send any material for publication in the Open Letter Forum to email@example.com with "For Open Letter
Forum" in the subject
261 --------------------------------------------------------------------------- THOUGHT
FOR THE DAY "For success, attitude is equally as important as
--- Harry F.
LETTER FORUM Letter 1. Subject Sense of Humour
intriguing and spectacular display by Zimbabwe's fiscal system is extremely
difficult to explain to citizens in the first world. But as usual a
Zimbabwean living there can sum it up with great humour so that many of us
abroad can laugh and cry in a very knowing manner. I shall not give the name
of the author just in case it causes him to be liable for a "midnight knock"
from the CIO; I am sensitive to that.
"Since the appointment of a new
Governor of the Reserve Bank some four months ago we have seen 5 financial
institutions closed down (and many people left without access to their money
as a result) and interest rates fluctuating between 1 000% and 0%. You think
I am kidding? Just in this last week my meager investments went from from
200% to 30% with no indication of what will happen next! The only thing that
is reasonably constant is the fall of the Zimbabwean dollar - now at about 8
500;1 to the British pound.
Two cups of coffee with 1 slice of cake
cost more than our first house 30 years ago. How about our time share
annual levy which was $10 000 - 4 years ago - and now is $1 000 000. It
takes a lot of effort just to stand still in Zimbabwe. Inflation is
as frightening as ever!" - Zimbabwean resident, 26.04.2004.
I am not
sure that the CEO of Zimbabwe, or his Financial Lieutenants on His Board
would qualify for jobs in the first world. It would be difficult to give a
recommendation for the Governor of the Reserve Bank because he took on the
job in full knowledge that an economy can only run on Security of Tenure. He
even bought and paid for his own farm rather than just join the gravy train
and take a farm. Surely he must have full comprehension of the absolutely
imperative aspect of Title in an economy if he took the care to actually take
his money to buy his Title? What now Mr. Reserve Bank Governor, what shall I
tell the World?
The basis of the Quinnel Case is the attack on Title
which the Third Chimurenga has been all about.
Abroad. --------------------------------------------------------------------------- Letter
2. Subject PR Communique - 23 April Dear JAG Please thank Eddie Cross -
good to be reminded that nature is more powerful than the evil that men do
and our Zimbabwe will still be here when the dictator and his cronies are no
more. Just hope that my generation is still here to see it.
Brown --------------------------------------------------------------------------- Letter
3. Subject Power & Money - Not Land Dear Jag,
The lengthy report
on land redistribution problems in Southern Africa published by the
International Crisis Group is a highly comprehensive document which has
identified the politicization of the whole exercise by Zanu with outstanding
clarity. The authors are to be commended for their literary achievement of
documenting the Third Chimurenga.
However, at the end of the report, the
authors start to look at possible solutions. Some of the highly theoretical
and academic hypotheses put forward are a cause for enormous concern. That
such such theories should be published by such a highly respected
international organisation is in itself a major concern.
quote: "Zimbabwe's white farming population is an aging one.... While some
commercial farmer groups insist that up to 60-80% of their members would
return to farm on property if it was returned, these estimates seem very
high. A realistic estimate is that maybe 30% of former farmers would
actually return if the political and economic climate stabilised. In
general, there should be a pattern of A 1 distributions around
larger existing commercial farms."
1. "Zimbabwe's white farming
population is an aging one.."
Trends in the first world generally show
"aging populations:" - (the Australian Government is trying to encourage
larger families because of a declining birth rate and an aging population -
forty years ago there were 3,5 children per family and now there are only
* Does this not perhaps mean that the white farming population was
in line with the first world trends? - whilst the general trend nationally
was the reverse - half the population under the age of 16?
Personally I can think of many farmers who ran highly sophisticated farming
operations with managerial structures, and the staff were paid bonuses on
productivity - a first world managerial style that encourages productivity
*In Australia it is against the law to discriminate
against people on age - an organisation like the International Crisis Group
should know better! - My mother has just got married at the age of eighty -
what is wrong with that? What right has anybody (including the Crisis
Coalition) to say she is too old? Everybody is aging - everybody alive today
is older than they were yesterday. Simple!
*I can think of other
people who are also eighty, and supposedly well educated, who should know
more about human rights and an independent judiciary based on their
education. They are also aging, like the white farming population and the
rest of the world.
2. "A realistic estimate is that maybe 30% of former
farmers would actually return.."
* How many farmers choose to return
to their properties should not be part of the equation.
*The issue at
stake is security of tenure - not the colour of the Joe Soap.
is rule of law, human rights and property rights there will be security of
*Once these are in place, land will again have value and the
economy can grow, and create wealth and stability for its
*The higher the % of returning citizens (of all colours) the
greater the chance the country has of developing because the rest of the
world will say that Zimbabwe is a true democracy, and hopefully foreigners
will visit it to play cricket amongst other things.
3. "There should
be a pattern of A 1 distributions around larger existing commercial
In Australia there are commercial arable farms of thousands of
acres - 3 000 acres is common and will be operated by two people. Efficiency
and economies of scale dictate that these farmers are fully subscribed on
that operation. When they make a profit they pay tax - lots of tax - and this
is used to uphold the law and educate people into the professions of
their choice. Potential young farmers - of any age, colour or gender can work
on these farms for the harvest or other busy periods for a decent wage,
and then go back to college to study.
*I believe it to be a tall ask
to expect the returning commercial farmer to resort to an antiquated
paternalistic role in the community. A number of the farmers that have had
the most problems during the Third Chimurenga are the very farmers who built
good business relationships in the community - Roy Bennet is a good example,
and the late Martin Olds, Alan Dunne and Charles Anderson are good examples
of the lengths that Zanu would go to get rid of such community minded people
that might challenge their absolute power fixation.
* Agriculture must
now become a professional business throughout the entire land - Joshua Nkomo
realised that the problem was lack of Title in the then TTLs and now Communal
Lands. Chibero, Gwebi, Esigodini, Mlezu, ART Farm, Trelawney, Blackfordby and
the likes will have to form the backbone of agricultural training. The
commercial farms - and there are very few now - will then be the practical
The problems in Zimbabwe over human rights, property
rights, racial matters, land and rule of law stem from two factors. Now there
is a perceived problem about the racial balance in cricket - the two
factors have the same common denominators. They are simply POWER & MONEY
for a selected few.
4. Imagine Zimbabwe as a listed Company. Rate it
on a scale of 1 to 10.
*In purely business terms how will the CEO of
Zimbabwe Ltd., and its Board, rate against Microsoft or General
*How well are the 11,5 million shareholders doing?
well is the agricultural component of Zimbabwe Ltd. performing?
the Cricket component performing?
*How good is it at keeping key
*How is its International Image faring?
*What was their
score out of 60?
Consistent underperformance generally results in
bankruptcy or judicial management, followed by a new broom on the
The question is when? Dark Joe
letters published on the open Letter Forum are the views and opinions of the
submitters, and do not represent the official viewpoint of Justice for
Suspension used to force England to tour Thu 29 April, 2004
LONDON (Reuters) - The threat of suspension from
international cricket was a last-minute change to the sport's regulations put
in to force England to tour Zimbabwe, England and Wales Cricket Board chief
executive Tim Lamb has been quoted as saying.
Cricket Council (ICC) said last month it would suspend any country refusing
to fulfil its tour obligations for anything other than security reasons and
would also levy a $2 million (1.1 million pound) fine.
Lamb was quoted as
saying the decision to introduce the sanctions as changes to ICC regulations
was taken at the last minute before an ICC board meeting in New Zealand in
"I think certain members of the ICC, who...were concerned about
England not completing the tour (to Zimbabwe), discussed what could be done
and saw a change in regulations as rather an elegant way of putting pressure
on England," Lamb was quoted as saying in Thursday's Guardian.
said a meeting of ICC chief executives in Dhaka, Bangladesh, in February had
approved tabling a motion at the meeting in Auckland that would ensure
countries fulfilled their tour obligations.
The motion did not mention
changing the regulations to include the penalties of suspension and fines,
and this was raised only one day before the board meeting, he
"It was not until 11th-hour discussion on the eve of the meeting
itself that it was proposed as a change to the regulations," said
"The ICC president and chief executive had no idea on the eve of
the meeting it was going to happen."
The ECB has been embroiled in a
political battle over whether to tour Zimbabwe, after the British government
said it has serious concerns about the human rights record of President
Robert Mugabe's government.
The ICC accepts that a country can cancel a
tour if directly ordered to do so by its government, but the British
government, despite its concerns about Zimbabwe, has said it is leaving a
final decision to the ECB.
Des Wilson, chairman of the ECB's Corporate
Affairs and Marketing Advisory Committee, resigned on Tuesday over the
Zimbabwe tour and the ICC's new penalties.
In his resignation letter
Wilson accused the ICC of imposing "draconian and disproportionate" penalties
on countries which refused to tour other nations for moral reasons.
said the ECB should tour only under protest while seeking "to change
the protocol so that no other country can be coerced in this
Also on Thursday, the Daily Telegraph said Australia had been the
principal driving force in ensuring the sanctions became part of the ICC
If suspension had not become part of the regulations, any
decision not to tour would have been referred to a disputes committee and the
most severe punishment would have been a fine, the newspaper
"However at Australia's insistence, it was made a regulation and
this gives the ICC the power to suspend England for a year, which would mean
no Ashes tour next year and such heavy losses the English game would be
bankrupted," the newspaper said.
Government offer get-out on Zimbabwe By Mihir
Bose (Filed: 29/04/2004)
The Government are considering a
series of measures to help England's cricket team avoid touring Zimbabwe,
including holding a debate in Parliament.
