The ZIMBABWE Situation
An extensive and up-to-date website containing news, views and links related to ZIMBABWE - a country in crisis
Return to INDEX page
Please note: You need to have 'Active content' enabled in your IE browser in order to see the index of articles on this webpage

Zim hikes fuel price by 1 300%

News24

17/08/2006 19:36  - (SA)

Harare - Zimbabwe has hiked the official price of fuel by more than 1 300%
but this is unlikely to ease shortages of a commodity that has been in short
supply since 1999.

Fuel shortages, a result of a severe foreign currency crunch, alongside food
shortages, rising unemployment and world record inflation of nearly 1 000%
are the most visible signs of an 8-year recession blamed on official
mismanagement.

Energy and power development minister Mike Nyambuya said on Thursday the
price of petrol had been increased from Z$23 (9 US cents) per litre, under
the new system of banknotes, to Z$335 (US$1.34).

The central bank earlier this month slashed three zeros from the country's
currency and introduced re-denominated local dollars to deal with
hyperinflation, which has forced people to carry large piles of cash even
for simple grocery trips.

"It is clear that with the increases of fuel on the international market and
with the movement in our exchange rate ... we should also adjust the price
of fuel," Nyambuya said in remarks broadcast on state television.

Zimbabwe early this month devalued its currency 60%.

The southern African nation has faced intermittent fuel shortages since 1999
due to scarce foreign currency, grounding both private vehicles and public
transport and exacerbating the economic crisis gripping the country.

Although deliveries have improved lately, prices charged by private
importers are still higher than the new official price.

At present, Nyambuya sets fuel prices, but last year started a programme
allowing private importers to buy fuel using their own foreign currency.

Economic analysts say while this has helped improve supplies, it is still
inadequate as Zimbabwe requires about US$45m every month to import fuel for
consumption and strategic reserves.

Under the new currency reforms, the current exchange rate is approximately
US$1 to Z$250.


Click here or ALT-T to return to TOP

Zimbabwe labour union to take bull by the horns

Zim Online

Fri 18 August 2006

      HARARE - The Zimbabwe Congress of Trade Unions (ZCTU) on Thursday said
it had finished consulting general members and its decision-making general
council and would meet "soon" to decide the nature and timing of protests by
workers for better pay and living conditions.

      The ZCTU, the umbrella union body for the country's workers, has since
last July threatened to call nationwide job stoppages but had put the action
on hold to allow for more consultations with workers.

      ZCTU deputy secretary general, Japhet Moyo, told ZimOnline that the
overwhelming response from workers was that labour must "take the bull by
the horns" through protests to force the government and employers to accept
linking wages and salaries to inflation, at 993.6 percent the highest in the
world.

      Moyo said: "Workers are struggling to make ends meet. Their opinion is
that we take the bull by the horns because there is no way the government
and employers will change their policies without workers confronting them."

      He said the ZCTU's management committee will meet tomorrow to compile
feedback from workers into a report to be submitted to the general council
meeting. Moyo did not say when exactly the council - which however normally
meets every month-end - would meet to discuss the issue of protests.

      Tensions have remained high in Zimbabwe since the main opposition
Movement for Democratic Change (MDC) party threatened last March to call
mass protests to force President Robert Mugabe to accept sweeping political
reforms.

      The opposition party, whose protests have been ruthlessly crushed by
state security forces in the past, insists it is still on course to stage
mass protests to force Mugabe to give up power to a transitional government
that should write a new democratic constitution for Zimbabwe and organise
fresh elections under international supervision.

      But Moyo was emphatic that the ZCTU was acting independently of the
MDC, adding that whatever action the union's general council would
eventually decide to take would be purely "worker-based".

      Mugabe has however warned that he will not tolerate protests by the
MDC, ZCTU or whoever, telling hundreds of supporters at a rally in Harare
earlier this week that the army would "pull the trigger" on anyone
attempting to cause unrest in the country.

      Both the ZCTU and the MDC accuse Mugabe of plunging Zimbabwe into its
worst ever economic crisis dramatised by hyperinflation and shortages of
fuel, electricity, essential medicines, hard cash and just about every basic
survival commodity. Mugabe denies mismanaging Zimbabwe.

      Meanwhile, a magistrate's court yesterday granted $2 million ($2 000
revalued) bail to Wellington Chibebe, the secretary general of the ZCTU, who
was arrested and detained by the police earlier this week for allegedly
assaulting a policeman at a roadblock.

      Chibebe, who denies assaulting the police, will appear in court on
September 4 in a case many observers and political analysts say could be
part of attempts by the authorities to derail ZCTU plans to call protests by
workers. - ZimOnline


Click here or ALT-T to return to TOP

Mugabe must bite the bullet and reverse land reforms

Zim Online

Fri 18 August 2006

      BULAWAYO - President Robert Mugabe must bite the bullet by reversing
his farm seizures and re-allocating land only to capable hands - black or
white - if efforts by central bank governor Gideon Gono to resuscitate
Zimbabwe's economy are to succeed, analysts said.

      Agriculture, like in most developing countries, is the backbone of
Zimbabwe's economy. But critics say disruptions caused by Mugabe's chaotic
and often violent seizures of land from white farmers for redistribution
among blacks have hit the once thriving industry, which has plunged nearly
60 percent since land reforms began six years ago.

      The farming sector used to generate 40 percent of the country's export
earnings, from crops like tobacco and horticultural produce.

