
describing Morgan Tsvangirai as “a very sound, sober person”.
“I have had no problem with him,” he said.
Why did the Herald in its account omit the 400 hectares the minister
admitted to acquiring as part of land reform which he described as “a
question of justice”. Interestingly he did not think the British had any
inimical intentions towards Zimbabwe — another point Zanu PF columnists may
have difficulty with!
But as a parting shot the Herald’s reporters managed to smuggle the
following paragraph into their copy.
“Statistics from the ZRP have also shown that the MDC-T is behind most cases
of political violence in the country.”
Has anybody provided a detailed analysis of these statistics?

Muckraker was a tad surprised by the news that Prince William and his wife
have taken an entourage of only seven to North America for the royal tour of
Canada and the US.
They are travelling light to save the British and Canadian taxpayers
unnecessary expense.
Will somebody tell our royals this.

We are pleased former Malaysian PM Mahathir Mohamad found time to meet
President Mugabe on the sidelines of the Langkawi International Dialogue. We
recall the cozy pictures of the two of them at previous meetings. Those days
seem a lifetime away. Now our leader has to share VIP space with President
Jakaya Kikwete of Tanzania and PM Sibusiso Dlamini of Swaziland, among
others who met host PM Najib Razak for a photo opportunity.
We hope they were able to compare progress in their respective countries
since independence. That should be salutary.
In his address Najib said good governance was vital to economic growth.
“Some people are fearful of the uncertainty that change brings; others are
threatened by having to do things differently,” he said. “A true leader must
be able to address these concerns and obstacles and to overcome this
resistance to change.”
Former president of the Malaysian Bar Council Ragunath Kesavan said some of
the invitations could be seen as condoning abuse.
“We should not engage with Mugabe, he said. “We should not add legitimacy to
this international pariah. It will be seen as condoning and sympathetic to
what Mugabe is doing.”
Najib justified his invitations to Mugabe and Sudan’s al-Bashir on the
grounds that Malaysia could play an informal role to help influence certain
policies and actions.
Mugabe had been an active participant in previous Dialogue conferences,
Najib pointed out, and it was still useful to invite him “although we are
acutely aware of his position vis-a-vis the Commonwealth and many other
countries”.
Weren’t we led to believe in 2003 that withdrawal from the Commonwealth was
a heroic measure? What would its advocates in Zanu PF call it now?

Finally, as the nation has been mourning the death of Edgar Tekere,
Muckraker recalls an amusing anecdote from him when Minister of Manpower
Development  in the early 1980s. He described UZ as “a centre of chronic
eclecticism”.
Indeed, so we wonder what he would make of it now! Still chronic?

Eric Bloch: Looming demise of mining

http://www.theindependent.co.zw/

Thursday, 23 June 2011 20:20

IT is widely believed that, as recently stated by the Minister of Mines and
Mining Development, Obert Mpofu, “the mining sector is key to economic
recovery”.
Indisputably, that could, and should be so.  Currently, mining represents
20% of Zimbabwe’s Gross Domestic Product , and accounts for 65% of exports.
It is a major employer of labour, and has very considerable input to the
downstream economy, including the industrial, distributive and service
sectors.  This contribution to the economy is significant, and the potential
for extensive growth in that contribution is immense.

As stated by Mpofu: “Zimbabwe is yet to achieve maximum benefits from its
mineral resources, due to insufficient growth and unsustainable development
...”  That is greatly so for, despite the high proportion of the prevailing
economic activity that is attributable to mining, the extent of exploitation
of Zimbabwe’s vast mineral resources is nonetheless miniscule as compared to
that which it could be.

Zimbabwe is endowed with a  considerable wealth of gold, platinum, diamond,
nickel, chrome, lithium and methane gas deposits, in addition to innumerable
other minerals and precious and semi-precious stones, and the extent of
exploitation thereof is minute as compared to that which is possible.

The prospects of realising the  potential of the mining sector were, until
very recently, bright.  Although a prerequisite of achieving a massive
increase in mining production is very extensive funding (of at the least
hundreds of millions of dollars, if not more), the potential of accessing
that funding was good.

Whilst Zimbabwe is devoid of the money required to capitalise the mining
industry to meet the costs of development and of the necessary equipment,
there were innumerable international investors who recognised the great
opportunities.

Mining houses from South Africa, Australia, Canada, USA, various countries
in Europe and in the Far East were all enthused at large-scale investment
into Zimbabwe. That investment would increase the mining sector’s output
exponentially.

Billions of dollars of foreign exchange earnings would be realised, over and
above the invested funds.  Yields would be substantially enhanced by the
transfer of internationally developed, state-of-the-art, mining technology.
Employment would be created for many thousands of Zimbabweans.