Jack Straw, the Foreign
Secretary, told an all-party group of MPs that while the Government could not
instruct the England and Wales Cricket Board to pull out of the tour, they
were prepared to do anything short of that to help the ECB convince the
International Cricket Council that the tour could not go ahead because of
force majeure. The ECB would then avoid the possibility of being suspended
from international cricket, and consequently losing revenue estimated at £50
Straw is prepared to allow a debate in both houses of Parliament
and MPs would be given a free vote on the issue of whether England should
tour Zimbabwe this autumn. While not amounting to a direct ban by the
Government, a vote against the tour would carry great weight.
have been looking for several months for an argument to present to the ICC
saying that a case of force majeure - an unexpected and uncontrollable event
- had made it impossible for England to fulfil their obligation to
When the ICC board met in Auckland early last month David Morgan,
the chairman of the ECB, took along a letter from Straw saying that
the Government did not wish the ECB to tour. This was written after
much consultation between the ECB and officials of Straw's department.
After consultation with their legal team, the ECB were confident that the
letter could convince the ICC that this constituted force
However at the meeting Malcolm Speed, the chief executive of the
ICC, read out a statement that Prime Minister Tony Blair had made when
the Commonwealth acted against Nigeria, banning all contact - including
sporting contact - and the ICC concluded that Straw's letter was merely
It remains to be seen whether parliamentary debates, ending with
resolutions calling for England not to tour Zimbabwe, would carry more force.
If they do not, then England will have to bite the bullet and go. A majority
of ECB board members are coming round to that view.
continues to be growing unrest within the ECB about the way the
organisation's management have handled the Zimbabwe affair.
was fuelled by the fact that a paper making the moral case for not going to
Zimbabwe produced by Des Wilson, who resigned on Tuesday from the ECB board,
was not circulated to all the board members or even discussed before it was
As revealed by The Daily Telegraph on Monday, this anger led
to the chairmen of the first-class counties holding a meeting in Gloucester
to which neither Morgan nor Tim Lamb, the ECB's chief executive, was
The Daily Telegraph understands that at the meeting the chairmen
decided to throw out a proposal to streamline domestic cricket by reducing
the number of four-day and one-day games. Instead they decided to set up
their own review committee to look at the entire domestic
Zimbabwe's rebel players, meantime, have agreed to make
themselves available for selection. The Zimbabwe Cricket Union said
yesterday: "It has been agreed between the ZCU and the 15 cricketers who have
up to now been unavailable for selection that . . . [they] will be at
practice with effect from April 30."
The dispute, which escalated on
April 2 when the ZCU installed Tatenda Taibu as captain after Heath Streak
questioned the composition of the selection panel, is set to continue at
Minister Michel Barnier says the South African government should be given
another chance to try to resolve the political crisis
"There is this mediation which has started and which is
difficult," he said of SA President Thabo Mbeki's initiative to mediate
between President Robert Mugabe and the Movement for Democratic Change
"What I have understood is that we have to give another
chance to this mediation, a mediation for an African country and by
Africans," he told a news conference after meeting with his SA counterpart,
"That is why we will continue to back this
effort at mediation by different regional heads of state, especially by
Mbeki has come under fire from political detractors for
his stance on South Africa's northern neighbour, plunged into crisis after
presidential elections in March 2002 that returned Mugabe to power.
International observers and opposition leader Morgan Tsvangirai have alleged
the vote was rigged.
Zimbabwe is currently in the grip of its worst
ever economic crisis, with inflation at more than 622%, 70% unemployment and
critical shortages of fuel, medicine and food.
Airzim ordered to come up with turnaround
Herald Reporter THE Minister of Transport and Communications,
Cde Christopher Mushohwe, has directed the board and management of Air
Zimbabwe to come up with a turnaround strategy for the national
The minister, who met members of the board and management of the
airline yesterday, challenged them not to be preoccupied with the maintenance
of the status quo but to let their focus be directed on the core business of
"To continue to allow a situation where customers are
never sure whether there will be food service on the airline or not, whether
the airline will take off or not or whether a ticketed customer will not be
told that he or she will not have a place, is no longer an
"There has to be predictability and reliability all the time. The
negative and unpleasant image and conduct of cabin attendants should be
rooted out immediately.
"To do business as usual should not be
accepted. Management and employees must always be customer-driven, and
realise that the customer is the paymaster," he said.
said the turnaround strategy should focus on a brand that can guide, support
and innovate the airline to reclaim its historic position
He said teamwork, fairness and uprightness were virtues
that should also be enshrined in the turnaround strategy.
management and the workers have to work together in coming up with a
turnaround strategy, which is all-embracing and a product
RENEWED efforts to bring Zimbabwe's
two feuding main political parties back to the negotiating table have hit a
brick wall with ZANU PF, increasingly nervous about a negotiated settlement,
now showing signs of ill-feeling over the sincerity and impartiality of the
Impeccable ZANU PF sources confirmed yesterday that
there was a whiff of suspicion within their ranks, with some senior party
officials, who are jealously guarding their positions, alleging that some of
the church leaders pushing for the negotitaions were sympathetic to the
Movement for Democratic Change (MDC). The church leaders from various
denominations have been at the forefront of trying to bring the MDC and the
ruling ZANU PF to the negotiating table which they abandoned almost two years
The sources said that the church leaders, who have been trying
to strike a political settlement between the two parties since last year,
met John Nkomo, the ZANU PF national chairman, and the ruling
party's information chief Nathan Shamuyarira a fortnight ago.
They, however, emerged from the meeting disheartened as it dawned on them
that chances for the resumption of the long-stalled talks were
getting slimmer after the ruling party stalwarts put a damper on their
The sources, who could not say exactly what transpired
during the last meeting, said the men of cloth had since realised that they
were not making any significant headway as ZANU PF was seemingly interested
in dragging the "talks about talks" until the 2005 parliamentary elections.
Their protracted efforts to bring back the two parties to the negotiating
table after the talks had initially been put into the freezer, have so far
drawn a blank.
Despite the moral pressure being exerted on the
parties to find a solution to the country's political crisis, the public
posturing ostensibly in support of the talks by the ruling party and repeated
assurances by President Thabo Mbeki of South Africa, nothing has materialised
mainly because ZANU PF is not interested in the talks.
by the clergy have been further complicated by President Robert Mugabe's
speech during the 24th Independence celebrations in the capital where he
insisted on contrition by the MDC as a pre-condition for any meaningful talks
But the opposition party, seen by ZANU PF as a Western
front, has strongly rejected the President's pre-conditions and instead
insisted on its demands that include levelling the electoral playing field
for it to participate in next year's parliamentary plebiscite.
"We held a routine meeting with ZANU PF leaders on the possibility of the
resumption of talks just before Easter," said Bishop Sebastian Bakare. "There
was nothing special about it, it was just routine. Once there is something
dramatic, we will let you know."
Pressed to disclose what really
transpired in the meeting, Bakare said: "There is nothing that I could say
that this was the result. We will continue trying. Ask ZANU PF what
Shamuyarira, a former Cabinet minister who still
commands a lot of respect among the ruling party's ranks, said details of the
meeting were confidential and not for publication.
confidential discussions and not for publication," Shamuyarira was quick to
say. "That's all I can say for now."
Bishop Trevor Manhanga, who
was recently in Italy reportedly to seek the Vatican's intervention in the
Zimbabwean crisis, said he was still waiting to get a full briefing on the
proceedings from his colleagues.
South Africa, currently at the
centre of this arbitration, has persistently insisted that delegates from the
two political parties were meeting informally, but both have maintained they
President Mbeki has assured the world that talks between
ZANU PF and the MDC, which gave the ruling party a run for its money in the
fiercely contested and controversial 2002 presidential election, would have
resumed by June.
But nothing tangible seems to be taking place
on the ground. The euphoria touched by what were then seen as prospects for
the negotiations between the country's two main political parties has since
lapsed into scepticism and downright depression.
The talks, put
on ice about two years ago after both parties failed to agree on the agenda,
were widely expected to go a long way in resolving the country's political
and socio-economic problems, which have reduced Zimbabwe into a basket
prices of fuel have crept upwards in United States dollar terms in recent
weeks in a development that should see sporadic price reviews of the product
locally, The Financial Gazette can reveal.
Industry players said
the world prices of petrol, diesel and illuminating paraffin, quoted in US
dollars, went up substantially by between US$3 and US$5 per barrel since the
beginning of last month.
Other African countries are factoring in
the increases, but local petroleum industry players are still digesting their
Masimba Kambarami, chairman of the Petroleum
Marketers' Association, said pressure had been on for the past one-and-half
months, but hinted the adjustments by industry players would be
"The increases will be there, but not substantial because
of many issues such as the foreign currency auction system and interest
rates, which are on their way down," he said.
Kambarami said the
depreciation of the Zimbabwe dollar, which firmed following the introduction
of the novel foreign currency auction system in January, would have a serious
effect on fuel prices.
Any increase in fuel prices is likely to fly
in the face of the government's efforts to fight inflation, which came down
by 20 percentage points to 583 percent in March.
fuel prices would also vary from one procurer to the other as some fuel
wholesalers might choose to maintain old prices and make their money by
In South Africa, the department of energy
hinted this week that the wholesale price of diesel and illuminating paraffin
For instance, the price of diesel with a sulphur
content of 0.3 percent was expected to rise by two cents, while that of
diesel with a sulphur content of 0.05 percent would go up by four cents a
Illuminating paraffin would increase by seven cents at the
wholesale level and nine cents under the single maximum national retail
price. The adjustments were based on the international prices for Brent crude
oil moving in a band of US$30 to US$34 a barrel.
operates a system akin to a two-tier pricing structure where the national
fuel procurer, the National Oil Company of Zimbabwe, sources the product at
subsidised prices for use by government and other essential service
Private players within the fuel industry charge
commercial rates, which are constantly monitored by the government to ensure
there is no profiteering.
IN a desperate bid
to cope with the huge backlog of civil and criminal cases, the High Court has
recalled to the bench four retired judges to fill in the vacuum left by
senior judicial officers who have left for greener pastures.
Highly placed sources told The Financial Gazette this week that the four
recalled judges are Justice George Smith, who retired in June 2003, Justice
Rogers Kosa, Justice Mohamed Adam and Justice Nicholas McNally.
