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Tsvangirai ‘marriage’: A political powder keg

Friday, 02 December 2011 10:13

Dumisani Muleya

PRIME Minister Morgan Tsvangirai’s controversial “marriage” saga with
well-off Harare businesswoman Lorcadia Karimatsenga Tembo has created a
political powder keg which could explode in his face amid clear indications
it is intertwined with simmering factionalism within his MDC-T party and
Zanu PF. Informed sources said this week Tsvangirai, whose wife Susan died
in March 2009, was entangled in a web of money, love and power politics
threatening to extensively damage his image.

“This is a Hollywood-like story of money, love and power. Tsvangirai fell in
love with this woman (Lorcadia) after she was arranged for him by those
close to him, including the Makone family, partly because she is well-off.
The idea behind the whole arrangement was ultimately power and politics.
Those close to Tsvangirai wanted to be the power-brokers or kingmakers,” a
source close to the situation said.

“The issue has tentacles across Zanu PF politics because Lorcadia is a
sister of Beatrice Nyamupinga, a Zanu PF MP and a relative of the Mujuru
family,” the source said. “The Karimatsenga family is Zanu PF to the marrow.
For a long time now, there has been close cooperation between the MDC-T and
the Mujuru faction in Zanu PF and this ‘marriage’ was going to consolidate
that political relationship.”

The situation could be exacerbated by signs that state security agents are
running the show behind the scenes to damage Tsvangirai’s reputation ahead
of elections next year or in 2013. Reports indicate the state security
agency, the Central Intelligence Organisation, has a detailed plan to expose
real and imagined sexual escapades of top leaders of the two MDC formations
ahead of the next elections.

A few months ago Tsvangirai was at the centre of a storm over an alleged
affair with a Bulawayo woman, Aquilina Kayidza Pamberi. Tsvangirai has also
impregnated another Bulawayo woman, Loreta Nyathi, daughter of famous
football commentator Inglam Nyathi.

The prime minister has also featured prominently in the media over his
romantic escapades involving other women, including his wife’s younger
sister Leah Mhundwa and Dr Arikana Chihombori. Another woman, Elizabeth
Guma, was this week linked to Tsvangirai.

Sources say more women will come out to join the fray. Intelligence sources
say the clearest evidence that state intelligence services were pulling the
strings in the fiasco was involvement of one of the women mentioned.

“There is a woman who has just come out hinting to be one of Tsvangirai’s
girlfriends, and she might as well have been, but I know for a fact that she
is a state agent,” a source said. “I know her personally and her history,” a
source said. “The moment I saw her in the media I knew where this was coming

The script of how Tsvangirai connected with and dropped Lorcadia is
dramatic. “Lorcadia is a close friend of Theresa Makone,” the source said.
“After she was introduced to him by those in the Makone family, the
relationship went on very well for some time. Tsvangirai would even meet her
at her house in the affluent Dainfern suburb in Johannesburg. The
relationship blossomed despite so many problems which they had, including
the discomfort on his children around the issue,” a source said.

“However, things changed suddenly when Tsvangirai recently visited the
United States. While he was there he sent an email to Lorcadia saying he was
no longer interested in the relationship but she replied to it saying she
was pregnant. That shocked Tsvangiraiand put him in a fix. He either had to
marry her or pay some compensation or damages of some form to her family.

Sources said after his return from the US and agonisingover the issue,
Tsvangirai eventually plucked up courage to send emissaries to the
Karimatsenga family on November 18 “to perform traditional and cultural
rites to formalise the relationship”. The Makone family and their Zanu PF
associates, including Beatrice, rallied behind Lorcadia, trying to lock
Tsvangirai into the situation. They tried to use the occasion at Christon
Bank to place Tsvangirai in a tight spot.

However, to show Tsvangirai did not intend to marry Lorcadia, the phrase “to
formalise the relationship”, initially used loosely, was hastily removed
from the first statement released on Wednesday to avoid giving the
impression he wanted to tie the knot. The first statement said messengers
were sent “to perform traditional and cultural rites to formalise the
relationship” but the second one, correcting the first, only said “to
perform traditional and cultural rites”.

After paying $10 000 –– contrary to the $36 000 initially touted –– the
Karimatsenga family, working with their MDC-T and Zanu PF allies, stepped up
pressure on Tsvangirai to marry the woman as he was already trying to
wriggle off the hook. They then dispatched Lorcadia to Tsvangirai’s rural
Buherahome in a bid to corner him to marry her.

“It’s clear Tsvangirai no longer wanted to marry Lorcadia by the time he
sent envoys to pay damages. He thought the situation could be managed that
way as he has done elsewhere in the past but things spun out of control,
much to his horror and disappointment,” a source said.
“Tsvangirai was distressed by the situation and before he went to South
Africa he met senior party officials who were gravely concerned about the
situation. It was agreed a statement would be issued to clarify the
situation but Tsvangirai was clear, he did not want to marry the womanwhich
is why he refused to allow her to stay at his Strathaven home.”

Sources said Tsvangirai did not want to marry Lorcadia for personal and
political reasons. “It’s a complicated situation. The premier’s close allies
like those in the Makone family wanted him to marry Lorcadia but part of the
Kitchen cabinet, some other ministers close to him, were against it. So
around him there were serious divisions about it,” a source said.

“In the party it was worse. Most officials argued the marriage would ensure
Tsvangirai would be firmly controlled by the Makone family through bedroom
politics while he is also embedded in Zanu PF, which further complicates
matters. Lorcadia’s fate was sealed last week when Tsvangirai was referred
to in parliament as ‘son-in-law’ by Zanu PF MPs and Beatrice as
‘sister-in-law’ by legislators.”

The other factor why the affair collapsed, sources say, is that Tsvangirai
has apparently found a new girlfriend in the US that he wants to marry in

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...Mugabe concerned about PM’s affairs

Friday, 02 December 2011 10:10

Faith Zaba

PRESIDENT Robert Mugabe this week expressed grave concern over Prime
Minister Morgan Tsvangirai’s promiscuity and the increasing number of women
he is making pregnant and dumping, saying the premier must sort out his
life –– even if it means marrying more than one wife. In separate interviews
with the Zimbabwe Independent yesterday, Zanu PF insiders said Mugabe
sounded worried at a politburo meeting on Wednesday about Tsvangirai’s
marriage saga with Lorcadia Karimatsenga Tembo, a commodities broker, which
has become a major political issue.

Tsvangirai seemed to confirm he wanted to marry Lorcadia on Wednesday, after
several denials by officials in his office who said he had paid US$10 000
“damages” for impregnating her out of wedlock, although his second statement
was later edited to suppress that issue.

Tsvangirai said he had put into motion the process of “formalising” his
relationship with Lorcadia by performing traditional and cultural rites on
November 18 when he sent a delegation comprising his relatives to the
Karimatsenga homestead in Christon Bank near Mazowe. But he then terminated
the relationship after 12 days raising questions about whether he wanted to
marry her in the first place.

Earlier this year, it was reported Tsvangirai had made a 23-year old
Bulawayo woman, Loreta Nyathi, pregnant and now has a son with her. There
are also several other women who have been linked to him.

Mugabe said publicly on Wednesday and later at the politburo the media
should back off and stop writing about Tsvangirai’s relationships, although
he said the premier must get his house in order.

Mugabe pointed out there was no problem in African tradition with a man
marrying as many wives as he wishes, although he disagreed with his

“He said he didn’t like the way the prime minister was impregnating women
all over and dumping them (kusiya vana musango).
“He said the premier should remember that he is a leader and as a leader
people expect him to behave in a certain way and to be responsible,”
reported one politburo member.

“The president also said if he wants to marry all these women, he should
officialise the relationships like what South African President (Jacob) Zuma
has done. There is nothing wrong with that. He said the premier needs to
sort himself out and decide what he wants and who he wants.”

Mugabe said this as the Central Intelligence Organisation (CIO) has
reportedly come up with a plan to expose real and imagined sexual escapades
of top leaders of the two MDC formations ahead of the next elections as part
of a campaign to rescue Mugabe from defeat at the polls.

Intelligence sources said the CIO has hatched a plot to expose and possibly
destroy the MDC politicians through sex scandals. The plot, the sources
said, would be implemented through the state media, particularly during the
election period. The main targets of the witch-hunt are Tsvangirai, MDC-T
secretary-general Tendai Biti and MDC-N boss Professor Welshman Ncube.

The Sunday Mail, a state-controlled weekly, recently splashed on its front
page a story on Biti’s alleged affair with a married woman. The same
newspaper also carried other reports on alleged Tsvangirai and Ncube sexual

The newspaper said Biti, also Finance minister, was involved in an affair
with Petronella Chishawa which has prompted the woman’s husband Caesar
Matandirotya to take legal action.

It said Matandirotya, a Harare businessman, has since separated from his
wife. The two have a baby boy who is 14 months old, the paper said.Biti
denied the allegations and sued the newspaper.

A few months ago Tsvangirai was accused of having an affair with a Bulawayo
woman Aquilina Kayidza Pamberi. It was reported that the woman’s husband
Jacob Mandeya eventually divorced her due to adultery involving the premier,
although Pamberi insisted that domestic violence was the real cause of the
marriage breakdown.

Tsvangirai has also featured prominently in the media over his romantic
escapades involving other women, including his wife’s younger sister Leah
Mhundwa and Dr Arikana Chihombori.

Ncube, also Industry and Trade minister, was also earlier this year
entangled in an affair involving Zimbabwe Football Association chief
executive Henrietta Rushwaya. The story was also published in the
state-controlled Sunday Mail. Bulawayo arch-Bishop Pius Ncube was a few
years ago destroyed through a CIO-driven sex scandal plot publicised through
the state media.

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Kasukuwere’s wings clipped

Friday, 02 December 2011 10:01

Paidamoyo Muzulu

PRESIDENT Robert Mugabe yesterday clipped Empowerment minister Saviour
Kasukuwere’s wings by telling him that the implementation of the
controversial economic indigenization programme was not a one-man band, but
needed the cooperation of all ministries. In his address to the Zanu PF
central committee, Mugabe reprimanded Kasukuwere following open faction and
power struggles between the minister and his cabinet colleagues and senior
government officials over the implementation of the empowerment drive.

The programme has raised emotions and hostility among ministers as they view
Kasukuwere to be apportioning himself powers of a super-minister,
encroaching upon their ministerial mandates.

“Ministry of Youth’s function is to chart the course (of indigenisation) and
leave the supervision to other ministries. It’s not a one-man affair but it’s
for all ministries,” Mugabe said. “There has to be cooperation, we should
not work in conflict but in harmony. This is the way the policy should be

The indigenisation policy compels all foreign-owned companies to sell a 51%
controlling stake to locals or risk having their operating licences revoked.
Armed with this law, Kasukuwere has written to mining companies and
financial institutions, threatening to withdraw their licences if they
decline to comply.  This angered Mines minister Obert Mpofu and Reserve Bank
governor Gideon Gono.

Gono said it was impossible to indigenise a sophisticated and sensitive
banking industry using crude tactics as propounded by Kasukuwere. He said he
would not comply with any orders to withdraw banking licences as the central
bank was the only authority that licensed financial institutions.

On the other hand, Mpofu took the same aggressive and confrontational stance
against Kasukuwere when he unilaterally tried to cancel Caledonia Mining’s

Mpofu said as the minister in charge of granting mining licences he had not
revoked Caledonia’s licence and would not do so. This forced Kasukuwere to
beat a haste retreat and ‘relicense’ Caledonia less than 48 hours after
‘withdrawing’ its operating licence.

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RBZ extends RMB curatorship

Friday, 02 December 2011 09:44

Paul Nyakazeya

THE Reserve Bank of Zimbabwe has extended the curatorship for ReNaissance
Merchant Bank (RMB) by a further three months to allow cases before the High
Court to be heard. The extension will see the institution retaining the
current curators until February 2 2012. Reggie Saruchera of Grant Thornton
Camelsa chartered accountants was appointed RMB curator in June for a period
of six months which ended on Wednesday.

Reserve Bank of Zimbabwe governor Gideon Gono confirmed the extension,
saying the bank would further review RMB’s position between January 24 and
25 next year.