      Analysts said the government should address niggling problems that
have dogged the agriculture sector since the start of the land reforms, such
as restoring property rights, paying farmers market prices for their produce
and a viable exchange rate for those producing export crops.

      "The land reforms must be reversed if we are to restore property
rights, we need to give back land to those that can produce on a large
scale," Harare-based economic consultant John Robertson said, in reference
to some black farmers who are not fully utilising land seized from whites.

      "We can encourage investment by boosting investor confidence in the
country. The attack on property rights during the land reform resulted in a
flight of investors in all sectors of the economy," added Robertson.

      Critics blame Mugabe's land seizure drive for accelerating the
economic decline, highlighted by the world's highest inflation rate at
nearly 1 000 percent, chronic shortages of foreign exchange, food and fuel,
unemployment around 80 percent and deepening poverty.

      The World Bank says Zimbabwe has the fastest collapsing economy
outside a war zone and its currency is losing value faster than any on
earth.

      Gono, who has been tasked by Mugabe to pull the economy out of the
abyss, announced some radical measures early this month to lift declining
exports and to tame hyperinflation.

      In his monetary policy reforms, Gono devalued the Zimbabwe dollar by
more than 60 percent, cut interest rates and allowed exporters, including
the key gold producers to keep most of their foreign exchange earnings in a
renewed bid to revive the sickly economy.

      But analysts insisted that recovery has to start with improved
agriculture production and a stop to flagrant state spending, which has
pushed money supply growth and inflation.

      Oscar Chiwira, an economist at the National University of Science and
Technology in the second largest city of Bulawayo, said farmers who had
failed to use their land productively should lose it, seemingly echoing
Mugabe's threat last Monday to repossess underutilised land.

      "All that we have to do is to have a land acquisition appraisal
(audit) so as to remove some of the beneficiaries that have failed to make
use of the land," Chiwira said.

      Part of Gono's reforms included knocking off three zeroes from the
country's currency and introducing new bearer cheques, with the switch over
to new currency expected to have been completed by August 21.

      The central bank has gone on a drive to halt money laundering and says
security agents have seized trillions of Zimbabwean dollars in old banknotes
at border posts as launderers tried to smuggle them back from neighbouring
countries where the cash was being used to facilitate illegal foreign
currency trade.

      Chiwira said the government should also address long-standing
grievances of industry in order to increase manufacturing sector production.
Most companies are operating below 30 percent capacity, hamstrung by foreign
currency shortages and high production costs.

      Foreign investors have taken flight from Zimbabwe over failure by
Harare to protect their investments while international donors have stopped
lending to the country over policy differences with Mugabe's government,
such as the land seizures.

      Zimbabwe has a foreign debt of US$4 billion, with more than half of it
already overdue to lenders. The southern African country has twice survived
expulsion from the International Monetary Fund over outstanding arrears.

      The Harare administration's inability to repay loans has seen lines of
credit even for private companies also dry up, hitting expansion plans and
has also seen thousands of workers being laid off as industry battles to
survive.

      "There is also a need to address the demands of industry as it is our
major concern. Inflation and unemployment are just symptoms of a failing
industry," Chiwira said.

      "We need to have two policies for industry and that is industry import
substitution (produce more so that we do not import) and export oriented
industry (produce to export)," he added.

      Mugabe, in power since Zimbabwe's 1980 independence from Britain,
denies charges that he is responsible for the economic meltdown and says
sanctions by Western governments led by London have wobbled the economy. He
charges that his opponents are punishing him for the land seizures, which
displaced more than 3 000 white commercial farmers. - ZimOnline


Click here or ALT-T to return to TOP

Civic groups to petition UN on Zimbabwe crisis

Zim Online

Fri 18 August 2006

      HARARE - A coalition of Zimbabwean civic groups says it will soon
petition the United Nations (UN) to demand that President Robert Mugabe
resolve a six-year old political crisis and end human rights abuses in the
country.

      The Crisis in Zimbabwe Coalition, which groups about 50 civic society
organizations, says the petition is already being circulated among members
of civic groups for signatures in preparation for hand-over to the UN.

      "The UN secretary-general should take responsibility to inform the
world of the reckless and irresponsible actions of the (Zimbabwean)
government.

      "The UN should exert pressure on the government to build bridges with
its own people than with some imagined forces outside Zimbabwe," reads part
of the petition.

      Mugabe last month deftly evaded rising international pressure when he
persuaded UN secretary general Kofi Annan to cancel a planned visit to
Zimbabwe and instead back mediation plans between Harare and former colonial
power Britain.

      The petitioners want Annan to force Mugabe to comply with
recommendations by UN special envoy Anna Tibaijuka on last year's
controversial slum clearing campaign which left at least 700 000 without
shelter or means of livelihood.

      "It has become apparent that despite the UN having sent two envoys to
Zimbabwe on a fact-finding mission, the government of Zimbabwe has not only
ignored the reports and recommendations but has intensified its fight
against the poor," reads the petition.

      A senior official with Crisis Coalition said they expected to collect
about 1 000 signatures before handing the petition to the UN in Harare.

      "We have covered a lot of ground and by mid-September we hope to have
handed over the petition," said the official who refused to be named because
he is not authorised to speak to the press.

      The spokesman for the main faction of the splintered Movement for
Democratic Change (MDC) party, Nelson Chamisa, said his party endorsed the
move by the civic groups and urged their supporters to sign the petition.

