RESERVE Bank governor Gideon Gono’s plans for a new currency fell
victim to Zanu PF’s politicking, forcing him to introduce higher
denomination bearer cheques instead of new bank notes he had printed for
Sunrise 2, the Zimbabwe Independent heard this week.
Highly placed sources in the central bank said Gono’s proposal for a
new currency under the second phase of the currency reform was shot down by
cabinet a week before launch, forcing the governor to go back to the drawing
board to print higher denomination bearer cheques.
Gono in November showed business executives, bankers and journalists a
set of new currency notes including a $500 note (pictured above) which
presumably had lost some zeros along the way, but launched new bearer
cheques a month later.
The sources said cabinet in the first week of December summoned Gono
to update it on the currency changeover and to explain its advantages.
Cabinet questioned how the currency would sustain its value under the
prevailing inflationary situation, leaving Gono with no option but to go for
the higher denomination bearer cheques he had tried to resist earlier on.
They said cabinet argued that a new currency would still be eroded by
inflation and should only be launched after addressing economic
Former Finance minister Hebert Murerwa was the first to propose higher
denomination bearer cheques over a year ago, but his idea was shot down when
Gono knocked off three zeros.
"After the cabinet meeting, Gono went back to design the new $250 000,
$500 000 and $750 000 set of bearer cheques which explains why the roll-out
of the programme had to be delayed by two weeks even after logistical issues
were resolved," one source said.
The changeover, which was expected to take place well ahead of the
Christmas holiday to enable people to access money, only happened four days
before Christmas, forcing large numbers of people to cancel their journeys
after failing to access cash.
"The changeover, which was supposed to be launched in the second week
of December, only materialised on December 20 to enable the central bank to
prepare the new notes," the sources said.
They said a closer scrutiny of the new bearer cheques shows that Gono
had to transform some of the smaller denominations that could not be used
two years ago into higher denominations.
"The $750 000 note clearly shows that it was previously a $1 000 note
that was redesigned since it retained the $1 000 watermark," a source said.
Delays in the rollout of the programme happened at a time when Zanu PF
was organising the "million man" march and its extraordinary congress in
However, the new denominations have not solved the two-month cash
crisis with queues at banks getting longer each day.
Depositors are spending days in the queues hoping to get cash. The new
currency that Gono introduced is still in short supply. Even extending the
lifespan of the $200 000 bearer cheques has not resolved the cash crisis.
The situation is likely to worsen within a fortnight as parents
require large sums of money to prepare for the opening of schools.
Gono blamed cash barons as the biggest culprits in the cash crisis,
saying the RBZ had enough evidence to that effect.
He said as at November 15, cash in circulation stood at $58 trillion,
but banks were holding an average market-wide float of $1 trillion, leaving
$57 trillion "floating somewhere out there".
THE Morgan Tsvangirai-led faction of the MDC this week said the
Sadc-initiated talks with Zanu PF were on the brink of collapse as the
ruling party was backtracking on a transitional constitution and the date
for this year’s harmonised presidential, legislative and council elections.
Tsvangirai said President Robert Mugabe and Zanu PF wanted a "false
election" in March and if the MDC became part of it, it would be a danger to
The opposition leader said the MDC was ready to underwrite a smooth
transition to end the country’s multi-faceted crisis and remained in support
of the Sadc talks being facilitated by South African President Thabo Mbeki.
"But an unhelpful development has begun to creep in and we are
deadlocked on key issues that should enable us to cross the bridge into a
new era," Tsvangirai said on Wednesday in a statement on the economic and
political situation in the country.
"In spite of the mess we are forced to live with today, Zanu PF has
begun to backtrack on some of these agreed points and is going it alone."
He said the main sticking points were a transitional constitution and
an election date.
"We settled on the transitional constitution following assurances that
the agreement would be implemented before the next election. But Zanu PF is
now against the spirit and content of that agreement, insisting instead that
the transitional constitution can only be implemented after the election.
This is unacceptable," the MDC leader said.
Sources close to the talks said the MDC and Zanu PF agreed on a
constitution that is in the custody of Mbeki, but sharp differences have
emerged on when it should be promulgated.
The MDC, the sources said, wanted elections moved from March to June
this year to allow the agreement to take root, but Zanu PF insists the polls
should take place as scheduled.
"The pace at which the transitional constitution was to be implemented
determines the election date," Tsvangirai said. "If we are serious about
Zimbabwe’s future and an election whose process and result are endorsed by
all political players and the people of Zimbabwe, then we have to follow the
right protocols and procedures."
He said the transitional constitution already agreed to was essential
in helping Zimbabwe set up requisite infrastructure for a sound electoral
management system, codes for good governance and a human rights regimen
between now and the election date.
These, the former trade unionist said, were key factors necessary to
spur confidence, redirect the people towards a solution, regenerate hope and
to rally the nation to unite in handling sensitive national crisis.
"As things stand today, Mugabe and Zanu PF are merely stringing along
with us, when on the ground they are already moving ahead with their plan —
selectively picking up points of agreement and shoving them onto Zimbabwe in
a piecemeal manner to present a picture of reform, at home and in Sadc,"
He said the intention was to mislead Sadc into believing that a
lasting political solution was on the cards.
"They want to force an election in March with cosmetic reforms and
still rig the outcome through a flawed process. That will not happen,"
Some of the "piecemeal" agreements so far implemented include the
amendment to the Access to Information and Protection of Privacy Act, the
Public Order and Security Act and the Broadcasting Services Act.
During the Sadc talks, the MDC and Zanu PF also agreed on the need for
an independent electoral commission whose task was to register voters,
delimit constituencies, bar the military and the police from direct
involvement in elections and to run the entire election.
However, the opposition claimed that the ruling party has since
deployed the military, the Registrar-General’s Office and the Central
Intelligence Organisation to mark constituency boundaries and register
voters, contrary to the letter and spirit of the Pretoria negotiations.
"We reject this form of deceit, the insincerity whose consequences are
far-reaching for our bleeding nation. We refuse to engage in a ritual to
legitimise Mugabe through a flawed election," Tsvangirai said.
He said other options on the table, should the deadlock remain
entrenched, included a national shut-down and a series of lawful mass-action
activities to "pull the nation out of the deep hole".
