Zanu PF envoys sabotage Mugabe

http://www.theindependent.co.zw/

Friday, 08 June 2012 11:05

Owen Gagare

IN the aftermath of the Sadc summit in Luanda, Angola, where President
Robert Mugabe’s (pictured left) push for early elections was thwarted by
regional leaders who insisted on the implementation of the Global Political
Agreement (GPA) and elections roadmap before the next polls, it has emerged
Mugabe and his diehards were sabotaged by party negotiators and senior party
officials opposed to their electoral plans.

The situation has strongly brought to the fore that Mugagbe is navigating a
sea of trouble before the next elections, including internal factionalism
and infighting, fuelled by intensifying power struggles and divisions over
the way forward.

Disclosures that Zanu PF negotiators and senior party officials undermined
Mugabe ahead of the crucial Luanda summit come as Zanu PF hardliners are
also blaming their representatives in the constitution-making process
(Copac) for colluding with the MDC formations to slow down the exercise to
disrupt Mugabe’s elections agenda.

Hardliners, who include members of the Joint Operations Command (JOC), which
brings together army, police and intelligence chiefs, are behind Mugabe’s
vigorous push for early polls, with or without a new constitution.

Mugabe’s loyalists have also been privately calling for the removal of the
party’s negotiators, Patrick Chinamasa and Nicholas Goche, accusing them of
making easy concessions to the MDC parties during negotiations. Some senior
Zanu PF officials say the negotiators have now become too close and cosy
with their MDC counterparts, having worked together well before the GPA was
signed in September 2008 up to date.

Some Zanu PF negotiators and their party allies have reportedly become so
close that they are now involved in commercial transactions and deals which
the hardliners believe have compromised them. Sources say a Zanu PF
negotiator and another from one of the MDC formations are currently under
the police radar over a shady deal involving the construction and
refurbishment of roads.

Sources said Mugabe’s position going to Luanda was already weak, with his
party negotiators and envoys he had sent to the region having dissociated
themselves from calls for early elections which imply abandoning the GPA and
roadmap.

Sadc facilitator in Zimbabwe, South African President Jacob Zuma, had also
done his homework, having in March visited Botswana, Namibia and Angola.

When his facilitation team visited Harare last week on Monday ahead of the
summit they ensured they got the MDC parties and the negotiators on their
side, it was said. Sources further say some of Mugabe’s emissaries to the
region also destabilised his agenda by dissociating themselves from the
messages they were carrying.

“When the facilitation team was in Harare last week, our negotiators
re-affirmed the party’s commitment to reforms, including the
constitution-making exercise and implementation of the GPA and election
roadmap,” a senior Zanu PF official said. “They then agreed with the
facilitation team that there was need to work on the implementation
mechanism and this is the exact position which was recommended by the Sadc
Troika to regional leaders and finally adopted by summit. In Luanda, the
negotiators distanced themselves from the call for early elections and
re-affirmed their commitment to the election roadmap. This was against the
president and the party’s official position.”

Zanu PF and its negotiators have often taken different positions during Sadc
summits, including at Livingstone, Sandton and Windhoek. The divergence
between the hardline party position and the sober line of negotiators
widened before the Luanda summit.

Prior to the summit, Mugabe sent his envoys to influential countries in Sadc
to convince regional leaders to back his plans for early polls, arguing the
inclusive government, which he claimed was illegal, had outlived its
lifespan while there was now political and economic stability, as well as
peace, to hold elections.

Vice-President John Nkomo was sent to Pretoria to meet South African
President Zuma and Botswana to meet President Ian Khama, while Zanu PF
chairman Simon Khaya Moyo travelled to Namibia. Mugabe sent Defence minister
Emmerson Mnangagwa to deliver a special message to Sadc chair, Angolan
President José Eduardo dos Santos in Luanda while State Security minister
Sydney Sekeramayi went to meet with Zambian President Michael Sata in Lusaka
and Tanzanian President Jakaya Kikwete. The party’s secretary for
administration, Didymus Mutasa, was also part of the team which went around
the region with the message.

It is said some of these dissociated themselves from Mugabe’s messages,
telling the regional leaders there was no consensus on the issue.

