By ANGUS SHAW, Associated Press Writer
HARARE, Zimbabwe - Cars no longer line up at gas stations because there's no
fuel for sale. Gone are the meat, bread and cornmeal that Zimbabweans count
on for their meals. Two weeks after the government ordered price cuts in
response to the country's rampant inflation, the economy is coming to a
More than 30 company executives have been arrested for hoarding goods and
flouting the price cuts, and several have been fined up to $6,600, court
officials said Monday. Among those rounded up were executives of a leading
clothing retailer, two directors of Zimbabwe's main food distributor and
fast-food chain, and the chief executive of the largest producer of pork
The sudden drop in prices had led to panic buying, stampedes and near-riots,
leaving shelves bare of staple foods. Witnesses said many shops and
suppliers were cleaned out by convoys of ruling party supporters who came in
after police and inspectors enforcing the price cuts.
Factories, stores and gas stations have been unable to replace goods sold at
Gas stations have run dry, putting an end to the long lines of cars. On
Monday, the government ordered private commuter buses to cut fares by
three-fourths, promising bus owners they would be able to buy subsidized
fuel from the state oil procurement agency.
But many ignored the directive and simply abandoned their routes. Businesses
reported higher numbers of workers failing to arrive at their jobs.
"We are incurring huge losses. We can't go on like this for much longer,"
said one industrialist. "We'll have to lay off quite a number of our people
very soon," he said. "We've shot ourselves in the foot this time."
He asked not to be identified for fear of retaliation. President Robert
Mugabe warned Friday that the government would target uncooperative managers
and seize factories that scaled down their operations. His government
accuses business leaders of being part of a campaign to bring him down.
More than 1,300 businesses have been charged and fined over the past two
weeks, police said.
Economist John Robertson warned shortages would worsen.
"The crunch can't be far off," he said. "Retailers who can't recover the
money they spent on their goods are not going to carry them anymore, and
manufacturers who are not allowed to charge more than their production costs
are going to stop making them."
By the end of next week, as gas stations go out of business, "we won't have
much mobility anywhere and we will have run out of options," he added.
Last week, the government announced it was reviving the long-defunct State
Trading Corp. to run businesses that had collapsed or were seized. The
corporation itself collapsed in the 1980s through mismanagement.
Police spokesman Oliver Mandipaka said the crackdown was "not a gimmick and
will be sustained at all costs to stop consumers being ripped off," state
He appealed to rural villagers and farmers "to complement government efforts
by reducing prices of cattle so butcheries can operate viably," radio said.
Beef, a favorite in the diet of Zimbabweans, disappeared from shops more
than a week ago.
Cattle herds already have shrunk drastically since the seizures of thousands
of white-owned farms disrupted Zimbabwe's agriculture-based economy in 2000.
Cattle are a status symbol in rural communities and often are used as a
dowry. It was unlikely villagers who have resettled on former white-owned
land would heed Mandipaka's appeal.
Live goats were being sold in Harare, but goat meat has not appeared in
slaughterhouses or supermarkets. Women snapped up cabbages at one open air
"It's something to put on the table anyway," said one woman who only gave
her name as Olivia. She said two large cabbages could be made to last about
Official inflation is running at 4,500 percent - the highest in the world -
though independent financial institutions estimate real inflation is closer
to 9,000 percent.
The government has admitted to printing extra money - seen as a main cause
of inflation and an obstacle to South Africa's reported offer to shore up
Zimbabwe's collapsing dollar by pegging it to the South African currency.
As the crisis worsens, Zimbabweans may resort to looting, Robertson said.
"I think the government will finally unleash the impatience and the anger of
our normally agreeable and passive population," he said.
Tuesday 10 July 2007
By Patricia Mpofu and Nqobizitha Khumalo
HARARE - President Robert Mugabe's government has dismissed as
"wishful-thinking" reports that the Southern African Development Community
(SADC) was planning to rescue Zimbabwe's increasingly worthless currency by
linking it to South Africa's rand.
Information Minister and chief government spokesman Sikhanyiso Ndlovu
dismissed the reported plan offhand, saying Zimbabwe, as a sovereign state
could not surrender control of its currency to a foreign state.
"I have read those reports, but I can tell you that is wishful thinking,"
Ndlovu told ZimOnline. "How can that be when we are a sovereign state?"
added Ndlovu, who spoke as SADC secretary general Tomaz Salomao left
Zimbabwe on Sunday after holding talks with Harare officials on how to
rescue the collapsing economy.
The 14-nation SADC last March appointed South African President Thabo Mbeki
to mediate in Zimbabwe's political crisis and tasked Salamao to draw up a
plan to end Zimbabwe's unprecedented economic meltdown that has negatively
affected the entire region.