      "While we acknowledge that Zimbabweans hold the solution to the
crisis, we are also aware that we need to have the international body taking
a stronger stance against this regime," he said. - ZimOnline


Click here or ALT-T to return to TOP

MDC official attacks Mbeki's new "hands off" approach on Zimbabwe

Zim Online

Fri 18 August 2006

      JOHANNESBURG - A senior official of Zimbabwe's main opposition
Movement for Democratic Change (MDC) party, Eddie Cross, on Thursday
criticised South Africa for propping up President Robert Mugabe's
government.

      Addressing journalists at the Cape Town Press Club yesterday, Cross
said President Thabo Mbeki had effectively adopted a "hands off" approach on
Zimbabwe after he "handed over the baton" to others to deal with the
political impasse in the country.

      The MDC policy adviser said Mbeki must use his influence to push for a
transitional government to oversee internationally supervised elections
leading to the restoration of a legitimate government in Zimbabwe.

      Mbeki and Nigerian leader Olusegun Obasanjo have in the past tried to
broker a political settlement between Mugabe and the MDC. But the attempts
failed after Mugabe refused to play ball.

      Mbeki appears to have given up on Zimbabwe especially after he
attempted last July to rope in United Nations secretary general Kofi Annan
to lead the search for a solution on the crisis in South Africa's northern
neighbour.

      But the Annan initiative suffered a stillbirth after Mugabe told the
UN chief his intervention was not needed because former Tanzanian president
Benjamin Mkapa was already brokering talks between Harare and London.

      Mugabe has always insisted Zimbabwe's crisis is because of a bilateral
dispute with Britain, which he accuses of using its influence on the
international platform to isolate the southern African country and sabotage
its economy. London denies the charge and has also questioned the wisdom of
talks with Harare.

      The MDC came closest to unseating Mugabe's government in elections in
2000 and 2002. But the party, which says it lost in those elections because
of fraud and political violence by the government, appears weaker after
splitting into two rival camps following a dispute between senior leaders
over how to unseat Mugabe. - ZimOnline


Click here or ALT-T to return to TOP

Mugabe to brief SADC leaders on Zimbabwe crisis

Zim Online

Thu 17 August 2006

      JOHANNESBURG - Zimbabwe President Robert Mugabe will on Friday brief
fellow Southern African Development Community (SADC) leaders on measures
being implemented by his government to end his country's seven-year economic
and political crisis.

      SADC heads of government and state are meeting in Lesotho as
burgeoning crises in Zimbabwe and the mountain kingdom of Swaziland appear
increasingly distorting the way foreign investors view the region.

      The regional summit has reserved tomorrow for a special session aimed
at finding ways to help Zimbabwe and Swaziland out of their economic and
political problems.

      Zimbabwe is grappling its worst ever economic crisis marked by the
world's highest inflation of 993.6 percent, shortages of fuel, electricity,
essential medicines, hard cash and just about every basic survival
commodity.

      The crisis has driven hundreds of thousands of Zimbabweans into
neighbouring countries especially South Africa and Botswana putting pressure
in social services in those countries.

      The main opposition Movement for Democratic Change party and Western
governments blame the crisis on repression and wrong policies by Mugabe such
as his seizure of productive farms from whites for redistribution to
landless blacks.

      The farm seizures destabilised the mainstay agricultural sector and
caused severe food shortages after the government failed to give black
villagers resettled on former white farms skills training and inputs support
to maintain production.

      But Mugabe, who has ruled Zimbabwe since the country's 1980
independence from Britain, denies mismanaging the country and says its
problems are because of economic sabotage by Western governments opposed to
his seizure of white land. - ZimOnline


Click here or ALT-T to return to TOP

Zimbabwe not on SADC heads of state agenda



[ This report does not necessarily reflect the views of the United Nations]

JOHANNESBURG , 17 Aug 2006 (IRIN) - Civil society organisations in Southern
Africa have called on the region's leaders to stop ignoring Zimbabwe's
political and economic crisis, saying the 'business as usual' approach is
not working and the region is suffering because of it.

The nongovernmental organisations (NGOs) want to force the Southern African
Development Community (SADC) Heads of State meeting to put Zimbabwe on the
agenda. In a communiqué submitted to the foreign ministers of the 14-member
grouping, NGOs expressed disappointment that successive summits had
consistently ignored Zimbabwe's plight, despite growing evidence of its
regional impact.

The two-day SADC meeting in Lesotho's capital, Maseru, began on Thursday.
The agenda includes items such as the formation of a regional common market,
the re-admission to the body of the Republic of Seychelles, an Indian Ocean
archipelago, HIV/AIDS, avian flu and the 2010 World Cup.

No talks on Zimbabwe's economic meltdown or its repressive security laws
were scheduled, although SADC secretary Salomao Tomaz said the issue of
political stability was a priority.

Once described as the region's breadbasket, unemployment has surpassed 70
percent and inflation is hovering at 1,000 percent. It has been estimated
that around three million Zimbabweans have crossed into South Africa alone,
many illegally, in search of employment.

The Crisis in Zimbabwe Coalition, which comprises about 50 civic
organisations, urged the SADC to promote political dialogue and national
reconciliation, and said regional leaders could not continue to provide
political support for President Robert Mugabe's excesses, as the ruling
Zanu-PF government had flouted SADC protocols, to which it was a signatory.

"The constitutional, legislative and electoral framework in Zimbabwe remains
unchanged. Repressive security and press laws and other pieces of
legislation, prejudicial to freedom of speech, the press, movement and
association, remain on the statute books without amendment," the coalition
said in a statement.