The mines and their workers would be expending considerable amounts with the
retail, wholesale, manufacturing, and service sectors.  Government would
benefit from substantial inflows to the fiscus of mining licence fees,
mineral royalties, taxes on the profits of the mines, the incomes of the
mines’ employees, and the profits of the downstream suppliers to the mines
and to the workers of the mines.  There would be substantial indirect tax
(Vat, customs duties, etc) revenues from the sales of those supplies.

However, government has recurrently demonstrated its tremendous ability to
pursue nationally suicidal policies, and it has done so yet again by raising
impenetrable barriers to accessing the gargantuan foreign investment that
was poised to flow into Zimbabwe.

Instead of pursuing the uncontestable much needed indigenisation of the
Zimbabwean economy and the economic empowerment of the Zimbabwean people in
a constructive, beneficial manner, it enacted legislation which would be a
near absolute deterrent to attaining that investment which would ensure the
realisation of mining potential and outstanding growth.

Not only did it do so in a disastrous manner, but also in myopic disregard
for law.  It contemptuously disregarded the provisions of Zimbabwe’s
Constitution on the protection of property rights, on fair and just
penalties, and others key to investor confidence.

In particular, it requires that non-indigenous ownership of mining
operations be limited to a maximum of 49%, with the majority stake in all
mining enterprises being held by indigenous Zimbabweans, inclusive of a
portion thereof being held mandatorily by designated state enterprises.
Few, if any, potential investors are unwilling to be linked to indigenous
co-investors.

But they require that, on the one hand, they be able to determine who their
co-investors will be and, on the other hand, they cannot accept that they
invest large amounts of capital, and effect proprietary technology transfer
to Zimbabwe whilst being accorded no control over the venture in which they
are investing.

To add insult to injury, government intends that for those amounts already
invested by non-indigenous mining investors, these investors are to be only
minimally compensated.  In determining the amounts to be paid for the
enforced disinvestment, the value is to be reduced by an ascribed value for
the underlying mineral resources, which are perceived to be state assets.

In prescribing such a valuation formula, government is studiously and
obliquely ignoring that it is already compensated for the value of those
minerals by the considerable amounts payable by the mining enterprises by
prescribed charges for mineral rights, and by royalties on all mining
receipts (over and above the direct and indirect taxes payable by the
mines).

This has not only alienated existing investors in mining, but has totally
demotivated intending investors, who have been driven to lose any and all
interest in investing in Zimbabwe and to pursue alternative investment
opportunities elsewhere, including in Zimbabwe’s neighbouring states.

As a result, instead of achieving economic empowerment for the tragically
stressed and hard-pressed Zimbabwean masses, government is further
disempowering them.

Their poverty, suffering, and intense distress can only intensify, and the
economic upturn and recovery tentatively embarked upon in the last two years
wholly reversed.

If government has even the slightest modicum of realism, and of genuine
intent to improve the circumstances of the Zimbabwean people (with many
doubting that government has any such realism and intent), then it will very
belatedly modify its rigid and destructive stance on indigenisation and
economic empowerment in general, and that of the mining sector in
particular.

It will, as must be done, pursue indigenisation and economic empowerment
constructively, investment-conducively, and justly.

Failure to do so can only result in the looming demise of mining, and of the
economy as a whole. Distressingly, however, government’s track record of
being able to acknowledge error, and to address and reverse error
effectively, does not suggest that it has the maturity to do so.

