13 July 2012
Violet Gonda | London
The European Union Ambassador to Zimbabwe Aldo Dell'Ariccia dismissed
reports Friday that the EU is set to lift sanctions against President Robert
Mugabe and top officials of his Zanu PF party.
A British newspaper said this week the EU will remove the measures it
imposed in 2002 in protest of bad governance by Mr. Mugabe and his
But Ambassador Dell'Ariccia told VOA "nothing has been decided yet."
“Discussions are ongoing, so we don’t know what is the origin of this news,
but I can tell you that it is not the case," he said. "It’s not what is
written in a British newspaper that should be taken into consideration for
The ambassador said the sanctions, including an arms embargo, are only due
for review next February, unless the Harare situation improves, which may
trigger an earlier consideration.
The UK Daily Telegraph claimed that the finalization of Zimbabwe's new
constitution will pave the way for a meeting in Brussels next month where
the sanctions deal would be sealed.
Ambassador Dell'Ariccia added that discussions were currently underway
between Harare and the EU to review general cooperation under the Cotonou
Agreement that was suspended by the EU in 2002, resulting in the suspension
of aid through government because of human rights violations.
“The deadline for the review of the approbate measures, not the restrictive
ones, but the approbate measures that refer to the cooperation between the
European Union and Zimbabwe is due on the 20th of August.
“The discussions are going on now because the idea was that maybe, the
Foreign Affairs council of the 23rd of July, a decision would be taken on
the approbate measures and possibly on other measures based on the
assessment of the situation. But the fact is that there is no decision yet.”
Observers believe the EU will take this opportunity to reconsider the
cooperation aspect, but maintain the sanctions on some members of Mr.
Mugabe's party to put pressure on them to implement meaningful reforms.
The political changes expected by the international community, including the
EU, include a new constitution, the adoption of rights laws and holding of
However, political parties in the unity government and the Southern African
Development Community continue to demand the unconditional removal of the
sanctions, saying they are impacting ordinary Zimbabweans.
Activists disagree. Human rights lawyer Gabriel Shumba says Harare has yet
to implement reforms that warrant the removal of sanctions, adding the
measures should remain.
“You describe them as sanctions the moment a block has said we are
suspending cooperation fully," Shumba said. "But in this case the U.S. and
the EU continue to be the biggest supporters of humanitarian aid in
13 July 2012
Sandra Nyaira | Washington
The MDC formation of Prime Minister Morgan Tsvangirai says it will
renegotiate all deals signed between the Zanu PF government and foreign
investors like China, especially in the controversial Marange diamond
Citing the deal between Harare and Chinese company Anjin Investments in
Chiadzwa, Minister of State in the Prime Minister’s Office, Jameson Timba,
said Zimbabwe was losing billions in revenue due to agreements favoring
countries like China.
Anjin, he revealed in a talk Thursday at the Robert F. Kennedy Centre for
Justice and Human Rights, owns 90 percent of the joint company with the
Zimbabwe Mining Development Corporation (ZMDC) taking only 10 percent.
Timba said Harare gave the Chinese 90 percent shareholding in the company to
offset a $500 million debt with China for arms of war delivered to Zimbabwe
by the Chinese government.
“I admit that as a party we lost the war on diamonds,” Timba said in
response to a question on how diamond revenues have propped President Robert
Mugabe’s Zanu PF party.
“However, we are maintaining that there should be more transparency in the
way the diamonds are sold. The companies continue to hide behind the
sanctions issue saying America will trace our money since the ZMDC is on
sanctions so the government gets a little bit and some of the money goes
into private pockets.”
He said his party was not happy with some of the deals entered into between
Harare and foreign investors in Marange, adding they will all be revised
when the MDC gets full control of the government.
Speaking on other issues affecting Zimbabwe presently, Timba said the will
of the people should be respected in the next election, adding the nation
and the region would be plunged into instability if that does not happen.
He said his party is pushing for democratic reforms, in particular demanding
the re-establishment of the Central Intelligence Organization through an Act
of Parliament for oversight by lawmakers. His party, Timba said, also is
worried by the conduct of some senior military officers and partisan
policing, among other issues.
Commenting, Advocacy Officer Jeffrey Smith of the Kennedy Centre for Justice
and Human Rights said he was shocked by the revelations regarding Anjin
Investments in Zimbabwe.
“That was actually an interesting revelation where he mentions that the
agreement that exists between Zimbabwe and Anjin corporation has essentially
been used to pay an upwards of $500 million to China for debts for the
purchase of military hardware and obviously the question there is what is
that military hardware going to be used for," said Smith.
"Zimbabwe faces no external threats so clearly so clearly those are going to
be used against the people of Zimbabwe as instruments of violence,” said
13 July 2012
Chris Gande | Washington
Former deputy spokesperson for the MDC formation of Zimbabwean Prime
Minister Morgan Tsvangirai Thabitha Khumalo says her removal from the post
is not a demotion but part of a restructuring exercise.
“My understanding is that the party is restructuring ahead of the elections
so my removal from that position is part of that,” she said.
Sources on Tuesday said Khumalo had a fall-out with the party leadership
over a raft of complaints ranging from her leadership of a faction of the
Zimbabwe Congress of Trade Unions to the factionalism in the party in
On the issue of her dalliance with the labor body she said: “I was elected
in absentia and my party understands that.”
Khumalo told Studio 7 the letter relieving her of her duties did not
indicate that the leadership was not happy with her, adding she was being
reassigned to a position not yet disclosed.
“It is not true that I have a misunderstanding with my party because I am
waiting to be deployed,” she said.
July 13, 2012 in News
THE complicity of MDC-T and Zanu PF MPs in rubber-stamping the contentious
Electoral Act Amendment Bill and Zimbabwe Human Rights Commission (ZHRC)
Bill by allowing Justice minister Patrick Chinamasa to push it through the
crucial committee stage has come under fire.
