In mid-May 2005, the police started demolishing what they described as "illegal structures" mostly in high density suburbs and informal settlements around Harare, the capital of Zimbabwe. The operation within no time spread like wildfire to other towns, growth points, service centres and some shops in the rural areas were also demolished in the process.
Initially no one was quite clear what the operation, now described as a "tsunami", was meant to achieve. The government alleged it was to rid Zimbabwean cities of illegal structures and combat the rising crime rate. The exercise continued, leaving families living rough during Zimbabwe's winter, from June to September where temperatures regularly drop to 5 degrees Celsius. Families were not even allowed to put up tents as these were also dubbed illegal structures by the authorities.
In July 2005 the United Nations Secretary General, Kofi Annan, sent special envoy Ms Anna Kajumulo Tibaijuka, the Executive Director of UN-Habitat as his Special Envoy for Human Settlement Issues to Zimbabwe to study the situation and compile a report detailing what was going on. Her report alleged that as many as 700,000 families were made homeless, a figure described as excessive by the Zimbabwean government.
In response to Ms Kajumulo Tibaijuka's findings, the Government changed the operation's name from "Restore Order" to "Live Well". Houses building began in some areas where people had once lived "illegally". Government spokespersons claimed that the illegal structures were been destroyed so as to improve the quality of available housing. The new homeless were asked to go back to their rural homes or to register to be allocated newly built housing and small shops. However, even though people were being registered and names of beneficiaries were appearing in newspapers, these were said to be mainly members of the police, army and state security. Ordinary people complained of being ignored, after having been promised housing and small shops. Everybody wondered why the new housing had not been built before the "illegal structures" were demolished.
In cooperation with the Inter-Regional Meeting of Bishop's of Southern Africa (IMBISA), Catholic Commission for Peace and Justice (CCJP), and Catholic Development Commission (CADEC National), JRS Zimbabwe decided to provide assistance to displaced families living in Epworth, 50 kilometres southeast of Harare. Many families had settled in this area after the war of independence in the 1970's. They had fled the violence and insecurity of rural Zimbabwe. After the war, these people never returned to their rural homes preferring to remain in Epworth.
Individuals were trained to collect data from those whose houses had been demolished. Information was gathered on family size, current residency and former residence, former occupation and type of assistance required. All those interviewed indicated a need of shelter, blankets and food. About 10% of the close to 4,000 people indicated their desire to return to their former rural residences and requested financial support to do so.
With assistance from the International Organisation for Migration and the Islamic Society, trucks were hired to move willing families to their rural homes and each family was given two blankets, mealie meal (corn based food) and cooking oil. Most of these families previously ran small commercial outlets. However, the authorities were by now arresting and fining anyone found trading with a permit while their merchandise were being confiscated. Although short term, i.e. June, July and August, the assistance went a long way in bringing relief to these people.
Many accepted that something needed to be done to improve the quality of housing in urban areas. Nevertheless, they were incensed that no warning was given before the demolition took place, despite the existence of a law requiring three months' notice be given. Now, five months after the beginning of the operation, families are still living rough and children have been born homeless. Many of these people say they have no rural homes to go to. Some who have gone to the rural areas are finding life there very hard, as it is difficult for them to get food. This year's harvest in Zimbabwe was very poor and many rural dwellers are need of food aid. In fact some of them have returned to the cities even though they have no homes there.
Those who are happy to remain rural areas at the very least will require seed packs so that they can grow their own food. The majority who have remained in urban areas still need shelter and assistance to start their own small businesses. Most are unable to pay their children's school fees which the Ministry of Education recently increased a thousand fold.
In response to their desperate plight JRS contacted the Epworth authorities to find out what plans they have provide shelter and assistance for the 15,000 who find themselves homeless. The authorities outlined its intention to build 100 houses for some of the homeless people. They also have plans to build 1,000 small shops and sell these to some of the affected people. However it was disheartening to be told that the authorities have only raised Z$200million, a little less than 6,700 Euro, for this purpose. It is also difficult to begin thinking of providing these people with means of starting income generating projects when they have nowhere to stay.
Zimbabwe and China will continue to strengthen the friendly bilateral relations that have existed since the birth of Zimbabwe, Deputy Foreign Affairs Minister Obert Matshalaga said on Thursday in Harare.
At the reception to mark the national day of China, the deputy minister said Zimbabwe noted with great satisfaction that the relations between the two friendly countries were deepening, strengthening and broadening as demonstrated by the recent visit to China by President Robert Mugabe and as evidenced by the increased level of cooperation politically and in key sectors of Zimbabwe's economy.
Matshalaga said Zimbabwe would look forward to the consolidation of these excellent relations and the exploration of more opportunities of cooperation for the mutual benefit of both countries and peoples in areas such as trade, technology transfer and investment.
Matshalaga added that the two countries enjoy profound ties that date back to the days of liberation struggle in Zimbabwe.
He said Zimbabweans would remember the enormous sacrifices that the Chinese government made during that important period in the history of Zimbabwe.
"We remain grateful for that timely material and moral assistance as we fought for independence and liberation," said Matshalaga.
VERY few events have such stunning emotional similarities as the burial of Henry Hamadziripi on Monday at Glen Forest Cemetery and the interment of Sheba Tavarwisa at a remote village in rural Gutu.
Both were icons of the Zimbabwe war for national independence. Coincidentally, both came from the same rural area and both were inexplicably denied national hero status although they deserved burial at the national Heroes’ Acre.
Both too were from the majority Karanga tribe.
Tavarwisa was the only woman ever to sit on the Zanu Dare Rechimurenga (War Council).
Hamadziripi took the credit of recruiting the late guerilla war General Josiah Magama Tongogara, Vice-President Simon Muzenda, and the country’s post-Independence Zimbabwe Defence Forces supremo Vitalis Zvinavashe into the liberation war.
