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EU to extend sanctions on Zimbabwe - diplomats

Reuters

Fri Feb 2, 2007 5:45 PM GMT

By Ingrid Melander

BRUSSELS (Reuters) - The European Union is set to extend sanctions on
Zimbabwe for another year including an arms embargo, travel ban and asset
freeze on President Robert Mugabe and other top officials, EU diplomats said
on Friday.

The 27-member bloc, which accuses Harare of widespread human rights
violations, plans to go ahead with the move despite the risk that the travel
ban on Mugabe could again scupper longstanding plans for an EU-Africa
summit, they added.

The list of visa bans and freezing of assets includes more than a hundred
ministers and officials. The EU accuses them of human rights violations, and
violations of freedom of speech and assembly in Zimbabwe.

"They will be prolonged for another year," an EU diplomat said of existing
sanctions due to expire on February 20.

"Every year the European Commission does a report on the situation in
Zimbabwe, it has not changed so the conclusions are the same," said an
official at the EU executive.

The sanctions were initially triggered by the controversial distribution of
white-owned commercial farms to mainly landless blacks and Mugabe's disputed
re-election in 2002.

Critics say the seizures have destroyed Zimbabwe's economy, turning the
country from a regional agricultural leader to a nation barely able to feed
itself amid a deepening crisis marked by food and fuel shortages and
inflation above 1,200 percent.

Mugabe says the sanctions are responsible for Zimbabwe's economic crisis and
he says his land policy was necessary because former colonial power Britain
did not make good on promises at the time of Zimbabwe's independence in
1980.

Eldred Masunungure, chairman at University of Zimbabwe's Political Science
Department, said the EU sanctions have failed to reach their objective and
have if anything hit the population of Zimbabwe.

"I think the sanctions by their very nature are a blunt instrument and their
impact tends to spread beyond the target persons," Masunungure said.

"On the government's side they have been felt but as you can see Mugabe has
not changed his policies."

Plans for an EU-Africa Summit have been on hold since 2003 because Britain
and several other EU countries refused to attend if Mugabe was invited,
while African states refused to attend if he was not invited, diplomats
noted on Friday.

"The big issue of course is how to organise this summit," one said, adding
that the EU may try to convince Zimbabwe and other African countries that
Zimbabwe be represented at that summit by a senior official who is not on
the embargo list.

"We will need good political will and some imagination," another said,
noting that Britain and possibly other countries would oppose to a temporary
lift of the visa ban to allow Mugabe to come to an EU-Africa Summit.


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Mugabe question sparks controversy ahead of EU-Africa summit

EUobserver

02.02.2007 - 09:26 CET | By Lucia Kubosova
With EU member states planning to update sanctions against the authoritarian
government of Zimbabwean president Robert Mugabe, France and Portugal are
considering whether to use loopholes in the EU travel ban and invite him to
key summits.

The EU is on 20 February expected to formally prolong the five year long
sanctions against the African country - first put in place in 2002 after
European observers were not allowed to watch over dubious Zimbabwean
elections.

The measures restrict the travel of 72 Zimbabwean government officials and
people close to them, including president Mugabe himself, in retaliation for
human rights abuses in the country.

But specific exemptions form the rule already allowed the French president
Jacques Chirac to host Mr Mugabe in February 2003 at a France-Africa summit,
and Italy to let the Zimbabwean leader visit the funeral of Pope John Paul
II in April 2005.

According to UK daily the Guardian, Paris is again considering inviting Mr
Mugabe to a France-Africa summit taking place in Cannes on 14 February, with
a French official telling the daily "The invitations are still being sent.
The list will be published only later."

Portugal - set to chair the EU for six months from July - is considering a
similar move, according to the newspaper. But this would involve the whole
27-member bloc as Lisbon plans to organise a major EU-Africa summit as a key
event during its presidency.

The idea is controversial not only because of strong opposition within
Europe - particularly in the UK - but also as it could lead to other African
leaders, mainly from South Africa, boycotting the meetings.

Robert Mugabe has been in power in Zimbabwe since the country's independence
in 1980.


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Anxious times for white Zimbabwe farmers

Mail and Guardian

Harare, Zimbabwe


      02 February 2007 03:30

            Zimbabwe's remaining white farmers were anxious on Friday ahead
of a February 3 deadline for many to leave their farms, a farming official
said.

            Many of the more than 400 whites still farming out of an
original 4 500-strong community have been given until Saturday to vacate
their farms to make way for new black farmers.

            In early January, President Robert Mugabe's government said
white farmers would be allowed to stay on their farms for an extended period
to harvest their crops.

            But the government has continued to send out 45-day eviction
notices that expire on Saturday, leaving farmers confused and anxious about
their rights, said Emily Crookes, spokesperson for the white-run Commercial
Farmers' Union (CFU) said.

            The Lands Ministry has continued to issue eviction notices
around the country, Crookes told the media in a telephone interview.

            "At least 30 eviction notices have already been issued to
farmers this year, 24 of them to landowners in the southern Chiredzi
district," she said.

            "Farmers are anxious out there because they're not sure which
way this is going to turn," Crookes said. "We're hoping it will be calm."

            Farmers in Chiredzi are hopeful the government will abide by its
promise to allow them to harvest their crop.

            Zimbabwe Cane Farmers' Association chief executive Stephen
Schwarer said in a telephone interview from Chiredzi that farmers in his
area were not anticipating trouble on Saturday.

            "We're assuming there's a stay of execution," said Schwarer,
whose association represents 200 black and 50 white cane farmers.

            "There's no indication there will be any trouble or pressure for
us to leave this weekend," he said.

            In 2000, Mugabe's government launched a controversial programme
of farm seizures, accusing white farmers of supporting the fledgling
opposition Movement for Democratic Change party, which almost defeated
Mugabe's ruling Zanu-PF in general elections that year.

            Last week, Lands and Security Minister Didymus Mutasa said only
farmers who had shown goodwill towards Mugabe's government would be allowed
to continue farming.