The watered down bills sailed through the committee stage on Tuesday in time
for the visit of South African President Jacob Zuma’s facilitation team
expected next week, but the Crisis Coalition in Zimbabwe and the Zimbabwe
Lawyers for Human Rights say their passage must not hinder the country’s
quest to investigate past atrocities.
Crisis Coalition in Zimbabwe regional co-ordinator, Dewa Mavhinga, said the
passage of the ZHRC Bill should not be the end of Zimbabwe’s quest to
address state-sponsored atrocities of the past not covered by the bill.
“The ZHRC may have a mandate to investigate human rights abuses only from
February 13 2009, but this must never be taken to mean impunity from past
crimes, including 2008 political murders, criminal aspects of the 2005
Operation Murambatsvina as well as Gukurahundi,” said Mavhinga.
He said the MDC formations and parliament should have followed advice from
UN Commissioner for Human Rights Navi Pillay to look at other mechanisms to
address past atrocities.
“There must be a separate institutional set-up to deal with past abuses like
a Truth, Justice and Reconciliation Commission, and this is what the MDC
formations must insist on without compromise,” Mavhinga said.
Zimbabwe Lawyers for Human Rights director Irene Petras concurred with
Mavhinga saying experience from the region shows that there is a clear
separation of institutions or instruments used to look into the past,
on-going and future violations.
“However, this (ZHRC Bill passage) should not be used as a barrier to look
into past atrocities and efforts should be sought to establish a mechanism
to deal with the past,” said Petras.
However, Petras said they welcomed the ZHRC Bill passage as it would
operationalise a commission that has been idle since 2010 when it was first
MDC president and Industry and Commerce minister Welshman Ncube last week
told the Zimbabwe Independent that cabinet had agreed to steer through the
Ministers from both the MDC-T and Zanu PF turned up in parliament to ensure
the backbenchers would not derail the cabinet-approved decision.
Chinamasa reminded the MPs, who have been reluctant to pass the bills for
failing to address historical atrocities, that without a bipartisan approach
all bills would not be approved by parliament to the detriment of the
“No one party can move the law by itself,” said Chinamasa. “This law may not
satisfy all perspectives, but we have to move forward. We have to rise above
our sectional interests and base instincts.”
MDC-T MPs led by Mbizo legislator Settlement Chikwinya had earlier torn into
the clause restricting the ZHRC from investigating cases that occurred
before February 2009, describing it as a deliberate ploy to shield Zanu PF
functionaries from prosecution for atrocities committed since independence.
Chinamasa made minor concessions to sweeten the passage of the bills by
agreeing to MDC-T Mutare Central MP Ian Gonese’s calls for the ZHRC Bill to
allow the state to accept international treaties as part of domestic law
once they have been ratified.
July 13, 2012 in News
THE reactive intervention by the Reserve Bank of Zimbabwe (RBZ) in Interfin
Banking Corporation, which was placed under curatorship for six months,
exposed weaknesses in the RBZ’s governance structures emanating from
conflict of interest.
While the central bank rightly observed that concentrated shareholding and
abuse of corporate structures basically exposed Interfin to a huge sum of
insider loans, little was said of the close connection between certain
members of the Nssa board and the demise of the bank.
Nssa is a significant shareholder in Interfin, having a 10,3% stake. Nssa
was also exposed as a major depositor, with almost US$16 million trapped in
It is clear from an analysis of the bank’s exposures that some members of
the Nssa board and management had severely conflicted positions with respect
to their dealings with Nssa.
A glaring instance is the US$3,58 million loan owed to Interfin by Harambe
Holdings, a company which — according to investigating authorities — is 80%
owned by David Govere’s Noxon Investments. This loan was classified by RBZ
examiners as a loss, meaning its recovery is doubtful despite being secured
by a first mortgage bond on a property through guarantees by another of
Govere’s companies, Medworth Investments.
What is interesting about this loan is that Govere is a member of the Nssa
board of directors and chairman of the institution’s investments committee.
This is the same committee that presided over recommendations for the
placement of the US$16 million in deposits that Nssa eventually lost upon
The main question therefore is not whether Govere as chairman of the
investments committee at Nssa appropriately recused himself from the
processes that approved the decision to “lend” Interfin a total of US$15 874
086 in policyholder funds. Rather, the question is: Did he disclose to his
fellow board members his personal interests and dealings with
While it can be argued that Nssa’s decision to “invest” in Interfin was
independent of the credit decisions made by Interfin, if Govere did declare
his interests as good corporate governance demands, he should be commended.
But then again, it boggles the mind why for this particular loan Interfin
engaged Atherstone and Cook — a firm in which Govere’s fellow board member
Innocent Chagonda is partner — to act on its behalf.
Curiously, the bank lists its legal advisors as Kantor & Immerman as well as
Dube, Manikai & Hwacha. Chagonda’s Atherstone & Cook is not listed, and yet,
in this particular instance, it is the one handing the litigation.
Again it is not clear whether Chagonda also appropriately recused himself
from investment decisions made by Nssa, given the seriousness of the matter
his firm was handling on behalf of the bank’s client. Indeed, Atherstone &
Cook is a competent and reputable law firm and would ably represent the
bank. But it would be messy if a partner in the firm has to sue a fellow
board member for such a huge sum.
Atherstone & Cook is listed as a major depositor in Interfin, having had
more than US$2,5 million deposited in the bank when it was placed under
curatorship. Fortunately for the bank, the curatorship protects it from
litigation; otherwise there would be a situation where Atherstone & Cook
would sue Interfin (its client) for US$2,5 million.