For Mapiye Hwekete, burying Hamadziripi away from his comrades-in-arms entombed at Heroes’ Acre most probably evoked sad memories of his graveside eulogy at Tavarwisa’s burial some years ago when he asked the late Vice-President Muzenda: “What unforgivable crime did she commit not to be buried at Heroes’ Acre? And what criteria is used by the government to award national hero status among its pioneer war veterans?”
Mapiye’s remarks could best be answered by President Mugabe’s condolence message to the bereaved family.
It set pointers to the reason why the Zanu PF Politburo did not even bother to sit and deliberate on what status to award as it normally does when a request is made.
The timid request by the Masvingo provincial executive pleading for provincial status, particularly statements by Dzikamayi Mavhaire that Hamadziripi was not a card-carrying member, provides an insight into widely-held views that national hero status is an exclusive preserve of Zanu PF members.
And for the umpteenth time, Zimbabwe’s political mandarins have redefined all known interpretation of heroism, expediently forgetting that all protracted liberation struggles like the one Zimbabwe endured, generate powerful, yet potentially divisive political reactions.
Hamadziripi’s death has revived debate on what constitutes a national hero. It begs the question whether one’s past mistakes or blunders wipe out one’s sacrifices and achievements.
Were one’s past mistakes a major determinant of national hero status, then some of the politicians and Zanu PF stalwarts who were incarcerated in Mozambique for non-conformist views such as the current Police Commissioner, Augustine Chihuri, risk forfeiting prospects of burial at the shrine.
Hamadziripi and Tavarwisa join a long list of veteran nationalists that hail from Masvingo province like Fibion Shoniwa, Davies Mugabe, Michael Mawema, Samuel Munodawafa and others whose contribution towards national Independence has failed to jolt the conscience of the politburo.
If consistency is one of the tenets considered, veteran nationalists such as James Chikerema, Nathan Shamuyarira and clansmen stand to lose their places at the national shrine for forming Frolizi in 1971.
In sharp contrast to consistency as the criteria, George Nyandoro was buried at the national shrine.
Together with Chikerema, Nyandoro easily identified with the origins of the nationalist struggle in the 1950s but joined Bishop Abel Muzorewa’s Zimbabwe-Rhodesia regime.
Apparently, only the stay-the-course Zanu PF adherents stand to benefit.
Until the Unity Agreement, Lookout Masuku lay buried at Lady Stanley Cemetery despite the enormous popularity he enjoyed among Zipra cadres and the immense contribution he made, giving credence to public opinion that there is a discernible bias in the choice of heroes along ethnic lines.
Masuku’s status was posthumously re-classified.
Zimbabwe was a recipient of a Korean-built National Heroes’ Acre where heroes of the 16-year guerilla war for national Independence are buried.
And true to Norma Kriger’s observations about national monuments, these burial places have engendered vicious debate on who qualifies and who does not.
In The Politics of Creating National Heroes, Kriger says national monuments “expose the gap between political rhetoric of equity, participation and unity on the one hand and the realities of an enormous disparity between leaders and the masses (on the other).”
Instead of promoting national unity as President Mugabe has often exhorted mourners at the national shrine to do, the choice of heroes has tended to divide the nation over what criteria is employed to confer the honour.
A quick scan of the composition of heroes buried at the national shrine exposes ethnic disparities in the roll of national honours.
It took spirited protests from former Zapu members to get Albert Nxele, one of the pioneer guerrilla fighters, considered for national hero status. Some Zanu members did not even know who he was.
Political status-seeker Border Gezi, famed for inventing the notorious Green Bombers party militia, and Chenjerai Hunzvi who engineered the plunder of the War Victims’ Compensation Fund are eternally rested at the shrine ahead of founder leader of Zanu Ndabaningi Sithole and the first titular president in post-Independent Zimbabwe, the Reverend Canaan Banana.
If participation stands the dead in good stead for national hero status, Noel Mukono dedicated most of his life to the liberation struggle. At some point he was Zanla defence secretary. But apparently being a Manyika spoiled his credentials, as did his remaining a Zanu (Ndonga) member.
People of no known role other than nominated Cabinet ministers have found their places at the national shrine. People still question what role Chris Ushewokunze, Swithun Mombeshora, and Joseph Culverwell played in the liberation struggle to deserve national honours.
Perhaps surviving members of the Dare Rechimurenga, elected in 1973, will face an uphill task in getting their roles recognised.
In September of that year, the following were elected: Herbert Chitepo — chairman (Manyika); Mukudzei Mudzi — administrative secretary (Karanga); Noel Mukono — secretary for external affairs (Manyika); Kumbirai Kangai — secretary for labour, social services and welfare (Karanga); Rugare Gumbo — secretary for information and publicity (Karanga); John Mataure — political commissar (Manyika); Henry Hamadziripi — secretary for finance (Karanga); and Josiah Tongogara — chief of defence (Karanga).
Perhaps too, revelations contained in the Special International Commission on the Assassination of Herbert Wiltshire Chitepo report, commissioned by the Zambian government in 1976, that fingered Hamadziripi haunted him to his grave.
THE unfolding story of the collapse of the once mighty Zimbabwe United Passenger Company (Zupco) is a case study of how parastatals in Zimbabwe have been destroyed by graft. It illustrates how political appointees have run down parastatals by failing to comply with corporate governance principles.
The collapse of Zupco helps to explain why state companies have remained a burden on the treasury. Taxpayers' funds have been doled out to these parastatals whose bosses line their pockets.
Zupco was not brought down by lack of capital injection as widely claimed but by a combination of financial mismanagement and political appointees whose business ignorance was matched only by their venality.
Confidential audit reports that have been kept under wraps for the past two years show that there were no proper systems of either accounting or internal controls at Zupco.
The reports compiled by Kudenga & Co Chartered Accountants for the period 2002 to 2004 reveal that about six accounts with different banks were not recorded in Zupco's records and no bank reconciliations were prepared for these accounts. These accounts, as evidence shows, could have been used to siphon billions of dollars out of the company. The accounts could have been used to "embezzle" funds, says one of the documents seen by this newspaper.
Zupco's capital deficit deteriorated to $22 billion and it made a loss of $19 billion before tax in 2004 despite an injection of $42 billion by government.
