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NEDPP not given a chance

FinGaz

Charles Rukuni Bulawayo Bureau Chief

THE government's new economic recovery programme, the National Economic
Development Priority Programme (NEDPP), was stillborn.

No one has bothered to explain why. It was not just given a chance. Period.
Most local newspapers condemned it simply because previous programmes had
failed.
Yet, as of last week, most, if not all, journalists had not even seen the
document that sets out what the programme is about.
The only information they had was what Economic Development Minister Rugare
Gumbo unveiled on April 19.
United States ambassador to Zimbabwe Christopher Dell summed it up all.
"I have carefully read the government's statements for evidence that there
will be policy shifts that might address the fundamental problems in the
economy here - shifts that would restore domestic and international faith in
the Zimbabwean economy and lead to renewed investment and a cycle of
recovery.
"So far, I see structure but no real debate. I see form but no substance. I
see committees, but no commitment to change policies that have shown they do
not work," Dell said in a speech at the National University of Science and
Technology in Bulawayo that was widely covered by both the local and
international press.
"One can't help but recall the series of economic plans announced
periodically since the country's economic crisis got underway at the
beginning of this decade," he added.
"We have the MERP- Millennium Economic Recovery Plan; the NERP - New
Economic Recovery Plan; a Ten-Point Plan; a NERP2; A TNF- Tripartite
Negotiating Forum; and now a NERC (National Economic Recovery Council).
"All announced with great fanfare; unfortunately, none yielding effective
policy to arrest economic decline. We certainly hope the NEDPP enjoys a
different and happier fate, but historical experience suggests some cause
for healthy scepticism."
Dell's views seemed to be shared by many.
The new programme was received with a lot of scepticism. Perhaps rightly so,
because how could the planners hope to raise US$2.5 billion in 90 days when
they had failed to do so under any of the previous programmes?
Even in 2004 when central bank governor Gideon Gono had his best year,
inflows only amounted to US$1.7 billion for the whole year.
NEDPP, therefore, could not succeed where others had failed, especially when
the country was under the same regime that had failed to deliver, so the
reasoning went.
Insiders say things are different this time. The profile of the new
programme has been elevated a notch up, they say.
The National Economic Recovery Council, which will drive the programme, is
chaired by Vice-President Joice Mujuru while technical committees are
chaired by the Secretary to the President and Cabinet, Misheck Sibanda.
Key players are all involved. Presidents of the industrial and commercial
bodies are in. Chiefs of the security services - the police, army, airforce,
central intelligence and the prison service - are also involved. So is the
entire cabinet.
The presence of the soldiers in the turnaround programme has resulted in
accusations of militarising the programme.
Some reports have even gone as far as saying that the army had taken over
the running of the central bank and the revenue authority.
With less than 24 months to the next presidential election, this makes good
reading. It makes it easier to argue that the ruling ZANU PF is already
gearing itself for the poll and is using the army to cow the electorate.
Zimbabwe National Chamber of Commerce president Luxon Zembe, one of those
heavily involved in the programme, says while the heads of security services
are involved in the turnaround programme, they are not running the show.
"We (the stakeholders: that is, business and the public sector) have simply
raised the profile of the turnaround programme from institutional to
national level," Zembe said.
The turnaround was initially driven by the central bank, but this has been
elevated to the Office of the President.
"People might see things differently, but they have to realise that we are
in a sinking ship. The priority is to rescue the ship or save the lives of
the people on board. It's no use pointing fingers," Zembe said.
He said Gono was still running the central bank with the help of his
advisory board, contrary to reports that the board had been dissolved.
This was confirmed by another board member, Eric Bloch, who chairs the
Monetary Policy Impact Assessment and Review Committee.
He said the board had not been meeting often but technical committees were
still meeting regularly.
Zembe said there were three key elements of the turnaround programme -
security, stability and productivity.
Security agencies had been brought in to provide security and to stop
vandalism on farms. They were also there to provide security and stability
for investors.
He said he was confident the turnaround programme would succeed this time
because it was now being driven from the highest level.
"Look at Malaysia or Uganda or even Pakistan or Singapore. The turnaround
programmes in these countries succeeded because they were driven at the
highest level," Zembe said.
Asked whether this was not just another fluke, Zembe said: "If there was no
seriousness and commitment, we would be the first to pull out. This time
there will be less talk and more action. Just watch out for the results."
Deputy Economic Development Minister Samuel Undenge echoed Zembe's
sentiments.
"This time, the results will speak for themselves," he said.
But after a six-year battering, during which the economy shrank by 40
percent, it will take more than promises to convince the average Zimbabwean
that the economy can indeed be turned around, especially with inflation
continuing to soar.
Economic commentator Tony Hawkins, in a paper he presented at the University
of Pretoria this month, said: "Serious economists know full well that
Zimbabwe will not - cannot - recover on its own. Economic recovery depends
on political change either within the country itself or on the part of those
in the West who will determine if, when and how much economic aid will be
forthcoming."
But he also admitted that "eight years into economic decline that has cut
GDP (gross domestic product) by 40 percent and halved income per head,
Zimbabwe is still standing.
"The oft-predicted collapse, implosion, meltdown has yet to happen,
highlighting the yawning chasm that separates economic decline and political
change in Africa".
Those involved in the programme are convinced that things will work this
time.
Policy shifts are there but people are writing them off as rhetoric. But
this time, the focus is on agriculture because it drives at least 60 percent
of the economy.
"The new thrust is that whoever is on the farm must produce. If they can't
produce, they must get out," Zembe said.
While President Robert Mugabe's regime has lost a lot of credibility, it is
believed that previous programmes have failed largely because of lack of
political will.
The government has often backtracked when it felt it would lose popularity
because some of the recovery measures were beginning to hurt the ordinary
folk.
This time, things appear to be different.
President Mugabe has said he wants to retire in 2008. There is nothing he
would love more than to leave when the country is back on its wheels.
Besides, any recovery would be a tremendous boost for his currently
preferred successor Mujuru, who heads the programme.


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Politicians risky for banks: RBZ

FinGaz

Rangarirai Mberi Senior Business Reporter
Central bank wants 'exclusive' clients, their business interests disclosed

THE Reserve Bank of Zimbabwe (RBZ) has issued new guidelines against money
laundering that could force more disclosure of the business interests and
identities of banks' "exclusive" clients.
The central bank this week released the "Anti-Money Laundering Guideline",
aimed at stemming what the RBZ says is the increased threat of money
laundering and warning banks against the risk of signing on as clients what
it describes as "politically exposed persons".
"Business relationships with individuals holding important positions and
with persons or companies clearly related to them may expose a bank or cash
dealer to significant reputational and/or legal risks," the bank said.
"Such politically exposed persons (PEP) are individuals who are or have been
entrusted with prominent public functions, including heads of state or of
government, senior politicians, senior government, judiciary or military
officials, senior executives of publicly owned corporations and important
political party officials.
"The possibility exists that such persons may abuse their public powers for
their own illicit enrichment through the receipt of bribes, embezzlement,
etc," it added.
According to the guidelines, banks must seek and make available more
personal details of their high-profile clients, including how they make
their money, and must also keep records of accounts and all transaction
records for at least 10 years after closure or completion.
"Banks and cash dealers should gather sufficient information from a new
customer, and check publicly available information, in order to establish
whether or not the customer is PEP. Banks and cash dealers should
investigate the source of funds before accepting PEP," the RBZ said.
Banks must establish the source of wealth, "including the economic activity
that creates their wealth" of the PEP, says the central bank.
The guidelines urge closer scrutiny of "unusual features", such as large
transactions, demands for secrecy, and regular transactions involving sums
just below a typical reporting amount.
A banker said yesterday that the guidelines are largely in line with
international trends, but could force banks to release to regulators
previously confidential information on the identity and business activities
of their clients, especially those in the top-end bracket.
A fine of $5 billion will be slapped on a bank for failure to report a case
of money laundering, while breaching rules on customer identification will
attract fines of at least $1 billion.


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The political face of inflation

FinGaz

Rangarirai Mberi Senior Business Reporter
Official silence as Zimbabwe enters four-digit territory
IN Zimbabwe, it is usually a good idea - just so people know where you
stand - to make sure that, each time you make some sort of public
announcement, you strategically place President Robert Mugabe's portrait
where everybody can see it.

But maybe someone should whisper to Moffat Nyoni, director of the Central
Statistical Office (CSO), that in his case, it might not be such a good
idea.
Take last week, for instance.
Sticking to tradition, the CSO had the President's large portrait looming
large over Nyoni as - in his usual deadpan manner - he ushered Zimbabwe into
a dark age of four-digit inflation.
The CSO boardroom is bare; so the only thing you are looking at is Nyoni
himself - and that large portrait peering from behind him.
Try hard as you may, you just can't help but look around the room wondering
whether everybody else in there is thinking what you are thinking.
After a brief lull, inflation turned higher in April last year.
Exactly a year later, inflation has hit a previously unthinkable
1 042.9 percent - the world's highest.
This has been despite a medley of strict monetary policy measures, and it
has shored up the view that the battle against inflation is now less a job
for the central bank than it is for Zimbabwe's political leadership.
With the momentum that inflation has now built up, many see salvation now
emerging only from a political situation - which would spare a blameless
Nyoni the monthly ignominy of announcing always-higher figures, always
against the background of the portrait.
"Unfortunately, things are going to get worse until the government realises,
not just in word but in deed, that a turnaround programme can only succeed
with pragmatic policies that recognise and respect property rights,
fundamental economic principles and political cooperation with the
international community," economist John Robertson said.
The head of a Zimbabwe Stock Exchange-listed company told The Financial
Gazette last week of how executives of a Johannesburg Stock Exchange-listed
South African institution ready to make a significant investment into his
firm have been asking him about what direction he believes the country's
politics could take.
Namibia this week announced its inflation at 4.4 percent.
Earlier this month, Zambia's inflation dropped into single-digit figures for
the first time.
Zimbabwe's inflation stood at seven percent in 1980 - with the Zimdollar at
$1.50 on the United States greenback - rising to 17 percent in 1990 and 56
percent in 2000.
Staying on the current road will see Zimbabwe comparing with the likes of
1923 Germany, when the European country printed 100 trillion-mark bank notes
and 50 billion-mark postage stamps.
For printing the notes, one firm handed the Reichsbank an invoice for 33
marks.
In 1946, Hungary issued a 100 quintillion peng§ note as prices doubled every
15 hours.
So, many had expected the arrival of four-digit figures to be an occasion of
self-examination.
But there is little to suggest that change is coming.
There has been no official comment on the landmark April data, but state
media have over recent days provided insights into the possible thinking
within the government.
Don't panic, said The Sunday Mail: "Zimbabweans should not be alarmed by the
1 000 percent inflation rate announced on Friday as the economy is set to be
revived because of a combination of natural factors and government-initiated
policies unveiled in the past few weeks."
The paper says inflation will fall on a 1.8 million tonnes maize harvest,
the investment by Indian firm Global Steel Holdings Limited into Zisco, the
recent increase in producer prices and - this one shot down like a light
from heaven - higher salaries for civil servants "which will encourage
savings and investment".
ZTV had a better solution to the "economic challenges" on Monday night.
Reaching into the delusional, the state broadcaster said the economy would
recover with an upgrading of the Harare International Airport and the
Beitbridge border post.
While the state media scrape the bottom of the pot for solutions, analysts
say the latest inflation figures must - perhaps like Paul on the road to
Damascus - be the signal that finally converts the government into a
believer in the same reforms that have brought progress to the rest of the
region.
But critics hold out little hope for some miracle conversion just yet.
"I have carefully read the government's statements for evidence that there
will be policy shifts that might address the fundamental problems in the
economy here - shifts that would restore domestic and international faith in
the Zimbabwean economy, restore the government's credibility on economic
issues, and lead to renewed investment and a cycle of recovery.
"So far I see structure, but no real debate. I see form, but no reform. I
see committees, but no commitment to change policies that have shown they do
not work," says US ambassador Christopher Dell.