            He also warned white farmers that the government had teeth and
would use them to bite those who resisted the takeover of their properties.

            Zimbabwe, once dubbed the breadbasket of Southern Africa, now
has to import food to feed its population of nearly 12-million people.

            There has been a massive decline in agricultural output, once
the mainstay of the economy, as many of the new black farmers lack capital
or experience to maintain production levels. -- Sapa-dpa


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Jag Urgent Cautionary and Advisory Communique to all In-Situ Farmers

Email: jag@mango.zw : justiceforagriculture@zol.co.zw

JAG Hotlines: 011 610 073, 091 233 415.  If you are in trouble or need
advice, please don't hesitate to contact us - we're here to help!

------------------------------------------------------------------------------

For those farmers still in-Sutu on their farms (productive or otherwise),
most of whom will fall under the 45-day eviction period as prescribed under
the Gazetted Farms (Consequential Provisions) Act: the 45-day period, which
commenced on 20th December 2006, expires tomorrow - Saturday 3rd February
2007.

Some months ago, Minister Mutes, way ahead of the promulgation of this
legislation, commenced the issuance of 'Eviction Notices' to vulnerable
farmers.  To date, approximately 150 of these so-called 'Eviction Notices'
have been delivered to farmers countrywide.  Even prior to the legal clock
ticking on 20th December 2006, many farmers had come under intense eviction
pressure.  This pressure has continued to intensify and nearly 50 farmers
have been forcibly and illegally evicted to date.

Unfortunately, some farmers, intimidated by this legislation, saw fit to
voluntarily comply - which we have advocated strongly against, in that this
is tantamount to an admission of guilt for being rightfully on one's farm.
We have strongly advised that in-situ farmers should remain on their farms
and face arrest and possible prosecution.  This is the only way that a
farmer can effectively resuscitate his day in Court and with it, a chance of
a fair hearing.  Obviously and fortunately, these matters can not be
progressed at District Magistrate's Court level because of the values of
property involved and, as such, must be referred up to the High Court.  In
the High Court one is likely to be treated more fairly, especially in the
light of judicious publicity.  Bail conditions, therefore, seem likely to be
the order of the day.

It is important to note that 'Eviction Notices' served on farmers to date by
the Minister, via the Ministry, are not competent eviction notices.
Fortunately, only a competent court, in this case the High Court, can issue
a competent Eviction Notice and only then on the basis of a conviction.
THERE CAN BE NO LEGAL EVICTION WITHOUT CONVICTION, IN A COMPETENT COURT.

It is the Trust's contention that - in the light of recent events and
illegal eviction pressure over the past few months, way ahead of the
legislation and legislated time clock deadline - the outcome of this weekend
may, to a certain extent, be dampened and we could be faced with an
altogether damp squib.  However, being prepared for the worst and hoping for
the best, seems an apt maxim in our troubled times.

No-one has a crystal ball as to what will actually happen tomorrow (3rd
February, 2007).  However, being a Saturday, security and law enforcement
agencies could see fit, as a means of harassment, to arrest and lock farmers
up over the weekend.  The JAG Trust strongly advises, especially those
farmers under intense pressure, against falling prey to this strategy and
recommends that such farmers should take time out from their farms for a
spot of stress management and sanity maintenance, with a view to facing any
possible music come Monday.

The JAG Trust will remain vigilant and our hotlines below will be available
in case of emergencies.  We also have on standby legal representatives and
medical help should the need arise.

The JAG Team


Hotlines:

011 610 073

091 233 415


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Board of inquiry to investigate near mutiny at military academy



By Tichaona Sibanda
2 February 2007

The Zimbabwe National Army commander has reportedly ordered a board of
inquiry to investigate circumstances surrounding last week's disturbances at
the Gweru based Zimbabwe Military Academy (ZMA).

On Tuesday we revealed that the Military Academy was sealed off last week,
following a standoff between army cadets and their instructors over
salaries. It's reported the army saw this as a near mutiny.

MDC's Mutare north MP Giles Mutsekwa said the board of inquiry convened by
General Phillip Sibanda comprises senior army officers and includes the
commandant of the ZMA. The inquiry began hearing evidence on Monday,
according to Mutsekwa.

The strike by the trainee soldiers over salaries is the first of its kind in
the history of the Zimbabwe National Army and it's feared it could have
serious repercussions for the instigators.

Mutsekwa, who is also Morgan Tsvangirai's military adviser, said the
standoff is being regarded as very serious in the army and could signal the
end of the cadets' military careers. The number of cadets involved is not
known, but it's believed they've all been detained incommunicado inside the
military fortress, pending the conclusion of the inquiry.

'I think the issue that triggered this standoff is that all these regular
cadets at the ZMA are people who have not been or are not connected
whatsoever with the history of the liberation struggle. Therefore during
their training they're there purely as professionals, they don't want to be
indoctrinated by the usual Zanu (PF) propaganda,' Mutsekwa said.

The atmosphere at the academy is reportedly still very tense with a lot of
officers from the cadet wing being viewed with suspicion for allegedly
influencing the cadets to stand up for their rights.

Relatives of the cadets involved have not been allowed to see them and there
are fears they may have been brutally interrogated. The standoff and
subsequent investigations have been ignored by the state media.



SW Radio Africa Zimbabwe news


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Students threaten class boycotts over high tuition fees



By Lance Guma
02 February 2007

The Zimbabwe National Students Union (ZINASU) has issued a statement
threatening a class boycott if the government fails to withdraw
controversial tuition fee increases. Government increased fees between 300%
and 2000% depending on the courses. The students body have given 13th
February as the deadline for their demands to be met saying they will begin
class boycotts on the 14th of this month. According to research undertaken
by ZINASU more than 31% of the student population has dropped out from
college since February 2006, when government began to roll out a spate of
tuition fee increases.