Zupco made crippling losses during deputy Information minister Bright Matonga's reign as chief executive: $9,6 billion in 2002, $9,7 billion in 2003 and $19,3 billion in 2004.
The losses were made at a time when Zupco had increased its fleet for both rural and urban commuters through purchases of Volvo and Isuzu buses. Transport companies usually make profits when the fleet is still new as operating costs are low.
The reports unearthed a trial balance imbalance of $10,6 billion, which could not be explained by top management.
Too many accounts were maintained at the same branch. There seems to be no justification for the existence of some accounts. For instance, Zupco has two accounts at Barclays Bank Pearl House branch, three accounts at Metropolitan Bank Belgravia, two accounts at Standard Chartered Bank Africa Unity Square branch, and two Royal Bank Rusape accounts.
Zupco maintained bank accounts which were not supported by detailed cashbooks, the auditors said. Schedules which were prepared for some bank accounts had serious discrepancies which varied from $6 million to $200 million. No statements or reconciliations were prepared for creditors and invoices for creditors' payments could not be provided. There was no schedule of loans opening balances, additions or payments kept throughout 2002.
It was not known to whom the long-term interest-bearing loan of $43 567 929 and long term non-interest bearing loan of $92 188 207 were owed. There were no proper purchasing procedures leading to the payment of people who had not supplied anything to the company. For instance one of the reports notes that a payment of $64 million was made to a Mrs Majoni who had not supplied anything to the company.
Cash collections from bus income were not properly accounted for and there was no proper supervision of the work of junior staff. Many of the bank reconciliations had errors in them indicating that no senior person had checked them.
"The filing system of the company is very poor and a lot of documents which we needed for purposes of our audit could not be provided as they could not be found," Kudenga & Co revealed.
Stocks of uniforms, tyres and fuel had negative balances which management were unable to explain. There was no stock count at year-end and recording systems were poor.
No creditors reconciliations were available at the time of the 2004 audit. Receipted amounts could not be traced to the ledger because no posting sheets were prepared. Receipts were simply summed up and recorded directly in the ledger, the auditors said.
Employees' PAYE amounting to $64 million was not being remitted, for instance for the whole of 2002. This resulted in Zupco paying an extra $64 million and $30 million as penalty and interest respectively.
Matonga could not explain to the company's board the difference of $495 million between the ledger and the retrenchment package schedule and the auditors felt that payment might have been made to non-existent employees.
Zupco board minutes of August 20 last year said Matonga accepted full responsibility for the anomalies highlighted in the audit reports. The now deputy minister who was at the helm of the government-owned passenger transporter from June 2002 to late last year failed to control the company's finances as mismanagement took root.
He was forced to resign after his response to the damning audit reports was deemed not comprehensive enough by the board.
"From a general point of view the financial statements are adverse and do not portray a good picture of the organisation," the minutes said.
"The increase in revenue was well below inflation indicating a negative growth. In year 2003 the finance charges were higher than the core costs because the instrument used to finance the debt was inappropriate for the project."
Zupco's balance sheet was in a shambles the board noted. "There is therefore a negative shareholders balance of $10 billion. Both capital and profits are negative," it concluded.
THE Reserve Bank of Zimbabwe (RBZ) has failed to respond to an urgent appeal by the owners of Trust and Royal banks to make a decision on the unlawful takeover of their banks by the troubled Zimbabwe Allied Banking Group (ZABG), setting the stage for another legal battle.
Lawyers for Trust and Royal had written to the central bank on September 11, giving it up to Wednesday last week to stop ZABG from trading using the defunct banks' assets.
The Supreme Court in a ruling last month said the state had taken over the banks unlawfully.
Trust and Royal wanted the Reserve Bank to force ZABG to immediately stop trading using the assets and return them forthwith, in line with the Supreme Court ruling. The Supreme Court ruled that the transfer of Trust and Royal Bank's assets to ZABG was "null and void and of no force or effect".
The ruling means that if the assets are returned to their owners, it could suck the life out of ZABG whose shareholders may not have the capacity to pump in the trillions needed to prevent its imminent collapse. It would trigger a run on the bank, which would sink it.
The RBZ has however failed to respond to Trust and Royal's appeal forcing the lawyers of the two banks to prepare for a legal battle that is likely to start next week.
The legal dogfight whose papers were still being prepared yesterday is likely to suck in central bank governor Gideon Gono, ZABG and its directors.
Sources say the litigation would also involve Peter Bailey and Robert McIndoe, the curators of the two banks who actively participated in the transfer of the assets. It would also include the accounting firms of the curators and their partners in the business.
Sources say there are jitters in the ZABG board and management who are divided on how to extricate the bank from the crisis. A source said the ZABG board held an urgent meeting this week to deliberate on the impending danger of losing the assets.
The board, the source said, failed to agree, with some members insisting that they stop operating using the contentious assets until the matter was resolved. Other board members thought ZABG should wait for a decision from the central bank.
The source said the board sought Gono's opinion on the matter but the governor said ZABG should sort out its own problems.
A WAR veterans leader in Matabeleland has been hauled before the courts on criminal defamation charges after he wrote two letters to the Matabeleland North provincial magistrate alleging that judicial officials were biased against Zanu PF officials.
The Nkayi war veterans leader, Ezra Dube, was last week brought before Nkayi magistrate, Sikhumbuzo Nyathi, and was remanded out of custody to November 11.
The state prosecutor Sanders Sibanda told the court that on April 25 Dube wrote a letter to Matabeleland North provincial magistrate, John Masimba, alleging that officials at the Nkayi magistrates' courts were biased against Zanu PF officials in the district.
In the letter, Dube picked out the senior magistrate, Thabekhulu Dube, and Maxwell Hapanyengwi, the public prosecutor, as the officials who he claimed were always making biased decisions against Zanu PF supporters.
The state alleges that the contents of the letter were defamatory to Thabekhulu Dube and Hapanyengwi.