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Government lifts Trust Bank chairman's specification

FinGaz

Chris Muronzi Staff Reporter

THE GOVERNMENT has revoked the specification of Trust Bank Corporation
chairman Josephat Sachikonye, bringing to eight, the number of bank
directors whose specification has been lifted over the past month.

The government specified Sachikonye, who is also the managing director of
mining giant Rio Zimbabwe Limited, last November along with Trust's founding
directors William Nyemba, Chris Goromonzi, Phillip Dhliwayo and Nyevero
Hlupo.
Also specified were firms linked to the former bank executives.
The revocation of Sachikonye's specification was announced in the Government
Gazette.
"The Minister of Justice, Legal and Parliamentary Affairs, in terms of
section 6(2) of the Prevention of Corruption act (chapter 9:16), has revoked
the specification of Mr. Josphat Hatidikani Kevin Sachikonye, who was
declared as a specified person under General Notice 452 of 2005, published
in the government Gazette Extra Ordinary of the 18th November, 2005.
Last week government revoked the specification order on Time Bank, Time Bank
Investments (TIBC) and on CEO Christopher Tande, managing director Kenneth
Chikonzo and former head of risk, treasury and finance Killian Kapaso.
Also no longer specified are Watermount Estates, Assetfin, Unitime
Investments, Total Insurance, Shoppex and Release Power Investments, the
companies that had been at the centre of a probe into whether the bank's
directors could have used them to defraud the bank of $440 billion in 2004.
The directors of Watermount, Kwaziso Bosha, Onias Gumbo and Emelda Mapanzure
are also no longer specified persons.
TIBC shareholder Web Beter Mashumba, who in December 2004 launched a
landmark application for the enforcement of the Administrative Justice Act
(AJA) seeking a reversal of the curatorship, has also had his specification
revoked. Mashumba had questioned the central bank's integrity in ordering
the closure of the bank when there was an earlier legal challenge against
RBZ by Time.
Mashumba said the curatorship was ordered on the basis of a $320 billion
loan to Watermount, criticising the action as contravening key sections of
the AJA as the RBZ had not given the bank adequate notice or a chance to
respond.
A number of business executives were specified for allegedly sabotaging the
country's economy.
Mutumwa Mawere, Julias Makoni and James Mushore, among others, are still
specified under the Prevention of Corruption Act.


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Pari Hospital runs out of coal

FinGaz

Kumbirai Mafunda Senior Business Reporter
Spectre of unsterilised kits looms at institution
A CRITICAL shortage of coal has hit the country's biggest public hospital,
Parirenyatwa, raising the worrying prospect of unsterilised equipment being
used on patients.

Authoritative sources at Parirenyatwa told The Financial Gazette this week
that the country's biggest referral hospital had run out of coal, which is
central to operations at the hospital.
Doctors and nurses disclosed that autoclaving machines, which are used in
the sterilisation process, were not working because of the coal shortage.
Of the hospitals' three boilers only one was reported to be functioning.
Ideally, staff said, two boilers must be working at any given time.
The hospital requires 7 tonnes of coal a day to heat up the boilers, which
then generate steam for use in sterilisation, kitchens and for the provision
of hot water for use in the hospital wards and at staff homes.
Thomas Zigora, the chief executive officer at Parirenyatwa yesterday
confirmed the coal shortage blaming it on the suppliers-Hwange Colliery
Company.
"We have a very serious shortage of coal," said Zigora. "We are having
intermittent supplies and this just exerts more pressure on workers," he
added.
The crisis is reportedly caused by Hwange's failure to cope with coal
demand, which increased after farmers began curing tobacco.
Early in the year Hwange experienced break downs of its haulage equipment,
aggravated in part by heavy rains, resulting in the coal supply shocks.
Although Zigora said the hospital had received 15 tonnes of coal on Tuesday,
the supplies will only last for two days as the boilers use up 7 tonnes of
coal a day.
Zimbabwe's health delivery system, once one of Africa's best, has of late
turned out to be one of the worst casualties of the country's worsening
economic crisis, which is characterised by hard currency shortages, drug
shortages and unprecedented levels of inflation officially pegged at 1042.9
percent.
Apart from coal shortages, Parirenyatwa together with other provincial
hospitals is plagued by a flight of skilled staff among them doctors, nurses
and pharmacists, at a time when the country is in the grip of a devastating
HIV/AIDS pandemic.


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Mine seizures spoil meeting

FinGaz

Staff Reporter

CAPTAINS of Zimbabwe's mining industry head for their annual general meeting
this week optimistic that the government, which has announced plans to
nationalise majority control in mining firms, will accede to calls for a
rational approach to empowerment.

Mining industry sources told The Financial Gazette this week that there
appeared to be cracks within President Robert Mugabe's Cabinet, with some
officials urging caution.
The government has proposed to take over 51 percent shareholding in existing
foreign-owned mines, with 25 percent of that equity being free carry.
The subject is expected to take centre stage at the Chamber of Mines' annual
general meeting, which kicks off in Victoria Falls today.
"There are influential people in government who want to benefit from a
chaotic empowerment programme but concerns on such a move have been raised
within Cabinet. Others fear that a land reform-style takeover could see the
government facing litigation from foreign companies, whose investments are
protected'" said a source.
The industry is hopeful the government will back down from its stated
position, which was reiterated by President Mugabe during Zimbabwe's
independence celebrations last month.
The chamber has extensively lobbied the government, highlighting the dangers
the policy poses to already battered investor confidence.
Apart from worsening Zimbabwe's investment climate, the chamber warned that
the proposed amendments to the Mines and Minerals Act would push the
struggling nation deeper into economic crisis, given that mining has
replaced agriculture as the largest foreign currency earner after the
government's disastrous land reform programme.
The land redistribution programme, which had a precipitous start without
adequate funding and planning, is now mired in controversy after farm
production plummeted, resulting in severe food shortages.
Mines and Minerals Development Minister Amos Midzi yesterday said
consultations were still in progress on the amendments to the country's
mining law.
"We are still consulting with the chamber. That is the position as of now.
Obviously we are doing that within the policy framework and I cannot say
anything apart from that," said Midzi.
Chamber officials have held several meetings with the government since March
in a bid to come up with a solution to the empowerment puzzle.
Mining firms say the takeover would slash jobs, freeze bank support and send
output lower.
Foreign-owned companies, including Zimbabwe Platinum Mines, Rio Tinto,
Metallon Gold Corporation, Halogen and Mwana Africa Plc, have been locked in
negotiations with the government in a bid to come up with an agreeable
empowerment regime.
Metallon, the country's largest gold producer, has confirmed industry
worries by announcing the suspension of planned projects at How Mine - the
largest of its five mines - as well as Redwing mine, citing concern by its
foreign bankers.
Rio has also put on hold expansion plans until the empowerment issue is
resolved.


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Govt loses interest in Paradza

FinGaz

Njabulo Ncube Chief Political Reporter

THE government has indicated it will be difficult to extradite fugitive
former judge Benjamin Paradza from New Zealand due to strained political
relations between Harare and Wellington, The Financial Gazette established
yesterday.

Paradza fled Zimbabwe in January, a few days before retired High Court Judge
Simpson Mutambanengwe, now a Supreme Court judge in Namibia, convicted him
of two counts of corruption.
Patrick Chinamasa, the Minister of Justice, Legal and Parliamentary Affairs
yesterday said Zimbabwe's longstanding dispute with countries such as the
United Kingdom - which turned down Paradza's asylum application - and New
Zealand made it difficult to press for the judge's extradition.
"I am not his (Paradza) keeper but there is no likelihood he could be
extradited to Zimbabwe because at the moment we have no relationship with
the UK and New Zealand," said Chinamasa.
The UK and New Zealand are among the Commonwealth states that have slapped
sanctions on the Zimbabwean government, citing a growing governance and
human rights deficit. The Zimbabwean government withdrew from the
Commonwealth three years ago under pressure from critics within the Club.
"We no longer have an interest in him. He (Paradza) knew that if he ran away
to these countries we would not be able to extradite him. We only seek
extradition where we have a political relationship. We have no political
connections in those countries where he is hiding," said Chinamasa.
According to the British Mail on Sunday newspaper, well-wishers had arranged
a 40 000 pound university fellowship fund to
enable Paradza to further his studies in the UK.
Paradza was convicted of corruptly attempting to influence two other judges
to release the passport of his safari business partner to travel overseas
for a deal that could have earned the judge US$60 000.
Although he was convicted of corruption, he has argued that he was a victim
of the government's attempts to turn the judiciary into "pliant servants" -
charges Chinamasa and other government officials have publicly dismissed.
Paradza was arrested in February 2003 in his chambers, a month after he had
made a court ruling ordering the police to release the former popularly
elected executive mayor of Harare, Elias Mudzuri and 21 others following
their arrest in Mabvuku at a ratepayers' meeting.


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GMB militarised

FinGaz


Kumbirai Mafunda Senior Business Reporter
Soldiers man depots countrywide
GOVERNMENT has deployed military personnel to Grain Marketing Board (GMB)
depots across the country to monitor grain deliveries, as multilateral
agencies voiced scepticism over official projections that the country
produced 1.8 million tonnes of the staple maize during the last agricultural
season.