Sadc tightens reins on Zanu PF’s options

http://www.theindependent.co.zw/

Thursday, 23 June 2011 20:19

By Brian Raftopoulos

THE excitement over the resolutions of the Sadc Troika meeting in
Livingstone, Zambia, at the end of March, was largely focused on the
stronger stance taken by the organ over the abuses of the Robert Mugabe
regime, and more particularly the continued obstacles placed by Zanu PF
over the implementation of the Global Political Agreement (GPA).
In effect, however, the Livingstone resolutions brought into effect the
major strength of the Sadc mediation, which has been to lock the Mugabe
regime into structures of accountability. Whatever the weaknesses of the
GPA, and there are many, it has forced Zanu PF into closer accountability
for its behaviour at different levels including cabinet, parliament, Jomic,
the constitutional reform process, Sadc, the AU and its relations with the
West.
For authoritarian parties like Zanu PF having to answer to various fora is
anathema, as they provide varying means of eroding the monopoly of power
that the regime has become completely accustomed to.
The accumulation of small reforms and the slow dispersal of power provide a
major challenge for such structures of authoritarian power, as they provide
the possibility of a cumulative momentum of dissent that can be very
difficult to control.
When combined to the major challenge of the succession problem in Zanu PF,
now an urgent issue in light of Mugabe’s waning health, these factors have
pushed Zanu PF into emergency election mode.
The challenge for Zanu PF since the signing of the GPA, and more urgently
following the Livingstone meeting, has been to decide on what strategies to
deploy in the next election campaign. The party’s recidivist impulse to
return to violence is clearly very strong, particularly given the increasing
control of the party and the state by the securocrats.
Moreover, the reports of various human rights organisations have shown
growing evidence of low level pre-election intimidation emerging in the
country, designed to pre-empt any forms of opposition activity in the public
sphere, with the spectre of North Africa clearly haunting the calculations
of the military-political elite.
The Zanu PF election campaign message has concentrated on the dual issue of
the indigenisation and anti-sanctions campaigns, with the connection being
that both are designed, in the party’s view, to confront the continuing
threats to national sovereignty.
However, whereas in the period between 2000-2008 the message around land
reform had some purchase both in the country and in the region, the recent
attempt to reload the message in a different form has proved much more
hollow both nationally and regionally.
The stern rebuke of Sadc at the Livingstone meeting placed the issue of Zanu
PF violence and coercion at the forefront of its resolutions. Moreover, the
resolution to appoint a team of officials to work with Jomic to ensure the
monitoring, evaluation and implementation of the GPA was a direct challenge
to the Mugabe regime’s persistent rhetoric on national sovereignty.
The frantic, angry and strategically stupid attacks by Zanu PF spokespersons
on the Livingstone position, Sadc, and South African President Jacob Zuma,
indicate the very real threat that the Sadc position holds for Mugabe’s
party. The once taken-for- granted regional solidarity against the West is
no longer so easily available, and at a stroke a key part of the Zanu PF
strategy over the last decade has been placed under threat. The vehement
lobbying by Zanu PF representatives ahead of the full Sadc summit in Sandton
on 11-12 June was another indication of the panic that the recent Sadc
position has caused in Zanu PF.
Moreover, the resolutions of the Sandton meeting notwithstanding, the claims
of the state media in Zimbabwe largely confirmed the resolutions of the
Livingstone summit, even if the language of the communiqué was calibrated in
more moderate terms.
More particularly, the Sadc summit in South Africa confirmed the Livingstone
resolutions through the facilitator’s situation report, confirmation of the
decision to appoint Sadc representatives to join the Jomic team, and through
its commitment to the election roadmap. Both the Livingstone and Sandton
meetings thus confirmed the central purpose of the mediation and the Global
Political Agreement, namely the establishment of conditions for generally
acceptable elections in order to settle the central problem of state
legitimacy in Zimbabwe.
Notwithstanding the continuities in the objectives of the mediation from the
(Thabo) Mbeki to the Zuma administrations, the one major difference between
the two, as South African analyst Siphamandla Zondi has noted, has been that
while Mbeki’s emphasis was placed on building consensus among the primary
actors in Zimbabwe, Zuma has complemented this by his concentration on
building a stronger regional consensus against the obstructive behaviour of
the Mugabe regime.
In particular, Zuma has developed closer relations with the Angolan
president, who always felt slighted and marginalised by former President
Mbeki. Zuma’s strategy was also determined by Zanu PF’s attempts to
undermine the ANC in the region in order to ensure the solidarity of the
region. There has now been a shift in this regional balance that has also
been affected by the more effective lobbying in Sadc by both MDCs, and the
greater respect they have earned in the region since 2008.
The fact that the West was largely marginalised in the Sadc mediation also
allowed Zuma to build a more effective African consensus to take a stronger
stand against the abuses of Zanu PF. This factor is one of the key
differences with the current situation in North Africa, the Middle East and
particularly Libya, where Western intervention, both diplomatic and
military, has clouded the issues much more for the opposition.
Western intervention in the Middle East is of course dictated by the major
issue of oil reserves, its strategic military positions in the region, and
the position of Israel, all of which dwarf the West’s interests in
democratisation in the region. The Mugabe message peddlers have not been
slow to point out the duplicity of the West on the democratic agenda, but
Zanu PF’s depravity on this issue has removed the sting from any critique it
once offered in this area. Progressive anti-imperialism abroad cannot long
outlast vicious repressive practices at home.
Sadc and the democratic forces in Zimbabwe must now move to ensure a broad
consensus with the West in implementing all key aspects of the GPA, with the
regional body leading the construction of such a consensus.
Zanu PF must be left with little doubt that any further attempts to
forestall the GPA through violence and repression will be met with a more
unified condemnation that will leave little room for continued unilateral
actions. Such pressure may also lead to more realistic political discussions
between the parties that will deal not only with elections processes but the
possibility of transfer of power, in which area both the mediation and the
GPA was always very weak.
Thus the role of the military security sector has to be dealt with by Sadc,
even if it is unrealistic to expect major security sector reform in the
pre-election period. Such reforms are a long-term process, but at the
minimum the role of the security sector in the elections process and
pre-election violence must be placed under close enough scrutiny to make it
a non-viable election strategy for Zanu PF.

