Thursday, 15 December 2011 16:43
ZANU PF has failed to meet its target of securing at least 1,27 million
members in 2011 ahead of crucial general elections the party is pushing for
next year. According to the party’s central committee report tabled at the
party’s national conference in Bulawayo last week, Zanu PF only managed to
achieve half of the 1,27 million new membership cards it intended to sell to
shore up its dwindling support base.
The report said the party sold a total of 653 950 membership cards in the
past two years, in addition to its 579 312 paid-up members as shown after
the verification exercise.
Zanu PF has embarked on an intensive mobilisation drive by employing various
strategies to resuscitate its structures, which have been ravaged by rampant
Zanu PF national commissar Webster Shamu has said the party’s grassroots
structures countrywide were in shambles and the party was currently working
flat out to avoid an embarrassing defeat in elections.
He said the party had failed to meet a March 2011 deadline to re-organise
its structures right from the village and cell levels due to lack of
resources. In February 2010, President Robert Mugabe told an extraordinary
session of the party’s central committee that reorganisation of grassroots
structures was one of the biggest challenges facing the party.
The Matabeleland provinces, which are an MDC-T stronghold, sold the lowest
number of Zanu PF membership cards. Bulawayo sold 9 810 cards out of 35 000
disbursed to the province in 2010; Matabeleland South sold 13 367 out of 29
800 and Matabeleland North 8 639 out of 35 000.
The province with the highest number of membership cards sold was Midlands
with 186 200 out of 280 480, followed by Mashonaland East with 170 326 out
of 295 580 and Harare with 96 955 out of 221 160.
Manicaland province managed to sell 57 885 out of 132 140, Masvingo 30 890
out of the 61 500 and Mashonaland Central 27 634 out of 67 000.
Zanu PF also carried out a membership verification, fees and subscriptions
to establish its membership figures.
Mashonaland Central, which has the highest Zanu PF voters, had one of the
lowest numbers of people with membership cards. It has 18 730 members, while
Bulawayo has 13 725, Matabeleland North 11 153, Matabeleland South 17 046,
Masvingo 22 868, Manicaland 50 511, Mashonaland West 46 718, Harare 131 331,
Mashonaland East 101 198 and Midlands 166 032.
“The verification teams observed that some provinces are not adhering to the
distribution system and are holding on to stocks of membership card s,”
read the report.
Zanu PF’s main source of revenue for 2011 was membership and subscriptions,
a government grant, donations and investments. It had an income of US$4 094
The party received US$579 312 from membership fees and subscriptions, US$2,9
million from the government grant, US$304 849 from donations and US$280 624
from its investments. However, its expenditure of US$6 229 397 was higher
than its income, and as a result, the party continued to rely on bank
overdrafts whose interest rates and establishment fees are costly. Bank
charges totaled US$607 817.
Most of the money raised went to salaries, whose bill was US$1,9 million,
followed by constitutional meetings, such as the politburo and central
committee meetings, which cost US$601 149.
Politburo meetings, which are normally held once a month, cost US$172 652,
while central committee meetings cost US$157 640.
The party has resolved to target businesspeople, churches, the youth,
traditional leaders, women and urban dwellers as it intensifies its campaign
to win the next elections.
Government has set up a Youth Empowerment Fund administered by minister of
Youth Development, Indigenisation and Empowerment Savior Kasukuwere, who is
also Zanu PF’s secretary for indigenisation and economic empowerment.
The report said Zanu PF was targeting the youth vote by providing them with
a loan facility through the Youth Empowerment Fund.
Kasukuwere said the fund was allocated US$1 million in 2011, while
additional funding of US$1 million was expected from the National Social
Security Authority, US$5 million from Essar Africa Holdings and US$10
million from Old Mutual.
Thursday, 15 December 2011 16:37
Owen Gagare in Beijing
CHINA has said it will continue supporting Zimbabwe and other developing
nations which it believes are being unfairly treated by the West. The
vice-minister for the State Council Information Office Wang Zhongwei told
Zimbabwean journalists in China this week that the communist state
sympathised with countries which have been accused of human rights
violations and stifling democracy and the rule of law.
Zhongwei said China, whose human rights record has often been criticised,
believed it was not upto Western nations to impose rules on the rest of the
world. He also accused the West and its bodies, such as the International
Criminal Court, of double standards when dealing with human rights records.
“I believe every country has its problems, from America to Europeto Asia…so
I don’t think we should lecture each other on how to do business,” said
“The Chinese policy has been consistent. We are opposed to double standards
taken by the ICC on many issues including human rights. Many Western
countries criticise China for opposing human rights, democracy and the rule
of law, but we say no, we are opposed to double standards.We are opposed to
the Western countries writing rules for the world to play by.”
Wang said Zimbabwe and other developing countries played a crucial role in
forcing the United Nations to give China a permanent seat on the Security
Council. China is one of the five permanent members of the Security Council,
alongside the United States, Russia, the United Kingdom and France.
In 2008, China and Russia used their veto power to block an attempt by the
Security Council to slap Zimbabwe with sanctions after violence marred
He said China, like Zimbabwe and other developing countries, had suffered
years of foreign aggression and, therefore, they needed to cooperate.
On climate change, Zhongwei said industrialised countries should take the
leading role in reducing emissions.
“Nowadays we are talking about reducing carbon emissions, but we are saying
we should differentiate between necessity based emissions and luxury based
emissions. Africa and China are emitting because they are developing, which
is justified but developed countries are emitting because of luxuries.Larger
countries with more emissions should show more commitment.”
However, Zhongwei said his country had taken measures to reduce carbon
emissions by investing in new sources of energy, such as solar, energy
saving material for buildings, setting low temperatures in offices, phasing
out energy consuming industries “at the cost of employment”, among other
“We are not doing it for the rest of the world, we are doing it for China
because we want our air and water to be clean,” he said.
The Chinese government was hosting Zimbabwean journalists as part of a
strategy to strengthen media relationships with local journalists. The
Chinese have also hosted journalists and information officers from several
developing countries in Asia and Africa to give them the “true” Chinese
story which officials feel has been twisted by the Western media.
Thursday, 15 December 2011 16:36
ZAPU is on a collision course with the police in Bulawayo tomorrow when the
party holds jubilee celebrations marking the 50th anniversary of the party
as law enforcement agents have threatened to cut short the event. Zapu
spokesman Methuseli Moyo said about 35 000 delegates would gather at
Barbourfields Stadium from morning until midnight, but police had ordered
the party to assemble only up to 4pm.
He said they had received correspondence from the police notifying the party
of the approved timelines of the event.
Zapu was formed by the late former vice-president Joshua Nkomo in 1961 and
spearheaded the fight against colonialism together with its offshoot Zanu
leading to Indepedence from Britain in 1980.
Zapu was eventually collapsed into Zanu PF on December 22 1987 when Nkomo
signed a unity accord with President Robert Mugabe’s party.
Former Zipra intelligence chief and Zanu PF politburo heavyweight Dumiso
Dabengwa and the late Thenjiwe Lesabe pulled out of Zanu PF in 2009 to
revive Zapu citing Mugabe’s misrule.
Moyo said his party was not happy with the police’s stance to impose
timelines of the celebrations saying Zanu PF held a 22-hour unity gig at
White City Stadium last weekend.
“We are made to suffer because we are opposition. We are definitely not
happy at all about the time given by the police. Why shouldn’t we be allowed
to finish at our own time just as Zanu PF did on Saturday?” queried Moyo.
Some Zapu officials believe that police were likely to clash with party
supporters drawn from across the country if they attempted to break up the
Zapu is at loggerheads with Zanu PF which it accuses of orchestrating the
Gukurahundi massacres in the 1980s.
“Today, we declare that the people’s grief and suffering was not in vain.
Their Zapu is back, and back for good,” said Moyo.
Zapuinvited other southern African liberation movements such as the ANC,
MPLA, Frelimo and Swapo and governments and political parties from
neighbouring states for the gig.
Thursday, 15 December 2011 16:33
ZANU PF’s doublespeak was exposed at its annual conference in Bulawayo last
week when it passed a resolution ordering a crackdown on social media, such
as Facebook, Twitter, My Space, among others. The resolution is contrary to
the party central committee’s recommendation proposing the increased usage
of new media for Zanu PF to reach its membership in the Generation 40
In the report tabled by President Robert Mugabe during the conference, the
party’s science and technology department said: “If platforms for
disseminating information about the party and its policies are not in sync
with modern trends, the party may not strike a chord with the majority of
the electorate who are under 40 years of age. Rallies and gatherings as a
source for disseminating information are now very limited and limiting the
scope and geographic spread.”
However, Zanu PF secretary for legal affairs Emmerson Mnangagwa read out the
conference resolution to tighten screws on the use of social media,
highlighting that the Arab Spring revolutions were driven by new media.
The Arab Spring swept away the long-serving dictatorships of Tunisia, Egypt
and Libya through mass uprisings mainly coordinated through Twitter and
Mnangagwa said social networks had been used with devastating results in the
United Kingdom riots and the ongoing Occupy Wall Street campaigns in the
United States and should, therefore, be further controlled if peace was to
be guaranteed in the country.
The party’s science and technology department’s observations are in sync
with the mobile penetration rate in Zimbabwe where more than seven million
people are connected.
Zimbabwe has witnessed an increased usage of data services after Econet,
Telecel and NetOne introduced the service enabling people to access the
Internet on their mobile phones.
The mobile penetration has been further boosted by zero rate customs duty on
imported mobile phones and accessories and the availability of Chinese made
cheap low-end market smartphones.
Ironically, Zanu PF youths and technology savvy MPs have opened Twitter and
Facebook accounts where they engage with their constituencies. Noticeable
among them are Youth, Indigenisation and Empowerment minister Saviour
Kasukuwere, his brother Tongai Kasukuwere, Tourism minister Walter Mzembi
and outspoken MP Edward Chindori-Chininga.
Former Information minister Jonathan Moyo has become a prolific blogger on a
number of websites where he espouses Zanu PF policies and denigrates its
opponents, particularly MDC-T leader Morgan Tsvangirai.
The central committee report ominously warns that for the party “to remain a
political giant and retain competitiveness, Zanu PF has to take ICTs
seriously for political mobilisation”.
Zanu PF has maintained a media stranglehold since Independence as evidenced
by its decline to license private broadcasters in the past 31 years,
enactment of draconian legislation, such as the Public Order and Security
Act, Access to Information and Protection of Privacy Act and the
Interception of Communication and Information Act.
Party deputy national spokesperson Cain Mathema said Zanu PF expected the
coalition government to implement its conference resolutions.
“It does not matter we are in a coalition government. The government has to
implement the conference resolutions just like any other coalition operates
for instance in Israel and the United Kingdom,” Mathema told the Zimbabwe
Independent this week.