Most Zanu PF officials, including Vice-President Joice Mujuru and Mnangagwa,
who lead the two main factions in the party, have not publicly and
systematically backed Mugabe on the election issue. JOC members and some
Mugabe diehards have been driving that agenda. Those who have publicly
backed early polls include Khaya Moyo, Mutasa, Youth secretary Absalom
Sikhosana as well as senior politburo member Jonathan Moyo.

Zanu PF spokesperson Rugare Gumbo has also been vocal over holding elections
this year, although he is believed to be neither working with JOC nor any
Mugabe diehard. He is said to be a Mujuru ally.

JOC hardliners and Mugabe diehards have been pushing for early elections
mainly because they fear Mugabe (88) may not be fit enough to endure the
rigours of a gruelling election campaign if polls are held next year, mainly
due to old age and health complications.

None of those who were part of Mugabe’s delegation in Luanda openly defended
his position, leaving him vulnerable. Mugabe was accompanied by Goche,
Chinamasa, Mnangagwa and Foreign Affairs minister Simbarashe Mumbengegwi,
among other officials. Zanu PF hardliners are now trying hard to limit the
damage after Luanda.

Parties clarify inclusive govt lifespan

http://www.theindependent.co.zw/

Friday, 08 June 2012 11:03

Faith Zaba

CONTRARY to President Robert Mugabe’s claims that the lifespan of the
inclusive government constitutionally expires in March next year, lawyers
and negotiators from the three political parties have clarified that it in
fact ends in June 2013.
In terms of Section 63 (4) of the Constitution, “Parliament, unless sooner
dissolved, shall last for five years,  which period shall be deemed to
commence on the day the person elected as president enters office after an
election … and shall then stand dissolved.”

This means the term of parliament is linked to the president’s tenure.
Mugabe was sworn in on June 29 2008, which means parliament’s term expires
June 29 2013.

However, the constitution allows the president to dissolve parliament before
its term ends. If he does not, elections must be held after June 29 next
year. According to Section 58 of the constitution, a general election shall
be held within a period not exceeding four months after parliament is
dissolved. This means the maximum constitutional limit for polls is October
29 next year.

This puts paid to Mugabe’s claims that he cannot extend the inclusive
government beyond March 2013.

The issue was clarified at the Sadc troika meeting in Luanda last week by
MDC leader Welshman Ncube who said the five-year term of parliament ends in
June 2013, which he pointed out was the month when the president was sworn
in.

This was not disputed by Mugabe and his team, who included lawyers Patrick
Chinamasa (Justice minister) and Zanu PF legal secretary Emmerson Mnangagwa.

Ncube was correcting Mugabe who had earlier claimed the inclusive government
was illegal and could not go beyond March next year.

In an interview with the Zimbabwe Independent this week, MDC-T negotiator
Tendai Biti said if there was no premature dissolution of parliament,
elections must be held within four months after June 29 next year.

“The term of office of parliament commences from the day the president is
sworn in, so this means that the five-year expiry date is June 29 2013,” he
said.
“So what this means is that we have up to end of June next year to implement
the reforms and hold elections thereafter. This is why we were given 12
months to implement the reforms at the troika meeting.”

Although he agreed with Biti, Zanu PF negotiator Patrick Chinamasa told a
Sapes Trust policy dialogue last night, “There will be elections sooner
rather than later. Elections must be held by June 29 2013.”

Sadc troika: Blow by blow account

http://www.theindependent.co.zw/

Friday, 08 June 2012 11:00

Faith Zaba/Owen Gagare

THE three political parties in the inclusive government last week agreed at
the Sadc troika meeting to fully implement the Global Political Agreement
(GPA) and necessary reforms, complete the constitution-making process and
put it to a referendum within 12 months before free and fair elections.
Sadc executive secretary Tomaz Salamao gave an overview of the Zimbabwe
political situation, citing general improvement.  South African President
Jacob Zuma briefed the meeting on his facilitation team visit to Zimbabwe
last week, where it met negotiators, who said the three parties were
committed to working together.

Zuma said there were a lot of expectations on Sadc to resolve the Zimbabwe
crisis.

“Everyone is therefore looking not just on Zimbabwe but to Sadc…We are
looking forward to a time when elections will be held without creating other
problems,” he said.