    Brian Raftopoulos is the Director of Research and Advocacy, Solidarity
Peace Trust.

Why AirZim must be liquidated

http://www.theindependent.co.zw/

Thursday, 23 June 2011 20:17

By Taurai Chinyamakobvu

DOES Zimbabwe really need a national airline? Or does Zimbabwe need an
airline service?
Without splitting hairs, the two questions address different issues. Indeed
Zimbabweans need an airline service. But they do not need AirZim.
It is highly probable that beleaguered AirZim is technically insolvent, and
should simply be liquidated. Why the firm is still in existence in spite of
so much corporate decay is not just mind-boggling, but also mind blowing.
Despite its safety record we have to face the moment of truth that the case
for Airzim’s continued existence is now very weak. I will explore why this
is the best way forward.
First, clearly the airline is probably technically insolvent. One does not
need to see the balance sheet of the parastatal to make this conclusion.
Revelations in interviews by the chairman and acting chief executive officer
reveal that the company is not only heavily indebted to its employees,
banks, fuel suppliers and the International Air Transport Association
(Iata), but also to a plethora of other creditors. Given its exposure to
creditors, Air Zim should seek voluntary liquidation or file for bankruptcy
protection.
This brings to my mind the case of Royal Bank and First Mutual Life in 2004,
when FML sought to place the bank under liquidation. In the same vein,
because AirZim’s liabilities are potentially much greater than the net
realisable value of its assets, it should be wound down to protect creditors
and to avoid a bailout by the government which in effect would be a taxpayer
bailout.
In a recent interview, the AirZim chairman disclosed that the airline owed
creditors US$101 million.He also disclosed that the airline had monthly
revenues of US$4,5 million  against expenses of US$6,5 million.
Extrapolating these figures over one year shows that the airline will make a
loss of about US$24 million.
Second, AirZim represents the height of corporate incompetence and
managerial ineptitude, and malfeasance even at corporate and shareholder
level. AirZim has changed chief executive officers probably more than any
other company I can think of in Zimbabwe, many of them lasting no more than
two years. The board has also been shuffled and reshuffled many times yet
the airline keeps bleeding.
Management has failed to create rapport with employees. Clearly, it does not
appear as if there is mutual trust between the managers of the firm and the
rest of the employees. It is also very obvious that all AirZim employees
have no sense of duty to the company, the country and its vision, if ever
there is a vision at the airline.While many other airlines have entered into
alliances such as Sky team and Star Alliance among others, AirZim is not
known as a member of any alliance.
The shareholder at AirZim has demonstrated even more overwhelming
ineptitude. There is no way to separate the ineptitude of the management at
AirZim from the ministers that oversee the parastatal. Granted, these
ministers have changed over the years, yet the reign of each one of them
means they presided over the successive decay of the airline over the years.
It is also the same ministers who shuffled and reshuffled board after board
without overseeing a radical turnaround programme and overseeing
implementation of such a programme. The government also directed AirZim to
embark on certain unviable routes with neither the strategic stamina nor
adequate resources to compete with larger airlines.
Third, a national airline is a flag carrier. Under normal circumstances,
AirZim should be an ambassador of the national brand. Yet many Zimbabweans
are not very proud of flying AirZim for many reasons, chief among which is
lack of reliability. The state of Air Zim’s aircraft, operations and
financial position renders its “national branding” role very untenable. The
recent, rare but punitive action by Iata when it barred the airline from
participating in the international financial and booking pool for owing
close to US$300 000 was a blow to the national brand. Iata told all travel
agents to “immediately stop all ticketing and refund transactions”.
Internationally, there is no worse publicity for any airline than this.
It could be argued that AirZim is good for resuscitating tourism. That view
remains valid until you check the tourism arrival figures and revenues,
which are actually increasing at the same rate as the airline is getting
embattled. It’s a remarkable inverse relationship!
For decades, the government has been inexplicably holding on to AirZim,
despite its recurring losses. At the time of writing it had been reported
that a cabinet minister had disclosed that AirZim was too rotten to sell. He
described it as being in such a state that no investor would want to buy it.
If it is in such a state, then why does the government want to keep it? If
the government keeps holding on to the airline, the taxpayer will eventually
foot the capital deficits that emanate from poor management.
The logical route therefore is not to keep pumping money into this airline.
Tribal wisdom of the Dakota Indians has it that when you discover that you
are riding a dead horse, the best strategy is to dismount. You may change
the riders; appoint a committee to study the horse; arrange to visit other
countries to see how others ride dead horses; lower the standards so that
dead horses can be included; reclassify the dead horse as “living impaired”;
hire outside contractors to ride the dead horse; try to harness several dead
horses together to increase the speed; provide additional funding and
training to increase the dead horse’s performance; do a productivity study
to see if lighter riders would improve the dead horse’s performance; or
declare that as the dead horse does not have to be fed, it is less costly,
carries lower overheads, and therefore contributes substantially more to the
mission of the organisation than do other horses.
You may even argue for rewriting the expected performance requirements for
all horses, but at the end of the day, you will have to dismount. That’s
what needs to happen at AirZim. That airline should be liquidated as of
yesterday. That way, the government and the taxpayers will cut their losses.
Creditors will lay claim over the assets. Besides some employees who will
lose jobs, Zimbabwe will remain a destination for airlines. Tourism will
continue and the fiscus will have one less company to bail out.
Liquidating a national flag carrier is not new. Zambia liquidated its Zambia
Airways in 1995. Here in Japan, the national flag carrier, Japan airlines,
filed for bankruptcy protection in 2010. That strategy allowed the airline
to restructure its debt and staff costs as well as pension obligations. It
is now exploring alliance partnership with other international carriers.
To provide a contrast, one has to look at airlines that are doing very well
in Africa. Ethiopian Airlines keeps growing and serves 61 international
destinations, and will soon be joining the Star Alliance. It has provided
training to many pilots from other countries too. It also plans to buy 10
Boeing 787 Dreamliner aircraft, the first African country to announce such
plans. Kenya Airways provides another sterling example of a well run
airline.But the way forward for AirZim is simple: liquidate.

