The ZIMBABWE Situation Our thoughts and prayers are with Zimbabwe
- may peace, truth and justice prevail.

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From BBC News, 10 July

Eyewitness: Zimbabwe in turmoil

By Fergal Keane

We travelled into Zimbabwe posing as tourists. It isn't how the BBC would wish to operate but the restrictions imposed by the government make normal journalistic operations impossible. The BBC team travelled for hundreds of miles inside the country and we found evidence of the terror and repression imposed by the ruling party and its supporters. Since the presidential election, Zimbabwe has dropped far down the world agenda, overtaken by events in the Middle East and financial scandals in the United States. But the situation in the southern African nation has deteriorated steadily since Mr Mugabe's disputed victory. Human rights workers we met in Harare described escalating oppression and a situation where the rule of law is disappearing. At a safe location in the city we met three recent victims of torture: two were student activists and the other a farm labourer. The labourer had been asleep at home some weeks ago when youth militia from the governing Zanu PF party knocked on the door. He was told to get dressed and attend a night rally in support of the ruling party. "When I failed to come quickly enough they began to beat me," he said. "They smashed my teeth and then they dragged me outside. I was beaten on the ground and I thought my life was ending." The man suffered serious stomach and facial injuries. The gang leader also attempted to rape his wife. All of this happened in front of the couple's young children.

It is a story being repeated across the country. At a camp for displaced persons in the bush we met survivors of a militia attack in which hundreds of Zanu PF supporters had arrived on a farm and driven the workers out. With nowhere to go, they are now depending on the handouts of local aid agencies. One young mother told me that during the attack she had become separated from her husband and child. She was seized by the gang and was repeatedly raped by seven militia members. "I fainted and when I woke up I didn't know where my child was," she said. Driving across the country, we found fields in which crops withered or which lay untilled because of Mr Mugabe's onslaught against white farms. Farmers are selling off their herds of cattle believing that they risk losing them to Mr Mugabe's supporters. All of this in a country where 6 million people are facing the threat of starvation. The white farming community has been given one month to get off the land and as we drove, we became familiar with the sight of removal vans moving along the roads to South Africa. Near the town of Karoi we met farmer Chris Shepard who is resisting attempts to drive him off the land. Mr Shepard is a fourth generation Zimbabwean who is married with four young children. "I have nowhere else to go," he said. "I worked hard for everything I have and now somebody is going to take it away from me for no good reason."

The man many Zimbabweans look to for leadership in this crisis is Morgan Tsvangirai, leader of the main opposition party, the Movement for Democratic Change. However there is a growing sense among many activists that the MDC has failed to rally effectively after the party's defeat in the disputed presidential elections last March. We met Mr Tsvangirai at his heavily guarded Harare home, evading the security police who maintain round-the-clock surveillance. The opposition leader seemed hesitant about leading mass protests and said he worried that public anger would erupt spontaneously. "Some of us are now being regarded as conservative for urging restraint," he said. Mr Tsvangirai added that he believed real freedom would come to Zimbabwe but he did not say when. For those suffering hunger and terror, it cannot come soon enough.

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Comment from ZWNEWS, 11 July

The parrot cry

By Michael Hartnack

Robert Mugabe’s regime and the state-run media keep parroting a new, favourite phrase: ``lawfully elected government’’ – as if hearing it often enough will make voters accept the legitimacy of the March 9-11 presidential elections and the June 2000 parliamentary polls. Everything bad that happens now – and almost everything is bad – is called an attempt to overthrow or to undermine this "lawfully elected government." Thus the state-owned Herald, acting at the behest of Information Minister Jonathan Moyo, recently sought to identify and pillory those who met Tony Leon, leader of South Africa’s Democratic Alliance party and an outspoken critic of Mugabe’s regime. The Herald - clearly fed with information from the secret police - listed (incorrectly) those who attended a private dinner with Leon during his two-day visit. (The one redeeming feature of the police state Zimbabweans live under is its sheer technical incompetence). Heads of diplomatic missions, including the German and US ambassadors, and the British High Commissioner, were outraged to receive calls from the Herald demanding confirmation they were among the 16 at the dinner, supposedly plotting some dire mischief against Mugabe's "lawfully elected government."

All of us striving to keep civil society functioning, each in our different way, are too well aware the authorities would like to keep us under constant, malevolent surveillance - our phone calls tapped, our e-mails and faxes intercepted. Reminding us of that was a calculated act of intimidation. The link between Moyo's propaganda apparatus and the security establishment was further underlined when the police issued a statement bearing hallmarks of Moyo authorship. It claimed that shortages of maize meal, sugar and cooking oil "began to worsen after the presidential election." "It is believed the underlying cause is economic sabotage maliciously intended to discredit the lawfully elected government of Zimbabwe," it added. "The artificial shortages in the minds of the detractors would ferment (sic) or agitate the masses to engage in looting and defiance of law. The unimaginable dream theory would lead to an ungovernable state or anarchy, which would lead to the overthrow of the government."

Dropping all pretence of police being outside party politics, the statement claimed Morgan Tsvangirai's Movement for Democratic Change had "orchestrated artificial shortages,’’ and urged Mugabe to embark on a wholesale programme of nationalisation. "Police recommended that the government make concerted efforts on total control of the production and distribution systems of all basic commodities … (they) urged the government to ensure key positions in parastatals and board membership were offered to patriotic Zimbabweans who have the nation at heart." This came from a force whose commissioner, Augustine Chihuri, declared he would not recognise a victory by Tsvangirai in the presidential elections. In the past two years, police have repeatedly been shown to be in collusion with perpetrators of the worst human rights abuses.