Mugabe said he was unhappy that the constitution-making exercise was
dragging on and blamed it on the two MDC formations which he accused of
stalling the process.

Mugabe said he wanted elections as soon as possible, holding that waiting
for the new constitution would be futile because the parties were
deadlocked.
He said GPA had “baptised and christened” people who lost elections. He said
he had studied law and the arrangement was “unconstitutional” but they had
done it for the good of the country. Mugabe said the government was not
given a mandate to run for five years.

Prime Minister Morgan Tsvangirai said government was dysfunctional, noting
there was a clique in Zanu PF which wanted to collapse the GNU so that
elections are held under the current constitution.

He said Zanu PF was insincere on reforms as evidenced by some ministers’
refusal to implement the GPA and their open support of services chefs who
were dabbling in politics.

Tsvangirai also informed the troika that there was a resurgence of violence
and that the military was still making threatening remarks. He called for
polls to be held after  implementation of the roadmap.

MDC-N leader Welshman Ncube said the government was constitutional because
the GPA had been incorporated into the constitution.

He said the people had voted for an inclusive government by virtue of none
of the parties getting 50% plus 1 and a hung parliament.

The MDC leader said none of the agreed issues in the election roadmap had
been implemented although work was in progress on the constitution and a
ministerial team was engaging the European Union on sanctions.

He suggested Zuma should visit Zimbabwe urgently and work with the
principals on implementing the GPA.

Deputy prime minister Arthur Mutambara said although elections were needed,
they should be held after reforms.

He said media, political, security sector and electoral reforms had to be
carried out first.

“If you rush into an election you will replace dysfunctionality with
illegitimacy.

“Dysfunctionality is better than illegitimacy. You must not allow that. Let
us suffer this arrangement and do the reforms, and maybe just maybe we will
be able to produce an outcome that no one will contest,” he said.

“I am very embarrassed for continuing to come here. Let us do that what we
can in the next 12 months. Our elections must be process driven. Let’s put
timeframes. Don’t discuss a date discuss processes, don’t discuss processes
but timelines.

Tanzanian prime minister Mizengo Kayanza Peter Pinda insisted on reforms
before elections.

“Elections without completing this process will be worse than 2008. This
will not be a credit to Sadc,” he said adding that Mugabe must do it for
Zimbabweans.

Angolan President José Eduardo dos Santos, who is the Sadc chair, said there
was need to speed up the constitution-making exercise. He said the election
roadmap and GPA should be implemented before polls.

Zuma promised to travel to Zimbabwe to engage principals. He is expected in
Harare next week.

l Meanwhile Justice minister Patrick Chinamasa has warned of an escalation
in “war mongering” and exaggerated reports of violence by the MDC formations
in the run-up to the next elections.

Chinamasa,  one of Zanu PF’s negotiators, said this would be meant to
provoke Western intervention as was the case in Libya, leading to the ouster
and killing of former ruler Muammar Gaddafi.

Chinamasa last night told an emotionally-charged public seminar organised by
Sapes Trust in Harare, running under the theme “After Luanda:  Whither
Zimbabwe”, that the MDC parties would cause turmoil before the polls.  At
the seminar negotiators of the three GPA political parties discussed the
outcome of the Sadc summit held in Luanda, Angola, last week. Finance
Minister Tendai Biti represented MDC-T, while and Priscilla
Misihairabwi-Mushonga stood for MDC-N.

Chinamasa said made ominous conclusion to his representation.

“Let me conclude by a prophetic message. I am not a prophet, but what I am
going to say is very prophetic. What I see ahead of us is warmongering. I
see warmongering. The tendency to provoke incidences, to overblow them and
exaggerate, to distort in order to allow a Syria/Libya-type situation in our
country,” he said.

Sata’s antics get into overdrive

http://www.theindependent.co.zw/

Friday, 08 June 2012 11:00

ZAMBIAN President Michael Sata (pictured) stole the show at last week’s Sadc
summit in Luanda with his exaggerated antics which bordered on embarrassing
clowning, in the process annoying some delegates who felt his remarks were
more appalling than comical.
Right from the start of the troika meeting, Sata appeared determined to
indulge in attention-grabbing clowning around when he welcomed President
Robert Mugabe with chants like “sekuru, sekuru (old man)”, pamberi ne Zanu
PF, pamberi ne Jongwe (forward with Zanu PF, forward with the cock (Zanu PF’s
symbol).