FUGITIVE Zanu PF MP David Butau was not granted political sanctuary by
the UK to evade arrest in Zimbabwe on allegations of contravening exchange
control regulations, it became clear this week.
Information gathered this week by the Zimbabwe Independent revealed
that contrary to government claims that the Guruve North lawmaker had
secured asylum in Britain, Butau flew into London on a five-year visitor’s
visa issued to him in 2004.
Butau was also not on the European Union’s travel-ban list adopted
against President Robert Mugabe, his cabinet ministers and senior officials
barred from travelling to Europe.
Mugabe’s spokesperson and permanent secretary in the Information and
Publicity ministry, George Charamba, this week accused European countries,
notably Britain, Australia, the US and New Zealand, of providing safe havens
to high profile Zimbabweans wanted for alleged criminal offences in the
But British Embassy spokesman Keith Scott yesterday denied that the UK
was harbouring criminals.
Scott, in a written response to questions from the Independent,
described Charamba’s claims as nonsense, pointing out that Butau was in the
UK on a visitor’s visa.
"David Butau was issued a five-year visitor’s visa in 2004," Scott
said. "He is not on the EU visa ban list and is free to visit the UK for six
months at a time while his visa is still valid."
Butau’s visa will expire in 2009, but he will have to leave the UK in
the coming six months if he still remains there.
The lawmaker skipped the country after the police initially said they
wanted to interview him in connection with violation of foreign exchange
regulations. The police later placed him on the wanted list after he failed
to surrender himself.
Speaking from London to the Sunday Mail this week, Butau said he fled
the country to avoid rotting in remand prison awaiting trial or the
conclusion of his case.
Butau is the chairperson of the parliamentary portfolio committee on
Budget, Finance and Economic Development.
He claimed that he was set up by Reserve Bank governor Gideon Gono
whom his committee was investigating on allegations of graft.
THE two opposition MDC factions are scheduled to meet next week to
deliberate on their proposed re-unification in a bid to select a single
presidential candidate, aspiring legislators and councillors to fight
President Robert Mugabe and Zanu PF in this year’s harmonised polls.
Welshman Ncube, the secretary-general of the Authur Mutambara-led
formation, in a telephone interview yesterday said contrary to media
reports, the two camps were yet to agree on a presidential candidate.
Reports were that Morgan Tsvangirai was selected by both factions to
fight President Robert Mugabe in the presidential poll scheduled for March.
"We should be meeting after January 7 to discuss the issue of the
presidential candidate. As for aspiring legislators, our formation has
started the nomination process through district party structures in terms of
our constitution," Ncube said.
"Should we re-unite, there will be no automatic retention of sitting
members of parliament. Primaries will have to be held."
However, there were reports that sitting MPs from both formations were
agitating for automatic retention, arguing that they would not have finished
their terms of office since the current parliament’s term would be cut by
The lawmakers were also reportedly proposing that aspiring legislators
should instead contest in new constituencies to be delimitated by the
Zimbabwe Electoral Commission.
Coalition talks between the two camps collapsed last May over a host
The Tsvangirai camp’s executive recently met and underlined the
importance of the re-unification of the two factions arguing that fighting
Mugabe and Zanu PF divided would certainly hand the ruling party victory by
Sources in both factions said there were also fears that another
opposition party could emerge ahead of the elections, something that could
further undercut the MDC formations.
When the talks between the MDC factions collapsed, the sticking point
was the revision of the coalition agreement, which had become the basis of
the negotiations. The selection of parliamentary candidates for each faction
was also a divisive issue.
Initially the two had agreed that Tsvangirai would be the candidate in
the presidential poll and if they won Mutambara would become his deputy in a
coalition government, while they would equitably share government posts.
They had also agreed to not to field candidates against each other
where they have sitting MPs.
However, during a May 19 meeting of the two factions, the Tsvangirai
camp sought a revision of some of the initial agreements.
The camp wanted Thokozani Khupe, Tsvangirai’s deputy, to become second
vice-president with Mutambara.
The Mutambara faction rejected this saying the Tsvangirai camp was
trying to maintain its structure in the coalition while neutralising them in
the new arrangement.
Furthermore, the Tsvangirai group suggested a new formula of having
primary elections between the factions to select parliamentary candidates
which was also unacceptable to the Mutambara group.
THE National Incomes and Pricing Commission (NIPC) yesterday
provisionally granted private schools a fees hike of 600% for the first term
that opens on January 15.
NIPC chairperson Godwills Masimirembwa told a press conference in the
capital yesterday that the commission had noted with regret that some
schools and pre-schools had issued invoices with unapproved fees or levies
in terms of the law.
"NIPC has provisionally allowed schools to charge parents at the rate
600% for term 3 of 2007," Masimirembwa said. "For example, a school whose
approved fee was $40m for term 3 of 2007 would charge $280m for Term 1
Masimirembwa said the commission was prompted to intervene after some
schools started charging fees of between $1,8 billion and $5 billion for the
He said as a result of the NIPC’s intervention, the most expensive
school would be charging $910 million.
"All concerned should note that the law requires the commission to
approve fees and levies before they can be implemented. To this effect, all
the fees and levies invoiced to parents which were not approved are void in
law and should not be effected," he said.
Masimirembwa gave the schools up to Tuesday to submit their proposed
fee structures for speedy consideration by his commission.
The Association of Trust Schools (ATS) chairperson Jameson Timba last
night said the association would respond to the proposed hike after
consulting the affected schools.
However, he expressed concern on the delay by the NIPC to approve fee
structures saying it affected planning by the schools and parents.
Timba said the ATS had not received approval for 2007 third term fees,
which the NIPC used as a benchmark for the 600% hike.
"The NIPC should timeously approve fees. We are just over a week
before schools open, but to date the commission is yet to consider our
applications," Timba said. "What is in place is just a provisional fee
Meanwhile, there are fears that some schools may fail to open due to a
massive teacher exodus throughout the country and impending industrial
Secretary-general of the Progressive Teachers Union of Zimbabwe
(PTUZ), Raymond Majongwe, said at least 25 000 primary and secondary school
teachers had left the country by the end of last year.
"We will be able to ascertain the new figures once schools open but
thousands left for South Africa and other countries. The situation is bad.
We blame this on the government, which has perennially failed to address the
plight of our teachers," Majongwe said.