Professor Tony Hawkins of the University of Zimbabwe said the threat to seize enterprises should be taken seriously. "It is unthinkable, but what is happening in agriculture is also unthinkable," he said. "The threat to seize companies is pregnant with disaster, in that whatever the government has taken over has never worked again." National Foods, 34 percent owned by Anglo Zimbabwe (a subsidiary of Anglo American) has scorned Mugabe's claim the company is manipulating shortages at the behest of Anglo chief Nicky Oppenheimer. Far from hoarding or hiding salt, National Foods imported fresh supplies and notified the authorities while trying to negotiate a realistic price, to cover the "parallel" rate (US1 = Z$300), naturally demanded by the Botswana suppliers. Before the salt could be put on the market, ruling Zanu PF party bully boys turned up and claimed to have "discovered" the consignment. Obviously, no more salt will now be imported and shortages will worsen.

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Zimbabwe Arrests US Tourist for Mugabe Home Photos
July 11
— HARARE (Reuters) - Zimbabwe arrested and charged a U.S. citizen for taking photographs of President Robert Mugabe's official residence in Harare, police said on Thursday.
Carol Dean Howard and a Zimbabwean woman tourist were picked up outside State House on Sunday and detained overnight on charges of contravening security laws on the protection of specified state properties, they said.
"The two were released on Monday after being formally charged," police spokesman Inspector Andrew Phiri said.
"State House is not a tourist facility and it is not even near any tourist facility, and under our laws, it is an offence to go out there to take pictures," he said.
Inspector Phiri said police were continuing to investigate the charges, a conviction for which is punishable by a fine or a two-year jail sentence.
U.S. embassy officials were not immediately available for comment. Howard and her Zimbabwean colleague's whereabouts were not clear on Thursday.
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      Govt fails to pay diplomats abroad

      By Sydney Masamvu Political Editor
      7/11/02 9:23:44 AM (GMT +2)

      THE government, hit hard by a foreign currency crisis, has failed to
pay most of its diplomats abroad in the past three months and is downsizing
staffing levels there.
      Official sources this week said the government had been erratic in
paying the salaries of the diplomats in the past three months because it was
using the little foreign currency it had to import fuel and electricity.

      Some diplomats are now said to be finding it extremely difficult to
meet personal expenses and their spouses have had to engage in part-time
work, violating diplomatic protocols.

      Spouses of diplomats are not allowed to work because their upkeep is
covered by a monthly stipend provided by the state.

      Willard Chiwewe, the permanent secretary in the foreign ministry,
acknowledged yesterday that severe difficulties were being experienced in
paying Zimbabwean diplomats because of the foreign currency squeeze.

      "We pay them as and when the funds are available," he told the
Financial Gazette.

      "We however admire their ability to cope in instances where their
re-imbursements are delayed," he said.

      The failure to pay the diplomats on time is only the latest sign of
the widening havoc being written by the foreign currency woes, which began
in 1999 because of poor exports and the drying up of foreign sources of
balance of payments aid.

      The government is also unable to service its burgeoning foreign debt
as it grapples with the worst economic crisis, which has been highlighted by
record high inflation, unemployment, poverty and a tumbling local dollar.

      Zimbabwe, which has 37 missions abroad, needs US$200 million a month
to meet commitments such as energy and power imports and payments of foreign

      According to central bank figures, Zimbabwe's hard cash earnings have
averaged less than US$30 million a month since the start of the year, which
translates to less than a week's cover of imports.

      Official sources say that in the face of the deepening crisis, the
government is giving priority to the payment of electricity and fuel bills
and the importation of food to feed half the population threatened with

      It is also recalling some officers from missions abroad whom it
redeploys on various desks at the Ministry of Foreign Affairs in Harare.

      The recalled officers do not have specific duties assigned to them,
the sources said, noting that some of these officers had opted to retire.

      New foreign postings have been frozen while staff at non-critical
missions are being re-deployed to missions deemed of high priority.

      The need to review the operations and staffing levels of foreign
missions has apparently been triggered by a travel ban slapped on President
Robert Mugabe and members of his Cabinet by the West earlier this year.

      The sources said Zimbabwe's ambassadors in European missions had
become increasingly isolated as result of the ban by the European Union and
the United States, which do not recognise Mugabe's controversial re-election
in March.
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      Tsvangirai's petiton surety set at $2m

      Staff Reporter
      7/11/02 9:27:18 AM (GMT +2)

      THE High Court yesterday increased to $2 million the surety to be paid
by opposition leader Morgan Tsvangirai in his election petition challenging
President Robert Mugabe's victory in the disputed March presidential

      Justice Anne-Mary Gowora ruled that the $500 000 surety Tsvangirai had
offered was insufficient and therefore should be raised to $2 million.

      She said Tsvangirai, leader of the Movement for Democratic Change,
should deposit a deed of surety with the Registrar of the High Court within
10 days from yesterday after which his petition could be heard.

      The Electoral Act, under which Tsvangirai is petitioning the High
Court to overturn the result of the March election, requires the petitioner
to provide upfront surety to cover the legal costs of the respondents in the
event that they lose the case.

      Yesterday's ruling followed an application to increase the surety
filed by Mugabe, who argued through his lawyer Terrence Hussein that the
amount tendered as security by Tsvangirai was not enough to cover the legal
costs of the respondents.

      Tsvangirai's petition cites Mugabe as the first respondent,
Registrar-General Tobaiwa Mudede as the second, Justice Minister Patrick
Chinamasa as the third and the Electoral Supervisory Commission as the

      Four people-Welshman Ncube, Paul Themba Nyathi, Simbarashe Muzenda and
Murisi Zwizwani-signed as surety in Tsvangirai's petition filed in April
this year.

      The High Court rejected Mugabe's request that the $2 million surety be
deposited with the court, saying it was sufficient for Tsvangirai to deposit
a deed of surety with the Registrar of the High Court.

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      Zim renegotiates Libyan fuel deal

      Staff Reporter
      7/11/02 9:25:39 AM (GMT +2)

      ZIMBABWE is renegotiating a US$360 million Libyan fuel deal which
expires at the end of this month, it was learnt this week, as reports
emerged that the North Africans have intensified their claim on key
Zimbabwean economic sectors.