The student body's National Executive Council (NEC) met on Friday and
amongst other demands called on the government to allocate 26% of the
national budget to education, in line with recommendations by the United
Nations Educational Scientific and Cultural Organisation (UNESCO). 'Everyone
has a right to education. The fees being charged in all the colleges in
Zimbabwe are a clear insult to our parents; most of them are poor peasant
farmers and civil servants who are living way below the poverty datum line,'
Promise Mkwananzi the ZINASU president told Newsreel.

He says students are also clearly aware the bulk of their problems are
political and that only under a new, people driven constitution could things
change in the country. ZINASU meanwhile expressed its support for the strike
by the doctors, nurses and teachers adding that although they sympathised
with the patients who are suffering, those on strike had legitimate
grievances.



SW Radio Africa Zimbabwe news


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Top Politicians Implicated in Illegal Gold Deals




The Herald (Harare)

February 2, 2007
Posted to the web February 2, 2007

Tandayi Motsi And Freeman Razemba
Harare

SOME politicians have been implicated in illegal gold mining activities
while others have tried to interfere with police operations but the force
has stood firm resulting in 113 people being prosecuted and jailed.

Police Deputy Commissioner Godwin Matanga yesterday said some MPs were
involved in illegal mining activities while some ministers had tried to
interfere with their clampdown on illegal mining.

Deputy Comm Matanga said the involvement of the politicians in illegal
mining emerged during police's Operation Chikorokoza Chapera/Isitsheketsha
Sesiphelile, launched to deal with illegal mining.

He was speaking before the Parliamentary Portfolio Committee on Mines,
Environment and Tourism.

Deputy Comm Matanga was responding to questions from MPs during a
presentation of oral evidence on concerns raised by various stakeholders on
the police blitz.

Home Affairs Secretary Mr Melusi Matshiya and other senior police officers
attended the hearing.

Kariba Member of the House of Assembly Cde Shumbayaonda Chandengenda
(Zanu-PF) said when the operation was launched there was little information
about it and this resulted in confusion.

He said some small-scale miners had accused the police of harassment.

In response, Deputy Comm Matanga said some politicians were involved in
illegal gold mining activities.

He said the politicians who were against Operation Chikorokoza
Chapera/Isitsheketsha Sesiphelile had vested interests as they were
benefiting from the corrupt activities.

"Some Members of Parliament are being implicated in the illegal mining
activities. That is as far as I can say," he said.

Asked by the chairperson of the committee, Mr Joel Gabuza Gabbuza, whether
some ministers were interfering with the operation, Deputy Comm Matanga
said: "Yes, Mr Chairman."

He said he was not in a position to elaborate on the involvement of some
politicians in the nefarious mining activities.

Police, Deputy Comm Matanga said, would continue carrying out their mandate
without fear or favour.

On complaints by some small-scale miners that they were allegedly being
ill-treated by the police, he said such cases should be reported so that the
culprits would be brought to book.

"We have no reason to sweep that dirt under the carpet. No ways," he said.

Deputy Comm Matanga said some

small-scale operators were involved in gold smuggling.

He said in Bulawayo police had recovered 420kg of gold ore, which if
processed would weigh 320kg that was meant to be siphoned out of the
country.

Snr Assistant Comm Charles Mufandaedza, who is commanding the operation,
told the committee that diamonds worth $6 billion were recovered in the
Chiadzwa area of Manicaland.

Security agents had been deployed along the Mutare-Beitbridge Road to curb
the illegal buying of diamonds by foreign nationals.

Snr Asst Comm Mufandaedza said more than 20 000 illegal panners were
operating in Chiadzwa, 90km from Mutare, when the police moved into the area
but the situation was now under control.

He said the 600-hectare area in which the mining activities were being
conducted had been ring-fenced although the diamond deposits were believed
to cover 67 000 hectares.

Snr Asst Comm Mufandaedza said the gold ore that had been confiscated from
the miners would be kept as exhibits and would be returned to them if
exonerated from illegal dealings.

Mr Matshiya said apart from environmental degradation, the illegal
small-scale miners were also involved in other criminal activities such as
stock theft.

The operation, he said, would continue until there was sanity in the mining
sector.

The MPs wanted to know what the Ministry of Mines and Mining Development was
doing to normalise the situation in view of the fact that gold production in
the small-scale sector had ground to a halt.

A senior official, Mr Valentine Vera, said the ministry was currently
renewing licences for the miners who fulfilled the regulations.

He said so far about 40 licences had been renewed.

The ministry, Mr Vera said, was also exploring the possibility of making
Environmental Impact Assessment (EIA) reports affordable to the miners as
currently more than $2,4 million was needed to compile and lodge the
reports.

He said the small-scale mining sector was a key player in gold production as
it contributed half of the 22 tonnes produced in 2004.

At least 27 994 people have been arrested countrywide while 31,8kg of gold
worth more than $508 million having been recovered under the operation.

Operation Chikorokoza Chapera/Isitsheketsha Sesiphelile is being jointly
conducted by the police, Reserve Bank of Zimbabwe and other arms of
Government.

In a related matter, 113 illegal gold dealers and panners have been
convicted and jailed two for years each with hard labour, without the option
of a fine.

The dealers and miners were arrested under Operation Chikorokoza
Chapera/Isitsheketsha Sesiphelile.

Midlands province had the highest number of those jailed with 87,
Mashonaland West (13), Mashonaland Central (10) and Matabeleland South (3).

Police spokesperson Inspector Jessie Banda yesterday said the implementation
of the Finance Act Number 2 of 2006, which came into force on January 5 this
year, was of immense assistance to them.

Insp Banda said the Act had removed discretionary or suspended sentences and
made custodial sentences mandatory.

The law has also enabled police to effectively deal with illegal gold
panners, as it prohibits dealing in or possessing gold by unauthorised
persons.

She said the majority of those convicted were gold panners who were arrested
for prospecting for gold without a licence.

"It is our fervent hope that the nation at large will co-operate with the
police during the execution of the operation for the benefit of us all and
future generations," said Insp Banda.

The operation was launched on November 21 last year.


