Five “mysteries” in Zimbabwe’s deepening crisis

via Five “mysteries” in Zim’s deepening crisis 27/03/2014 by Irene Madongo FT.com NewZimbabwe

ZIMBABWE is suffering from capital flight, a liquidity crunch, regular power outages, falling commodity prices and other manifestations of an economic crisis.

But beyond these well-documented woes, there are several “mysteries” that throw up searching governance questions for the regime of Robert Mugabe, the 90-year-old president.

CEOs’ sky high pay

The first mystery is how some CEOs have managed to pay themselves so much.Ordinary government workers can earn as little as $300 a month, but the CEOs of some government-linked companies have earned elephantine salaries.

Cuthbert Dube, former CEO of the Premier Service Medical Aid Society (PSMAS), a state enterprise, earned a basic monthly salary of US$230,000 in 2012, according to The Herald, a state-owned newspaper, quoting documents it recently obtained.

This was in spite of the fact that his company owed some $38m in unpaid bills for medical services at the end of last year. This salary level would mean that Dube was earning more in a month than, say, David Cameron, UK prime minister, earns in a year.

His was not the only large salary. The CEOs of NetOne (US$43,693 monthly) and the Zimbabwe Broadcasting Corporation (ZBC) head (US$37,050 monthly) also have high pay and benefits packages.

Acting to curb such largesse, Patrick Chinamasa, finance minister, said last week that a salary cap of US$6,000 per month is to be imposed, though it was unclear if Harare could make the new rule stick.

Asked to comment, a ZBC spokesman said it is “not appropriate” for him to comment on the salary of the CEO, but said changes had been made at the corporation including appointing a new board of directors.

He added that it is “important that the remuneration levels be competitive but falling within the restrictions of our levels of income/revenue.” PSMAS and Net One did not respond to requests for confirmation of the salary figures by the time of publication.

Missing diamond money

The second mystery is how a state that produces so many diamonds can collect so little in dividends and taxes from diamond companies.

This week, former finance minister Tendai Biti told beyondbrics that by the time he stepped down last year, the Treasury had received less than US$5m from diamond companies between January and July 2013.This was down from the $247m that Biti said they paid in 2010 – even though 2013 was a bumper year for diamond production, according to government officials.

In 2013, a parliamentary committee report highlighted “serious discrepancies” between what the government receives from the sector and what the diamond mining companies claim to have remitted to Treasury.

Meagre gold reserves

Mysterious too is how a major gold producer holds such depleted gold reserves.

Zimbabwe produced 13 tonnes of gold in 2013 worth US$622m, but it holds gold coins valued at just $501,390 as its only reserves – enough to buy only 1,400 tonnes of maize, Reuters quoted the finance ministry as saying this month.

The new central bank governor’s PhD

Mystery No4 – how real is the PhD of the newly appointed central bank governor?

John Mangudya, appointed this month to be governor of the Reserve Bank of Zimbabwe (the central bank), is identified by the state-owned Sunday Mail as having a Doctorate from Washington International University (WIU).

However, this “university” has not sought formal accreditation in the US and several US authorities – including the Oregon Office of Degree Authorization, the Michigan Civil Service Commission and the Texas Higher Education Coordinating Board – have warned that its “degrees” are not recognised.

On its own website, WIU mentions that it is a ‘cyberuniversity’ with ‘no classrooms’ and ‘no deadlines’, and its doctorates can be obtained after just one year of study.

One country, 10 currencies

The last mystery is why a landlocked country with just 13m people needs nine currencies.

In January, four new currencies – the Australian dollar, the Chinese renminbi, the Indian rupee and the Japanese yen – were added to the five already regarded as legal tender – the Botswana pula, the British pound, the euro, the South African rand and the US dollar.

One answer is obvious; the Zimbabwe dollar’s value has been so ravaged by hyperinflation that dollarisation tends to add economic stability. But are nine legal currencies really necessary to achieve dollarisation, and don’t people using all nine find it a bit confusing dealing between them all?