      Oil industry sources said Mines and Energy Minister Edward
Chindori-Chininga was in Libya two weeks ago to renegotiate the fuel deal
brokered last year by President Robert Mugabe and Libyan leader Muammar

      No comment was available from Chindori-Chininga this week but the
sources said the Libyans were keen on extending the facility but wanted
greater participation in the key oil and tourism sectors.

      "We have approached the Libyans on the possibility of renewing the
deal and what now remains is agreement on the terms and conditions of the
renewal," a senior oil industry official said.

      The Zimbabwean delegation also included Commercial Bank of Zimbabwe
(CBZ) managing director Gideon Gono and senior National Oil Company of
Zimbabwe (NOCZIM) officials.

      CBZ spokesman Sunsleey Chamunorwa confirmed that Gono was part of the
delegation which went to Libya a fortnight ago but could not shed any light
on the outcome of the negotiations.

      The CBZ is the financial adviser to NOCZIM which it has helped in the
past two years to raise funds to import fuel.

      Under the deal, Libya provided fuel to Zimbabwe in exchange for local
products and shareholding in state-run companies.

      The US$360 million was released in quarterly tranches of US$90 million
and Harare agreed to finance the fuel purchases through exports to Libya of
local products.

      Zimbabwe requires about US$40 million a month to import fuel.

      The sources said at least three separate delegations of Libyan
businesspeople had visited Zimbabwe in the past month to explore business

      "One group is expected in the country this week to assess investment
opportunities in the oil industry while another one was here about three
weeks ago on a mission to actualise a beef deal between the two countries,"
one source said.

      Zimbabwe is expected to export 12 000 tonnes of beef to Libya under an
agreement reached last year but is still to be implemented due to logistical
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      Parallel market a necessary evil: IMF

      Staff Reporter
      7/11/02 9:25:03 AM (GMT +2)

      THE International Monetary Fund (IMF) says Zimbabwe's thriving
parallel currency market must be tolerated in the absence of concrete
government measures to stabilise the local dollar.

      The IMF's stance became known as it emerged this week that at least 80
percent of Zimbabwe's hard cash trade is transacted in the unofficial

      The Fund, which has severed ties with the government over its poor
economic policies, has told the Harare authorities that the three-year-old
parallel market is unavoidable as long as the Zimbabwe dollar remains

      "The parallel market should be tolerated in the absence of devaluation
because it facilitates trade and other foreign currency transactions,"
according to a country report on Zimbabwe released by the Bretton Woods
institution last week.

      Zimbabwe, in the midst of its worst economic crisis since independence
from Britain in 1980, has seen supplies of foreign currency dry up since the
end of 1999 on the back of strained relations between Harare and the IMF.

      A thriving parallel market has developed since then, starving the
official market of hard cash required to import food, power and energy as
well as essential raw materials.

      The US greenback is trading at around 600 Zimbabwe dollars on the
parallel market compared to the official exchange rate of 55 Zimbabwe
dollars to one US dollar.

      Analysts this week said the parallel market now handled more than 80
percent of the country's hard cash earnings, with the remainder going
through the official market.

      "A sizeable chunk of the trade on the parallel market is conducted
through bureaux de change and commercial banks while the rest are
transactions among individuals without facilitation by banks and bureaux de
change," a currency trader said.

      No comment was available from the Reserve Bank of Zimbabwe or the
Zimbabwe Association of Bureaux de Change.

      Economist Witness Chinyama said the parallel market, which is
threatening to cut short Finance Minister Simba Makoni stint as head of
Zimbabwe's Treasury, was being driven by skewed expectations about the value
of the local currency that had resulted in a shift towards consumption.

      The bulk of the hard cash was in private hands and individuals and
firms were only waiting for the introduction of a realistic exchange rate,
he said.

      "The thriving parallel market does not mean that Zimbabwe has no forex
but is an indication that the Reserve Bank is not paying the right price to
entice those with the money to sell through the official channels," Chinyama

      Questions have been raised over the influx of flashy imported vehicles
and the construction of upmarket properties at a time Zimbabwe is facing the
hard cash crisis.

      Zimbabwe has one of the largest fleet of imported cars in Africa, with
some vehicle models hitting the streets of Harare within days of their
launch in Japan or Europe.

      "This is all a sign that the country has turned into a consumption
economy and is also an indication of asset price inflation where people are
trying to hedge against the instability of the Zimbabwe dollar by buying
certain assets which they either keep or sell at a profit," Chinyama said.

      Nyasha Chasakara, an analyst with First Mutual Asset Management,
added: "The official exchange rate has benefited individuals and some
companies with access to foreign currency who have been importing new
vehicles and other assets."
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      RBZ widens forex probe

      Staff Reporter
      7/11/02 9:23:02 AM (GMT +2)

      ZIMBABWE'S central bank has widened its probe into illegal foreign
currency deals in the financial sector by targeting Bard Stockbrokers over
what it suspects to be shady transactions involving the externalisation of
proceeds from the transfer of Old Mutual shares, it has been learnt.

      Banking industry sources this week said officials from the RBZ last
Thursday visited Bard offices in Harare as the probe into the alleged
externalization of hard cash earned through the sale of two million Old
Mutual shares widened.

      They said the Zimbabwe Stock Exchange (ZSE) also wrote to the
stockbroking firm last week requesting information on the transactions.

      Another stockbroking firm, Continental Securities, is also being
investigated for similar transactions.

      Bard is the stockbroking arm of the African Banking Corporation (ABC)
Holdings while Continental Securities is owned by NMB Bank.

      The allegations against Bard are that they have transferred Old Mutual
shares from the ZSE register to Johannesburg but the proceeds were deposited
elsewhere, therefore prejudicing the country of much-needed hard cash.

      It is understood the central bank probe wants to establish whether ABC
were the holders of the shares being investigated and whether the regional
banking group had facilitated the transactions.

      However Bard managing director Michael van Flake yesterday denied that
the RBZ had written to his group, although he admitted that the ZSE had
asked Bard to furnish it with details of the transactions.

      "We received some communication at the end of last week from the ZSE
but it is a normal procedure," van Blake told the Financial Gazette.