According to Daniel Molokela, a Zimbabwean lawyer, human rights activist and
chairperson of Zimbabwe Civil Society Forum, "The only thing SADC leaders
are likely to do is to adopt Mugabe's choice of [former Tanzanian president
Benjamin] Mkapa as mediator between Zimbabwe and Britain. This is in line
with their long-standing policy of appeasement [of Mugabe]."

He said Zimbabwe's crisis was the result of internal governance, and Mkapa's
focus should be on an exit strategy for Mugabe. The proposed bilateral talks
with the British government would not address the country's real problems.

"SADC leaders can see the effects of the crisis in growing illegal
immigration to their countries, but they are afraid of telling Mugabe to
deal with it or go. They will continue to display a form of solidarity and
praise him - as they have done before - but there is no doubt that many of
them are worried about the Zimbabwe meltdown and its effects," Molokela
said.

SICK MAN OF SADC

A senior regional development planner at SADC's Gaborone regional
headquarters, who declined to be named, said Zimbabwe's "contagion effects"
could not be ignored any more, as they were slowing down regional growth and
integration. "Zimbabwe is the sick man of SADC, the sore thumb in this
region."

The failure to tackle the Zimbabwe crisis was delaying key infrastructural
and economic development projects in the region. He cited the stalling of
three new border posts with Botswana and the construction of the Kazungula
Bridge across the Zambezi River to link Botswana, Zambia and Zimbabwe, as
examples; agriculturally, the whole region was now in a permanent state of
alert to combat Zimbabwe's regular livestock epidemics.

On the fiscal front, all SADC member states except Zimbabwe had tightened
their monetary policies and reduced inflation rates to single digits.
"Zimbabwe is the only one going in the opposite direction. In fact, the
effects of its high inflation on the region are such that the regional
average shot to 23 percent, against a possible 10.8 percent if the country's
high figures were not factored in. We can as well abandon the regional
search for a common currency as long as inflation remains abnormal in one
member state."

Eddie Cross, a policy adviser to the opposition Movement for Democratic
Change (MDC) party, reportedly told Cape Town's press club on Thursday that
the Zimbabwean economy had taken on the dubious mantle of being the world's
most indebted country: it owed US$5.5bn and $2.2bn in arrear payments,
equivalent to two years of the country's gross domestic product. He said
Zimbabwe's crisis had slowed South Africa's growth rate by 2 percent.

Some SADC officials have indicated that although Zimbabwe is not on the
heads of state agenda, it may arise in closed-door sessions.

Zimbabwe's justice, legal and parliamentary affairs minister, Patrick
Chinamasa, told IRIN that the civil society groups in Maseru were "nothing
but running dogs - agents of western imperialism that are working to bring
down the government".

"The so-called petitions and concerns are part of the Western agenda of
regime change - our enemies sponsor them to rubbish the name of this country
whenever they can," he said. "The government is concerned that some of our
neighbours play host to anti-Zimbabwe organisations, and even allow them to
go about disturbing the peace and important proceedings for mean gains.
There is no crisis in Zimbabwe and, therefore, nothing to petition or call
the region to meet about. SADC knows our position."


Click here or ALT-T to return to TOP

Harare Launches Investigation into Maize Crisis

VOA

By Blessing Zulu
      Washington
      16 August 2006

The Zimbabwean government said it is launching an investigation into acute
shortages of maize meal nationwide. Industry and Trade Minister Obert Mpofu
said his staff will look closely at milling companies to find out why the
shortages have developed.

Grain Marketing Board Chief Executive Samuel Muvhuti told the Chronicle
newspaper, a state-controlled publication, that the GMB has blacklisted
agricultural operators who bought maize from the state grain monopoly at the
subsidized rate of $Z600 dollars a metric tonne, then sold it back to the
GMB at the producer price of $Z31,000.

Elsewhere, international donors are investigating reports some government
ministers and top officials of President Robert Mugabe's ruling Zanu PF
party have exported maize to neighboring countries despite domestic
shortages, sources said.

The government has imported maize from South Africa for the equivalent of
US$200 a metric tonne, but sells it through the GMB for $Z600, less than
US$3. Most of it ends up being sold for a huge profit across borders,
according to market sources.

Many Zimbabwean maize producers prefer to sell their grain to parallel
market dealers offering prices much higher than the GMB's official price -
and provide transport.

Independent economist James Jowa says the state must control maize as a
strategic commodity, but recommended that the price structure be constantly
reviewed.

For another perspective, reporter Blessing Zulu of VOA's Studio 7 for
Zimbabwe also interviewed Iraj Abedian, CEO of Pan African advisory services
in Johannesburg, South AFrica, who said the GMB monopoly is exacerbating the
maize crisis.


Click here or ALT-T to return to TOP

MDC: Zim collapse affecting SA economic growth

Mail and Guardian

      Donwald Pressly | Cape Town, South Africa

      17 August 2006 01:57

            The economic collapse of South Africa's neighbouring state,
Zimbabwe, is stripping South Africa of economic growth of about 2% per year,
yet South African President Thabo Mbeki has "handed over the baton" to
others to resolve the political impasse in that country, Zimbabwe opposition
Movement for Democratic Change (MDC) policy adviser and Zimbabwean
businessman Eddie Cross said on Thursday.

            Urging President Mbeki and the ruling African National Congress
to use political and economic leverages to foster a movement to a
transitional government and internationally supervised elections, he said
that while South African and other African countries had watched, Zimbabwe's
economy had taken on the dubious honour of becoming the most-indebted
country in the world.