Thursday, 15 December 2011 16:32
TRACY Mutinhiri’s term as a deputy minister legally ended this week after
expiry of the 90-day period in which she could remain in the post without
securing a parliamentary seat following her expulsion from Zanu PF in
September. President Robert Mugabe is reportedly reluctant to replace her
and is using such vacancies, as well as in the Zanu PF politburo, to contain
factionalism and maintain his grip on power.
Mutinhiri, who was the Labour and Social Welfare deputy minister, was
expelled from Zanu PF after being found guilty of bringing the party’s name
into disrepute and ridicule through improperly associating with members of
Despite her expulsion from Zanu PF, Mutinhiri continued to enjoy the perks
and benefits of the office of deputy minister since Mugabe did not fire her
and she did not resign from government.
“The matter is for the president to pronounce,” Mutinhiri told the Zimbabwe
Independent this week. “Under these difficult circumstances I have taken a
deliberate stance not to comment on the matter for I believe silence is
golden. The issue is between me and the president.”
Zanu PF insiders confirmed that Mugabe’s reluctance to immediately wield the
axe was informed by his attempt to manage intense factionalism.
“Mugabe has been hamstrung to make a decision that would be interpreted
within the party as supporting either of the two main factions in Zanu PF by
appointing a replacement just before elections next year,” one of the
Mugabe confirmed the deep rooted factionalism in Zanu PF at last week’s
annual conference in Bulawayo.
Mugabe’s non-appointment of politburo members to replace deceased members
that was widely expected to be done on the closing day of the three day
conference further signalled the aging leader’s cunning approach to contain
factionalism in the party.
“Any new appointments to the politburo would have tilted the balance of
power in favour of either the (Joice) Mujuru or (Emmerson) Mnangagwa
factions. To that end, Mugabe left the posts open until after the
anticipated elections for fear of further tearing the party,” the insider
Mugabe was widely expected to announce replacements for deceased politburo
members Solomon Mujuru, David Karimanzira, Kantibhai Patel and Ephraim
Zanu PF deputy spokesperson Cain Mathema told the Independent this week that
reasons for not co-opting new politburo members at the conference were not
for public consumption.
“It is an internal issue and that’s all,” Mathema said.— Staff Writer.
Thursday, 15 December 2011 16:31
THE annual Zanu PF conference held in Bulawayo last week turned out to be
just another jamboree where the party’s privileged elite jostled to flaunt
their wealth. Bulawayo is a conservative and sleepy city and its residents
are highly reluctant to display their wealth. But for about a week with Zanu
PF in town it turned into anmotor show with the latest SUV vehicles lining
the city’s streets as Zanu PF officials sought to prove the benefits of the
party’s empowerment drive.
While the political elite was predominant in the streets of the city of
kings, the conference itself demonstrated a poverty of ideas with every
speaker delivering long, dull and dry speeches.
President Robert Mugabe once again delivered a familiar long, old and
backward looking speech attacking Western imperialism and past injustices,
and not offering any hope for the suffering masses.
Mugabe assured his supporters that his party would force all mining houses
operating in the country to cede controlling stakes to locals. The locals
Mugabe was referring to are all Zanu PF connected individuals, who were all
present at the party’s talk show.
To the delight of his audience, Mugabe seemed to all but banish foreign
direct investment by suggesting that even by demanding 51% shares to be
surrendered to locals, the government was being generous, and hinted that as
long as he remained at the helm, foreign shareholding might be further
reduced from the present 49%.
However, all was not smooth sailing at the conference as reports emerged
that a number of disgruntled and underprivileged Zanu PF members boycotted
Youth and Indigenisation minister Saviour Kasukuwere’s presentation on the
indigenisation and empowerment policy accusing him of pushing for
Mugabe argued that Zanu PF had developed the policy of indigenisation and
economic empowerment well before the present coalition government and the
party would beits sole defender against any and all odds.
Already, some mining giants, such as Zimplats and Unki, have been coerced
into ceding a 10% stake to the controversial community share ownership
programme launched recently.
The Anglo-American owned Unki mine, whichextracts platinum along the Great
Dyke belt, donated 10% of its stake to the Shurugwi community, while
Zimplatssurrendered 10% to the Mhondoro-Ngezi community in Selous.
Old Mutual and Meikles Ltd have also set up employee trusts and other trusts
and community share ownership schemes should be announced soon as corporates
seek to appease Zanu PF and avoid becoming targets of a complete takeover.
However, analyst Chamu Mutasa dismissed the empowerment drive as an
electioneering gimmick meant to only benefit known Zanu PF supporters.
The MDC formations have strongly criticised the indigenisation policy saying
it scared away investors who are needed to inject capital in the ravaged
Mutasa argued that Mugabe and Zanu PF were a sunset party which would do
anything to lure the increasingly discontented electorate.
“Zanu PF is known for using such tactics of forcing companies into complying
with certain policies for its selfish reasons,” said Mutasa. “The whole
debate around indigenisation is building an electoral base,” he said.
The Indigenisation and Empowerment Act was passed last year, but concerns
are growing on its impact on potential investors. However, the concern has
fallen on deaf ears since Mugabe said the economy would never collapse
because of the empowerment policy.
‘It does not make sense that today we fear to enforce our indigenisation
policy on grounds that the economy will collapse. We faced similar dire
predictions during our land reform programme. We executed it regardless,”
In its conference resolutions, Zanu PF affirmed that the indigenisation
policy was there to stay and would benefit everyone in a transparent manner.
Mugabe, who was expected to tackle sensitive issues, like leaked WikiLeaks,
cables in which several senior party officials expressed frustration at his
continued stay and the appointment of politburo and central committee
members,he completely ignored them to maintain his grip on the party.
Thursday, 15 December 2011 16:29
THE African National Congress (ANC)’s backing for Zanu PF in elections next
year or in 2013 is a demonstration that former liberation parties that waged
guerrilla wars do not want to see other liberation movements losing power,
but analysts do not believe there will be an economic meltdown if President
Robert Mugabe has another term in office. This is the view of South African
political economist Steven Friedman, who said the ANC did not feel
comfortable with former guerrilla movements like the MPLA in Angola, Zanu PF
in Zimbabwe, Frelimo in Mozambique and Swapo in Namibia losing political
ground, but Cosatu spokesman Patrick Craven said propping up Mugabe for
another term would be disastrous for workers.
ANC secretary-general Gwede Mantashe committed his party to support Zanu PF
at its annual national conference in Bulawayo last week. He said the ANC and
Zanu PF belonged together, and that Zanu PF should regain its lost ground
with the ANC’s help.
Craven said Cosatu stuck by its existing position on Zimbabwe. “We do not
support Zanu PF or Robert Mugabe.” While the ANC had historically supported
Zanu PF “and clearly they have not changed their policy… we will have to
disagree with them on that, they have the right to adopt a different policy”.
This support was “unfortunate”, Craven said, given the policies at play in
Zimbabwe “particularly towards workers and farm workers… who have suffered
under the Mugabe government”.
“It would be unfortunate if the period of Zanu-PF rule was prolonged,
delaying the transition to “a genuinely democratic government”, Craven said.
Friedman said he suspected that the ANC wanted the Zanu PF and MDC
formations’ unity government to remain in place or better still, for Zanu PF
to win outright.
Friedman said South Africa’s foreign policy was largely supportive of the
status quo: “There is a simple reason for this — the idea of a former
liberation movement losing an election to an opposition party is not
something with which the ANC is very comfortable.”
The consequence of propping up the Mugabe government actually meant that the
police and army generals were propped up.
But Friedman believed “there won’t be a meltdown” with a surge of
Zimbabweans fleeing to South Africa. Even if this were to occur, they tended
to be the more entrepreneurial people who created work and opportunities in
Economist Colen Garrow said the end of Mugabe’s rule would unleash an
economic boom, with the construction industry, in particular, being boosted
with repairs to unmaintained infrastructure commencing.
Backing Mugabe was a classic case of liberation politics. “Isn’t that what
politics is about… it doesn’t make sense at times,” Garrow said.
Dennis Dykes, Nedbank’s chief economist, said Mantashe’s stance was “not
particularly a new position” on Zimbabwe, but he would have liked to see a
pledge in support of democracy “rather than a particular government”. —
Thursday, 15 December 2011 14:58
RIOZIM Ltd is projecting a US$8,7 million loss before tax in the full year
to December 2011 after incurring finance costs of US$12,2 million, FD
Emmerson Mungwariri said. Mungwariri told shareholders at last week’s
Extraordinary General Meeting that finance costs consumed most of the
application of the debt as compared to capital projects.
“Finance charges consumed most of the application of debt and little was
channeled towards capital projects,” said Mungwariri.
In 2009, a total of US$4,3 million financed interest charges while US$3,7
million went towards capital projects.
The scenario worsened in 2010 and 2011 where US$10,2 million and US$12,2
million, respectively, was consumed by finance charges.
Because of the short-term nature of the loans, RioZim management borrowed to
pay interest as compared to investment in capital projects and this stalled
resuscitation of the group’s mining operations.
The mining giant is currently facing viability problems and is sitting on a
historical debt of about US$57 million. A plan to retire the mounting debt
through a rights issue and a debt-to-equity conversion was rejected by
shareholders last week.
“It is common knowledge that RioZim is heavily borrowed and this is
threatening the going concern status of the group. The company is
technically insolvent but the balance sheet does not fully capture the
assets of the group,” said Mungwariri.
The company indicated that the current total debt of US$57 million comprises
of US$30,15 million plus the interest component of US$26,85 million. In the
full year to 2010, total borrowings amounted to US$49 million, with the
principal at US$34 million and interest of US$15 million.
The company caught up in a debt trap since the outstanding amounts ballooned
given the high cost of funds during the time of borrowing.
In mining, the turnaround or payback period is usually long and the returns
on capital projects require long-term financing.
Analysts believe RioZim would not have survived the vicious cycle of
short-term loans available in the local market post dollarisation.
Others feel that the company lacked sound financial advice but blame
management’s huge appetite for debt and a lack of vision on the direction of
Interest rates have since gone down to levels of around 15-20% compared to
levels of around 50% post dollarisation.
“RioZim management should have thoroughly evaluated all possible financing
options before diving into the current debt trap since the operating
environment was now stable as compared to the hyperinflation era,” an
Other mining companies like Bindura Nickel Corporation have been put under
care and maintenance and the company’s management is still wary of funding
choices given the economic and political environment in the country.