Justice Smith, who is the longest serving judge with 19 years of experience
on the High Court bench but never made it to the Supreme Court, confirmed he
would be back on the bench for a period of four months.
back in the High Court next month," Justice Smith said.
judicial system has failed to cope with the increasing number of cases piling
up on a daily basis. Of late, the courts have been flooded with high profile
cases involving government officials and business people caught up in the
Also among the unspecified number of cases
pending in the High Court and Supreme Court are several petitions by the
opposition Movement for Democratic Change challenging the results of the 2000
There are currently six Supreme Court
judges instead of eight, while the High Court, which should have at least 35
judges, has only 16.
Judge President Paddington Garwe said he was
unaware whether his retired colleagues had indeed been recalled, but stressed
that if that was the case, then it was normal as it was part of the judges'
pension conditions to serve for a term if the need arose.
not aware that they have been recalled, but I can confirm that it's part of
their pension conditions," Judge President Garwe said, adding that the High
Court was doing its best to cope with the huge backlog under the current
Since the expropriation of land began in 2000,
relations between the judiciary and the executive have been acrimonious,
resulting in the forced early retirement of Chief Justice Anthony Gubbay from
the Supreme Court bench amid claims of threats of violence and persistent
pressure from ZANU PF for him to step down.
Justice Gubbay was
accused of sympathising with white commercial farmers who were violently
evicted from their properties by war veterans to pave way for the majority of
landless blacks under the controversial fast-track land reform
Chief Justice Godfrey Chidyausiku, widely seen as a ZANU
PF sympathiser, replaced Justice Gubbay who took over from the first
black Chief Justice, Enock Dumbutshena (now late).
About half of
the judges, in both the Supreme and High Courts, have left the bench due to
what analysts said was the erosion of the rule of law, outright harassment,
demeaning acts and remarks targeted at the judiciary and the government's
contemptuous disregard of court orders.
Since then, there has been
a spate of resignations by senior judicial officers including magistrates and
prosecutors in protest, among other issues, against poor remuneration and
conditions of service.
Finance Minister Christopher Kuruneri's chickens are coming home to roost at
the worst possible time.
His weekend arrest comes at a time when
President Robert Mugabe's government is at a crunch point. The government is
undertaking a self-cleansing exercise amid fears that it might bequeath a
terrible legacy to the erstwhile regional breadbasket, which has so far
suffered an unprecedented economic meltdown.
Up until now,
President Mugabe's furious critics who blame the government for turning a
blind eye on corruption, have been watching the unfolding drama in the
ongoing anti-corruption crusade with complete indifference.
attention was this week avidly focused on the arrest of the 54-year-old
Kuruneri as the government, for the first time, took its anti-corruption
scythe to senior officials. Kuruneri's arrest came as President Mugabe, who
had previously been accused of applying the law selectively, repeated his
sentiments that no one would be spared.
Critics had always argued
that the anti-graft crusade was being applied like a spider's web, which
catches the small insects and lets the big ones through. Up until Kuruneri's
arrest, only the less influential politicians had been netted. It was against
this background that some critics agreed that the arrest of Kuruneri denoted
some genuine seriousness in President Mugabe's anti-corruption drive, which
all along has been dismissed as a vote-catching gimmick ahead of the 2005
Others were, however, not convinced
that Kuruneri's arrest and subsequent incarceration would raise a political
storm within the ruling party's ranks. They claimed that the net immediately
closed in on him because he lacked political clout and the government,
desperate to convince the highly sceptical public that no one was above the
law, wanted to make an example of the hapless Kuruneri.
Zimbabwe's political life did not change noticeably or that there was no
tremor caused by the arrest of such a seemingly high-profile government
official seemed to give credence to this argument.
Kuruneri - widely seen more as an intellectual than a political heavyweight -
became the first high profile casualty of the ongoing crackdown on corruption
following his arrest last week on charges of contravening the exchange
control regulations and the country's citizenship laws.
minister was on Monday remanded in custody to May 11 on charges of dealing in
foreign currency involving R5.2 million, 34 371 pounds, 30 000 euros and
US$582 611.99 and possessing two passports - one Zimbabwean the other
Canadian. It is against Zimbabwean laws to hold dual citizenship.
South African newspaper, the Sunday Times, first broke the story
on Kuruneri's investments in Cape Town which was later picked up by the
He becomes the second minister in President
Mugabe's Cabinet to be arrested following that of former Lands and
Agriculture Minister Kumbirai Kangai in 2000. Kangai was arrested but later
acquitted on charges of defrauding the Grain Marketing Board of $228 million
when it imported 460 000 metric tonnes of maize. He was a key member of ZANU
PF during the country's war of liberation.
Party sources said
what could have spurred the internal security agents to dig deeper and bring
the finance minister to book were media reports which suggested that
President Mugabe could have been behind the controversial R30 million mansion
being built by Kuruneri in Cape Town. The media reports claimed the President
was using Kuruneri as a front. Kuruneri himself publicly denied this and
stated that President Mugabe had nothing to do with his real estate
investments in South Africa.
"The President had to be cleared,"
said a party source.
Through the local state media, Kuruneri, the
Member of Parliament for Mazowe West, denied any wrongdoing saying his hands
were clean. "It is clear that I have not been in violation of any Zimbabwean
laws as I could not have externalised resources that did not originate from
Zimbabwe," he was quoted as saying.
He said his funds were
legitimate as they originated from consultancy work conducted outside
Zimbabwe and maintained he had not broken any local laws. The Reserve Bank of
Zimbabwe, which controls the country's financial levers has, however,
insisted that earnings from professional consultancy services conducted
outside Zimbabwe should be deposited in individual Foreign Currency
But mystery still surrounds his possession of a Canadian
passport, which the state alleged he used to travel to South Africa on
Analysts were this week unanimous that if the
state security agents - who only acted on a report from a South African
newspaper - were totally unaware of Kuruneri's financial activities, then it
was a damning indictment on their part. They, however, said this was highly
"He may have been set up, because, who is Kuruneri in the
eyes of ZANU PF?" political analyst Alois Masepe said. "Did they wait to get
reports from South Africa to act or they set him up to convince us that they
are serious. I would like to believe they (government) knew about his
financial interests, home and abroad. The gimmick continues.
they didn't know, then there is something seriously wrong with
our intelligence system. It raises questions as to how much more they know,
but turn a blind eye. Kuruneri is on the periphery. We are waiting to see
them target the core ZANU PF gurus. At the moment, we are dealing with
invited guests to ZANU PF."
Chairman of Transparency
International Zimbabwe Chapter John Makumbe, whose organisation has ranked
the Southern African country among the most corrupt nations in the world,
said although ZANU PF was engaged in self cleansing, more senior party
officials rumoured to be guilty of corruption s hould be
Small fish who do not pose a threat to ZANU PF's
sustenance continue to be sacrificed for cheap political gain, Makumbe
"It's part and parcel of self cleansing on the part of
ZANU PF," Makumbe argued. "Who's is Kuruneri in ZANU PF? A nobody. He is on
the periphery. It's a smart way of offloading corrupt wood in the party, but
it will still remain a political gimmick until President Mugabe starts
hitting at party heavyweights."
Makumbe continued: "If
Kuruneri's appointment as Minister of Finance was a serious one, then it
demonstrates President Mugabe's gullibility. Why he appointed him in February
only to lock him up in April goes to show that no homework was done before
the appointment. It took independent South African newspapers to expose him
for the government to act. Yet they shoot down the private media who expose
these corrupt tendencies. One can argue that they (government) don't really
know who is and who is not corrupt until the private media exposes them,"
Heneri Dzinotyiwei, a lecturer at the University of
Zimbabwe and political analyst had this to say: "It's really difficult to
tell at this stage what this means politically, but I think Kuruneri has a
case to answer. What will happen when it's all over will give us a glimpse
into what is really happening behind the scenes."
always courted controversy. When he was the Member of Parliament for Bindura
and general manager of the Urban Development Corporation (Udcorp) in the
early 1990s, he was sucked into a controversial $5 million deal involving
development corporation. He was initially charged together with Christopher
Mushonga for contravening the Prevention of Corruption Act arising from the
sale of a Glen Lorne plot to Udcorp by Mushonga.
initially alleged that Kuruneri had been bribed by Mushonga to facilitate the
deal between the latter and Udcorp. They were, however, both acquitted on
charges of contravening the Act for lack of evidence.
year in a marked departure from tradition by a senior government official,
Kuruneri publicly admitted the government was stymied as to which way to go
to arrest the economic melt-down. He told a Zimbabwe National Chamber of
Commerce and Friedrich Ebert Stiftung-organised business meeting that
government was governing "through guesswork".
With access to information and the right to free expression now increasingly
considered key to the building of democracy, media workers the world over
celebrate World Press Freedom Day on May 3.
engrossed in a debate on socio-economic and political problems besetting the
country, are also wondering if the media they have is the media they
This comes against a back-cloth of what are widely viewed
by government critics as repressive media laws. These include the Access
to Information and Protection of Privacy Act (AIPPA) and the Public Order
and Security Act.
The laws have raised a hue and cry from the
country's fragmented media industry and human rights groups, who say the
regulations have imposed new limitations and controls on
The critics argue that restrictions imposed by these
new rules should have been swept away with the rubble of the colonial Ian
Already, the draconian AIPPA, crafted by Professor
Jonathan Moyo, the Minister of Information and Publicity in the Office of the
President, has claimed the scalp of the country's hugely popular independent
daily tabloid, The Daily News, which was closed in September last year,
throwing nearly 200 journalists and other media workers onto the
The newspaper, owned by self-exiled Zimbabwean businessman
Strive Masiyiwa, was closed down after the Supreme Court ruled that it had
broken the law by operating without a licence as required under
The situation has not been helped by the fact that a full
bench of the country's highest court has since thrown out an application by
the Independent Journalists' Association of Zimbabwe (IJAZ) challenging
AIPPA, while numerous other court actions by the Associated Newspapers of
Zimbabwe (ANZ) have met with little success, much to the displeasure of
As the country marks World Press Freedom Day,
whose theme this year is "Restore my right to hear and be heard", the
question journalists, media workers and publishers will be asking themselves
is: where to after this?