            It owes $5,5-billion in arrear payments. Argentina, at a
critical phase, had debt of 45% of GDP but Zimbabwe owes two years of GDP.

            From being South Africa's largest trading partner on the African
continent and a key consumer of beneficiated industrial goods, Zimbabwe is
now dependent on aid -- including large quantities of maize -- from South
Africa.

            This has significant ramifications for South Africa, which
should be achieving growth rates of 8% or more to create jobs and reduce
unemployment. Yet South Africa appears to be "propping up" the Zimbabwe
regime.

            He said while South Africa stands back, 1,7-million
Zimbabweans -- many of them orphaned, hungry children who would literally
kill for a cellphone -- are estimated to be in South Africa.

            A further 1 500 Zimbabweans are streaming in every day. South
Africa is reacting by stripping people of their possessions and fruitlessly
deporting them. They simply head straight back.

            Speaking at a Cape Town Press Club breakfast, Cross -- who said
his party had been through every ballot of the 2002 parliamentary election
and found that it had won more than 90 of the 120 parliamentary seats, which
meant that the Mugabe government had been illegitimately in power since
then -- said Zimbabwe had arguably declined faster than any state not at
war.

            Noting that the civic organisations, trade unions and political
organisations are on the brink of carrying out a mass-action campaign
against the government of President Robert Mugabe, he said that his party
has been holding talks with the military and he believed that if there is
conflict on the streets -- with armed security forces facing unarmed
protestors -- the bulk of the military will not kill their own people.

            He is more worried, however, about the reaction of the "highly
politicised" police force and Central Intelligence Organisation (CIO).

            The International Monetary Fund (IMF), he said, has estimated
the budget deficit to be 63% whereas sustainable levels were between about
3% and 5%. Private estimates of inflation are that it is running at 25% a
month.

            This has "a dramatic impact on everyone", he said, warning that
a month-long time frame for conversion of a recently introduced currency
could fuel social unrest.

            He noted that the issuing of this currency -- without even
ruling Zanu-PF Cabinet ministers being forewarned -- meant that all autobank
machines ceased to operate. People either obtain cash directly from the
banks or trade directly on the streets.

            The economic decline has affected women in particular, he said.
The bulk of girls are now unable to go to school and they have a life
expectancy of below 30. Yet no one is focusing on the predicament of
uneducated women in a collapsing economy, he said.

            The Mugabe regime -- where the security mechanisms are now more
powerful than the Cabinet -- has routinely sought to destroy known
opposition hotspots.

            The population has already fallen -- through emigration and
death -- from about 16-million to 10-million people. The collapse of white
commercial farms had little to do with the white farmers and much more to do
with removing 350 000 farm workers who voted against the ruling Zanu-PF.

            He noted, too, that only four of the nine city administrations
that were won by the MDC remained in that party's hands. For example,
Harare, the capital, has been placed under an imposed commissioner although
Bulawayo -- where there was no significant support for Zanu-PF -- remained
under MDC administration.

            Cross, who was once detained by the white Rhodesian regime of
Ian Smith, noted that there were just 20 000 white Zimbabweans left of a
peak white population during Rhodesian rule of about 370 000.

            He said there were just three whites left in the state
administration. There were two white members of Parliament, both from the
MDC. -- I-Net Bridge


Click here or ALT-T to return to TOP

Zimbabweans scramble to get rid of old currency

CNN

Nation's inflation down a bit, but still at 1,000 percent in July

Thursday, August 17, 2006; Posted: 11:38 a.m. EDT (15:38 GMT)

HARARE, Zimbabwe (Reuters) -- Tempers are fraying and panic has crept in as
Zimbabweans scramble for new currency less than a week from a central bank
deadline to phase out old notes it says have been hoarded for the black
market foreign currency trade.

The Reserve Bank gave citizens three weeks, until August 21, to dispose of
old money for re-denominated local dollars introduced partly to deal with
hyperinflation that has forced people to carry large piles of cash even for
simple grocery trips.

Critics say the measures will not ease the plight of Zimbabweans battling
with chronic shortages of foreign currency, fuel, food and over 70 percent
unemployment.

Central bank Governor Gideon Gono knocked three zeros off all banknotes and
devalued the local dollar by 60 percent in a bid to snuff out a thriving
foreign exchange black market, where the exchange rate is nearly three times
the official one.

As the cut-off date loomed on Thursday, an irate woman argued with a cashier
at a Harare supermarket when he gave her change in old notes despite a
central bank directive that shops should now start issuing only new
currency.

"Madam, I am sorry I do not have the new notes to give you, whatever the
Reserve Bank has said. Please understand we are not a bank and can only hand
out what we have," the man said.

The RBZ insists it has printed sufficient new notes to go round, but traders
say very limited amounts are in circulation.

During a trip to a rural district this week, a Reuters correspondent spoke
to villagers still stranded with wads of old notes, unable to travel to
distant banks.

Unsuspecting rural folk have reportedly fallen victim to urbanites who
flocked there to dump old notes in exchange for anything from cattle to
donkey carts and ploughs before news of the currency reforms filtered down.

The Reserve Bank says it has noted "with concern that some major cash movers
in the economy have continued to inject large volumes of the old (notes)
into circulation notwithstanding the bank's call that stakeholders now move
to the new (notes)."

"Instances where some players would collect the new cash from the Reserve
Bank and elect to hoard it at their cash depots, will not be tolerated, and
a bank or non-bank financial institution, caught doing such abortive
practices will be dealt with accordingly," it said in a statement.