"The magistrate of Nkayi, T Dube, and prosecutor Hapanyengwi are harassing war veterans and accused persons," the letter written to Masimba says. "It is done in two ways: War veterans and Zanu PF members are denied bail each time they appear in court.
"This is done to punish them for being their political opponents; accused persons spend more than five hours outside the court waiting for their cases to be heard. The two honourable gentlemen will be conducting their own private business during that time and when they finally come more than half the accused are remanded in custody."
The letter further alleged that the two judicial officials boasted that they would leave Nkayi when all war veterans were behind bars and the MDC was in control.
The letter further alleged that the two are opposed to the government and should be "uprooted" from Nkayi and Matabeleland North.
This is not the first time that war veterans have threatened members of the judiciary. At the height of the land invasions, war veterans' leader Joseph Chinotimba stormed into Chief Justice Anthony Gubbay's office and threatened him.
Gubbay eventually resigned under pressure from government.
Some judicial officials have been physically attacked while others have been harassed and threatened in the course of executing their duties.
THE recent threat by Zimplats to withdraw its investment from this country over a tax battle with the Zimbabwe Revenue Authority (Zimra) is a classic example of how policy inconsistencies in government have driven away the little investment remaining in the country, analysts say.
It indicates how government has contributed significantly toward the economic meltdown by scaring away potential investors and frustrating those that are still operating in the country. The Zimplats case is emblematic of how mixed messages from government have hurt the economy by driving out investors. Ironically Zimplats is regularly held up as an example of Zimbabwe's success in attracting direct foreign investment.
Analysts say the fight between Zimra and Zimplats shows that despite its claims to being investor friendly, Zimbabwe has no clear investment policy to lure offshore businesses or support those that are already here. There are no clear regulations on tax holidays for investors who might be eager to sink billions of dollars into the country although informal assurances have been given by successive ministers of mines.
The Zimplats case shows the policy confusion and sends damaging signals to other investors who might have chosen Zimbabwe for their businesses.
Government had initially promised that investors would not be penalised for investing large sums of foreign currency in new projects in the country, especially in view of the long-term risks and payback periods associated with projects such as Hartley Platinum inherited by Zimplats.
In Zimplats' case there is a signed agreement giving the company a tax holiday. A “tax holiday” means that a company is exempted from paying tax for an agreed period. It is an incentive used worldwide to lure offshore investment. Other countries in the region like Botswana and South Africa have used this effectively to encourage foreign investment.
Zimplats had also been promised an exemption from withholding tax on dividends, thus effectively ensuring that the equity funding costs were not inflated to the point where investment became unviable. The investment agreement seemed to be clear in terms of the obligations of both parties. Under the agreement, government undertook to give effect to its obligations by way of amending legislation where necessary. This has not happened and Zimra has demanded that the company pays a whopping US$16,6 million in outstanding tax.
“As I am sure you will agree, this action runs contrary to the signed agreement, and to all the assurances given by your government to date,” said the company in its letter to the government last week. “The effect of the unspecified action to force the company to comply with Zimra's demands would be to shut down the operations since the costs would not be met.”
The company this week said they were not shutting down but the contentious issue had now been referred to the Attorney General's Office for analysis.
“This is not the case,” the company said about possible closure. “The private correspondence from Zimplats to Ministry of Mines and Mining Development merely points out the potential effect of the revenue collection authorities threatened actions to garnish operating bank accounts.”
Minister of Mines Amos Midzi this week said that despite the current problems pertaining to the Zimplats agreement government was still looking at the original agreement.
“This is a very clear case and there are no problems at all,” he said.
“What should only be done is to go to the original documentary history agreements that were agreed on,” said Midzi. “We are in the process of following up these agreements.”
Midzi said that the tax issue was in the process of being resolved with the line ministry which in this case is the Ministry of Finance.”
“We will be talking to the Ministry of Finance on the Zimra problems, but I cannot really say when we will have a solution. But it's something that is being addressed urgently.”
At best this illustrates how there is no handover process when ministers change ministries. Mining regulations have been changing with each minister.
Since 2000, more than 10 mines have closed shop due to viability problems but experts in the industry have noted that at least two of them could have been saved had it not been for bureaucratic bungling within the government line ministries.
The mining sector accounts for 4,3% of the country's gross domestic product.
In 2004, the costs of extracting platinum in Zimbabwe shot up by 55%, making it one of the most expensive countries in the world, a report released by London-based GFMS said in its Platinum and Palladium 2005 survey.
“Zimbabwe suffered the sharpest rise in production costs of US$135/ounce, or 55%, following the 2004 implementation of royalty fees on mineral production and exchange controls.”
Despite the high inputs costs within the mining sector as a whole, doing business in Zimbabwe is also considered a risky venture.
Besides the country being labelled as unsafe for business, others are concerned about the central bank's directive that platinum miners ought to open their foreign currency accounts locally instead of maintaining them offshore.
“The government through Zimra is flip-flopping on the policy issues,” a mining chief executive officer said.
“Are they now so desperate for hard cash that they are now reneging on the initial agreement they signed. What sort of signal are we sending to potential investors if rules can flip-flop just like that depending on which minister is in charge?”
The mining executive also raised concern on the lack of clarity on the 30% empowerment stake which is meant for locals.
“Initially, we were told a 50% stake had to be reserved for locals, but then we were told it was 30%. So which is which here? This makes planning very difficult.
“I am not really sure if it means an empowerment stake implies one has to be aligned to the ruling party or one has to come from Mashonaland West,” he said.
“We have had people who are either related to ministers or are from the ruling party bothering us that they have the money yet they all seem to have one major guarantor, which is government.”
In January the central bank introduced the Enhanced Platinum Sector Regime, which resulted in platinum being classified as a strategic mineral.
The directive caused anxiety among the platinum players in the country who were worried that they would not be able to access their money in time for inputs.
Under the arrangement platinum miners were ordered to open four special currency accounts with a local merchant bank which would in turn lodge the foreign currency in a “mirror” offshore Trust Foreign Currency Account (TFCA) for the exporter, held by the central bank.