Army and government sources told The Financial Gazette this week that army
personnel had been deployed to the state-run GMB depots, where they have
introduced a parallel recording of the grain deliveries to that of the GMB
and Agricultural Research and Extension Services (AREX) officers.
Army insiders said some of their counterparts who are engaged in the
countrywide exercise are accommodated at police stations which are close to
the GMB depots. They said the army is maintaining its own inventory.
"Our personnel are stationed at GMB depots and have their own log books to
check on the delivery of grain this year," said the army sources.
The insiders also disclosed that the army was taking note of allocations of
agricultural inputs such as seed and fertiliser at all GMB depots following
reports of abuse and unfair distribution of inputs in the last cropping
season. The GMB is currently dispensing inputs to farmers intending to grow
wheat this winter under an ambitious exercise to plant 110 hectares and
reduce wheat imports.
GMB acting chief executive officer Samuel Muvhuti, himself a retired army
colonel, yesterday sought to dismiss reports of the involvement of the army
in the operations of the GMB.
"We (GMB) are responsible for the movement of grain," said Muvhuti. "The
Zimbabwe National Army (ZNA) is also busy doing other functions . . . we
enlist the services of transporters," he added.
Late last year, the army launched a command agriculture programme dubbed
Operation Maguta in a desperate effort to boost agricultural production and
avert massive food shortages which have plagued the country since 2000 when
veterans of the liberation war and gangs loyal to the ruling ZANU PF seized
productive farmland from white commercial farmers.
The government-initiated programme, which to all intents and purposes places
all agricultural activities under the military involves the cooperation of
government agencies such as the Agricultural Rural and Development Authority
(ARDA) and AREX which identify underutilised land where soldiers then
spearhead maize production.
Under the initiative, army officers are tilling fertile agricultural land to
boost maize output following poor harvests over the past six years.
Army spokesperson Simon Tsatsa yesterday said: "According to its
constitutional obligations, the ZNA is mandated to render military
assistance to the civil ministries. These operations are undertaken to
assist government ministries in implementing projects that are designed to
benefit the community".
"As such the GMB, being a public concern, has benefited variously from the
ZNA in implementing its outreach projects such as grain and inputs
distribution. These operations are not done on a permanent basis but they
are only
undertaken on request and on need basis," he added.
Zimbabwe, once the bread basket of southern Africa, has been forced to rely
on food handouts from the international donor community owing to poor
harvests mainly caused by the chaotic land grab exercise and a few cycles of
drought.
Multilateral food agencies have expressed doubts over Agriculture Minister
Joseph Made's claims of a bumper harvest this season. Made, who has
previously inflated the country's grain yields, told a parliamentary
portfolio committee on agriculture that Zimbabwe would harvest 1.8 million
tonnes from the just ended farming season.
Crop forecasts by the United States Department of Agriculture (USDA) and the
Famine Early Warning System (FEWSNET) have jointly projected Zimbabwe's crop
harvest at between 800 000 and 900 000 tonnes, about half the annual
national requirements. This means the country will once again allocate a
significant portion of its limited foreign currency to grain imports this
year.
The Zimbabwe Grain Producers' Association (ZGPA) has forecast a yield of
about 700 000 tonnes, citing the "untimely availability of inputs to
farmers."
Made's puzzling disclosures also come at a time when the Zimbabwe
Vulnerability Assessment Committee (ZIMVAC) is yet to carry out its annual
crop assessment that involves the participation of multilateral agencies.
The multi-stakeholder body, which comprises the World Food Programme (WFP),
Southern African Development Community institutions, non-governmental
organisations (NGOs), FEWSNET and the government had announced that the
survey would get underway this month.
Insiders within ZIMVAC disclosed this week that the crop inspection is now
at risk as government is yet to endorse the survey.
"Let's talk at the end of May when we get the approval from the government,"
said an insider who requested anonymity.
Government is reportedly on edge over the independent crop assessment since
it involves some multilateral organisations, which it barred from inspecting
the country's crop harvest.
The government last month blocked the United Nations Food and Agriculture
Organisation (FAO) from scrutinising the country's harvest.
The FAO-backed survey could have been used as a barometer for Harare's food
aid requirements in the 2006/07 marketing year in which the country is
projected to register another disappointing harvest despite receiving above
average rains.


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Extraordinary five days on the financial markets

FinGaz

Rangarirai Mberi Senior Business Reporter

THE release of record high inflation figures on Friday was perhaps the most
fitting cap to an extraordinary five days on the financial markets last
week.

It was a week that served up the latest show of the escalating volatility of
central bank policy, the "irrational exuberance" of the stock market, and
also an example of how fuzzy things can get in the absence of key
statistics.
On Tuesday, the Reserve Bank of Zimbabwe (RBZ) announced the end of 91-day
paper, informing the market that it would now only issue paper with tenure
from one year to three years.
A 365-day bill was issued, winning notable support with $1.5 trillion being
allotted, as the market appeared to have quickly warmed to the CPI-linked
paper.
In response, the stock market raced 25.69 percent on Wednesday, beating
previous record jumps on January 27 and October 21's 24.8 percent rise to
stand just below the 48 851 608.05 point all time high.
Fidelity doubled the wealth for its shareholders in one day, rising 101
percent and stuffing it to the many analysts that have always ignored the
share.
Also Wednesday, the Central Statistical Office (CSO) had scheduled the
release of April inflation numbers. Less than an hour before the crucial
data was due, the Ministry of Information announced the statement had been
"postponed indefinitely".
The news on the delay sent the market rumour mill into a frenzy. Perhaps the
figure was too frightening and government wanted a look at it "to see if
anything could be done" before its release, one version said.
On Thursday, a reader called The Financial Gazette and asked if it was true
that government had decreed that inflation numbers would no longer be made
public. As the market continued to fret over the new inflation data on
Thursday, the RBZ stumped dealers by withdrawing the new 365 Treasury Bills,
floating 91-day paper at the morning tender. The central bank proceeded to
reject all bids, which ranged between 500 percent and 650 percent. The RBZ
returned to the market at midday with another tender, raising $203 billion
at an average yield of 350.2 percent. The last tender, held at 2 pm,
allotted all $30 billion worth of bids, at an average rate of 350 percent.
The ZSE closed Thursday down nearly five percent as investors wondered what
was what.
On Friday, the week ended with the CSO finally confirming inflation above 1
000 percent for the first time. Shares raced 4.7 percent forward on the day.
"If I could, I would have parked it all somewhere and gone on holiday and
come back when it makes sense," one fund manager told The Financial Gazette.
But like most market players, he had to stay put and take panic calls from
confused investors.


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125 000% pay gap between workers, executives

FinGaz

Rangarirai Mberi Senior Business Reporter

THE percentage gap in salaries between the least and highest paid workers is
a massive 125 000 percent, while more executives are taking more and better
benefits than non-managerial staff, according to a new human resources
research.

The Human Resources Management Practices Report 2006, prepared by respected
consultants Organisational Excellence, also reveals that many companies are
reviewing salaries monthly or quarterly, with some even paying their workers
twice a month "to hedge against the rising costs of living adjustments".
The consultants surveyed 54 organisations, 13 percent of which are listed.
The minimum monthly salary that a non-managerial employee earned last year
was $2 million, compared to a maximum of $250 million for an executive,
straining relations between staff and managers, Organisational Excellence
says in the country's first ever such survey.
"This indicates a widening gap between what senior employees earn compared
to what lower level staff earn. There is need for organisations to maintain
reasonable salary differentials between different level employees. The huge
gap leads to an unstable industrial relations climate especially where
employees perceive management to be extravagant in its spending. In a
hyperinflationary situation like ours, salary differentials between grades
should range from 40 percent to 120 percent."
The survey found that over 28 percent had no job evaluation systems, saying
that this explains "the chaotic nature of salary differentials in some
organisations". Only 36 percent had a remuneration policy.
"Over 80 percent of these organisations indicated that they have one pay
structure for both managerial and non-managerial staff. This is surprising
considering that most managerial staff salaries are NEC driven," the survey
says.
And while the survey shows how executives are taking much of the cream off
the top, it also shows that executives are enjoying a lot more benefits that
non-managerial staff, with benefits in the form of fully paid holidays,
lunch, cell phone allowances, housing loans, security guards, car loans and
school fees.
The survey however refreshingly shows that companies are moving towards 100
percent medical aid cover, with 23 percent giving 100 percent fully paid
medical aid cover to all staff. Some 13 percent said the 100 percent cover
only benefits executives.
The survey finds that most executives are choosing to keep their companies'
salaries structures secret: "The general trend is that employers do not want
to disclose the pay structure to staff. Best practice however calls on
organisations to make the whole pay structure known to staff. This helps
remove feelings of inequity in the remunerations structure. Disclosing the
pay structure means listing the minimum, midpoint and maximum salary for
each grade. It is not about disclosing individual salaries".
Manufacturing had the highest staff turnover rate at 50 percent, followed by
service at 34 percent. The survey also showed that the insurance industry
led in staff welfare - the amount a company spends in assisting a worker in
welfare issues - spending $239.2 million per employee. NGOs and retailers
spent the least on welfare.


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Government must act or face explosion

FinGaz

National Agenda with Bornwell Chakaodza

Unemployment at 80 percent. Seventy percent living below the poverty line.
Ninety percent bearing the brunt of the ever-rising prices of commodities.