      "There is no investigation by the RBZ and we have not received any
communication or a visit in this regard from the RBZ. There is no
contravention of any regulations pertaining to the transactions," he said.

      ABC group's head of banking Francis Dzanya said the RBZ had not
written to them nor visited them.

      "I have not received any correspondence from the RBZ but if it was so
it would be a normal routine that they do from time to time."

      The probe follows the central bank's request last week to have the
privately-run NMB Bank Limited furnish it with details of transactions
involving another two million Old Mutual shares amid allegations that there
could have been illegal foreign currency dealings in the transactions.

      The sources said the two million shares brokered by Bard had been
transferred since the beginning of the year to Johannesburg. The RBZ alleges
that it could have lost 40 percent of the proceeds it was entitled to get in
the transactions.

      The central bank is entitled to 40 percent of all foreign currency
transactions, which the country desperately needs to finance fuel and
electricity and food imports.

      Stockbrokers yesterday said the ZSE had written to Bard last week and
were in the process of gathering information on the transactions. In fact,
it was after the ZSE had noted some alleged irregularities that they alerted
the RBZ, the sources said.

      "The ZSE has written to them (Bard) but I believe they are still
picking up information," one source said.

      If the allegations of impropriety are found to be true, Continental
Securities and Bard Stockbrokers could be suspended or deregistered from the
local bourse while the punishment for the two banks could be harsher.

      Ignatius Mabasa, the RBZ spokesman, this week said the central bank
only commented on general policy and not on issues pertaining to specific
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Shortage in Africa May Kill 300,000
Wed Jul 10, 1:42 PM ET
By ALEXANDER G. HIGGINS, Associated Press Writer

GENEVA (AP) - The United Nations said severe food shortages brought on by
two years of drought could kill as many as 300,000 people in Southern Africa
in the next half year.

"There is now a severe humanitarian crisis," said Dr. David Nabarro, a
senior official of the World Health Organization.

Earlier this month the United Nations asked for $507 million to buy food for
people in the hardest-hit region, which includes Malawi, Zambia, Lesotho,
Zimbabwe, Swaziland and Mozambique and is home to 60 million people. Of
those people, about 12 million will suffer food shortages in the coming

But food supplies are only part of the problem.

"We have to also address the urgent health-care needs of the population," he
said. Drinking water, medicine and vaccines are also needed, and WHO
officials expect soon to ask for $19 million to improve health care in the
hunger zone.

"Our calculations suggest that the crisis in this region could result in up
to 300,000 'excess deaths' during the next six months," he said. "This is a
conservative estimate."

The increased death toll would likely result mainly from diseases that
infect people whose resistance drops because they are malnourished, he said.

"We're seeing a continuing rise in tuberculosis and acute chest infections,"
Nabarro said.

Health workers have found increased mortality rates in all population
groups, he said. Women have begun showing an increased risk of dying as a
result of problems during pregnancy.

Nils Kastberg of UNICEF said many of those at risk are children under the
age of 5.


Telegraph [uk]
Aids 'could turn states into criminal havens'
By Isambard Wilkinson in Madrid
(Filed: 10/07/2002)

The relentless rate of HIV infection is in danger of reducing the countries
worst afflicted by Aids to war-torn havens for terrorists and criminals, the
International Aids Conference in Barcelona was told.

American and United Nations officials said the disease's progress was
threatening the existence of nation states in parts of sub-Saharan Africa.

Tommy Thompson, the US health secretary, said America had earmarked more
than $16 billion (£10 billion) a year to fight Aids.

He added: "We also realise fully that unless we do something, there are
countries that are going to be very unstable in the future because of the
decimation this terrible disease is going to raise.

"International terrorists will go wherever they can in order to flourish
their hatred and their convictions and assaults on humanity."

An estimated 20 million people have died of Aids.
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      Mzee in China for treatment

      By Sydney Masamvu Political Editor
      7/11/02 9:20:53 AM (GMT +2)

      VICE President Simon Muzenda, unwell for months, has flown to China to
receive specialist medical treatment for an undisclosed ailment, it was
established this week.
      Official sources told the Financial Gazette that Muzenda, Zimbabwe's
longest-serving deputy to President Robert Mugabe, had slipped out of the
country for China two weeks ago to seek medical treatment.

      The government is on record as saying Muzenda is not having any health

      An official at Muzenda's office confirmed this week that he was out of
Zimbabwe but could neither disclose his destination nor the nature and
purpose of his trip.

      The official said Muzenda, 80 in October this year and unwell in the
past four months, was expected back in Harare next week.

      Ruling ZANU PF party insiders said Mugabe, in a bid to consolidate his
stranglehold on power, had shot down a request by his ailing deputy to
retire from active politics.

      They said Muzenda, citing ill health, had informed Mugabe of his
intention to retire before the March presidential election but was told not
to go during what Mugabe then described as a critical phase of his 22-year

      Sources close to Muzenda said the vice president had raised the issue
again with Mugabe after the presidential vote, but that this had largely
been ignored.

      "It is an open secret within the party leadership that Vice President
Muzenda, because of health problems, has expressed his intention to retire
but this has been turned down by President Mugabe," a member of ZANU PF's
supreme Politburo with close ties to Muzenda said this week.

      The sources said Muzenda wanted to retire on medical grounds and did
not want to be included in a Cabinet line-up which had been expected to be
formed after Mugabe won the disputed presidential election.

      In the past four months, the vice president has been spending most of
his time convalescing at his rural home area of Zvavahera in Gutu and only
attending Cabinet's weekly meetings held on Tuesdays.

      Muzenda is the Member of Parliament for Gutu North constituency.

      During the presidential election, he kept a low profile because of ill
health and scaled down his public engagements even in the post-election

      Insiders say Mugabe wanted Muzenda to remain active to fend off
pressure from within and outside ZANU PF for the President to also retire.

      Mugabe, controversially re-elected in a vote rejected as flawed by the
international community, says he has not decided on when to quit because a
successor to take over has not yet been identified and groomed.