There is a web of relationships and counter-relationships which are
unhealthy in that they maybe construed to have influenced decisions before
or after events.
The independence of directors at both institutions is clearly in question
and must be looked at in the context of the RBZ findings. It is clear that
inadequate firewalls existed at Interfin and Nssa.
A third but equally curious conflict existed between the bank and its
external auditors Pricewaterhouse- Coopers (PwC). The Reserve Bank noted
that PwC had overstayed their mandate.
In terms of section 41(4) of the Banking Act (Chapter 24:20) a banking
institution is supposed to change its external auditors at least every five
years, but both the bank’s board and curiously the auditors themselves
failed to detect this very clear breach.
July 13, 2012 in News
PRESIDENT Robert Mugabe reportedly instructed his deputy, John Nkomo, to
block former cabinet minister Nkosana Moyo from delivering the opening
lecture at the launch of the Joshua Nkomo Lecture Series at the National
University of Science and Technology (Nust) in Bulawayo.
Sources told the Zimbabwe Independent this week that Mugabe held a private
meeting with Nkomo on the sidelines of the Zanu PF central committee meeting
in Harare a fortnight ago where he expressed concern over Moyo’s Nust
lecture, which excluded him.
Mugabe instructed Nkomo, who is part of the Joshua Nkomo Foundation, to
cancel the event at the 11th hour.
The lecture was meant to coincide with the 13th anniversary of Nkomo’s death
on July 1 1999. It had been organised by the Associated Newspapers of
Zimbabwe, publishers of the Daily News, the Nust Journalism Department and
the Joshua Nkomo Foundation.
It had initially been reported that Zanu PF had blocked the launch of the
Nkomo lecture, but senior party officials in Bulawayo said the decision was
made by Mugabe and Nkomo without consulting top Matabeleland officials.
“It’s Mugabe who didn’t want Moyo to address the event,” said the official.
“He instructed Nkomo to make sure the lecture was cancelled at the last
Mugabe is now expected to deliver the lecture sometime this month or next
month. — Staff Writer.
July 13, 2012 in News
THE Federation of African Journalists (Faj) attending the 19th session of
the African Union summit in Addis Ababa, Ethiopia, is lobbying the different
AU commissions and ambassadors accredited to the continental body for a
legally-binding resolution on the protection of journalists amidst an
upsurge in attacks on scribes on the continent.
The Faj board has been engaging the Peace and Security Council and Permanent
Representatives Committees to adopt a binding resolution to protect
journalists, and to follow up on the decision of the AU Commission on Human
and People’s Rights on the safety and protection of journalists.
FAJ president Omar Farouk told the Zimbabwe Independent on Tuesday six
journalists were killed in Somalia in the course of their duties this year
while one was killed in Nigeria after an attack by an Islamic sect, Boko
Seven journalists were killed in Libya during the Arab Spring revolution
last year and four died in Somalia. About 32 journalists have been jailed
for more than 10 years in Eritrea and four have died in jail.
In Zimbabwe, journalists have routinely been harassed by security forces and
supporters of the former ruling party, Zanu PF.
Media, Information and Publicity minister Webster Shamu used World Press
Freedom Day in May to threaten journalists from the privately-owned media
with a return to an era of media controls if they persisted with an
“anti-African and anti-Zimbabwe frenzy”. — Staff Writer.
July 13, 2012 in News
SINCE Independence, Zimbabweans have endured and witnessed countless
incidences of harassment, assaults, rape, different forms of torture and
extra-judicial killings by state security agents and partisan political
June 26, the International Day of Support for Victims of Torture in
Zimbabwe, went eerily quietly with no official recognition.
On this day in 1987, the UN Convention Against Torture came into force
requiring member states to take effective steps to prevent torture in all
UN Human Rights Commissioner Navi Pillay, who recently visited Zimbabwe at
the invitation of government, marked the day by releasing a statement
reminding member states to respect their obligations to outlaw torture,
saying a lot still has to be done.
“Torture is increasingly criminalised in the law books of states and police
training curricula frequently incorporate the provisions of the convention.
Yet much remains to be done. The use of torture is far from over. Torture is
illegal under any circumstances and there are no exceptions,” the statement
In Zimbabwe, the winter month of June has in many years been marked by
torture since Independence.
Just two months after Zimbabwe celebrated its freedom on April 18 1980,
about 400 Zipra guerrillas were rounded up by security forces and taken to
Khami Prison where they were tortured. This reached boiling point in 1982
leading to the Gukurahundi massacres.
In its 1997 report, the Catholic Commission for Justice and Peace (CCJP) and
the Legal Resources Foundation stated that more than 7 000 cases of torture,
more than 10 000 arbitrary detentions, about 3 000 extrajudicial killings
and hundreds of abductions took place in Matabeleland and some parts of
Midlands during the Gukurahundi era.
An estimated 20 000 people were killed during the massacre period.
Fast forward to June 2000 — the first of many violently contested general
elections between the MDC and Zanu PF.
The land invasions of 2000 set the tone for increased electoral violence in
a way that had never been experienced before with voter intimidation,
abductions of opposition supporters and arbitrary beatings of civilians
being used to coerce people to vote for Zanu PF and President Robert Mugabe.
Between 2001-2004, 18 000 youths were recruited under a controversial youth
national service programme and sent to training camps where they underwent
political indoctrination before they were deployed to fight partisan
After the June 2008 presidential election run-off, local human rights groups
claimed at least 33 people had died from about 2 000 incidences of torture
which occurred in the run-up to the poll. More acts of violence followed in
the post-election period.
Most of the violence the country has experienced, especially in the run-up
to elections, has been blamed on Zanu PF as it seeks to maintain its
stranglehold on power at all costs.
The country’s security sector has been fingered as playing a crucial role in
poll violence, with security chiefs openly expressing their allegiance to
Zanu PF and Mugabe.