“Yes it will be extended to February 2 next year to allow finalisation of
what needs to be finalised by then.The Reserve Bank of Zimbabwe will
(further) review the position between 24 and 25 January 2012,”Gono said.

The central bank placed RMB under curatorship for six months on June 2 after
the bank said it had established a systematic abuse of depositors’ funds, a
high incidence  of non-performing insider loans and related-party exposures
as well as violations of banking laws and regulations.

Insiders said the central bank board was divided over the curatorship issue,
with some suggesting that the RBZ had sent a wrong signal at a time when the
financial service sector was stabilising.

When Reserve Bank of Zimbabwe  placed RMB under curatorship, it fired its
board  and that of its parent, Renaissance Financial Holdings Ltd (RFHL),
comprising group chairman Lovemore  Moyo, CEO Patterson Timba, group
executive director responsible for business development Dunmore Kundishora,
non-executive director Robert Tindwa and executive director treasury and
structured finance Shepherd Shara.

Also ousted were the head of internal audit Shepard Muzivi, manager for
treasury operations Norest Kwete, group accountant Tatenda Madzingo and
group company secretary Lydia Timba.

The arrangement, which Gono termed “recuperative curatorship”, came after a
series of investigations into RMB and its parent company RFHL which started
in April.

RMB stands accused of clandestinely attempting to sell 84% of the investment
bank and its securities arm, Renaissance Securities, to the National Social
Security Authority (NSSA).

According to a letter to the curator by the bank’s lawyer, Vote Muza of Muza
and Nyapadi, dated October 3, Saruchera was supposed to put proposals for
resolving the crisis at the bank well within six months.

The letter said Saruchera’s primary role as per his appointment was to
protect depositors and creditors.

“It therefore means your focus must be on solvency and liquidity. It is not
your role or primary concern how the liquidity is resolved, for instance,
the nature of the instruments utilised to support liquidity,” reads the
letter in part.

Muza said his client had noted “with additional concern” Saruchera’s alleged
attempt to sell, “not only a portion of the merchant bank’s equity to NSSA,
but also another of their business, ReNaissance Securities (Pvt), a company
not under recuperative curatorship”.

The letter said although the bank was then in its fourth month under
curatorship, its directors were not aware of any serious proposal(s) that
could have been brought to the shareholders or placed before the RBZ for
their consideration.

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Top posts up for grabs at Zanu PF indaba

Thursday, 01 December 2011 19:18

Faith Zaba

PRESIDENT Robert Mugabe on Thursday left room for some top leadership
changes at the Zanu PF conference to be held next week in Bulawayo,
emphasising that it will be a mini-congress.
This will give Mugabe room to make changes in the politburo ahead of
elections either next year or in 2013.

Currently, there are several vacancies in the politburo, following the
deaths of Ephraim Masawi (deputy national commissar), David Karimanzira
(secretary for finance), retired army commander General Solomon Mujuru
(committee member), and Khantibai Patel (committee member).

“It is a critical meeting which we should prepare for adequately since it is
the last conference before elections, for that reason the conference, more
or less has the status of a congress because of the matters we are going to
be seized with,” he said at the central committee meeting yesterday at the
party headquarters.

“The national people’sconference we are going to hold will be a precursor to
the running of elections next year. The duration will be three days instead
of the normal two days.”

Although none of the Zanu PF members at the conference will dare raise the
succession issue, it is likely to be played out on the sidelines of the

Party insiders told the Zimbabwe Independent this week that there is a
broader campaign by the faction led by Defence minister Emmerson Mnangagwa
to undermine his archrival Vice-President Joice Mujuru and her allies.

The sources said Mnangagwa seems to be in the ascendancy ahead of the

The scramble for power shifted to Mashonaland West this week ahead of
elections to choose the party’s provincial chairperson.

The escalation of the power struggles within Zanu PF deepened internal
conflict in the deeply divided party.

A faction aligned to Mnangagwa is expected to wrestle control of Mugabe’s
home province, Mashonaland West.

Mnangagwa –– a Mugabe loyalist –– is battling with Mujuru to take over from
the veteran leader when he leaves office.

Mujuru’s faction has been trying to push out Mugabe but Mnangagwa wants to
take over after Mugabe retires.

This was exposed in the diplomatic cables released by the WikiLeaks website.
The cables portrayed the Mujuru faction as being very close to the Americans
and more desperate to see Mugabe go. The vice-president’s late husband,
Solomon, is one of the most quoted Zanu PF politicians in the cables saying
Mugabe must retire.

Behind-the-scene meetings to nominate a candidate for the Mashonaland West
chairmanship have been taking place in the past few weeks.
Former acting Zanu PF Mashonaland West provincial chairman, John Mafa is set
to battle it out for the provincial chair’s post with deputy ministers
Reuben Marumahoko of Regional Integration and International Co-operation and
Walter Chidhakwa of State Enterprises and Parastatals.
In separate interviews with the Independent, Zanu PF sources in Mashonaland
West said Mafa has the support of all of the six administrative districts ––
Hurungwe, Zvimba, Kadoma, Makonde, Chegutu and Kariba.

They said Chidhakwa and Marumahoko were likely to face a humiliating defeat.

Chidhakwa had at one time the backing of Local Government minister Ignatius
Chombo who has since dropped him because he has no support and Marumahoko
has the support of Media and Information minister and the party’s national
commissar Webster Shamu.

The sources said Mafa’s victory would be a demonstration against imposition
of candidates by the top leadership.

One provincial executive said: “The six administrative districts in
Mashonaland West are saying no to imposition of candidates.”

“Anyone whose position is being negotiated for is seen as an imposition. Any
compromise will defeat the fight against imposition. Mafa’s victory expected
at the weekend will be a demonstration against imposition.”

The word doing the rounds in Mashonaland West is that Shamu might be trying
to organise a compromise, which will have Mafa as the chairperson, deputised
by Marumahoko, but this sources said was being rejected the six districts,
who prefer a line-up of people aligned to Mnangagwa.
While elections for the chairperson’s post are at the weekend, other members
of the executive are expected to be co-opted.

According to sources, the top six will include former information minister
Bright Matonga as deputy chair, Ray Kapesa secretary for administration and
a Zinyemba from Hurungwe as treasurer. Hurungwe East MP Sarah Mahoka will
get the provincial Women’s League chair, ahead of Shamu’s wife, Constance,
whom her husband has been trying to push for.

Another top official said: “The chairpersons of the administrative
districts, who are bitter and tired of the top leadership using the
President’s name to impose their candidates, are saying they have to
demonstrate that those days of imposition of candidates are over.
In a statement, Shamu confirmed the elections would be held this weekend.

All those interested to contest the elections were told to submit their
names and curriculum vitae (CV) to his office. However, this was the first
time that the party headquarters has asked for CVs for the provincial
chairperson’s elections.
The top officials questioned Shamu’s motive in asking for the CVs.

“Since when did the party start asking for CVs? How can you ask a person
like Mafa, who has been in the provincial executive for a long time –– he
was deputy chair before he took over from (Phillip) Chiyangwa after he was
fired from the party,” he said.

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Supreme Court judgments take too long

Thursday, 01 December 2011 18:55

Paidamoyo Muzulu

THE Supreme Court is taking an excessively long time to deliver judgments
with some cases taking an average of between 14 months and four years,
therefore rendering the judgments academic when finally handed down.
The Supreme Court has eight judges, including the Chief Justice and Deputy
Chief Justice. Out of the eight judges, Elizabeth Gwaunza has been seconded
to an international tribunal and Rita Makarau is the head of the secretariat
of the Judicial Services Commission, effectively leaving the court with six
According to documents made available to the Zimbabwe Independent, the court
handled 87 cases between October 2006 and January 2011, which translates to
about 22 cases a year.

“The average time to produce even the simplest of judgments appears to be a
matter of around 14 months,” the documents suggest. “This surely is
detrimental to justice. Putting off dealing with a case means that by the
time the judge gets around to doing so, he or she no longer has the details
freshly in mind.”

The documents reveal that the court is capable of churning out judgments
quickly if judges applied themselves to the matters with a sense of urgency.
“If each of the remaining six judges produced, on average, one judgment a
month, the court could produce 72 judgments a year. It has been some years
since the Supreme Court produced that many judgments,” the documents read.
“One judgment a month could hardly be called a prolific production rate.”
The most prolonged judgment in the document was the State versus Mbaya,
which was heard on October 30 2006. Chief Justice Godfrey Chidyausiku only
handed down his judgment four years, six months and 25 days later on May 24

Most labour appeal cases took over 15 months.

The documents showed that the longest wait for a chamber application was 11
months, 17 days in a case of Filon versus the Public Service Commission. The
shortest was two days, and it involved the case of one Mukoko versus the
Commissioner of Police.

On the political front, the court took 28 months to deliver judgment in the
matter between the MDC and the Judge President that was heard on May 17 2007
with judgment handed down in September 2009.

The report stated that no reasons were proffered for the delay in handing
down judgments.

“It is not known to what extent the delays are due to pressure of work,
delays getting the approval of other judges involved in the case, where only
one judge is responsible for the judgment, shortage of secretarial support,
or any other issues,” the documents said.

The Zimbabwean justice system has been under the spotlight for a  long time
with stakeholders raising concerns about why the legal process is generally
slow. Litigating in the country has become expensive and a preserve of the
elite since many judgments remain academic on delivery.

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Chipangano an MDC creation — Savanhu

Thursday, 01 December 2011 18:53

Faith Zaba

ZANU PF politburo member Tendai Savanhu has denied any links to Chipangano,
saying the militia group was a creation of the MDC-T to tarnish the image of
his party and its leadership ahead of elections expected either next year or
in 2013. In an interview with the Zimbabwe Independent yesterday, Savanhu
said the youth militia group was not part of Zanu PF’s strategy to reclaim
parliamentary seats in Mbare it lost to MDC-T in 2000.

In this case, Savanhu said Zanu PF’s name was dragged into the mud by its

“I want to accept that Zanu PF and MDC have clashed and fought in the past.
I am not saying it was Chipangano but it was Zanu PF and MDC, why should we
hide and say it was Chipangano. I don’t see the logic of creating another
structure outside the party constitution.”

Savanhu added: “Chipangano is not a creation of the media but of our
opponents who came up with the name — its is a strategy from the opponents
to try and build a case as we approach elections so that they say elections
are not free and fair.”

Chipangano has been terrorising people perceived not to support Zanu PF. The
group has of late almost taken over Mbare making it a no-go area for non
Zanu PF supporters — something which Savanhu described as false.

Savanhu went further to say: “President Robert Mugabe always says you cannot
win an election by beating up or threatening people, but you can win an
election by coming up with policies.”

He accused MDC-T of trying to provoke Zanu PF supporters in Mbare on many
occasions but he has told his supporters not to retaliate.
“Because of the European Union meeting in February, MDC-T came up with this
violence between January and February. We then organised a meeting attended
by politburo members at No. 5 Ground to plead with the people not to
retaliate. We told the people ‘no to violence’; we said we want peace, peace
and peace.”

He asked why MDC-T supporters and leaders’ houses in Mbare have never been
attacked if Zanu PF was as violent as the media portrayed it to be.
Savanhu said his party was also trying to find out who these Chipangano
members were but has not been successful.

‘We have beefed up our legal and security departments to investigate
incidents of violence and claims by MDC-T in cases where Zanu PF is accused
of violence because on many occasions the claims are false,” he said.

Savanhu said MDC-T has gone as far as claiming murder victims as their
supporters allegedly killed by Zanu PF.

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Turmoil rocks Zanu PF Byo

Thursday, 01 December 2011 18:52

Brian Chitemba

FRESH turmoil has erupted in Zanu PF’s Matabeleland provinces with feuding
factions openly clashing a few days ahead of the party’s crucial annual
conference in Bulawayo. This resulted in the party’s Matabeleland North
chairman Zwelitsha Masuku being sacked last week for alleged incompetence.
He was replaced by former chairman Headman Moyo. There was also a storm in
Bulawayo at the weekend provincial coordinating committee meeting where
politburo and central committee gurus clashed over the prolonged suspension
of the provincial women’s league secretary Eve Bitu.