This would result in the creation of a platinum collection foreign currency account to receive all inflows including export proceeds, loan draw downs or equity projections.
The TFCA would also have a debt service coverage to guarantee the ability of exporters to meet foreign loan repayment commitments of a minimum debt service cover ratio of two months as determined from existing outstanding offshore loans.
The new arrangement is considered too cumbersome for investors who want to have easy access to their FCAs to enable them to import equipment.
Of concern also is that instead of encouraging investment, what is boldly clear are stringent rules when one wants to pull out of their operations in the country.
Since January, investors that wish to pull out of the country will only get their remittances paid over a 20-year period, a major policy switch from the original 72 months.
By Eric Bloch
FOR many years, almost ad nauseum , government has pledged to wage a vigorous war against inflation. In practice however, it has only resorted to a very few — and extremely minor — skirmishes against inflation, and intermittently sought to quell the exceptionally virile black market, even launching the justly internationally-condemned Operation Murambatsvina, but to virtually no avail.
Whatsoever few endeavours were made to curb the pronounced black marketeering proved that the only effective way of ending black market operations is to ensure that there is a sufficiency of required commodities (be they foodstuffs, petroleum products, foreign currencies or otherwise).
Naught else will close down black markets. Any other strategies merely drive the black market deeper underground, with commensurate price increases.
The only other substantive measure applied by government has been recurrent, totally counterproductive, impositions of price controls.
Contrary to the stated objective of curbing inflation, the results of price controls have been diametrically opposite. Price controls rendered production and marketing of many products non-viable, with consequential immense shortages, opening doors wide for black marketeers to trade at extortionate prices in such limited quantities of the scarce products as could be sourced.
In contrast to government's endless, baseless and unfulfilled promises to end inflation, the only real drive against ever-soaring prices was that of the Reserve Bank of Zimbabwe (RBZ), which resorted to stringent exchange and interest rate management, thereby bringing inflation down from its all-time high of 623,8% (year-on-year) in January, 2004 to 123,5% in April.
But this was achieved at great cost to exporters, whose operational viability was destroyed by the disparity in exchange rate movement against rising operational costs. Ultimately, it became impossible to hold down the exchange rates without causing an almost total collapse of the export sector, whereafter inflation surged upwards once more.
In practice, inflation can only be brought under control if there is collaboration between government, the RBZ, the private sector and labour.
But, first and foremost, government must genuinely wish to wage war on inflation to such an extent that it is prepared to subjugate most other political aspirations to that key objective. It needs to formulate substantive strategies instead of spurious ones, and to implement them with determination, irrespective of any negative repercussions upon its self-interests and those of the individuals that constitute government, or its influential supporters.
The first measure should be a genuine and very marked reduction in government spending. As admirable as are the intents of the Minister of Finance, Dr Herbert Murerwa, to bring about a reduction in the size of the presently over-blown public service, and to fund new ministries from unexpected votes of existing ministries, that does not suffice.
Government needs to reduce the number of ministries which exceed those of most developed and enriched countries. Those are posts which Zimbabwe cannot afford!
In like manner, a government which genuinely wishes to be responsible, which wishes to place the populace ahead of itself, which is determined to cut expenditures instead of increase them, would place the establishment of a Senate on the back-burner until Zimbabwe can afford it.
Further meaningful cuts could be achieved by effecting a marked reduction of the defence forces.
Why does a country at peace with its neighbours require many thousands of soldiers, squadrons of jet fighters, military bases proliferating the country, and a vast wealth of ordnance. Similarly, Zimbabwe does not need the plethora of diplomatic missions that it has around the world at unaffordable expense. Certainly, very few of its embassies are achieving any enhancement of Zimbabwe's abysmal image internationally.
The next key action required in the war against inflation is a genuine assault upon corruption.
It is all very well that Zimbabwe now has a Ministry of Anti-Corruption and a very recently established Anti-Corruption Commission but, with very rare exception, Zimbabwe has turned a blind-eye to almost all corruption for more than 25 years.
A rare and very commendable exception has been the recent prosecutions of more than 40 Zimra officials. Those prosecutions are particularly notable because of the rarity of real endeavours to do anything to diminish the intense corruption that characterises both the public and private sectors of Zimbabwe.
Costs of corruption have to be recovered, and therefore are very major contributants to inflation.
The third, vitally necessary stratagem to bring inflation under control must be to increase productivity nationwide — in the country's parastatals, throughout commerce and industry, agriculture and in every other economic sector.
The greater the volumes of production without prejudice to quality, the lesser the unit costs and the consequential lowering of inflation.
Attaining greater productivity requires collaboration between government and the producers. Within parastatals, government must cease talking about privatisation and joint ventures with private sector strategic partners, and must turn its talk into realities.
It must capitalise parastatals adequately so that their ongoing costs do not continue to be swollen by unsustainable debt service. Unnecessary personnel must be weeded out whilst other personnel must be incentivised with market-related, productivity-based remuneration.
Programmes of land acquisition, resettlement and redistribution must be restructured to ensure a real, lasting agricultural recovery.
Industry, mining and all others must be facilitated and incentivised to achieve maximum productivity.
Hand-in-hand with the productivity, competition in commerce and industry must be encouraged, for competition motivates efficiency enhancement and profit-reduction (per unit sold), with resultant favourable impacts upon inflation.
The greater the competition, the more each is motivated to curb costs in order to retain and gain patronage without prejudice to profits.
A key element to bring inflation control is to achieve exchange rate stability, as was recognised by RBZ. But that stability must be achieved without prejudice to exporters, and the only way to bring about stable exchange rates (other than by regulation and its concomitant negative consequences), is to ensure that there is a sufficiency of foreign exchange to meet demand.
In the long-term that is best attained by substantial export growth and Foreign Direct Investment (FDI), concurrently with realistic endeavours at import-substitution.