Regional leaders and officials who attended the meeting said they were
dismayed by Sata’s unstatesmanlike behaviour. South African President Jacob
Zuma, Sadc troika chair and facilitator in Zimbabwe, chaired the meeting.
Sadc chair, Angola President Jose Eduardo dos Santos was present, including
Tanzanian premier Mizengo Kayanza Peter Pinda.

As the Zimbabwe delegation stood up when Mugabe entered the meeting room
Sata, pointing at them, shouted “sekuru, vazukuru vako avo” (old man, there
are your young boys and girls).

During the meeting, Sata is said to have made constant interjections,
annoying some leaders. At some point Sata shouted Zimbabwean deputy prime
minister Mutambara and MDC-N leader Welshman Ncube after their
presentations, saying: “I would like to ask these two professors, why are
you in this forced marriage? I’m ask a simple thing, why are you in this
illegal thing?” Mutambara and Ncube are both professors. Sources said Ncube
replied: “No, I will not answer that question because its foundation is
incorrect. The agreement is not illegal”.

After Mugabe, Prime Minister Morgan Tsvangirai and Ncube had presented Sata
pounced once again, remarking: “We are lucky to have President Dos Santos
and President Zuma because the people who are here don’t remember 1963.
Where were you in 1963 when we were fighting imperialism?” he asked. “Where
were you when Zanu PF was formed?”

On media reforms, Sata said there was no need for media reforms because “if
you are a news maker you will always make news anyway!” whether there are
reforms or not.

Sata also charged: “Don’t point to fingers at Mugabe because when you point
at him three fingers are pointing at you. Don’t blame sekuru here. If you
have a younger alternative show us sekuru will retire and then Zuma will
retire, Dos Santos will retire but I will not retire because I am only six
months into government”!

In response to Tsvangirai’s contribution on Mugabe unilaterally
re-appointing the top army and police commanders, Sata retorted: “Where in
the world have you seen a situation in which to appoint generals the
president must first beg the prime minister?”

Sata dismissed calls for reforms, saying “You people don’t want to go for
elections because you don’t have a message. Do you want Mugabe to look for a
message for you?  Look for a message for yourselves and go to face the
people!”

And after it was agreed that the three parties should fully implement the
GPA and complete the constitution-making process before polls, he said: “You
Sadc, if you listen to some of these things then you are just replacing
colonial masters. Here in Angola they are saying that President Dos Santos
is too old and you President Zuma, they say you are also old. Did they apply
to be old?”

Sata’s theatrics did not stop there. On concerns raised by Botswana present
Ian Khama on the need to keep time for meetings, he blamed Sadc secretariat
and Zuma. “No! that secretariat is bogus. They should tell the truth –– it
was Zuma who was late”.

Sata’s remarks on women such as Malawian President Joyce Banda whom he
described as an “amateur”, Thokozani Khupe, Priscillah Misihairabwi-Mushonga
and a lady in the Botswana delegation, infuriated some delegates. Equally
infuriating was his call for Sadc to bribe other African countries to vote
for South African Home Affairs minister into the AU position.

ZRP splashes on luxury cars

http://www.theindependent.co.zw/

Friday, 08 June 2012 10:54

Paidamoyo Muzulu

THE government’s appetite to spend more on luxury vehicles and foreign
travel than service delivery has been further exposed after the
cash-strapped Zimbabwe Republic Police (ZRP) recently splurged over US$7,5
million in acquisition of over 60 luxury vehicles for personal use by to
senior officers.

The police purchase of cars overshot by three times the department’s 2012
budget of US$2,6 million set for cars in the Blue Book.

As if taking a cue from cabinet ministers, the force recently purchased the
2012 models of top of the range vehicles like the BMW 328i series saloon
cars, Range Rover Sports, Nissan Navara LE double cabs to latest Ford Ranger
LXT and double cab Sport Utility Vehicles (SUVs) for senior officers.