But is it true, as argued by critics, that
the ZANU PF government, in power for 24 years, does not tolerate
Media experts, representatives of journalists' unions
and political commentators who spoke to The Financial Gazette this week were
unanimous President Robert Mugabe's beleaguered regime was wary of media
They said the government would continue its campaign to
"fight the enemy in the media", a declaration made by officials from the
Department of Information and Publicity when they met editors from the
Zimpapers group in Harare recently.
Lovemore Maduku, chairperson
of the National Constitutional Assembly, said Zimbabweans deserved a better
media than that on the ground. He said contrary to the official position,
there was no press freedom in Zimbabwe.
"We are not enjoying media
diversity. We do not have an independent daily to compete with state dailies.
The independent weeklies that are operating are not sufficient.
"At the state newspapers, there is also a lot of interference by
the government," said Maduku, a lawyer by profession. "We are not happy
with AIPPA. It is squarely responsible for this bad state of the media in
Stanford Moyo, a lawyer with a Harare firm who
represented IJAZ in its failed Supreme Court case challenging AIPPA, said it
was scandalous that journalists in Zimbabwe had been denied the right to
elect their own media controlling bodies.
journalists and lawyers at a Media Lawyers Network annual conference in
Masvingo, said the Media and Information Commission (MIC),which licenses
journalists , comprised state-appointed commissioners and was only answerable
to Minister Moyo.
"Other professions in this country enjoy the
democratic right to elect their own controlling bodies, but not journalists
in Zimbabwe. The MIC is not elected. Journalism is no longer a profession any
more as its practice is now under the control of central government," he
"The laws that have been put in place are heavily loaded
against journalists. I am not surprised that many journalists have left the
country to do menial jobs in the diaspora.
"We are a country
that oppresses journalists. Zimbabwe does not respect freedom of the press
The government loathes a critical stand from the
media because it alleges the country's independent papers are sponsored and
manipulated by Western governments, particularly Britain and the United
States, which have accused President Robert Mugabe's government of human
The government denies the charge and says the
independent papers are being used by the two Western powers to try and effect
regime change in Zimbabwe
Relations between Zimbabwe and
Britain, the former colonial master which ZANU PF accuses of refusing to
atone for its colonial sins, became frosty after Harare seized white
commercial farming land to resettle landless black peasants.
rift widened following a hotly disputed presidential election in 2002, won by
President Mugabe and subsequently challenged in court by
"The media in Zimbabwe is being used as an
extension of foreign policy by Western powers through promotion of hatred,
contempt, internal strife and implied political disaster. There is serious
polarisation that has resulted in decay in ethics, professionalism and
"The media in Zimbabwe confuses freedom of
expression and media freedom. Freedom of expression can be unlimited but
media freedom cannot be unlimited," said the MIC.
sections of the media in Zimbabwe are being used to demonise nationalist and
pan-Africanist political parties that went through the liberation struggle to
restore independence in Zimbabwe. And this is done through calculated
propaganda based on the theoretical principles of liberal democracy and human
"These do not defend the national interests just like what
CNN (Cable News Network) would do to American national interests or what BBC
(the British Broadcasting Corporation) would do to the British
national interests," it said.
John Makumbe, a political analyst
and a critic of the government who teaches political science at the
University of Zimbabwe, bemoaned the crisis in the local media.
"We certainly do not have the media we deserve," said Makumbe. "We are now
stuck following the closure of The Daily News. We have to wait for
the weeklies - The Financial Gazette, The Independent and The Standard - to
get to know what is happening in the country. We cannot rely on the state
media because most of the time, it contains nothing for the readers,"
said Makumbe, who is also chairperson of Transparency International Zimbabwe,
an anti-corruption watchdog.
Makumbe said the independent
weeklies needed to be complemented by at least one independent daily in
exposing graft in both the government and the private sector.
"The weeklies are not enough. It is a shame and scandalous that
small countries such as Botswana have up to eight independent papers,"
"When the question of the state of the media in
Zimbabwe is asked, the obvious and immediate picture that comes into mind is
the closure of The Daily News, the paper that came onto the scene in 1998,"
said Matthew Takaona, president of the Zimbabwe Union of Journalists
"As one goes further, the news content found in the
state-run media organisations like The Herald, New Ziana and the Zimbabwe
Broadcasting Corporation (ZBC) are bound to come to mind," said Takaona,
arbitrarily dismissed as news editor of The Sunday Mail by the government
about two months ago for allegedly addressing troubled journalists at The
"After the closure of The Daily News, the media
pluralism we have in this country is now infinitesimal," added
Takaona said the ZBC's monopoly was a great source of
frustration to the citizens of Zimbabwe.
"We cannot, as a people
who are independent and free, be condemned to a situation of listening to one
opinion every minute of our life and have no alternative. We cannot be
condemned to watching vulgar dances despite calls by the public, whom it
(ZBC) should be serving, to stop those dances. The state media is abusing the
public and they (government) get away with it," he said.
boss said fear had also become one of the worst enemies of press freedom in
Zimbabwe. Fear could also explain the atrocious content in the media, he
said. Even AIPPA itself had instilled fear in that journalists were now
afraid to be associated with editorial material that appeared to be against
the persuasions of the MIC.
"There is the fear that if you are
found to be in such a position, then you may lose your registration or it may
not be renewed after 12 months, effectively ending your job as a journalist
in Zimbabwe. AIPPA has caused the collapse of the media in Zimbabwe," said
announcement by Reserve Bank of Zimbabwe (RBZ) governor Gideon Gono that
international ratings would be mandatory for all banking institutions is
clear evidence that it is no longer business as usual in the sector, which
has been accused of operating on autopilot and disregarding the
The banking landscape, which came close to an outright
meltdown due to the proliferation of non-core speculative activities that
resulted in malignant asset-liability mismatches and downright imprudence, is
now evolving, owing to the ever increasing number of requirements meant
to ensure probity and that the events of the past quarter do not
With effect from January 2005, all banking institutions will
be required by the RBZ to subject themselves to a reputable
international rating system.
"In line with global trends and the
need to encourage local banks to conform to international best practice, with
effect from the 1st of January 2005, there will be a mandatory requirement
that each banking institution be subject to an agreed international rating
"Banks are, therefore, encouraged to prime their
operations and systems for this critical requirement, which is also meant to
enhance the scope for easier brokerage of correspondent banking relationships
between local financial institutions and their international counterparties,"
Many Zimbabwean banking institutions subscribe to
the Johannesburg-based Global Credit Rating Company (GCRC), although they did
so of their own volition in order to boost their profiles.
executive director Dave King told The Financial Gazette that his company,
which has a dominant position in emerging markets and is spread across the
African continent, had received inquiries from many local
"There are about 12 banks which we rate in
Zimbabwe right now. Others have shown interest in coming on board, even
before the recent policy announcement," King said.
As part of
the rating process, GCRC conducts full due diligence analysis, which includes
poring over financial statements, returns filed to the RBZ and on-site
inspections to check on the risk management processes.
At the peak
of the banking sector crisis in January, GCRC, which has operated in Zimbabwe
since 1997, could only provide ratings for no more than eight banking
institutions - less than half the total in the sector.
At the time,
said King, many other banking industry firms had not submitted data for the
ratings at the critical time, forcing the renowned rating firm to withdraw
all ratings previously pronounced on banks that had not
Only Standard Chartered, Barclays, the Central Africa
Building Society (CABS), Kingdom Financial Holdings, the Merchant Bank of
Central Africa (MBCA), the Commercial Bank of Zimbabwe (CBZ), First Banking
Corporation (FBC) and Rapid Discount House were included in the January
survey carried out by GCRC and, incidentally, all came out with favourable
ratings in the BBB- category and above.
one of the firms that got the thumbs-up from GCRC, Rapid Discount House, has
since been closed by the RBZ, which found the institution to be in a
financially unsound condition.
Five other financial institutions -
Intermarket Banking Corporation, Intermarket Discount House, Intermarket
Building Society, Barbican Bank and Barbican Asset Management - have also
been closed during the just-ended quarter, which signalled the end of the
halcyon days in the financial sector, which had survived the five-year
recession that hit the Zimbabwean economy.
The central bank has
signalled that the financial sector storm is virtually over and has been
actively working on rebuilding confidence. The latest move constitutes an
active attempt to not only boost battered confidence, but also provide some
form of oversight through the international credit ratings.
date, foreign-owned banks have consistently scored high in the international
ratings, confirming their "quality" status, which the now discerning,
long-suffering depositor is on the lookout for.
Banks occupying the
top half of GCRC's rating at the peak of the crisis - Standard Chartered,
Barclays, CABS, MBCA and CBZ - are all foreign controlled, with locally owned
FBC, Kingdom and the closed Rapid making up the minority.
said although there "was a long time to go to full confidence, the central
bank did a fantastic job handling the crisis in a very
attached to the future funding of state-owned enterprises which depended on a
life-support system from the fiscus may as well be the missing link that had
eluded Zimbabwe in its quest to root out slackness in the running of
Analysts said the tight conditions, read out to the
perennially loss-making parastatals last week by central bank governor Gideon
Gono could uncover the dirt that had been swept under the carpet for many
years, marking the return to financial discipline and viability.
The top brass in these loss-making entities, they said, might also discover
that the message directed at indigenous bankers in Gono's monetary policy
review last Wednesday aptly apply to them as well.
The Reserve Bank
of Zimbabwe (RBZ) boss, who has the tough task of cleaning market
imperfections embedded in the local economy, told indigenous bankers who have
been squeezed by an acute liquidity crunch caused by improper banking
practices to either "shape-up or pack-up".