 

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23 comments on “Five “mysteries” in Zimbabwe’s deepening crisis
  1. roving ambassador. says:

    Thats Mugabe’s Zimbabwe. Zanu is very happy with the situation they even have time to celebrate the dear leader’s birthday.
    More of the same. You can not expect the dinosaur party which presided over the destruction of our economy since 1990 to ever change . The destruction team is still the same.
    Down with the treasonous malcontent looters.
    Sellouts.

  2. Small axe says:

    If you remember he boasted about Zimbabwe being the only country in the world where everyone was a millionaire during the crash of the dollar. He thought he was making a good joke but no one was laughing.

  3. Mlimo says:

    There is no mystery just plain looting by thugs posing as a government this is the zanupf mafia their interests are not nor have ever been for the betterment of the people or the pun try there is evidence that Mugabe started his looting in December 1979 even before he came to power

  4. The Mind Boggles says:

    Exactly no mystery , why bother asking these questions a five year old can work it out!!!!

    • apolitical says:

      You cant work it out!
      Or are you not five yet!
      There is a great deal of sabotage going on and its so bad that its getting hard to know what id genuine.
      MDC lost, but if we sabotage Zesa and the economy we can take over.
      That’s why MDC MPs are able to preempt zesa problems with cross saying what is going to happen in Zesa.
      On the economic scene propaganda press and lies about the courrency changing back to thev zim dollar causing a run on banks.
      They reasoned correctly that people are too dim to realize what is going on – I mean the zim dollar scare was an accident.
      And the fact that we were able to supply enough energy to provide for 100% of industry and now with the same equipment cant provide for 40% industry – well we cant count can we.
      Maybe the extra power is getting lost.
      Or could be that we need new power stations because the generators have disappeared.
      Reality is that power stations are told not to produce power, sabotage of pouring cold water over hot generators takes place bending shafts and so that a few crooks can get a job in government and loot, we have to pay more for power.
      We need common sense schools to open and people to become responsible to say no to sabotage which will affect our children.

      • Tom says:

        Yeah but the problem with your argument is you are a big fat liar. ZANU never maintained the power equipment, or the roads or their air planes or the water system. And cross, the workers, schoolchildren and the village donkey could all work out what comes next. Seriously apo, a human being that thinks like you do shouldn’t be capable of typing. Quit this ridiculous act and tell us what you really think.

  5. RR says:

    He also boasted about his cabinet having the most PhD’s of any government in the world. Now you know how. Cyber universities!. Now you why the economy and the country are completely stuffed.

    • apolitical says:

      Think you should give your Phd back because you have it wrong.

    • maita says:

      Cyber economy run by cyber PHDs. One thing which Zimbabweans will never comprehend is why we are poor, it is our choice of leadership period. Mbiri dzekuhondo ndodzatikuvadza. We used numbers not skill in the war ndosaka even now we don’t look at quality but quantity in what we do. many civil servants, many cabinet ministers, many salary perks, many wives, many cars. Zanla cadres were very many but poorly equiped and trained, they used the adage power in numbers.

  6. Ripp off says:

    Yes This is factual, there are many cyber universities In the United States who offer fake Doctorates,for 1 Year of study all you are required to do is complete a Thesis on the doctorate you require which can be copied from an origonal well documented Thesis written by someone else. After your Payment, the Doctorate is yours.After only one years study!!!? why do zimbabweians not Go to the University of Zimbabwe that is Recognized, for their Degrees? ,Because a senior schoolboy can get a degree from a cyber university after 1 year thats why.

  7. harper says:

    Educational qualification mysteries are nothing new. One ZANU deployee to Customs had a degree from Aston University but two years later still did not know where in the UK it was based. I stood in the queue for the photocopier in Cecil House while the Director of a Government Department added two extra “O” levels to his son’s certificate. Obert was appointed a Military and Civil Service Commissioner on the basis of relevant educational qualifications I wonder how he acquired them and why he had not mentioned them previously. To paraphrase Emmerson – “If I say someone has a PhD, he has a PhD. Evidence Par Excellence”. Check out Hansard

  8. wow wow says:

    Finally as can be seen there is nothing left, it is the story of Africa. Traditionally now, there is a waiting period of a decade or more while the old generation dies away and then perhaps Zimbabwe will begin to rise out of the ashes.