"Government’s lack of commitment towards addressing the teachers’
plight was demonstrated at the December Zanu PF extraordinary congress where
there was never any mention of plans to address problems in the education
He pointed out the PTUZ was now calling for a minimum wage of $250
million per month, $156 million transport allowance and $120 million housing
allowance after the previous demands made in November were not fulfilled.
Majongwe said if the new demands were not met, teachers would
"definitely resort to industrial action".
Constantine Chimakure/Loughty Dube
SENIOR Zanu PF politicians are reportedly pushing for the setting up
of a cabinet committee to probe the Reserve Bank amid growing reports that
it was actively involved in foreign currency and gold dealings on the black
This comes after a decision by the parliamentary portfolio committee
on Budget, Finance and Economic Development to summon central bank boss
Gideon Gono next week to appear before it and reveal names of senior
politicians and government officials he alleged were involved in money
Gono will also be asked to explain the central bank’s accounting
Impeccable sources in Zanu PF said a faction led by retired army
general Solomon Mujuru wanted Gono and the RBZ probed for their alleged
involvement in black market activities as part of "sanctions bursting".
The sources said the Mujuru camp was not happy that Gono was blaming
senior politicians and government officials for hoarding cash for
speculative purposes when the central bank was also culpable.
"The politicians will push cabinet to come up with a committee to find
out to what extent Gono and the central bank are involved on the parallel
market," one of the sources said. "They want to stop once and for all Gono’s
The Mujuru faction, the source said, was in the process of compiling a
dossier detailing how the central bank was active on the underground market.
"The dossier will reveal the RBZ’s runners and how they have been
conducting their business. It will bare all," another source said.
The sources said the RBZ was buying foreign currency through
individual runners, commodity broking companies and banks to finance the
agricultural mechanisation programme, service power debts and other
government-related projects in need of hard currency.
Last year, the Confederation of Zimbabwe Industries and the Zimbabwe
National Chamber of Commerce revealed that the RBZ had bought foreign
currency on the parallel market to settle Zesa and Air Zimbabwe foreign
The central bank also allegedly buys gold from illegal dealers to prop
up its reserves that have been in decline over the past nine years.
Gono this week said anyone with information that he and the central
bank were involved in illegal activities should report to the police.
"If the governor has skeletons in his cupboard which he cannot explain
to the relevant authorities, the law must take its course but let’s not
speculate," Gono told a media conference on Monday.
"Where I cannot explain to the authorities or police, let’s get on
with it and allow the law to take its course. I am no exception to this
exercise where all of us have to be accountable if called upon to do so."
Gono is also on record denying that the RBZ was active on the black
A member of the parliamentary finance committee, MDC lawmaker for
Nkayi, Abedinico Bhebhe, told the Zimbabwe Independent this week that they
agreed to summon Gono since he "has some explanations to do to the nation".
He said the committee would sit in the absence of its chairperson,
Guruve North MP David Butau, believed to have fled to the UK after police
said they wanted to interview him on allegations of breaching exchange
"When parliament resumes sitting next week, the committee will convene
a meeting and choose an acting chairperson before inviting Gono to appear
before it," Bhebhe said. "We also want Gono to explain security systems at
the central bank."
He said Gono as a public officer should name and shame "chefs" he
alleged were involved in money laundering and other corrupt activities.
"Gono will have to name in front of the committee all the senior
politicians and the cash barons on the RBZ list that he claims he has. The
RBZ has to be accountable to the people and Gono has no right to delay
releasing such vital information. The publication of the list will enable
the law enforcement agents to act on the information."
Bhebhe said the committee wanted Gono to account in detail on how
security systems at the bank operate and for him to explain how huge sums of
the new bearer cheques were found in the possession of a Harare woman barely
three days after their introduction.
"He has to explain the system of accounting for all printed money and
how the money is disbursed to financial institutions," Bhebhe said.
Police last week arrested a Harare woman, Dorothy Primrose Mutekede,
who was in possession of $10 billion in $500 000 bearer cheques, when the
daily maximum withdrawals for individuals are $50 million and $100 million
Mutekede named Harare businessman Jonathan Kadzura as the source of
the money. However, Kadzura denied the allegation.
Gono told an extraordinary congress of Zanu PF last month that
Zimbabwe’s cash crisis was a result of hoarding by cash barons. He said the
barons were senior politicians and government officials actively involved in
foreign currency dealings.
Less than a week after Gono’s pronouncement, police said they wanted
to interview Butau on allegations of contravening exchange control
Butau then reportedly fled to the UK, where he told the Zimbabwe state
media that Gono instigated his investigation after his committee started
probing Gono on graft allegations.
Police reportedly wanted to interview Butau in connection with the
payment of £573 000 to a United States company, Michigan Tractors, last
The money was allegedly from Butau’s personal account with HSBC Bank
in the Channel Islands.
Bhebhe refused to comment on whether the committee was investigating
Gono or not and said the public should await the outcome of its meeting with
the central bank boss next week.
THE MDC has accused Home Affairs minister Kembo Mohadi of using the
public media to peddle lies that the opposition has not submitted evidence
to substantiate claims of political violence against its members and civic
Luke Tamborinyoka, director of information and publicity in the Morgan
Tsvangirai faction, said the MDC submitted two dossiers to Mohadi
chronicling political violence.
"The party presented two dossiers to Mohadi — one compiled by us and
the other by the Human Rights NGO Forum — with incidents and cases of
political violence yet he continues to say that we have not presented the
required evidence. We don’t know what else he wants," Tamborenyoka said.
Tamborinyoka added that some of the cases were in the public domain
like the shooting to death of Gift Tandare and the assault on Kuwadzana
legislator Nelson Chamisa.
"The shooting of Gift Tandare and the assault on Chamisa are classic
examples of political violence which were presented to Mohadi and up to now
nothing has been done," Tamborinyoka said.
According to information to hand, the party’s Secretary for Home
Affairs, Sipepa Nkomo, has since last year been writing to Mohadi
complaining about his continued pretence that the opposition was yet to
substantiate its claims of political violence.
In a letter dated December 20, Nkomo wrote to Mohadi querying why he
continued to say the MDC was yet to provide evidence.
"When we met you and your officers we presented to you several
documents with specific cases, names, and incidents of violence," wrote
Nkomo. "We further furnished your office with documents and statistics on
violence compiled by other independent human rights organisations."