In the medium-term, international balance of payments support is essential, but will only be forthcoming when Zimbabwe has reconciled with the international community. That requires massive transformation, including genuine espousal of democracy and compliance with its tenets, real re-establishment and maintenance of law and order, unqualified respect for human rights, irrefutably free-and-fair elections, establishment of an investment conducive environment together with forthright actions of conciliation.
Clearly there are many other necessary strategies for a successful war on inflation, but unless the war campaign includes draconian cuts in state expenditure, unequivocal resolve to contain corruption, determined pursuit of productivity and competition, and constructive measures to achieve exchange rate stability, the war will continue to be lost.
A SHOWDOWN is looming between council officials and the Harare Municipal Workers Union over salary negotiations, with the union demanding a minimum wage of $6,1 million for its members.
Negotiations have reached a deadlock with the cash-short local authority arguing that it cannot afford the increase demanded while the union says its workers are failing to make ends meet owing to escalating costs of basic commodities and increases in transport fares.
"We are deadlocked but we hope the stalemate will not force workers to go on strike and inconvenience ratepayers," chairman of the union, Cosmas Bungu, said on Wednesday.
Municipal work is considered an essential service and employees are barred from work boycotts.
Bungu said a number of municipal workers were losing their household property to money lenders due to low salaries in the midst of escalating costs for basic commodities and food.
"People are hungry and have to borrow to make ends meet. They become so indebted after borrowing for food, school fees and bus fares that money lenders haunt them everyday," the union chief said.
He said his union had agreed with the employer to take the matter up with the arbitration centre for a determination. The meeting is scheduled for Monday.
The showdown between Harare city council and municipal workers comes at a time when the commission running the city is looking for US$27 000 ($702 million) for a trip by commission chair, Sekesai Makwavarara, to Moscow.
Makwavarara's costly junket is planned when the city has almost run dry of fuel for trucks to remove mounting garbage from the streets. Council cannot attend to burst water pipes. Neither can it provide adequate water supplies to residents forcing some suburbs to forego water supplies for weeks
Movement for Democratic Change MP for Harare North, Trudy Stevenson, advised the mayor of Moscow, Juri Michailowitsch Luschkow, not to entertain Makwavarara saying her delegation does not have the mandate of the city residents. - Staff Writer.
THE lawyer representing losing MDC Gweru rural candidate, Renson Gasela, in his electoral petition last week quashed attempts by the defence lawyer to introduce, during cross examination, a letter that was not on the original opposing papers.
The letter states that the Zanu PF candidate in the area, Josphat Madubeko, resigned his traditional duties before the 2005 parliamentary election.
Gasela's lawyer Nicholas Mathonsi told Justice Maphios Cheda, the presiding Electoral Court judge in the case, that it was unprocedural for the defence to introduce during cross-examination documents that were not in the original opposing papers.
Martin Makonese of Makonese & Partners, representing Madubeko, had quizzed Gasela on his knowledge of a letter written by the traditional chief for the area confirming that Madubeko had relinquished his duties as Headman Sadza.
Gasela alleged that the letter in question was a post facto letter written by the chief to suit the situation. Gasela alleged that the fact that the letter was addressed "to whomsoever it may concern" indicated that it was not directed at the issue in question.
Gasela further claimed that the letter, copied to the District Administrator and the Ministry of Local Government, was not authentic and alleged that if it was then Madubeko would have attached it to his original nomination papers to show that he had indeed relinquished his traditional post.
By David Mutambara
THERE is a raging debate in the media about issues of corporate governance such as influence peddling, conflict of interest, corruption, and too much regulation breeding corruption and black or white managers as a front. This debate is real.
Influence peddling occurs when a powerful member of society exerts political pressure for favours to be advanced to other parties. This is usually on the basis of "who you know" rather than "what you know". Sometimes this involves the use of membership to the same church, party or any such grouping to gain financial and other favours for your business.
I have no doubt in my mind that I am not necessarily saying one cannot perform work for your political party or church. No, not at all. What I am saying is that if this is done, this should be above board.
There is need for clear policies and regulations of this practice. A director of a company, if he is to perform private work for the organisation that he sits on the board, should do so with a clear understanding of the risks involved.
Will the rest of the stakeholders not raise eyebrows when murky details emerge? In the absence of the guidelines and policies regulating such conduct, usually the details emerge from staff and other embittered tender losers. It is usually embellished.
Sometimes the exercise of influence peddling could be a lot subtler.
Powerful people in government and private sector employ their spouses and relatives to run their private businesses, which in turn purport to provide goods and services to the same organisation where their more powerful relatives are employed.
We should not be too hasty to say it is wrong, but in the absence of good governance systems and regulations, this is subject to interpretation in widely different ways by staff and the wider community. The company then runs the risk of being interpreted as practising poor corporate governance.
If staff can buy products at a discounted price this must be clearly stated in policy. If politicians can access the same products at a discount, then why not just state this and let every one know of this position, preferably in print?
For a CEO or senior manager to help himself to the "waste material" every other week, helps himself to company trucks to attend his numerous funerals every week, then he is guilty of influence peddling and abuse of authority.
What will happen is that staff members will also begin to agitate for the same favours, week after week. The same CEO will be forced to give in to some staff demands and to refuse some other demands. This can then create a vicious circle of staff conflict and poor industrial relations in the company.
Organisations get around this by asking their potential and current directors to come clean and declare their assets before they join the board.
Sometimes they are asked to recuse themselves in discussions concerning companies they have interests in, such as a shareholding interest.
The truth is that directors will sometimes conceal this conflict of interest. After all, revealing that you know the director of that bidder, who happens to be your wife or brother in financial distress, might mean loss of the tender.
Hence unscrupulous directors keep mum over their conflict of interest.
Some amongst us will view this as idealistic viewpoints that have no place in this cutthroat, dog- eat-dog society we live in. Everybody is doing it. Why not me?
But this is the cancer that eats into our society, if it goes unchecked. There will probably be no individual that will be able to remain squeaky clean in this environment. I know that.