    Taurai Chinyamakobvu is a consultant, scholar  and analyst based in
Japan. He can be mailed at tchinyamakobvu@gmail.com .

Moyo’s scare tactics must be disowned

http://www.theindependent.co.zw/

Thursday, 23 June 2011 20:11

By Clifford  Mashiri

YOU don’t have to be a rocket scientist to tell that Jonathan Moyo’s latest
outburst sounds like a veiled threat of a coup in Zimbabwe, albeit he is
neither a soldier nor an ex-guerrilla.
After reading his latest instalment, “Livingstone report now a matter for
historians”, (New Zimbabwe, June 19) it is clear that Moyo has crossed the
line by warning the people against negotiating a roadmap for free and fair
elections.
Moyo warns of “the looming danger which (he does not specify) …will happen
as sure as tomorrow is coming… that what is currently a political process
will become a national security matter.  If that happens, all hell will
break loose.”
What does he mean by that? is Moyo threatening a military coup in Zimbabwe?
Does he mean resorting to “ruling through Government By Operations led by
jittery security arms” as he once claimed, saying they (Joint Operations
Command) “implemented an undeclared state of emergency and roped in the
Reserve Bank to pursue an unprecedented law and order approach to monetary
policy in order to criminalise Zimbabweans…to inhuman and barbaric attacks
in the name of restoring order reminiscent of the Gukurahundi days”. (Moyo
in his article “Why Mugabe should go now” — October 29, 2006).
Unless the military disowns his scare tactics, they risk being complicit to
what amounts to threats to democracy. By remaining silent, Joc could become
Moyo’s puppets by default by virtue of his two major assets — a fluent
command of English and a deceitful skill at spinning.
Moyo deliberately misrepresents Zimbabwe’s tragic electoral history and
curiously apportions blame for the five-week delay in announcing election
results to foreign countries. Has he forgotten what he said in April 2008?
“If there is one sobering thing that can be unequivocally said about why the
Zimbabwe Electoral Commission (ZEC) has scandalously delayed the
announcement of the March 29 presidential election, it is simply that
President Robert Mugabe did not win the election and is now desperately
trying to steal the result through an unjustified recount because he does
not have any prospect of winning a run-off or a re-run,” (Moyo’s article
titled “Mugabe can’t stomach defeat”, April 13, 2008).
Moyo did not stop there.
“Against this background, ZEC’s perverse delay in announcing the result of
the presidential election leaves Zimbabweans and the international community
with only one gloomy conclusion: the defeated Mugabe and his shocked
hangers-on are using the delay to scheme up a dirty game plan whose
nefarious purpose is to reverse Tsvangirai’s electoral victory with the
collusion of ZEC at all cost and by any means available.
This is being done under a barrage of confused and confusing Zanu PF talk
around a recount, runoff or rerun when the result has not been announced,”
Moyo said.
Ironically, that time Moyo did not accuse those he called “the UK, US and EU
imperialists” of regime change!
Contrary to Moyo’s claim that “Zimbabwe is capable of holding free, fair and
credible elections because it has the legal and institutional bedrock upon
which it has done so in the past,” preliminary findings of an empirical
study which I am conducting show that the administration of Zimbabwe’s
elections has been militarised, politicised, flawed and the elections were
fraught with electoral malpractices as evidenced by, inter alia, violence,
murder, rape, scores of electoral petitions and the voters’ roll which is
grossly defective.
Observations by one scholar revealed the bizarre case of Bulawayo, where the
number of spoilt ballots at a polling station was higher than those of the
winning candidate and that it took ZEC only two days to announce the final
results for the June 27 2008 run-off, and within a few hours the winning
candidate had been crowned the President of Zimbabwe although it took five
weeks to announce March 2008 results!
Furthermore, Professor R W Johnson of the South African Institute of Race