Deputy Justice minister Obert Gutu took a strong stance against torture and
spoke of Zimbabwe’s steps towards ratifying the Convention Against Torture.
Gutu told the Zimbabwe Independent that torture is very primitive and
dehumanises the victim and the perpetrator.
“The use of torture within our enforcement agencies bastardises the criminal
justice system,” said Gutu.
“The law is very clear in our constitution and we call upon law enforcement
officers to adhere to that. Zimbabwe is making progress towards ratifying
the Convention Against Torture and this is a historic event and a historic
development as the ratification would most likely impact positively on the
forthcoming electioneering process. I believe that it will help reduce
instances of political violence.”
At least 147 countries have ratified the convention.
According to the Ministry of Justice, Zimbabwe’s ratification and adoption
of the convention into domestic law means torture would be treated as a
Currently, Section 15 of the Constitution forbids torture and states: “No
person shall be subjected to torture or to inhuman or degrading punishment
or other such treatment.”
However, there is no legal definition for torture in Zimbabwean law. In the
absence of legislation, common law provisions on offences such as assault
and rape are often used to prosecute in cases of torture.
Local civil society groups are very critical of the inclusive government’s
failure to prosecute torturers.
In a statement issued on June 26, Crisis in Zimbabwe Coalition said despite
the existence of Article 18 of the Global Political Agreement which exhorts
the state to “apply the laws of the country fully and impartially in
bringing all perpetrators of politically-motivated violence to book”, the
perpetrators, although known, remain protected by a highly compromised
“The perpetrators continue to taunt the victims and boast they have not been
prosecuted for their heinous crimes because ‘tisu tirikutonga’ or ‘tisu
tiripanyanga’ (we are in charge of the country),” the statement read.
Highly critical of the state’s failure to deal with human rights offenders
and provide redress for torture victims of the 2008 election, the Zimbabwe
Human Rights Association (ZimRights) said no material government efforts
have been made to cater for those who survived such atrocities (2008s) yet
the nation is again expecting fiercely-contested elections most likely next
ZimRights observed June 26 under the theme “Rehabilitation works and is a
torture survivor’s right” by holding small prayer gatherings and candle-lit
vigils in Harare, Masvingo, Zaka, Gweru and Kwekwe. Victims shared their
testimonies while activists spoke about the impact of torture and possible
legal remedies for victims.
The director of the NGO for Human Rights Forum Abel Chikomo called on the
government to take concrete steps towards assisting victims.
“We urge government to translate its commitment into action as a matter of
urgency and implore it to establish structures and institutions for the
rehabilitation of victims of torture,” said Chikomo.
Despite frequent reports of violence by state security agents, Gutu remains
optimistic the law would be effective and in place by the next elections.
“I am pretty confident that before the next elections, there will be a
convention against torture that would have been properly domesticated and
will be in place by then,” he said.
If so, the next polls would test the strength of this law since most
perpetrators of previous election-related violence remain scot-free.
Much remains to be done in support of victims of torture, but if the
proposed law can offer justice to survivors, it would give more meaning to
July 13, 2012 in Business
YOUTH Development, Empowerment and Indigenisation minister Saviour
Kasukuwere says indigenisation regulations he gazetted two weeks ago have
been misconstrued, particularly those relating to the education sector.
In an interview this week, he told businessdigest that government did not
intend to take over all private schools, adding the notice relating to the
education sector was confined to private schools owned by for-profit
He dismissed reports that government wanted to takeover trust-run private
schools and church-owned schools, saying the regulations were supposed to
give clarity on a sectoral basis.
Government’s indigenisation and empowerment policy has often been attacked
for lack of clarity and cohesion.
“Trust schools are out and so are church-owned and run schools. In fact, the
regulations only apply in instances where someone is coming to invest in a
private school for a dividend. This means that such an investment would need
to be indigenised. That aspect of indigenisation regulations has been
misconstrued as this was supposed to bring clarity in terms of how
government was going to proceed with the policy on a sectoral basis,” said
He said, “the gazetted covered private colleges and not trust schools”. The
trusts are Zimbabwean-controlled and have no particular shareholders.
Where there is a company intending to own schools, surely they must partner
Zimbabweans, communities or government. A private college training computer
programmes and operating as a company will be treated as a business, he
The notice says private colleges, universities, primary and secondary
schools with a net asset value of a dollar would be required to comply by
June next year.
Minister of Education, Sport, Arts and Culture David Coltart concurred with
Kasukuwere on the regulation affecting educational institutions.
“I am pleased to report that I had a very constructive discussion with
Minister Kasukuwere this evening regarding the Indigenisation notice
“We are agreed that the rights contained in section 20(3) of the
Constitution, namely the right of religious and other groups to set up and
run schools, will be fully respected by government,” he said in a post on
“Accordingly, all mission, church, religious, community and trust schools
run not for profit will not be subject to any indigenisation policy. I hope
that the agreement in this regard will settle all those parents, teachers,
administrators and other interested in the education sector who feared that
this critically important component of our education sector was going to be
disrupted. I encourage all those who have been concerned this past week to
stop worrying and to get on with the fine work they have been doing in
delivering a quality education to tens of thousands of Zimbabwean children.”
Asked to comment on the indigenisation regulations forcing foreign-owned
banks to sell controlling stakes to indigenous Zimbabweans, Kasukuwere said
the regulations were now cast in stone.
The cabinet committee on finance was yesterday expected to meet and thrash
out sticky issues on the indigenisation regulations.
The regulations, contained in a Government Gazette published two weeks ago,
effectively meant that Reserve Bank of Zimbabwe chief Gideon Gono, a critic
of Kasukuwere’s policy on foreign banks, had lost the battle.