Gono proceeded to dangle
about $165 billion worth of loans to state enterprises and local authorities,
which they can only access after meeting stringent conditions.
"After July 31 2004 the facilities will cease to be available to
the institutions. Applications for support must be accompanied by
credible turnaround plans to rid themselves of current bottlenecks, including
manning levels, board and management structures, which make economic sense,"
"Without these supporting documents, the Reserve Bank
will not avail them of the productive sector monies, which are cheap and
necessary for their turnaround. At the end of July 2004, the Reserve Bank
will publish which of these parastatals and local authorities will have
succeeded in accessing the funds, while failure to do so will reflect
shortcomings inherent at the institutions, which stakeholders will naturally
get to know about."
Analysts this week described the
conditionalities as a tall order for the parastatals, which have not exactly
justified their existence because of their persistent funding from the
Almost every parastatal is limping because of acute
cash-flow deficiencies caused by operational constraints and debt overhang in
a high interest rate environment.
As of November last year, the
total contingent liabilities for the entities excluding the Grain Marketing
Board (GMB) exceeded $62 billion.
GMB, which enjoys a monopoly in
the purchase of grain from farmers, had trading and accounting losses in
excess of $60 billion as of that date. The parastatals also had more than
US$755 million owed to international creditors, which they cannot pay because
of the shortage of foreign currency.
The shortages of hard
currency, blamed on poor exports and the lack of balance of payments support
that became evident after the International Monetary Fund pulled out of
Zimbabwe, has virtually dried imports of essential inputs and raw
At the same time, the parastatals cannot access external
lines of credit due to the country's high political risk worsened by the
heightened animosity between Zimbabwe's main political parties, the Movement
for Democratic Change and the ruling ZANU PF.
most of these parastatals has continued to deteriorate due to limited
resources for maintenance and limited new investment, among
Anthony Mandiwanza, chairman of the Cold Storage Company,
which has just laid out a recovery path, admitted that it would be
"mission impossible" to try and get the economy back on its rails until such
a time when parastatals start to tick.
Mandiwanza, who is also
the president of the Confederation of Zimbabwe Industries and managing
director of a former parastatal, said the conditions were standard practice
adding, "they are workable and indeed must be applauded, because parastatals
should not escape issues of corporate governance."
next six months to December 2004, the RBZ has pledged to extend cheap funds
to parastatals at 50 percent interest rate.
The national passenger
airline, Air Zimbabwe, which had been thrown out of the International Air
Transport Association because of non-payment of fees, was offered a maximum
loan of $7.5 billion.
The Zimbabwe Broadcasting Corporation, which
has been transformed into ZB Holdings and has not made a profit since 1980,
may also get $7.5 billion.
Other parastatals set to benefit include
the Zimbabwe Electricity Supply Authority ($30 billion), the National
Railways of Zimbabwe ($20 billion), the Zimbabwe Iron and Steel Company ($30
billion), Wankie Colliery ($15 billion), the Zimbabwe United Passenger
Company (ZUPCO) ($10 billion) and the Agriculture Rural Development Authority
A local analyst, Farai Dyirakumunda, said the
funding was meant to create a suitable environment, where service delivery is
uninterrupted, for the entities to operate viably.
credible turnaround plans, he said, was meant to ensure that funding is not
sunk into a bottomless pit but is channelled towards enhancing capacity
utilisation and working capital relief.
"The July 31 deadline may
be an issue though, but they (parastatals) have a couple of months to sort
themselves out. The loan is also for a period of six months, which is rather
limiting for certain institutions given the lengthy turnaround time in some
cases," said Dyirakumunda.
Dyirakumunda said the institutions
should be run on commercial lines and could possibly diversify their product
lines into high margin products.
For example, he said, ZUPCO could
venture into haulage, which is a high margin business.
working for PTC and definitely there is scope for them (parastatals) to be
run on commercial lines, but what is needed are proper control systems and
"The end goal should be to privatise or at least fully
commercialise them. This funding should be a gradual step towards that," he
Entities that have been privatised so far have successfully
weathered the storm and are holding their own on the Zimbabwe Stock Exchange
(ZSE) where they now rank among the country's bellwether stocks.
Dairibord Zimbabwe Limited became the first parastatal to be privatised and
listed on the ZSE in 1997, followed by the Cotton Company
Economic consultant John Robertson said while it
would be tough for the parastatals to measure up to standard, the RBZ should
be applauded for trying to instil discipline in organisations.
"It was long overdue and it should never have been allowed to get this bad
and I hope it will not get worse than this," said Robertson.
going to be hard, but obviously they (parastatals) will continue to run. It's
the first step to getting them back. You cannot make up for what has been
lost, but you can certainly reinstate the
Robertson said the parastatals would now
need to avoid interference from politicians if they are to get back on the
He said despite clear legislation on the reporting
procedures for parastatals, some have not published their accounts since 1976
and it was confusing where they got their figures when requesting for
subsidies from government.
IN what could trigger a showdown
between the Presidency and three Cabinet ministers, Vice-President Joseph
Msika has vowed not to rest until the recent invasion of Kondozi Farm in Odzi
has been reversed.
Msika is the chairman of the Land Acquisition
Committee. His stance could bring him into direct conflict with three Cabinet
ministers - Professor Jonathan Moyo, the Minister of Information and
Publicity in the Office of the President and Cabinet, Agriculture and Rural
Development Minister Joseph Made and Transport and Communications Minister
Christopher Mushowe. The three have insisted that the disputed farm belongs
to the state.
Before Moyo's intervention, Made and Mushowe had
been at loggerheads with Edwin Masimba Moyo, the majority shareholder of
Kondozi, over the acquisition of the farm which enjoys Export Processing Zone
(EPZ) status. Under the law, a farm with EPZ status cannot be compulsorily
Kondozi Farm, also known as Canvest Farming, exports
flowers and vegetables to Europe and South Africa.
It employed 5
000 workers before it was taken over. Msika said he would rather die with his
views than allow thousands of farm workers to be rendered jobless and
homeless especially under the current economic environment.
Speaking at a field day at Old Citrus Farm owned by ZANU PF chairman for
Mashonaland West, Philip Chiyangwa, last Friday, Msika said:
don't work with newspapers . . . the truth will always prevail. Our land
reform policy is one. Even ZANU PF and PF ZAPU had a similar policy that's
why it was not difficult to unite. Orientation to the people . . .
we dovetailed into one. Yes, small institutions like ARDA (the
Agricultural Rural Development Authority) and DDF (the District Development
Fund) are very important, ladies and gentlemen. But I can't support someone
who will evict 15 000 women and children and throw them on the streets. I
won't support that. I will not support that. Even if all of you support that
and I remain alone in my view, I'll die with my views."
added: "Something is brewing in Mutare . . . Kondozi. Seventy people came to
my house and woke me up around 4 am. I asked what the problem was and later
told them to go and see John Nkomo . . . but they said they had sent a
delegation to him to no avail. I told the Manicaland governor (retired major
general Mike Nyambuya) to allow the people to go back."
delegation that met Msika seeking the reversal of the evictions included
chiefs and headmen from the province.
During the Easter holiday,
heavily armed riot police and soldiers using water cannons, forcibly evicted
the farm workers to pave way for the smooth occupation of the property by the
Agricultural and Rural Development Authority (Arda). Arda is currently on the
The displaced farm workers and their families are now
living out in the open along roadsides with their household goods and other
possessions, hoping that someone would soon address their
At the same occasion the vice president, who publicly
admitted a rift within the ruling party, called for unity and castigated
those seeking the demise of their colleagues.
He said prior to
the visit to Citrus Farm, he had been advised not to attend the field day
because of claims that whites were still on the farm using Chiyangwa as a
front through FSI, owned by business mogul Mutumwa Mawere.
received a telephone call yesterday from someone urging me not to attend this
field day," Msika said. "But I said since I was in charge of land
redistribution, it was my duty to go and see the progress being made and hear
for myself the nature of the problems there. But the person insisted . . . I
will not disclose his identity. I said 'now that you don't want me to go, the
more reason why I should go'."
He added: "I was told that the farm
was being used by whites. If we see that you have brought back the whites
clandenstinely . . . We will remove you and your white man off the property.
I knew what was happening here . . . I knew FSI was here . . . and that
Chiyangwa was renting farm equipment from them. There is nothing wrong in
renting equipment from those that have it. I personally rent
Msika then said Chiyangwa had himself to blame for his
arrest on allegations that he obstructed the course of justice, perjury and
contempt of court because he was too outspoken.
his mistakes, he talks too much," Msika said. "That's what I want to tell him
as a brother. Don't talk too much, you will be held accountable and
responsible. He never committed a crime here (Mashonaland West) but there in
For first time in 45 years, Trade Fair opens without its
Staff Reporter 4/29/2004 7:16:38 AM (GMT
BULAWAYO - The 45th edition of the Zimbabwe International Trade
Fair (ZITF) opened here on Tuesday without its chairman Mthuli Ncube, who
is allegedly hibernating in South Africa amid revelations police want
to question him on economic-related crimes.
government and the ZITF Company played down the impact of Ncube's absence
from the fair, which runs until Saturday, exhibitors said it was embarrassing
that for the first time in the event's 45-year history, it was being held
without a chairperson to welcome participants.
"It might look like
a small matter, but this has never happened," said an industrialist who has
participated at ZITF for several years.
"It's not proper. He
(chairman) must be running around with ministers and other invited guests,
but this is now being done by the general manager, who has a lot on his
hands, as he has just been appointed to the post."
Ncube, the chief
executive of Barbican Holdings, left the country in inauspicious
circumstances after investigations by the central bank revealed its flagship
commercial bank was technically insolvent.
Ncube, who is also the
chairperson of the government-run National Investment Trust, joined several
Zimbabwean banking sector chiefs who have sought sanctuary outside the
country - mainly in South Africa, Britain and the United States - following
allegations of financial irregularities.