Nkomo accused Mohadi’s office of grandstanding in the state media.
"We are disappointed that there is a lot of grandstanding by your
office in the state media when you are aware that we narrated and presented
a report with relevant and specific facts on the matter," Nkomo’s letter
In another letter sent to Mohadi on November 2, the opposition party
raised concern over remarks made by President Robert Mugabe soon after the
MDC met Mohadi over alleged political violence.
"We also note that new cases continue to take place, even though the
statements made by President Robert Mugabe after our meeting seem to show
that Zanu PF is in a state of denial regarding the escalating violence," the
In a copy of the dossier which was presented to Mohadi’s office the
MDC said since its inception in September 1999 it has recorded 113
politically motivated murders.
"Since the MDC became a legitimate political opposition party it has
on record 113 members brutually tortured and murdered. These are the known
cases. Many cases of murder, or death resulting from torture, and assaults
go unreported for fear of reprisals," reads the dossier.
The opposition in the same dossier told Mohadi that the perpetrators
of the majority of the cases were known yet to date they had not been
brought to book.
"In the large majority of these cases, the perpetrators are known, and
yet to date have not been held accountable for their heinous crimes. The
best known example of this is the CIO operative Joseph Mwale involved in the
burning to death of the MDC’s (Tichaona) Chiminya and (Talent) Mabika in the
Buhera area in 2000," the dossier says.
The High Court ordered the prosecution of Mwale to no avail.
THE strike by magistrates, prosecutors and other court support staff
entered its fourth month this week with no solution in sight.
According to sources at the Bulawayo courts, a meeting that was
scheduled for this week between Ministry of Justice, Legal and Parliamentary
Affairs officials and representatives of the striking civil servants was
postponed to Monday.
"Our representatives were supposed to meet with the responsible
authorities on Wednesday in order to find a solution to the crisis at the
courts, but the meeting has been postponed to Monday," said one of the
The sources said the courts were being presided over by a single
magistrate since nine weeks ago.
Bulawayo’s main courts — Tredgold Court and Western Commonage — were
operating below capacity. The situation was the same at courts in Harare and
other provinces throughout the country.
Magistrates and Prosecutors across the country downed tools in October
in defiance of poor remuneration and poor working conditions.
The strike has resulted in disruptions in justice delivery as many
cases, which were supposed to have been heard last year, were still pending
before the courts.
A prosecutor who spoke to the Zimbabwe Independent on condition of
anonymity said the disparities in the salaries of judges, regional
magistrates and magistrates also contributed to the strike.
The sources in the judicial system said a judge is earning $400
million monthly, a regional magistrate is getting $200 million while a
magistrate was only getting $20 million.
The poverty datum line for an average family of five is over $100
million according to the Consumer Council of Zimbabwe.
Magistrates and prosecutors are demanding a 900% hike in their
salaries and have vowed not to return to work until government reviews their
The Justice ministry last year said it could not address the issues
raised by the magistrates and prosecutors as it had already exhausted its
budget and could only make adjustments this year.
As a result of the strike, hundreds of detainees in the country’s
remand prisons have been left stranded while detainees who, under the
constitution, should only be held for 48 hours are now spending much longer
Permanent secretary in the Justice ministry David Mangota declined to
comment on the ongoing strike.
AFRAS Gwaradzimba, appointed by the government in September 2004 to
assume management of assets deemed to be under the control of
Zimbabwean-born South African businessman, Mutumwa Mawere, has admitted the
state’s involvement in the acquisition of Shabanie-Mashaba Mines (Pvt) Ltd
Gwaradzimba told a court in London last month that the nationalisation
of Mawere’s business interests was done through AMG Global Nominees (AMG), a
The administrator was a witness on behalf of the government in a case
in which Mawere’s company, Africa Resources Ltd (ARL), is a claimant against
AMG’s acquisition of its assets.
Gwaradzimba said AMG was a nominee of the government and was funded by
the Reserve Bank of Zimbabwe through its quasi-fiscal activities to acquire
Asked by Mawere’s lawyer Francis Tregear before Justice Evans-Lombe of
the Company Court, Chancery Division, to confirm that he and AMG were
government nominees, Gwaradzimba initially said he was a nominee of the RBZ,
but later admitted that he was representing the government.
According to a transcript of the court proceedings, Gwaradzimba said:
"That is correct (I am a nominee of the government). But what I have said as
well is correct in that I got it (funds to run SMM Holdings) from the
Reserve Bank of Zimbabwe."
In a related development, Gwaradzimba denied under oath that SMM had
received funds remitted by Mawere’s other company based in South Africa,
Southern Asbestos Sales (SAS), which forms the basis of foreign currency
externalisation allegations against the businessman.
Under cross examination, Gwaradzimba first denied that US$700 000 had
been remitted by SAS, only to admit later when confronted with evidence
that, indeed, the funds were received.
However, in making the concession, he pointed out that as an
accountant he did not think that US$700 000 was a material amount.
This was despite Gwaradzimba’s report to cabinet on SMM affairs that
no remittances were made by SAS to SMM since July 2003.
Gwaradzimba was confronted with further evidence showing substantial
payments made by SAS to which he denied any receipt by SMM alleging that
Mawere diverted the funds.
The administrator further denied that a payment of US$1,763 million
had been made by SAS in April 2004.
However, documents produced in court revealed that SAS remitted
US$1,763 million to SMM on April 7 2004 through CFX Merchant Bank and the
bank confirmed receipt of the funds by the mining concern, contradicting
what Gwaradzimba said under oath.
"This undermines the case by the government of Zimbabwe that there was
externalisation of funds," Mawere said. "You have to ask yourself why an
administrator appointed by an honest government would deliberately lie under
oath. This can only be to assist the state in theft of private assets under
disguise. Also, why would a government that purports to be transparent use a
nominee company to conduct state affairs? Finally, Gwaradzimba is nothing
but a creature of a statute whose sole purpose is to pervert the course of
justice and enrich himself and his political masters."
ARL is challenging the "unlawful expropriation of its Zimbabwean
assets" by the government using what the company terms draconian measures.
Gwaradzimba was appointed to run the affairs of Mawere’s business
empire made up of seven listed companies on the Zimbabwe Stock Exchange and
more than a dozen other companies employing about 20 000 people and with an
annual turnover of US$400 million.