RioZim management was hopeful of turning around the situation by end of 2012
had the proposed rights issue and the debt-to-equity swap deals gone
The company expected to post a US$5,7 million profit by December 2012. On
operations, Renco needs about US$4 million to be channeled towards
development work. The gold mine is expected to produce about 19 713 ounces
in the full year to December 2011 with the cost per ounce expected to be
US$1 000 per ounce.
At Empress Nickel Refinery, capital expenditure of US$4,5 million is
required and will be used to increase efficiencies and uptime.
The nickel refiner is sitting on trade debtors of US$45 million in the form
of metal-in-process, acquired three years ago and cannot be immediately
converted into cash.
Murowa Diamonds is expected to rake in revenue of US$85 million since the
mine is currently producing a rich resource which is profitable.
RioZim holds a 22% stake and operating profit is forecast at US$4,3 million
Thursday, 15 December 2011 14:52
AIR ZIMBABWE has suspended flights to Johannesburg amid reports that one of
its creditors — Bid Air Services — plans to attach the national airline’s
planes over a US$500 000 debt. Air Zimbabwe which flies to South Africa
twice daily last flew to the destination on Thursday last week.
This comes after a United States company — American General Supplies —
attached Air Zimbabwe’s Boeing 737-500 this week in London over a reported
US$1 million debt.
Insiders said Air Zimbabwe’s Boeing 737-500 was nearly impounded at OR Tambo
International Airport in Jo’burg, by Bid Air Service officials over the
Air Zimbabwe chairman Jonathan Kadzura confirmed this week that the national
airliner would not be flying to South Africa until the debt has been
“At the moment we doubt if we will be flying to Johannesburg and would not
want to say when we expect to fly again because it might not happen,”
Kadzura said. “They (Bid Air Services) are not servicing us because we have
not paid them and they want their money.”
Kadzura could not comment on the planned action by Bid Air Services should
Air Zimbabwe land at OR Tambo International Airport.
Observers say Air Zimbabwe faces collapse if the shareholder — government —
does not chip in and re-capitalise the loss-making national carrier. Other
efforts to have government chip in to rescue Air Zimbabwe have been rejected
by Finance minister Tendai Biti.
The airline, currently saddled with debts amounting to more than US$100
million, has been battling intermittent strikes by pilots since the country
adopted multiple currencies in February 2009.
Last month Air Zimbabwe passengers in Harare, Beijing, Kuala Lumpur and
London were left stranded after the national airliner cancelled flights
following its failure to procure fuel.
Airline officials told businessdigest that the national carrier was
struggling to buy fuel.
“Air Zimbabwe is failing to pay for fuel, forcing suppliers, who are owed in
excess of US$1 million, not to deliver the commodity occasionally,” said an
The airline has six operational aircraft; threeBoeing 737s, two Boeing 767s
and one MA60, with analysts estimating the combined value of the planes at
less than US$119 million dollars.
One of the Boeing 737s is currently under maintenance. Despite the dire
financial stress, Air Zimbabwe management insist they are committed to
revamping operations at the airline, one of the 10 state enterprises
earmarked for either privatisation or restructuring.
“We should all be responsible at Air Zimbabwe, that is the only way we can
revive the national airline,” Kadzura said.
A total of 18 international airlines have left the country since the
economic crisis when negative publicity about Zimbabwe started 10 years ago.
These include Lufthansa, Qantas, Austrian Airlines, Swissair, Air India, Air
France and TAP Air Portugal.
African airlines that no longer fly into Harare include Egyptair, Air
Mauritius, Linhas Aereas de Mocambique, Air Namibia, Royal Swazi Airlines
and Air Seychelles. Air Tanzania, Ghana Airways, Air Uganda and Air Cameroon
have also pulled out of the route.
Thursday, 15 December 2011 14:49
THE Securities Commission of Zimbabwe (SEC) and members of the ZSE met this
week to discuss issues concerning the transformation of the capital markets
and its viability. But the meeting was adjourned after members of the ZSE
requested time to establish common ground amongst its membership.
Members are expected to get back to the regulatory authority with details of
their course of action.
This comes after SEC CEO Tafadzwa Chinamo last week summoned all members of
the ZSE to attend the meeting following the non issuance of an operating
licence to the ZSE after the exchange failed to submit its 2010 financial
statements and a business plan with specific goals indicating the
transformation and development of the capital market.
SEC also accused members of abandoning the exchange given its current state
of affairs, saying they needed to be proactive in the development and
running of the exchange.
“It is worrying that the Commission has not yet issued the ZSE an operating
license due to the failure by the ZSE to provide the required information.
Of particular concern to the Commission is the non-submission of the 2010
financial statements which would enable the Commission to verify the
exchange’s capital adequacy,” Chinamo said in the circular to members.
Chinamo indicated that the ZSE was a licenced entity that needed to be
issued with an operation certificate as specified in Section 30 of the
“The exchange is owned by the members and as such it is the responsibility
of members to ensure its smooth running. Members have a responsibility to
resource the ZSE and see to it that the necessary management structures are
established and supervised for the day- to-day operations of the exchange,”
said Chinamo. “As the Commission we have reason to conclude that members
have abandoned this responsibility and we seek to establish members’
The ZSE, currently comprising of 19 broking firms, is facing viability
problems owing to the liquidity crunch in the market.
SEC said it would take action against all firms facing viability challenges.
“Liquidity is low and income for most firms falls short of expenses. As
regulator it is the Commission’s duty to ensure that only financially viable
firms operate in the market,” Chinamo said.
Only three firms have met all SEC’s requirements including capitalisation
and will soon be issued licences by way of public notice.
SEC also indicated that there were unclear admission procedures for new
There are currently about 30 brokers in the market while the last admission
was three years ago.
The ZSE is believed to be sitting on applications.
“Given the important role members play in operating the exchange the
Commission is concerned by the non-transparent manner in which new members
are admitted. Several applications are awaiting approval months after
submission resulting in a number of firms operating without two brokers as
stipulated in the SEC rules,” Chinamo said.
“It is surprising to have a profession with 30 members only given that we
have so many qualified people who can be licenced as brokers in Zimbabwe. I
believe that if the membership grows the bigger the pool of ideas we have
and this can increase the pace of transformation of the market,” a leading
Chinamo added that the current trading mechanisms employed by the ZSE were
now outdated, inefficient and unacceptable in the modern era.
“The SECZ cannot wait any longer for promises of automation and
modernisation and insist that members address this as a matter of urgency,”
Thursday, 15 December 2011 14:47
MINERS have called on the government to review the mining royalties policy,
which is charged as a percentage of turnover, and move it to a profit-based
payment system. The royalties charged for gold and platinum were increased
by Finance minister Tendai Biti in the 2012 national budget to 7% and 10%
from 4,5% and 5% respectively, as government seeks to increase the
contribution of mineral resources to the fiscus.
Chamber of Mines president Winston Chitando said there was need for
government to review the current system which is based on turnover, adding
there was a range of grades at every ore body from low to high grade.
Charging a gross royalty would make a portion unprofitable, which is
different from a royalty taken from profits, he said.
Profit-based royalties are anchored on the profitability of an operation and
allow for early recovery of capital and responsiveness to downturns in
Analysts said in order to maximise revenue in the long run, government has
to encourage investment in the sector because Zimbabwe was still
In the 2012 national budget, Biti said the economy is expected to grow 9,4%
next year as the booming mining sector fuels a solid rise in business
Government wants the firms to compensate for the extraction of the state’s
natural resources. Speaking at the Schweppes Employee Share Ownership
Scheme, President Robert Mugabe said Zimbabwe was open to partnership but on
the whole did not want companies that come to mine without society at large
Mines minister Obert Mpofu said government would take as much as it can from
the mining sector.
Mpofu said the application fee for diamond mining would be raised to US$1
million, registration at US$5 million while another mining fee which would
be charged per block would be introduced.
Mpofu said government would gain more from the mining sector.
He added that even the US$600 million that Biti had put in as diamond
revenue was a conservative projection as earnings would be much higher.
Government is currently pursuing an optimum level of taxation where the net
present value of social benefits flowing from the mineral sector would
translate to tax receipts.
The objective is not the capture of economic rent per se but the promotion
of social welfare as defined by the prevailing political process.
Stephen Mudemo, a market analyst, said the successful growth of the sector —
which will translate to economic growth — is more likely when benefit
sharing between companies and government is fair and reasonable.
“However, the changes in demands on the mining sector globally have been
driven by the recent high mineral commodity prices,” Mudemo said.
The prevailing fiscal regime for mining companies in Zimbabwe includes the
following provisions: corporate income tax at 25%, exploration, development
and capital costs can be expensed against profit in the year incurred or
carried forward to be expensed against the first year of production and
There are also exemptions on customs duty and import taxes on capital items
during exploration and development phases and a 15% withholding tax on
dividend payments to non-Zimbabweans and on services provided by foreign
Zimbabwe and Canada offer examples of mining fiscal regimes that permit the
mining firms to recover capital costs before paying income tax.
A mining project typically has a long life and therefore may be subjected to
larger cyclical swings than most sectors. Therefore the mining firms’
profits will show these price cycles. Analysts because of this, turnover
based royalties have a tendency to decrease investments as investors shift
their focus to other alternatives.
Analysts said government benefits from the current structure as it ensures a
constant flow of revenue to government from mining activities and the
charges are easier to collect and therefore can easily be earmarked for
But to the firms, such royalties are payable even in loss making years and
have a negative effect on economic cut off rate.
The trend worldwide has been to move toward profit-based taxes. This is
because most of the fiscal regimes were made in the 1980s where commodity
prices were low.
Thursday, 15 December 2011 16:02
THE just-ended Zanu PF national people’s conference in Bulawayo was dubbed a
mini ‘congress’ as fundamental structural changes were expected to take
place within the leadership at the top.
These changes were, according to the national chairperson Simon Khaya Moyo
going to be largely minimalistic. In fact there would be no changes at the
very top. The majority of Zimbabwe’s provinces endorsed the candidacy of
President Robert Mugabe in next year’s harmonised elections.
Khaya Moyo went on to say that “Zanu PF was going to pursue the
indigenisation and empowerment drive after the conference as the party’s
flagship policy in its election manifesto.”And speaking to both Algerian and
Nigerian envoys in Harare recently he further stated that “after the
conference we will go to the people to ensure that we prepare for the
harmonised elections and naturally we are looking forward to winning the
Now like may other Zimbabweans out there, I have respect for the leadership
in Zanu PF, but a distinction must be made between telling some hard truths
and being disrespectful.
It is a hard truth that must be said that Zanu PF needs to undergo a major
fundamental structural change in order for it to appeal beyond its
traditional rural voters.