Samuel Mumbe-ngegwi, the
Minister of Industry and International Trade, said the absence of Ncube was
insignificant because the ZITF had not experienced any problems.
"You can see the trade fair is proceeding. So the issue of the chairman being
not here is insignificant," said Mumben-gegwi at a
"The ZITF management is firmly in charge and
you can tell by the activity here.
"We are optimistic the fair
will be a resounding success as we have exhibitors from China, Botswana and
other nations," he said.
About 600 foreign and local exhibitors are
taking part at this year's trade fair, whose theme is "Promoting regional
Namibian President Sam Nujoma will officially open the fair
ZANU PF's Mashonaland West province has issued Member
of Parliament for Makonde, Kindness Paradza, with a prohibition order
suspending him from carrying out party duties in his
The order comes against the backdrop of Paradza's
attack in Parliament of the draconian Access to Information and Protection of
Privacy Act and allegations that he solicited for support to take over The
Tribune newspaper from businessmen sympathetic to the opposition Movement for
Paradza, who has been in parliament for less
than a year, is being accused of conspiring to undermine the ZANU PF
govern-ment's policies, disrespecting the party's hierarchy including
President Robert Mugabe, gross indiscipline and fanning disunity among party
In a letter to Paradza, John Mafa, the deputy party
chairman for Mashonaland West and chairman of the provincial disciplinary
committee said the MP had undermined the party's authority in comments
attributed to him and published in the state media.
Part of the
prohibition order reads: "You are suspended from carrying out any party work
in the Makonde district and particularly Makonde constituency. You will
appear before the disciplinary committee on due dates and in this case on May
27 2004, at the ZANU PF provincial office, Old Hospital, Chinhoyi, or such
other place as may be suggested in writing by the chairman of the
The Sunday Mail last week reported that
Paradza, the publisher of The Tribune, was heavily involved in an attempt to
buy a controlling stake in Africa Tribune Newspapers (Pvt) Ltd by seeking
funding from the defunct Associated Newspapers of Zimbabwe bosses Strive
Masiyiwa and Sam Sipepa Nkomo.
However, Paradza denied the
allegations in comments attributed to him in The Herald, saying: "There is
nothing like that. I have never talked to Strive Masiyiwa since 1996 and I
have never talked to Sam Sipepa Nkomo and they are not involved in any way in
the takeover of The Tribune. We have since taken over management of The
Tribune and we have paid for it in full using our own resources . . . They
can go ahead with the meeting. I will go to Makonde and win hands
The order went on: "May we take this opportunity to remind
you that only party cadres authorised by the party, stand and win against
the opposition hands down. ZANU PF never goes for parliamentary
elections against each other since those that hold such high office are
expected to hold high the values of the party's virtues."
letter was copied to the Minister of Special Affairs and ZANU PF national
chairman John Nkomo, Minister without Portfolio Elliot Manyika, provincial
chairman Philip Chiyangwa and the district coordinating committee chairman
identified only as Makumbe.
A FORMER senior
manager with Century Bank, Charles Nyoka, was arrested this week in
connection with a fraud case involving $7.7 billion fleeced from Trust Bank
late last year.
Police picked up Nyoka, the general manager of
Century Bank's treasury department, earlier this week leading to the recovery
of goods and cash amounting to $4 billion.
It is alleged that
Nyoka, in connivance with Trust Bank officials employed in the treasury
department - Menard Diva, Clemence Tapiwa Mudangwe, Simbarashe Mwonzora and
Clifford Maveto - and an outsider Witness Mahata siphoned a total of $7.7
billion from Trust Bank.
It is alleged that they used forged
electronic transfer forms to enter $5 billion into Century Bank account
The remaining $2.7 billion was allegedly
transferred to Datvest account number 0114009613901 held at NMB Bank, Angwa
Street branch in Harare.
Police spokesman Wayne Bvudzijena could
neither deny nor confirm the latest developments, referring all questions to
Andrew Phiri who could not comment by the time of going to
It is alleged that Nyoka received the funds, which were
transferred to Century Bank through Michell Brophy's account number
1601-159936-020 held by the bank.
Nyoka is accused of opening a
call account with Century Bank where he transferred $3 billion. On December 1
2003, Nyoka allegedly withdrew $1.26 billion from the call account and he was
allegedly given $20 million as his share of the spoils and invested the money
with NDH limited.
The following day, Nyoka allegedly facilitated a
withdrawal of $598.5 million from the call account and he was allegedly given
$9.5 million as his share and he invested the money with NDH
On December 3, 2003 Nyoka allegedly facilitated the
withdrawal of $288 million from the call account and he allegedly benefited
$4.5 million and invested the money with NDH.
benefitted to the tune of $34 million and managed to withdraw $10 million and
the balance of $24 million was frozen and is still being held by
Trust Bank dragged Datvest, its managing director Remo
Pollastri and a local businessman Yusuf Ahmid to court on allegations that
part of the $7.7 billion was deposited in a Datvest account.
Datvest used $2.7 billion to purchase NMBZ shares through
The 14 million NMBZ shares were bought through
a special bargain price of $187.50 per share of which 12 million shares were
purchased from Pfuko Investments owned by NMBZ staff.
THE talking point in Zimbabwe this
week is the arrest of the beleaguered Finance Minister Christopher Kuruneri,
accused of violating the country's exchange control regulations. He now has
the distinction of being the first high profile government official to be
nabbed in the anti-graft crusade.
For some, with the
unprecedented move to arrest a Cabinet minister, the authorities have just
taken the first few steps towards their pledge to decisively deal with graft.
To these people, government has now assuaged the general perception that in
its anti-corruption drive, it is applying the law like the proverbial
spider's web which catches only the smallest of insects and lets through the
However, for the legion of sceptics who had watched with
deepening concern the festering cancer of corruption eating at the very
fabric of Zimbabwean society, the government will have to do much more to
earn plaudits for honesty and sincerity over the anti-corruption
While the arrest of the minister has to a certain extent
captured the nation's imagination, the sceptics, who are obviously and
justifiably bent on stiffening the government's hand, have burning, pertinent
questions. These include: how will the situation develop from here? Will this
prise open the previously opaque areas of public figures' lives? Could it be
that Kuruneri is a political lightweight who lacks a power base of his own
and is therefore expendable? Does the government have the sincerity,
political will and capacity to take what might turn out to be a double-edged
sword to its full expression? Why the missionary zeal now when corruption
cases have in the past been swept under the carpet? Is there anything
fundamentally different between the corruption then and now? And most
importantly, is the government no longer intimidated by the fear of risking
the ire of the enemy within?
These questions will inevitably
crop up because this is Zimbabwe where, for the rich, powerful and
influential politicians and their cronies, justice has at most been cheap and
at worst blind. The questions are born of a healthy scepticism among
Zimbabweans who are showing anger and consternation over deep-seated
corruption. In any case, nothing is hardly what it seems in Zimbabwean
In short, what is being questioned here is government's
commitment and sincerity to rid the country of corruption, which is blamed
squarely on its shoulders. A significant portion of the country's
long-suffering people believe that corruption fed on a deeply rooted
political patronage system. It was through political connections and
back-scratching relationships that politicians, whose assets must now be
subjected to unprecedented scrutiny, cut underhand deals to the detriment of
Who will forget the crony capitalism perfected at the
now defunct United Merchant Bank (UMB) owned by the late eccentric and
self-proclaimed black economic empowerment activist, Roger Boka? The bank,
which operated for just three years until it imploded under its absurdities
in 1998, had a mountain of delinquent loans where funds were pumped to
politicians and politically well-connected businessmen who ran up large debts
in misguided expansion plans. The bank, which lacked pre-lending assessment
which, under normal circumstances should really be the basis for the initial
decision whether or not to extend credit, fell prey to greedy
The goings-on at UMB, which up until now was
Zimbabwe's most scandalous banking failure, sent some seismic disturbances
throughout the financial sector which are still reverberating to date. Other
than one or two individuals who were declared prescribed persons and despite
the hiring of a firm of international "forensic accountants", no one was
arrested. This was despite the fact that the original sources of these funds
could have been the pay-as-you-go pension house, the National Social
Security Authority, the Posts and Telecommunications Corporation and the
National Oil Company of Zimbabwe, among other public institutions. Sadly this
is seemingly being treated as water under the bridge.
issue that sticks out like a sore thumb is the unresolved issue of the
uncouth social welfare cheats who unashamedly looted the War Victims
Compensation Fund. There is also the abuse of the VIP Housing Scheme, the rot
at NOCZIM which almost ground industry and commerce to a halt and the
corruption at the Grain Marketing Board which bordered on treason as a
significant number of people faced starvation. The list
These and many others haemorrhaged the economy. They
also implicated some of the country's biggest political egos, who are walking
the streets free, or even worse, holding public offices. Now that the
government is moving from rhetoric about the fight against corruption and
"contemplating" action, doesn't this provide a perfect window of opportunity
to revisit these cases with a view to bringing the culprits to book
irrespective of who they are and then throw the keys into the deepest part of
the Zambezi River?
FUTURE development in the field of
youth may well depend upon the ability of governments to manage substantial
changes and improve the situation of youth under conditions of limited or
Achieving the necessary combination of
macro-economic and macro-social strategies has been one of the major problems
faced by many governments. Hence it is extremely important to further improve
the managerial abilities of governments as well as policy-making and the
development of infrastructures in the field of youth.
determinants of the situation of the youth - economic, environmental,
socio-cultural and demographic - may be influenced to varying degrees by
policy interventions. The need, therefore, is to ensure that these
interventions are balanced.
Such a process will clearly depend upon
the ability of youth to articulate their own interests and to mobilise enough
support for them. The role of governments will be to initiate a broad-based
dialogue with the youth, to support their activities and to enhance their
active participation at the decision-making levels in society.