Mawere’s nationalised interests were owned through two
British-registered investment holding companies and the Zimbabwe government
is battling to take charge of the firms.
The decision by the government to place Mawere’s companies under the
control of Gwaradzimba was based on allegations that on March 31 2004, SAS
was indebted to SMM Holdings pursuant to an asbestos buying agreement
concluded between the two companies on November 15 2002.
SAS allegedly owed SMM Holdings US$18 464 595, a Canadian firm $628
071 and R4 515 367.
Mawere allegedly devised a scheme to divert the money owing by SAS to
SMM Holdings to Petter Trading Private Ltd (now in liquidation), a company
that was controlled by the business tycoon.
Liquidators of Petter, however, communicated to SMM that the
allegation about diversion of funds was baseless and unfounded, but the
Zimbabwe government applied for Mawere’s extradition from South Africa in
May 2004 on allegations that he had stolen the money.
The South African courts dismissed the application, but the government
of Zimbabwe specified him in terms of the then Prevention of Corruption Act
on the same allegation.
This was followed by the specification of SMM Holdings and related
companies deemed to be under Mawere’s control. The final step was then taken
to place the company under state administration instead of court
administration. The battle between AMG and ARL has been in the UK courts for
the past three years and judgement is expected on Tuesday.
THE 2007/8 agricultural season publicised as "the mother of all
agricultural seasons" is set to be a major failure if government does not
urgently provide fertiliser to save waterlogged crops due to torrential
rains in December.
A drive along the Harare-Masvingo highway revealed a sorry state of
crops submerged in pools of water caused by incessant rains across the
I travelled to Gutu district in Masvingo, my home area, over the
festive season. I used the opportunity to assess the situation on the farms
during the so-called mother of all agricultural seasons. Along the
300-kilometre highway I saw only one maize field meaningfully taken care of.
That was just after Beatrice. The rest were yellowing little patches in
The situation in Gutu was worse. Water has started seeping from
underground, making the fields inaccessible but still the government is
chanting that the season will be the mother of all agricultural seasons.
Farmers had planted an estimated 40% of the area normally put under
crops because of the shortages of seed and draught power and now the rains
have dampened prospects of a decent harvest even from those small plots.
I was curious to know the wishes of the farmers and how far the
government had gone in trying to mitigate the pending disaster.
All farmers said if government could provide fertilisers the situation
could reasonably improve. Agritex officers in the area said under such
circumstances farmers required lots of fertiliser rich in ammonium.
"Lots of ammonium nitrate or alternatively urea is required to help
the crops," one officer said. "But the fertiliser is not available. The
little found on the black market is beyond the reach of the majority of the
farmers. A 50kg bag is going for up to $25 million."
A Zanu PF central committee report presented at the party’s
extraordinary congress last month exposed vast differences between what the
farmers require to produce enough food and the resources made available by
The report noted that serious shortages were in the fertiliser sector
with local producers not in a position to fully exploit their capacity due
to unviable prices, shortages of phosphates, foreign currency, coal and
"The fertiliser industry are prepared to produce 53 950 tonnes of
compound D between October and December and 46 714 tonnes of Ammonium
Nitrate (AN) between September and February 2008 subject to immediate
availability of foreign currency amounting to US$12 million for spare parts
and raw materials, an improvement in electricity supplies and a reviewed
price," the report said.
The country requires 720 000 tonnes of compound D and 774 000 of AN
The report said government would bridge the gap through imports of
fertiliser from China and South Africa but still acknowledged that there
would be a huge deficit.
"From the output of the capacitated local industry, fertiliser will
further reduce the deficit of compound D and top dressing to 562 302 tonnes
and 633 486 tonnes respectively," the report said.
The government has issued permits to the Reserve Bank of Zimbabwe to
engage Intshona, of South Africa, for the immediate importation of 50 000
tonnes of urea and 41 000 tonnes of compound D.
Intshona is the company that brought substandard fertiliser into the
country last year resulting in the firing of the then Agriculture secretary
Last year, Intshona supplied about 800 tonnes of the substandard
fertiliser, prejudicing the country of up to US$300 000.
The report said the supply of fuel, coal and electricity remained
However, farmers’ organisations said the situation on the ground puts
into disarray all prospects of a quick fix to the declining agricultural
sector and the economy in general.
They say government efforts to boost production would not yield any
positive results under the current legislative set-up and continued farm
invasions, which have created uncertainty for investors to embark on
business expansions. They said the situation continues to be untenable
unless farm-grabbing and farming implement seizures by top government
officials at the expense of ordinary farmers, power blackouts and
unavailability of inputs are addressed.
The farmers also attributed the continued decline in productivity to
the uncertainty of tenure in the agricultural sector where farmers are
evicted on a daily basis. Continued acquisition notices, disruptions, acts
of violence on farms and lack of land-based collateral as some of the
problems discouraging investors.
The chaotic land reform programme, which from inception has been
condemned by international donors as unworkable and a recipe for disaster,
has turned out to be just that.
Over the past six seasons production in all facets of agriculture has
plummeted, dragging the economy down with it. Farmers have estimated
production to have fallen by 70%, resulting in the country surviving on food
handouts and grain imports to bridge food deficits.
THE Reserve Bank has finally intervened to ease the cash crisis across
all sectors of the economy. But governor Gideon Gono should not expect
plaudits for his messianic efforts after what should have been the
traditional festive season passed as a long nightmare for most Zimbabweans
who couldn’t access cash from banks.
The trouble with government’s retributive acts against a few errant
individuals is they always end up hurting the innocent. The withholding of
cash from banks to punish what Gono called "cash barons" had the same effect
as the decision to slash the prices of basic commodities by half in June: it
is ordinary Zimbabweans who bear the brunt of these ill-conceived acts.
Many businesses have not fully recovered from the losses induced by
the price cuts. As a result, the poor who were intended as the major
beneficiaries of the price reductions now spend even more time searching for
basic foodstuffs. Many spent the Christmas period in long queues outside
banking halls, hoping that by some miracle they might get some money. It was
all in vain.
But Gono had more shockers up his sleeve. Up to now he has not named
any of the cash barons who were hoarding the $200 000 bearer cheques.