Whilst the legacy of the war of liberation must be respected and protected,
it is however an old political tactic to continue to use the liberation war
ethos to win elections today. The world has moved on and it is now
imperative for Zanu PF to set old slogans aside and embrace the political
revolutions currently sweeping across the globe. Zanu PF has to renew itself
in order to survive into the 21st century or it will be forced out of
After two decades under Prime Minister Margaret Thatcher, poor Tory policies
and industrial reform Britain became a shadow of its former self. The
Thatcherite years were dogged by continuous industrial action ranging from
the mine worker to government worker strikes. This, over the years, weakened
the Tory government as the economy took a knock which provided an
opportunity for a “New Labour” led by Tony Blair that had overhauled itself
to come in with new policies towards fiscal prudence, commitment to
providing better public services and significant public sector reform.
Whilst the indigenisation and empowerment process currently underway in
Zimbabwe is a good thing, it is not enough to garner the popular vote in
next years harmonised election.
The people of Zimbabwe want fundamental change and it seems that they are
prepared to get this change from whatever source. In this respect, Zanu PF
should have used its 12th annual conference in Bulawayo to elect a new
leadership for the party.
It is imperative that this happens in order for Zanu PF to have a life after
the next election. The arguments that Zanu PF will crumble if Mugabe steps
down or that he is the only person who can win an election against Prime
Minister Morgan Tsvangirai must be dismissed with the contempt they deserve.
These arguments make a mockery of all the young capable leaders within and
outside Zanu PF.
Let me first address the two arguments put forward. Mugabe and many other
nationalists were instrumental in bringing Independence to Zimbabwe. With
that Independence legacy we saw the advent of the one man-one-vote system
non-existent before 1980. We saw the legacy of the land reform exercise with
thousands of Zimbabweans having benefited thus far.
These and many other legacies will forever remain a credit to Mugabe and
other nationalists like Comrade Joshua Nkomo and those who sacrificed their
lives for Zimbabwe. Zimbabweans will forever be eternally grateful.
But Zimbabwe mustmove on inline with the new world order. In that respect,
Zanu PF needs a new leader who will lead the party in the next harmonised
There are unfounded fears within the party that any new person at the helm
may be no match for Tsvangirai. I beg to differ. It is possible for Zanu PF
to come up with a new leader. That new leader will immediately work to
endear him or herself to the people of Zimbabwe between now and the next
election with Mugabe playing the role of a mentor. With the number of gaffes
being made by Tsvangirai it is possible for Zanu PF to have an electable
candidate before the next election.
With a new leader at its helm, Zanu PF will have no need to clamour for
elections next year. In fact, it will be prudent for Zanu PF to call for
elections to be held in 2013. This will be consistent with the natural life
of the Parliament of Zimbabwe of five years from the date of the last
election held in 2008.
The MDCs have managed to use smoke and mirrors to delay elections in
Zimbabwe and I do not see why Zanu PF can not seek to delay them further
whilst it put its house in order. Between now and then Zanu PF will have an
opportunity to make fundamental headway in rebranding the party, fiscal
prudence, commit to provide public services that truly matter to the people
of Zimbabwe like piped water and electricity.
The indigenisation and empowerment exercise currently underway must be
intensified with all credit accruing to the new leader of Zanu PF. The
indigenisation and empowerment exercise must be complemented by any equally
aggressive public sector reform exercise.
The privatisation of state institutions like the Zimbabwe electricity Supply
Authority, the Zimbabwe National Water Authority, Air Zimbabwe and many
others that are currently struggling must complement the indigenisation and
empowerment exercise that is currently targeting private foreign companies
only. Public sector institutions are key pillars of any economy and as long
as we do not attend to them Zimbabwe’s economy will remain in comatose.
On the issue of sanctions, it boggles the mind as to why the leadership of
Zanu PF are calling for elections whilst sanctions are still in place. It is
a truism that the economic sanctions on Zimbabwe were put in place primarily
to weaken Zanu PF and push citizens of Zimbabwe to turn against their
This strategy skews any election in favour of the MDC-T and muddles the
political playing field. The general idea was to have Tsvangirai and his
MDC-T party hijack the reins of power as soon as the people of Zimbabwe,
battered by economic sanctions, overthrew the Mugabe administration.
Zanu PF, under a new leader, may possibly be able to petition for the
removal of these sanctions, failure which it must refrain from participating
or calling for elections until the sanctions are removed. It will not be in
the interest of Zanu PF to go to elections with economic sanctions in place
for the simple reason that the political playing field is skewed against it.
One does not need to be rocket scientist to see that it is the young leaders
in the MDC-T, MDC-M and MDC-N who are benefiting from being part of the
Government of National Unity. They are learning on the job the skills of
running government and country, whilst the ageing leadership in Zanu PF
refuses or neglects to allow new young men and women into the top leadership
positions in the party.
Lloyd Msipa writes from the United Kingdom. He can be contacted at
firstname.lastname@example.org . This article was first published by newzimbabwe.com.
Thursday, 15 December 2011 15:43
IF there was any doubt about the need for President Mugabe to retire it was
evident in his speech to the Zanu PF conference last Thursday evening. In a
long rambling address he seemed unable to find a full stop. The interminable
speech was like a truck with no brakes. It just kept going. And when he said
“And finally”, there was a palpable sense of relief in the hall with the
band starting up and delegates waking up, but it turned out to be a dream.
There was no finality at all. He just kept rambling on, a stream of
consciousness which led him at times to repeat himself.
These matters were not helped by translations into the vernacular where
things he did say and even things he didn’t say were popped into his speech.
The sense of repetition was thus compounded.
Mugabe said he would not display cowardice by retiring while Zimbabwe
continues to experience a “sanctions-induced economic downturn”.
Sanctions-induced is it? How convenient. No need then to place the blame
where it really lies?
If proof were needed, we should only look at the resolution on restoring the
Zimdollar. Here we have the one thing that the GNU can call a success story;
the use of the US dollar alongside the rand and other hard currencies to
tame inflation and introduce a measure of predictability in the management
of the economy.
Absolutely the last thing we need is a return to the discredited Zimdollar.
There was “rapturous applause” we are told when Zanu PF secretary for legal
affairs Emmerson Mnangagwa announced the resolution.
Extraordinary isn’t it? Here is a unit of currency that wasn’t worth the
paper it was printed on. And Zanu PF applauds this travesty of a currency
knowing full well the damage it will inflict on the economy, reversing all
the gains since 2009. But Zanu PF will persist with this example of populist
grandstanding anyway no matter what the damage.
Mugabe declared that leadership at the highest level could only change hands
once the course was clear of obstacles.
So this is how it works: The president declares that “Western aggression”
remains a threat to the country and that he therefore cannot release the
reins of power so long as this fictitious “threat” remains.
In fact trade with Britain and the United States has increased significantly
since 2008, according to the Herald’s business pages.
But the threat remains a convenient pretext for avoiding leadership
And what about those Zanu PF luminaries reported in WikiLeaks as lining up
outside the US embassy to say they want Mugabe to go? They were in Bulawayo
last weekend keeping their heads down.
What happens next is a concoction of partisan measures such as more land
seizures, a flawed indigenisation programme that will scare off investment,
and a draft constitution designed to serve only one party in the coalition.
The reform programme the GPA was supposed to usher in will be largely
shunted aside. In fact it already has been. Zanu PF simply doesn’t
understand the importance of working together for the good of the country.
Nobody buys their silly claims about sanctions except perhaps Chipangano and
towering intellects like Jabulani Sibanda.
What is surprising is the role played by journalists in propping up the
fiction that Mugabe is indispensable. Some are working at second-rate
universities such as Bindura from where they publish articles in the Herald
as conjoined twins, clearly unable to think individually.
No wonder the president sends his daughter abroad to be educated.
On this note, there was another gushing advertisement congratulating Bona
Mugabe on her degree in the Herald last week. It read: “The Higher and
Tertiary education fraternity is always proud of the Chancellor of state
universities, Cde RG Mugabe. When Bona, the eldest child, is graduating it
sets an example for other young people to emulate. Graduation proves that
hard work, determination and self-discipline are indeed the key to unlocking
potential. This is a proud and momentous occasion for the first family and
indeed for us all. Well done.”
The notice was placed by minister Stan Mudenge, Deputy minister Senator
Lutho Tapela, and Permanent Secretary Dr Washington Mabizvo, who together
with “the entire staff of the ministry and students in all our tertiary
institutions and universities wish to congratulate the first family on Bona’s
attainment of the Degree of Bachelor of Accountancy at the City University,
While Muckraker doesn’t want to detract from any of this, we are fascinated
to know how Stan and his subordinates managed to assess the views of “the
entire staff of the ministry and students in all our tertiary institutions
and universities”. Was there a headcount?
Muckraker was intrigued last week to see a photo of Glen Ford, the actor,
writing about the “Euro-American offensive”. No, not the currency. He was,
we were told, editor of something called the blackagendareport.com.
We wonder if Mr Ford is aware of his designation in the Herald? And of
course his change in colour!
Perhaps Cde Coltrane Chimurenga can tell us. Coltrane manages to find his
way to every Zanu PF shindig. We wonder who pays for his trips?
Really worrying is the announcement by the ANC that it will be assisting
Zanu PF with a team of “strategists” ahead of the next election. The
announcement was made by ANC secretary-general Gwede Mantashe. It will
enable our “revolutionaries” to learn about the stunning levels of
corruption achieved by their counterparts down south in only 17 years.
This includes inside deals on tenders, corrupt contracts, a flawed judicial
process and corruption in arms procurement.
How for instance did Julius Malema become so rich so quickly?
Zanu PF of course had a head start in some of these areas and will no doubt
teach the ANC a thing or two.
A number of journalists have called to make it clear Nehanda and Kaguvi were
not hanged at the “hanging tree” on Herbert Chitepo Ave before the City of
Harare knocked it over last week. They were in fact executed at Salisbury
prison in Market Square, Victoria St. The Jesuit priests who tried to
convert them prior to their execution have provided detailed accounts of
their last days. This includes Father Richardtz who wrote in the Zambezi
Mission Record (1899) of the fate of Chargwe and Kaguvi.
Returning to our conference coverage, we have commented on President Mugabe’s
declaration that he will not display “cowardice” by retiring while Zimbabwe
continues to be a victim of Western aggression.
“When the West is still holding the sanctions against us and they are still
working on regime change, and also we are still in this inclusive
government… I say ah, no! I am now on show and it would be completely wrong
and a loss of confidence in myself and an act of cowardice as well.”
So the cat is finally out of the bag. Mugabe is clearly intent on remaining
in office and with him the fortunes of the “revolutionary” party.
Is it possible to have a situation where there are no obstacles at party or
government level? What an indictment on the rest of the party leadership.
Zanu PF without Mugabe cannot survive.