Trillions in old notes seized
The central bank says security agents have seized trillions of Zimbabwe
dollars in old banknotes at border posts as money launderers tried to
smuggle it back from neighbouring countries where it was used to facilitate
illegal foreign currency trade.

Police have mounted roadblocks along Zimbabwe's highways, clamping down on
motorists and passengers holding large amounts of cash whose legitimacy they
cannot prove.

The Zimbabwe Congress of Trade Unions said police assaulted and arrested its
secretary-general Wellington Chibebe at one such roadblock after he
questioned the legality of the exercise.

Police said Chibebe was arrested for assaulting an officer.

President Robert Mugabe's government has branded inflation -- still the
highest in the world despite a slight brake to 993.6 percent in July -- and
corruption as the biggest scourges of an economy in its eighth year of
recession.


Click here or ALT-T to return to TOP

Government owes millions for maize as supplies run out



      By Tererai Karimakwenda
      17 August 2006

      As Zimbabweans run around from shop to shop and to black market
vendors looking for scarce maize meal, it has been revealed that the
government owes millions of US dollars to companies that have been supplying
the Grain Marketing Board for years. Former head of the GMB and MDC shadow
agricultural minister Renson Gasela told us the government does not have
enough money to import maize and other basic commodities like fuel. He said
years ago the Mugabe regime stopped using the tender system that requires
contracts to be given to companies that offer the best prices for maize.
Instead they have been getting this essential food staple on credit from
companies that are being paid in bits and pieces.

      Gasela agreed with reports that the situation on the ground is grim.
He explained how there is very little maize in the urban areas and none at
all in the rural communities. He said some farmers in some of the rural
areas harvested nothing this year and the GMB has no reserves. And without
any maize getting to the millers there is no mealie-meal getting to the
shops and to Zimbabweans who rely on it daily.

      Gasela reminded us that last year the government said they expected to
harvest 2.4 million tonnes of maize. Then only last month the finance
minister told a parliamentary portfolio committee that we had harvested just
750,000 tonnes. At that time the government also said the country would
continue to import more maize. Gasela said this is because they already knew
we would not have enough maize.

      It has become a standard operating procedure for government officials
to deny reports of food shortages only to turn around and admit it
indirectly when the situation is critical. Robert Mugabe himself told BBC
news last year the United Nations should stop trying to force feed Zimbabwe
because we had enough food. Then months later the UN revealed it was feeding
millions of Zimbabweans with approval from the government. With the economy
continuing to spiral downward there is no clear plan announced by government
yet as to how they plan to pay for food and fuel and to service the country's
international debts.

      SW Radio Africa Zimbabwe news


Click here or ALT-T to return to TOP

Special session on Zimbabwe, Swaziland at African summit

Reuters

      Thu Aug 17, 2006 4:17 PM GMT

By Ntsau Lekhetho

MASERU (Reuters) - A southern African summit in Lesotho will on Friday hold
a special session seeking to help Zimbabwe and Swaziland out of economic and
political crises that increasingly cloud the regional outlook.

Zimbabwe is battling an eighth year of economic recession critics blame on
the government of President Robert Mugabe, who Lesotho officials say will
brief the 14-member Southern African Development Community on how he is
resolving the issue.

Zimbabwe's problems have led to millions of its people illegally migrating,
largely to neighbouring South Africa, Botswana, Namibia and Zambia but also
to places like the United Kingdom and the United States, fleeing uncertainty
back home.

In Swaziland, King Mswati III has launched a new constitution that he says
guarantees greater freedoms, but it still outlaws political parties and the
king does not tolerate dissent and rides roughshod over the judiciary and an
effective parliament, political analysts say.

"There would be a special session at the close of the summit to discuss
what's going on ... specifically in Zimbabwe and Swaziland," Lesotho Finance
Minister Timothy Thahane told reporters late on Wednesday, without offering
further details.

Botswana President Festus Mogae, in a speech to open the summit on Thursday
, called for greater commitment to SADC's goal of creating a free trade area
by 2008 and customs union by 2010.

He urged SADC members belonging to other regional groups to quit them to
give SADC momentum: "It is of critical importance that member states decide
where they want to belong," he said.

BELOW TARGET GROWTH

SADC's overall economy, buoyed by stellar performances by Angola,
Mozambique, Zambia and South Africa, expanded by around 5 percent in 2005
and is expected to grow by 6 percent in 2006.

But that's still below the 7 percent target set for the region to attain the
United Nations Millennium Development Goals that centre on halving poverty
by 2015, Thahane said.

SADC's chief executive, Tomaz Salamao, said the leaders would review
progress in fighting AIDS, a major development challenge because farm
workers are dying or too sick to tend to crops, hurting overall food
production in the region.

Also on SADC's agenda will be accelerating regional integration to boost its
investment credentials, fighting crime, reducing corruption and ensuring
that bird flu is kept out of the region, Lesotho's Thahane said.

Lesotho, a tiny mountainous kingdom surrounded by South Africa, is tottering
under the weight of hosting one of its biggest ever events. With only two
five-star hotels, it is struggling to find rooms for more than 1,000
visitors expected at the summit.

Lesotho officials were still driving around private homes on Wednesday and
Thursday to ask whether owners could accommodate some delegates at a fee.


Click here or ALT-T to return to TOP

Organized Crime in Zimbabwe

OhMyNews

            'Obi' explains some of the scams used by gangs

            Nelson G. Katsande (NELKA)

           Published 2006-08-17 18:15 (KST)

      Recently there has been a high influx of organized crime in Zimbabwe
and most of it has been blamed on foreigners who use fake identification
papers or entice locals into marriage in order to validate their stay.