Bitu was fired for allegedly insulting Matabeleland North governor Angeline
Masuku at a party meeting about a year ago.
Speaking to the Zimbabwe Independent this week, senior Zanu PF officials
said Masuku was removed as provincial chairman by the party’s national
commissar Webster Shamu last week on charges of failing to coordinate party
programmes in Matabeleland North.

They said Masuku had been failing to organise critical meetings and recently
cancelled a meeting in Hwange which Shamu was supposed to address. Shamu and
his delegation were only a few kilometers from the venue when Masuku called
off the meeting.

“That did not go down well with Shamu who felt that Masuku was a liability
to the party and suspended him a week after the incident,” said a Zanu PF
politburo member.

Masuku rose to the Matabeleland North chairmanship at the instigation of
Mines minister Obert Mpofu, who orchestrated the firing of former chairman
Senzo Nzube. Ncube was booted out for incompetence and lack of political
grasp. However, Ncube accused Mpofu of using his growing influence to fire
him from the party leadership.

Some officials who attended the Bulawayo provincial coordinating committee
meeting said there was a near fist fight between politburo members retired
Colonel Tshinga Dube, Edison Ncube and Angeline Masuku, who cornered
provincial chairman Isaac Dakamela for dragging the reinstatement of Bitu.
Dakamela is allegedly blocking her return at the behest of another politburo
member Eunice Sandi Moyo.
Masuku, Tshinga Dube, Sikhanyiso Ndlovu as well as central committee members
Judith Ncube and Fidelis Maphosa, the official said, were all pushing for
Bitu’s return.

Dakamela confirmed the storm over Bitu’s suspension but declined to further
discuss the issue.

“The Bitu issue must be solved before the conference next week because it’s
painting a bad picture on Bulawayo. We know she was suspended at the height
of factional clashes, but we want her back now and Sandi can’t stop all the
politburo members,” said the source.

The Bitu saga was once referred to women’s league secretary Oppah
Muchinguri, who ordered Bulawayo province to solve the matter before the

“Yes we deliberated about the suspension of Bitu and we hope she will be
back soon,” he said.

The weekend provincial coordinating committee, which brings together
politburo, central committee and national consultative assembly members,
also deliberated on preparations for the conference where President Robert
Mugabe is expected to be endorsed as the party’s presidential candidate for
the next elections.

Bulawayo, Matabeleland North, Matabeleland South, Masvingo, Harare,
Mashonaland West and Manicaland have been scrambling to endorse Mugabe,
whose office was declared a no go area by national chairman Simon Khaya

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Election code of conduct ‘worthless’

Thursday, 01 December 2011 18:51

Elias Mambo

EAGER to bury violence and build a solid foundation for future free and fair
elections, political parties last month drafted a code of conduct with noble
commandments for good political behaviour, but it will be difficult to
implement given structural flaws in the country’s state security body
politic, political analysts have said. The analysts dismissed the code as
another worthless piece of paper with good intentions.
Despite what appears to be some political will, concerns remain that the
security sector is a power centre which calls the shots, which is against
the perceived spirit of the code.
“If you take it from the point that we have a highly militarised political
dispensation, the code of conduct becomes redundant,” said Charles
Mangongera, a political analyst. “Past elections were a highly militarised
affair and I don’t think Zanu PF can do anything to control it,” he said.
Mangongera believes that the military would play a “determining role” in any
future election. The code is a political document “without relevance to
activities of the security”.
The inclusive government has still not dealt with security sector reforms,
and Mangongera believes that this was the key problem.
The draft code calls on the country’s political parties and their principals
to ensure a violence-free election by making sure that their members
strictly adhere to the code.
“The leader of a party that has subscribed to this code will instruct the
party’s officials, candidates, members and supporters that no weapon of any
kind, including any traditional weapon, may be brought to any political
rally, meeting, march or other demonstration,” it says. “A party that has
subscribed to this code will not engage in or permit any kind of violent
activity to demonstrate party strength or to prove supremacy.”
The code calls on parties that subscribe to the code to take “decisive steps
to prohibit leaders, officials, candidates and members from infringing on
the code”. Under the code, the parties agreedthat intimidation was
unacceptable, hence the need to campaign against violence or threats of
violence, and against any acts of vandalism or public disorder committed or
threatened by their officials, candidates, members or supporters.
However, the code doesn’t spell out any penalties or deterrent measures for
those who disregard it. Analysts believe such loopholesrender the code a
dead letter.
National Healing co-minister Sekai Holland said the code seeks to have “a
punitive impact on offenders and instill discipline among political players”,
but there are concerns that there were limitations to which the crafters of
the code could go.
The code is silent on those who make reckless political statements which
subsequently incite violence.

Zanu PF debated the code at one of its politburo sessions and agreed with
the contents thereof. Secretary for  administration Didymus Mutasa indicated
that they were happy with the code saying “it wasn’t about the paper alone,
but how people behave as we go into elections. It’s about how people submit
themselves to what is written in that paper”.

However, political science lecturer at the University of Zimbabwe John
Makumbe said no matter how much political will Zanu PF might  have, it was
difficult to deal with state security.

“I think the three leaders were genuine in everything they said but
unfortunately that was a futile exercise which is not going to change
anything because JOC (Joint Operations Command) is the main perpetrator of
violence in this country. Come election time, they will be sponsoring
violence,” said Makumbe.

The new code is similar to measures against politically-motivated violence
and intimidation outlined in the 2010 draft of the Electoral Amendment Bill,
in that both draftsrest the onus on the office bearers of political parties
to take appropriate measures to prevent politically motivated violence.

The only major difference is that the Bill gives the police and the Human
Rights Commission power to set up a special investigations committee and
bring offenders to book.

The irony is that the code was crafted against a background of rising
tensions between Zanu PF and MDC ahead of elections expected in 2013.
The sincerity of political players across the divide is now up for test.
Barely 24 hours after the code’s birth, Zanu PF national chairman Simon
KhayaMoyourged party supporters to retaliate and fight back if they were

“Zimbabweans are tired of insincere politicians who talk democracy and
preach violence,” saidQhubaniMoyo, the MDC-N organising secretary. “This
code will ensure that the perpetrators of violence are brought to book,”he
said, adding that his party welcomed the adoption of thecode since they
believed that Zimbabweans would enjoy the freedom they have been denied for
many years.

MDC-N acknowledged that the code does not in any way substitute the laws of
the country and the duty of the police,therefore it is imperative that
political players be sincere and adhere to the conditions stipulated so as
to build a national consensus without resolving to force.

The sincerity of political parties to abide by the code was now being put to
the test, with reports of MDC-T allegedly recruiting reaction groups to ward
off attacks.Urban militia groups such asChipangano, believed to be offshoots
of state security to victimise political opponents with impunity are still
intact, ready to pounce, should elections beckon.

And this could sum up the difficult matrix of achieving peace.

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‘ZHRC should look into all rights issues’

Thursday, 01 December 2011 18:42

AS the country commemorates 16 Days of Activism against Gender Based
Violence and Human Rights, the Zimbabwe Independent political reporter
Paidamoyo Muzulu (PM) spoke to Justice and Legal Affairs deputy minister
senator Obert Gutu (OG) about justice issues in the country as well as human
rights and gender developments. PM: It is now more than a year since your
appointment as deputy minister. What was your expectation when you were
appointed to that office?

OG: I was appointed on June 24 2010. My vision was that the Zimbabwe justice
delivery system must be made efficient and accessible to the majority of
people. My vision was and remains that where there is no justice and rule of
law in any country, then you have to forget about development.

PM: You talk of efficiency and accessibility prominently; do you think the
justice system in Zimbabwe can be described in those lofty terms?

OG: You need an efficient justice system to act as a bedrock for economic
development both at micro and macro levels. I admit our justice system is
anything but efficient and largely inaccessible, particularly to the
majority of the marginalised people and those in rural areas.

PM: What changes have you proposed?

OG: We are working closely with the Judicial Services Commission to
decentralise courts throughout the country. We have since managed to set up
47 permanent district magistrates’ courts countrywide. We also have circuit
High Court sessions in Gweru, Hwange, Mutare and Masvingo. We are now
looking at having resident High Court judges in Masvingo, Mutare, Gweru and
Hwange. The advantage is bringing justice to the people instead of taking
people to justice. You can imagine people from Binga travelling all the way
to Harare or Bulawayo to file divorce papers or deceased estate papers with
the High Court.

PM: This brings us to the issue of the untouchables in our criminal justice
system. Why is it like that?

OG: If you are politically connected, you can get away with practically
anything, rape, murder or whatever.Let’s cleanse the justice system so that
people can have faith in the system.

PM: Your ministry is taking its time to bring to parliament the Electoral
Amendment Bill and the Zimbabwe Human Rights Bill taking into consideration
their potential to promote justice in the country?

OG: We have had discussions on the Electoral Bill and Human Rights Bill. The
minister said because of certain proposed amendments coming from political
players in parliament, it has not been possible for him to proceed piloting
both bills through the house. My understanding is that these issues need to
be addressed by the three political principals. It is beyond the mandate of
the ministry of Justice and Legal Affairs to proceed with these two bills
without obtaining guidance from the principals.

PM: As a lawyer, what is your personal opinion on the matter?

OG: My personal opinion as a lawyer and human rights defender in my own
right is that the ZHRC should be empowered to look into all human rights
issues as from April 18, 1980 when Zimbabwe joined the community of nations
as a sovereign republic. I am personally against the idea of having the
commission confined to issues that arose as from the date of the formation
of the inclusive government.

PM: What are your relations with Justice minister Patrick Chinamasa?

OG: We have a sound and professional relationship with the minister.
Wherever possible, we meet to discuss issues pertaining to the ministry. Of
course we belong to different political parties and inevitably there will be
differences between us on a political level. However, I have no problems
with the minister at a personal level.

PM: What are some of the successes you have recorded in the ministry since
you came aboard?

OG: We are working with the Gender ministry to establish a formal family
court structure in Zimbabwe. I chair the committee mandated with the task of
establishing a family court in the country. I am confident that by June 2012
the formalised family court would be launched.

PM: Are you personally happy with the country’s human rights record seeing
that the state security agents have been sued for torture and human rights
abuses since Independence?

OG: We have to work hard on our human rights record if we are serious about
our democracy and socio-economic development. Our country as a brand has
been terribly damaged on the human rights front.

PM: As a senator, are you comfortable with the level of debate in the House?

OG: I am not comfortable with that. The senate should be more involved in
debating topical national issues. And that perhaps, I would be happier with
a situation where the senators themselves come up with more motions on
topical national issues.The main challenge is that of resources. In an ideal
situation each legislator should have a personal assistant to help on
research. That would help in debates and make parliament more effective as a
watchdog of the executive.

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Byo State House lies idle

Thursday, 01 December 2011 18:28

Brian Chitemba

THE Bulawayo State House has virtually been abandoned since President Robert
Mugabe hardly uses the property when he visits the country’s second city.
Built on vast woodlands next to the fast dilapidating suburb of Sauerstown,
to the north of the city along the Victoria Falls road, the large property
lies idle the whole year. It only becomes stately in April when Mugabe uses
it to host a reception for guests invited to the Zimbabwe International
Trade Fair (ZITF).
Mugabe and his large entourage usually arrive in Bulawayo on the eve of the
official opening of the ZITF, and host a banquet for the visiting head of
state invited to open the trade show. This is the only time there is any
activity at the deserted State House.

With the Zanu PF annual conference starting in Bulawayo next week, it would
be interesting to see if Mugabe would occupy his official residence in the
city for the duration of the meeting from December 6 to 10, or whether he
will shuttle between Harare and Bulawayo. Although Mugabe’s movements are
kept a closely guarded secret, it is, however, no secret that he does not
sleep in Bulawayo.

Critics accuse the government of wasting money maintaining a property only
used about once a year. The property is guarded by the presidential guard
and nearby Saurstown residents have often been subjected to random beatings
and harassment by the overzealous security details for merely walking past
the property.

But the Bulawayo State House is nothing compared to Mugabe’s official
residence in Harare where the main road next to the property is closed
between 6pm and 6am.