Mugabe will find little comfort from the fawning adulation from party
members which bordered on the blasphemous. The WikiLeaks revelations have
laid bare the truth that Zanu PF supporters are equally fed up with Mugabe’s
rule like everyone else.
The Herald’s Caesar Zvayi believes the conference was a “huge lesson for
democracy”, adding that the resolution on non-violence, coupled with the
“frankness” displayed at the conference is a lesson for other political
Oh please! What frankness is he talking about when everyone avoided the
elephant in the room; Mugabe’s retirement.
Zanu PF Women’s Affairs Secretary for Information and Publicity, Monica
Mutsvangwa, also hailed the outcome of the conference, in particular the
resolutions on the empowerment of women and the ordinary people.
Mutsvangwa, speaking on the sidelines of the conference, disclosed that
diamonds were raking in US$90 billion. So what is this complaint about
sanctions when we are making so much “filthy lucre”?
We were interested to note the Zimbabwe Prison Services has launched the
Commissioners Charity Fund aimed at improving conditions in its prisons and
the welfare of staff.
Speaking during the launch of the ZPS Commissioner’s Goodwill Trust Fund at
the weekend, the Herald reported, Commissioner of Prisons Retired
Major-General Paradzayi Zimondi urged all stakeholders to play their roles
in complementing their efforts. ZPS, he said, introduced a staff benefit
fund to assist in financing their needs.
“Our staff has since been experiencing shortage of accommodation due to
insufficient funding from the fiscus thus we have looked for legal ways
through which we can raise funds in assisting our officers,” Zimondi said.
“I am delighted that our officers are standing firm and being able to
execute their main duty of preventing escapes and rehabilitation of inmates
diligently,” he said.
The ZPS Commissioner’s Fund is chaired by businessman and Intertfin boss
Farai Rwodzi. The other board members are, Moses Chingwena, owner of Croco
Motors, Kumbirai Katsande of the Confederation of Zimbabwe Industries,
National Blood Services Zimbabwe public relations manager Esther Masunda,
Zimpapers group chief executive Justin Mutasa, FBC Holdings Group
non-executive chairman Herbert Nkala, Prisons Deputy Commissioner Fadzai
Mupfure and retired Deputy Commissioner Milton Siziba.
A worthy collection of citizens, we are sure. But what experience of prison
conditions have these ladies and gentlemen had? Has Justin Mutasa for
example ever been near a prison?
Has he had to visit any of his brave scribes as they languish in the
darkness of Zimbabwe’s filthy and over-crowded jails?
Offers from business executives to have jail floors disinfected and scrubbed
down at regular intervals have fallen on deaf ears.
We were amused by the Sunday Mail feature “Freedom Trains’ panacea to
traffic congestion” which brought back memories of the Zanu PF government’s
tattered legacy in service delivery.
“They were christened ‘Freedom Trains’, ample testimony of their
popularity,” states the writer.
That was not popularity but the desperation of a people whose only other
option was footing it.
“Images of dozens of commuters exercising ‘freedom’ by sitting precariously
on the trains still linger,” the article adds.
This is freedom according to Zanu PF. What sane person would risk life and
limb dangling from a moving train unless forced to do so?
We do, however, agree with the writer’s assertion that “not much has been
done by way of investment in transport infrastructure”.
Who can forget the sight of Enos Chikowore ceremoniously turning the first
sod of soil on the site of what was to be the new Chitungwiza-Harare
high-speed line. It ended there. What happened to the Mabvuku/Tafara line?
As usual, Zanu PF is likely to blame it on the “illegal” sanctions.
Finally The Times of India reports that an unnamed Islamic cleric based in
Europe has issued a ban on women touching fruits and vegetables resembling
the male sexual organ to avoid “sexual thoughts”.
The cleric said that women should not even get close to bananas or
“If women wish to eat these food items, a third party, preferably a male
related to them such as their father or husband, should cut the items into
small pieces and serve,” the cleric dictated.
According to the cleric, bananas and cucumbers “resemble the male penis” and
therefore could arouse women or “make them think of sex”. The cleric also
added carrots and zucchini to the list of forbidden foods for women.
Sounds bananas to us!
Thursday, 15 December 2011 15:35
AFTER observing the extent to which government (or major components of
government) continue to pursues policies which can achieve naught but
self-advancement or enrichment, ongoing demolition of the economy with
concomitant poverty, and wide-ranging and diverse advice on the ills of
those policies, many inevitably ponder whether it is not the intent (for
whatsoever reasons) of the culpable politicians to decimate the economy.
Since 2007, at the instance of dogmatic factions of government, Zimbabwe has
been pursuing policies of indigenisation and empowerment. The principle is
commendable and — if the pronounced prevailing poverty is to be eradicated —
wholly necessary. However, the methodology pursued is counterproductive and
destructive, and is the overriding barrier to achieving the declared
Almost ad nauseum, the fatalistic consequences of the manner whereby
indigenisation and empowerment are pursued have been highlighted by economic
commentators, investors, the business community, diplomats, and numerous
others. But all their advice as to the prejudices of the policies and as to
how the objectives could be effectively and beneficially attained is
consistently disregarded, or is ill-advisedly dismissed.
This was yet again strongly emphasised at last week’s Zanu PF conference.
Addressing the intent to implement the existing programme of indigenisation
and empowerment, President Robert Mugabe said that “we will not drive away
those companies that brought investment into the country, but we will not
allow them to be our masters”.
Clearly he has either not been informed or he has been misinformed as to the
realities. Since the enactment of the Indigenisation and Empowerment Act
and its underlying regulations, most investors have ceased enhancing their
investment despite the critical need for funding of most enterprises. Many
have closed down their businesses and numerous others have been downsized.
Admittedly, it was prevailing economic circumstances that dictated the need
for intensified investment into those businesses but the legislation was an
insurmountable deterrent to the investors to provide the enterprise recovery
funding required. Similarly, new investors were demotivated from effecting
investments into Zimbabwe.
In his address to the conference, the president continued:
“We are no longer prepared, that is, for these big companies to continue to
exercise their ownership over us. They must pass the ownership to us and we
insist on not less than 51%. The law is there. That is our law. Going
into existing companies is just one way of empowering our people. Mining is
an area where new companies can be established. Those mining engineering,
geologists and metallurgists that have been working for years, it doesn’t
matter you are the chief executive officer, you are still a worker.
“Now we are saying, constitute yourselves into companies; we would have the
task of helping you. I have been speaking to ministers (Saviour) Kasukuwere
and (Obert) Mpofu that the concentration is on the 51%. Just imagine, 49%
of our diamonds. Forty nine percent is still leaving the country. If we
have a truly indigenous company, nothing will leave the country. Sure, we
want partners, we want technology, but let the majority of our companies be
ours in toto”.
The conference failed to recognise that, in the same manner as it is opposed
to others being the “masters” of the business ventures, so too those others
are unwilling to be subordinates to others. This is especially so when it
is those investors who provide the bulk, if not all, of the investment
capital (for neither government’s designated state entities nor the majority
of the Zimbabwean population have the requisite resources to do so), and
when the non-indigenous investors also effect substantive technology
transfer and ready access to their established markets to the Zimbabwean
Save in those countries of state-ownership of economic enterprise, and a few
bigoted, under-developed countries (primarily in Africa), it is recognised
that the key providers of resources are entitled to have primary authority
of those resources and their utilisation. To demand to the contrary is
tantamount to demanding charity of the funding, technologies, and the
acquired and developed business expertise and acumen, without any authority
over the usage thereof. This would be as equally unacceptable to an
indigenous investor, who would resent and resist providing the substance of
the enterprise inputs only to be deprived of any material influence over the
It is similarly ill-conceived to seek that the majority of the economic
ventures in the country should be wholly indigenous owned. Under-developed
and developing countries do not have the wherewithal to achieve considerable
development and growth without accessing the means for that development and
growth from external sources. (Of this, there are innumerable examples,
including the extent that the USA’s economy was enhanced by the investment
of capital from various Arab states, the economic transformation of India
over the last 30 years, the economic transformation of China, Malaysia,
Singapore, and many other countries).
Zimbabwe has a wealth of natural resources and tremendous economic
potential, but cannot constructively exploit those resources and potential
without capital, technology and ready access to markets, and hence needs to
have investment partners, not subordinates. To fulfill those needs,
investor security must be assured, including that the investor be confident
that investment funds will be productively utilised, that the investment
venture will operate effectively and with security of continuity, and that a
fair return on investment will be forthcoming. If that confidence is not
provided, the investor will seek alternative opportunities elsewhere.
It is also unfounded to allege that 49% of Zimbabwe’s diamond earnings are
leaving the country. From the revenues generated from diamond sales, all
the operational expenses of the diamond mines must be funded, and most of
those expenses are incurred in Zimbabwe, including wages, energy,
consumables, overhead and administrative costs, and royalties (which are
excessively high!) In addition, income tax is payable on realised profits
once the initial capital investment tax allowances have been absorbed,
witholding taxes are payable on dividends, various indirect taxes are
payable, as well as other imposts. All of those are funds remaining in
Zimbabwe, beneficiating the fiscus and hence the economy. That which
thereafter leaves the country is, at least, a fair return on investment to
For so long as Zimbabwe continues to pursue indigenisation and empowerment
in its present form, instead of fairly and effectively, both Foreign Direct
Investment and domestic investment by non-indigenous will be minimal, and
the prevailing Zimbabwean economic lethargy and ills will endure.
Thursday, 15 December 2011 15:17
A SPECTRE is haunting the globe — the spectre of illiberal democracy. Over
the past few months the world has witnessed the ousting of several
dictators. Once the autocrats are gone, their people focus almost
exclusively on holding democratic elections as the solution to past wrongs.
In Zimbabwe, there are also a number of politicians who are pressing for an
election in 2012. They assume that it would put an end to the political
stalemate and fix current problems. Instead, what is really needed is for
transitional agendas to shift focus from “turning point” events (elections)
to the establishment of strong institutions and processes.
In 1997, distinguished Indian-American analyst Fareed Zakaria published an
article called The Rise of Illiberal Democracy, which was written at a time
when several states around the world became democracies. Zakaria’s main
argument cautioned that it is wrong to celebrate multiparty democracy
without a parallel emphasis on the strengthening of liberal institutions to
constrain government’s power. This warning continues to be applicable,
especially in relation to states in transition like Zimbabwe and the Arab
According to Zakaria, “democracy without constitutional liberalism is
producing centralised regimes, the erosion of liberty, ethnic competition,
conflict and war”. Zakaria also points out that states that have practised
constitutional liberalism have often transitioned into democracies, but the
opposite is rarely true.
In essence, Zakaria draws a line between “democracy” and “constitutional
liberalism”. The former concept is usually linked to the idea of free and
fair elections and the existence of multiple political parties.