But Gono, Kasukuwere and members of the cabinet committee on finance were
yesterday expected to narrow their differences on banks and ensure policy
Gono and Kasukuwere have exchanged bitter words over the minister’s
insistence that foreign-owned banks must sell controlling stakes to locals,
after Kasukuwere’s relative success in forcing major mining companies to do
The central bank chief argued that such a move would be the final nail on
Gono, however, has support from Finance minister Tendai Biti and key
government officials such as Prime Minister Morgan Tsvangirai, who maintain
the move to take over banks is a nullity.
Under the new regulations, foreign-owned banks operating in Zimbabwe have a
year to comply with the regulations.
The move to indigenize banks has drawn criticism from government and in the
— Staff Writer.
July 13, 2012 in Business
By Kumbirai Makwembere
GLOBAL equity markets were surprisingly positive in the first half of 2012.
As the year began, fears over the health of the global economy were high,
emanating from the debt problems in Europe which compelled the IMF to lower
growth forecasts for the global economy from 3.9% in 2011 to 3,5%.
Furthermore, the slowdown in manufacturing recorded in Asia, US and Germany
dampened hopes of a favourable outcome for equities. The US job market again
remained in the doldrums with the unemployment rate remaining stuck at 8.2%
whilst it hit a record high of 11,1% in the Eurozone.
Contrary to expectations, the major markets were positive, with the Nikkei
in Japan being the best performer by recording a jump of 6,52%. The S&P 500
was next in line, with a gain of 5,68%, whilst the duo of the Dow Jones and
the FTSE 100 rose by 2,57% and 1,57% respectively.
The JSE, which often mirrors the performance of overseas markets, posted a
gain of 5.39%. Equity markets benefitted from inflows of funds from other
asset classes as commodities and currencies amidst a gloomy outlook. Gold,
surprisingly, lost its safe haven status and is now in actual fact regarded
by many as a risky asset as it is tracking the Euro. Platinum and Nickel are
on the other hand suffering from reduced demand from Asia largely due to the
slowdown being experienced in the manufacturing sector.
Whilst punters on the global scene had something to smile about, the same
cannot be said for the locals.
ZSE maintained its path of destroying investors’ wealth, losing 9,53% during
the six months to June. February and May were the only positive months with
gains of 5.42% and 1.19% respectively. March had the worst loss of 6.35%
whilst January, April and June recorded declines of 5.03%, 5.27% and 0.05%
respectively. If anything, risk aversion among offshore investors remains
The ongoing drive to indigenise foreign-owned banks, together with the
gazetting of regulations to indigenise the remaining sectors of the economy,
amongst them private schools, will not do the markets any good. This is in
addition to uncertainty as to when elections are going to be held.
Furthermore, the bulk of the companies on the local bourse are riddled with
debt and performing below par. If there was a fear factor index for the ZSE,
it would be interesting to see where it would be trading currently – our bet
is that it would have shot through the roof by now!!
The resource index sank deeper in the red by 24,83%, dragged by a 42,5% loss
in Hwange and a 14,29% decline in Rio Zim. Hwange management recently
revealed at their AGM that talks with Development Bank of Southern
Africa(DBSA) had collapsed and they are pursuing a US$50 million facility
with PTA. RioZim on the other hand is still to come to the market with a
concrete plan of how they intend to turn around company operations. The
company needs a huge cash injection which market rumours allege the new main
shareholders, Gem Raintree, are incapable of providing.
Overall, market breadth comprised 29 gainers, 44 decliners and two static
counters. The top five performing counters were Falgold, General Beltings,
Afre, Zeco and Ariston. These had gains ranging from 158.3% to. Falgold has
become a market darling ever since it completed phase 1 of its
recapitalisation exercise which resulted in production and profitability
The Afre share price on the other hand responded positively to the
acquisition of a controlling stake in the group by NSSA which ended years of
tuckshop management at the company. We are however not sure what the reasons
pushing up the prices of the trio of General Beltings, Zeco and Ariston are
as their operations are still struggling.
Could it be the respective companies pushing up their share prices so that
their counters attain a market capitalisation above US$1 million, the
minimum threshold alleged to have been set by the ZSE for all listed
The bottom of the table was made up of familiar candidates, with losses
ranging between 56,5% and 95%. Chemco was the worst performer, and TSL, its
holding company, has since resolved to delist the struggling unit. Murray
and Roberts’ loss since the year began stood at 56,5%. Over the period, the
Securities Exchange Commission (SEC) reversed the acquisition of a
controlling stake in the company by Zumbani Capital, a consortium led by the
current board chairman, Paddy Zhanda, and former company chief executive
Canada Malunga, arguing that the transaction was done at a steep discount of
79% and that an offer should have been made to minority shareholders
The suspension from trading on the ZSE of Interfin, alongside Gulliver, was
the main highlight on the corporate front. It is alleged that the latter
failed to publish its results within the time frame stipulated by the ZSE
while the ban on the former was a result of the placing of its flagship
asset, Interfin Banking Corporation, under curatorship for a period of six
months. This was after investigations by the Reserve Bank of Zimbabwe
revealed that the bank had negative equity of US$93 million against
regulatory requirements of US$12,5 million, largely due to poor corporate
governance structures and abuse of depositors’ funds, together with a high
level of non-performing insider loans—hardly a surprise to the market.
Where should investors place their money now? As it stands, the equities
market is likely to continue disappointing till the year ends. Outlook for
the listed entities is not so promising as the bulk of them are heavily
borrowed; hence will continue incurring heavy finance charges.
The slowdown currently taking place in the broader economy is again likely
to impact negatively on company performance. Trading on the overseas markets
is expected to remain volatile as debt problems in the Eurozone seem to be
far from over.