The Bulawayo and Harare State Houses are in sharp contrast because the one
located in the City of Kings has no precast wall, but has an old fence,
which looks like it was erected during the Ian Smith era.

The actual road leading to the Bulawayo State House is potholed just like
other roads save for the less than 1km out of bounds stretch leading to the
gate of the property.

The vast woodlands make the property resemble a large commercial farmhouse,
and only the heavily armed security details distinguish it as a VIP

A stone’s throw away from the State House fence are some maize fields
cultivated by Sauerstown and Harrisville residents. In contrast, the Harare
State House is fortified with high walls and surrounded by watered
flowerbeds and manicured lawn.

In September, about 10 MDC youths were severely beaten for allegedly handing
out fliers close to the Bulawayo state house. The soldiers reportedly
detained the youths for about three hours, during which they were stripped
naked and were beaten and forced to roll in mud.

Some Zanu PF officials in Bulawayo said there were slim chances that Mugabe
would put up in the city during his party’s conference. Mugabe usually holds
his official business at a government-linked hotel group while in Bulawayo,
but does not even sleep in the expensive presidential suite.

Mugabe hardly goes to Bulawayo and only comes to town during election
campaigns and graduation ceremonies at the National University of Science
and Technology and Lupane State University.

“We wonder why the State House in Bulawayo is not used. Is it superstition
or for security reasons? Public funds used to maintain the property are
clear testimony of a waste of the already scarce resources,” said political
analyst Chamu Mutasa.

Mutasa suggested that Vice President John Nkomo should be allowed to use the
Bulawayo State House since he spends most of his time in Bulawayo. While in
the city, Nkomo stays at his Kensington residence, about 20km east of

Mugabe’s spokesman George Charamba could not be reached for comment.

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Climate change irreversible — UN

Thursday, 01 December 2011 18:16

THE World Meteorological Organisation (WMO) warned on Tuesday at the UN
climate talks in Durban, South Africa that greenhouse gas levels were
rapidly reaching critical levels that could trigger “far reaching and
irreversible changes” to the planet, its oceans and its biosphere. In South
Africa, meteorologists confirmed the country was witnessing an unprecedented
increase in the frequency and intensity of weather “events”, and
experiencing warming trends that were above the global average.

On Tuesday morning, the WMO released a provisional statement on the status
of the global climate, showing that 2011 has been the 10th warmest year
since 1850, when records began. This was despite the strong, cooling
influence of the La Niña event that developed in the second half of last
The volume of Arctic sea ice in 2011 was also the lowest on record and the
area covered by seasonal Arctic sea was the second lowest on record — 35%
below the 1979 — 2000 average.

The full report from the UN agency, which assesses global temperatures and
provides a snapshot of weather and climate events in 2011, will be released
early next year.

WMO secretary general MichelJarraud said: “Our science is solid and it
proves unequivocally that the world is warming and that this warming is due
to human activities.”

The organisation said that the La Niña event was one of the strongest in the
last 60 years and was “closely associated” with extreme weather events seen
this year, including the drought in east Africa and flooding in southern
Africa, eastern Australia and southern Asia seen this year.

Dr Linda Makuleni, of the South African Weather Service, confirmed that
severe weather events were happening in South Africa. “Our research output
shows there is an increase in frequency and intensity in weather events,”
she said.

Makuleni said that South Africa had seen an increasing number of days with
high maximum temperatures and a decrease in frost days. The rate of increase
in temperature in the country is above the global average.

Peculiar rainfall patterns have also been observed. Makuleni said that this
year there had been severe droughts in some parts of South Africa, for
example the Eastern Cape, while other parts had experienced severe floods.
“The research we are doing indicates that … this will continue,” she said.

Makuleni said the South African Weather Service is working with the WMO to
come up with early warning services for the SADC region to deal with severe
weather events and that the organisation now also maintains a national
greenhouse gas inventory to monitor greenhouse gas levels and air quality.

Many climate scientists are frustrated with the slow uptake of scientific
information and believe a greater sense of urgency was needed when it came
to making policy decisions that can be implemented on a global scale.

Jeremiah Lengoasa, deputy secretary general of the WMO, said investmentsat
national level are needed to help people understand the climate to which
they will need to adapt in the future. He said early warning systems were
essential to help countries cope with the extreme weather events. This would
require investment in national meteorological and weather services, academic
institutions and research centres.

According to Lengoasa, there were about 70 countries in the world that are
not able to offer even basic climate information to their populations and

He said just 1% of the proposed Green Climate Fund, which negotiators at
COP17 are trying to set up and fund, would help scientists implement a
global framework for climate services that could ensure that every country
has access to the best information available to help policymakers to make
informed decisions regarding adaptation strategies.

“What’s needed is leadership, investments and commitment,” he said. — M&G.

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RioZim saga: Owed banks push for judicial management

Thursday, 01 December 2011 17:05

Reginald Sherekete

BANKS owed by RioZim Ltd will soon file for the company to be placed under
provisional judicial management, after querying the proposed conversion rate
of a debt-to-equity swap deal proposed by the company, businessdigest has
established. “We are already in consultations with our lawyers for an
application to place RioZim under judicial management. We expect the company
to be placed under the care of a judicial manager since the current board of
the company is failing to resolve the debt crisis,” a banker in the
syndicate revealed.
The Companies Act provides that the court may grant a provisional judicial
management order should a company fail to pay its debts owing to
mismanagement or any other reason.

The order can also be granted if there is reasonable probability that if the
company is placed under judicial management it will be able to pay its debts
or meet its obligations and become a viable concern.

If RioZim is placed under judicial management, its current board of
directors would be replaced by an appointed judicial manager whose task is
resuscitating the company.

“The considered opinion of the provisional judicial manager is to the
prospects of the company becoming a successful concern and of the removal of
the facts or circumstances which prevent the company from becoming a
successful concern,” the Companies Act reads.

One of the creditor banks said the financial institutions did not want to be
long-term shareholders or debt holders in RioZim, since the amounts owed by
the company were depositors’ funds.

“We are just seeking an exit strategy from the debt crisis and the
appointment of a judicial manager can speed up the process,” the banker
Should the courts grant the order, the current RioZim management led by MD
Josh Sachikonye would lose control of day-to-day affairs of the company.
The current board comprises chairman Tichaendepi Masaya,  Cosmas Ngwerume,
John Nixon, Jim Back, Thamsanqa Mpofu, Simba Makoni, Albert Nhau, FD
Emmerson Mungwariri and MD Josh Sachikonye.

The banker revealed that some banks were already in the process of compiling
“in duplum” schedules to verify that the interest component of the various
debts to RioZim did not exceed the capital.

In banking, the in duplum rule holds that interest stops running when the
unpaid interest equals the outstanding capital.
Sachikonye this week brushed off any possibility of the company being placed
under judicial management, saying banks would have to wait for the outcome
of the EGM slated for next week.

“That is rubbish. We are not going under judicial management. Wait for the
outcome of the EGM next week,” said Sachikonye.
Old Mutual, a major shareholder in RioZim, said they were not aware of the
lenders’ intentions to file for judicial management.
“We are not aware of this, but each approach will always have its pros and
cons and we will engage the relevant stakeholders as required,” said Old
Mutual in an emailed response.

Bankers told businessdigest that they had reached an impasse since RioZim
was going ahead with the tabled EGM, where shareholders’ approval would be
sought for a debt-to-equity swap deal with a disputed conversion price of
US$0,66 per share.

Banks said the conversion would create 50% “haircut” given the current
trading price of RioZim.
This would cause banks to provide for almost 50% of the outstanding loans as
bad debts but Old Mutual argued that shareholders had also taken a knock
with the price plummeting nearly 90% from a peak of 420 US cents.

“Shareholders have incurred losses too, the price was at some point above
400 US cents and it is now trading around 50 US cents,” Old Mutual said.
Given the volatility of shares, a banker close to the deal said banks would
assume considerable risk by holding the equity, adding that an acceptable
offer would be a dollar-for-dollar conversion on the debt.

“As banks we reached a compromise by accepting to convert the debt-to-equity
but on terms of a dollar-for- dollar basis. There is risk in holding shares
since stock prices are volatile, the share price can take another nosedive
and we will record further losses,” said the banker.

If banks were to hold equity in RioZim, they would be ranked lower than
normal debt holders, should the company slip into liquidation.
The banker added that it was still a huge compromise on their part to even
consider a debt-to-equity structure. But since negotiations have not yielded
much, judicial management was the only option banks have to recover their

“We are left with no option but to pursue that avenue,” said the banker.

It is now increasingly clear that that banks are now worried about their
prospects of ever recovering their money after they chose to pursue the
judicial management route.

Old Mutual said there was still room for negotiations.

“Yes, there is room to resolve the issues, if time permits. The level of
debt has to be reduced and the company must be equipped appropriately from
all angles, including financially, and become productive. As a shareholder,
we continue to engage all stakeholders, including the banks, to find a
solution for RioZim’s situation,” Old Mutual said in its responses to
questions from businessdigest.

However, when asked to comment on whether they still had confidence in
RioZim management resolving the crisis, Old Mutual did not rule out the
prospects of replacing the current RioZim directorship, citing that
leadership renewal was a common phenomenon in companies.

“Every organisation can benefit from leadership renewal through the addition
of different skills. Whether successful or otherwise, leadership renewal is
part and parcel of the normal course of events for a company,” said Old

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The budget: So little for so much

Thursday, 01 December 2011 17:02

By Linda Tsarwe

AFTER a series of postponements due to one reason or another, the Finance
minister eventually presented the 2012 budget on Thursday last week. Suffice
it to say that public interest was  rife ahead of the budget, even though
some felt that there would be no life-changing announcements from the policy

In his previous announcements, the minister stated that he will be working
with a cash budget in the coming years and as such he was singing the same
hymn of “we eat what we kill”. Looking at the current funding requirements
for the economy to fully recover, against what the government is earning as
revenue, the cash budget can only do so much for the nation as far as
capital developments are concerned.

Initially, total revenue for the budget amounted to US$3,4 billion. However,
it was revised upwards to US$4 billion with the US$600 million gap expected
to be covered by proceeds from diamond sales. This sudden dependence on
diamond revenue is worrisome. The same ministry has been quoted in the press
saying that the proceeds from diamonds sales have not been coming through to
treasury as expected.

On the other hand, the Mines ministry was defensive and claimed that the
government has been receiving what is due to them in terms of diamond
revenues. Such squabbles put into question the accountability of diamond
sales, and if any changes in terms of transparency of diamond proceeds will
exist in the coming year.

After obtaining permission to sell diamonds through the Kimberley Process,
it is not surprising that government already has high expectations from
diamonds. However, there seem to be a lot of loose ends in the
administration of the diamond-selling process. It would be paramount to work
on issues such as accountability and proper auditing or else the minister
would find himself having to revert back to his original US$3,4 billion

It is everyone’s hope that the expected US$600 million comes through. The
budget is so constrained and the minister clearly showed that he will do
whatever can be done to increase revenue. With PAYE contributing 20% of
total revenue, there is definitely no wish to reduce this contribution. A
marginal US$25 increase in the tax-free threshold says a lot. Although in
percentage terms this translates to an 11% increase, which is significant
for an ordinary person on the street, US$25 is a paltry increase.

The government cannot necessarily be blamed for not relieving the tax payer
because there is need to balance its revenue at the same time increasing
disposable income. Indications are that there are not likely to be any
significant increases in income in the coming year and if the government is
to significantly increase the tax-free threshold then it might find its
revenues significantly reduced.

However, inflationary pressures are likely going to creep into next year,
causing an imbalance on the side of the consumer. After the reinstatement of
duty on maize meal and cooking oil, inflation began to soar attributable
mainly to food inflation. In the budget, the minister expanded the food
products now liable to pay duty, with packaged products such as flour now on
the list.  This would come to the joy of the local manufacturer, who now
enjoys further protection, but still the consumer is left wanting.

It should be borne in mind that protectionism encourages inefficiency which
the consumer is involuntarily asked to pay for. The minister warned
manufacturers against riding on this advantage by increasing prices, but one
can ask whether there are any mechanisms to ensure this does not happen. The
manufacturers are not operating at capacity levels sufficient to meet
demand, yet they are being given a task to do so.