The delivery of vehicles comes  hard on the heels of cabinet’s outrageous
splash of over US$20 million for the purchase of Mercedes Benz E280s for
ministers, Land Rover Discovery 4 TDis for deputy ministers, and Jeep
Cherokees and Range Rovers for permanent secretaries late last year.

Other senior civil servants like principal directors and directors now drive
the latest Isuzu KB300Dtec double cabs while parliamentarians have received
either Isuzu 300Dtec or Mazda BT50 double cabs.

The police took delivery of the vehicles in the last six weeks but the cars
have remained out of the public eye since they are unmarked and have no
registration plates.

The Zimbabwe Independent saw the new fleet parked at the designated senior
officers’ parking bays at Police General Headquarters in Harare.

Sources revealed that the saloon cars and SUVs were bought for senior
officers from the rank of Senior Assistant Commissioner (SAC) to
Commissioners and the Commissioner-General.

“The police force recently acquired the fleet of vehicles for about 30
senior officers,” said one source. “The figure takes into consideration that
there are two SACs in each administrative province and the others are at the
Criminal Investigations’ Department, Police Protection Unit, Traffic, Border
Control and the remainder at the commissioner’s pool.”

Research showed that a BMW costs about US$35 795, Ford Ranger XLT 3.2 diesel
double cab US$53 390 and the Nissan Navara LE 3.0dCi V6 R533 000.

However, local car dealers are selling the BMW 328i for US$98 000 while the
SUVs go for anything between US$70 000 and US$90 000, including duty and
other taxes.

The cars have leather seats, hi-fi-stereos and come with Internet
connectivity, among other specifications.

Chief police spokesman Senior Assistant Commissioner Wayne Bvudzijena
confirmed purchase of the vehicles saying they were acquired as part of
conditions of service for senior staff.

“There is nothing sinister since it’s not the police who decides what makes
or models to buy but the Police Service Commission in conjunction with the
Public Service Commission,” said Bvudzijena.

He said the acquisitions were not limited to the police but officers
ofsimilar rank in the military, Central Intelligence Organisation and Prison
Services.

In addition to these acquisitions, the force has also bought Ford RangerXLT
single cabs for Chief Superintendents at district levels.

Bvudzijena declined to identify the source of funds, but it is widely
believed that it is money collected from traffic fines or diamond proceeds.

“It’s government money but I am not at liberty to disclose the real source
but it is still government money,” Bvudzijena said.

Last month, Home Affairs permanent secretary Melusi Matshiya told parliament
that police were depending on money from traffic fines since they were
getting very little from treasury. Police are also involved in diamond
mining.

Transport minister Nicholas Goche was not immediately available to comment
on how much the state had spent in the acquisition of vehicles.

Government has faced fierce criticism from civil servants who for have been
calling for a review of their salaries and working conditions in vain.

Last year the government only reviewed upwards the civil servants’ transport
and housing allowance. Finance minister Tendai Biti is on record saying
salaries will only be reviewed if diamond revenues started coming to
Treasury. Government is currently spending nearly two-thirds of its revenue
on recurrent expenditure leaving very little for capital projects.

Biti told parliament in April during the first quarter budget performance
review that most ministries had overspent more than their annual transport
and subsistence allowance within the first three months.

Biti’s calls for ministries to live within their means have largely gone
unheeded as the opulence of senior civil servants and VIP travels continues
to overshadow service delivery.

Zanu PF officials accuse Nkala of distorting facts

http://www.theindependent.co.zw/

Thursday, 07 June 2012 18:57

Brian Chitemba

SENIOR Zanu PF officials in Matabeleland have accused Zanu PF founding
member and former Defence minister Enos Nkala of committing atrocities
against the people of the region before and after Independence.

This was in response to Nkala’s pronouncements this week distancing himself
from the Gukurahundi massacres, which left over 20 000 people dead in
Matabeleland and parts of Midlands between 1983 and 1987.

Nkala resigned in 1989 from government and Zanu PF in a huff after being
implicated in the Willowgate vehicle scandal. He was Minister of Defence at
the time.

Last week Nkala also attacked Matabeleland politicians as spineless, drawing
a barrage of angry reactions from a Zanu PF clique comprising former Zapu
senior politicians who joined Zanu PF following the Unity Acord of 1987.
They labelled Nkala a “sellout” who always plotted against the late former
Vice-President Joshua Nkomo and the Matabeleland region at large.