Last week I identified the crisis of unemployment as one of the major cancers
facing young people. With emphasis now being placed on small- to medium-scale
enterprises as a national development strategy, it is crucial for the
relevant ministry to initiate multiple economic schemes directed specifically
at the youth. The same applies to the Ministry of Youth Development, Gender
and Employment Creation itself and the Agriculture Ministry, including any
other ministry where an opportunity for the advancement of youth and the
effective utilisation of their vast development potential
This must be done in a planned and coordinated manner and
not the ad hoc and opportunistic approach of the government which is only
meant to serve partisan political interests.
projects involving two or more ministries can be initiated so as to pool the
scant resources that may be available. In an effort to develop and promote
youth entrepre-neurship, the government can establish special fund schemes to
cater for various specific youth problems within the broader national
economic developmental framework.
The idea should be to tackle the
unemployment crisis at the grassroots and emphasis could be put on the
creation of small-scale industries and cooperatives; and rural-based
employment opportunities, including related services - credit, legal and
Special attention should be given to the
situation of youth within a human resource development policy; the situation
of youth employment, promotion and coordination of training in appropriate
skills, including managerial training, orientation to the world of work and
What is extremely important is that
these special fund schemes should guarantee access by young people to credit
and loan facilities without collateral.
If the nation is serious
about indigenisation and black empowerment in the field of youth, then we
must just dispense with the requirement of collateral because the majority of
youth simply do not have it. The viability of the proposed project itself
coupled with the proven abilities and expertise of the beneficiaries should
be enough collateral and the government must act as guarantor. Other special
categories of funds can be introduced which require a minimum of
State-run businesses and enterprises could be enlisted
to provide counterpart financial and technical support for such schemes.
Cooperative schemes involving young people in the production and marketing of
goods and services should be developed.
Government can also
provide incentives for private sector participation materially and
financially so as to broaden the resource base of these schemes. For example,
government can cut or reduce taxes on private businesses, especially
multi-national companies, trans-national lobbies and elite trade associations
which willingly and voluntarily dedicate certain percentages of their profits
to these various youth schemes.
The Central Bank, within the broad
context of its monetary policy, can also give strategic support including
providing incentives for banks and other financial institutions within its
jurisdiction to participate in support of the national youth development
policy, which will eventually benefit the same businesses and financial
institutions in the long run.
But for this to be successful it
requires that the development of the national youth policy itself must go
through the rigorous process of broad-based and comprehensive consultations
involving multiple stakeholders like government, youth organisations with all
their diversity, non- governmental organisations, the private sector, the
financial sector, civil society etcetera. All stakeholders will then
obviously fell that the national youth policy is their own by virtue of
having made an input into it and will be naturally inclined to support
There must be specific legislation evolving from this
broad-based and comprehensive consultation process, giving the youth
themselves substantial power of supervision over the implementation of these
special fund schemes. Infact these various schemes should be the creation of
a statute or Act of Parliament which clearly spells out the functions to
which the funds will be put, the various responsible authorities and /or
institutions which disburse/ administer the funds, upon what preconditions or
requirements, the monitoring and evaluation strategy and so on and so
The disbursement process must be decentralised to all the
provinces although there may be a central control mechanism if that is
found preferable. Provincial and district monitoring and evaluation networks
can be developed to supervise and take stock of the success or otherwise and
the rate thereof, of the various youth projects. The monitoring and
evaluation networks will make appropriate recommendations upon a careful and
informed analysis of the situation on the ground and the grounded realities
of the youth themselves.
Within funds designated for youth
employment government should designate fixed percentages / quotas for
programmes supporting the efforts of young women, youth with disabilities and
other various sub-categories of youth who find themselves at the margins of
society. There are many young people who have either lost their jobs in the
acquired farms or have been displaced or in some other way prejudiced by land
acquisitions, and those ones also deserve special attention.
the foreseeable future almost half of the developing world's population will
continue to be classified as rural. With such large numbers of people living
in rural areas, emphasis must also be placed on involving youth in learning
improved agricultural practices through both formal and non-formal training.
Experimental commercial farming programmes directed at young people should be
initiated, including direct marketing groups, production and distribution
co-operatives to bring agricultural products directly from young farmers to
The aim of such groups will be to reduce food shortages
and losses from defective systems of food transport to markets. The
improvement of educational opportunities in rural areas is necessary to
provide incentives for rural youths to stay in their communities as full
participants in rural development. The growing urban segment of the
population is becoming increasingly dependent upon agricultural production
that must be geared to creating enough surplus to feed the growing population
of non-producers. In my view, increased production will to a large degree
depend upon incentives at the farm level. In the same vein, rural to urban
migration will be reduced only when the apparent disparity between the two
sectors is reduced. However, in effect our future in the global economy lies
in our ability to make a paradigm shift from the land-based economy to the
knowledge economy characterised by information technology, financial
services, biotechnology, manufacturing, mechatronics and
In many situations students, even though integrated
into the formal educational structure, may suffer from a disjunction between
education and the world of work as well as from an inadequate socialisation
process. Few statistics are available to trace the transition of youth from
education to employment, and from their situation as children to new roles as
spouses and parents, hence it is difficult to properly analyse and plan for
these key elements of the life cycle. Such young people are often destined
for the margins of society, where they are abused and exploited.
There has to be closer co-operation between education officials on the one
hand and employers on the other so as to facilitate planning of curricula
that meets the concrete needs of society, by looking at the situation of
young people within a human resource development policy.
music, theatre and dance, including other cultural activities can also be
vigorously promoted as a source of income for creative and innovative young
people, especially if this is coupled with an equally vigorous marketing of
our tourism industry. When looking at the situation of youth in the promotion
and development of the national culture, it is important to strengthen and
co-ordinate all governmental and non-governmental activities at the level of
the family, school and community, involving parents, public authorities
(whose role would be primarily to motivate, organise and co-ordinate), school
authorities and youth organisations, so as to ensure a multi-faceted yet
coherent transmission of cultural heritage, both respectful of the past and
Youth cultural participation, which
expresses itself in artistic amateur groups and activities of cultural
centres, is an ideal field of action for youth. It is essential to promote
the social recognition of youth participation in the creation of new forms of
art and cultural values, to encourage them to consider culture as an
important part of life. Culture is not a stable or self-contained but an
interactional phenomenon, characterised by a high degree of variability
(within cultures as well as between them) constant negotiability and
The rebellion of youth against
authority is meant to keep institutions flexible and not to reject the
heritage of past generations. To ask the youth to speak only to one another
is to leave them without history; to ask them to speak to adults is to ensure
continuity in man's heritage. We appeal to the older generation to leave
behind a good political culture of tolerance, unity and co-operation. Such a
culture is the back-bone of success for future generations.
This contribution can not be exhaustive, hence emphasis that developing a
youth policy requires a multiple-stakeholder and holistic approach. Youth
policies should be wide-ranging including measures directly and indirectly
concerned with youth activities, as well as elements concerned with the role
and place of young people in each area and sector of national
This should encompass the role and place of young people in
education and training; in agriculture and rural development, in health and
the promotion of primary health care; in commercial and industrial
development; in the protection and improvement of the environment; in the
promotion and development of tourism and the national culture; in science and
technology; and in community organisations, trade unions and political
Isaya Muriwo Sithole is a Harare-based legal
participation in the multi-billion-dollar Great Limpopo Transfrontier Park
(GLTP) is in doubt following bickering over the awarding of title
It has emerged that the private sector, which was billed to
develop Gonarezhou National Park, has spurned government's offer for a stake
in the initiative unless they are given title deeds for their specific areas
The project, which also involves Mozambique and
South Africa, has suffered protracted problems on the Zimbabwean side as
there is no development as yet of requisite infrastructure such as roads,
bridges, hotels and lodges, a senior official in the Tourism and Environment
In Zimbabwe, the area included in the extended
park has had many years of successful conservation and sustainable use,
either in the form of a national park or private game ranches with much of
its tourism potential remaining largely unexploited, industry players
The cash-strapped Zimbabwean government had pinned its hopes
of developing the park on the private sector.
official said players in the tourism industry were now sitting on the fence
following government's refusal to grant them land rights. It has also emerged
that families which were illegally resettled in the buffer zones of the park
have stayed put despite government assurances that they would be
"The private sector has shelved plans to invest in the
area with no land rights. They want to be given title deeds," said the
The government has made very little, if any,
progress in the development of the park.
Zimbabwe's partners in
the project - Mozambique and South Africa - have already committed a combined
R105 million for the park on the strength of multilateral donor support and
strong domestic economies.
Concerned players in the tourism
industry said this had left Zimbabwe the only country among the three failing
to implement the project, or at least move at the same speed as its
"No local or foreign investor will come to invest
under the current circumstances.
"There are also fears that
government will take over the properties after the park has been developed,"
It has also emerged that government has allocated grants
to the National Parks Authority and the Forestry Company of Zimbabwe to
develop the area.
"On its own, government is not able to develop
the park, hence the invitation to parastatals to join the
"This means Zimbabwe will not immediately benefit from the
park, touted to be the world's largest wildlife sanctuary," she
A chief executive of one of the country's leading
hospitality groups said illegal settlers have to be removed from the
"It is difficult to commit billions of dollars in an
investment we are not guaranteed ownership of the land. The settlers have to
go if any progress is to be made," he said.
wildlife park was set up to promote tourism.
Analysts have said
tourism has been one of Zimbabwe's few bright spots but it, too, is losing
its glitter as there are now less tourist arrivals amid a dented
Prevention of Corruption Act: how effective is
4/29/2004 7:41:57 AM (GMT +2)
corruption is a pre-condition for a successful democracy.
strong leadership with dedication and moral authority embedded in
unquestioned integrity can successfully do so.
It is hoped that
the government will intensify its crusade against corrupt individuals and
organisations. To start with, the government must learn to respect its own
laws so as to prove its commitment to the rule of law and the creation of
order in the country.