Constitutional liberalism is, however, much deeper as it promotes individual
liberty and the rule of law.
Zakaria references the late political scientist, Samuel Huntington to
support his argument. The famous Harvard political scientist claims that
“governments produced by elections may be inefficient, corrupt,
short-sighted, irresponsible, dominated by special interests, and incapable
of adopting policies demanded by the public good. These qualities make such
governments undesirable but they do not make them undemocratic.”
In other words, leaders coming to power via the ballot box could be
tenderpreneurs and siphon money off to foreign bank accounts. History is
also replete with more acute examples of leaders that managed to usurp a lot
a power soon after democratically coming into office. What if such newly
elected leaders are racist or genocidaires?
One of the twentieth century’s most notorious dictators, Adolf Hitler,
committed some of the worst crimes against humanity yet he came to power
democratically. Following a close election in 1932, Hitler was appointed
Chancellor and saw his party gain a majority of seats in parliament within a
few months. Soon after Hilter consolidated power and turned a democratic
mandate into a single party state, he led the German nation into World War
II and succeeded in exterminating millions of innocent people.
In 1997, after seven years of civil war, Liberia’s Charles Taylor was
democratically elected as president of the country. One of his notorious
election slogans was, “He killed my Ma; he killed my Pa; but I will vote for
him.” Instead of putting an end to the fighting, Taylor expanded it into a
regional conflict using child soldiers and killing thousands.
Hitler and Taylor are extreme examples, but the lesson learned is that an
election by itself will not solve political problems unless it is
accompanied by strengthening the rule of law and institutions that limit
government excess. The critical elements are a separation of powers, and
the promotion and protection of basic liberties, such as minority rights,
and freedom of speech, association, assembly, religion and property.
In Zimbabwe, as in many of the Arab Spring countries, there is a strong push
to go to the polls in 2012. A number of politicians seem to presume that
democratic elections will be the panacea to the country’s problems. Some
even adopt a winner-takes-all attitude towards the election, because in the
absence of an adequate framework that limits the powers of government, there
is a lot at stake. However, unless the outstanding institutional issues are
addressed, elections could be perilous. Instead, there should be a stronger
emphasis on what happens before and after elections — that is, on those
processes that define the rules of the game.
To voters, political parties, and the international community, this means
prioritising institution building to establish a strong liberal
constitutional state. In South Africa, an interim constitution was
developed in advance of the 1994 democratic elections in order to facilitate
the transition from an authoritarian regime to a liberal democracy. The
interim constitution made democratic elections possible, but more
importantly it also imposed limits on government, and defined and promoted
equality before the law, a number of human rights and civil liberties, and
the separation of powers.
Still, the mere existence of a constitution, even a liberal one, is not the
same as constitutionalism. Constitutions define the relationship between
the state and the individual, but constitutionalism means that in practice a
government acts in accordance with the rule of law and that it accepts
limitations on its power. Constitutionalism breathes life into a
The Southern African Development Community’s facilitators are therefore
correct in stressing that Zimbabwe should not gun for an early election
without implementing outstanding issues under the Global Political Agreement
(GPA). Even if the GPA is completely realised, it will nevertheless fall
short of establishing a fully fledged liberal democracy, but at least it
will be a step in the right direction. Constitutionalism only develops over
time, which in turn promotes long-term stability.
It is thus crucial to put more effort into forging a liberal constitutional
state as opposed to overemphasising the need for early democratic elections.
As argued by Zakaria, “constitutional liberalism is about the limitation of
power; democracy about its accumulation and use”. In other words, elections
are only significant in as much as they determine which political party
gains power but do not tell us how is will be used. Political parties come
and go, but the state and its institutions generally stay intact, which is
why they should be the real focal points of any transitional debate.
Leon Hartwell is a political analyst based in Harare.
Thursday, 15 December 2011 15:13
THE announcement of results is the climax of any election process. It is the
moment that voters and observers eagerly await after casting their votes. It
is the electoral process which must be handled transparently and fairly as
mishandling could put to waste all the effort and investment put into the
process. How and when election results are announced is therefore a
fundamental area of the electoral process that deserves careful
consideration in the current reform process.
The critical significance of reforms was made more apparent in the March
2008 presidential election when the farcical handling of the announcement of
results by the Zimbabwe Electoral Commission (ZEC) did great damage to the
credibility of an election that had passed without many problems. It took at
least six weeks before the ZEC announced the results. This gave rise to
allegations that the delays were deliberately designed to manipulate the
election results. The violence, intimidation and coercion that ensued only
served to heighten suspicions that the delays had been orchestrated to claw
lost ground to the then ruling party’s candidate.
Part of the problem was that the legal architecture for the announcement of
results lacked clarity and gave room to confusion and manipulation. The
electoral amendments are designed to cover the gaps in the law and provide
more clarity. Whether or not they do so adequately is the subject of this
Harmonisation of provisions
The announcement of presidential election results is currently governed by
sections 110, 112 and the Second Schedule of the Electoral Act. Clause 29
repeals and substitutes Section 110 of the Electoral Act. The main object is
to bring within a single section all the special provisions presently
contained in Section 112 and the Second Schedule which will be repealed.
Posting of returns
The provisions attempt to promote transparency in the counting and collation
of votes requiring constituency returns to be posted outside the
constituency centre which enables the public to have immediate access to the
results. All candidates must be given reasonable notice to attend the
verification and counting of results.
Announcement of results
Section 110(3) (h) is a particularly important addition in that it sets a
specified period within which presidential election results must be
announced. It requires that the Chief Elections Officer declares the results
within five days of the last polling day in the presidential election or the
presidential run-off election.
Where a recount has been ordered, results must be declared within five days
of the completion of the recount. It must be noted that where a recount is
ordered it must, in terms of Section 67A, be completed within five days
after the last polling day of the election (although the Electoral Court has
the power to extend this period upon application by the ZEC).
On analysis, setting a period for the declaration of results is an important
step given what transpired in the 2008 presidential election when it took an
unduly lengthy period before the results were officially announced. This
caused anxiety, uncertainty and gave rise to concerns of election rigging
and severely compromised the credibility of the election’s result. The new
limit goes some way to minimise the risks of such undue and inordinate
Nevertheless, there is another provision which requires that results be
declared “forthwith” after the counting. This implies that although there is
a five-day period within which to announce results, the primary obligation
is to ensure the immediate announcement of results. Therefore the
expectation is that where the ZEC has finished counting on the second day,
the declaration should be done immediately upon completion rather than wait
for the fifth day.
Also, in light of this “forthwith” requirement, although the Electoral Court
can extend the period within which election results must be announced, it is
expected that it would use its discretion sparingly in the interests of
expediting the election process and bringing finality to the process which
has fundamental consequences to the conduct of the affairs of the state. Any
extension would therefore have to be well considered and reasonable under
Zesn however notes a potential difficulty which may arise in the area of
computation of specific periods regarding:
Results’ declaration (which should be done within five days of the last
The vote re-count (which should also be completed within five days of the
last polling day) and
The declaration of the vote-recount (which should be done within five days
of the completion of the recount).
This means in effect that the period within which a vote recount must be
completed runs concurrently with the period within which the election
results must be declared, ie five days of the last polling day. Assuming,
therefore, that the results are declared on the fifth day of the last
polling day and a re-count is ordered, it is unlikely to be completed within
the stipulated period (there will only be a matter of hours to the end of
the fifth day). This means the Electoral Court would be called upon to
extend the days to allow a recount. Zesn recommends that it is better for
the sake of clarity to place a limit on the recount period to run from the
day that it is ordered and to make this period not more than two days.
In addition, the provision allows for results of the re-count to be
announced within a five-day period from the completion of the re-count. This
will mean potentially a further five days from the day the recount is
completed before the vote recount result is declared. Zesn believes that
this is unnecessary and causes unwarranted delays in the results declaration
process. There is no need to allow a five-day period “after the completion
of the recount” to declare the re-count result. It is reasonable to expect
that once completed, the re-count result should be announced. Indeed, it is
very difficult to see any point or rationale for potentially waiting for a
further five days from completing the recount before the result is declared.
It only breeds anxiety, uncertainty and fears of rigging that the statute is
trying to minimise. Ideally, the vote-recount must be declared as soon as it
is completed — if any limit must be imposed, it should be no more than 24
hours after the completion of the recount.
Pre-emption of results
Another key provision on the announcement of results is the new Section 66A
which will prohibit any person from pre-empting the official announcement of
the results of an election. Persons who purport to announce the results of
an election before they are officially announced by an electoral officer
will be subject to criminal prosecution. Official declaration and
announcement of results of an election is the sole preserve of electoral
In order to prevent pre-emption of results as envisaged in the Bill, Zesn
also urges the Commission to ensure that results are declared “forthwith”
after counting. In the past pre-emption of the official declaration has
occurred as a direct response to delays in declaring the official results.
This can be avoided by the ZEC ensuring prompt declaration of results.
Zesn is also concerned that this clause may pose risks, particularly given
that polling stations and constituency returns will be made public at the
relevant stages of the electoral process. Many people who are merely members
of political parties are at risk of contravening this provision even if they
are simply stating what is apparent from the posted returns. Journalists
will be at greater risk but presumably can be argued to be outside the reach
of these provisions as they appear to cover members and office-bearers of
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Thursday, 15 December 2011 15:04
By André Brink
SOUTH Africa is no longer the place of new hope introduced by Nelson
Mandela. Over the past month, after a number of chilling premonitions, the
country abruptly turned away from his footprints, preferring instead to
blunder past the tombstones and debris of the apartheid era. The adoption of
the Protection of Information Bill by the African National Congress in a
parliament shaken with shock and revulsion, cancelled in a single crude
stroke the Freedom Charter which –– even while wilfully denied for half a
century –– had guided the country through the murky years of DF Malan,
Hendrik Verwoerd and the other apartheid leaders towards the new dawn
brought by Mandela in 1990.
It has dented the proud new constitution built on a foundation of human
rights admired all over the world, besmirched the legacy of Mandela and
Desmond Tutu, and insulted the legacy of millions who had dedicated their
lives to the construction of a future built on the hope of a new beginning.
It glorified the myopia, greed and selfishness of a handful of third-rate
politicians focused only on their own gain and advancement.
Masquerading as legislation aimed at protecting crucial military and state
intelligence, this Bill is conceived in such a way as to protect the
corruption that has now infested South African public life for years; and
the absence of a public interest clause leaves it open to flagrant criminal
abuse and self-serving manoeuvring.