      While going undercover to investigate prostitution in Harare I spoke
to a 36-year-old Nigerian who preferred not to reveal his real name.

      He told me that the top five corruption hotspots are: customs and
excise, the passport office, the vehicle and licensing department, the
police service and the local authorities.

      So while the government points the finger at foreigners, government
officials are lining their pockets with ill-gotten wealth, using legitimate
businesses as a cover up for their underhand deals.

      In his public address to the nation on Monday, President Mugabe warned
that he would deal with corruption.

      But with Zimbabwe's law being applied selectively it is yet to be seen
if his speech will be reinforced. Mugabe should realize that charity begins
at home. The Zimbawean people will only be satisfied if, and only if, he
starts scrutinizing those in the top echelons.

      I asked the Nigerian, who we shall call Obi, to elaborate further. The
story he revealed painted an appalling picture of organized crime in
Zimbabwe.

      He said that a Zimbabwean passport was the easiest document to get as
staff in the passport office can be bribed to issue unofficial passports.

      He alleged that most of his friends had illegally obtained passports
from corrupt staff. Furthermore he alleged that only the poor are arrested,
insisting that he had, on several occasions, been released by the police
after paying them huge bribes.

      Obi is part of a gang that terrorizes motorists and businessmen in the
capital. With the help of prostitutes and some corrupt police officers, the
gang pounces on their unsuspecting victims.

      Recently a well known businessman was coerced into parting with a huge
amount of money after he was approached by a prostitute offering cheap sex.
They drove to the woman's house whereupon the gang pounced on him.

      As the two undressed, there was a knock on the door. The woman
pretended to panic, informing the businessman that her husband had just come
from a business trip. She opened the door and the gang confronted him with
the accusation that he was having an affair with a married woman. The
unsuspecting businessman panicked and was coerced into paying a huge amount
of money as compensation.

      The gang then shared the illicit proceeds amongst themselves. In cases
like these corrupt police officers, too, usually get their share of the
spoils. The case goes unreported as the businessman would want to protect
his identity.

      Another trick played by these gangs is where a prostitute is used to
pose as a hitchhiker.

      The unsuspecting motorists stop to offer help. Half way through the
journey, she asks the motorist to stop at a secluded place as she wants to
relieve herself. As he stops, the gang pounces and demand that the driver
hands over all the cash he has. In some cases, he is tied to a tree and they
get away with his car.

      With Zimbabwe's prisons overcrowded, the most dangerous criminals are
just left to roam the streets. Prison inmates are packed into squalid and
filthy cells with the majority suffering from chronic illness such as
tuberculosis and HIV. Prison guards also divert food and goods meant for
prisoners and sell them on the black market.

      Poverty and high unemployment levels have resulted in an alarming
increase in crime.

      Police officers are even demanding bribes to attend to crime scenes
and in Chakari, south-west of Harare, they are engaging in illegal gold
panning so as to supplement their meagre salaries.

      The people are disillusioned and keep asking:

      "Who will police the police?"


Click here or ALT-T to return to TOP

Gono accuses banks of sabotaging currency reforms

New Zimbabwe

By Lebo Nkatazo
Last updated: 08/17/2006 19:04:03
ZIMBABWE'S powerful central bank governor Gideon Gono this week fell short
of accusing some financial institutions of sabotaging his new currency
reforms.

Gono claimed in a statement that some banks were trying to discredit his
policy of phasing out the country's old currency by August 21 through
continuous offloading of the old bearer cheques onto the market.

Economic watchers say Gono's new warnings to banks betray serious concerns
within the Reserve Bank of Zimbabwe about meeting the deadline for phasing
out the old currency which is the centre piece of Gono's new reforms to
rally a struggling economy and contain rampant inflation of 1 000%.

In a statement made available Wednesday night, Gono said: " The Reserve Bank
has noted with concern that some major cash movers in the economy have
continued to inject large volumes of the old bearer cheques into circulation
not withstanding the bank's call that stakeholders now move to the new
family of bearer cheques."

This, Gono said, was a flagrant defiance of his policy directive to all
banks to cease the issuance of the old bearer cheques by August 14.

He said: "In order to ensure smooth finality to the changeover process, the
Reserve Bank issued a directive to all players in the financial sector which
closed the issuance of old bearer cheques to the public by banks and other
non-bank financial institutions with effect from 14th August 2006."

Gono's statement came as President Robert Mugabe warned people opposed to
the currency reforms. Senior cabinet ministers are reportedly targeting Gono
for threatening their business interests.

Addressing people gathered at the Heroes Acre Tuesday, Mugabe blasted:
"These economic saboteurs and enemies of our economic turnaround strategy
should take heed that we are determined to fight the scourge of corruption
and do honour to the integrity of our nation".

Zimbabwe's economy has shrunk by 40 percent in the last eight years.

Gono, an energetic banker whose rise to become one of Mugabe's most trusted
lieutenants is worrying Mugabe's allies, is now regarded as the most
powerful man after Mugabe.


Click here or ALT-T to return to TOP

From new farmers to squatters

New Zimbabwe

By Phillan Zamchiya
Last updated: 08/17/2006 18:33:58
ROBERT Mugabe's daring threats on fresh farm seizures during the Heroes' Day
commemoration only serve to confirm the quagmire we find ourselves in
following the erosion of property rights from our laws.