      He also says he wants to retire only after completing his agrarian
reforms, set to officially to end next month.

      Mugabe has always been reluctant to discuss the succession issue. He
also refused to allow Joshua Nkomo, the late vice president, to retire after
Nkomo had expressed his wish to do so.

      Nkomo died on the job in July 1999 after battling with prostate cancer
for more than a year.

      Zimbabwe's two vice presidents - the other is Joseph Msika - are on
record as saying they will retire at the same time with Mugabe when they
have completed the land reforms under which the government is seizing
white-owned farms to resettle blacks.

      The sources said Muzenda had preferred to go to China, and not Europe
or North America, because of the travel ban imposed earlier this year by the
15-nation European Union, the United States and Canada on Zimbabwe's
leaders, who are accused of promoting lawlessness. They deny the charge.
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Makoni Misses Budget Targets

Financial Gazette (Harare)

July 11, 2002
Posted to the web July 11, 2002

Staff Reporter

FINANCE Minister Simba Makoni has failed to deliver his 2002 promises to revive Zimbabwe's ailing economy and analysts warn that he is unlikely to do so in the five months now remaining before the end of the fiscal year ending in December.

Makoni, brought into the Cabinet after Zimbabwe's 2000 parliamentary elections, has missed several of the targets he set for 2002 as President Robert Mugabe maintains a tight grip on the country's financial levers.

The missed targets include pledges to accelerate the privatisation of state firms, to deliver effective and non-destructive land reforms, to stimulate the recovery of productive and export sectors as well as a promise to instill fiscal discipline within the administration.

Makoni had budgeted to raise more than $40 billion this year from the sale of about 17 public enterprises, but so far none of the targeted parastatals has been disposed of, with more than half the year gone.

The only progress made so far has been the short-listing of potential investors for TelOne, the unbundled telecommunications arm of the former Posts and Telecommunications Corporation.

Economic analysts this week warned that procrastination in the sell-off of state assets would worsen the government's cashflow crisis and feed into the bloated budget deficit problem, officially estimated at 14.9 percent of annual gross domestic product this year.

An analyst with Sagit Stockbrokers said the anticipated lower privatisation proceeds would create a huge void in the government's finances just when the tax base has shrunk and Zimbabwe needs cash to import food and meet its ballooning foreign debt arrears.

"The budget deficit is therefore likely to balloon because, although the privatisation proceeds were budgeted for, the government won't have enough money to pay for its requirements, especially the demand for food," the Sagit analyst said.

Zimbabwe is grappling with severe food shortages caused by drought and disruptions to farming by the ruling ZANU PF supporters.

The cash-strapped Harare authorities need to raise more than $44 billion this year to import grain.

Makoni budgeted to collect $251.9 billion revenue during the current fiscal and calendar year against anticipated expenditure of more than $390 billion.

Figures from the central Reserve Bank of Zimbabwe (RBZ) show that the Treasury collected $55.9 billion in the first three months of 2002, about $7 billion less than the quarterly average revenue for this year.

Makoni has come under fire in the past few weeks from some of his ZANU PF colleagues for failing to decisively act on a thriving parallel foreign exchange market and to restore confidence in the economy.

The politicians accuse him and RBZ governor Leonard Tsumba of fuelling speculation in the economy through ineffective policies they have pursued in the past two years.

But the analysts said Zimbabwe's unstable political environment and Mugabe himself were partly to blame for Makoni's failure to rescue the economy from collapse.

They said the continued silence by Mugabe on a new Cabinet and other policy inconsistencies since the 78-year-old leader was re-elected to a second term in March had worsened the uncertainties in the economy.

Mugabe began his second term on March 17 2002 and clocked his first 100 days in office at the end of last month.

"Implementation of all economic policies is dependent on political stability and one would have thought that after winning the election, they would have started implementing the policies they had put on hold," economist Witness Chinyama said.

Some of the policies expected to be affected by the hostile political climate include the proposal by Makoni to solicit private sector assistance in building infrastructure and the stimulation of the tourism sector through the introduction of tourism development zones.

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Theft, prostitution seen as famine grips Zimbabwe
11 July 2002 12:45
Theft, prostitution and child labour are some of the means hunger-stricken communities in Zimbabwe are using to cope with the effects of drought and food shortages, according to a recent United Nations report.

A humanitarian situation report published this week by the UN relief and recovery unit in Harare and the Famine Early Warning Systems Network (Fewsnet) cited a UN report which identified several 'coping mechanisms' that people are resorting to, to ensure personal survival.

"Stealing is one of the coping strategies by people in both rural and urban areas," said the report, adding that the thieves' main targets are grain and stock.

Hunger has also forced villagers to poach wild animals, particularly in newly resettled farms, while others take to prostitution.

"Prostitution has generally increased in urban areas and growth points (rural service centres)," said the report.

A drought, the worst in a decade in southern Africa, coupled with two years of controversial government-led land reforms have plunged Zimbabwe into an increasingly dire humanitarian situation, experts say.

Young children who should be going to school are forced to work either as traders or in illegal gold-panning activities in rivers to try to make ends meet for their families.

"Young children in both rural and urban areas are being used as part of the survival system. They are sent selling a variety of goods," said the report.

The report said some Zimbabweans have been "seeking relief from food insecurity and economic stress beyond their borders", with many leaving the country to do menial jobs in neighbouring countries or further afield.

"Remittances from relatives working outside the country form an important aspect of the survival strategies," it said.

An estimated 7,8-million people, including 5,4-million children are faced with hunger in Zimbabwe.

Kenzo Oshima, UN under-secretary general for humanitarian affairs, last month described Zimbabwe's food crisis as "very serious".

In April Mugabe declared a state of emergency, opening the doors for international aid to a country which has traditionally been a regional breadbasket.
Zimbabwe needs to import a total of 1,8-million tons of food to survive until the next harvest in 2003.

Six other African nations -- Angola, Lesotho, Malawi, Mozambique, Swaziland and Zambia -- face serious hunger problems because of combinations of bad weather, poor policy and conflict.