In the past week, the People’s Bank of China and the European Central Bank
slashed their bank rates by 0.31% and 0.25% respectively. The Bank of
England on the other hand increased its asset purchase plan by £50 billion
(US$77,54 billion) to £375 billion (US$581,55 billion). Will these measures
be enough to prevent the feared double dip recession?
July 13, 2012 in Opinion
THE Minister of Youth Development, Indeginisation and Economic Empowerment,
Saviour Kasukuwere, continues his determined pursuit to destroy Zimbabwe’s
He does so with absolute disregard for irrefutable facts and authoritative
advice he has been given. He is fixated that policies he conceived prior to
his ministerial appointment are incontrovertibly correct and immutable. He
is convinced that the policies must be rigidly implemented without
modification or variation, and that any criticism of the policies is
malicious, baseless and racialistic.
For more than a century, untenable racial discrimination prevailed in the
economy, and that radical transformation was needed to accord most
Zimbabweans the opportunity to be economically empowered. However, no one
can credibly contend that such discriminatory practices should be eliminated
and reversed by pursuit of alternative discriminatory practices against
those whose ancestors were guilty of such practices in the past.
This creates not only reverse forms of discrimination, but also alienates
critical international investment, acquisition of state-of-the-art
technology, access to essential funding and to substantial foreign markets.
By myopically implementing racial policies as those applied in the
pre-Independence era, meaningful economic empowerment of the majority of
Zimbabweans has not only been minuscule, but poverty has been intensified
and the country’s economic recovery further retarded.
The devastation of the economy created by government in general, and by
Kasukuwere in particular, since the enactment of the indigenisation
legislation by parliament in 2007, but only belatedly receiving presidential
assent in March 2008, has been immense. Most foreign investment, attendant
technology transfer and access to international markets ceased, unemployment
increased and economic development receded. However, such masochistic
consequences have not satisfied Kasukuwere. On June 29 he prescribed yet
further economic destruction.
Spuriously alleging authority to do so by citing Section 5(4) of the
Indigenisation and Economic Empowerment (General) Regulations; 2010,
Kasukuwere initiated the gazetting of “prescribed” regulations in respect of
the finance, tourism, education and sport, arts, entertainment and culture,
engineering and construction, energy, services, telecommunications,
transport and motor industry sectors. The regulations sought to prescribe
the minimum net asset values above which the relevant businesses would be
required to comply with the principal regulations contained in the
Indigenisation and Economic Empowerment Act, the minimum percentage
shareholdings in such businesses that must be vested in indigenous
shareholders, and the maximum period of time within which the indigenisation
of such investments must be implemented.
In so prescribing, Kasukuwere had no qualms at interpreting the powers
vested in him by the legislation with contemptuous disregard for the
realities of such powers and their limitations. There was no consideration
of the negative consequences to the economy and therefore, to the well-being
of Zimbabweans, that would be inevitable. Many experienced and highly
qualified legal practitioners have already stated convincingly that the
minister has availed himself of powers with which he is not vested by
parliament and the indigenisation legislation, and has irrefutably acted in
breach of the constitution.
The consequential damage is immense. The financial sector in general, and
the banking sector in particular, have been weakened for more than four
years. The sector was emasculated in 2008 when Zimbabwe experienced the
greatest hyperinflation ever. Almost all banks became highly
undercapitalised, depositors were recurrently unable to effect timeous
withdrawal of their funds, and public confidence in the banks was so
dissipated that businesses in general and the populace at large lost
confidence in them. The consequential lack of deposits further eroded the
stability and efficacy of the banks, with several being liquidated and
others placed under curatorship (albeit the ills of some of the banks were
exacerbated and intensified by gross mismanagement).
Recovery of the banking sector is a prerequisite for significant recovery of
Zimbabwe’s troubled economy, over and above numerous other developments.
Foremost in achieving the sector’s recovery are:
Recapitalisation of several under-capitalised banks which necessitates
major investment. However, most of the indigenous population does not have
sufficient resources to effect such investment, let alone the will to do so.
But Kasukuwere’s determination to vest absolute control of the institutions
in the hands of the indigenous, thereby depriving investors of any
meaningful control and authority over their investments, is an
insurmountable deterrent to obtaining the investment.
Considerable international lines of credit and loans. But no financiers
will grant such facilities to institutions in circumstances that ownership
and control will change, the identity, credit-worthiness, good governance
capabilities and policies of the new controlling shareholders being wholly
unknown, and such future shareholders having little or no knowledge of
banking sector operations.
Customer confidence in banks, and therefore the services of the banks
being fully used by commerce and industry and other economic sectors.
Without such confidence, few are willing to deposit their funds in the banks
considering their wallsafes, mattresses, back pockets and handbags as more
secure havens for their hard-earned monies. Absence of such deposits
severely restricts the extent to which banks can operate.(These investors’
concerns have been markedly emphasised and strengthened by the number of
Zimbabwean banks and other financial institutions that have irredeemably
collapsed, with immense losses for depositors).
The other sectors addressed in Kasukuwere’s regulations are similarly
negatively impacted upon by those regulations, and hence the struggling
economy will be further weakened. As serious as the economic consequences of
Gukurahundi in 1985 were, so too are the foolhardy regulations of
Kasukuwere, compounding the economic harm created by previous policies.
July 13, 2012 in Opinion
THE ministry responsible for the indigenisation exercise, launced in 2007 by
the then Zanu PF government, two weeks ago published another set of
regulations that would, if implemented, have effectively nationalised all
firms in the country. The new regulations give companies a year to comply
and sets out penalties for non-compliance. Included in the new sweeping
attempt at indigenisation are the 100 or so private schools in the country.