Then after forcing hundreds of people in rural areas to risk drowning
travelling to the centres where they could convert their cash before his
December 31 deadline, he announced the $200 000 was still legal tender.
There can be no better demonstration of policy failure than this.
What should be made clear is that Gono cannot resolve the country’s
crisis through piecemeal acts of retribution. There are many innocent
Zimbabweans who would only be too happy to keep their money in the formal
banking system if only they could access it on demand. But that has become
more the exception than the rule of business in Zimbabwe.
Still, with inflation at close to 8 000% who would want to keep their
money in a bank account? The rampant scarcity of commodities, itself a
result of price control freaks in government, is also forcing every
Zimbabwean to move around with large quantities of cash, just in case they
chance upon something to buy.
At the end of the day it must be recorded that whatever temporary
relief Zimbabweans get from the extension of the life of the $200 000 notes,
Gono himself has permanently lost all credibility as head of the central
bank. He should be well-versed with the law of unintended consequences which
he uses to berate others.
The effect of his duplicity over the demonetisation of the $200 000
means that very few people will trust any of his future policy
pronouncements just as few still believe that he has any credible list of
cash barons. He has created widespread uncertainty about the RBZ’s
operations by telling the world that it has no policy framework — it
operates entirely on the whims of its governor.
It is one thing to adopt desperate measures to deal with a desperate
situation. It is another to hold the whole nation to ransom because a few
politically-connected individuals don’t want to play according to Gono’s
The biggest casualties of Gono’s desperate measures were ordinary folk
who were forced to dispose of their legitimate cash holdings, for instance
to purchase uniforms and pay school fees, buying trinkets they don’t need.
Yet there is no sign that we are getting to the end of this dark
tunnel of troubles. Reports last week that one of Gono’s own advisors had
been implicated in a $10 billion scam in the latest denominations don’t
inspire confidence in what the RBZ is trying to do.
Whether the gentleman concerned is guilty or not guilty is not the
real issue. The issue is that one individual had access to that kind of
money while the rest were starved and spent long hours standing in queues.
This issue alone points to a central bank that is keen to persecute
individuals and financial institutions for laxity in enforcing regulations
but is itself guilty of the same crime. It means those who have access or
have close links to the RBZ can get as much cash as they want for whatever
purpose, while the rest of the nation is restricted to miserly withdrawal
limits of $50 million a day.
Yet the big question still remains unanswered after all is said and
done. After Gono failed to name and shame, and instead extended the lifespan
of the $200 000 bearer cheque, what stops the same robber barons from
stashing away more money, even at the risk of being ambushed under Sunrise
What assurance is there for ordinary Zimbabweans that the worst of the
last quarter of 2007 is over? Isn’t it time to quit, Dr Gono?
By Joram Nyathi
USUALLY when I visit my rural home in Mberengwa, I leave Harare
behind — sewage, water and fuel shortages, power outages and political
acrimony. I don’t read newspapers nor listen to the radio — there is no
signal from ZBC. It was by pure chance that I heard of David Butau’s great
escape from Botswana Radio.
This time round I couldn’t leave Harare completely. When I left for
home on December 22 the hit song was Cash Crisis. It was topping the charts
in rural Mberengwa throughout the "festive" season and was still the
all-time bestseller when I returned a week later and still dominates the
charts far ahead of Power & Water Shortage.
The 75km of dust road from Mberengwa offices to my homestead is never
anything to look forward to under the best weather conditions. On this, our
wettest December in 127 years, it was like plunging headlong into a pool of
mud and rocks.
This is despite the fact that Zanu PF has crudely won all elections in
the two Mberengwa constituencies since Independence. Crudely because there
is never a transparent way of selecting councillors. In one particular
instance villagers were told to gather at Keyara business centre to receive
Then the "people from Harare" asked them from aboard their Hardbody
trucks if "anybody is against the councillor". There being no show of hand,
the incumbent was duly retained.
As far as parliamentary elections go, everybody knows the legend of
Biggie Chitoro who roamed freely across the district armed with every crude
instrument to deal instantly with dissenters in the country’s bloodiest
election campaign of 2000.
So our generous MP (I shudder to mention his blessed name) tarred just
1km of the road ahead of the 2005 parliamentary elections. One kilometre!
I had to drive through more rocky mud for some 80km from Keyara to
Mataga growth point, passing by the MP’s homestead. To his credit, he isn’t
doing himself any special favours, except that he can cruise over the mud in
Between Ngungumbane and Buchwa on my way to Zvishavane I met a team of
RBZ officials crawling through the mud and flooded craters on the road. They
had a large police escort to protect the new bearer cheques which were due
to be exchanged for the $200 000.
(At least somebody close to the money press now knows how diligently
our Zanu PF MPs are working day and night using heavily subsidised vehicles
and fuel to make our lives as comfortable as possible. After all isn’t that
what democracy is about?)
So it was that Harare followed me into rural Mberengwa where a number
of people said they knew nothing about the currency change. At Mataga growth
point some businesses rejected the new notes we were carrying because they
could be fake. Remember most parts have no ZBC signal and there are no
newspapers. Worse still, schools being closed means pupils who normally get
such information from their teachers didn’t have any.
The few who knew alleged RBZ officials last time, during Sunrise I,
made a brief stop-over at the local shopping centre before driving away,
leaving many villagers with stacks of "manure". This time there was no
money. Those who failed to exchange their $200 000 bearer cheques are
smiling all the way to the beerhall while the "clever ones" scramble to
re-access their money at banks.
At least that is how far the confusion over the new notes has spread
across the country and set tongues wagging about whether Gideon Gono knows
what he is doing. Which leaves him in something of a dilemma: to print or
not to print more money?
Of course the official version of things is that there is already too
much money in circulation. So where is it?
Gono says someone called Cash Baron has the money. This evil fellow
changes form according to his plans. He can be a senior government or party
official or he can be a businessman. But ordinary Zimbabweans have stopped
worrying about this evil fellow’s identity. They would rather have their
money. Is Gono in control?
Then there are those who see political capital in Gono’s dilemma. His
problem, they proclaim loudly, is that he wants to be Mr Know It All. They
don’t believe anybody else other than the criminals in government is
hoarding cash. What they are hoarding themselves is legitimate because they
are trying to beat inflation. Which sort of makes sense.