Stress, despair, fear, weariness, desperation and hunger written all over
people's faces. And now inflation crossing the long-dreaded 1 000 percent
threshold.
What will it take next for the ruling ZANU PF party to be jolted into real
action?
No amount of lies and false propaganda from the state-owned media can
disguise the fact that the economy has, to all intents and purposes,
crumbled.
The above sobering statistics speak for themselves. And they will not go
away until and unless we give the correct interpretation of the causes of
our crisis and get the fundamentals right. Correct diagnosis will result in
the right cure.
The correct interpretation is that ours is a ZANU PF-induced crisis. Things
could have been done differently and ZANU PF need not have massacred the
country in the process.
We have said it before and we will say it again: Zimbabweans of all
colours - the initial intransigence of the white commercial farmers
notwithstanding - were all agreed on the need for a thorough-going land
reform programme.
But to have carried out the programme in a chaotic manner and in the context
of a realisation that the people of Zimbabwe were withdrawing their support
from a party that had ruled the country for 20 years is what was totally
unacceptable.
We must stop blaming outside forces. Zimbabwe as a country is not under
sanctions. These are the lies of the times we live in. It is the political
leaders who are under targeted sanctions.
The truth of the matter is that the behaviour and attitude of the Western
countries is not the cause of our economic collapse. Rather, it is a symptom
of what has gone basically wrong with our political system.
And the sooner the current Zimbabwean authorities grasp this simple fact,
the sooner will the country embark on a holistic solution to our crisis.
Insisting on continuing to bury their heads in the sand and repeating time
and time again the same mantras of sanctions and a country under attack will
not get us anywhere.
It is not only unpatriotic and servile but criminal for anyone, including
the government-owned media, to tell Zimbabweans not to be alarmed by the 1
000 percent inflation rate when their pockets are being assaulted by that
monster on a daily basis.
I am all for sunshine stories, but not when all the signs indicate that the
economic situation is going to get worse.
Just because a National Economic Development Priority Programme (NEDPP) was
recently unveiled on paper does not mean that on the ground things are going
to significantly change.
We have travelled that road before and nothing came out of it. Since 1980 a
paper factory has been busy producing document after document.
Neither can we believe the projected maize harvest figures this season that
the Agriculture Minister, Joseph Made, is banding about.
This is the same man whose production predictions of grain from some
highflying aircraft four years ago was way off the mark.
Perhaps his assessment once again has been made from the same aircraft -
above the cloud cuckoo land in which he lives.
But more dangerous is the belief that inflation will be reversed as a result
of the crop harvest this season. Such economic illiteracy on the part of the
official media and bogus "experts" is incredible and astounding.
I am sure the Reserve Bank governor, Gideon Gono, will be first to admit
that inflation is a complex phenomenon which has to be tamed holistically
and not piecemeal.
I honestly believe that Zimbabwe's actual inflation might be far above
1 000 percent, given the fact that strong emphasis is being put on food,
fuel, electricity and the acute shortage of foreign currency to the
exclusion of other equally important inflation drivers.
What about education costs in the form of school fees, prices of uniforms
etc? These have skyrocked to unimaginable proportions, while health and
transport costs are some of the fastest growing elements in the consumer
price index.
Due to the now four-digit inflation, the recent salary increases have
already become very low, are buying less and less and are increasingly
insufficient to satisfy the basic needs of a family.
Not to mention the printing of money to make up for the increases, in the
process fuelling inflation further and further.
One only has to enter a supermarket or any store to see the cost of a basket
of goods. For example, a million Zimdollars can only buy one or two items,
such as a 10kg bag of maize-meal and 1kg chicken.
It is difficult to imagine how pensioners, the poor and everybody else
except the looters is surviving.
Apart from remittances from relatives abroad, more and more people are
trying to survive on the informal sector of the economy, which, in the wake
of the government's "Operation Murambatsvina" is not providing much for a
decent living.
Even for the few in the shrinking formal sector, real wages have failed to
keep pace with the cost of living, not only for low-income families but also
for the endangered middle-class, if at all there is still a middle-class to
talk about.
ZANU PF policies have seen to it that there is no longer any middle-class to
talk about in Zimbabwe.
There is enormous suffering in this country which the government is not
doing much to alleviate.
That Economic Development Minister Rugare Gumbo can say in a Face the Nation
television programme that NEDPP is the answer to our crisis but in the same
breath say fighting inflation is the sole responsibility of the Reserve Bank
governor, not the government, is indicative of our government's failure to
understand what business is about, what drives a healthy economy, what
markets mean and what drives investment.
Politics is at the heart of our crisis. Of course, productivity is also key
to rebuilding Zimbabwe. Ours is an agro-based economy but resuscitation of
industry is very crucial in any efforts to turn the country round.
It would be na´ve in the extreme for anyone in government to think that
things can be turned around by solely looking to the East for support and
signing memorandums of understanding with equally poverty-stricken African
countries.
The official media has always been awash with these memorandums of
understanding - between Zimbabwe and Equatorial Guinea, between Zimbabwe and
Malawi, between Zimbabwe and Uganda: these are the latest in a long list of
African countries.
But to date, there has been really very little to show for it.
This is an era of globalisation and investment will naturally go to the
best.
Confidence in our political and economic system on the part of the
international community as a whole is critical. Investment is dead in the
water precisely because of this lack of confidence in our system.
The tourism sector, once one of Zimbabwe's milk cows, is now a pale shadow
of its former self. Negative publicity is merely a symptom, not the
underlying cause of the sector's near-collapse.
We need to understand one simple point: that the fight against inflation
cannot be won - not really won - by a mix of economic imperatives alone.
Political normalisation and a visionary Marshall-type of plan to rebuild a
bankrupt Zimbabwe is what is needed at this point in time.
President Robert Mugabe has taken us this far and future generations might
look back on this turbulent period with gratitude and appreciation. But for
the country to move on, a new leader and new democratic institutions are
what is now needed.
President Mugabe cannot be the man to make this transition. I think, and so
do most Zimbabweans, that the President has played his part. For good or
ill, he has run his race and it is time to pass on the torch.
As a Catholic, I am sure God will give President Mugabe the courage and the
wisdom to do what is right - in the interest of Zimbabwe.
We have long reached the point where Zimbabweans are no longer willing to
put up with the existing authorities. They are fed up and extremely angry.
But they are a patient and docile lot.
The people here are bearing their degradation and suffering in silence -
weighed down by the daily struggles of existence in this extremely tough
environment.
But there are decided limits even for a timid and peace-loving people beyond
which they cannot go - unless something is done to ameliorate their terrible
conditions.
The last thing that every Zimbabwean wants to see is this country slide into
anarchy. That is what will happen if the people decide to fight for change
in the streets rather than at the polling booths.
The plain truth is that the polling booths have not yielded any positive
results. The hope and expectation of all Zimbabweans, therefore, is that the
evidence of endless economic hardships as a result of the inflation, which
is like a bulldozer going one way, will induce or jolt President Mugabe and
ZANU PF to act before the explosion.


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Are destitutes not entitled

FinGaz

Personal Glimpses with Mavis Makuni

A YEAR after the tumultuous banishment of hundreds of thousands of city
dwellers to the rural areas after the demolition of their abodes and market
stalls, under the controversial Operation Murambatsvina,

it should be time for the authorities to step back and assess whether this
is the best way to control population growth in the urban centres.
When police squads suddenly stormed the streets of Harare last year to
launch the widely condemned exercise, the official justification for the
heavy-handed action was to restore Harare's "Sunshine City" status by
clearing the streets of both debris and the thousands of illegal vendors
accused of causing decay in the central business district. Another rational
for the blitz was the imperative need to rid the city centre of undesirable
elements who were said to be hoarding essential commodities and conducting
illegal foreign currency dealings. Their activities were said to be fuelling
shortages of basic commodities and foreign currency.
But of course, as is well known, the exercise soon became a full-blown
demolition spree in which hundreds of thousands of structures were bulldozed
by army and police squads not just in Harare but in urban centres and rural
areas nationwide. After sparking a hue and cry at home and internationally,
Murambatsvina was hurriedly transformed into Garikai/Hlalani Kuhle under
which the government pledged to provide decent accommodation for its people.
But where are the government's people and after a year of reconstruction,
why is it still necessary to conduct crackdowns?
Most laymen and women like me would conclude that any vulnerable groups such
as the destitute, the homeless and the sick should be at the top of the list
of any programme that sought to reduce human suffering and restore the
dignity of those affected. Regrettably, this expectation appears to be at
total variance with official policy, which seems to be that the destitute
and helpless are not entitled to state protection and assistance and should
fend for themselves.
This, certainly, is the impression given by the launch of the latest
clean-up exercise, Operation Round-Up in Harare last week. The daily papers
reported last weekend that more than 10 000 people, described as squatters,
vagrants, street kids, touts and other 'disorderly elements, were rounded up
by the police in the latest raid and would soon be relocated to their rural
homes, according to Assistant Commissioner Munyaradzi Musariri.
Assistant Commissioner Musariri claimed police had established that street
kids and vagrants were responsible for crimes such as rape, theft and
robbery and would not rest until sanity prevailed in the streets. Most of
those caught would be taken to their rural homes, he said. But the question
to ask is how many times have such raids been conducted in the past without
solving the problem? The answer is that the rounding up of street kids and
homeless people has been a permanent beat on the police duty roster for
decades without making an iota of a difference. If anything, the problem has
steadily escalated with the result that there are more children and other
destitute people on the streets who have no choice but to engage in an
endless game of hide and seek with the law enforcers.
This is because the authorities only seem to be concerned about getting
these destitute Zimbabweans "out of sight" without addressing or at least
acknowledging the social and economic ills that have given rise to such
destitution. If they did, they would realise that a child who lives on the
streets because he or she is an AIDS orphan does not have a rural home to go
to. The same goes for widows, retrenchees, the sick and the displaced who
lost their abodes under Murambatsvina after living in the city all their
lives. The authorities know that by forcing these vulnerable groups to go to
"their rural homes" they are evading issues and passing the buck - to no
one.
The destitute people being rounded up under these latest police raids should
be given priority under Garikai/Hlalani Kuhle. What a wonderful and
conciliatory gesture it would have been to mark the first anniversary of
Operation Murambatsvina by allocating shelter to the victims of Operation
Round-Up. I came face to face with a most heart-rending sight on the day
this latest purge got underway. Slumped on the side of the pavement as I
hurried along was a young boy of between 12 and 14 years of age. His body
and the smithereens of fabric that represented his clothes were as black as
soot. He was deathly still and it was difficult to tell whether he was alive
or whether he had succumbed after constant exposure to the elements. I asked
myself whether any one would choose to live like that if he had a choice.
This is a question that the authorities should ask themselves each time they
subject homeless people to the indignity of rounding them up like animals
and dumping them in the middle of no where. The problem of urban population
growth is not peculiar to Zimbabwe but is an acknowledged global phenomenon.
A report presented to the United Nations Economic and Social Council by UN
Secretary General Kofi Annan last year predicted that by next year, half of
the world's population will live in cities. This phenomenon is expected to
have the greatest impact in the developing world, where the UN projects that
by the year 2017 the number of people living in the rural and urban areas
will be equal.
This obviously calls for forward planning by national governments which
should embark on projects to improve and expand urban infrastructure to cope
with increased demand. This also calls for the improvement of living
standards in the rural areas. It can be argued that the government is trying
to make living in the rural areas more attractive through the Ministry of
Rural Housing and Social Amenities headed by Emmerson Mnanga-gwa. However,
this ministry was only set up last year and it is still trying to find its
feet. Before its work gets off the ground, it is unrealistic to banish
homeless urban dwellers to these areas.
Moreover, forced migration of urban populations to the rural areas is not
the answer and has never been resorted to anywhere in the world except in
Cambodia. The Khmer Rouge evacuated cities and towns in Cambodia in the mid
1970s and sent the country's entire population out into the countryside to
clear jungles. More than one million people were either executed or
succumbed to the enforced hardships during this madness. This was a clear
case of genocide by a brutal regime. It is hardly a precedent to be emulated
when more humane approaches are possible and desirable.