On July 1, the UN World Food Programme launched an appeal to provide emergency food to the affected southern African countries. Zimbabwe's needs comprise 45% of the total regional appeal. - AFP
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      Obasanjo upbeat after talks with Mugabe

            July 10 2002 at 08:44PM

      By Peter Fabricius and Basildon Peta

      Nigerian President Olusegun Obasanjo said he had been encouraged by a
meeting he had with Zimbabwean President Robert Mugabe to discuss the
faltering political reconciliation talks between the ruling Zanu-PF and the
opposition Movement for Democratic Change.

      However, MDC leader Morgan Tsvangirai remains pessimistic about the
chances of persuading Mugabe to back down in his clamp-down on opponents in

      "We are making progress. Maybe not as much as we would like," said
Obasanjo about his hour-long meeting with Mugabe which took place on the
fringes of the summit of the new African Union launched on Tuesday.

            The leaders had 'marginalised' Mugabe
      Obasanjo said at a press briefing that the meeting had taken place in
a better atmosphere than had existed since the Commonwealth troika met in
London earlier this year to suspend Zimbabwe from the organisation.

      Obasanjo, President Thabo Mbeki and Australian Prime Minister Howard
formed a troika to decide what to do with Zimbabwe after Commonwealth
observers determined that the March presidential elections were not free and

      Obasanjo said he had reported on the outcome of his meeting to United
Nations Secretary-General Kofi Annan who was as a result eager to meet

      Mugabe's spokesperson George Charamba said later that Mugabe had been
unable to meet Annan who had already left Durban for the Sudan but that the
two men would probably speak later.

      Tsvangirai said he would wait to get the details of the substantive
issues discussed between Obasanjo and Mugabe before making a firm comment.

      He said he was, however, pessimistic about the chances of Mugabe
reforming into a reasonable leader.

      The best option was for African leaders to exert pressure on the
ageing Zimbabwe leader to re-run the disputed March presidential election.

      Although they did not formally put Zimbabwe on the agenda of the
launch of the AU, Tsvangirai said it was good that the leaders had
"marginalised" Mugabe by not giving him any prominent role at the summit. -
Independent Foreign Service
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Daily News

      MDC's Mugomba accuses Herald of lying

      7/11/02 7:49:47 AM (GMT +2)

      By Luke Tamborinyoka Municipal Reporter

      DANIEL Mugomba, who was previously announced as the MDC candidate for
the Kadoma mayoral election, dismissed as "blue lies", yesterday's story in
the government mouthpiece, The Herald, alleging that he had castigated his

      Mugomba was speaking at the launch of the MDC mayoral campaign in
Kadoma yesterday.

      The MDC is now fielding former head teacher Edita Matamisa as its
candidate for the post, which fell vacant after the death in February of the
previous mayor, Ernest Shamuyarira.

      Matamisa's running for office was announced at the last minute, at the
nomination court, in what the MDC said was a strategy to save her from
victimisation by Zanu PF elements in the town.

      Mugomba, who gave a vote of thanks when Matamisa was introduced for
the first time to the electorate yesterday, denied ever giving an interview
to The Herald.

      "I am part of the campaign for Mrs Matamisa and I have never
      spoken to The Herald," he said.

      "It's all blue lies and the MDC will certainly win this election
despite these malicious allegations by The Herald."

      Mugomba pledged his full support for Matamisa, who was introduced to
about 100 people in the heart of Kadoma town yesterday. He accused the State
media of trying to make mileage out of "fictitious decisions" concerning the

      The Herald purportedly quoted Mugomba as expressing bitterness "at
having been left in the cold at the last minute".

      The newspaper alleged that Mugomba was disappointed that his party was
not doing anything to recover the goods he lost when his house was
petrol-bombed by alleged political rivals a fortnight ago. The paper claimed
that Mugomba's house was bombed by rivals within the MDC.

      But Mugomba yesterday said he had handed over a list of destroyed
property to the MDC's Election Directorate in Harare.

      "My party is working on the issue and I have faith that everything
will be sorted out, despite malicious allegations by the
government-controlled mouthpiece."

      Meanwhile, the MP for Kadoma Central, Austin Mupandawana, speaking at
the same launch, urged residents to turn up in their thousands and vote for

      He lashed out at the high rates, corrupt tender procedures, high water
bills, nepotism and corruption as negative factors characterising the Zanu
PF Kadoma civic administration.

      Matamisa will contest the elections against the acting mayor Fani
Phiri of Zanu PF. The elections are set for the weekend of 27 and 28 of

      The MDC will be holding rallies every day until the day of the
election at the last minute".

      The newspaper alleged that Mugomba was disappointed that his party was
not doing anything to recover the goods he lost when his house was
petrol-bombed by alleged political rivals a fortnight ago. The paper claimed
that Mugomba's house was bombed by rivals within the MDC.

      But Mugomba yesterday said he had handed over a list of the destroyed
property to the MDC's elections directorate in Harare.

      "My party is working on the issue and I have faith that everything
will be sorted out, despite malicious allegations by the
government-controlled mouthpiece." Meanwhile, the MP for Kadoma Central,
Austin Mupandawana, has urged residents to turn up in their thousands to
vote for Matamisa.
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Daily News

      Insurers meet to map out survival strategies

      7/11/02 7:49:02 AM (GMT +2)

      Chief Reporter

      THE 11 September 2001 bombing in the United States of America in which
thousands died and millions of dollars worth of property was lost, has
forced insurance companies to come up with new strategies for survival.

      In that context, 80 delegates from the Organisation of Eastern and
Southern Africa Insurers, (OESAI) will meet in Kariba between 22-27 July
under the theme Rethinking Insurance Strategies in Africa.

      Christopher Gomwe, the secretary-general of the organisation whose
members are from the Common Market for Eastern and Southern Africa, (Comesa)
said on Tuesday the US bombings had affected the industry "in a big way".

      Gomwe said: "The reinsurance premium increased because of the payments
made to both institutions and individuals following the bombings. These
increases had an impact on the public because some of the costs have been
passed on to them."