The vagueness and evasions that persist in the bill after extensive
discussion in parliament and by the public suggest that these are not
accidental problems or the results of carelessness. Rather they are part of
a very deliberate strategy to develop the bill as a measure for covering up
corruption and protecting political criminals –– which, in due course, may
make it a useful tool even in censoring public discussion and the arts,
including –– particularly –– literature.
We should, of course, have been warned. The signs were there for anyone to
see when the ANC turned the election of a new president into a mere
insulting spectacle or changed their youth league into a blunt instrument of
mass entertainment, only to see how the league in its turn began to dictate
ANC policy and manipulate its leadership, or when the Dalai Lama was first
denied a visa and a senior minister in parliament petulantly asked: “Who is
the Dalai Lama?”
It has never been a requirement for political leadership to be measured by
moral integrity. And yet those leaders who have managed to leave an
indelible imprint on their time have always brought more than political
acumen to the exercise of their functions. Not all US presidents have been
Washingtons or Lincolns. But even with their blemishes, an FDR or an Ike
could leave a more lasting mark on their time than a Johnson or a Ford.
Perhaps the ANC has been too lucky, or too spoilt, for its own good. How
could one expect any leader to step into the shoes of a Mandela. Still,
perhaps his radiance could outlast even an ordinary successor, and Thabo
Mbeki was not to be scorned (even if, admittedly, his father would have
added more gravitas to the role). But Jacob Zuma? Had he not brought with
him the shadow of unfinished business in the shape of allegations over a
corruption scandal all might not have been as distressing as it now is.
I know that in the years before the political changeover, whenever I met the
ANC leadership in exile I could always return with a profound faith in the
quality of that leadership. There was always, of course, Mandela. But there
were others, and behind them, the shining shades of Albert Luthuli and
Oliver Tambo, political leaders imbued with moral force and philosophical
depth. But today who are the leaders in the ANC who, truly, think?
There were possibilities at an early stage but money or prudence saw them
fade from view. With Zuma, it seems, the street fighters have taken over.
Next year the party will be celebrating its centenary. How the mighty have
fallen. How the bright morning stars have tumbled into the sulphurous pit!
We are back where we started when we believed we had finally freed ourselves
from the blindfolds of censorship, suspicion, witch hunts, and restrictions
on writing and speech and brave unfettered thought.
It could have been a tragedy, but regrettably our play lacks the stature
that is indispensable for tragedy. There have indeed been men and women who
bestrode the narrow stage like colossi. But it seems that South Africa no
longer has space for real actors, only for clumsy and unfunny marionettes.
The writer has led a protest of South African authors against the new
Thursday, 15 December 2011 16:27
OVER the years Zanu PF has held the economy to ransom. And it seems the
party will not let go of this deathly grip.
A few years after bringing the economy to its knees through relentless and
suicidal printing of money, Zanu PF and central bank governor Gideon Gono
are at it again: pushing for the return of the demonetised Zimbabwe dollar.
And having a central bank chief like Gono, who has confessed to a reckless
knack for running the printing press, brings shudders down the spines of
Zimbabweans who bore the full brunt of spiralling inflation brought about by
the irresponsible printing of money.
The recent hullabaloo from Zanu PF and Gono only serves to expose a
desperate ploy by the two bedfellows to regain control of the printing press
at the expense of economic recovery and stability.
Without the printing press, Gono and Zanu PF lost much of their financial
muscle. For instance, there is little the RBZ chief can do to control the
direction of monetary issues since all the currencies in use are from
It is no secret that Gono assumed a very powerful role when he controlled
the flow of money and it would appear he misses his old persona.
Although he strongly believes in the re-introduction of the Zimbabwe dollar
backed by mineral wealth, namely gold,many doubt the feasibility of the gold
standard in Zimbabwe.
Just how much in gold reserves does Zimbabwe hold to justify the move? In
his 2012 budget statement, Finance minister Tendai Biti indicated that gold
output is expected to increase to 13 000 kgs in 2011 which translates to
about US$735 million at current international prices.
All the gold Zimbabwe is producing is being exported and we have no reserves
to write home about. Zimbabwe was kicked out of the London Bullion Market
Association after the country produced a paltry three tonnes of gold.
If, for instance, the gold we are currently producing were reserves then we
would be talking of a money supply of US$735 million, which would be the
total amount of money available in an economy at that specific time which is
backed by gold.
Is this figure enough to generate economic activity and yet still foster
much-needed economic growth?
Total deposits in the economy are currently at US$3 billion and it is
believed that a total of US$2 billion is circulating in the informal sector.
With a total of US$5 billion currently circulating in the country,
hypothetically we need to be holding reserves of 88 600 kgs for us to be
fully backed by gold.
It is projected that gold output will increase to 15 000 kgs by the end of
2012. At the current levels of 2 000kgs per annum, we will need 36 years to
build reserves of 88 600 kgs based on the assumption that the gold we are
currently producing are reserves.
It is a mystery why Gono decided to excite the nation with a half-baked idea
given that it requires so many years for Zimbabwe to build gold reserves
which can fully back the current money in circulation.
Curiously, the gold standard fell away in 1971 and given the current turmoil
in global markets, gold has been a safe haven for investors and most central
banks. All we need to do as a country is to build on our reserves so that we
create a hedge against the pressures on the US dollar. Central banks
globally are increasing their gold holdings, not as substitute for their
currency, but as a store of value since the historical premier currency is
now very unstable.
Additionally, because of lack of comprehensive geological surveys we do not
have a reliable figure of gold resources we have and it is only naïve to
develop a currency backed on the premise of existence of resources which
have not been quantified.
Thursday, 15 December 2011 16:23
IT’S high time that Sadc, as well as the African Union (AU), show their
opposition to President Robert Mugabe and Zanu PF over their refusal to
fully consummate the Global Political Agreement (GPA) by whipping them into
line and thus saving the country from sliding back into the anarchy of 2008.
Mugabe and his party, at the weekend, resolved to stampede Zimbabwe into
elections next year with or without a new constitution and also without
implementing critical reforms to guarantee a free and fair poll –– where the
wishes of the electorate are upheld.
Sadc and the AU as the guarantors of the GPA should unequivocally challenge
Mugabe and Zanu PF’s position on the polls and ensure that the prerequisite
reforms are undertaken. We need the regional and continental bodies’
intervention now if we are to retain the gains made since the formation of
the inclusive government in February 2009.
Mugabe and his party know that their chances of winning a free and fair poll
are minuscule hence the blocking of reforms in order to narrow the gap.
Violence will likely be deployed as well, as has been done in the past. Zanu
PF thrives on chaos.
We have said it before; Sadc and the AU’s intervention should come in the
form of nudging –– and if necessary –– coercing Mugabe to follow the
recently crafted election roadmap.
The roadmap is clear that no elections should be held without a new
constitution. Sadc and the AU should reject Mugabe’s bid to deviate from
this important covenant which the inclusive government partners agreed on in
A radical transformation of the Zimbabwe Electoral Commission (ZEC) should
also be a top priority. State spies should be flushed out of ZEC’s
secretariat and the commission should be responsible for voter registration.
The roadmap must lead to the independence and impartiality of ZEC.
Delimitation of constituencies should also be the responsibility of the ZEC
to avoid gerrymandering.
A credible election would entail a complete turnaround in the modus operandi
of monitoring and enforcement of electoral laws. So far we are yet to see
any evidence of those changes.
The roadmap must give room for international observers to be in the country
before as well as after the elections to avert violence and intimidation. If
adequately resourced observers are timeously deployed in the country’s over
55 districts, violence could be significantly minimised.
Sadc and the AU must also be wary of the influence of the securocrats in
elections which always seem to go beyond the call of duty. It should be made
clear, in no uncertain terms, to the uniformed forcesdoing Zanu PF’s bidding
what their interference in political issues is tantamount to. Their duty is
to protect our territorial integrity, not to be political commissars of
Mugabe and Zanu PF.
Above all, Sadc and the AU must ensure real media reforms. Zimpapers and ZBC
cannot anymore sacrifice their roles as public media on the altar of
propping up Mugabe and Zanu PF.
Why can’t we emulate our neighbours like South Africa, Botswana and Zambia
who give airtime to all political parties? To top it off they continue to
refuse to allow diversity in our airwaves save for stations aligned to the
former ruling party.
We are encouraged by Sadc facilitatior, South African President Jacob Zuma’s
stance that elections will only take place after the full implementation of
the GPA. He must remain steadfast. We await to hear the position of the AU
on this matter. We don’t want another Libya.
Thursday, 15 December 2011 16:20
THE shocking –– but unsurprising –– news that two new radio licences have
been awarded to groups loyal to President Robert Mugabe is just another
example of the lengths that his Zanu PF party will go to retain control of
the all-important airwaves.
Ever since Independence in 1980, Zanu PF has resisted moves to open-up the
airwaves, while using the state broadcaster to entrench the party’s power
through propaganda activities and attacks on its political enemies, as well
as feeding misinformation and portraying Zanu PF as the only party that can
administer the affairs of the state. News bulletins mostly consist of
diatribes against Mugabe’s enemies, while prime-time entertainment comprises
discussions on the evils of the imperialist West.
With private newspapers now thriving, the airwaves were the last preserve of
unchallenged Zanu PF propaganda –– and there was no way the party was going
to allow that to be eroded. And it hasn’t since Zimpapers Radio and AB
Communications are Zanu PF praise singers. But It is critical to look at the
history of the broadcasting industry to really understand why Zanu PF is so
reluctant to let go of the monopoly.
An examination of the dynamics of the two radio stations during the
liberation struggle — Voice of the Revolution run by Zapu and the Voice of
Zimbabwe broadcast by Zanu –– provides a valuable understanding of the
political and social transformation in post-Independence Zimbabwe.
Voice of Zimbabwe and Voice of the Revolution were effective means of
military communication and were one of the tools used in the political
education of the people, allowing parties to put forth their ideological
goals and communicate changing conditions of the struggle with their
While the political impact of such radio stations will always be a topic of
debate, there is little doubt they were effective enough to worry the
authorities in Rhodesia.
At Independence in 1980 the content and management of ZBC and the partisan
uses to which it was put by Mugabe’s regime came to resemble those of its
Rhodesian predecessor in certain basic respects.
Media commentator, Pedzisai Ruhanya says that –– just like the Rhodesian
Front –– Zanu PF uses ZBC both covertly and overtly to further its political
“They use their control of the media to maintain a firm grip on power in
Zimbabwe,” said Ruhanya. “Many Zimbabweans continue to lack both political
freedom and accurate, non-partisan information about the state of the
country and activities of government.”
“The music jingles on television and radio in support of Zanu PF programmes
such as land reform and economic indigenisation are all meant to help
entrench Zanu PF hence the spirited efforts to refuse to implement reform
because Zanu PF cannot imagine a situation where there is competition at the
ideological level using media diversity and platforms.”