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It's Chombo's fault

FinGaz

Comment

IT is not difficult to understand why hard-pressed rate-payers in Harare are
disillusioned by the ZANU PF charlatans imposed on the City of Harare
following Local Government Minister Ignatius Chombo's ruinous political
interference.

Of course the commissioners were ostensibly brought in to turn around the
operations of the city but in the court of public opinion they are a
deadweight, which has instead numbed the municipality. Thus, service
delivery in Harare is going to hell in a handcart!
The commissioners, who are hardly free of political strings and partisan
obligations, continue to stick the middle finger right in the face of the
city's residents. Last week, the entire commission snubbed the Parliamentary
Portfolio Committee on Local Government - hardly the actions of those who do
not have anything to hide. This explains why this was widely seen as an
attempt to evade scrutiny.
In any civilised and democratic society not known for ever-shrinking public
accountability and transparency, this would constitute the most
irresponsible and inexcusable action by public officers and they would not
get away with it. Why? Because it would be a violation of the social and
political contracts between people and public officers.
The portfolio committee had called for a hearing to enable it to compile a
report on the goings-on at the city council which would later be tabled in
the House of Assembly. But only commission chairperson Sekesai Makwavarara
and Prisca Mupfumira appeared before the portfolio committee.
This prompted one panel member to say: ". . . They do not take all this
seriously. In any case they are all busy running their businesses some of
which feed off council, so they cannot find time".
The MP could not have said it any better. There could never be more telling
evidence that the commissioners do not care two hoots about what becomes of
the decaying capital city. They are there for two reasons and two reasons
only: for self-aggrandisement and to push the not-so-hidden agenda of the
ruling party whose obsession is to assert its political influence in Harare.
And they are proud of it. No shame, no remorse.
Coming in the wake of startling revelations of rampant corruption,
deep-seated political patronage and abuse of council assets by commissioners
and senior employees, the arrogance of the Chombo-appointed commissioners
betrays disdain and profound contempt for the residents of the city. And to
think that Chombo went to the ends of the earth to depose Harare's popularly
elected mayor and councillors and replacing them with the hand-picked
politically-correct commissioners!
What is increasingly clear to the residents of the sunshine
city-turned-sewage farm is that in the face of the government-ordered chaos
at Town House, expecting a change of fortunes in the operations of the city
under the commission would be hopefulness bereft of realism. The residents
now know that the pledges made by the Makwavarara-led commission to turn
around the city will not take that giant leap into reality any time sooner
than the end of the third millennium . The situation is nothing short of
dire.
Indeed, as we have warned in our previous editorial comments, Chombo's
meddling, which raised eyebrows and coughs of disapproval from a wide
cross-section of the Zimbabwean community, will make itself felt in the city
for years to come because it has drastic long-term consequences that are not
borne by the government but by the residents.
Although he behaves as if this is nothing to lose sleep over, the truth is
that even in his own egotistical imagination, the omnipotent Chombo, who has
been throwing his political weight hither and thither should admit as much.
Never before has the situation in the city been sorrier.
The long-expected new generation of public services under the incompetent
commission running the affairs of the capital city remains a pipe-dream. If
anything the situation continues to deteriorate at an alarming rate. Harare
has degenerated into a city of rivers of raw sewage, mountains of
uncollected garbage, unlit streets, collapsing infrastructure among others.
Resultantly, the residents have plunged the depths of despair.
But then again, politics has no soul which is why the politicians (read
commissioners) do not give a damn. They are a different kind of public
officers. They were not elected into office and they owe their allegiance to
no one but Chombo who imposed them on the city of Harare. And they can only
be accountable to ZANU PF whose parochial interests Chombo is pursuing with
a passion.


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Corruption compromising corporate governance

FinGaz

Economic Viewpoint with Allan Choruma

INSTEAD of being in the forefront of promoting high standards of ethical
corporate behaviour, it is now common in Zimbabwe to come across cases in
the media of company directors being prosecuted on corruption and similar
charges.

Major corporate collapses and scandals in the country have also been
attributed to failure by directors to foster business ethics and corporate
responsibility.
Effects of corporate corruption
Corruption by some deviant directors and senior management not only harms
the reputation and business fortunes of companies they lead, but has
macroeconomic and other external negative consequences.
Corporate corruption has negative impact on investor confidence and harms
the integrity of our financial and capital markets.
Corporate corruption also affects our national reputation and standing in
the international community.
It creates an image of a country where it is unsafe for external investors,
international financial institutions, donor agencies and governments to
invest.
The consequences of corporate crime on the entire economy cannot, therefore,
be overemphasised.
The level of corporate corruption in Zimbabwe is alarming and demonstrates a
business community that is tearing apart the fabric of good corporate
governance.
In Zimbabwe, we can no longer confidently claim that we have a tradition of
business integrity, honesty and fair dealing with shareholders, customers,
associates, regulators and other stakeholders as we used to do in the past.
Our corporate governance system has been eroded by some errant company
directors and executives who violate laws and regulations with impunity and
display the lowest standards of ethical behaviour.
Ethics
Corporate governance goes beyond compliance with laws, codes and best
corporate practices.
As Mervyn King SC, chairman of the King II Committee and a renowned
corporate governance practitioner in South Africa, once stated: corporate
governance is not just "a tick box approach".
What we learn from this is that compliance or "ticking boxes" is just one
aspect of good corporate governance.
Good corporate governance goes beyond compliance with laws, regulations or
rules.
It is about ethics, principle (rather than instruction), voluntary
compliance and best practice.
Corporate governance requires directors to lead by example by adhering to
high standards of ethics.
Directors should set exemplary standards of corporate behaviour to
management. By adhering to exemplary ethical standards and conducting
business with excellence, professionalism and integrity, directors enhance
the reputation and business growth in their companies.
Legislation
Due to the escalation of cases involving director corruption, there have
been calls that we come up with stiffer laws and penalties to combat
corporate crime in Zimbabwe.
Some people feel that the existing legislation, such as the Prevention of
Corruption Act, is not adequate to deal with corporate crime.
Others, however, feel that common law provisions are already adequate to
deal with cases of corruption.
Worldwide, cases of corporate scandals and failures have been reported
involving company directors and management.
Governments have reacted differently to these cases.
I will briefly look at how some countries are responding to cases of
corporate crime.
In the United States, following a wave of corporate scandals that centred on
Enron and WorldCom in 2000, Congressional committees were set up to look
into the issue and come up with recommendations.
The Serbanes Oxley Act of 2002 was the final response by the US federal
government aimed at curbing corporate malpractices.
The Act introduced harsh penalties and stiffer prison sentences for
corporate crime.
In the United Kingdom, faced with similar corporate crime concerns as in the
US, several committees were set up to look into ways of fostering
responsible corporate behaviour.
In July 2003, the Combined Code on Corporate Governance was issued.
The code, though not prescriptive in nature, was the UK's solution meant to
address issues relating to corporate crime and restore investor confidence.
The Combined Code was subsequently adopted by and appended to the Listing
Rules of the Financial Services Authority (the regulator of all financial
services and markets in UK).
South Africa, following the country's own experiences of corporate scandals
and failures, in March 2002 produced the King II Report on Corporate
Governance.
The King 11 Report, which has far-reaching recommendations that its
predecessor, the King 1 Report of 1994, states in its preamble that its
objective is to promote the highest standards of corporate governance in
South Africa.
Other African countries, such as Kenya, have not turned a blind eye on
corporate corruption.
They have come up with their own homegrown solutions to promote responsible
corporate behaviour.
Zimbabwean approach
In Zimbabwe, the question is: how should we tackle cases of corporate
corruption and crime?
Should we take the legislative route being advocated by many or should we
take the self-regulation approach? Which way should we go: the American or
British and South African?
I believe that in Zimbabwe we need to create a balance between prescribed
(compulsory) and self-regulation (voluntary practices) as a way of ensuring
good standards of corporate behaviour.
Yes, we need to strengthen the legislative provisions, but at the same time
we need to engage in effective campaigns to educate our business people on
best practices in corporate governance.
Regulation that comes with emotion at times does not achieve its intended
goal.
We need a balanced solution and we should act now before we are engulfed by
the evils of corporate crime.
The following is a summary of my recommendations:
lStrengthen existing legislation to make prosecution of perpetrators of
corporate crime easier and also impose stiffer penalties on offenders.
lReview the investigation mechanisms and procedures and improve the court
processes to speed up prosecutions.
lDevelop a deliberate public policy, through the existing institutional
mechanisms such as the Ministry of State Enterprises and Anti Corruption and
the Anti Corruption Commi-ssion, to specifically deal with business ethics
issues.
lSet up an independent, non-partisan business ethics body to create
awareness of ethics issues, promote debate on ethics, facilitate ethics
research, etc.
lCome up with a homegrown corporate governance code which, among other
things, addresses ethics issues.
lRegulatory bodies such as the Zimbabwe Stock Exchange should consider
introducing provisions on ethical standards in their listing rules.
lCompanies should be encouraged to have internal codes of ethics.
lAllen Choruma can be contacted on the e-mail address: allenc17@juno.com


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Serious need for 'demahosofication of media'

FinGaz

The Geoff Nyarota Column

A FORTNIGHT ago I was invited to make a presentation at the United Nations
in New York on the subject, "Media as a force for change" as part of an
event to commemorate World Press Freedom Day on May 3. A panel discussion
was then held as part of the programme.