The argument is industry needs financial support to increase capacity
utilisation and re-equip with the latest technology. Only when that has been
done, can the government justifiably impose duties. At this present moment,
the protection is one-sided and the consumer is crying foul.

At the same time, these duties are also a measure to increase revenue.
Clearly no stone will be left unturned to increase inflows into the treasury
coffers. Platinum and gold royalties were also increased to 10% and 7% from
5% and 4,5% respectively. Effectively, this reduces the final consideration
to the seller and makes the business less profitable.

There is a high risk of a formation of a black market as miners would prefer
smuggling their minerals to circumvent the higher royalties. Government
might not realise as much revenue as anticipated. Other measures to increase
revenue included an increase in excise duty on cigarettes and introduction
of a 25% surtax on certain imported products.

The minister had a mammoth task whereby he needed to share a small cake
among many. Everyone has their own opinion on what should be prioritised
over the other but the ideal scenario would be to fund all sectors
adequately. In our case it is not feasible. For example, the minister stated
that US$2 billion was required annually to sufficiently fund agriculture.

This represents about 50% of the total budget, which makes it impractical.
Recurrent expenditure takes up 80% of the budget and only 20% is available
for capital expenditure. Last year, a mere US$40 million was allocated to
the critical area of power generation and this resulted in electricity
generation of below the targeted 1 600MW. This year only US$59 has been set
aside for the rehabilitation of both Hwange and Kariba power stations. Yet
power shortages remain one of the main impeding factors for productivity in
all industries.

For a country that is not operating on a cash budget, borrowing would be a
considered option to fund a budget deficit. However, in our case, government
has resolved to no longer engage in concessionary borrowing since they
already have significant borrowing with international institutions. The
danger with a cash budget is that in the event of an increase in recurrent
expenditure; say higher wage demands from civil servants, government is
forced to reallocate funds from the capital projects to meet the recurrent
demands. Budget support from donor funds can provide some reprieve but these
are not obligatory, therefore not certain.

Having a soiled history due to heavy borrowing it is commendable that the
minister has maintained his stance of a cash budget. The downside to this is
having to live within your means which Irish writer Oscar Wilde once said
that anyone who lives within their means lacks imagination. Not knowing if
this is applicable to our own Zimbabwean scenario, but seemingly the cash
budget system is likely to continue in the coming years and everyone will
have to learn to “eat what they kill”.

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Zim set to achieve its inflation target of 4,5%

Thursday, 01 December 2011 16:48

Paul Nyakazeya

ZIMBABWE can achieve its 2011 inflation target of 4,5% owing to the
depreciation of the South African rand against the US dollar, economic
analysts said this week. Most (52%) of Zimbabwe’s imports come from
rand-denominated South Africa, while local pricing is in US dollars. The
past two months have seen the rand weakening against the US dollar,
resulting in month-on-month inflation moving marginally downwards.

Zimbabwe being a net importer, particularly from South Africa, is bound to
be affected by exchange rate volatility between the US dollar and the South
African rand. Economic analyst Eric Bloch told businessdigest that the
inflation target of 4,5% was “well on target, barring major surprises”.

“The exchange rate between the US dollar and the South African rand will
determine which direction inflation will take, but if the current situation
prevails, the target will be achieved,” Bloch said.

The year-on-year inflation rate for the month of October as measured by the
all-items Consumer Price Index (CPI) stood at 4,2%, shedding 0,1 percentage
points on the September rate of 4,3%.

Bloch said not only was economic recovery critically dependent upon
government living within its means, but also government had no alternative.
He said: “Government neither has any borrowing powers in the current
environment nor the ability to print.”

The country’s year-on-year inflation rate, which was at 3,5% in January,
dropped to 3% in February. The rate dropped further to 2,7% in March and did
not move in April. The figure dropped further to 2,5% in May before
increasing by 0,4 percentage points to 2,9% in June. The inflation rate rose
in July, August and September to 3,3%, 3, 5% and 4,3%, respectively.

Economist Brains Muchemwa told businessdigest this week that the year-end
inflation target of 4,5% was within reasonable target, especially given the
recent weakening of the rand against the major world currencies.

“Zimbabwe’s industry imports about 80% of its raw materials from South
Africa, whilst trade in finished goods is equally very huge,” Muchemwa said
“Considering therefore that the US dollar is the major transacting currency
in Zimbabwe, the weakened rand will make the imports cheaper and that, in
the ideal scenario, should translate into some decrease in consumer prices
in Zimbabwe,” he said.

A report from the African Development Bank (ADB) last month indicated that
price hikes by local manufacturers following the imposition of duty on some
imported products, if not reversed, could militate against the achievement
of the year-end inflation target of 4,5%.

“There is need to address these price hikes, given that the import duty
re-introduction was aimed at protecting local producers against cheap
imports in a bid to support local industry,” said ADB.

While presenting the 2012 National Budget last week, Finance minister Tendai
Biti said since the inauguration of the inclusive government 35 months ago,
inflation management and oversight remains the apogee of Zimbabwe’s
macro-economic targets.
“Treasury, therefore, carefully analyses monthly inflation developments,
scrutinising all price-related data and the causes thereof of any marginal
shifts in inflation points,” Biti said.

Developments in the month of October witnessed some reversal, with monthly
inflation falling to 0,1%, he noted. Monthly inflation in September was
0,8%, a level last registered in March.

“The major drivers of inflation this year have been housing and rental cost,
alcohol and food. Our domestic price developments also reflect the economic
integration pattern between our economy and that of South Africa, a major
source of our imports; hence some of the price movements in South Africa are
reproduced asymmetrically in Zimbabwe,” said Biti.

The significant deceleration in inflation during October saw year-on-year
inflation falling to 4,2%, he added.

“Projections to year end, however show annual average inflation remaining
within the targeted range of 3,5% to 4,5%,” Biti pointed out.

Confederation of Zimbabwe Industries President Joseph Kanyekanye told
businessdigest imported products, mainly from South Africa, were resulting
in an increase in inflation as retailers wanted to maintain previous margins
that were in place before the duty that was imposed by Biti.

“Some local manufacturers are following suit but there are no cost reviews
on their inputs. We are not saying business should not make profit but the
days of making unrealistic and unjustified profits are long gone,” he said.
He insisted there was no justification for local goods to be more expensive
than imported ones. Some economists said given the prevailing foreign
currency-denominated economy, government would be forced to operate within
budgetary allocations because of lack of control over money supply.

Corporate lawyer and analyst Alex Magaisa said history has shown that
government has generally failed to live within its means and Biti’s
Herculean task is to inculcate discipline in line ministries.

“The trouble is there is so much that needs to be done and all this requires
resources but there is little by way of resources to do it. At the moment,
as a country we are living like hunter-gatherers, living from hand to mouth
and whilst this might permit survival, it does not provide the facility for
development at all,” Magaisa said.

Magaisa said much of the government revenue was being expended on “survival
needs” as opposed to “growth needs”.
For example, more than 60% of government’s budget has been spent on
allowances for civil servants.

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Tsvangirai his own worst enemy

Thursday, 01 December 2011 18:17

Qhubani Moyo

I AM one of those who have been vilified for criticising Prime Minister
Morgan Tsvangirai’s political activities. So vicious has been the
vilification to an extent that in some publications I have become enemy
number one for daring to express myself without fear or favour. I believe
any Zimbabwean aspiring for any public office should be subjected to
scrutiny to ensure citizens make informed decisions when they elect public
officials. It’s a basic tenet of democracy. Leaders must always be subjected
to a healthy dose of criticism, not because their critics hate them or have
any personal vendetta against them, but for the greater public good. It is
amazing and in fact ironic to see people claiming to be fighting for
democracy, yet they harbour extreme dislike for democractic practice.

If we really believe in the principles of democracy, it means we must accept
that those who aspire to be in public office or public life, be it President
Robert Mugabe, Tsvangirai, Professor Welshman Ncube or any other person for
that matter, must be subjected to rigorous scrutiny and criticism. What I
have done so far has been to criticise Mugabe and Tsvangirai publicly and I
find nothing wrong with that. I also criticise Ncube as my leader within our
party or internal structures. No one is above criticism.

However, it has come to my attention that Tsvangirai and his supporters can’t
bear criticism. Once you subject them to scrutiny, no matter how mild, they
squirm and start name-calling, rather curiously like Zanu PF.

But because Tsvangirai has aspirations to lead the country it will be
unhelpful and a negation of national responsibility to just give him a blank
cheque over all the citizens without being put to public scrutiny. Like any
other leader, he needs to be put under the public microscope.

Even though I strongly believe public officials must always have the people’s
eye kept on them, recent events in Tsvangirai’s political and social life
are beginning o persuade me to think that, from purely a political point of
view, the prime minister does not need enemies, for he is his own worst
enemy. Over the past couple of months it has become clear to me why
Tsvangirai and his supporters are afraid of scrutiny. They know very well
that they can’t stand it because of what they are hiding in their closets
and their never-ending public gaffes — the premier is dropping clangers at
an alarming rate.

In the process, he is inflicting serious damage on himself and when we point
it out his supporters become angry instead of coming to his defence through
reasoned public discourse to enhance our democratic culture and progress.
The amount of self- damage Tsvangirai inflicts on himself is now
self-evident and clear for all Zimbabweans to see. The premier has thrown
himself into the Deep End and he is struggling to swim out.

Tsvangirai has of late found himself having to lick his wounds after
damaging his reputation through ill-considered views on indigenisation, gays
and the mishandling of his personal affairs. How can you argue, at
Tsvangirai’s level, that people want jobs and not indigensaition, for
instance? It’s not an either this or that situation. The reality is that
people need equitable distribution of resources, not the Zanu PF way but the
social justice way. This is not about Mugabe or Zanu PF but about the
economy and social justice.

The issue of gays undoubtedly exposed Tsvangirai’s duplicity and propensity
to inflict unnecessary self-harm. Last year he publicly announced that he
finds homosexuality strange and wondered why a man could marry another man
when the country has such a high population of women. But now out of the
blue, and without any good reason whatsoever, he comes out supporting the
very same thing he said last year he did not agree with. This should worry
all serious Zimbabweans because Tsvangirai is a major political player in
this country and should he become president, how is he going to handle these
issues when his position changes all the time depending on who he last spoke

As if that was not enough, right in the middle of the controversy on gay
rights, Tsvangirai scores another own goal. This time it was on a purely
personal affair which ordinarily we must not be interested in. However,
given the public fallout the issue has created, it has become necessary to
debate the issue in the public interest. Here is a man who wants to be
president of a country but who can’t organise himself personally. The saga
about him and his wife/girlfriend Locadia Karimatsenga Tembo has now become
a matter of public debate, thanks to his inability to handle his personal

This naturally leads to a question which those close to him would want to
avoid: How does a person who can’t manage his personal and private affairs
run a country? If someone cannot organise themselves and run their own
affairs properly, naturally it becomes difficult for them manage complex
issues like those involving government or a state. You don’t need to be
Tsvangirai’s supporter or enemy to appreciate this.

I’m not particularly interested in whether Tsvangirai has married Locadia or
not, it’s none of my business, but the manner in which the issue was handled
by the prime minister and his team reveals a worrying degree of bungling.
Whereas this should have just been handled properly as a family affair,
their inept management of the issue has unfortunately thrown the issue into
the public domain. I feel pity for the families and people involved because
they don’t deserve all this. They are not politicians and hence they should
have been given an opportunity to handle their matters in privacy and peace,
but the premier and his team obviously created all this mess by failing to
clarify the situation timely and decisively.

Leaving, this marriage saga alone, look at the confusion Tsvangirai and his
party have created over electoral reforms. It’s a pity they are not telling
the public the truth. The story is that all parties agreed to those reforms
and now Tsvangirai and his people are backtracking while claiming it’s
others at fault. This sort of inconsistency and being economic with the
truth is what worries some of us. It does not matter whether it’s Mugabe,
Tsvangirai or Ncube making these blunders but the fact remains leaders must
be criticised for bungling.