Mbeki is this week hosting secret talks between Mugabe's ruling ZANU PF
party and the main opposition Movement for Democratic Change party in
Pretoria aimed at finding a negotiated settlement to the political impasse
between Zimbabwe's two biggest political movements.
In a dramatic expose, a Sunday newspaper reported that SADC was putting
together a plan to rescue Zimbabwe's crumbling economy by pegging the
Zimbabwe dollar to the South African rand.
The paper said SADC wanted to stabilise the exchange rate of the Zimbabwe
dollar and curb rampant inflation, now estimated at more than 5 000 percent.
Under the SADC plan, Zimbabwe would be included in the multilateral monetary
area of, South Africa, Namibia, Lesotho and Swaziland were the rand is legal
The South African government, that in 2005 had a US$500 million loan offer
to Harare spurned, had by late Monday not yet directly commented on the
reported plan to link the rand to Zimbabwe's unstable dollar.
Inflation is the most visible sign of Zimbabwe's deep recession that has
left more than 80 percent of workers without jobs and left those still lucky
to hold a formal job unable to feed their families because of ever-rising
Independent economic analysts on Monday hailed the reported plan to link the
dollar to the rand saying it could easily help uplift Zimbabwe's economy
especially if accompanied by a holistic package of economic and political
However, they were quick to add that they did not see Mugabe accepting a
plan that would in essence see Harare surrendering monetary control to the
Southern African Reserve Bank.
"If Zimbabwe is allowed to use the rand it will instantly solve the country's
inflation overnight and prices will be stabilised instantly," said
Harare-based economic consultant John Robertson, adding that runaway
inflation in Zimbabwe was more a result of government overspending rather
higher prices and wages.
But he cautioned: "Is the Zimbabwe government prepared to reverse the
destructive political processes it has embarked on such as the land reform
so as to get that privilege to use the rand?"
Eric Bloch, an economist in Zimbabwe's second largest city of Bulawayo, said
he was not optimistic that the Harare administration would agree to the
obviously stringent conditions that would accompany any plan allowing
Zimbabwe to link its currency to the rand.
Meanwhile, South Africa's official opposition Democratic Alliance has called
for political reforms in Zimbabwe before any help is offered, saying Mugabe
has in the past broken promises to undertake reforms and could not be
trusted to keep his word.
The DA, which also called on the South African government to be transparent
on any help given to Harare, said Mugabe should end repression against the
opposition and the media and undertake to hold free and fair elections next
year before he could be helped.
"Any financial assistance package as well as plans to extend the rand
monetary area into Zimbabwe must not be used to prop up the increasingly
tyrannical rule of Robert Mugabe. It can and should only be used to restore
democracy and the rule of law in our northern neighbour," the DA said.
The South African opposition party also said that the SADC and the broader
international community should help to shoulder the burden of any financial
commitment made to Zimbabwe. - ZimOnline
Tuesday 10 July 2007
By Tsungai Murandu
HARARE - Zimbabweans are a wily lot, always quick with new tricks to stay
ahead of President Robert Mugabe's control-obsessed government and ways to
survive the harsh realities of a comatose economy.
Take for example the latest trick by Harare's landlords to hike rentals and
beat runaway inflation right under the noses of Mugabe's police and militia
deployed to enforce a blanket ban on increases on prices of goods, rentals
and service charges.
A growing number of landlords no longer collect cash from tenants - unless
of course it is in foreign currency - otherwise many simply demand groceries
such as washing soap, cooking oil and sugar as payment for accommodation.
With inflation at more than 4 500 percent, the average rent per room in
Harare's working class suburbs is $200 000, which is equivalent to US$800 at
the official exchange rate of 250 Zimbabwe dollars to one United States
This, however, translates to just under US$2 when converted at the
unofficial but more realistic parallel market rate of 120 000 Zimbabwe
dollars for every US unit.
"We have been told we can't raise our rentals, which leaves us with no
choice but to demand that our tenants pay us in kind," said Esnath Mlambo, a
widow in Harare's sprawling low-income suburb of Dzivarasekwa.
Mlambo, who lets out three rooms of her six-roomed house, charges five bars
of soap, two litres of cooking oil and two kilogrammes of sugar per month
A bar of washing soap goes for about $120 000 at the new government-enforced
prices while two litres of cooking oil costs around $250 000 and a two-kg
packet of sugar sells at $40 000.
For several Zimbabweans such as Mlambo, rentals from properties are the only
source of income in an economy where a loaf of bread costs anything up to
$60 000 and a two-kilogramme packet of sugar sells for up to $90 000 on a
thriving basic commodities black market.
The illegal parallel market has increasingly become the source of most goods
since commodities started disappearing from shop shelves following the price
With unemployment pegged at more than 80 percent - and hardest hit by the
effects of HIV and AIDS - it is a daily struggle for most families to meet
A burgeoning HIV/AIDS pandemic claiming the lives of at least 3 000
Zimbabweans every week and many of these breadwinners has only helped
exacerbate poverty with an increasing number of families in urban areas now
depending on the little income they get from tenants for their daily upkeep.