Fellow panelists were Helene-Marie Gosselin, director in the New York office
of the Paris-based UNESCO, Anne Cooper, executive director of the Committee
to Protect Journalists, also in New York, and Mariana Sanchez, the
correspondent for the Al Jazeera International bureau in Caracas, Venezuela.
Speaking about the risks that journalists sometimes take to get the story,
Sanchez exhibited a passion for her profession that is uncommon among
journalists in Zimbabwe, where a pervasive culture of fear now inhibits the
pursuit of serious investigative journalism. For me, however, the highlight
of the event was the presentation by Cooper of a report which the CPJ had
released the previous day to mark World Press Freedom Day 2006.
Cooper has travelled widely in Africa, writing features and analyses on a
range of subjects, including the famine and international intervention in
Somalia and the Rwandan refugee crisis in 1994.
Entitled "The World's 10 Most Censored Countries", her organisation's report
outlined the extent to which the world's leading dictatorships had gone
during the year under review in seeking to manipulate the dissemination of
information or to prevent its free flow altogether.
Four countries regarded by the government of Zimbabwe as friends or close
allies are included on the list. The Democratic People's Republic of Korea,
whole close links with the government of President Robert Mugabe, going back
to the early days of our independence are legendary, heads the list. A
strong bond of friendship has been forged since 1981 when North Korean
military trainers encamped in Nyanga and embarked on a programme to train
the soon-to-be infamous Five Brigade, later deployed against dissidents in
Matabeleland, with catastrophic consequences on thousands of Ndebele
peasants. A total of 20 000 are estimated to have lost their lives during
the ruthless campaign.
Thereafter, as cordial relations were cemented between the two governments,
North Korean artisans constructed two landmarks -the National Heroes Acre
and the National Sports Stadium, both of them in Harare.
"North Korea has wedded the traditional Confucian ideal of social order to
the Stalinist model of an authoritarian communist state to create the
world's deepest information void," the CPJ report says of the media
situation inherited by the all-powerful President, Kim Jong Il, from his
more formidable father Kim Il Sung's who died in 1994.
The North Korean government controls all domestic radio and television
networks, as well as all newspapers. The report says while all radio and
television receivers are locked to government-specified frequencies, news
content is supplied almost entirely by the official Korean Central News
Agency (KCNA). The situation in Zimbabwe is only a slight variation of this
totalitarian obsession with self-serving media control.
"Following a munitions train explosion in April 2004," KCNA reported
typically, "citizens displayed the spirit of guarding the leader with their
very lives by rushing into burning buildings to save portraits of Kim before
searching for their family members or saving their household goods."
Other friends of the government of Zimbabwe, whose names appear on the
iniquitous list are Cuba, Libya and Equatorial Guinea, whose President
Teodoro Obiang Nguema Mbassogo is cited as the worst censorship offender on
the African continent. He was sumptuously wined and dined on a recent state
visit to Zimbabwe. Equatorial Guinea occupies fourth position on the list of
the world's worst enforcers of press censorship. While state-run radio
describes Obiang as "the country's God," in Harare former politician Tony
Gara once described President Mugabe as "the other son of God."
In one of those paradoxes of Zimbabwean politics Gara hastily descended into
political oblivion, notwithstanding his fawning exaltation of President
Mugabe, while ZANU PF backbencher Dzikamai Mavhaire, who dared to tell the
President that it was time to retire many years ago, survived to bounce back
onto the mainstream of ruling party politics.
As in Zimbabwe, all broadcast media in Equatorial Guinea are state-owned,
that is all except for the country's single privately-owned broadcaster, a
radio and television network. It is owned by the president's son, Teodorino
Obiang Nguema, whom he favours as successor. Naturally Obiang's ruthless
regime does not brook any criticism, which is not surprising, considering he
deposed his uncle in 1979 in a violent coup d'Útat, in which the previous
president was killed.
The CPJ report quotes an exiled press freedom group which describes the
state broadcasters of Equatorial Guinea as "pure governmental instruments in
the service of the dictatorship, dedicated uniquely and exclusively to
political narcissism and the ideological propaganda of the regime in place".
Such apt characterisation would not be entirely misplaced if applied to the
performance of the Zimbabwean state broadcaster, especially since the
watershed year of 2000, when Professor Jonathan Moyo assumed the reins of
power as minister of information with a singular determination to further
subjugate the media, with cataclysmic consequences on the practice of
journalism.
Meanwhile, the bond of friendship between Equatorial Guinea and Zimbabwe has
grown from strength to strength since a military coup against the West
African strongman was foiled in 2004. A chartered plane landed in Harare,
Zimbabwe, and was promptly detained by authorities who claimed mercenaries
had stopped over to refuel and pick up a supply of ammunition.
After the event at the United Nations I congratulated Ann Cooper on her
report and remarked that Zimbabwe did not feature among the world's most
heavily censored countries. She explained that the country had been a very
strong contender but the competition had been particularly tough. It appears
that the government's cunningly selective heavy-handedness had rescued
Zimbabwe from inclusion on the dishonourable list.
While the Zimbabwean government has enforced censorship through forceful
coercion such as harassment and arrest of journalists, through the violence
of torture and bomb attacks and, finally, through draconian legislation such
as AIPPA and POSA, it has maintained a semblance of press freedom. A few
critical newspapers are allowed to circulate by government, safe in the
knowledge that they are of limited circulation, away from ZANU PF's
potential strongholds - the high-density urban residential and the rural
areas.
The greatest indictment on the media of Zimbabwe has been the resultant
deterioration in the performance of the media as a result of a pervasive
culture of self-censorship engendered by fear. Equally perilous has been the
general decline in the standard of professional journalism, especially in
the category of investigative reporting.
Most of the decline in the quality of journalism is directly attributable to
the deterioration in the quality of journalism training offered in recent
years by the Harare Polytechnic. The quality of journalism that the
Polytechnic has produced under the stewardship of the controversial Dr
Tafataona Mahoso is demonstrated by the report of a political meeting
addressed recently in Manchester in the United Kingdom by Professor Arthur
Mutambara, leader of the breakaway faction of the Movement for Democratic
Change (MDC).
Three Internet-based news websites reported on the event after, presumably
covering the meeting. One website estimated attendance at 500 people. The
estimate of the second site was less generous at 400. Then came the
bombshell - the third website estimated the figure at a paltry 35. While
consensus was never reached, the much more modest attendance at another
meeting addressed by the same politician in London a week later, a video
recording of which I had the good fortune to view, suggested clearly that
the first two figures might have suffered from Zimbabwe's perennial
problem - runaway inflation.
I believe sincerely that one of the major media initiatives of post-Mugabe
Zimbabwe will have to be a comprehensive programme of retraining and
reorientation of journalists, who must overcome the culture of fear that has
been inculcated in them by years of subservient journalism under Professor
Moyo and Dr Mahoso.
In the absence of such reorientation the Zimbabwean media run the very real
risk that, for argument's sake, in the event of the MDC forming the next
government of Zimbabwe, the Herald would promptly execute a political
somersault to hero-worship either Morgan Tsvangirai, Arthur Mutambara or
Welshman Ncube as President. Meanwhile if the Daily News were to be revived
a regular caller in its editorial offices would be one Robert Mugabe,
assuming ZANU PF retained their incurable faith in his leadership - there to
complain bitterly about harassment or vote-rigging by the MDC.
Another facet of such a retraining programme would be in the area of serious
investigative journalism. Armed with the relevant skills, journalists are
better able to investigate and expose the rampant corruption, abject
poverty, the abuse of human rights and the mismanagement of the economy that
have conspired to bring our otherwise beautiful and potentially prosperous
country down to its knees.
If such a programme of "demahosofication of the media" if I may coin a
phrase, were properly planned, financed and executed, the benefits to be
derived by the public from accurate, interesting and relevant news and
information, as disseminated by professional and credible media, effectively
playing their crucial role as the Fourth Estate, would be immense.
Such professional media, by assuming their critical responsibility as
watchdogs over government and the corporate world, would enforce
transparency and accountability on them. The media would, in those
circumstances, become a genuine force for political change.
gnyarota@yahoo.com


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Advice to Mutambara from a friend

FinGaz

Inside Politics with Dr Petina Gappah

ARTHUR Mutambara's statements in response to questions from the media at the
Gweru Press Club on April 22 cannot go unchallenged.

I have been an admirer of Mutambara since I met him when I was a first-year
law student in June 1991, on the day before he graduated from the University
of Zimbabwe.
I congratulated him upon his recent entry into politics and told him that I
wished him well.
And for the record, I have many good friends on both sides of the MDC
divide; indeed, I was privileged to host Gibson Sibanda and Sekai Holland in
my home when they came to Geneva in 2004, and arranged for them to have
dinner and an animated discussion with a number of Zimbabweans in Geneva on
that occasion.
I therefore write this not to jump on the anti-Mutambara wagon, but because
I have been increasingly dismayed by Mutambara's apparent lack of humility
as well as by his and his supporters' apparent inability to take criticism.
I have become particularly concerned about various statements that seem to
be the result of shallow analysis and pseudo-intellectualism.
His statements that the MDC - the Movement for Democratic Change - had in
the past chosen the wrong allies, and that it should not have allied itself
with the West because Zimbabwean combatants were trained in China and Russia
and Cuba, reveal a superficial understanding of recent history, and a
failure to appreciate realpolitik.
That the interests of Cuba, China and Russia and, I would add, North Korea
coincided with ours at a particular point in time does not make them our
natural allies for all time.
Nor does it mean that Britain, the United States and others who did not
contribute directly to the armed struggle are our natural enemies forever.
In any event, I am sure that there are many in the Zimbabwean government who
could tell Mutambara that even when not training combatants, those same
countries that he now scorns provided political asylum to many of our exiled
comrades.
And if our foreign policy is to be determined on the basis of who provided
direct support to our armed struggle, why then is Mutambara supping with
Thabo Mbeki, as South Africa supported Ian Smith?
And surely, it cannot be that the regime has changed, because that is
equally true of the regimes of the countries that Mutambara says the MDC
should not be associated with.
I would encourage Mutambara and his advisers to look beyond convenient
soundbites and cheap rhetoric.
Intellectuals of the stature of Mutambara and his advisers must surely be
aware of the extent to which Africa was used as a pawn in the fight for
influence during the Cold War?
Cuba, Russia, China and North Korea were unstinting in their largesse: they
plied African nations with slogans and AK47s for the same reasons that the
Western powers turned a blind eye to the excesses of dictators such as
Mobutu Sese Seko, Sekou Toure and Kamuzu Banda.
And it is worth noting that even as the worthy allies that Mutambara lauds
were training our combatants, Russian medical students were being taught
that Africans were genetically inferior to other races, and its people were
being told that communism was necessary to save Africans from their own
savagery.
The challenge for small developing nations such as Zimbabwe in the aftermath
of the Cold War is to ensure that our foreign policy reflects our national
interest, which must be rooted in the imperative of development, and not in
the outdated slogans that formed the preambles to Soviet-era solidarity
pacts.
Mutambara has also said that the leader for the people of Zimbabwe must be
"respected" and, by implication, approved by regional African leaders.
This is a depressing echo from the past.
Africa has been working hard to jettison the "solidarity at all costs"
mentality of the old Organisation of African Unity, and here it is again,
the same old wine in a brand spanking new bottle.
Mutambara may want to reflect further on this because this sounds
dangerously like the kind of thing that President Robert Mugabe, Obiang
Nguema, King Mswati and the rest of that club tell each other as they
embrace on their state visits and pose for photographs at meaningless
conferences.
These are their words of comfort to each other even as repression mounts in
Equatorial Guinea and Swaziland, people are murdered and women are raped in
Darfur, and the houses of the poor are destroyed in Zimbabwe.
Mutambara may also want to reflect on whether it really is more acceptable
to be a puppet if the one pulling the strings is black.
Wole Soyinka has said eloquently that he does not care if the boot
oppressing him covers a black foot; all he wants is that it is taken off his
head.
And on Mutambara's continuing evocation of pan-Africanist principles and
standing on the shoulders of Nikita Mangena, Josiah Tongogara and others, I
would say to him, and again quoting Soyinka, that a tiger does not proclaim
its tigritude: it pounces.
I encourage Mutambara to pounce by dropping the rhetoric and sharing with us
the economic blueprint that he promised we would see within two weeks of his
coming into office.
And finally, I wish to use this opportunity to encourage my fellow
Zimbabweans, especially those who do not wish to push a particular political
agenda, to assist the national discourse by looking critically at these men:
Morgan Tsvangirai, Mutambara and Mugabe; indeed at any man or woman who
would be our leader.
We should not allow ourselves to fall victim to the "we need a saviour"
mentality.
Zimbabwe was not meant for one person to own, however many thousands of
people he addresses at rallies, however many degrees he has earned, or
however many years that he spent in the bush.
The country is for all of us to build, and we are all entitled to make our
contribution, regardless of our level of education, our station in life, or
our lack of liberation war credentials.
We have already wasted 26 years of our freedom. I, for one, refuse to waste
any more.
Dr Petina Gappah is a counsel at the Advisory Centre on WTO Law in Geneva,
Switzerland.