Hence it is precisely for this reason that there is need for proper policies and regulations to help mankind manage their inclinations towards being dirty and unscrupulous. Corruption cannot be eliminated, but can be contained with proper checks and balances. But then again, too much regulation usually breeds petty officials and hence corruption.
* For comments and feedback, please email or phone Edwin Kondo email@example.com or 301985/8. An incisive look at the two evils
Zesa Holdings an unnecessary burden
The North Korean 'crisis' that never was
Hamadziripi snubbed but no less hero
Influence peddling real
By Rejoice Ngwenya
THE jury is back and its verdict - Ian Douglas Smith was "better than" Robert Gabriel Mugabe - has been grudgingly embraced.
At face value, it seems naively cruel that a man who caused untold misery, displacement and death can be associated with a whiff of sentimental attachment.
I mean this man, Smith, was vicious. Once he set his Rhodesian Ridgebacks on you, boy, the human animals would not let go until you dangled at zero gravity, waist-deep in a pool of blood.
Those homo sapiens canines would spurt racial poison into your system until your body and soul went numb and lifeless, dehydrated with emotion. Their ultimate context of "victory" would be to attach a "kaffir" label on your big left toe before you were exiled into a cold room of political isolation.
That is how I perceived Smith. I suppose President Mugabe and his comrades-in-arms share the same chilling memories.
And yet most reasonably objective Zimbabweans now insist that amidst the whirlpool of racial humiliation, political bigotry and ideological dogma characteristic of Rhodesian life, Smith exhibited a semblance of organisational sanity even in the face of local and international adversity.
The Rhodesian system of governance, in retrospect, prevailed over crippling sanctions and global isolation. Faced with the same scenario, Mugabe's mode of governance has crumbled, as Jimi Hendrix put it, "like a castle made of sand".
Whereas the irony is that in the midst of real economic and infrastructural sabotage - destruction of bridges, fuel depots, railway lines and the downing of Viscounts - the Smith juggernaut remained functional.
I cannot say the same of Mugabe's imaginary context of sabotage in the form of devaluation and legitimate political opposition - child's play compared to the thunder and smoke that the Zipra and Zanla forces inflicted on the Rhodesian infrastructure.
Even then, it was in the sixties and seventies that Rhodesia continued to produce the best in teachers, nurses, railway men, farmers, and businessmen.
Hospitals, clinics, dip tanks, colleges, councils and supermarkets never ran out of provisions. If you had petrol coupons, you would actually get petrol - even in local currency.
If you decided to study, you would walk into any bookshop or library and got all the textbooks required. Try visiting council libraries today!
The Rhodesian dollar was just a delight, sustaining large families up to the "32nd day" of each month. But for all the good works that Mugabe and his late comrade-in-arms Joshua Mqabuko Nkomo are credited with, their noble intentions seem to be a stale (not pale) shadow in the face of the harsh realities confronting modern-day Zimbabwe.
In all the conceivable departments that have a cumulative context of "governance", Smith does seem, after all, to have had a slight edge.
I do not want to bore you with comparative chronicles of his excesses, but I will certainly raise teasers as future reference for debates in commuter omni-buses, bars, churches, colleges and parks.
As my queue friends always say: "Taiti zvichaoma, asi izvi hatina kana kumbozvifungira (We thought life was going to be tough, but not to this extent)."
Therefore, my interpretation of the statement "Smith was better than Mugabe" will be based on what can be rhetorically termed "access to good living".
Now I know that Rhodesia's racial deprivation, compared to Zimbabwe's starvation, long queues, homelessness and a suffocating cost of living, is like child's play.
Millions of angry Zimbabweans in urban and rural areas would actually like to shout: "Smith anga arinani zvake! (Smith was a lot better)" but fear for their miserable lives.
I am merely a mouthpiece, and in our African tradition, you do not shoot the messenger, the difference being some messengers have a bit of a brain, which means they have a capacity to fight back when needlessly provoked.
As they say in civilised countries; do be a sport, dear, and accept your weaknesses.
Of course you may accuse the Rhodesian sentimentalists of having a short memory. Don't politicians have that problem too?
I suppose you do remember guys like Dumiso Dabengwa and John Nkomo who were humiliated and slandered by Zanu PF in the 80's. Some of their colleagues like Lookout Masuku and Major Grey perished in prison after the liberation struggle, but on which side of the fence are their surviving colleagues now?
On the side that provides the most crisp, shiny bearer's cheques!
I was in Zimbabwe when 20 000 amaNdebele were annihilated - not by Smith - but by the Zanu PF-inspired, North Korean-trained Gukurahundi. So don't you ever, ever lecture me on short memories!
The facts are there for all to see and as you read, draw your own subjective conclusions without assigning any specific viewpoint to the author.
In Rhodesia, opposition politics was "constitutionally" banned, which means you could not talk freely about Zapu and Zanu without attracting the wrath of the law.
There was no comparative debate on political ideology either on television or radio, and besides, the government had the upper hand in abusing the state machinery to fulfil its mandate of suppressing public opinion.
Public political meetings were a no-go area and the British South Africa Police (BSAP) had the right to displace, violently, any "unauthorised" gatherings. And yet it is in that very Rhodesia that Zanu PF blossomed into one of the strongest political forces in the region, with tactical and logistical support from Zambia, Botswana, Tanzania and Mozambique.
All the while, we continued to go to school both at home and overseas without visas.
You could walk into any bank and buy foreign currency without having to produce your grandfather's first payslip! And the social life . damn!
I fondly remember the lush green football fields of Nguboyenja when we used to spend weekends watching "Bafa" soccer and then "sink" the day at the nearby Happy Valley.
Those were the moments of glory of Eye of Liberty, Gipsy Caravan, and Wells Fargo. and pretty student nurses from Mpilo Hospital.
Back then, the Zephyr 6, Alfa Romeo and BMW Cheetahs ruled the roost.
Super models like Philip Zwambila and Stephen Campion would contest for the best girls at BG Hall with sporting heroes like Tymon Mabaleka, Majuta Mpofu and boxer Ringo Starr while we, mere mortals, lustfully gazed in awe.