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France urged to take stand on Zimbabwe

From the Zimbabwe Vigil


Vigil supporters took part in a demonstration outside the French Embassy in
London on Friday, 2nd February, demanding that France stop sitting on the
fence about Zimbabwe.

The demonstration was organised by ACTSA (Action for Southern Africa) to put
pressure on the French government following suggestions that it might invite
President Mugabe to the Franco-African Summit in Cannes from 14 - 16th
February.  Euan Wilmshurst, the Director of ACTSA, which is the successor to
the Anti-Apartheid Movement, said he wanted an assurance that France
supports the renewal of targeted sanctions against Mugabe and his cronies.
These prevent leading members of the regime travelling to the European
Union.

The demonstration was attended by some 50 people, including Kate Hoey MP,
the Chair of the All-Party Parliamentary Group on Zimbabwe.  She said it was
important that the sanctions were renewed when the matter came up again in
Brussels later this month.  The bulk of the demonstrators were trade
unionists, including some prominent union leaders who expressed outrage at
the brutal treatment of trade unionists in Zimbabwe.  They carried banners
reading "Respect Workers' Rights in Zimbabwe", "Drop Charges against Trade
Unionists" and "Honour the EU Zimbabwe ban".

Vigil co-ordinator

The Vigil, outside the Zimbabwe Embassy, 429 Strand, London, takes place
every Saturday from 14.00 to 18.00 to protest against gross violations of
human rights by the current regime in Zimbabwe. The Vigil which started in
October 2002 will continue until internationally-monitored, free and fair
elections are held in Zimbabwe. http://www.zimvigil.co.uk


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ZANU PF resolves to fire Tekere

Zim Online

Saturday 03 February 2007



By Prince Nyathi

HARARE - The ruling ZANU PF party's supreme decision-making body the
Politburo, on Wednesday resolved to fire former secretary general Edgar
Tekere for allegedly denigrating President Robert Mugabe.

At a meeting held at the party's headquarters in Harare on Wednesday, Mugabe
is said to have personally brought up the matter for discussion.

But the Politburo is said to have failed to adopt the resolution to fire
Tekere after some members raised procedural matters on the motion.

Sources within ZANU PF say there was resistance over the move to fire Tekere
with some members saying the Politburo did not have powers under party's
constitution to handle disciplinary matters.

"According to the party's constitution, the matter is supposed to be dealt
with at the party's branch level because Tekere is an ordinary card-carrying
member," said a member of the Politburo who refused to be named.

"After the branch has made its recommendation, it then submits the decision
to the district, which in turn submits to the province then the national
disciplinary committee chaired by Nkomo.

"It will then hand it over to the central committee for final decision. But
President Mugabe realising that the members at the branch level are too
junior to Tekere, has decided to ignore the constitution and handle the
matter himself," he said.

The sources told ZimOnline that some Politburo members felt firing Tekere
for exercising his democratic right to free speech would impact negatively
on the party's already battered image.

After debating the matter, the Politburo asked the presidium to look further
into the matter. The ZANU PF presidium is made up of Mugabe, vice-presidents
Joice Mujuru and Joseph Msika and national chairman John Nkomo

Only Mugabe and Mujuru were at the meeting last Wednesday.

Tekere, once a key ally of Mugabe, was fired from ZANU PF in 1988 after
criticising plans by the veteran president to set up a one-party state. He
was however readmitted into the party last year.

The firebrand nationalist last month launched his fiery autobiography, A
Lifetime of Struggle, which ZANU PF officials say distorts the history of
the 1970s liberation struggle.

He also blames Mugabe in the book for ruining the country's once vibrant
economy.

The ZANU PF women's and youth leagues have already called for Tekere's
expulsion from the party accusing the veteran nationalist of denigrating
Mugabe.

ZANU PF spokesperson Nathan Shamuyarira could not be reached for comment on
the matter. - ZimOnline


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Though Seen As Potential Mugabe Successor, Zimbabwe's Gono Burdened By Economy

VOA




      02 February 2007


Meeting business leaders in Bulawayo on Friday in the wake of his monetary
policy statement earlier in the week, Reserve Bank of Zimbabwe Governor
Gideon Gono said some ruling party members want to drag him into their
succession battles.

Gono declared on Wednesday that he would not devalue the Zimbabwe dollar
though its value on the parallel market has plunged to about Z$5,000 to the
U.S. dollar while his bank has kept the official rate at Z$250 since a July
currency overhaul. He also blamed the country's 1,205% inflation rate on
runaway government spending.

His comments on the struggle within the top ranks of the ZANU-PF party to
succeed President Robert Mugabe further put some additional distance between
Gono, seen as a potential presidential contender, and the apparatus of the
ruling party.

But Gono is burdened with his economic record, as Movement for Democratic
Change faction leader Arthur Mutambara noted. He told reporter Blessing Zulu
of VOA's Studio 7 for Zimbabwe that Gono's monetary policy statement was an
admission of failure.

Economic observers add that Gono's policy statement isn't likely to be of
much help in Zimbabwe's relations with the International Monetary Fund. The
board of the global lender of last resort will consider Zimbabwe's
membership status later this month.

An IMF mission in Harare late last year was critical of the Reserve Bank's
extensive financing of operations of government ministries and state
enterprises. Such quasi-fiscal activities have meant printing large amounts
of money, fueling inflation.

An IMF analysis to be presented to the executive board says such
quasi-fiscal funding accounts for 83% of total central bank assets - loans,
in the language of bankers.

Most of these loans to state-owned firms are unlikely ever to be repaid,
leaving a huge hole in the central bank's balance sheet which Gono proposes
to fill by shifting these doubtful loans to a new special-purpose RBZ
subsidiary called Fiscorp, which will administer the loans and attempt to
collect on them from borrowers.

Experts say this is unlikely to impress the IMF board, particularly if the
Reserve Bank continues to fund government overspending. There is also the
issue of $127 million in debt arrears to the Fund, and the government's
continuing disregard of IMF policy prescriptions - first and foremost its
repeated urgings to rein in huge deficits.