Relations recently announced that no fair referendum or election can be held
in Zimbabwe on the basis of the current voters’ roll because it has about
2,5 million fictitious voters on it.
If anything is now history, it is Moyo’s parliamentary seat of Tsholotsho
which he should have resigned after he crossed the floor to Zanu PF because
he is now short-changing the people of Tsholotsho who deserve a fair
representation in parliament. In fact the Electoral Law Act should be
amended to clearly state that you lose your seat on crossing the floor, full
stop.
After all the people of Tsholotsho did not know Moyo before he was imposed
on them by Mugabe, who, in his own words at the funeral of the late Witness
Mangwende at the National Heroes Acre in Harare in May 2005, said the chiefs
of Tsholotsho, where Moyo was standing as an independent candidate after
being barred from representing Zanu PF, told him (Mugabe) that they did not
know Moyo until he was imposed on them by the president.
Of course Moyo knows very well that he would lose immunity from prosecution
for any alleged offences should he resign as an MP. He is also aware of the
fact that there should have been a by-election in Tsholotsho by now, were it
not for the Global Political Agreement despite lambasting it religiously
whenever he wakes up on the wrong side of the bed.
Two requests worth making are, first for a National Day of Prayer so that
Moyo’s unspecified threat of “the looming danger ...which if it
happens...all hell will break loose” (synonymous with a coup?) does not
materialise; secondly, that Zanu PF should take away his internet access so
that he does not cause alarm and despondency in the country through his
articles.
However, it’s unlikely they will succeed because Mugabe told a rally in
Masvingo in February 2005 that he and Vice President Joice Mujuru had spent
nearly one- and-a-half hours trying to convince Moyo to step down and allow
the politburo to have its way on the candidate for Tsholotsho constituency,
but he had refused because “ ane musoro wakaoma sedamba” (he is thick
headed).

    Clifford Mashiri is a London-based political analyst.
zimanalysis2009@gmail.com .

Editor's Memo: Sadc: Beyond solidarity and rhetoric

http://www.theindependent.co.zw/

Thursday, 23 June 2011 20:39

Dumisani Muleya

THE recent Sadc summits in Livingstone and Sandton showed the regional
grouping is maturing with age like good wine or cheese at room temperature.
Traditionally Sadc’s main objective was the political liberation of Southern
Africa.

The founding members — Frontlines states — wanted to reduce economic
dependence on apartheid South Africa, while spearheading the liberation of
the region.

The formation of Sadcc was the culmination of a long process of
consultations by the leaders of the then only independent Southern African
states, Tanzania, Botswana, Zambia, Angola, Mozambique, Lesotho and
Swaziland, working together as frontline states. In May 1979 consultations
were held among ministers in Gaborone, Botswana. Subsequently a meeting was
held in Arusha, Tanzania, in July 1979 which led to the establishment of
Sadcc.
When it was still Sadcc, the regional body mainly pursued political
liberation of South Africa and Namibia.

When Namibia became independent in 1992, regional leaders on August 17,
1992, at a summit in Windhoek, signed the Sadc Treaty and Declaration that
effectively transformed Sadcc into Sadc. The objective of the organisation
also shifted to include economic integration with the anticipation of the
advent of democracy and freedom in South Africa — the biggest economy on the
continent.

Over the years Sadc at face value remained what its unkind critics always
called a “club of dictators” or “toothless bulldog” despite the fact it was
gradually transforming under the surface.

The end of the Cold War and the collapse of one-party states and the demise
of presidents-for-life (Samora Machel used to taunt Kamuzu Banda as “Mr
President-for-Life” in meetings), coupled with the advent of multi-party
politics and economic liberalisation, influenced Sadc in many ways towards a
new direction.