As early as 1985, the government saw the need
to deal with corruption and passed the Prevention of Corruption Act No 34 of
1985 (The Act).This statute is now Chapter 9:16.
Act has been part of our law, it has to some extent remained obscure and
unavailable for use against high-level corruption.
Over the years,
it has on isolated occasions been applied against a few public officials
charged with low-level and sometimes even
The purpose of the Act, as provided for
in its preamble, is to " provide for the prevention of corruption and the
investigation of claims arising from dishonesty, or corruption, and to
provide for matters connected therewith or incidental thereto".
It can clearly be observed that this legislation had very noble objectives.
Its fundamental aim was to prevent the incidence of corruption among public
officials and the society at large.
However, the alarming high
levels of corruption permeating every anatomy of our society illustrate
hopeless failure in the application of the Act.
proves that the government has been apathetic in its quest to deal with
economic debauchery and kleptocracy.
Over the years moral decadence
and a peculiar propensity to indulge in personal aggrandisement has crept
into our society. Gradually, moral imperfection has corroded and devalued our
moral integrity, culminating in the wanton looting and plunder that is now
It is argued here that if the Act had been applied
robustly and consistently without fear or favour, corruption would not have
escalated to the crescendo it has currently reached.
will to apply this statute had almost rendered it obsolete, but now it can
easily be an effective arsenal available to the government in its
This article seeks to investigate those
sections of the Act relevant to the fight against corruption and possibly
suggest means of consolidating them. It is only through an effective law,
coupled with strong will on the part of the government and other relevant
role-players like Parliament, that the prevalent rottenness can be
The Act identifies categories of officials who must not
indulge in corrupt practices. These are, but not limited to: trustees of an
insolvent estate; liquidator of a company; executor of a deceased estate;
legal representative of a minor, prodigal, or imbecile; a public officer and
any member of a board of directors.
Later sections of the Act
also identify "any person", including a member of the public, thereby
broadening the list of possible culprits targeted by the Act.
Section 3 outlines a host of what are deemed to be corrupt practices. Thus,
it is being corrupt for one to solicit, accept or agree to accept a reward as
an inducement to perform or not to perform any act. It appears the case of
the Reserve Bank official alleged to have solicited a bribe to cover suspects
in the foreign currency scandal would be covered under
Any person who contravenes this section, if
convicted, is liable to a fine or imprisonment or to both the fine and
imprisonment. The value of the fine shall be three times the value of the
gift or consideration.
Just as an illustration, if a police officer
receives $1 million to destroy a docket, the fine upon his conviction must be
It is important to note that one can be imprisoned for
a period not exceeding 20 years.
Although this Act provides for
such a heavy penalty, the courts have been hesitant to impose it. But in view
of the prevalence of corruption, our courts must adopt a firm position and
register society's abhorrence of crookedness by imposing exemplary custodial
sentences and heavy fines.
Further, upon the conviction of a
corrupt individual, the court can declare any goods or gift paid forfeited to
Section 6 creates an interesting scenario. Where the
Minister of Anti-Corruption suspects any individual to be involved in
corrupt activities, he can cause such an individual to be "specified".
Effectively, such a "specified" person will not, among other things, be
allowed to operate a bank account, to dispose of his property or to perform
duties as a director of a company, except with the authority of an
investigator appointed by the minister. The said investigator shall report
his findings to the minister.
The Act is silent about what
course of action the minister must take upon receipt of the report. And it is
here that the statute is found wanting. It can only be assumed that the
logical step to take would be to surrender the report to the police for
possible prosecution of the corrupt individual.
in the Act is said about the frozen bank accounts nor the lifting of the
"specification". Perhaps it is the investigator's report that will dictate
the course of events.
The above analysis of this otherwise
important section proves that this law is half-hearted and toothless when
dealing with high-level corruption. Most business moguls, individuals, public
officials, companies and civic organisations have allegedly indulged in
corrupt activities but only a few have been specified; in fact, the only
individuals so specified have been the suspects in the "gold scandal". The
rest, it appears, have escaped the uncoordinated attempt to net
This is so despite the abundant evidence of corrupt
activities by these individuals and organisations. The Act, particularly
Section 6, has not been effectively applied, perhaps due to ignorance,
goodwill or some sinister reasons best known to the
There are individuals who, within short time spans,
have amassed obscene wealth well beyond their means. These have taken
advantage of the laxity in our law and the government's ineptitude and have
built empires of wealth hardly justified by the incomes they
With the collusion of public officers and other accomplices,
they have looted, laundered, pilfered, indulged in speculative activities
and "externalised" vast sums of money to the detriment of the
This ultra-selfish class of Zim-Mafias, syndicates,
gangsters and white-collar hoodlums caused havoc to our economy while the
government remained aloof.
The sole reason why our economy is in
its present sorry state is because there has been a deliberate disregard of
public accountability and the promotion of anarchy. If the government had
effectively monitored activities of individuals and organisations by applying
the provisions of the Act, our economy would certainly not have degenerated
to the extent it has.
There is need for Parliament to revisit
the Prevention of Corruption Act and fine-tune it. Rather than merely specify
suspected corrupt individuals and organisations, it is suggested that more
robust and ruthless measures be taken. These must be practical and
effectively deal with all manifestations of economic debauchery.
Such new laws must be inclined towards recovery of the ill-acquired wealth
for the benefit of the state. To start with, it would be proper to render
impecunious suspected corrupt officials by forfeiting their property to the
state pending investigations. Where there is prima facie proof of corrupt
dealings, the state must be allowed, through a court order, to recover
products of ill-dealing. Such court orders are commonly known as Anton Piller
orders in other jurisdictions.
This suggestion is made because
crooked individuals are smart and have means of hiding their wealth if
current means are applied.
It is therefore suggested that a special
court be created. It would also be prudent to mandate the Attorney-General's
Office with power to both investigate and prosecute individuals and
organisations suspected of corruption. This office has the necessary
expertise and experience. Of course this exercise can only be a success if
necessary funding is provided for such a daunting activity.
.. Vote Muza is a legal practitioner with Gutu & Chikowero law firm.
JOHANNESBURG - South Africa's Standard Bank has warned of a
sharp interest rate surge in Zimbabwe in the short term, with more pressure
for higher rates and a depreciating currency in the medium term.
The decline in inflation witnessed last month would slow down and the figure
would start increasing towards the end of the year, the bank said in its
latest overview of the country's inflationary situation released
"Inflation pressures should be re-exerted in
the second half of the year," the bank said.
It said monetary
policy tightening had not been accompanied by fiscal policy tightening,
thanks to the preferential lending scheme at 30 percent. This, Standard Bank
said, undermined monetary policy, with one arm working to reduce inflation
and the other increasing it.
situation was unsustainable and would eventually lead to rapid growth in the
government's domestic debt.
Standard Bank said the discontinuation
of the Reserve Bank of Zimbabwe (RBZ) financial bills had precipitated a
collapse in nominal interest rates from about 300 percent to 20 percent on
the interbank market.
Meanwhile, treasury bills and the 10 percent
compulsory bills were no longer being issued, resulting in a sharp increase
The government had offered into the market two-year
treasury bonds issued at par with a coupon of 150 percent and quarterly
The central bank had also recently signalled its
intention to re-issue RBZ financial bills, but at much lower interest rate,
probably in early May.
"From this information, it is clear monetary
policy stability, as far as interest rates are concerned, is not
"In the short term, we expect interest rates to rise to
150 percent (from current 0-20 percent) in the interbank market in line with
the yield offered by the government when issuing bonds.
"In the medium term, accelerating money supply will exert
pressure for higher interest rates and a depreciating currency," the bank
In his maiden monetary policy review recently, RBZ governor
Gideon Gono gave a clear signal of the central bank's resolve to tame
inflation, saying non-concessionary borrowings on the market were
The RBZ indicated a policy decision to limit
any rate hikes, but keeping them appropriately aligned to prevailing
THE $250 billion
two-year government bond floated two weeks ago only raised $89.5 billion at
the first tender, prompting calls for additional incentives that would enable
money market dealers, who had been sidelined on this issue, to canvass for
support in future.
Dealers said although it was not expected that
the whole amount would be raised in one fell swoop, the fact that the issue
came with no commission for discount houses and other money market
intermediaries had also contributed to the stunted response.
are not canvassing for the bonds because there is nothing in it for us," a
money market dealer told The Financial Gazette last week.
Chideme, an executive director at discount house Highveld Financial Services,
said the decision not to avail commission might have been influenced by the
need to minimise costs.
"Traditionally, we canvass for the funds,
but this time, they removed the commission. They may be trying to minimise
"However, because the amount involved in the bond is high,
we expect them to re-tender. Pension and provident funds will seek to
increase their exposure in line with the prescribed asset ratio
requirements," Chideme said.
Reserve Bank of Zimbabwe (RBZ)
governor Gideon Gono last week issued a stern warning to pension and
provident funds over their prescribed asset obligations.
charged that most of the funds were not in compliance and the authorities
would soon crack down on them.
Pension funds have in the recent
past complained about what they termed high-prescribed asset ratios,
particularly at a time when the prescribed assets such as government stock
and treasury bills were yielding sub-inflationary returns.
assurers, life reinsurers, self-administered pension funds and funeral
assurers have a prescribed asset ratio of 45 percent while non-life assurers
and non-life reinsurers' obligations stand at 30 percent.
players are currently agitating for lower prescribed
As of December 2003, life assurers' asset holdings
averaged nine percent, non-life assurers 31 percent, life reinsurers five
percent, non-life reinsurers 14 percent, funeral assurers 21 percent and
self administered pension funds 19 percent.
The government bond,
which was floated to retire short-term debt, came with several attributes,
among them the fact that the stock qualifies as a prescribed and liquid asset
which can also be used as collateral for repo and overnight accommodation
from the RBZ.
In addition, the stock is exempted from withholding
tax. At the time of the latest floatation, government stocks accounted for
about one percent of domestic government debt, which rose to about $1.5
trillion in March.