Chief Economist Prosper Chitambara of the Labor and Economic Development
Research Institute in Harare predicts that IMF sanctions - suspension of
Zimbabwe's membership and Fund borrowing privileges - will stay firmly in
place for now.

Economist John Robertson told reporter Blessing Zulu that the RBZ will
continue to fund government overspending and Harare will remain in disfavor
at the Fund.



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RBZ Monetary Policy Statement - Mutambara responds

zimbabwejournalists.com


By Arthur Mutambara


Why a Monetary Policy Statement (MPS)?

In terms of the Reserve Bank Act of Zimbabwe, the Governor is required by
law to issue a monetary policy review each year, which should among other
things, discuss current economic and financial trends in Zimbabwe - as well
as outline policy initiatives on maintaining price stability and exchange
rate management.

Essentially, the basic objective of any Monetary Policy Statement (MPS) is
to attain and preserve a low and stable rate of inflation. While both the
global and regional economic predictions are pointing towards a modest
growth in 2007, Zimbabweans unfortunately continue to be saddled with
further economic decline. It is believed that the Zimbabwean economy has
shrunk by close to 60% over the past 6 years and the country continues to
face persistent negative growth. Inflation is expected to reach frightening
levels of 5 000% in 2007.

The side effects of hyper-inflation have been too obvious: economic
distortions, misallocation of resources, erosion of incomes, discouragement
of savings, and uneven distribution of incomes. Inflation has a devastating
effect on the welfare of the ordinary people. It is no wonder that despite
the negative economic outlook, Zimbabweans continue to view the MPS as a
source of faded hope.  We believe that no matter how cleverly crafted, the
MPS can not resolve Zimbabwe's deep-rooted problems.

As indicated above, a monetary policy framework should be designed to
promote economic stability through delivering low and stable inflation. Low
inflation as reflected by price stability is fundamental to stable growth
levels and employment. And for this to be effective, it requires
appropriately designed instruments and policy initiatives which are
complimented by an appropriate fiscal policy framework.

Unfortunately, this desired situation does not obtain in our country. There
is very little macro-economic policy coordination between Monetary and
Fiscal authorities in Zimbabwe. This is obvious from the finger pointing
which has been exhibited on the issue of RBZ quasi-fiscal activities,
between the Minister of Finance and the Governor of the RBZ. It is within
this context that the MDC responds to the 2006 year-end monetary policy
statement presented by the Governor of the RBZ on the 31st of January 2007.

In the presentation there is a tacit but unexplored acknowledgement that the
Zimbabwean economic crisis is essentially political.

There is also an admission that this meltdown has been financially
beneficial to ZANU(PF) leaders and their supporters. More importantly the
Governor admits that the RBZ has failed to deliver on its mandate, in
particular that it has lost the battle with parallel market. In essence this
is a breaking point monetary policy statement, where the RBZ has essentially
abdicated responsibility on the core business of any Central Bank:
inflation, exchange rate and financial sector management. There is nothing
substantive in the statement on these key functions.

While no inflation targets are given, the Governor warns that if no action
is taken "inflation will rise significantly in the near term" and that
"Without bold steps, inflation will swallow our economy (sic) to levels not
seen before".  Thus the only panacea in achieving disinflation requires all
stakeholders "to act now" and take part in a "social contract" for monetary
policy stabilisation. The figures given by the Governor appear to be mere
completion of the formalities of a monetary policy statement, than any
serious coordinated results of policy predictions.

For example without giving inflation target, the Governor says that "Fiscal
and monetary policy restraint" will see broad money supply declining to
450-500% by December 2007 and to under 65% by December 2008. Other figures
like the M3 growing at 1 438% at the end of November from 670% at the end of
May, domestic credit rising to 1 278% to $526 billion are thrown about
without any solid analytical basis. It is difficult to understand how the
Governor expects interest rate policy to be "guided by inflation outlook"
while in the same breath high interest rates are to lead towards
stagflation. Without analysis accommodation rates are said to remain
unchanged at 500-600%.

This was not a monetary policy statement by any stretch of the imagination.


Unpacking the Distortions

While the eloquent description of price and exchange rate distortions
including their impact is noted, there is need to understand the response by
ordinary Zimbabweans to these distortions. Yes, the primary creators and
beneficiaries of these anomalies are the ZANU(PF) elites, but once they are
in place they drive national economic behaviour. Human beings have rational
expectations and hence behave rationally.

The distortions in our economy create opportunities for arbitrage. Taking
advantage of these opportunities is the rational thing to do. Selling
foreign money on the parallel market and selling subsidized fuel meant for
farming on the parallel market are the economically rational things to do.
Expecting Zimbabweans to behave differently given the circumstances does not
make sense. Hence, what is criminal is creating an economic environment that
is characterized by staggering distortions and then expecting human beings
to act irrationally.

Furthermore the fundamental drivers of the distortions must be understood if
sustainable solutions are to be achieved. The Governor argues that
stakeholders could care less about the cause of the Zimbabwe economic
crisis, they just want answers. This should be dismissed with the contempt
that it deserves. Yes, we should not dwell on the causes, but we have to
understand them, otherwise we end up addressing symptoms of the crisis and
executing unsustainable solutions.

The causes of our economic meltdown and hence the distortions include:
political illegitimacy, poor governance, corruption, global isolation, poor
economic management, and misguided economic controls. These issues must be
thoroughly appreciated and used to inform any redemptive framework.

In unpacking the role of distortions in our economy it is important that the
role of the RBZ in fueling these distortions be acknowledged: RBZ
involvement in quasi-fiscal activities, provision of subsidies, exchange
rate control, and buying foreign currency on the parallel market. There has
been incompetence, corruption, poor corporate governance and lack of
accountability at the RBZ. We have not seen externally audited financial
statements of the RBZ.