      He said OESAI members were keen to share ideas on how the industry had
been affected by the disaster.

      "The coming theme brings an awareness to all members to consider
seriously and come up with new strategies in order to maintain the survival
of the industry in a changing environment," said Gomwe.

      The objectives of OESAI, which has its headquarters in Harare are to
promote the exchange of insurance and reinsurance business among members,
and promote the exchange of ideas and views among members with regard to the
insurance underwriting practices in various markets.

      It also aims to develop regional insurance capacities in order to
reduce dependence on overseas markets and to harmonise the insurance law to
encourage the exchange of insurance business among member countries in the

      "To reduce dependence on external markets, the organisation
established, a Fire Pool in 1977. The Pool is open to all members of OESAI,
but only 27 members belong to the Fire Pool which has now been broadened to
accept all non-life business," Gomwe said.

      OESAI was formed in 1973 following the initiative of several insurance
companies in Comesa. It was mainly formed by companies in Kenya, Uganda,
Tanzania, Zambia and Mauritius.
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Zimbabwe resumes test trial of American journalist

HARARE, July 11 - In the first test of tough new media laws, a Zimbabwean
court is due to rule on Friday on whether to dismissed charges against an
American journalist charged with publishing falsehoods.
       Andrew Meldrum, a correspondent for Britain's Guardian newspaper, is
the first journalist to go on trial on charges of publishing falsehoods -- a
crime which carries a heavy fine or a two-year jail term.
       The government has charged 12 journalists with publishing falsehoods
since President Robert Mugabe passed new media laws after his controversial
re-election in March, rejected by both the opposition and key Western powers
as fraudulent.
       Meldrum and two other journalists are charged in connection with
reproducing a story first published in the privately-owned Daily News that
said Mugabe's supporters had beheaded a woman in a rural area earlier this
       The newspaper later said the story was false and apologised to
Mugabe's ruling ZANU-PF party.
       ''Naturally our hope is that the case should be dismissed, but if it
doesn't we are also ready to continue with the defence case and to argue
that the law is unjust and is being unfairly applied,'' Meldrum's lawyer
Beatrice Mtetwa said on Thursday.
       The Harare regional magistrate court adjourned the trial of Meldrum,
50, three weeks ago after state prosecutor Thabani Mpofu wrapped up his
       Mtetwa has asked the court to throw out the charge, saying the state
had built its case on an unjust law and had dismally failed to lay a solid
       Continuing the trial amounted to Zimbabwe imposing its laws on other
countries, as the story Meldrum is alleged to have written was published in
Britain, she said.

       Technically Meldrum -- who has pleaded not guilty -- had not
published the beheading story in Zimbabwe and that by picking stories off
the internet, Zimbabwe was extending its offending laws abroad, Mtetwa
       She also points out that Meldrum had correctly attributed that he had
picked up the story from a Zimbabwe newspaper.
       But the government says the tale was fabricated as part of a
Western-backed propaganda campaign to damage Mugabe's image and to advance
the interests of the main opposition Movement for Democratic Change (MDC).
       Mpofu has said the state had ''more than a prima facie case'' that
Meldrum was guilty of reproducing a false story, and it did not matter where
it was published or the circumstances.
       Meldrum has lived and worked in Zimbabwe for the last 21 years and he
now holds a permanent residency permit.
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U.S. accuses Zimbabwe of political use of food aid

WASHINGTON, July 11 - The United States on Thursday accused the Zimbabwean
authorities of withholding relief food from children in the Matabeleland
town of Binga for the past five weeks for political reasons.

       ''We call on the government of Zimbabwe to rectify this situation in
Binga at once and to ensure that food distribution is carried out on a
nonpartisan basis countrywide,'' said U.S. State Department spokeswoman Lynn
       Self-described ''war veterans,'' or vigilantes loyal to Zimbabwean
President Robert Mugabe, have prevented a Catholic charity, the Catholic
Commission for Justice and Peace, from distributing food in the Binga area,
she said.
       The district commissioner, the senior local government official,
supported the war veterans and the police had refused to intervene, she
       ''As a result of this blockade, children have fainted from hunger
during school hours. Others have become too weak to attend classes,'' Cassel
       ''The Catholic Commission for Justice and Peace at one point was even
blocked from providing food to 27 children hospitalized for malnutrition.''
       Zimbabwe is at the center of a devastating food shortage sweeping
across southern Africa.
       Cassel said the government of Zimbabwe bore much of the
responsibility for the humanitarian crisis but the United States would
continue to provide food assistance.
       Mugabe has disrupted Zimbabwe's agricultural system by driving mainly
white commercial farmers off their land before black small farmers are ready
to take over their operations.
       The world's biggest food agency said on Thursday it had warned Mugabe
not to ''politicize'' food distribution in Zimbabwe, where six million
people face starvation.
       James Morris, executive director of the U.N's World Food Programme,
said he had spoken several times with Mugabe and issued a stern warning.
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Top Zim Group Paints Gloomy Picture

Business Day (Johannesburg)

July 11, 2002
Posted to the web July 11, 2002

Dumisani Muleya

A LEADING Zimbabwean company painted a gloomy picture yesterday of the
economic situation, warning that "unless the political environment improves"
recovery would remain a mirage.

In its monthly economic bulletin, the Discount Company of Zimbabwe said
economic decline was accelerating at an alarming rate three months after
President Robert Mugabe stormed back into office amid charges of vote

"During the first 100 days of the president in office, the pre-election
status quo continues although an announcement has been made that government
remains committed to the Millennium Economic Recovery Programme ( with land
being the sector of emphasis," the company said. Mugabe had ditched the

"The first three months in power are crucial for any government because it
is the yardstick that is used to judge whether it is effective or not."

Mugabe had so far failed to put in place a new cabinet, viable economic
policy, stem hyperinflation, address foreign exchange shortages, deal with
chronic basic commodities shortages and stabilise the political environment.
University of Zimbabwe professor of business studies Tony Hawkins said the
Zimbabwe economic crisis would worsen because government had no tangible
economic policy.