If you were bored with pub copyrights, you would while up time and listen to Luke Mkandla on Radio Mthwakazi or slide the dial to RBC's Jay-Cee-Jay show, if not "LM radio, just for music".
Back then, you were nothing if you didn't boast of a flared "Revolution" trousers and platform Roberto shoes. We used to term the combination "mother don't sweep!"
If you could not recite a few lines of Doobie Grey and Jimi Cliff's music, which woman would want to accompany you to Bulawayo Service Station?
The Afro hairstyle was ugh! talk of the town. Our heroes from yonder - Lionel Peterson, Percy Sledge, Jimi Hendrix et al - left a legacy of psychedelic dress code that sent shivers down the spine of our ultra conservative Christian parents.
Earlier in life kwaNhema, I remember big boys like political activists Patrick Mandikate and McClay Kanyangarara from the "immortal" Fletcher High School setting the trend in true "Beatle-speak" - a type of English that appeared only inside sleeve jackets of vinyl records from overseas.
The Beatles, Elton John and the Kiki Dee Band; Black Sabbath, Grand Funk Railroad, Deep Purple, Nazareth, Queen and Bob Geldof and his Boomtown Rats were the real "mark of the beast".
For me, the sweet Motown soul of the Jackson Five, Diana Ross, Temptations, Gladys Knight and the other heroes of Afro-American beat is an irreplaceable part of my Rhodesian life.
Now you tell me, can Mugabe's Zimbabwe offer me that type of life in exchange for my vote in 1980? Judge for yourself.
* Rejoice Ngwenya is a Harare-based writer.
By Vincent Kahiya
LAST week I asked in this column if there was anything called deliberate inefficiency. There is. The Zimbabwe Independent and its sister paper the Standard have become victims of this constructive inefficiency - when state apparatus deliberately function in a confused manner to thwart companies from doing business.
We have watched in awe as bureaucrats perform their discordant tune.
They have made awkward decisions, reversed them, appeared to be understanding and then fallen into fits of confusion again, in the end making no real decision. We are now where we were in March. These guys are perfectionists in this art. As Shakespeare would say, they are "wise enough to play the fool".
This Comedy of Errors stars the Zimbabwe Revenue Authority (Zimra), a body whose mission statement claims the tax collector's job is "to facilitate economic development, trade and travel, revenue generation and collection, to enforce regulatory controls with integrity, transparency and fairness".Before reverting to the issue of "integrity, transparency and fairness", let me introduce the other main character - the Office of the President.
In another story in this edition we highlight our six-month ordeal to get a Reuters satellite dish and ancillary equipment installed at our office. This is basic equipment installed by the news agency to enable it to sell news, pictures and graphics to media houses. These are the stories we run on our international pages. All mainstream media in Zimbabwe have this facility together with financial institutions and other large corporates.
We have had this equipment since 1996 and last year Reuters informed us that it was upgrading, hence we were getting new equipment. But constructive inefficiency was rolled onto the scene to ensure the equipment did not get to us.
When the goods were seized our information was that the CIO had issued the instruction. A receipt of goods seized from Zimra however said the goods had been held pending issuance of a licence by Tel*One.
My foot! I queried this with a Zimra officer at Beitbridge who admitted they had made a mistake. No apology was given. Remember "integrity, transparency and fairness"? Tel*One is not in the business of issuing licences to news terminals.
The authorities in August then came up with another excuse. This time we were referred to the Broadcasting Authority of Zimbabwe where Herald Editor Pikirayi Deketeke is acting chair.
We duly wrote to them explaining our fate. BAZ rightly wrote to Zimra to say they do not deal with those issues. I am sure Pikirayi was surprised by our request for a licence since (I bet my bottom dollar) this has never arisen with regard to similar equipment in his newsroom.
Do I remember Zimra boss Gershem Pasi talking of diligence not so long ago?
Then our hopes were raised. We thought we had got past another bureaucratic hurdle. Zimra officials got in touch with the clearing agent who was handling the shipment to pay for demurrage and collect the goods. The amount of $22 million was paid and all that was left was to collect the equipment from Beitbridge. I expected the equipment to be installed last weekend but had not counted on further deliberate inefficiency from the system.
Zimra had suddenly realised after six months that it had experts who could examine the equipment to determine if it required licensing. All along we were hearing reports of the CIO issuing orders that the equipment must not be released.
Last week the Zimra experts were suddenly scrambled and their ruling was that we should now apply for a licence from the Post and Telecommunications Regulatory Authority (Potraz).
But we had been to Potraz before. In March correspondence was sent to Portraz seeking assistance to have the equipment released. Potraz in April wrote to Zimra to release the equipment into their custody to enable them to carry out examination to determine if a licence should be issued. The equipment was never released to Potraz.
Potraz is now back in the picture but the catch is that a copy of the application should be copied to the Office of the President, an undisguised admission by Zimra as to who controls the levers.
If the policy is going to be applied consistently, everyone who has that equipment, and is not licensed, has to switch it off and apply for a licence from Potraz. This is a new role for Potraz which we have not heard about before.
The application is being prepared and a copy will be handed over to the President's Office where the final decision is likely to be made. But there is now no guarantee that the application will result in us getting the equipment.
Firstly, we were told to go to Tel*One, then Potraz and BAZ and now back to Potraz. What can stop the authorities from further complicating the issue by bringing the Media and Information Commission, for example, into the mangle?
I know we are not the only victims of calculated confusion of this sort. Large corporates and investors wanting to do business in Zimbabwe are given this kind of run-around. Last week we reported threats by platinum miner Zimplats to cease operations over a tax dispute - a product of state blundering.
The interest of the Office of the President in this issue is not surprising given the anti-business and anti-media attitude of those around President Mugabe who feed on all sorts of silly conspiracy theories. At first they thought our satellite dish was for transmitting! But can Zimra come clean and tell us that the issue of the seized equipment is beyond its control.
Integrity, transparency and fairness. Big words indeed but like so many other mission statements - meaningless. Calculated confusion