Analysts yesterday described the charging of rent in kind or foreign
currency, mostly US dollars or South African rands, as an "implicit
dollarisation" of the economy and as a "coping strategy" being employed by
long-suffering Zimbabweans to escape economic challenges facing the country.
University of Zimbabwe political scientist Eldred Masunungure said by asking
for rentals in kind, the Zimbabwean landlords were compensating for the
rapid loss in the purchasing power of the local dollar in recent months.
"This is a demonstration of the lack of faith in the national currency,
particularly the stability of the dollar," said Masunungure.
The Zimbabwe dollar has crashed by more than 50 percent against major
international currencies since the beginning of last month, prompting prices
of most goods and services to rise five-fold in a space of two weeks.
The government reacted by issuing a directive two weeks ago forcing
producers and retailers to reduce their prices by more than 50 percent.
It also outlawed rental increases to cushion tenants after the cost of
accommodation started going up.
But, as Mlambo noted, the landlords and manufacturers would always find
other means of beating the government directives.
She said: "There are only two choices. It is either we start charging
realistic rentals or we starve to death while trying to be good citizens." -
Tuesday 10 July 2007
By Hendricks Chizhanje
HARARE - The National Association of Non-Governmental Organizations
(NANGO) has rejected charges that it is hoarding basic commodities saying
the charge was a ploy by Harare to restrict their operations ahead of next
Industry and International Trade Minister Obert Mpofu at the weekend
said the government was investigating several NGOs that were hoarding
foodstuffs for distribution at election time next year as part of plans to
effect regime change in Zimbabwe.
NANGO spokesperson Fambai Ngirande said the allegations were patently
false and were meant to restrict operations of humanitarian agencies
involved in food distribution in Zimbabwe.
"It is their (government) usual plan. They start with political
statements to pave way for such operations. They are increasing repression
of civic society.
"It (repression) has become such an integral part of the government's
pre-election strategy," said Ngirande.
The Zimbabwe government has in the past threatened to shut down NGOs
involved in human rights work and governance matters accusing the groups of
pushing a regime change agenda.
Mpofu's comments to crack down on NGOs followed a raid by the police
at National Foods in Harare where the police seized 36 000 bottles of
cooking oil stashed at the company's warehouse.
The Zimbabwean government last month ordered business leaders to roll
back prices to June 18 levels following a massive hike in prices over the
previous two weeks.
Harare accused the business leaders of working with the government's
western enemies to increase prices so as to foment an uprising against
Mugabe, a charge business denies.
The Harare authorities have since deployed soldiers and police to
enforce the price freeze. At least 1 300 company executives and shop
managers have been since been arrested in the crackdown. - ZimOnline
Tuesday 10 July 2007
By Regerai Marwezu
MASVINGO - Ruling ZANU PF party youths in the southern town of Masvingo on
Sunday threatened to seize goods from shops that fail to heed a directive by
President Robert Mugabe to slash prices of all commodities by 50 percent.
At a meeting held at the Roger Howman training centre in the working class
suburb of Mucheke, the youths threatened to loot all shops that fail to
implement the government directive on prices.
ZANU PF legislator for Masvingo South, Walter Mzembi, convened the meeting.
"We resolved to loot all shops that are defiant. We have spoken to all
relevant government departments and everything that we discussed at the
meeting will be implemented," said Raison Muunye.
It was not possible to establish from Muunye, who is the party's organizing
secretary for youths in Masvingo, when the youths planned to go on the
Contacted for comment yesterday, Mzembi said: "We are going to back these
youths in their efforts to make sure that government policies are strictly
There have been scenes of chaos and pandemonium around the country as hungry
Zimbabweans stampeded to take advantage of reduced prices to stock on
Most shops in Harare and Bulawayo have been cleared of basic goods following
the government order issued last month to roll back prices to June 18
Mugabe accuses business of working in cahoots with his western enemies to
hike prices so as to foment rebellion against his government. The veteran
Zimbabwean leader says his government will seize all businesses that defy
his order to slash prices and stop production.
"We are living in perpetual fear," said a businessman who spoke to ZimOnline
At least 1 300 business executives and managers have been arrested around
the country since the crackdown, codenamed Operation Dzikisa Mutengo
(Operation Reduce Prices), began last month. - ZimOnline
SW Radio Africa (London)
9 July 2007
Posted to the web 9 July 2007
There are reports that thousands of businesses, including manufacturing
firms, countrywide are grinding to a halt despite threats by Robert Mugabe
that government would seize firms that stop producing basic goods. Already a
number of companies are laying off workers as a result.