"It is just a policy of drift," said Hawkins. "There is no direction and no
sign of a turnaround because the dramatic downturn is continuing across the
board. I cannot see any light at the end of the tunnel."

Zimbabwe's catalogue of problems include: the food crisis, foreign currency
shortages, inflation, company closures, unemployment, poverty, and a sinking
economy which is now said to be one of Africa's fastest-shrinking economies.

Zimbabwe's inflation rate of Weimarera severity now stood at 122,5% from
114% in April. The company said: "The inflation outlook remains bleak due to
the following factors: excessive money supply growth, and the crash of the
Zimbabwe dollar on the parallel market."

Analysts say government has in the past two years been relying on the
domestic funds for its operations due to a donor funding freeze. Its
borrowings have mainly been through treasury bills and the Reserve Bank
overdraft facility.

Borrowings through treasury bills crowd out private, productive investment
through upward pressure on interest rates, while the overdraft facility adds
money supply growth, which in turn intensifies inflationary pressures.

The government's domestic debt is Z302bn while external arrears are Z44bn.
Volatility in the foreign exchange market has also worsened the country's
economic situation. The Zimbabwean dollar's exchange rate against the dollar
has plunged on the parallel market from about Z320, just before the
presidential election in March to Z800.

This represents a premium of 1355% on the official rate of Z55 to the
greenback, a situation which fuels the parallel market activities as there
are significant arbitrage opportunities.
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AAG Finds $12 Million Hoarded Commodities

The Herald - govt paper (Harare)

July 11, 2002
Posted to the web July 11, 2002

The Affirmative Action Group (AAG) has uncovered hoarded goods valued at
about $12 million in month-long investigations.

AAG national spokesman, Mr Keith Guzah said the group had stumbled on hoards
of sugar, flour, bread, cooking oil in homes and warehouses.

These hunts have been conducted with assistance from the police.

"When we started we thought this would help to deter just a few individuals
and companies. But we have now realised this is a big operation.

"Companies are involved in this exercise and we have been inundated with
calls from various towns and sectors of the society. We have realised
hoarding is cancerous and should be avoided," said Mr Guzah.

"We work together with the police. We have set up task forces in Bulawayo,
Mutare and Harare. This is going to be spread to other towns.

"Hoarding is serious in this country and people bent on sabotaging the
economy for their political and financial gains have been at play."

The AAG introduced a $20 000 reward for information leading to the discovery
of hoarded goods. The hotlines on which members of the public can convey
information in the strictest of confidence are for people in Harare 011 215
188, 011 410 057, Mutare 011 204 405 and Bulawayo 011 400 908.

The AAG has called for stringent controls on foreign currency and tougher
penalties for people and companies that flout the exchange control act.

"We implore the Government to enact legislation which will effectively
cripple the financial capabilities of the offenders. In the past we had
banks paying very small fines for dealing on black market.

"The fines must be so heavy that banks, companies and people will think
twice before they engage in parallel market deals and externalising funds,"
said Mr Guzah.

The police have managed to recover goods that run into several millions of

Police spokesman, Inspector Andrew Phiri said: "We have recovered several
goods in a nationwide clamp down on hoarding and we are still recovering
more goods each passing day".

The police had deployed several officers to deal with cases of hoarding that
come up in the various parts of the country. Insp Phiri said the police was
grateful to members of the public who had joined hands with them in dealing
with the problem of hoarding.

"Most recoveries we have made in the past weeks were from the information
that was supplied to us by the members of the public and we appreciate their
contribution," he said.

The police spokesman, however, warned people involved in hoarding that the
law would take its course.

"As the police we are not going to rest until all the culprits are brought
to book."

Over the past few weeks there have been unprecedented cases of hoarding from
people bent on causing artificial shortages and sabotage the economy.
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African famine is the 'worst global disaster'

July 11 2002 at 06:01PM

By Antoinette Keyser

The threatening famine in six southern African countries which affects more than 12-million people is the worst humanitarian disaster in the world at the moment, the United Nations World Food Programme (WFP) said on Thursday.

The head of the WFP, James Morris, said at a media briefing in Johannesburg that the situation was desperate and getting worse by the day.

"Throughout the region people are walking a thin tightrope between life and death," Morris said.

'People are walking a thin tightrope between life and death'
"The combination of widespread hunger, chronic poverty and the HIV-Aids pandemic is devastating and may soon lead to a catastrophe.

"Policy failures and mismanagement have only exacerbated an already serious situation."

Long droughts and other adverse weather had also played a role in ruining crops.

The six countries affected by famine are Zimbabwe, Malawi, Zambia, Mozambique, Lesotho and Swaziland.

Morris said the WFP needed to raise at least $507-million (R5-billion) to feed 10,2-million of those worst affected by the lack of food. In Zimbabwe alone at least six million people are faced with starvation.

'This can escalate into an unthinkable human catastrophe'
He said in the last ten days the WFP had managed to raise $135-million. The United States had donated $98-million, the United Kingdom $28,4-million, while other European countries had also donated small amounts.

Morris said if the death of millions of people had to be staved off, countries would have to maximise crops, the private sector in those countries would have to get involved in supplying food and the world donor community would have to respond.

"We are in a crisis and we cannot overemphasise the seriousness of it."

He said most of the food would have to distributed before the rainy season began in October.

Morris said the worst hit were the children, women and the elderly.

"This can escalate into an unthinkable human catastrophe."

Morris said he had held talks with Zimbabwe's President Robert Mugabe about food aid being used for political gain.

"I made it very clear to him that the WFP will not tolerate the politicising of food distribution.

"We will have a zero tolerance towards political interference."

He said if he thought the WFP was not free to do its job, they would withdraw "in a second".

"But I would work very hard to resolve the problems, if any should arise."

Morris said the WFP had been calling the world's attention to the deteriorating situation in Southern Africa for two to three years.

The WFP would do a continuous assessment of the situation in the countries where food shortages occur. - Sapa

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