And once the pressure for reform became too great, Zanu PF agreed to two new
commercial licences and immediately granted them to themselves! Far from
enjoying a freer and more plural radio playing field in the run-up to
possible elections in 2012, the MDC now finds itself with even more radio
stations spewing pro-Mugabe propaganda.
Media freedom activists are also frustrated because the Broadcasting
Authority of Zimbabwe has chosen to licence only two stations, when there
are more than 90 frequencies for radio stations that the government can get
What is certain is that –– even with the two new stations –– Zanu PF will
continue to rely on the unreformed ZBC for much of its propaganda. And as
long as the ZBC is not reformed, it will continue to be an appendage of Zanu
PF and it will continue to be used to further the party’s political
COURT WATCH 5/2011
Two State Prosecutions Against the Minister of Energy and Power Development
These were high-profile cases which ended in defeat for the prosecution. The State acted swiftly in the first case, and the second case seemed to be added as an afterthought, taking up a comparatively stale incident from well back in 2010. Was it a case of targeting a MDC-T Minister? Hon Elton Mangoma, the MDC-T Deputy Treasurer-General and MP for Makoni North, and a distinguished senior member of the accountancy profession, has been the Minister of Energy and Power Development in the inclusive government since 24th June 2010. Before that he was Minister of Economic Planning and Investment Promotion. He has from the beginning been one of the MDC-T’s negotiators in the ongoing GPA negotiations. The police and the Attorney-General’s office brought two criminal cases against him this year, both involving serious allegations of abuse of his office as Minister in relation to procurement of goods.
State v Hon Elton Mangoma - Abuse of Office Charges
Case No 1: The Diesel Tender Case
Arrest: On 10th March Mr Mangoma, was arrested by three plain clothes police at his government offices at Chaminuka Building and detained overnight at Braeside Police Station. He was charged with contravening section 174 of the Criminal Law Code, the accusation being that he had unlawfully abused his office as Minister of Energy and Power Development in January by ordering his subordinates to procure five million litres of diesel from a South African company, NOOA Petroleum, without following tender procedures prescribed by law and that his purpose had been to “show favour to” the company. Section 174 criminalises abuse of office “for the purpose of showing favour or disfavour to any person”. The maximum penalty for this offence is a fine of up to $3000 dollars or imprisonment not exceeding 15 years or both a fine and imprisonment.
Bail application: Mr Mangoma’s lawyer lodged a bail application with the High Court and on 15th March Justice Kudya granted bail and took the opportunity to describe the state’s case as being “weak”. Bail was set at $5000 and Mr Mangoma was ordered to surrender his passport, to continue residing at his given residential address, to report to police once a week and not to interfere with state witnesses. Mr Mangoma was released on bail on 16th March. He was detained for a total of six days. The trial date was set down for 28th March.
After his release, Mr Mangoma described his arrest as malicious, saying that he had explained the actions he had taken to procure diesel, in Cabinet on 1st March and to President Mugabe on 3rd March, to everyone’s satisfaction. He said he had acted entirely lawfully, in the national interest in an emergency situation.
The Trial: Before Mr Mangoma’s trial even started he was put back in custody, having been arrested on 25th March on a second charge and remanded in custody to face another trial in July [see below]. The trial based on the first charge started as scheduled on 28th March and Mr Mangoma pleaded not guilty. The State had lined up six witnesses to testify against him. These included his Ministry’s Permanent Secretary Justin Mupamhanga, and other witnesses from the Ministry, fuel importers and the State Procurement Board. The Permanent Secretary was the first witness called. The trial was set to continue the next day but in an ironic twist, Mr. Mangoma – still in custody on the other charge [see below] – was not brought to court from remand prison because the prisons department had no fuel. Prison officials turned down offers by Mr Mangoma’s lawyer to provide fuel. When proceedings resumed on 30th March the defence cross-examined the Permanent Secretary, and weaknesses in the State’s case were made glaringly obvious. In subsequent hearings, spread at wide intervals over the next two months, the witnesses who followed the Permanent Secretary into the witness box all failed to substantiate the State’s claims of wrongdoing by Mr Mangoma. At the close of the State case on 8th June the defence applied for Mr Mangoma’s discharge.
First case ends in acquittal: The trial ended on 28th June, when Justice Bhunu discharged and acquitted Hon. Mangoma at the close of the State case. This meant the defence was not even called on to present any evidence in Mr Mangoma’s defence. Discharge at the close of the State case is only granted when the State has failed to produce any evidence at all justifying a conviction. The judge said the State had failed to establish a prima facie case upon which a reasonable court might convict. The State witnesses had acknowledged that there had been a state of fuel emergency at the relevant time – a critical shortage of diesel fuel with no local suppliers able to help. A Procurement Act provision permits non-tender procurement procedures in time of emergency. This, said the judge, had legally justified the Minister’s emergency directive to by-pass normal tender procedures. The judge also expressed amazement that the State officials concerned had been ignorant of the Procurement Act provision for emergencies.
Case No 2: The Electricity Meters Tender Case
Arrest: On 25th March, only a few days before Mr Mangoma’s first trial on the diesel tender charges was due to start, he was again arrested, on fresh allegations of criminal abuse of duty as a public officer contrary to section 174 of the Criminal Law Code. This arrest took place at his home. He was taken before a magistrate, indicted [ordered to stand trial in the High Court] for trial commencing on 18th July, and remanded in custody. The allegation was that in 2010 he had instructed the cancellation of a tender involving the purchase and supply of a prepayment revenue management system, meters and associated equipment for ZESA just as the winner of the tender was about to be announced, and that this had been done for the purpose of showing disfavour to the tendering companies.
[Interestingly, Mr Mangoma’s second arrest and incarceration coincided with important political processes going on in Parliament. On 10th March the Supreme Court had unseated the Speaker of the House Assembly, Mr Lovemore Moyo, necessitating the election of a Speaker by members of the House and the fielding of rival ZANU-PF and MDC-T candidates for the post. Mr Mangoma, in custody on this new allegation, was not able to attend the election which was held on 29th March, effectively decreasing MDC’s voting strength in Parliament. In the event the MDC-T candidate, Mr Lovemore Moyo, won the election anyway.]
Bail application: Mr Mangoma’s lawyer lodged a bail application on 29th March. Justice Omerjee granted Mr Mangoma $5000 bail and ordered that the same bail conditions imposed by Justice Kudya should be maintained, with the only addition being that Mr Mangoma should surrender the title deeds to his house. The State prosecutor had not totally opposed bail, but had asked for a condition that Mr Mangoma be barred from reporting for duty as the Minister of Energy and Power Development until the case was finalised, arguing that such a condition was needed to prevent the Minister from interfering with State witnesses. The judge granted bail without that condition.
The State invoked section 121(3) of the Criminal Procedure and Evidence Act, thereby giving itself 7 days within which to appeal against the bail decision while Mr Mangoma remained in prison. The State then applied for the High Court’s leave to appeal to the Supreme Court against Justice Omerjee’s decision. On 4th April Justice Musakwa threw out this application and ordered Mr Mangoma’s immediate release. [This decision came too late to enable Mr Mangoma, who is also a GPA negotiator for MDC-T, to attend an important negotiators’ meeting that took place that very day.]
Mr Mangoma found himself once again at liberty, but still on trial in the first case against him – the diesel procurement case, and now facing a second High Court trial – the electricity meters tender case, scheduled for 18th July.
The State withdrew the charge in the second case before the trial: Mr Mangoma’s defence outline to the second charge was, as required by law, filed before the trial was due to start. It asserted that he had acted lawfully and in the public interest in stopping an exercise that would have resulted in a bad deal, not only for ZESA itself, which would have had to find a substantial sum, but also in unnecessary expense for ZESA customers. On 18th July, when the court assembled, prosecutor Chris Mutangadura told the court that the State wished to withdraw the case. Without going into detail he said: “The State wishes to withdraw charges in this matter. The basis upon which we prepared the charge was substantially similar to the facts in the previous charge. In the light of the judgment by Justice Bhunu we are hamstrung. The only option available for the prosecution is to withdraw the charges.” With the experience of the first trial behind it, and faced by Mr Mangoma’s defence outline, and with some of the same State witnesses lined up to give evidence, the prosecution had obviously come to the conclusion that it had no hope of countering Mr Mangoma’s defence.
The defence accepted the withdrawal and the judge accordingly discharged Mr Mangoma.
Minister Kept in Deplorable Conditions
Mr Mangoma was kept in deplorable conditions at the remand prison while confined there after his second arrest. Extraordinarily, he was classified as a “class D” prisoner, that is, a highly dangerous criminal deemed to be a security threat. He would have found himself confined in an overcrowded and dirty cell with other inmates classified as dangerous. When Mr Mangoma was brought into the courtroom on 28th March he was shivering and shackled in handcuffs and leg irons. These were only removed after his lawyer protested and requested the leg irons and handcuffs be removed.
Implications of Minister Mangoma’s Arrest and Detention
· For the Ministry of Energy and Power Development – Mr Mangoma’s Ministry plays a particularly important role in Zimbabwe’s economic revival strategy, embracing the vital fuel and power sectors. His two spells in custody kept him from his desk for a total of 16 days.
· For the MDC-T in Parliament – Mr Mangoma’s enforced absence from the House of Assembly deprived the party of his vote during that period. Every vote was potentially crucial at the time, given that elections for the Speaker’s post were taking place, but in the event his absence did not prevent his party’s candidate, Mr Lovemore Moyo, from being re-elected Speaker.
· For his constituency – a busy Minister finds it difficult enough at the best of times to attend to the needs of his constituents. Absence while in custody and the pressure of a high-profile criminal trial and related court proceeds must have handicapped Mr Mangoma even further.
· As a negotiator for the Global Political Agreement – Mr Mangoma was not available for some important meetings that took place during his incarceration and trial.
· Personal: arrest and detention is extremely stressful and prison conditions a danger to health, as well as being an intolerable ordeal for the family.
· Were Mr Mangoma’s arrests spurious and/or politically motivated? As his first arrest had been predicted by ZANU-PF insiders and as some local fuel suppliers are considered ZANU-PF-aligned, it is not surprising that in the present polarised political environment the State’s heavy-handed actions against Mr Mangoma provoked claims by Mr Mangoma’s party and many others that the charges against him were trumped-up and politically motivated. And the State’s signal failure to secure a conviction has not inspired confidence in the police and prosecution’s understanding of their responsibilities.
· Why was Mr Mangoma brought into court in legirons?
· Was thwarting bail for a leading Minister and GPA negotiator justified? Was the State’s use of section 121(3) of the Criminal Procedure and Evidence Act against Mr Mangoma remotely defensible?
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