Elton Mangoma, a businessman and acting treasurer-general of the MDC, said
the majority of other companies were scaling down operations following a
weeklong campaign to stop rampant inflation by physically forcing businesses
to lower prices. This move sparked frenzied buying from shoppers leaving
most shops with empty shelves.
Price controls have generally been short-lived and loosely enforced but in
contrast, the latest crackdown appears to be gathering momentum as enforcers
moved over the weekend to halt price increases by wholesalers and
manufacturers as well as retailers.
'This is history repeating itself. In 2000 Mugabe grabbed farms and
distributed them to his cronies and we have no food in the country as a
result. Now he wants to grab companies and who ever will take over to manage
them will fail like what the new farm owners did,' Mangoma said.
Mangoma believes the price controls being enforced by the regime are edging
the nation close to total chaos, because 'this will leave many Zimbabweans
with lots of cash in their pockets but with nothing to buy.'
Mugabe on Friday told manufacturers to carry on with normal production
despite an official price freeze, warning that his regime will take over
firms that stopped producing basic goods. Addressing thousands of his rented
Zanu PF party supporters in the capital, he warned; 'This is no joke ...
there are some people who think this (freeze) will not succeed because they
say there are empty shelves. We are saying to all factory owners you must
produce. If you don't produce we certainly will seize the factories.'
Amid the ongoing economic chaos the MDC's secretary for Labour and Social
Affairs Getrude Mtombeni said they were busy compiling figures of workers
who have lost jobs in the last week. She said employers are being forced to
lay off workers because they are not making any profits or extra money to
pay them. She said most companies would cease to operate in the next six
Spiralling prices and soaring inflation are part of an eight-year economic
crisis caused by government's mismanagement. Economists believe the price
freeze will finally destroy what remains of the country's struggling
industry, as manufacturers will not be able to produce goods at a loss.
'Nobody wants to lose money deliberately and nobody wants to invest into a
company that makes losses instead of profits. This is real economic
madness,' Mtombeni said.
She added that the price rollbacks were unsustainable and that shops and
manufacturers would soon shut down and lay off their workers.
July 10, 2007 Edition 1
Zimbabwe's descent into chaos has been as predictable as it has been tragic.
President Robert Mugabe's economic policies and anti-democratic tendencies
have brought the country to its knees.
Now official inflation is running at a world record 5 000%, with unofficial
estimates at about double that. Businessmen are being rounded up by police
in what appears to be a desperate attempt by Mugabe to quell a public
uprising. Store shelves are empty and petrol pumps dry.
Perhaps the only positive from this grim scenario is that it gives some
leverage to those trying to persuade Mugabe to change course.
Today, for example, talks between Zimbabwe's ruling Zanu-PF and opposition
Movement for Democratic Change begin in South Africa. These talks have been
mandated by the Southern African Development Community (SADC), as have
attempts to find a solution to Zimbabwe's economic crisis.
In normal circumstances it might be held that the economic recovery should
follow a political solution, but Mugabe's reign has hardly been normal.
Perhaps now a financial solution will be more compelling for Mugabe. This
may come in the shape of the sort of loan that he has rejected previously,
or even a common monetary area.
Whatever form such an initiative takes, it must be on condition that Mugabe
launches a comprehensive set of political reforms.
This will require of the SADC a toughness that it has failed to muster in
previous dealings with the Zimbabwean despot.
Hopefully the seriousness of the situation in that country - and the
devastating impact on ordinary Zimbabweans - ensure more decisive action
July 10, 2007
By Ethel Hazelhurst
Johannesburg - An attempt to rescue Zimbabwe from hyperinflation by
replacing its increasingly worthless currency with the rand would be
pointless unless the move was part of a broad programme of economic reform,
economists said yesterday.
Inflation in Zimbabwe, officially at 3 713.9 percent in April, is likely to
be much higher and is rising so quickly that its population is reportedly
resorting to barter. And according to Zimbabwean economist John Robertson,
the country's fiscal deficit - the shortfall between government revenue and
spending - is equal to about 140 percent of gross domestic product.
After the government knocked three noughts off the exchange rate in April,
the currency officially trades at Z$250 to the US dollar. But on the black
market, it has reportedly been trading as high as Z$400 000.
The Sunday Independent said that the Southern African Development Community
"is reportedly considering a proposal that the Common Monetary Area [CMA] be
extended into Zimbabwe".
The CMA is made up of South Africa, Namibia, Lesotho and Swaziland. The
smaller economies' currencies are pegged to the rand.
Jac Laubscher, Sanlam's chief economist, said that if the rand were to
replace the Zimbabwe dollar, there would have to be greater integration of
the two economies.
Among other things, a common monetary policy implies the same interest rates
in the countries.