Our celebrated heroes did not wage the war so that Mugabe can willy nilly
possess and repossess land like the possessed. There are various reasons as
to why there has been no significant production on our farms which needs to
be addressed but we can not also just ignore the rights issues.

Mugabe is reliving the legacy of the white colonial settler by promoting
nonexistent distribution of property rights to blacks. The liberation
fighters waged the struggle so that the final means of conquest for the
daughters and sons of Zimbabwe be law and not war.

For a farmer to be able to do her best on land she needs to be guaranteed
that if she plants maize, she will own the produce. Now such threatening
statements of evictions from the head of state will exacerbate the
uncertainty of farmers on whether they have a right to reap the harvest if
they invest in the crops. Farmers need rights so that they can feel secure
and are able to contribute freely without fears from the powers that be.
Failure to address this will mean that we remain "food beggars" to borrow
Uncle Bob's words.

If Gideon Gono with Mugabe's (un)holy blessings had the audacity to command
the unruly Border Gezi youths to seize indiscriminately the poor people's
hard earned cash ,what guarantee is there that Joseph Made will not be
sanctioned to unscrupulously seize the poor farmer's grain? The farmers are
living in constant fear including those closely connected to the so called
presidium because of the nature of its unpredictability buttressed in the
lack of any recourse to shield and sword laws.

The Heroes' Day threats do nothing to mitigate the situation. Given the
people's fresh memories of the sponsored violent invasions and harvest
seizures it is a foregone conclusion that the Government only has to sharpen
its food begging skills. There is a danger that the nation will retrogress
towards the ages of shifting cultivation.

Even the satanic Operation Murambatsvina could have been averted if the
Government had the people at heart by merely formalising the occupants'
rights. Formalisation of informality is being made the whole of Africa. In
Tanzania, since July 2004, squatter rights for 5000 plots of unplanned
settlements have been formalised and there are even plans to cover the
remaining 400,000 parts in Dar-es-slaam. The occupants are now entitled to
compensation if evicted by the state. Thus the people are secure and willing
to invest their energies towards nation building.

Whereas there is no international legal right to land, for the poor majority
it is a fundamental livelihood asset. For the land to be of asset there need
to be land rights defined in a pro-poor paradigm. There is need to base
entitlements in rights rather than discretionary policy. Land rights should
be enforceable.

Farmers' rights should provide tenure security and this will make a benefit
stream to be established as a right and hence difficult to have it
re-captured. Strengthening and providing tenure security will secure rights
to land, encourage investment and aim at breaking down the traditional
patronage ownership. It is not enough for benefits to flow only from policy
interpretation. If they are not firmly anchored in rights, the benefits can
be re-routed away and hence farmers are not secure enough to commit to
intensive production and investment.

Tenure rights should also be enshrined as they give tenants the right to
occupy land and security which enables them to develop the land. Farm
workers who have the experience and necessary acquired skills in farming can
be retained in this way. This is the case with the Labour Tenants Act in
South Africa which has sought for land to be transferred to the tenant
outright. This is significant as it reinforces labour tenancy as a strong,
secure and unique land right and thus enable protection of farm workers as
well as utilizing their abilities for national development and black self
empowerment.

The regime must also know that real farmers cannot be fooled by the so
called leases being issued by the state. The current leases are not even
worth the papers that they are written on and are a source of more confusion
and controversy rather than security. The 99-year leasehold can not in any
way create secure property rights out of an insecure environment. Granting
and protecting rights involves major political, social, economic and legal
reform. The so called leaseholds under the current political gangsterism
have only exacerbated corruption by Zanu PF fat cats who are using their
political influence to seize the deeds, in some cases confiscating the
existing customary property rights of poor communities and violating
bilateral agreements.

To safeguard the future, our kith and kin in the rural areas need protection
from this madness which in no time will reach out to them the moment they
dump the gravy train. Despite the fact that customary land tenure is
recognized there is need to strengthen protection of their rights. In
Madagascar, a new national land policy provides for the creation of land
certificates provided by the commune. Nevertheless efforts to strengthen
customary rights must pay close attention to other risks such as the
management of land being in hands of traditional leaders who could abuse the
system as is already happening in Zimbabwe and there should be room to adapt
to situational changes. Even when land rights are allocated communally to
protect indigenous rights there is need to have institutions that protect
legal recognition and enforcement of community rights.

The ultimate ideal will be for property rights to provide solutions as
capital assets. Land rights will give the additional protection that
beneficiaries need and this type of approach may protect them from the
Government because customary tenure may not be enough to protect
beneficiaries from re-capture of their land especially as political dynamics
intensify. A better approach to land rights would be to assist existing
systems, by promoting and providing legislative protection to existing
rights and then systematically move to titling.

The Land rights component should emphasize on good governance and
accountability. The law must empower marginalized groups to be able to
resist inappropriate changes to land use from the powers that be. There is
need to safeguard existing diverse rights and ensure that they are built
into law. With only redistribution of land and without redistribution of
land rights the few deserving beneficiaries who moved from being squatters
to landowners are now evidently moving from being landowners to squatters on
the land.

Zimbabwe should reflect on the existing property rights and democratically
make decisions about the distributions. History has proved that it is
precarious to national economies to dilly dally on the issue of rights.
Addressing this issue in the context of others will contribute to long term
focus on development; however it remains a tall order without addressing the
broad twin towers of constitutionalism and legitimacy.

Zamchiya is a former student leader and political activist. He writes from
South Africa

Back to the Top
Back to Index