In some quarters there was instant panic, but what was generally impressive
is very few seemed to take the action seriously. A headmaster of a private
school claimed he had not even heard about it and had not been contacted by
anxious parents or board members. However, eTV of South Africa took it
seriously, running a detailed clip on its main news covering the new
regulations and the threats they posed. Just what is the real position on
this new thrust to the controversial empowerment drive by Zanu PF elements
in the unity government?
First we need to understand the origins of this indigenisation drive. In
2007, the Zanu PF government came to parliament with the new Act. At the
time the MDC held a minority position in parliament and vigorously opposed
the legislation. After a lengthy, bruising fight the MDC withdrew before the
vote, knowing that had it stayed it would simply have been out voted. The
party chose to make a firm statement that this new legislation did not have
its support in any way.
The implementation of the Act was however overtaken by subsequent events —
the signing of the Kariba agreement in September 2007, the subsequent
electoral reforms and then the 2008 elections in which Zanu was defeated,
but was able to manipulate the result and prevent total transfer of power.
Instead in February 2009 Zanu PF found itself in a Government of National
Unity (GNU) with the MDC formations in which it has been forced to share
power for the first time since 1980.
It is important for people to understand the nature of this GNU
arrangement — it left President Robert Mugabe (even though he was defeated
in the elections) as head of state, chairman of cabinet and the Commander of
the armed forces. But what many do not appreciate is the new cabinet was
obliged to make all decisions on a consensual basis: the MDC held a majority
in cabinet but could not use its majority by voting on issues pending
cabinet decision. This has been a recipe for deadlock and has now reached a
point where government is almost paralysed.
In this arrangement, the Prime Minister (Morgan Tsvangirai) is in charge of
running government and all ministers, irrespective of their party
affiliation, are required to report to him. He is responsible for government
policy implementation and has complete power in this respect. This means
that any major new legislation or regulations must go through the cabinet
system first, before being implemented under the supervision and direction
of the prime minister.
The attempt by Zanu PF to circumvent this system to implement the
Indigenisation Act of 2007 can only be carried out lawfully with support of
government. Once the regulations giving the Act force and effect are passed
through cabinet, where they would require the support of MDC formations,
they would then come into use supervised overall by Tsvangirai, under whose
direction the line minister, Saviour Kasukuwere, would be required to
The reality is that the regulations first published in December 2010, again
last year and now this month have never been through the cabinet system —
they did not go to the cabinet committee on new legislation and were not
given cabinet authority and approval. In addition, the Parliamentary Legal
Committee has ruled that the new regulations violate elements of the
constitution and are therefore illegal.
Tsvangirai’s first response to this development in 2011 was to say the
regulations are not legally binding and therefore have no force or effect.
However, Zanu PF has been trying to force compliance. Indigenisation
minister Kasukuwere has been saying he is the minister responsible for the
Act, he has the right to implement it and the regulations, despite their
illegality, were binding.
It is now two years since this roadshow was launched. Its objectives are
clear; like the so- called “land reform” exercise it has nothing to do with
reform in any sense. It is a political platform for a phantom election. Its
secondary purpose is to derail economic recovery by discouraging foreign
investment and encouraging capital flight. Failing to recognise the much
diminished power and authority of Zanu PF in the GNU, the private sector has
reacted as if the game has not changed; investment has dried up, the stock
market has collapsed to low levels and local capital is fleeing the country
in significant quantities. The recovery of the economy is stalled; wages are
stagnant while Zanu PF blames the MDC for the problems.
This drive to halt recovery is seen in several other areas: failure to get
the National Railways of Zimbabwe back on the rails, attempts to block the
Essar and Green Fuel deals and the total collapse of Air Zimbabwe are all
deliberate Zanu PF ploys.
But what of the indigenisation circus? The recently published regulations
really do expose Kasukuwere for the clown he is. The regulations are clearly
illegal, violate the constitution and have not gone through the required
procedure to become law. Tsvangirai simply advised the target groups to
ignore the regulations and Kasukuwere, and carry on as normal. The reality
is that despite all the rhetoric, not a single firm has been indigenised
since 2010. One of the main targets, the mining industry, has said the
state — or anyone else — can have 51% of all mines tomorrow. They would be
delighted to get US$7 billion in cash and then have the new partners
(whoever they are) fund 51% of all new developments, or see their equity
stake diminished rapidly. It is all nonsense; we do not have the expertise
and technology to run these firms and we certainly do not have the money
after Zanu PF wiped out all savings and reserves of any kind in the decade
up to 2008.
In addition to the debacle that this represents, it is not even going to
help Zanu PF in any election that comes in the next 12-18 months. The people
know Zanu PF promises are just that; empty promises that mean nothing to
them as individuals, families or communities. Zanu PF promised land but all
we have left are derelict farms, no jobs and imported food at high prices.
Now the party promises us shares for nothing: they are trying to deceive us
again and we would be fools to be taken for a ride again, and watch what is
left of our broken economy go down the tubes.
Eddie Cross is MDC-T MP for Bulawayo South.
July 13, 2012 in Opinion
RECENT newspaper headlines screamed that the Sadc facilitation team headed
by South African President Jacob Zuma was on its way to Zimbabwe, with some
even suggesting Zuma would finally break the so-called impasse the media
claims exists between parties in the Government of National Unity (GNU).
There was clearly too much expectation, but it has turned out Zuma is a busy
man. His troubled ANC party was recently hosting its policy conference at
Gallagher Estates in Midrand ahead of the much-anticipated congress in
Mangaung in December this year.
The congress is a make-or-break affair for Zuma who is seeking re-election,
with the serious contender being his deputy-president Kgalema Motlanthe
backed by the ANC Youth League.
So to expect much from Zuma was wishful because given the internal dynamics
rocking the ANC, the man has too much on his plate. Lest we forget, former
President Thabo Mbeki was recalled just days after he thought he was a hero
for brokering a unity deal among Zimbabwe’s political parties.