Take for instance Tsvangirai’s boobs in his flawed Deep End memoirs, the
prime minister desperately seeks to smear Ncube’s reputation through
half-truths and open lies and when we respond he cries foul. The book, which
is also poorly written, structured and edited, is full of misrepresentations
and deceptions deliberately calculated to smear his rivals instead of
telling the story of his life.

All these issues taken individually and collectively raise serious questions
about Tsvangirai’s vision, leadership qualities, sense of judgment and

But then I’m now really wondering whether Tsvangirai needs any critics at
all. He is his own worst enemy — recent events have proved this beyond
reasonable doubt. I think it’s better to leave the guy alone to

Moyo is the National Organising Secretary of the MDC led by Professor
Welshman Ncube. He is contactable on

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MuckRaker: Satellite dishes tell us the true story

Thursday, 01 December 2011 17:25

Under the heading “Sanctions create ‘uneven’ playing field”, the Herald last
week carried remarks by Media, Information and Publicity minister Webster
Shamu saying if the country was to have elections with sanctions in place,
it would create an uneven playing field for Zanu PF.

He was addressing a Chinese delegation on state administration of the media.
“As you are aware,” he said, “we have a political agreement in the country
and Zimbabweans are saying to the international community sanctions are the
main unresolved issue in the GPA.”

What tosh! They are saying no such thing. Zimbabweans want an end to
partisan and unprofessional broadcasting. They want an end to violence and
electoral manipulation. And they certainly don’t want Chinese political
interference in Zimbabwe’s internal affairs.
“It is important for our people to get our true story through our own eyes,
not through third parties that do not protect our national interests,” Shamu
said. “We have to reclaim the space taken forcefully by other media
organisations. The battle for minds can only be won through the generation
of our own news content.”

What we have here is a state-run media that conspicuously failed to win the
battle for hearts and minds at the last election. The electorate voted
overwhelmingly for change. But instead of recognising that outcome,  Zanu PF
maintained its arthritic grip on the public media.
Instead of providing a platform for a variety of views, the state encouraged
Zanu PF to churn out a daily diet of lies and abuse. Worse still, it shut
out the winning party after the last election.

This was a clear violation of ZBC’s public mandate and remains one of many
outstanding issues arising from the GPA. Sanctions could be lifted tomorrow
if political thuggery was halted and the public given the right to choose
their broadcasters. Only last week the licensing process was manipulated to
empower the former ruling party.

Meanwhile, we had a visit from a Chinese delegation which thinks we will
benefit from their expertise in partisan control. Here is another country
that deprives its public of honest and professional broadcasting. Not only
do the people of China suffer a news deficit, but their governing Communist
party abuses the state media to justify their suppression of dissent.

“When the Western media report on the international affairs of developing
countries,” Chinese vice minister Li Wei said, “they are only interested in
chaotic affairs, drought and famine and they always encourage a
confrontation between mass and ruling governments.”

Do they? And who encouraged Zimbabwe’s crackdown on the MDC and civil
society? As for “drought and famine”, our experience of those realities
occurred when the country’s self-sufficiency in food production broke down
in 2008 and we became dependent upon US and EU handouts. Very similar in
fact to Mao’s Great Leap Forward in 1958 except of course China has
subsequently adopted fully-fledged capitalism while Zimbabwe heads the other
The Chinese visit saw the signing of a cooperation agreement, we are told,
between China Central Television and ZBC.
As for “getting  our true story through our own eyes”,  can you imagine our
“true story” coming from Tafataona Mahoso, Sheunesu Mpepereki, Vimbai
Chivaura, and the usual gang!
Anybody in any doubt about getting our true story should go and see the
Mbare flats. The satellite dishes there tell a true story which no amount of
ZTV propaganda can match.

The agreement for cooperation between China Central Television (CCTV) and
ZBC, mentioned above, has been described as a “herald of good development”
within the two countries’ media fraternity.

This was said by Media minister Webster Shamu, at the signing of ZBC‘s
memorandum of cooperation with CCTV. Shamu called on China and Zimbabwe to
harness their “strengths” in the area of collecting and disseminating
The agreement will see the broadcasters exchanging news and current affairs
programmes “in what experts say will be a defining stage in Sino–Zim
relations”, gushed ZBC.

So the Chinese will finally have the benefit of the insightful analyses of
the Tafataona Mahosos and Vimbai Chivauras of this world. We are sure they
are also looking forward to the scintillating and back-crunching moves from
the Mbare Chimurenga choir. We’re sure they can’t wait!

Meanwhile, ZBC’s usual coterie of “analysts” described events unfolding in
Syria as a continuation of the West’s offensive in the Middle East in a bid
to isolate Iran.

“The world continues to witness a new wave of colonialism as the West
continues to infiltrate and dictate the politics in the Middle East by being
catalysts of destabilising the region as evidenced by unfolding events in
Syria,” ZBC observed.
Ironically Syria’s closest ally, Iran, has also called on the government in
Damascus to listen to the people’s “legitimate demands”. Iran’s Foreign
minister Ali Akbar Salehi warned of dangerous regional implications if the
crisis in Syria was not solved peacefully. He said a power vacuum in Syria
would have “unprecedented repercussions’’ among its neighbours.

Unperturbed by this inconvenient truth, Mahoso claimed that Syria is now
being “punished” for its resistance to Israel and US domination of the
Middle East, adding that it will only be a temporary success.
“What we are seeing now is the Western penetration of institutions in Syria
including the split of the army, so that part of the military force is now
joining the so-called resistance,” said Mahoso.

ZBC’s “diplomatic analyst”, Chris Mutsvangwa, chipped in saying the Syrian
issue is further exposing the hypocrisy of the West as the same revolts are
being experienced in Egypt yet there is no talk of the security council
“Following the brutal assassination of former Libyan leader Muammar Gaddafi
by Nato-backed NTC forces, European nations were heaping pressure on Syrian
President Bashar al-Assad’s government to halt what they called a bloody
crackdown against civilians,” ZBC mused.
Should the plight of defenceless civilians be subordinate to the desire of
regimes to stay in power? We think not!

The Herald reported on Tuesday that Zimbabwean “youths” have slammed the
2012 national budget and accused Finance minister Tendai Biti of sidelining
them from participating in the mainstream economy.
Zimbabwe Youth Council chairman Hamilton Pazvakavambwa said the minister was
trying to “reverse” government’s economic empowerment drive.
“It has been an elimination of the empowerment programme by substitution of
the employment agenda. Instead of putting more money to empowerment, he
(Biti) has put US$2 million for (a) jobs fund for companies to employ young
people yet we thought young people were supposed to be entrepreneurs,” he

“His decision for youths to get money through Stanbic is also questionable,”
Pazvakavambwa said. “If Stanbic wants to take a positive step forward into
youth development then why not follow the Old Mutual way and assist in
projects that can see the youth of this nation prosper,” he said.
Pazvakavambwa and his ilk are not concerned about gaining the requisite
skills to be the entrepreneurs they claim they will be. They are part of the
grab-and-loot philosophy that Zanu PF has introduced.
“As young people, we refuse to support anything that ties us to a certain
political following and ideology,” he said.
Oh please! Spare us such drivel. Who doesn’t know that they are lackeys of a
certain archaic party trying to reclaim lost political ground?

Why is PM Morgan Tsvangirai allowing strangers to run his love life? The PM
has not spoken on the steamy affair with Locadia Tembo whom he allegedly
paid US$36 000 for.
His handlers have said that was to compensate for the bun, sorry, buns, in
the oven. But the Zanu PF machinery has taken charge of the saga.
It is Zanu PF which appears to be managing the information from Locadia’s
family and from Tsvangirai’s relatives.
Nathaniel Manheru on Saturday previewed Locadia’s journey to Tsvangirai’s
rural home. He was spot on. The journey materialised amid shrill denials of
the marriage by the PM’s information handlers.  Someone is now running the
PM’s bedroom which is taking power-sharing to extreme levels.
Despite all the denials it looks like Mama Tembo will be getting married to
the PM and soon we will be singing Margaret Singana’s Mama Tembu’s Wedding
And I sighed and I called in the deep of the night
Because never before have I seen such a sight
As the bride Mama Tembu walks out through the door
And the valleys still echoe the sound of the roar

We liked George Clooney’s  statement that he was not at one of Silvio
Berlusconi’s notorious bungabunga parties. In a story carried by the BBC, an
Italian court has ruled that the former prime minister may call Clooney and
footballer Cristiano Ronaldo as witnesses at Berlusconi’s sex trial.
Berlusconi is accused of paying for sex with an under-age prostitute of
Moroccan descent.

The prosecution has drawn up a list of 136 witnesses. In an interview with
Time magazine in October Clooney said he had been called by Berlusconi’s
lawyers but he was not at the party he was said to have been at. “I wasn’t
at his bungabunga party,” Clooney said in reference to Berlusconi’s parties.
“I spoke to their people and said: ‘I will come and testify if you’d like
because I wasn’t at the party I was supposed to be at. I wasn’t at the
bungabunga party’.”

He said he had been at another party which he attended in order to speak
about the humanitarian crisis in Darfur.
Yes, OK then George…

Muckraker was amused by South African comedian Trevor Noah’s sentiments on
Presidency spokesperson Mac Maharaj who is mired in a corruption scandal:
“I humbly request that from now on, instead of Mac, we call him PC Maharaj.
Because only PCs have corruption issues,” Noah said.
Well said.

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Eric Bloch Column: The good, the bad, and the ugly

Thursday, 01 December 2011 17:18

THE  2012 national budget, presented to parliament last week by Finance
minister Tendai Biti, was a pot-pourri of the good, the bad, and the ugly.

The minister  clearly had some regard for certain of the innumerable
submissions made to him at the diverse and wide-ranging consultation
meetings that he and his officials held widely throughout Zimbabwe, albeit
that in various instances, that regard was muted and inadequate.  However,
equally clearly, he totally ignored many other of the submissions,
notwithstanding their critical importance.

To some extent that will have been because of the gross inadequacy of fiscal
resources, but nevertheless, they were of such import to the future of the
economy, and to the well-being of the populace, that limited available
resources should have been diverted thereto, even if to the prejudice of
other budgetary considerations.

The minister must be commended for his continued determination to contain
the state’s immense debt burden and for striving to achieve a budget which
will not necessitate even greater accumulation of debt.  To that end, he
reiterated: “We have to live our motto. We eat what we kill”, avoiding
fiscal sclerosis of unbudgeted expenditures, whether it be on account of
wages, travel, support to ailing parastatals, among others.”  He
emphatically stated that “expenditure management and fiscal control requires
discipline and deep appreciation that nations, like ordinary households,
cannot live beyond their means without paying a price.”  Moreover, he
reinforced this, saying: “It is important that the top leadership of our
Government remain at the forefront of fiscal prudence and discipline in this

Of particular merit in the budget were:

The minister’s recognition of the critical need to address the adequate
funding of education, and the decline in Zimbabwe’s healthcare resources. To
that end, out of total budgeted expenditure of US$4 billion he has allocated
US$1 0032 billion to Education, including funding for infrastructure
rehabilitation at primary, secondary and tertiary levels, and US$345,7
million to Health, also providing for infrastructural needs.

Government’s awareness that, although the economy has attained some growth
(with Gross Domestic Product (GDP) foreshadowed to have increased in 2011 by
9,3%), nevertheless, considerably greater economic recovery is very
critically needed.  Whilst in percentage terms this year’s growth is not
unimpressive, nevertheless it is in real terms fairly minimal, as it has
been attained from a very low basis.  Any percentage of very little remains
very little.

Various customs duties on manufacturing inputs not available from local
sources have been  reduced or suspended, with an attendant benefit to the
survival and recovery of some very embattled industries.  Concurrently,
duties have been increased on a variety of imported products that have
enjoyed unfair competitive advantage over locally-manufactured like goods,
such as clothing, This can be a partial contribution to the continuance, or
resumption, of operations of various industries whose operations were on the
threshold of downsizing.

The tax-free bonus level is raised, with immediate effect, from US$500 to
US$700, which will marginally improve the presently very trying
circumstances of a majority of the employed population.

Some cognisance has been given to the critical need to advance the recovery
of the financial  sector, and its ability to provide working capital funding
to Commerce and Industry, Agriculture, and other economic sectors.  Key to
that objective is restoration of the Reserve Bank’s role as lender of last
resort, to which end it is to be availed of U$100 million funding.