The official rate at which the Reserve Bank lends to the private sector
banks is 9.5 percent, about 3 percentage points above its benchmark
The equivalent rate in Zimbabwe is 600 percent, according to Robertson -
thousands of percentage points below the inflation rate.
Monetary union with South Africa would imply a switch to positive real
interest rates. But while positive rates are used to restrain inflation,
they can never work in isolation.
"Zimbabwe has been funding its deficit by printing money," said Rudolf
Gouws, the chief economist at Rand Merchant Bank.
Unless the Zimbabwean government takes the politically difficult route of
sharply reducing its expenditure, sound monetary policy and a new currency
will be ineffective.
Greater integration of the two economies would hurt South Africa and its
But Laubscher said the impact would be limited because Zimbabwe's economy,
at about US$4.5 billion, was much smaller than South Africa's, which is
worth more than US$240 billion.
MONEYWEB: Off to Harare now, where we link up with Dzika Danha, an analyst at Renaissance Capital in Harare. Good to be with us this evening, Dzika. Let's maybe start off with the controversial laws that have been introduced by President Robert Mugabe, trying to force retailers to halve their prices. I guess the impact of that has been retailers aren't going to be putting too much up for sale?
DZIKA DANHA: Yes, precisely. The immediate impact is there's been a reduction of goods on the shelves. I think we will really feel it in a big way in probably a couple of weeks, because the government is very heavy-handed about trying to enforce it. So I think guys are just going to try and get rid of their stock while they can, but the problem is down the line - manufacturers are already sort of slowing down production.
MONEYWEB: I guess it's no surprise there, because who would like to produce something when you're guaranteed that you are being forced to sell it at a loss?
DZIKA DANHA: Ja, that's the problem and the replacement cost of this stock - that's we're going to miss our stock cycle, and there will be widespread shortages probably in a couple of weeks. The black market is already showing signs of leaning to a lot of these commodities.
MONEYWEB: Dzika, where to from here? When there isn't food in the shops, I guess one would say simplistically that there are going to be riots in the streets.
DZIKA DANHA: That would be the obvious logical step, but I'm not so sure. I don't know how long they are going to enforce this, once they realise how serious their actions are. But you're right, social tensions will escalate if there really is no food on the shelves. But I mean, the main product is this, it's going to see inflation spike like we've never seen before.
MONEYWEB: Dzika, what about what's happening at the fuel pumps? The Financial Times of London or FT.com was reporting today that police have instructed filling stations to cut their prices by two-thirds, and then gone on to tell bus owners they must cut their fares by 80%. Are people complying?
DZIKA DANHA: From what I see, the few, I mean people who stop selling fuel - and consequently the black market price has spiked beyond even the actual power market rates value of that fuel. So it's a case of guys are just holding it now, they are not selling it. And there is no fuel readily available. As for the bus drivers - look, if they were to comply, they would be out of business fairly quickly.
MONEYWEB: There were reports today that the financial director of Edgars has been arrested.
DZIKA DANHA: Yes, we had the front pages of the The Herald, the daily here, 32 directors were arrested for flouncing these price control regulations. So yes, it's getting quite ugly on that side.
MONEYWEB: Now you work with a multi-national, Renaissance Capital. What kind of reports are you sending back to people in other parts of the world?
DZIKA DANHA: Well, I'm [indistinct - poor line] valuation perspective, and trying to buy when the market is cheap. So far the Zim stock exchange has done actually quite well in hoding value, but with [indistinct] and we are probably going to see some sort of dollarisation or indexation. So I think the demand for currency is going to go through the roof, which might make assets cheaper again.
MONEYWEB: We have, however, seen the Zimbabwe Stock Exchange plunging last week. It's gone up expedentially so far this year, but it took an awful hammering last week with these new laws.
DZIKA DANHA: Ja, it's down 26% from Thursday last week to yesterday. So it has taken a pounding and, look, these companies are under serious [indistinct] and our margins are being eroded completely. They will be making some losses fairly soon.
MONEYWEB: But certainly from that perspective, Dzika, if you are being forced by government to sell at below cost price or face being grabbed, I suppose, in the same way as some of the farms were grabbed by the president and his cronies, then the companies that are listed on the stock market can't be worth a whole lot?
DZIKA DANHA: No, you're right, from a customer perspective, no. But in terms of value perspective, ja, it's still the cheapest market in the world. But yes, this raises a bit of issues and there's going to be a lot of selectivity in stock-picking going forward. It's just [indistinct] blue chips and dual-listed stocks.
MONEYWEB: Earlier this year there was quite a lot of hope that this was the beginning of the end. It certainly seems to have got a lot worse since then.
DZIKA DANHA: Yep, it has, predictably. And it's going to get a lot worse a lot quicker now. I think in two weeks' time or in a month's time, inflation will ratchet up even more, and I don't know how the end is going to look like. But we're closer than we've ever been, really.