A politburo member told the Zimbabwe Independent this week Nkala started
working against Nkomo as far back as 1957 resulting in the formation in 1963
of the breakaway Zanu from Zapu.

According to politburo source, Nkala failed in an attempt to topple Nkomo as
Zapu leader and hence his hostility toward him.

“How can Nkala accuse Matabeleland politicians of being spineless when he
was the one who planned Gukurahundi and other shameful acts which resulted
in the loss of lives of thousands of innocent and courageous people?” asked
onepolitburo member.

But Nkala insisted he never killed anyone when he served in President Robert
Mugabe’s government in the 1980s. On  reports that he was part of a plot to
assassinate Nkomo, Nkala defended himself saying he was in fact the one who
had alerted him to the plot and advised him to flee the country in 1983.
“There were plans, I believe, to assassinate him,” said Nkala. “I contacted
him to get out and go to London.”

Another politburo member said Nkala was a dangerous “mole” who sowed serious
divisions even during the liberation struggle.

Nkala is on record making numerous inflammatory remarks against Nkomo and
Zapu. He is widely blamed for inciting violence in Matabeleland.
“Some of us are former Zapu and we are in Zanu PF because of the Unity
Accord which was signed to stop the mass killing in the 1980s, but Nkala is
Zanu PF through and through,” said the politburo member.

Nkala recently held a 45-minute closed-door meeting with Mugabe at the
Joshua Nkomo International Airport, sparking speculation that the veteran
but ailing politician was set for a rebound in the political arena.

“Nkala will never be forgiven for his role in Gukurahundi because we know he
was involved in the mass killings. A lot of people disappeared because of
him,” said the senior Zanu PF member.

Kasukuwere bulldozes his way

http://www.theindependent.co.zw/

Thursday, 07 June 2012 18:57

Tendai Marima

INDIGENISATION minister Saviour Kasukuwere is intensifying pressure on
foreign-owned banks to comply with the controversial empowerment laws
despite bankers’ protests that the sector is already controlled by local
investors.
Reserve Bank governor Gideon Gono and bankers have been resisting Kasukuwere’s
proposals, arguing the sector is dominated by indigenous players. Gono said
last week he preferred a “gradual approach

However, Kasukuwere is trying to bulldoze his way through. After summoning
Bankers Association of Zimbabwe president George Guvamatanga, who is also
Barclays MD, for talks on Monday, the minister held further meetings with
officials of Standard Chartered, Stanbic and MBCA on Tuesday in a bid to
force them to yield to his plans.

“We are aware Barclays has a local listing of about 33% and we want to
identify who are the players in there, are they indigenous or not. We need
to identify if they are bona fide indigenous persons or entities,”
Kasukuwere said in an interview on Wednesday.

The minister said he would push Barclays to comply, saying “they are going
to immediately transfer 10% to workers and then after that 5% and 3% to the
indigenous investors to make it 51%”.

Kasukuwere is said he would meet with Barclays officials next week to try to
bring finality to their negotiations. “After meeting them on Monday, we
spoke to them this morning (Wednesday) and we will go back to them again
next week to check progress on implementation,” he said.

Ipec orders dismissal of Maphosa

http://www.theindependent.co.zw/

Thursday, 07 June 2012 18:56

Gamma Mudarikiri

THE Insurance and Pension Commission (Ipec) has ordered the immediate
dismissal of Mining Industry Pension Fund (MIPF) chairman James Maphosa on
charges of incompetence.
An Ipec report seen by the Independent said the board headed by Maphosa
failed to hold meetings consistently as required, resulting in the fund
operating without an approved  budget and audit plan, among other
allegations.

“The chairman should be relieved of his duties since the commission believes
him not fit and proper to preside over the affairs of the fund,” reads part
of the report.

Maphosa is accused of having an overbearing influence in the operations of
the board of trustees, which seriously compromises its independence.

However, both the MIPF and Maphosa had not responded to the report 14 days
from the date from which they had been asked to. Maphosa said   he   failed
to respond within the stipulated time frame because   he was outside the
country for medical purposes.