The Governor is the executive chairman of the RBZ board, which means there
are no checks and balance at the bank. For example operation Sunrise I; how
much did that operation cost, and what were the benefits to the country?
Given our current economic crisis how can the RBZ authorize the purchase of
a vehicle worth USD138 000.00 in an opaque transaction where a foreign
currency denominated loan is advanced to the Governor. Such corrupt and
criminal activities at the RBZ must be acknowledged if the Governor's
ranting about ZANU(PF) elites are to be credible. There should be no
selective application of analysis.

The IMF has established a code of conduct called the "Code of Good Practices
on Transparency in Monetary and Financial Policies - the Declaration of
Principles". The main thrust of the Code is to "establish desirable
transparency practices for central banks in their conduct of monetary
 policy". Our review of the conduct and practice of the RBZ shows that it
fails immensely against these standards.


Deconstructing the Social Contract

How do we remove the distortions?  What is required is a dramatic movement
towards market forces, by removing all controls. However, there has to be a
context and the right environment to make this effective. Of course there
will be redemptive pain and probably a political price to pay. We must lead,
and leadership is about making unpopular decisions popular.

The Governor outlined efforts that should be pursued in particular the
Social Contract. The effectiveness of a social contract as a tool for
resolving economic crises in history is well documented. The general
framework is an agreement to freeze wages, prices and expenditure in a
consensus driven framework involving all key players; government, labour,
business, opposition parties, and civic society. However, there are key
parameters that have to be in place. A social contract depends on solid
political will, total buy-in, inclusive ownership, acceptance of the
problems, honesty of participants, and moral suasion.

There must be a legitimate government in power, not a regime that is a
product of disputed elections. A regime that brutalizes leaders from labour,
civic society, business, and political parties, has no capacity to
facilitate the requisite discourse. You cannot even begin to discuss the
notion of a social contract where there is contested legitimacy of the key
stakeholder: the government.

There cannot be any total buy-in by all stakeholders to a process driven a
by an illegal regime. There is an additional dimension to the debilitating
Zimbabwean illegitimacy; the ZANU(PF) succession fight. The different
ZANU(PF) factions engrossed in a self-destructive orgy will not even agree
on the contents and processes of the social contract. That is how
dysfunctional our country has gotten.

In addition, ZANU(PF) as a party must come to terms with the fact that
neither rainfall patterns nor external forces will ever replace good
governance, good economic management of a country by its own people as the
principal resource. Does the Governor really believe that this deeply
entrenched interest group who have benefited from the status quo of the
massive distortions, will give up easily to a level playing field in a
social contract, all within the month of February?

It is also important for Zimbabweans to understand why the Tripartite
Negotiating Forum (TNF) processes have always failed. Furthermore, given the
nature of the economic crisis our social contract will not succeed without
external financial assistance. This help will not be forthcoming, as long as
we are a pariah state run by an illegitimate regime.

Consequently, on the social contract our message is very clear: There is
need for a legitimate government as a necessary precondition. This can be
achieved through a new constitution and internationally supervised
elections.


MPS Formulation: The Way Forward

The World over, the trend is now that the monetary policy is formulated by a
body called a Monetary Policy Committee (MPC), as in the case of South
Africa, Botswana and Britain. It has been found that having a body such as
an MPC ensures credibility and wide formalized consultation in the whole
process.

Sadly, in the case of Zimbabwe one man - namely the RBZ Governor, formulates
the MPS. The MPC must be institutionalized as opposed to patronage based
consultations as currently practiced. In fact in the past the Governor has
been known to brag about how even the ZANU(PF) cabinet was not aware of the
contents of the MPS. As the MDC we place high value to an MPS and our
Government will ensure that it is openly formulated by an independent entity
such as the MPC.

The trend in terms of fighting inflation is to use an inflation-targeting
framework. An inflation target framework will entail the setting of a
numerical target, which is intended to be achieved over the specific time
period. If appropriately done, the inflation targeting framework, will
provide a monetary anchor for expectations around which prices and wages are
set.

Inflation targeting requires the buy-in by all stakeholders so that they can
subscribe to it.  In addition, it helps make the Central Bank accountable.
The RBZ has failed dismally in the past in terms of setting a credible
inflation target. Some of the reasons as to why the RBZ has failed include:-

. Lack of coordination with the Fiscal Policy;
. Lack of independence on the part of the RBZ;
. Fiscal dominance which have undermined the effectiveness of any MPS
objectives;
. Poor leadership on the part of the RBZ Governor;
. Policy inconsistencies and reversals;
. Lack of credibility;
. Vicious cycle of money supply growth and RBZ induced credit expansion;
. Unachievable policy objectives;
. RBZ financial repressive initiatives such as high statutory reserve
requirements;
. Compulsory placement of public debt;
. Counter productive policy initiatives such as quasi-fiscal activities;
. Inability to deal with supply shocks;
. General indiscipline by both the RBZ and the Government
. Lack of intellectual depth in terms of forecasting and planning at the
RBZ.

As the MDC, we believe that an inflation targeting mechanism will only work
in a fundamental economic reform program which will focus on all the key
aspects of this economy, most of which are largely attributed to the ZANU-PF
misrule. Given Zimbabwe's current level of inflation, we cannot rely on
monetary targets alone to reduce inflation.

On the part of RBZ, what is also required is to develop technical and
institutional capacity to model and forecast domestic inflation. Appropriate
policy initiatives such as developing econometric forecasting models,
Philips-curve models, macroeconomic variable models and other indicator
models are required. In addition, a clear and unambiguous commitment to
attaining the target should be the primary objective.


Conclusion

Monetary policy matters in Zimbabwe will not be addressed in the absence of
a comprehensive stabilization program, underpinned by institutional and
political reforms. In particular the starting point is a new people driven
constitution, followed by internationally supervised elections. Only then
can meaningful efforts such as social contracts and monetary policy
formulation take place.

What the current RBZ statement means is that this is the end of thinking for
the regime of Robert Mugabe. They now agree that they can no longer pretend
to apply traditional monetary policy instruments. They then propose to adopt
a social contract approach, which we have amply demonstrated to be
impossible under the current illegitimate ZANU(PF) regime. This is the end
of the road.