Whilst access to international developmental and loan funding remains very
limited, in part  because of Zimbabwe’s continuing appalling image of
ongoing political instability and its disregard for human rights and key
principles of democracy, nevertheless some progress has been and is being
made in accessing a portion of critically-needed funding.  The Minister
disclosed that development partners pledged US$618,3 million in 2011, mainly
in humanitarian assistance, targeting health, education and social
protection programmes, as well as agriculture, energy, water and sanitation,
and governance.

Counter-balancing these and some other positive features of the budget, were
a variety of bad or negative facets, including:

That except for a declared intent to re-establish the facilitation of
export-processing zones, the
budget contained no incentives whatsoever to motivate and enable export

That to all intents and purposes, nothing is contained in the budget to
incentivise and stimulate investment, be it by way of tax incentives, by
realigning Zimbabwean taxation with that generally prevailing in the region.
Nor was there any proposal to motivate Government to rationalise and make
the grievously investment-destructive Indigenisation and Economic
Empowerment legislation investor – friendly.

That not only did the minister accord totally disregard to comprehensive
representations as to the unrealistic timing of prescribed requirements for
Vat-operators to install fiscalised devices (as desireable as such devices
are for ensuring tax compliance) but, in his Budget Statement, he
emphatically reinforced the immediacy of the fiscalisation obligations.

Whilst the Budget contained not only those, but a number of other, bad
features, it also contained some that were downright ugly, and the omission
of some other were equally, or even more, ugly.

These included that:

With effect from January, 2012, the tax-free threshold is niggardly
increased, from US$225 per month to US$250.  As the Poverty Datum Line (PDL)
for a family of five is currently US$534, the tax-free relief is
contemptuously insignificant with the intent to continue to tax the
poverty-stricken, thereby intensifying their poverty.  Allowing for an
assumption that there are two income-earners in a family, with one earning
somewhat more than the other, the minimum acceptable tax threshold should be
US$300.  How can the minister justify continuing to tax the parlously poor?

The minister disclosed that government has 235 000 civil servants on its
payroll.  Not only is this an incredible, unjustifiable number (earning more
than 63% of total government income), and not conceivably needed to service
a population of approximately 14 million, but it is almost a year since it
was disclosed that 75 000 of the public service employees are ghost workers,
and yet the budget provides for them to continue to be paid.

The budget was wholly silent on the resolution of the US$1,1 billion
accumulated debt of the Reserve Bank.  This continues to destroy
international confidence in Zimbabwe and its economy, discourages Foreign
Direct Investment (FDI), and impedes the desperately-needed, substantive
economic recovery.

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Prosecuting bankers futile

Thursday, 01 December 2011 17:13

By Lance Mambondiani

NICHOLAS Vingirai, an alleged “rogue” banker with an international arrest
warrant, was extradited to Zimbabwe and arraigned before the courts on fraud
charges dating back to the 2003 banking-sector crisis regarding the collapse
of Intermarket Holdings Limited. This is yet another pointless prosecution
of a Zimbabwean banker destined to go nowhere. The global financial meltdown
has been blamed on greedy bankers and excessive risk-taking which became
standard practice on Wall Street in the last decade. Zimbabwe, however, had
its banking crisis way back in 2003 which resulted in a bankers’ purge;
indiscriminate arrest and harassment of leading bank executives.

However, a 10-year pursuit and criminalisation of more than a dozen high
profile indigenous bankers who represented the country’s leading business
brains has ended with no single conviction.

This is certainly the wrong time to be a banker and certainly the worst time
to be a banker with an arrest warrant –– there are few sympathisers. The
“lynch the bankers” public outcry typified by the “Occupy Wall Street”
campaign has been as fervent as the Arab Spring, challenging the dictates
and inequality of capitalism. There is often a sense that bankers exist in a
“Marketopian” island in which there is no sense of value of anything or
anyone beyond price earnings.

The banking crisis in Zimbabwe and worldwide has served to reveal the
vulnerability of the ruling financial order, and reminded many of the
observations by Ricardo Schumpeter that capitalism is given to crisis
especially when overtaken by greed. But greed is not necessarily illegal, in
an open market it is the definition of “business”.

There can be no doubt that some of the Zimbabwean banking executives dipped
their hands in the proverbial till, which could have precipitated the
banking crisis. But a crime is not a crime unless it can be proven in a
court of law. The charges against Vingirai, emanating from his activities as
CEO of a once fledging conglomerate, Intermarket Holdings, will most
certainly count for nothing. The businessman will be left to pick up the
pieces of his empire which, in his absence, was ruthlessly parcelled out to
the state-owned ZB bank. In this regard, he will join casualties such as
William Nyemba, Mthuli Ncube, Julius Makoni and Jeff Mzwimbi who were also
done-in by the system.

The continued pursuit of these bankers on charges which have failed to stand
the scrutiny of any court of law seems retrogressive and a costly exercise
in futility. At worst, it signifies ineptitude by the prosecuting
authorities in which the regulatory authorities appears complicit.

Many would recall that the crisis began with the public humiliation of the
ENG directors who were frog-marched to the Rotten Row courts in leg irons on
allegations of economic sabotage. It was described then as the biggest fraud
case in the history of the banking sector.

Following the acquittal of Nyasha Watyoka and the dropping of charges
against Gilbert Muponda, we now know these allegations were just that;
allegations. ENG has since been irretrievably absorbed into many other
financial institutions such as Interfin Bank, without recompense to its
The causes and consequences of the 2003 banking crisis and the corporate
pilferage in its aftermath may never be officially investigated, but there
are some observations which can be drawn from the prosecution of Vingirai,
and the international outcry against bankers.

First, the root cause of the sub-prime mortgage crisis and the 2003 banking
sector meltdown was regulatory forbearance and a weak and lax enforcement of
the rules by the regulators. Sadly, there is no evidence which suggests that
the current regulatory environment has addressed these regulatory

Second, the major problem with the Zimbabwean banking crisis has been
insider ownership concentration which resulted in corporate governance
weaknesses in private indigenous banks such as insider lending, abuse of
depositors’ funds and speculative activities. As abhorrent as these
practices were, one of the reasons why the central bank has failed to hold
any of the bankers to criminal account is because according to the
legislation at the time, this financial dexterity may have been immoral but
not illegal. This is similar to why the Anglo-Saxon governments have no
capacity to hold bankers to account for the cost of the losses from the
financial bubble they created.

In their current format, the regulatory mechanisms introduced by the central
bank to curtail ownership concentration and stem corporate governance
weaknesses are hardly fit for purpose. The regulations are porous and are
unable to tackle the pervasive agency problems which have been at the core
of the banking crisis.

Addressing weaknesses in the banking sector will hardly be solved by the
prosecution of another banker, but through an overhaul of the regulatory
framework in a less reactionary or draconian way as was the case with the
hastily constructed Corporate Governance Manual introduced in response to
the crisis.

Mambondiani is an Investment Executive at Coronation Financial. The views
expressed in this article are personal and do not necessarily reflect the
position of Coronation Financial.

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SA: A matter of time before bomb explodes

Thursday, 01 December 2011 16:15

Moeletsi Mbeki

I CAN predict when South Africa’s “Tunisia Day” will arrive. Tunisia Day is
when the masses rise against the powers that be, as happened recently in
Tunisia. The year will be 2020, give or take a couple of years. The year
2020 is when China estimates that its current minerals-intensive
industrialisation phase will be concluded.

For South Africa, this will mean the African National Congress (ANC)
government will have to cut back on social grants, which it uses to placate
the black poor and to get their votes. China’s current industrialisation
phase has forced up the prices of South Africa’s minerals, which has enabled
the government to finance social welfare programmes.

The ANC is currently making South Africa a welfare state and tends to
“forget” that there is only a minority that pay all the taxes.  They are
often quick to say that if people (read whites) are not happy they should
leave.  The more people that leave, the more their tax base shrinks.  Yes,
they will fill the positions with BEE candidates (read blacks), but if they
are not capable of doing the job then the company will eventually fold as
well as their “new” tax base.

When there is no more money available for handouts they will then have a
problem because they are breeding a culture of handouts instead of creating
jobs so people can gain an idea of the value of money.  If you keep getting
things for free then you lose the sense of its value.  The current trend of
saying if the West won’t help then China will is going to bite them.  China
will want payment such as land for their people. This will result in an
influx of Chinese since there is no such thing as a free lunch!

The ANC inherited a flawed, complex society it barely understood. Its
tinkering with it are turning it into an explosive cocktail. The ANC leaders
are like a group of children playing with a hand grenade. One day one of
them will figure out how to pull out the pin and everyone will be
killed. …and 20 years on they still blame apartheid but have not done much
to rectify things. Changing names only costs money that could have been
spent elsewhere.

A famous African liberation movement, the National Liberation Front of
Algeria, after tinkering for 30 years, pulled the grenade pin by cancelling
an election in 1991 that was won by the opposition Islamic Salvation Front.
In the civil war that ensued, 200 000 people were killed. The “new” leaders
are forgetting the struggle heroes and the reasons for it. Their agenda is
now power and money and it suits them for the masses to be ignorant – same
as Robert Mugabe did in Zimbabwe.  If you do not agree with the leaders then
the followers intimidate you.

The former British Prime Minister, Margaret Thatcher, once commented that
whoever thought that the ANC could rule South Africa was living in Cloud
Cuckoo Land. Why was Thatcher right? In the 16 years of ANC rule, all the
symptoms of a government out of its depth have grown worse.
l Life expectancy has declined from 65 years to 53 years since the ANC came
to power. A leader who did not believe that HIV causes Aids (Thabo Mbeki)
and another who believes having a shower after unprotected sex is the answer
and has five wives and recently a child out  of wedlock (Jacob Zuma).  Great
leaders for the masses to emulate?  Not!
lIn 2007, South Africa became a net food  importer for the first time in its
history. Yet they want to carry on with  their struggle song “kill the boer
(farmer)” and stopping farm killings does  not seem to be a priority.  They
do not seem to realise where food actually comes from.

lThe elimination of agricultural subsidies by the government led to the loss
of 600 000 farm workers’ jobs and the eviction from the commercial farming
sector of about 2,4 million people  between 1997 and 2007. Yet they want to
create jobs and cause even more job losses — very short-sighted thinking.
lThe ANC stopped controlling the borders, leading to a flood of poor people
into South Africa, which has led to conflicts between South Africa’s poor
and foreign African migrants. Not much thought was given to this — their
attitude was to help fellow Africans by allowing them “refuge” in South
Africa.  Not thinking that illegals cannot legally get jobs but they need to
eat to live.  I believe that most of our crime is by non-South Africans.
They need to do something to survive. Remove the illegal problem and you
solve most of the crime problem.

When they took control of the government in 1994, ANC leaders should have
identified what South Africa’s strengths were, identified what South Africa’s
weaknesses were, and decided how to use the strengths to minimise and/or
rectify the weaknesses. They were too busy enriching themselves.
A wise government would have persuaded the skilled white and Indian
population to devote some of their time — even an hour a week — to train the
black and coloured population to raise their skill levels.

What the ANC did instead when it came to power was to identify what its
leaders and supporters wanted. It then used South Africa’s strengths to
satisfy the short-term consumption demands of its supporters. In essence,
this is what is called Black Economic Empowerment (BEE). It entails putting
people in positions they can cope without making them look stupid. You
cannot “create” a company CEO in a couple of years.  It takes years of work,
starting at the bottom of the ladder. Only some things can be learnt in
books; experience is the most important factor and this is not found in text
books or university corridors.
BEE promotes a number of extremely negative socio-economic trends. It
promotes a class of politicians dependent on big business and therefore
promotes big business’s interests in the upper echelons of government.
Second, BEE promotes an anti-entrepreneurial culture among the black middle
class by legitimising an environment of entitlement. Third, affirmative
action, a subset of BEE, promotes incompetence and corruption in the public
sector by using ruling party allegiance and connections as the criteria for
entry and promotion in the public service, instead of having tough public
service entry examinations. Nepotism is rife –– jobs for friends and
families who are nowhere near qualified and then hire consultants to
actually get the work done — at additional cost of course.