The liberation of South Africa and the rise of Nelson Mandela in 1994 also
played a major role in re-orienting Sadc. Of course, other leaders before
Mandela had done a lot but the South African statesman’s new leadership of
the regional body based on principles of democracy and human rights changed
the dynamics and ultimately the situation. Efforts at reform in Swaziland
and Lesotho, for instance, intensified during the Mandela era.

It is instructive  that South Africa, now under the leadership of Jacob
Zuma, was at the forefront of the recent watershed summits in Livingstone
and Sandton where Sadc took a new direction of speaking truth to power and
agitating for reform and democratic dispensation in Zimbabwe. As the façade
of revolutionary solidarity and anti-imperialist rhetoric, given more
prominence by the older generation than democracy and economic development,
wanes a new political culture seems to be emerging.

Sadc leaders are now prepared to engage frankly and forthrightly as they did
in Livingstone and Sandton. In Livingstone Sadc leaders said they had
appreciated the “frankness” with which Zuma compiled and presented his
report on Zimbabwe. The report was hard-hitting. It was out of character for
Sadc leaders to take a new approach to resolving internal issues. Everyone,
including President Robert Mugabe, was stunned. Mugabe described the
Livingstone resolutions as a “bombshell”.

Confronted with this objective reality, Mugabe tried to fight the new
approach in which his counterparts finally expressed their “frank” views
about his leadership and rule. Mugabe and his diehards launched angry,
hysterical and strategically reckless attacks on Sadc leaders, particularly
Zuma after the unforeseen and dramatic shock treatment in Livingstone.

Sadc had for the past 10 years ducked and dived over the Zimbabwe question.
They did not want to tackle Mugabe’s authoritarian system which stood as a
monument of political repression and economic regression at the heart of the
region. Leadership and policy failures, exacerbated by disputed elections
and human rights abuses, are at the root of Zimbabwe’s current problems.

No doubt there had been many other honest and candid engagements before
Livingstone and Sandton, but a fundamental shift — which comes with the
generational change in leaders and ideas — appears underway but the question
is will it hold?

It is interesting Mugabe — the only founding Sadc leader still remaining
(Nyerere, Machel, Kaunda, Masire and others are all long gone) — is there to
witness the change, painful as it is, while playing a crucial albeit mainly
obstructive role in managing and shaping it. After Livingstone and Sandton,
Sadc leaders must now irreversibly move beyond solidarity and rhetoric to
transform the organisation into a grouping based on democracy, human rights
and economic progress. Zimbabwe is the test case.

CandidComment: Corporates finally wise up to disposal

http://www.theindependent.co.zw/

Thursday, 23 June 2011 20:35

Itai Masuku

FINALLY, our corporates are now getting rid of their fat. Not that they are
all to blame for having accumulated it in the first place, but given the
direction, or rather lack of it, of Zimbabwe’s economy over the past decade,
it should be expected.

Corporate history systems seem to be perennially caught up in cycles of
acquisitions, mergers, and demergers. One would hope that in Zimbabwe’s
case, once we have seen off the current phase of demergers, disinvestments
etc, we remain that way for a while so that our companies really focus on
their core business thereby optimising  on their competitive advantages.

Looking at all the results that are being released in the current season,
company disposals have become commonplace. However, they seem to be driven
more by tight liquidity challenges rather than focus on core business. The
core business focus may simply be a by-product. Most companies with a number
of business units seem to be rationalising and streamlining their business
operations, mainly to raise cash.

With dollarisation, many of those operations have lost relevance in terms of
presence in many company structures and now lack business sense. Disposal of
non- performing business units or assets has become a song in many
companies, listed or private.

Listed companies which have taken this route lately include AICO, which
disposed of Scottco and Exhort as the company tries to major on core cotton
business. PG Industries is in the process of disposing of loss-making Mutare
Board & Paper, Mitec and non-core properties valued at US$1 million.

Kingdom Bank disposed of DCZ as the bank consolidated its operations as
running a commercial bank and a discount house at the same time did not make
sense given also the need to raise capital requirements on the separate
licences.

Steelnet Ltd disposed of Tube & Pipe and excess land holdings in a bid to
raise working capital and expunge short term debts. CFI is selling Dore &
Pitt, an irrigation pipe manufacturing company. Chemco disposed of loss
making Farm-A- Rama. And the list goes on.

Some of the business units were acquired or established during the Zim
dollar era as holding companies followed the wave of trying to profiteer
from price arbitrages and distortions which existed due to fluctuations in
foreign exchange rates.

Others were established as property holding companies to preserve value as
hyperinflation took its toll.