MONEYWEB: And what are you doing with your family? Are you keeping them indoors or are you quite happy for your kids to walk to school and your wife to perhaps shop if there is a place to shop?
DZIKA DANHA: I'm not married, unfortunately. But look, physically it's safe. There's nothing really wrong. I mean, that's a gross misconception that people have about Zimbabwe. It's actually a very safe place, even now. It's just an economic thing which is the real story here - it's the ordinary person trying to struggle to make a living. In terms of safety, crime-wise, it's a lot safer than, let's say, Jo'burg.
MONEYWEB: But at some point in time that has to change, surely?
DZIKA DANHA: You'd have said so, but it hasn't happened so far, I think, given the nature of the people here. But if they carry along in this vein here, it might well change.
MONEYWEB: How do you see all of this panning out, or how do you see it all developing from here?
DZIKA DANHA: I'm not prepared to give a view sort of six months, but a couple of months down the line, I think inflation is going to peak in the next six months. We are going to reach that vortex of hyper-inflation when things just don't function, and from them on that might be some sort of tipping point for a change.
MONEYWEB: Dzika Danha, talking to us from Harare. He is with Renaissance Capital.
By Carole Gombakomba
09 July 2007
A prominent Roman Catholic priest in Zimbabwe said Monday that "vulgar"
attacks by President Robert Mugabe on senior church officials had
extinguished hopes for a reconciliation between Harare and the country's
During a consultative assembly of his ruling ZANU-PF party on Saturday in
Harare, Mr. Mugabe criticized "some bishops" for "rallying behind the
opposition MDC and openly supporting the Western backed regime-change
Earlier this year the country's nine Roman Catholic bishops issued a
stinging rebuke to Mr. Mugabe in an Easter pastoral letter. The prelates
reproached him for failing to meet the needs of the people, and urged him to
resign or face a popular revolt.
In his remarks on Saturday, Mr. Mugabe accused church leaders of failing to
practice democracy within their institutions and of straying from their vows
Roman Catholic Archbishop Pius Ncube of Bulawayo, one of Mr. Mugabe's
toughest critics, last week urged Britain to invade Zimbabwe to remove him
Father Oscar Wemter, a Harare-based theologian and writer, told reporter
Carole Gombakomba of VOA's Studio 7 for Zimbabwe that although different
church leaders have taken different approaches to Mr. Mugabe, he has proven
By Jonga Kandemiiri
09 July 2007
The National Constitutional Assembly, a leading Zimbabwean civic
organization, said police and agents of the Central Intelligence
Organization harassed and detained its members in Mashonaland East and
Manicaland provinces last week.
The Harare-based organization said 12 members in Marondera, Mashonaland
East, were detained for four nights by police after being arrested for
holding a private meeting. Those arrested included three women with babies,
NCA officials said.
All of those detained were released on Monday without any charges being
pressed against them, the NCA sources said.
Elsewhere, the NCA's Manicaland provincial chairman, Elisha Makuyana, and
another activist, were picked up Friday night by suspected CIO operatives,
the NCA said.
Organization sources said state agents confiscated more than 50 T-shirts,
shortwave radios and fliers. Makuyana and the other activist were released
late Friday night, but were ordered to report to the CIO's offices the next
day, the NCA said.
NCA National Chairman Lovemore Madhuku told reporter Jonga Kandemiiri of
VOA's Studio 7 for Zimbabwe that he believed such tactics were intended to
instill fear in his group's members to keep them from demanding reforms like
a new constitution.
By Blessing Zulu and Ndimyake Mwakalyelye
09 July 2007
The stampede for bargains last week after Zimbabwe's government ordered
prices slashed gave way Monday to long lines as consumers hunted
increasingly scarce basic commodities such as bread, maize meal, cooking oil
Fuel, cement and other durable items had also disappeared, increasing the
complexity of accomplishing ordinary tasks for Zimbabweans at all income
A source in the Ministry of Finance disclosed that only 1 million liters of
fuel are in the government's energy supply pipeline and when that is done
the future is bleak. The government is chronically strapped and most
suppliers demand cash up front.
Yet in the face of a deepening economic crisis, Harare was adamant that it
would not back off its campaign to reverse hyperinflation. Authorities said
they arrested some 1,300 shop owners and business executives in recent
days - 33 managers appeared in court Monday. All but two pleaded guilty to
violating the Prices Control Act that went into effect on Friday. They were
freed after posting Z$3 million dollars bail each.
Trade Minister Obert Mpofu promulgated a one-month statutory instrument
legalizing the state's blanket ban on price increases - no price can be
raised unless the ministry approves and the instrument obliges all
businesses to clearly display prices.