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The truth, like murder will out

FinGaz

Perspectives with Jonathan Maphenduka

THERE is a strong belief that it pays to lie, distort or twist the truth,
and a lot of money is expended financing propaganda. You remember Hitler's
Goebbels who believed the war could be won by misrepresenting the truth.

But there comes a time when the truth, like murder, will out.
Last week, the flagship of the country's public print media, The Sunday
Mail, treated its readers to a front page lead story with a banner headline:
Inflation Set To Tumble.
This came exactly two days after the Central Statistical Office (CSO)
reported an increase in inflation from 913.6 percent in March to 1 042.9
percent in April.
Although the report quoted "experts", the headline was not justified in the
body of the report. The lead story, itself shorn of credible information to
back up the claim, was supported by a first page editorial which repeated
the essence of the main report.
The introduction of the main story asked Zimbabweans not to be alarmed by
the increase in inflation, tacitly claiming "the economy is set to be
revived." The revival would come through "a combination of natural factors"
and government initiatives recently announced.
The natural factors were given as the season's food harvest while NEDPP was
the other element in the combination to address major drivers of inflation -
food, fuel, electricity and scarcity of foreign currency.
No mention was made as to how foreign currency inflows would be improved
with tobacco production, for example, tumbling from 260 million kilos three
years ago to this season's paltry figure of between 50 and 60 million kilos.
Neither was mention made of the fact that the current refurbishment of the
country's main electricity generators, Hwange and Kariba South would take
between 24 and 42 months to be completed to relieve current pressure on
import supplies.
There was no mention either of the fact that electricity is the engine that
drives all sectors of the economy with this winter's cropping programme
bound to suffer, and farmers already predicting a sharp decline in the yield
of winter wheat.
The need to import electricity will remain with the country for 42 months at
the very least, and could remain so for the next seven years or longer
depending on how soon the government plans to start construction of the
stalled Batoka Gorge Scheme.
Had development of Batoka begun, as once advised, in 1993, it would have
come on stream in 2000, with its l 600 MW yield - enough to have forestalled
imports from that year, and leaving the country with enough foreign currency
to sustain Hwange and Kariba South.
There would have been no need for the country to be running around in 2006
to find money to import supplies.
Government last week, admitting Batoka had been "forgotten", appeared ready
to give the project a new look. But it is not a comforting prospect to
realise that the project will take seven years to complete. If construction
were to begin this year - and this is unlikely as colossal sums of money
must be found to finance the project - it will only come on stream in 2013
at the very earliest.
The daunting task facing the country is how this crisis will be managed
between now and when Batoka is completed.
Authorities like to pass the buck by blaming the current problems on our
neighbours' inability to facilitate credit lines, when the painful fact is
that of poor planning on the part of government.
The electricity crisis alone will have a devastating effect on the economy
with prospects of mass retrenchment of labour already looming high. The
economy, which is already on its knees due to a variety of factors, is
likely to suffer even more this winter. There is nothing on the horizon to
suggest that the decline will be reversed sufficiently to meet the
challenges besetting it.
The idea that the mere announcement of NEDPP has started yielding results is
a dutiful reflection of wishful thinking, unbacked as it is by an objective
analysis of the situation. The country has lost too much of its capacity to
produce and export commodities in large volumes to earn enough foreign
currency to restore it to a path of prosperity in the short-term.
For instance it was reported with so much glee that the producer price of
maize has been increased from $2.7 million to the current figure of $13.3
million per tonne. While one is aware of the good the new prices will bring
to the producer, it will not solve the problem of imported inputs
The other adverse effect of the increase is that it will help to increase
the cost of living when unemployment is soaring. The producer prices of food
commodities therefore are unlikely to contribute to poverty-alleviation.
It was reported that this season will see l.8 million tonnes of maize
harvested, with half of that yield remaining with producers while the other
half is delivered to the GMB to feed urban dwellers.
The thrust of the report is that there will be enough food to feed the
nation. This, it is suggested, will send food prices tumbling.
The government's NEDPP - the latest carbon copy of earlier initiatives - is
offered as a panacea to solve all the problems facing the country. This
offered solution does not take into account the host of problems spawned by
the four major drivers of inflation.
It was asserted that NEDPP has already begun yielding positive results when
its optimistic authors see such results within six months of its launch.
But for the programme to produce laudable results within that time frame,
all things must be equal, meaning that all sectors of the economy must be
operating at optimum capacity with nothing rocking the boat.
This means adequate electricity, foreign currency and all other elements
To Page 31
needed for a smooth operation. But unless one is a crystal ball gazer, it is
difficult to see ideal conditions being realised under NEDPP in the
short-term.
It was reported that apart from "doing away" with imports of grain, the
other objective of the programme is to "encourage foreign currency inflows
into the economy", and that exporters had been given incentives to make this
possible.
But these incentives are offered every time government comes up with a new
economic turnaround programme. But the novelty of these new incentives is
not clear. Or is it a mere exercise in wishful thinking?
The Zimbabwe Electricity Supply Authority (ZESA), ZISCO, Hwange Colliery and
NOCZIM have been "identified" as critical utilities to drive NEDPP. What is
required is not their identification but the ability to make them deliver
their services to the economy, which is not happening just now.
They are all hamstrung by shortages of foreign currency. NOCZIM has not
succeeded in bringing enough fuel to "do away" with the black market which
is just now ravaging all sectors of the economy.
How can NEDPP realise its objectives in the planned time span when the
economy is barely surviving on costly overdrafts?
The idea that ZESA can restore power generation to Bulawayo, Munyati, Hwange
and Harare thermal power stations overnight is unrealistic when Hwange
Colliery is failing to produce enough coal to meet domestic needs.
Even the idea that ZESA can solve the coal problem by going into mining coal
for its own needs cannot work in the short-term. Mining needs imported
equipment.


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Made plucks figures from the air!

FinGaz

No Holds Barred with Gondo Gushungo

I HAVE nothing against Agriculture Minister Joseph Made. There is no earthly
reason to dislike him as a person.