Some companies were merely established as foreign currency conduits as they
could trade in almost everything which could deal in the much needed forex
and were also used in evasion of regulatory authorities as they sheltered
non permissible trading activities.

As the economic and political environment deteriorated, foreigners and white
businesses people left the country, and offered their companies cheaply to
friends or interested companies. Thus, buying into these companies could
have been necessitated by the need to acquire a good business model at
basement prices.

But many who bought into these businesses knew absolutely nothing about the
business and lacked the dedication to invest more as they simply enjoyed
profits ultimately running them down. These are some of companies being
disposed of as holding companies would have milked them and are now trying
to sell a shell.

Current tight liquidity challenges have also precipitated company disposals
as there is lack of capital injection in ailing companies. The trick is to
sell the company before its price falls even below the net asset value.

Comment: Hate campaign must be rejected

http://www.theindependent.co.zw/

Thursday, 23 June 2011 18:55

ZANU PF at this juncture perhaps needs Professor Jonathan Moyo to do its
bidding to salvage the party from the major setback of Sandton, but the
country — which is yet to recover from the catastrophe going back 10 years —
certainly does not need his contribution to national discourse; more so if
it reminds us of the dark days of violence, media clampdown and state-led
repression.
Moyo, who led the Zanu PF advance team to the Sandton Summit in South Africa
a fortnight ago, is a sore loser. He does not want to admit that the tide
has turned and that Sadc no longer treats President Robert Mugabe as a
regional hero. Moyo, in what has become his notorious propensity, has taken
to throwing punches at every person contradicting the Zanu PF line that his
party suffered a  major diplomatic defeat in South Africa.

Moyo is currently on a crusade to have Prime Minister Morgan Tsvangirai and
senior party official Jameson Timba arrested for calling President Mugabe a
“liar”. In an article in the Sunday Mail this week, he launched vitriolic
attacks on the private media.

This is a throwback to the years of Zimbabwe’s dark past, when Moyo
unashamedly conducted attacks on the media by drafting repressive laws which
saw the arrest of journalists. His signature act was the closure of the
Daily News in 2003.

There is a sense of déjà vu here. Moyo is currently descending into that
dangerous low where he is seeking to build a case against the private media
which he views as a bulwark against his maladroit and retarded propaganda.

State media institutions have been recruited into this malevolent drive with
ZBC on Tuesday helpfully repeating silly claims that the private media had
received funding from the West. The state broadcaster also claimed that as a
result of the funding, private media institutions were selling their papers
for a song and vendors were handing out papers for free. Television footage
accompanying the preposterous claims showed NewsDay vendors.

The agenda is clear: there is an attempt to build a case against the private
media. They are disturbing his project and he would be happier if his
suborned media outlets have unfettered access to the public.

The country has every reason to be afraid as long as Moyo is allowed to
continue to strut his stuff of hate. Consider this statement in his article
last week: “Any attempt to push matters further beyond the confines of the
GPA is very dangerous and will raise national security issues which will
have to take precedence over politics as happened after the March 29 2008
elections in the run-up to the presidential run-off election.”

This is scary stuff, especially when a pliant military is dragged in. We
witnessed how Brigadier-General Douglas Nyikayaramba in yesterday’s Herald
invented a foreign threat to the country to justify bullying Tsvangirai and
military involvement in politics.

The pattern of deceit is predictable. Moyo is calling for the arrest of
political opponents. In October last year he called for the arrest of
Finance minister Tendai Biti who has asked for an audit of proceeds from
diamond sales.

“Instead of auditing the Zimbabwe Mining Development Corporation which the
US and European Union want to know for purposes of widening and entrenching
their illegal economic sanctions, relevant authorities should probe Biti in
the light of WikiLeaks revelations that he is the local linchpin of the
illegal sanctions and the law must take its course without fear or favour,”
Moyo was quoted as saying in the Sunday Mail.

The pattern has continued. He has of late been imploring Attorney-General
Johannes Tomana to investigate Tsvangirai and Timba. He wants them arrested.

Moyo has started to speak for the president as if the presidential spokesman
George Charamba has been airbrushed from the political scene. Has he also
become the official government spokesman? Media, Information and Publicity
minister Webster Shamu must advise on that one!

In fact, who does Moyo think he is? Certainly not the respected academic who
was a much sought after columnist in newspapers who spurred debate on
critical national issues. He has sunk to an embarrassing nadir in which he
seems to believe that every reader of his diatribes is too thick to see
through his subterfuge.

Moyo’s project of hate and deceit must be rejected. All efforts to
reintegrate Zimbabwe into the international community will fail as long as
hate-mongering and repression are actively promoted as government policy.