Business leaders said they can only wait and see what happens next, noting
that their efforts to reason with the government had failed and that the
latest directives are understood to come from President Robert Mugabe
Consumer Esther Makoni of Highlands told reporter Blessing Zulu of VOA's
Studio 7 for Zimbabwe that supplies were running short in an increasingly
Reactions to recent developments included a 60% decline in the benchmark
index of the Zimbabwe Stock Exchange, which tumbled 30% on Friday alone.
ZSE Chief Executive Officer Emmanuel Munyuki told reporter Blessing Zulu
that of VOA's Studio 7 for Zimbabwe that most listed companies have been
Economists expressed deep concern about the impact of the state initiative.
Reporter Ndimyake Mwakalyele interviewed independent economist David
Mupamhadzi and Eddie Cross, an economist who serves as policy coordinator
for the Movement for Democratic Change faction headed by Morgan Tsvangirai.
Cross said the statutory instruments rushed into force late last week to
make the price cuts permanent were likely to paralyze an already traumatized
By Byron Dziva in Harare
Last Updated: 2:03am BST 10/07/2007
Zimbabwe's economy was approaching paralysis yesterday as petrol
stations across the country ran dry.
President Robert Mugabe's regime has ordered all retailers to cut fuel
prices by 60 per cent, a move that forces them to sell petrol at a loss.
As a result, filling stations across the country have stopped selling
altogether and petrol is only available on the black market, at five times
the official price.
Without fuel, the entire economy is steadily shutting down.
"It is certainly making a bad situation worse. Many companies will
stop functioning," said John Robertson, an independent economist in the
A bus driver in Harare said: "At the moment, even on the black market,
there is nothing."
Basic foodstuffs have already vanished from supermarket shelves thanks
to the regime's order that all retail prices should be frozen at their June
Inflation has reached such a level that one banana costs the same
amount as 15 four-bedroom houses seven years ago. The regime's behaviour has
dismayed many business people.
Masimba Kambarami, the chairman of the petroleum association, said:
"Fuel is not indigenous, it has to be treated carefully.
"If you arbitrarily introduce new prices you trigger panic buying,
then subsequent shortages."
Inflation officially runs at 4,530 per cent - the highest level in the
By Staff Reporter
Last updated: 07/10/2007 10:12:40
CENTRAL Intelligence agents raided the office of a key Zimbabwean government
official and seized a laptop, documents and a mobile phone days before he
was publicly accused of being a part of an alleged plot to overthrow
President Robert Mugabe's government in a military putsch.
The sensational revelations show for the first time how Emmerson Mnangagwa,
a cabinet minister and powerful leader in Mugabe's ruling Zanu PF party, was
sucked into the alleged coup plot which has so far seen the arrest of at
least six men.
Intelligence sources told New Zimbabwe.com this week that on the evening of
May 25 -- four days before police made the first arrests -- a team of agents
from the Central Intelligence Organisation (CIO) broke locks and doors
leading to Mnangagwa's office and his aides as rumours of an attempted coup
swirled on the streets of Harare.
In an interview Monday, Mnangagwa confirmed the raid, but insisted he was
not aware who had broken into his office.
But the idea that it was an ordinary robbery has looked more and more
unsustainable after it emerged that the "intruders", after taking
Mnangagwa's laptop, made no effort to take his secretary's laptop despite
also breaking her door.
Mnangagwa said: "It is true that my office was broken into and the intruders
stole my laptop, documents and my Nokia communicator cellphone. They broke
the locks on all the doors leading to my office, my personal assistant,
secretary and deputy finance director.
"My PA lost $2 million. In the other two offices, the thieves did not pick
anything including a laptop that was in my secretary's office."
The CIO head office at Chaminuka Building is just meters from Mnangagwa's
Last night police confirmed receiving a report from Mnangagwa and said
investigations were yet to be completed.
"It is true we are handling a case of theft from the minister's office, but
we cannot say much as this may prejudice our investigations," said a police
The police revealed they had referred fingerprints to their forensic team,
but the investigation is yet to be completed almost seven weeks after the
As a rule, all government offices and buildings are under armed guard.
During the day, visitors are subjected to a body search and stringent
conditions such as producing valid national driver's licence and/or national
Intelligence sources said only the CIO could have circumvented the security
and carried out the operation in Mnangagwa's office which is on the 6th
floor of Kaguvi Building. The building houses the Ministry of Rural Housing
and Amenities, for which Mnangagwa is in charge.
The privately-owned Zimbabwe Independent newspaper reported last week that
the government wanted to arrest Mnangagwa over the alleged coup while Mugabe
was away in Libya and later Egypt.
Vice-President Joice Mujuru was the acting president when the plan was
hatched to seize Mnangagwa. Mnangagwa and Mujuru are bitter rivals in Zanu
PF, both vying for the control of the party.