But then as soon as Gono prints more money they complain about the
press overheating. "So long as he continues to print money, he can forget
about taming inflation," they warn sagely. Which sort of makes sense too.
So what is to be done? Everybody who is not in charge seems to know
the solution, yet as a nation we don’t appear to have any. It makes me want
to go back to my rural home.
By Vincent Kahiya
THE year 2008 carries with it a lot of hope for suffering Zimbabweans.
The list of trials and tribulations endured in the past year by ordinary
citizen is long and unbearable.
In the past year Zimbabweans across the social and political divide
have had to contend with shortages of literally every basic commodity or
service. Countrymen have scrounged for everything from drinking water to
As the festive season approached the country ran out of cash as the
effects of hyperinflation and speculative activities caught the central bank
governor and his team flat-footed. In his New Year message, MDC president
Morgan Tsvangirai summarised the year 2007 as the worst year ever imagined
It is true that in the previous year compatriots have demonstrated a
great deal of courage, endurance and resilience in the face of these
state-sponsored hardships. But it’s also true that President Robert Mugabe’s
continued brinksmanship has stretched our patience to the limit. Lives
continue to be lost amid a paralysis in the health delivery system -- a
direct result of the dictatorship.
We reiterate that the salvation of all Zimbabweans rests in a free
election in 2008 under a new constitution.
But I see a tragic situation developing ahead of March. President
Mugabe and the Zanu PF regime insist on an election within the next 90 days
even before the Sadc-initiated inter-party talks have been concluded in
The MDC has already indicated that an unhelpful development has
started to creep in resulting in a deadlock on key issues. Zanu PF has begun
backtracking on some of the agreed points and is determined to go it alone.
According to the opposition party the main sticking points are a
transitional constitution and the election date.
While the MDC is insisting on a having a new constitution before the
harmonised elections Zanu PF wants the constitution to be commissioned after
the elections. The MDC has also called for the postponement of the election
to June in order to give ample time to the transitional phase from the
status quo through the implementation of precepts agreed to during the
talks. On the contrary, President Mugabe has declared that elections will be
in March come rain or sunshine.
The MDC must tread with caution and diligently weigh the options
available to it as we approach this delicate phase of our politics.
There are three likely scenerios as we draw closer to the political
face off whose ramifications are far reaching for the political parties and
the citizens alike. The first scenario may see President Mugabe and his
ruling party taking their brinksmanship to another level by insisting on
having the elections in March and having a new constitution after the
The second scenario may see Zanu PF agreeing to the postponement of
elections but refusing to budge on a transitional constitution. This is
possible but unlikely because of a number of critical reasons.
The third scenario, which is also very unlikely, may see Mugabe
agreeing to demands by the MDC for a transitional constitution and elections
postponed to June.
It is the first scenario that is most likely to carry the day if one
reads the President Mugabe’s public statements and Zanu PF’s body language
as we lumber closer to the crunch election.
Because of President Mugabe’s arrogance and his overrated popularity
the Zanu PF government is likely resolve to go it alone in the event that
the current deadlock persists.
It must be crystal clear to all in the MDC that the 2008 general
plebiscite is no child’s play.
These elections carry the potential consequence of regime change and
consigning the founding fathers of independent Zimbabwe to the dustbin of
The prospect of becoming the new government this year for the MDC
poses the practical risk of losing power for the increasingly paranoid
Mugabe and his ruling party.
For President Mugabe and his regime losing this year’s elections has
grave implications given their notorious history and human rights record
The MDC must appreciate that the political stakes in this plebiscite
are extremely high and those who intend to be part of this contest must be
equal to the task. Jonathan Moyo captured the attitude of the ruling party
when he said "any ruling party that agrees to opposition demands for a new
constitution before a general election exposes itself to assured electoral
defeat". Zanu PF is alive to the fact that the reason why it has remained in
power until today is because of the flawed Lancaster House constitution
which gives President Mugabe the executive powers to rig elections.
Mugabe is not keen on doing away with a constitution that gives him
the unfair but crucial advantage of being both player and referee in all
electoral contests and legislating himself out of power.
The Zanu PF government is also aware that postponing elections to June
will give the fractured MDC enough time to unify and adequately prepare for
the watershed polls. It is clear that President Mugabe is more comfortable
going into the elections with a divided MDC because this translates into a
divided vote which is a natural advantage to Zanu PF.
We read that the MDC maintains that an election is impossible in the
next 100 days if its demands are not met. Zanu PF must not be allowed to
steal another election and prolong the suffering of the masses by getting
away with a rigged election.
We hope that the opposition is committed to this position and will not
dither at the last minute. We also believe that in making this position
public the MDC leadership has consulted widely both within its ranks and
outside. Indeed, the MDC must refuse to engage in a ritual to legitimise
Mugabe through a flawed election.
Gono, we are not so stupid
WE need to wake up and use our smart brains. If the demonitisation of
the $200 000 bill was affected by the weather then why not extend the
changeover period? This is the time for all of us to see that the government
made the mistake of hiring a clown as head of the central bank. Can you
imagine what will happen in the rural areas next time we are going to try to
change the currency?
The Reserve Bank governor is not aware of the troubles that he
inflicted upon the rural people. In some areas his lies about changing money
in 10 days created its own "cash barons" as he likes calling them who were
exchanging new notes with the $200 000 for a premium. In some rural areas I
am told the premium was as high as $1 million of the $200 000 for every $500
000 of new notes. So please tell me why were some people in the remote and
inaccessible areas forced to lose 50% of their money only to be told "tanga
tichitamba (we were just joking)".
I remember the days when we were young and living in the rural areas.
Whatever the radio announced was considered credible and no one would
dispute it. Now with these kinds of games do you think next time the RBZ
announces change of currency messages over the radio the rural people will
believe him and risk being stupid in ten days time?
I also blame the powers that be at both the Herald and the ZBH for
giving Gono space to fool the whole nation.
I fully support government efforts to root out cash barons but for the
governor to make the nation queue for three months is heartless.
Gono took the nation for a ride yet he knows who the cash barons are.
He knows $100 trillion is not enough for Zimbabwe’s cash needs but he still
wants to experiment by forcing the nation to work with an inadequate cash
base. Was it necessary to make the public experience cash shortages for two
months before he could identify multiple bank account holders? In any case
is it illegal to have multiple bank accounts in Zimbabwe?