  9. Smart Talk says:

    I vanhu vakaita saana Apolitical vanhu vakangotorwa kumusha nana sekuru vavo vari muZANU ndokupinzwa chiCIO kuti vauraye vanhu nekuti pfungwa dzacho dzakazara kuumba mombe dzemadhaka. You are very STUPID. Where on earth have you come across an employee who can destroy the equipment that he is manning, worse still where he gets his salary from. Verenga mabhuku emagetsi kana uchida kuziva kuti zviri kufamba sei mu Power Station. Once more YOU ARE VERY STUPID. Those guys are very much hardworking to an extend that the go an extra mile to make sure that they keep part of Zimbabwe alight. Mind you, its you and your sekurus in ZANU PF who has destroyed these plants. Smith regime had plans to build STAGE 3 at Hwange Power Station, where is after 34 years? How many times have you read in the newspapers that they are busy constructing Stage at Hwange Power Station, of which by now ingadayi yakapera gudhara. Dai efficiency yamuinayo pakuponda vanhu iriyo yamuinayo pakutonga nyika zvinhu zvingadai zvisina kumboshata so. Any way ndizvo zvega zvinongogonekwa neZANU PF zvekuponda kubva nguva yehondo. Chakabaya chikatyokera. Industry muri kure nayo musabatire zvinhu pamusoro, ende mauraya, kuwondonga chaiko. Goridhe rakapedzwa nasekuru vasinga dzorere ndosaka mubva ndiripo achiri farirawozve, akanzva kunaka kwaro.

  10. John Thomas says:

    The ZANU infestation had a desire to run the country and the Chinese gave them money and guns to take control. Unfortunately desire and ability are 2 very different things. Their reach has exceeded their grasp by several orders of magnitude. The president himself could not run a rural trading store yet he has the dictators power in the land. You can name them all one by one. Not one is a modern human being. They are all ghosts from the dark ages, steeped in superstition and witchcraft with only the most basic understanding of the age in which we live. One of the things they understand best is the application of terror. Another is scorched earth plunder. These are not nation builders, but rather hollow imitations of real human beings.

  11. Isu Zvedu says:

    There is only one mystery, if you ask me: Why many Zimbabweans fail to see evil and allow it to extend its tentacles to as far offshore as Singapore and Malaysia in the name of “illness of a cataract”. Why Zimbabweans fail to see evil in people like Gono, Kasukuwere, Jonathan Moyo, Chinamasa, Chihure? Why? The really puzzling mystery is why Zimbabweans wait to be led by someone to fight evil.

  12. E Maponga says:

    Zimbabweans are too docile to fight this corrupt state. Gono had fake degree, Bob also has fake ones and of course its only natural that Mangudya PhD is fake.

  13. kariba says:

    i now also wonder the credentials of war vets and those In high posts in various ministries -an audit please

  14. maita says:

    Kariba wall has collapsed kikikiki.

  15. Talouco2 says:

    I had the previlidge of have known the beautifull country that it is Zimbabwe I lived there when it was Rhodesia and when it became Zimbabwe I left zimbabwe in 1988 and I have lived since in the USA I’m 56years old and I was 14 when my parents immigrated to Mozambique ,the years i lived in A frica will be allways the best of my life I’m very lucky to still have friends that I call brothers and sisters since my childhood in Mozambique ,I was there two years ago to visit ,to get to the point I just wanted to ask what i can not understand is after colonial wars ,civil wars ,decades of strugles ,why is that the masses,the majority of the people that now should have been harvesting the fruit of such of a sacrifice ,,,why are this masses not strugling against the so call heroes of zanu-pf meaning the government, I dont know what the people are waiting for ,is it to mugabe to die? When that happen there will be another militar heroe to take is place ,slavery will continue,explotaction,political repression ,famine,corruption,opression,my beloved people of Zimbabwe get out on the streets ,protest ,ask for international help ,put a end to this reign of murders,greed looters ,do not just sit and hope that things will get better otherwhys one day will be too late and you might not even have hope,my love to you my brothers

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