But the picture changes when one looks at him as a Minister of the
government of Zimbabwe.
He sees nothing wrong with playing Russian roulette with people's lives.
Thus he has in the past lied to the dregs of infamy about the country's food
security situation. And only he knows why he plays this dangerous game. But
this he has done at incalculable cost to the nation which by February this
year forked out US$135 million to finance grain imports at a time when
foreign currency is flowing into the country in dribs and drabs on the back
of faltering export performance.
I am sure Zimbabwe recalls how the minister gave us one for the text books
when a few years ago he claimed that his bird's eye view preliminary
assessment of the country's crop situation, undertaken from a helicopter,
showed that Zimbabwe would have a bumper harvest. The figure he gave was, if
my memory serves me right, 2.4 million tonnes.
But both the Famine Early Warning Systems Network (FEWSNET) and Freidrich
Ebert Foundation (FEF) had, at that time, rightly projected a grain deficit
of between 600 000 and 900 000 tonnes in the same year. The government, to
whom the truth has always been bizarre, got bent out of shape. In its view,
western governments pushing for regime change were using organisations such
as FEWSNET and FEF as a porniard with which to prick its bloated bladder of
lies and thus exposing it.
And how did it respond to all those bent on piercing through its
self-serving veils of secrecy over the food security situation? It
arbitrarily cancelled a United Nations crop assessment mission. We saw a
repeat of this unfortunate incident when government last month blocked the
Food and Agriculture Organisation (FAO) from scrutinising Zimbabwe's crop
situation on the pretext that Zimbabwe is a sovereign state! Again, this was
after the United States Department of Agriculture had projected a maize
yield of between 800 000 and 900 000 tonnes for the just-ended season.
Thus government jitters over the grain figures have raised so many
questions.
What has sovereignty got to do with it? Why block these institutions that
undertake crop assessments for so many countries so that they will be better
prepared to mobilise additional grain to bridge deficits? Are these not the
same organisations that the government has always looked up to as ambulances
to pick up the casualties of its bad policies when they are called in for
humanitarian assistance to alleviate hunger? Is it by sheer coincidence that
every time government wants to project a bumper harvest it cancels crop
assessments, even those that are supposed to be conducted at the invitation
and with the participation of the host government? Is this the behaviour of
an open and transparent government that has nothing to hide?
This year some senior government officials, who should know better, darkly
hinted at the spectre of yet another poor harvest. They cited sub-optimal
utilisation of land resulting from crippling shortages of seed, fertiliser,
tillage facilities and fuel, which have blighted successive agricultural
seasons. Local independent agricultural experts have observed as much for
the very same reasons. So has no less a person than President Robert Mugabe
on the eve of his 82nd birthday.
But Made this week sang from his own hymn sheet. He told a Parliamentary
Portfolio Committee on Social Welfare that Zimbabwe will produce 1.8 million
tonnes of maize in the just ended season. Isn't it curious that Zimbabwe is
supposed to, all of a sudden, have produced just enough maize to meet its
annual national requirements? Suffice to say blessed are the believers!
How on earth could Zimbabwe have managed to produce that much from the ruins
of agriculture and under the difficult circumstances? If reason consists of
seeing things the way they really are, why then do we have these striking
discrepancies between Made's figures and those of organisations whose
forecasts in the past have been spot on and which also have played an
inestimable role in averting human crises of catastrophic proportions every
time hunger stalked the nation?
Who is fooling who here? Who are we most likely to believe? The answer is
obvious given the credibility gap in the last food debacle. The nation is
once again being led up the garden path insofar as the food security
situation is concerned. And it can believe the minister at its own peril.
After all, he is the reason the country's food security situation is in such
a precarious position.
True the state media where lies in all shapes and sizes go forth
unchallenged as long as they portray the establishment in good light,
reported it as a solid fact. But Zimbabwe knows what to believe because the
medium is the message.
Even if I wanted to give Made the benefit of the doubt, it is difficult to
trust what he says. There is always this lingering fear that, as happened
before, Zimbabwe might be caught asleep at the switch once again, when it
would have to fight a rearguard action to stave-off famine? It is a question
of credibility.
What gave away Made as someone who is being economic with the truth are his
claims that even though the 1.8 million tonnes is enough for the country to
feed itself and restock the strategic grain reserve, Zimbabwe will continue
to import maize to have a strategic reserve to cover 24 months.
I fail to see the logic behind this strategy particularly at a time when the
country which, because of an unprecedented foreign currency crunch, has had
to starve other sectors of the economy to finance grain imports. It smacks
of upside down priorities which even the ZANU PF government, known for its
ruinous voodoo economics, wouldn't dare to pursue especially given the
seasonality of the country's major foreign currency inflows. Does it ever
occur to Made that such unnecessary grain imports militate against the
country's anti-inflation measures and instead result in imported inflation
(cost-push) which is transmitted to consumers in the form of higher prices?
Without sound economic logic therefore, there is only one explanation for
the proposed continued grain imports: Zimbabwe has once again failed to
produce enough of the staple crop and grain imports are inevitable. But
government cannot admit this embarrassing cold hard fact because it would
give credence to claims that its much-vaunted "successful" land reform
programme was the seal of death for the once-vibrant agricultural sector.
Thus the whole situation has degenerated into a game of political-point
scoring. And the easiest way out is to paint a rosier-than-real picture of
the food situation. It does not matter a brass farthing what the
consequences would be to the most vulnerable groups who normally bear the
sharpest edge of the knife when hunger strikes.
Of course it goes without saying that the most prudent thing for me would
have been to hedge my bets on the likely outcome of the agricultural season.
But in the final analysis there is the inescapable impression that Made is
inflating the figures for political reasons, as he has done in the past. In
the unlikely event that he is proved right, I will eat the proverbial humble
pie and apologise.
But for now I have to say that I feel the minister is just being his usual
self: clearly lying through his teeth. It is instructive to note that I am
not alone in thinking that Made places too much faith in the figment of his
imagination. The figure of 1.8 million tonnes of maize could therefore be
something he has just plucked out of the air after those aerial surveys.


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FinGaz Letters

Govt's criminal action on Kondozi

EDITOR - It is quite obvious that this government has a death wish for
anything working well in the country. Examples of this are too numerous to
mention but maybe I need to mention just a few.
Urban councils have been destroyed by government in its deliberate refusal
to pay for any services rendered to government; the thriving informal market
that contributed to the livelihood of millions of people was destroyed
through Murambatsvina. This dastardly act by government against its own
people is unparalleled; the economy has been so run-down it does not exist
anymore.
The MDC is for land reform but not the covetous manner in which it was done
by the government, where it has been effectively used as an instrument for
patronage.
In 2004, the government coveted the well run Kondozi, which provided
employment, including out growers, for over 5000 people. The farm was
bringing in US$15 million per annum from 224 hectares. One would have
expected some of these ministers who had already taken similar farms to
aspire to do better. No, this type of profitable farming is unZimbabwean!
Kondozi must be destroyed. The best way to do so efficiently is to hand it
over to ARDA, which is totally unable to make a profit. It has huge debts
from its farming operations. There have been numerous stories that it also
tills land for the fortunate ones.
Giving Kondozi to ARDA was by careful design so that the plundering and
looting could be done more efficiently. If an audit was to be done, it may
not surprise some of us if the findings showed us that ARDA used its trucks
to deliver the plundered equipment to the beneficiaries.
Out of the 224ha, only 40 ha are under cultivation by, of all people, the
army. How do you expect soldiers to be farmers when these same individuals
are failing to farm the land given to them?
Statutory Instrument 135A, forbids anybody to sell maize and wheat and their
products to anybody other than to the GMB. In short, this instrument
criminalises maize trade even among the hungry within their communities. In
this country, it is criminal to destroy property.
When this government can criminalise the mere selling of maize to my
neighbour who is starving and bless the malicious damage to Kondozi and many
other Kondozis in the country, they have ceased to be a government. This
country needs to be rescued from these crimimals.

Renson Gasela
Secretary for Land and Agriculture
MDC
-----------
Panel's verdict on Trust, Royal banks is unfair

EDITOR - I do not agree with the findings of the panel on the appeal of
Trust and Royal banks as they focused on the implications of the clousure of
ZABG and not on what the former are entitled to.
The RBZ is an interested party to this saga hence there is no impartiality
in the way the matter was handled. The RBZ and everyone who cares knows that
the panel's findings are shallow. Trust and Royal banks were sacrificed for
the survival of ZABG, not that they did not have a case.
Almost every bank including the RBZ is operating under extraodinary
circumstances and the RBZ governor has mentioned it on several occasions
that the current economic sitution requires extraodinary measures. So the
issue of corporate governance being touted as the reason why these banks
have been punished does not wash.

Mabasa Mhepo
Australia

--------
All is fair in love and war

EDITOR - I would like to congratulate Geoff Nyarota for an indepth look at
how the Gukurahundi atrocities have been used to score political points. I
think the reason why the Gukurahundi issue continues to be a scar on the
national conscience is that it has not been dealt with sincerely and openly.
I find it surprising that today, most people do not acknowledge the terror,
banditry and heinous crimes committed by dissidents and yet they are quick
to point a finger at certain people in and outside government for the
excesses of the Fifth Brigade.
The truth is that the dissidents were a reality, the dissidents had
sponsors, some of them still alive and in Zimbabwe today. Should we not
charge them with crimes against humanity, just as we have to take this
regime to task for the mess we are in?
Otherwise, all is fair in love and war.

Irvine Moyo
Harare

--------
Lay off the Ndebeles

EDITOR - Geoff Nyarota should lay off the Ndebeles. Why is he on a one-man
mission to find all that is wrong with one grouping of people?
Zimbabwe is in a mess today because editors like him licked the boots of
ZANU PF without taking them to task over their unworkable policies. Let the
nation unite against this government that has only managed to stay in power
by creating divisions among the people. No to tribalism Geoff - we have seen
the evil that it can do to others. We are one Zimbabwe, one people.

Simba Chigutiro
United States
---------
MDC will not be swayed by this political upstart

EDITOR - Zimbabwe is faced with an unprecedented multi-layered crisis
characterised by worsening unemployment, a stratospheric inflation rate, a
dehumanising food crisis, a crippling HIV/AIDS scourge and a collapsed
economy that has become a collective African shame.
Today, the challenge for all democratic forces is to harness their
collective efforts and direct them towards this dictatorship that has
reduced ordinary Zimbabwean citizens to paupers in their own motherland.
The challenge is to maintain the spotlight on the ZANU PF government's
shortcomings because it is the author and instigator of this national
crisis. The challenge is to remain focused on ZANU PF and not to engage in
robotical diversionary tactics to sway national attention from the real
problems facing Zimbabwe.
Some of us note with concern the fixation that one Arthur Mutambara has with
MDC president Morgan Tsvangirai. At every gathering, every hall and in every
church where he is fortunate enough to address his usual embarrassing small
crowds, Mutambara spares his best arsenal not for President Robert Mugabe
and ZANU PF, but for Morgan Tsvangirai and the MDC.
Mutambara has shown that his biggest nemesis on the political turf is not
President Mugabe but Tsvangirai, a gallant son of the soil who has built a
formidable political movement to put a stop to ZANU PF's excesses.
Mutambara harps on Tsvangirai's supposed lack of "organisational capacity"
and "gravitas", whatever that means. But he is clinging on to the MDC brand,
a party that was built and woven around the organisational capability of its
leader. It's a contradiction in terms, which is shocking coming from someone
who purports to have leadership "gravitas" and intellectual clarity.
In politics, intellectual clarity and "gravitas" are not enough to guarantee
you support from your own clansmen including Chief Mutambara. Being a
robotics professor does not immediately translate itself into grassroots
support from the old woman in Rugoyi or the AIDS orphan in Mukandabhutsu, as
Mutambara himself will testify.
Politics is about being able to capture the national pulse as Tsvangirai has
evidently done judging by the millions across the country who continue to
see him as their only source of hope.
Mutambara is a jelly-kneed opportunist who boarded the MDC train long after
it had left the main station and immediately shouted himself hoarse that he
was a better driver than the man he found at the wheel. The man who had
negotiated all the dangerous curves long before the arrogant passenger came
on board.
While I acknowledge that he was an energetic student leader in his heyday,
Mutambara has started compromising with the dictatorship. Mutambara should
simply know that politics is not about the educated.
The millions of people who are very crucial on the political chessboard do
not have degrees but they remain a vital cog in the resolution of the
national crisis.
The robotics professor is simply arrogant and ideologically confused. How
can he tell his London audience, where he and his entourage raised 10
pounds, that he believes in jambanja and that he is anti-Senate, the two
main issues that must surely make everyone wonder why he continues to hobnob
with cowardly characters like Welshman Ncube.
Power-hungry political upstarts such as Arthur Mutambara will not distract
the MDC from the people's project. Light shall surely strike him on his way
to Budiriro, where a bold statement will be made that the party remains
focused and unshaken. The MDC juggernaut shall continue to roll.

Frank Matandirotya
Harare

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