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Media Commission Yet to Renew Weekly's Licence, One Month After Expiry





Media Institute of Southern Africa (Windhoek)

February 2, 2007
Posted to the web February 2, 2007


The government-controlled Media and Information Commission (MIC) has still
to license the "Financial Gazette" weekly, almost a month after the expiry
of its two-year operating licence under the controversial Access to
Information and Protection of Privacy Act (AIPPA).

The editor of the "Financial Gazette", Sunsley Chamunorwa, confirmed that
they have yet to have their licence renewed after lodging the requisite
re-registration documents. Chamunorwa told MISA-Zimbabwe that he would only
give details after their meeting with the statutory regulatory body, the
MIC, on 1 February 2007.


On reports that the MIC was refusing to renew their licence, demanding that
the newspaper first disclose its owners, Chamunorwa said he was not yet in a
position to provide further details.

MIC chairman Tafataona Mahoso, however, reportedly confirmed to "Zim-Online"
that his commission had not renewed the weekly's licence, but refused to
divulge further details. "It must be known that it is not an automatic
renewal, there are things that we look at . . . before granting a licence
and we are still looking at their application," Mahoso said.

He added: "We are not saying they will get a licence or not." Newspapers
renew their publishing licences every two years while journalists, who also
require licences to practice, must renew theirs after every 12 months.

The weekly's general manager, Jacob Chisese, confirmed the paper was still
to receive a new licence from the MIC. According to "ZimOnline", Chisese
refused to disclose details for confidentiality reasons, but he expressed
hope that his paper would soon have its licence renewed.

He said: "I can confirm we have not received our licence and we hope to get
it as soon as possible like the others. Issues to do with licences are
confidential so we cannot just go public over the matter because there are
still issues we are clearing (with the MIC)."


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MDC supporters released without charge

Zim Online

Saturday 03 February 2007





By Menzi Sibanda


BULAWAYO - Zimbabwean police on Friday released without charge four
opposition supporters who were arrested in Bulawayo on Thursday for
demanding the immediate resignation of President Robert Mugabe.

The four were part of a group of about 200 Movement for Democratic Change
(MDC) party who took to the streets in the city to demand sweeping political
reforms in Zimbabwe.

A senior MDC official in Bulawayo, Samuel Sipepa Nkomo, confirmed the
release of the four supporters.

"They were released without charge. We are now looking forward to mounting
more protests across the country to pressure Mugabe and his regime to
resign. We just cannot stand the suffering any more," said Nkomo.

There was a heavy presence of police in Bulawayo yesterday with police
spokesperson, Shepard Sibanda saying they were "ready to deal with any form
of unlawful behaviour" from the opposition party.

The demonstration was led by senior officials in the Morgan Tsvangirai-led
MDC who included the party's vice-president Thokozani Khupe, Getrude
Mthombeni and Nkomo.

Several opposition supporters have been arrested by the police over the past
seven years for allegedly flouting the country's tough security laws. Most
of them have however been released without charge.

The MDC accuses President Robert Mugabe's government of using the security
laws to stifle legitimate political dissent, a charge the government
denies. - ZimOnline



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Nurses' Strike - Three Arrested





The Herald (Harare)

February 2, 2007
Posted to the web February 2, 2007

Harare

THREE male nurses stationed at Harare Central Hospital were yesterday
arrested on allegations of inciting their colleagues at Parirenyatwa
Hospital to go on strike.

Police spokesperson Chief Superintendent Oliver Mandipaka said the three
left their workplace and proceeded to incite their colleagues who were
working to follow suit.


They were arrested by detectives from the Law and Order Section following a
tip off.

"We have arrested three nurses based at Harare Central Hospital for
allegedly inciting or instigating other nurses to go on an illegal
industrial action and stop them from attending to patients at Parirenyatwa
Hospital," said Chief Supt Mandipaka.

He said police were still investigating the matter with a view to preferring
charges against the trio under the Public Order and Security Act (POSA) or
under the Criminal Law (Codification and Reform) Act.

"We want to send a stern warning to others of the like-mind who want to
thrive on lawlessness to stop their action forthwith," said Chief Supt
Mandipaka.

There was pandemonium at Parirenyatwa Hospital yesterday when the three
entered the hospital and force-marched their colleagues who were working to
join their colleagues who are on strike.

It is understood that a group of striking nurses was during that time
marching outside the hospital.

At around 10am, the casualty section was deserted and the situation outside
the hospital chaotic as the three men went through the wards.

Disturbed by reports of the incitement, Health and Child Welfare Minister Dr
David Parirenyatwa visited the hospital to establish whether the situation
required Government intervention.

The Herald also visited the hospital and observed that the casualty section
was operating although some patients said they had been waiting for hours to
be attended.

"I understand that at Parirenyatwa 154 nurses are working while 100 are on
strike. The report I have also shows that nurses at both United Bulawayo
Hospitals and Mpilo are at work," Dr Parirenyatwa said.

He said 72 junior resident doctors were at work while 94 at the country's
four central hospitals were still on strike.

"Only 19 are working at Harare while the other 38 are on strike,
Parirenyatwa has 41 intern doctors on duty while out of the 25 junior
doctors at Mpilo, 19 are on strike."

United Bulawayo Hospitals has only six working junior doctors out of 21.

Junior doctors downed tools on December 21 last year demanding a $5 million
monthly salary among other benefits which include accommodation for those
who stay out of the hospital premises and realistic vehicle loans.

They got increases which left their salaries at slightly above $1 million.

The bulk of the nurses at Harare and Parirenyatwa Hospitals joined the
strike on Monday as they demanded payslips for the supplementary package
they had been promised.

On Monday the bulk of the nurses at Harare Central Hospital were relaxing
under some trees.

Dr Parirenyatwa said he could not comment on why the nurses had remained on
strike when they had got an increase this week.

"I cannot really say whether they are not happy because this has not been
communicated to me," he said.

Dr Parirenyatwa said he was however, concerned about the situation.