Vice-President Joseph Msika is said to have intervened and demanded that the
government should not arrest Mnangagwa until Mugabe had returned.
Mnangagwa - who has described the coup allegations as "stupid" - was said to
have been very anxious as word spread that he could be arrested. He met
Mugabe soon after his return to deny any involvement.
Mugabe is said to have been furious at his security chiefs over their
handling of the matter, believing that the operation had destroyed Zanu PF
unity ahead of key general elections next March.
"The President was angered by the coup story and the botched operation by
the security agents. He is angry that this has left the party embarrassed
and deeply divided," said a source.
Police have arrested six suspected coup plotters - Albert Matapo, Emmanuel
Marare, Pattison Mupfure, Nyasha Zuvuku, Oncemore Mudzurahona and Shingirai
Webster Mutemachani -- after security agents learnt they intended to topple
However, the coup story has been described as storm in a teacup after
attempts to link it to Mnangagwa laid an addled egg.
The six men are currently in remand prison awaiting trial. They all deny
charges of plotting a military overthrow of the government.
:: The Southern African
Monday, 09 July 2007
TORONTO - One of the questions often asked by those watching the
Zimbabwe crisis unfold is: "Who provides the foreign currency that props
President Robert Mugabe's Zanu PF government?
After all, every economic indicator shows an economy that is so
battered it should have collapsed by now.
Inflation is now estimated at almost 5,000%, the Zimdollar trades at
such ridiculous exchange rates as 400,000 to the USdollar, unemployment is
beyond 80%, supply of basic commodities is erratic and yet, the fat cats
continue getting fat and the government system still gets foreign currency.
Fingers have previously been pointed at the more than three million
Zimbabweans in the Diaspora who have propped up the economy through forex
they send to families back in Zimbabwe.
But much as that is true, it would never be enough to maintain a whole
But for those who did not know, certain laws and agreements compel
foreign investors in Zimbabwe to provide forex as long as they operate in
the country and nothing demonstrates this more clearly than a story that
appeared in Africa Confidential six months ago.
In an effort to answer the vexing question of "who props up Mugabe's
economy", we reproduce the story here in full:
British and South African banks have provided a more than US$400
million financial lifeline to President Robert Mugabe's government over the
last two years, much of it targeted at financing Harare's controversial land
This funding flies in the face of President Mugabe's routine attacks
on British 'neo-colonial sabotage' and claims that his government receives
most of its vital funding from its radical allies in Asia and Latin America.
It also shows that Britain has become complicit in propping up the
regime, according to opposition MPs at Westminster.
Britain's Barclays Bank lent over Z$300 billion ($49.3 mn.) in 2005,
on concessional terms, to the government's Agriculture Sector Productivity
Enhancement Facility, aimed at consolidating the land-reform programme and
boosting falling farm productivity.
Barclays also arranged offshore financing facilities of $110 mn. for
Zimbabwean clients in tobacco, cotton, mining, sugar, manufacturing and
We understand that Barclays' upcoming annual report for 2006 will show
a similar pattern of lending over the past year.
Until a month ago, Barclays' new partner, South Africa's ABSA, held a
24.1% stake in the Commercial Bank of Zimbabwe which was formerly run by
Mugabe ally and current Reserve Bank Governor Gideon Gono.
CBZ - together with ABSA - managed a Treasury bill portfolio in
Zimbabwe of over Z$2.7 trillion ($443 mn.) in 2005 and reached similar
levels in 2006.
Barclays told Africa Confidential that agricultural lending to the
Zimbabwe government will continue in 2007, as will investment in treasury
bills and bonds, 'from time to time, depending on our relationship with the
British-based Standard Chartered Bank and insurance giant Old Mutual
also lend the Mugabe government billions of Zimbabwean dollars through their
purchase of treasury bills and government bonds.
Under the Reserve Bank's statutory reserve requirement, commercial
banks must reinvest 40% of their surplus in government treasury bills and
insurance houses must bid for them.
Companies say that they are merely complying with Zimbabwean law.
'This is part of doing business in Zimbabwe,' Standard Chartered's Sean
'It affects all banks doing business there.' But several Zimbabwean
economists calculate that Old Mutual's lending to the Mugabe government is
so high that it has become a critical prop for the regime's financial
Opposition British MPs argue that lending to the Mugabe government has
become morally indefensible. Liberal Democrat MP Norman Lamb told Africa
Confidential: 'By going along with the rules provided by the Zimbabwe regime
they [the companies] become complicit with the actions of the Zimbabwean
government and complicit with a corrupt regime.I struggle to see that as a
Conservative party MP Boris Johnson said the lending reflected British
disinterest in the plight of Zimbabwe: 'its part of a much bigger problem.we
have to face the fact that we've done nothing to remove a tyrant responsible
for untold deaths and complete ruination of the economy.'