The first purpose of BEE was to create a buffer group among the black
political class that would become an ally of big business in South Africa.
This buffer group would use its newfound power as controllers of the
government to protect the assets of big business.

The buffer group would also protect the modus operandi of big business
thereby maintaining the status quo in which South African business operates.
That was the design of the big conglomerates.

The problem with the formula of BEE is that it does not create
entrepreneurs. People do not develop the necessary skills when being
fast-tracked into a position and being given a free ride. You are taking
political leaders and politically-connected people and giving them assets
which, in the first instance, they don’t know how to manage.

It does not add value. One is faced with the threat of undermining value by
taking assets from people who were managing them and giving them to people
who cannot manage them. BEE is thus creating a class of idle rich ANC
My quarrel with BEE is that what the conglomerates are doing is developing a
new culture in South Africa — not a culture of entrepreneurship, but an
entitlement culture, whereby black people who want to go into business think
that they should acquire assets free, and that somebody is there to make
them rich, rather than that they should build enterprises from the ground.

But we cannot build black companies if what black entrepreneurs look forward
to is the distribution of already existing assets from the conglomerates in
return for becoming lobbyists for the conglomerates. All companies start
from the bottom. When they are “given” these businesses they are usually run
into the ground because of inexperience.  And when they are given loans to
buy business the loans invariably are not repaid and the businesses go

The third worrying trend is that the ANC-controlled state has now
internalised the BEE model. We are now seeing the state trying to implement
the same model that the conglomerates developed.

What is the state distributing? It is distributing jobs to party faithful
and social welfare to the poor. This is a recipe for incompetence and
corruption, both of which are endemic in South Africa. This is what explains
the service delivery upheavals that are becoming a normal part of our

A socialist model, along the lines of the Soviet Union, is not workable
today. The creation of a state-owned economy is not a formula that is an
option for South Africa or for many parts of the world. Instead of shuffling
pre-existing wealth, we have to create new entrepreneurs, and we need to
support existing entrepreneurs to diversify into new economic sectors.

Make people work for their “handouts” even if it means they must sweep the
streets or clean a park. Just do something instead of getting all for
nothing.  Guaranteed there will then be less queuing for handouts because
they would then be working and in most instances they do not want to work ––
they want everything for nothing.

And in my opinion the ANC created this culture before the first election in
1994 when they promised the masses housing, electricity etc. They just
neglected to tell them that they would have to pay for them.  That is why
the masses constantly do not want to pay for water, electricity, rates on
their properties. They think the government must pay this — after all they
were told by the ANC that they will be given these things. They just do not
want to understand that the money to pay for this comes from somewhere and
if you don’t pay you will eventually not have these services.

Mbeki is the author of Architects of Poverty: Why African Capitalism Needs

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Independent Comment: Zanu PF conference: Time to break mold

Thursday, 01 December 2011 18:26

ZANU PF, in power for 31 years albeit now by technical means, meets in
Bulawayo for its annual conference from Tuesday to Saturday to take stock of
the year and discuss issues it deems important. The agenda of the conference
lists, among other issues, indigenisation and empowerment. This issue has
had serious negative impact on the economy and needs to be settled to avoid
further haemorrhaging confirmed in the budget last week.

The conference agenda does not have the party’s controversial leadership
renewal and succession topic — currently the most key question which affects
the party and the future of the country. There can be no gainsaying
President Robert Mugabe’s future is critical to Zanu PF survival and the
nation’s prospects. Given the current political and economic environment,
Zanu PF, currently in a precarious state of flux, should take advantage of
the conference in Bulawayo to trigger a sustainable process to resolve its
drawn-out succession crisis and other internal problems which threaten to
destabilise not just the party itself, but also the nation at large.

That is why the Bulawayo conference would be interesting, not so much
because of what will be discussed officially, but what will come out on the
sidelines of the event. Succession would be a catchphrase in private and
hushed discussions. The only problem is that now without the late retired
army commander General Solomon Mujuru, Dumiso Dabengwa and Simba Makoni, no
one in Zanu PF after Emmerson Mnangagwa’s horrific experience in 2004 would
break the ice on succession. The remaining spineless party officials fear
Mugabe and would rather sing praises or keep quiet than challenge him on

Since the conference would be as good as congress, as Mugabe repeated
yesterday, they should take advantage of the platform to initiate a process
to unravel its knotted succession dilemma which has become a tiring yet
still pertinent issue. The conference will come against a backdrop of
political uncertainty about the future of the party and country, as well as
stuttering economic and social volatility. The situation is still far from
steady and certain. This is worsened by the spectre of elections expected
next year or in 2013. Whatever Zanu PF would decide on the elections, it has
to be subjected consultations based on GPA processes before the polls.

Although Zanu PF remains divided and fractured, it is hoping victory at the
elections will power Mugabe to the top as the undisputed leader, give them a
fresh and full mandate and help resolve their succession conundrum. This
explains the rush to go the polls when Mugabe is still fit. Quite clearly,
the party thinks it has recovered from the 2008 defeat to stage a comeback.

However, the fact remains, internally, Zanu PF, which has been thoroughly
eroded ideologically and organisationally, lacks cohesion largely due to
exhausted vision and tired leadership. Mugabe’s leadership is now being
questioned openly inside and outside the party. There is a near-consensus
Mugabe is tired and can no longer offer effective and dynamic leadership.
Most senior Zanu PF officials want him to go.
Unless radical and sweeping renewal measures are undertaken, the party may
soon lurch from the political twilight zone it is in towards complete
darkness and obscurity, as the sun rapidly sets on its fairly long reign.

This gloomy picture of the situation is increasingly becoming a reality as
the party now finds itself battling for political survival in the midst of a
divisive and debilitating power struggle, at a time when Mugabe, at the helm
for 34 years, is facing the exit due to old age and health problems.

Dogged by an explosive and crippling succession crisis, internal strife and
a battered reputation due to leadership and policy failures, as well as a
dreadful record of violence, human rights abuses and corruption, Zanu PF now
faces the same fate as other former liberation movements in the region.

The party can remain in denial about this but the reality is that is has
imploded in many respects. It is surviving only because it is being propped
up by the state. The security structures are actually now the Zanu PF
backbone. Without them, Mugabe and his party will collapse like a deck of
cards. Because of the state security structures and now the Marange diamonds
(which the military and their surrogates would fight for to the bitter end),
Zanu PF has been able to buy time in power.

However, without leadership renewal and vision, as well as resolving the
succession issue, the party will eventually crumble. The problem is fear of
the unknown and the Bulawayo conference should break the mold.

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Editor’s Memo: BEE hijacked into a party project

Thursday, 01 December 2011 18:24

Constantine Chimakure

ZANU PF has finally let the cat out of the bag! The indigenisation programme
has nothing to do with genuine economic empowerment of the masses, but has
everything to do with securing political papacy for President Robert Mugabe
in the next elections. Speaking to journalists after Wednesday’s politburo
meeting, party spokesperson Rugare Gumbo confirmed our worst fears that the
indigenisation drive, like the chaotic land reform in 2000, would be
hijacked by Zanu PF and used as campaign mantra to prop up Mugabe’s
dwindling support as has been the case with other Zanu PF trump cards.

Dismissing Tsvangirai’s chances of out-polling Mugabe in the next elections,
Gumbo said: I don’t know whether he really has the courage, capacity and the
ability to beat what President Mugabe has done for his country, for example
the indigenisation programme.

“You cannot get anything better than Zanu PF programmes that are concrete,
credible but we will see when we get there.”

It is now clear that the indigenisation programme is Zanu PF’s last trump
card, without it the party will have to write its own political epitaph.

We agree absolutely that equitable distribution of resources is needed to
address the historical imbalances, but we can never
supportproperty-grabbing.The callousness and impunity with which the
land-grabs were implemented — after the Zanu PF government lost the February
2000 constitutional referendum — should never be repeated. The end result
was the decimation of the agriculture sector, the backbone of the economy.

While the concept of indigenisation and empowerment are noble, we don’t
subscribe to the way Zanu PF and Mugabe want to execute it. The Mugabe drive
does not encourage innovation, ingenuity and entrepreneurship. It’s not
about wealth creation, but grabbing, all in the name of securing victory for
Mugabe and his party.

The government programme has been hijacked into a party project. This
explains why Mugabe has been officiating at all the share-ownership schemes

Gumbo also insisted that elections would be held next year without fail.
However, as stated ad infinitum, the political and economic situation in the
country is not conducive for the holding of elections anytime soon. Besides
Mugabe, who else in the country wants elections? MPs from Zanu PF and the
MDC formations, the business community and ordinary Zimbabweans have said no
to the polls. They want genuine reforms to guarantee a peaceful, free and
fair election where the loser will congratulate the winner in magnanimity.
The electorate want to be assured of a peaceful transfer of power in the
event Mugabe loses.

We have said and it is worth repeating that early polls are not in the best
interests of Mugabe and his party.

There is no way that Mugabe and Zanu PF can win a free and fair poll given
their history of failure in government. The party should, at its conference
next week, work on reforming itself through leadership renewal. It needs
time to revive its party structures and woo, not coerce, supporters.

In Tsvangirai’s case, the former firebrand trade unionist is guaranteed
electoral victory whether the polls were to be held tomorrow, 2013 or 2015.
Why is Mugabe in a rush to dissociate himself and his party from Tsvangirai
who gave him legitimacy by agreeing to enter the inclusive government?

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Candid Comment: Now that the budget is over

Thursday, 01 December 2011 18:23

Itai Masuku

LISTENING to the budget presentation last week, one was convinced that the
main problem with budgetary issues in Zimbabwe are that they are designed to
solve immediate issues and its aspects are done piecemeal and therefore risk
not having sustainable impact.

It is really time that any Minister of Finance should present a  five-year
budget, irrespective of the fact that their party might not be the one  in
power after the next election. Each subsequent annual budget should be a
review of how we’ve moved on the roadmap and what changes need to be made
towards the destination we’ve set ourselves.

No wonder Hilary Clinton in her congratulatory speech to Barack Obama on his
election as the Democrats’ presidential candidate, reminded the now first
black US president that the office of the US president is a straitjacket,
one which required the incumbent to fit into it and not the other way round.
The point is the template is there and the incumbent should merely work
according to it. This assumes think tanks are the ones who’ve set the
template and what are required are those to execute. The think tank would
have had the budgets approved by parliament who in all reality should be the
owners of the financial plans of their constituents.  Now in our case, a new
template is cut everytime there is a new incumbent.

This is much like being on a bus whose destination changes according to the
driver. Some passengers will grumble, even if the new driver is taking them
to a sunny beach. Subsequent governments should at least try to understand
the template and improve on it, not just change for the sake of changing.
The recent attempt to introduce the Medium term plan is a step in the right
direction, and, as we said, as long as such programmes are implemented.

Biti made reference to the MTP in his preamble. Given that we now have
separate ministries of Economic Planning and Investment Promotion on the one
hand and Finance on the other, it would appear the role of the Finance
ministry should be subservient to that of Economic Planning and
InvestmentPromotion. Thus the Ministry of Economic Planning should be the
think tank that gives guidance to the budgetary process. It should then be
the one that carries out the consultation processes prior to the budget.
And by think tank, one doesn’t mean that the knowledge resides in this
ministry  alone. The ministry should perhaps co-ordinate a think tank that
comprises its economists and those from , say, universities, the Reserve
Bank, private practice etc, and strategists from other ministries,  the
banking industry, industry and commerce, etc.

We once had such an institution before in the form of the Zimbabwe Institute
of Development Studies. However, this institution seemed to be premised on
politics.Adozen years ago, the office of the Planning Commissioner was
introduced. It was the same office that came up with the Millennium Economic
Recovery Programme (Merp), which as we know, gathered dust. This is not to
say Merp was a useless document.

In fact it may be one of the few economic policy documents that showed the
government then was having a reality check. While it formulated the policy
document, it neither had the mandate nor capacity to implement its policies.
So again, it was a case of the left hand doing its own thing while the right
hand did its own. Our country cannot afford to go on this way. We need a
strategic and visibly co-ordinated operation among line ministries to
increase government’s efficiency.

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