During his term of office, Zuma spent much effort on Zimbabwe to deal with
the country’s crisis. Maybe his frequent absence from South Africa gave his
rivals the chance to plot and conspire against him. Zuma is now much aware
that he has to put his house in order first, rather than spend valuable time
dealing with the unending Zimbabwean impasse and unreliable politicians.
After all charity begins at home.
At a Quill Speak discussion at the Quill Club in Harare last Friday, MDC
secretary general Priscilla Misihairabwi told journalists it’s high time we
solved our issues as Zimbabweans rather than place all our hopes on Zuma and
his team. We are now tired of unending Sadc summits, Troika meetings and
frequent visits by the facilitation team which hasn’t registered much in the
way of tangible results despite ultimatums and timelines. Zimbabweans are
now tired of this script which has not changed much since the GNU was
formed. Zuma’s team can make as many trips as it wants to Harare, but if
there’s no will from the political leaders in Zimbabwe, nothing much will
The parties in the GNU are now just buying time, which is why in fact no
real impasse exists between them. Those who are talking of an impasse are
lost. These are mere side-tracks. The GNU parties have seemingly found each
other; surely if there was an impasse we would not expect people like deputy
Mines minister Gift Chimanikire (MDC-T) to say there is no anomaly in the
army owning a diamond mining company. Even more shocking were remarks by
co-Minister of Home Affairs Theresa Makone (MDC-T), who said Zanu PF
supporter, Police Commissioner-General Augustine Chihuri’s appointment was
legal. Who is really fooling who here?
No matter how many times the facilitation team come here, nothing will
change as long as Zimbabweans are not committed to dealing with issues on
their own. The facilitation team has helped draw up implementation plans
despite the Global Political Agreement being an implementation plan in
itself. The solution is in the hands of the political players; Zuma’s role
is to listen and advise. He has not proved to be a top decision-maker, and
we Zimbabweans are the custodians of this country and we should seriously
think about that. It now seems Zimbabwe is another province of South Africa,
mainly because we have given Zuma too much mandate to prescribe the course
for this country.
We should also be wary of South Africa dictating the pace for us. It’s like
a man who is having sexual problems with his wife going to call a neighbour
to mediate when the neighbour always looks at the wife with a lustful eye.
South Africa has many interests in this country, ranging from mineral claims
and other business interests, and is in fact Zimbabwe’s largest trading
partner. It has thus benefitted from the country’s economic meltdown, as
proven by the wide range of South African products in our shops, and the
number of Zimbabweans flocking to South Africa to buy goods for resale at
Also of concern is that the constitution-making process has dragged on much
longer than planned, with no end in sight. Zimbabweans must now demand a
conclusion to all this GPA madness. It is not only about the three parties
in government, but the millions of Zimbabweans who yearn to see a
progressive nation they can be proud of. — Vuvuzela Times.
Blessing Vava is a blogger from Chipinge.
July 6, 2012 in News
SOME 50 years ago, observing the trial of Nazi war criminals, the
German-American journalist Hannah Arendt coined the enduring phrase “the
banality of evil”. At a time when Justice minister Patrick Chinamasa, for
the benefit of the UN Human Rights Commissioner Navi Pillay, has tried to
apply lipstick to the toad of Zimbabwe’s human rights record and army
generals have suggested that the security forces are preparing to redeploy
the tactics utilised during the bloody 2008 elections, that phrase rings
true for us today.
Throughout the 2008 election period, the Zimbabwe Association of Doctors for
Human Rights (ZADHR) produced a series of reports documenting the atrocities
which were taking place. To ensure their credibility, these reports were
restricted to verifiable information which detailed the injuries sustained
by the victims of the violence.
As one of those involved in interviewing the victims, I was acutely aware
that many of the harrowing stories behind those injuries were never
published. However, with the looming spectre of a return to orchestrated
violence in the coming elections, I would like to recount my experience of
In April of 2008, as a member of the executive committee of ZADHR, I was
tasked with interviewing hospitalised victims of political violence. Over a
period of several days, I interviewed 52 men and women, ranging in age from
18 to 68 years. All of them resided in communal areas and most were ordinary
villagers. They were not political activists and none admitted membership of
a political party. Their only apparent crime was to have been suspected of
voting “incorrectly”. The vast majority stated they had been beaten by gangs
of youths led and directed by men in army uniforms and war veterans.
It is not possible to recount their individual stories here, but one story
stands out in my memory and will serve to illustrate the point I wish to
make. It was that of an 18-year old lad whose village was visited by a
militia at night which ordered all the young men to gather. They then
conducted a pungwe and at around midnight, the leader of the militia
announced they were all to proceed to the next village where they were to
beat up the occupants whom he said were “sell-outs”. The boy refused to
participate saying he had known them all his life and some of them were his
friends. So the thugs beat him up instead. He was hospitalised with a
fractured arm and leg and had contusions and bruises over his buttocks and
back. His spirit, however, was very much intact and he was bristling with
defiance. I was left in no doubt, that given the choice, he would make the
same courageous decision again.
The purpose of the methodical campaign of brutality was not to punish, but
to instil fear sufficient enough to ensure they voted “correctly” in the
run-off election. But therein lies the rub. As in the case of the brave
village lad, none of the 52 people I interviewed manifested any sign of
fear. They were stoic and defiant. The one emotion they had in common was
anger; a deep and abiding anger at the affront to their human dignity.
Those contemplating a return to the tactics of 2008 should not underestimate
the dignity, resilience and courage of ordinary Zimbabweans.
And finally, they should draw lessons from history, recent and past,
remembering the eventual fate of the once smug, arrogant men who Arendt
observed in that courtroom 50 years ago.
Dr Greg Powell,