"I am worried that junior doctors who are on strike are now going around
some non-governmental organisations asking them to help them. I am no longer
sure whether they have a genuine case.

"We want them to work, we have spent a lot of money training them and until
now we are striving to improve their working conditions.

"We had expected that ethics should have compelled them to return to work by
now."

He said his ministry was closely working with various stakeholders who
included the Ministry of Finance and the corporate world to buy cars for
doctors.

"We see the need to review the $4 million car loan scheme and are also
involving the private sector for us to come up with a better deal in the
case of vehicles."

He said salaries of health workers would also been reviewed quarterly to
cushion them against inflation.


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Construction of Beitbridge Industrial Park Hits Snag





The Herald (Harare)

February 2, 2007
Posted to the web February 2, 2007

Harare

THE delay in setting up the administrative structures of the Zimbabwe
Investment Authority has stalled the construction of the Beitbridge
industrial park, which was being undertaken by the now defunct Export
Process Zones Authority of Zimbabwe.

EPZA was last year merged with the Zimbabwe Investment Centre following the
codification of the Zimbabwe Investment Authority Act.


Beitbridge industrial park was the biggest project that EPZA had been
running prior to its marriage with ZIC.

Sources said construction work has been halted, adding it could only resume
after the appointment of a board of directors for the new authority.

"There is nothing happening as of now. All the work has been stopped and it
may resume once new directors who would sit on the ZIA board are appointed,"
said a source.

In light of the runaway inflation -- which currently stands 1 281 percent
annually and is projected to rise further - it would have been prudent for
the construction work to proceed pending appointment of the directors.

The new board is also expected to redefine the status of the park in line
with the new legislation.

Industry and International Trade Minister Mr Obert Mpofu said in an
interview that names of those selected to sit on the board had been
submitted to President Mugabe for final approval.

"The process (of appointing directors) is being followed in a normal way and
an announcement will be made once we are done," he said.

The park is being developed on 42 hectares of land. It was mooted several
years ago and was initially scheduled for completion by 2004.

The delay has been largely attributed to inadequate financial resources. On
completion, the park would comprise eight buildings with several factory
shells. Since building started, only one buildings has been completed while
the second one is halfway through.

Industrial parks have the advantage of facilitating technology transfer,
consolidating cluster development and employment creation.

Sunway City, a subsidiary of State conglomerate Industrial Development
Corporation, is also constructing a multi-billion dollar industrial park in
Ruwa, about 20 kilometres east of Harare.


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Zimbabwe Civic Groups Say Consultation Lacked In Bulawayo Protest

VOA



      By Ndimyake Mwakalyelye
      Washington, DC
      02 February 2007




A protest march staged in Bulawayo this week by the faction of Zimbabwe's
opposition Movement for Democratic Change led by Morgan Tsvangirai caught
many by surprise - not only the police but also some of the MDC grouping's
civil society allies.

Tsvangirai faction spokesman Nelson Chamisa said the secrecy reflected steps
taken by the faction to spread word of protests without tipping off security
forces. Chamisa said Thursday's large demonstration was just "a grain" of
what is to come.

But the march of an estimated 3,000 MDC supporters was not entirely to the
liking of civic groups who said they wished the faction had not decided to
go it alone. However, others commented that the opposition has moved to
reclaim its political force after spending much of the past year sorting
itself out after an internal split.

For perspective, reporter Ndimyake Mwakalyelye of VOA's Studio 7 For
Zimbabwe turned to senior analyst Sydney Masamvu of the International Crisis
Group's Southern African office in Pretoria, South Africa, and
communications manager Fambai Ngirande of the National Association of
Non-Governmental Organizations.

Ngirande expressed the concern that MDC allies in the broad alliance
assembled in the Save Zimbabwe Campaign weren't included in planning the
protest.


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Zinwa Starts Normal Water Production





The Herald (Harare)

February 2, 2007
Posted to the web February 2, 2007

Harare

THE Zimbabwe National Water Authority has resumed normal water supply
following an improvement in the supply of key chemicals required in
purifying water.

Zinwa took over from Harare City Council and is now responsible for sewage
and water treatment management in the capital.


In a statement yesterday, the water authority assured Harare residents that
water problems would ease in the coming week following improvements in the
supply of aluminium sulphate.

Aluminium sulphate is a key chemical in water purification.

"Zinwa wishes to advise residents of Harare that it has resumed normal water
production and pumping to all parts of the city

"And also its environs following improvements in the supply of aluminium
sulphate that had forced the authority to cut down production," read the
statement.

Water supplies to the central business district, parts of the northern
suburbs such as Ashdown Park, Avondale and Mount Pleasant and the southern
suburbs are now back to normal.

Zinwa said areas furthest from the major treatment plants were still
experiencing water problems.

The affected areas include Mabvuku-Tafara, Zimre Park, Ruwa, Epworth,
Greendale, Kambanji, Glen Lorne, Chisipite, Mandara, the Grange and Colne
Valley.

"We wish to assure residents of these low-lying areas that water supplies
will resume in their areas this evening while residents of higher ground
areas will start receiving water tomorrow," the statement further said.

However, despite the improvement in chemical supplies Zinwa has introduced
water rationing in some low-density areas.

Under the water demand management system water would be released to some
low-density residential areas between 5am and 9am before supplies are cut
off for the rest of the day.

This, Zinwa said, was to allow water levels to build up again in reservoirs.

Water rationing is likely to continue until an improvement in the chemicals
supply situation, Zinwa added.

Zinwa also noted that power supply problems being experienced throughout the
country have negatively impacted on the authority's operations.

"This, however, result in low levels in our water storage reservoirs and
disruptions in our water supply schedules to residential areas," Zinwa said.

The water authority said water problems had come at a time when there was a
cholera outbreak and would continue working hard to complement efforts to
contain the spread of the fatal disease by ensuring that the city got
adequate water supplies.

The water authority appealed to residents to continue using water sparingly
as demand for water has outstripped supply capacity in Harare.

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