Even if Gono argues that he was conducting an experiment or survey,
research ethics require that the subject participants be informed and be
It is surprising that the government gazzette now belongs to one
person who churns out decrees willy nilly every 10 days without due care
about the consequences for the nation at large.
I would like to leave you with these questions (especially those 30
years and above). You remember the years when you were doing your secondary
education? — the only sensible place to keep cash was the bank such that
even the students would at the end of every six months submit their POSB
savings account passbooks for interest calculation. Try to do that today and
see the kind of rewards you get. Is there any need to explain why there is
no money at the bank? Is it sensible to keep money at the bank and yet when
you are hospitalised you cannot access it?
Gono, please give the nation their cash and their liberties and
Elections are predetermined
LET me remind Zimbabweans that election results are decided in a Zanu
PF office with the participation of the JOC and CIO. They decide how many
seats they need, then which constituencies they should claim to have won the
Then to make the elections look credible, they make the MDC "win" the
rest of the constituencies. Thus they start announcing MDC "wins" first.
They reserve the pain for the last moments when their calculated results
start rolling in. When they decide they need a two-thirds majority, they sit
down and decide which constituencies they will claim to have won. They
carefully choose rural constituencies where no one will dare challenge.
If this does not work they resort to precalculated figures. This is
where Tobaiwa Mudede and lately George Chiweshe come in. This was done
successfully in 2000 and emboldened Zanu PF to allocate themselves a
two-thirds majority in 2005. That is why Mugabe always declares before hand
that he will have a resounding victory.
This is their game plan again for 2008. They will take the MDC and
Zimbabwe for another ride and this time with the Mbeki-led talks
legitimising the theft of Zimbabweans votes.
The MDC do not learn lessons quickly. Zimbabweans will blame the MDC
for prolonging their suffering if they participate in such a pre-determined
election. The 143 seats allocated to rural areas were a direct result of
this calculation. Votes will not be realistically counted in these
constituencies. The results and figures are already with the CIO and ZEC,
waiting to be announced after the fictitious "counting" of votes. I know
this for a fact.
I was a military intelligence officer in the ZNA before I got fed up
with seeing the mad destruction of my country and the blatant theft of
votes. If Zimbabweans continue to ignore this fact and allow Zanu PF to run
the elections through the CIO and army then no opposition party will ever
win in Zimbabwe.
People have voted for the MDC overwhelmingly in all past elections but
the figures decided in a Zanu PF meeting are the ones that are announced to
Be warned Zimbabwe. Until a fool-proof system is designed by all
stakeholders, here comes another predetermined resoounding win for Zanu PF
in 2008 and here comes the growing frustration with the MDC by people.
This is exactly what Zanu PF wants: to make people lose faith in
opposition parties so that eventually it will win due to apathy hence
eventually it won’t have to rig elections.
Zanu PF a master of amendments
ZANU PF has proved to be the master of amendments. They have amended
the Constitution for the 18th time. It has just amended Aippa, Posa and BSA.
Zanu PF has also amended the definition of democracy and has come up
with its own version, that as long as everything is going well for Zanu PF,
I am also convinced that as a master of amnedments there is little
doubt that Zanu PF will amend the election results for next year’s
presidential election in their favour.
When will they stop these amendments and instead do an overhaul of the
I am totally against these amendments. The only document I will
support to be amended is my payslip so that I will be able to put bread and
butter on the table for my family. Not these politicking amendments that
have no effect at all on my livelihood.
Failure is a viable option for brave men
RBZ governor, Gideon Gono’s circus continues to provide cheap
entertainment, the latest being a feeble attempt to mitigate cash shortages.
It is laughable, though unfortunate, that the egocentric governor
reckons naming the so-called "cash barons" is the ultimate panacea to
resolve the current cash crunch. Has it not occurred to him that people have
lost faith in the banking system?
RBZ policies have given rise to the "cash barons" who are in fact Zanu
PF functionaries, by giving them preferential access to both local and
The governor must not whine about a system he has perpetuated since
his appointment to the RBZ. As usual, the threat to name those "cash barons"
will not come to pass because the dear governor is also a receipient or,
better still, a victim of the Zanu PF patronage cycle. Gono’s tenure at RBZ
has been an absolute disaster in the core functions of such an esteemed and
respectable institution. Failure is a viable option, but it takes brave men
to admit that.
Other countries were also colonised
I THINK President Robert Mugabe should stop preaching about historical
inbalance over and over without facing the real problems that have beset the
So many countries were colonised by Britain. Just look at their
economies and their relations with Britain.
Everyone fought for the struggle. It wasn’t a lone battle so there is
no reason why Mugabe should continue preaching about the struggle as if
Zimbabwe is his personal property or as if Zimbabwe is the only country that
gained Indpendence through an armed struggle.
When shall we be saved from such language?
I REFER to the article by Nathaniel Manheru in the December 22 Herald
and generally to previous installments by the same columnist also rumoured
to be the permanent secretary in the Ministry of Information and Publicity,
Surely if the Herald is a family paper, why should we be constantly
subjected to obscene language? The heading itself "Make love . . ." was a
great embarrassment. My 10-year-old wanted to know what the column meant and
what was the subject.
The author even went on to give details of the obscenity.
Unfortunately I had no answer for the young man who looked puzzled by the
subject in a family newspaper. A whole permanent secretary being such a
Several installments in the past have included similarly coarse
language and the author seems to be getting carried away. Please can someone
in authority help stop this nonsense. We are aware the editor is intimidated
by the author and may not be in a position to act but surely someone or a
group of people should be able to expose this. We need to enjoy reading the
paper as a family.
Looking forward to a clean informative newspaper on Saturdays in 2008.
Unit C, Chitungwiza.
Central bank governor not to blame
THE government is making the work of the RBZ Governor very difficult
through its ill advised economic policies. We don’t have any economy to talk
about therefore all the monetary and fiscal policies will fail.
Seeing this, Gideon Gono resorted to "bush" economics which
unfortunately have let him down once again.
Let it be known to the nation that unless and only unless the
government admits that it has got a problem and not the West as it wants us
to believe then the crisis in Zimbabwe is far from being over.
What Zimbabwe needs is a new beginning and that new beginning is
nowhere in sight with this current regime.
So please don’t blame Gono for failing but blame him for dancing
according to the government’s tune.