Ipec was irked by the fact that the last MIPF board meeting was held on
September 6 2011 while the one scheduled for February 21  2012 was aborted
due to allegations of  irregularities in the appointment of new trustees.

Internal strife rocks MDC-T Mat South

http://www.theindependent.co.zw/

Thursday, 07 June 2012 18:56

Nqobile Bhebhe

INTERNAL strife has rocked the MDC-T in Matabeleland South with its
supporters demanding evaluation meetings with incumbent MPs and councillors
to ascertain if they are suitable to run for another term in the next
elections.
However, resistance by sitting MPs has prevented the meetings from being
held.

The MDC-T’s representatives in the province include its national chairman
and Speaker of parliament, Lovemore Moyo, Gabriel Ndebele and Sithembile
Mlothswa, as well as scores of councillors in various districts.

Party insiders said MDC-T supporters in the province are demanding that all
MPs and councillors present reports of what they have done since elected.
It is from these scorecards that members would then decide whether to give
them another chance or dump them.

“We are drawing closer to crunch elections and we want to undertake an
evaluation of what our legislators and councillors achieved and what was not
implemented based on their election promises,”said a party insider.

“As a democratic party, members feel that leaders should prove their worth
to be the party’s representatives. However, our moves seem to have hit a
brick wall, at least for now.” Ndebele said: “Elected members are willing to
present updates to members but proper procedures should be followed.

I doubt whether this matter is coming from bona fide party members or it’s
just a small group. Anybody who has grievances and is a bona fide MDC-T
member should use party structures to air their concerns. As an MP for
Matobo South, any party member is free to challenge me.”

Mzembi embroiled in controversy

http://www.theindependent.co.zw/

Thursday, 07 June 2012 18:22

Wongai Zhangazha/Herbert Moyo

COMPTROLLER and Auditor-General Mildred Chiri has ordered an investigation
into the procurement procedures by the Ministry of Tourism of Liquid
Electronic Display (LED) television sets from China which were supposed to
be installed at fan parks during the 2010 World Cup but only arrived three
months after the tournament.

This comes as Tourism minister Walter Mzembi is under the spotlight for his
involvement in the loss-making and controversial Benjani Mwaruwari
testimonial match two weeks ago.

Mzembi was also embroiled in controversy following the Warriors friendly
against Brazil in the run-up to the 2010 World Cup finals in South Africa.
Allegations were that he had used his position to secure a contract to ferry
the Brazilian national team during its visit.

These issues have put Mzembi under scrutiny amid fears he is using his
position to pursue  personal interests.

In her 2010 audit report, Chiri said an investigation should be carried out
to establish why tender procedures were followed or not  and why the
Ministry of Tourism allowed the delivery of the equipment  worth US$2
million 13 weeks after the World Cup.

In April 2010 Mzembi’s ministry made arrangements to purchase 40 LED TV
units from a company in China as part of preparations for the World Cup, but
the sets were only delivered 13 weeks after the event.

Chiri said: “Since the units were received after the end of the World Cup,
it is my opinion that the purpose for which the units were acquired was not
met, thereby rendering the expenditure incurred nugatory”.

She added that the absence of documentation for audit examination concerning
the fan park equipment loaned to the Zimbabwe Tourism Authority and also the
loaning of state equipment was tantamount to misapplication of public
assets.

“At the time of audit on May 29  2011, generators powering the fan park
equipment were said to be at Manyame Air Force base where they were sent for
safe keeping. The balance, comprising 10 generators, was loaned to the
Zimbabwe Tourism Authority as complete sets, while one generator was said to
be in use at Murombedzi Growth Point, where fan park equipment was
installed,” Chiri said.

“An investigation should be carried out to establish why tender procedures
were not followed and why the ministry allowed the delivery of the equipment
at the end of the World Cup showcase where it was supposed to have been
used.”

Without explaining why the TV units were delivered late, Mzembi dismissed
Chiri’s report as a “petty issue”, saying the televisions could be accounted
for, but have since been “donated” countrywide.

Besides the televisions and Brazilian match controversies, sources close to
the Mwaruwari testimonial match fiasco say President Robert Mugabe grilled
Mzembi for almost 45 minutes, demanding explanation why the Tourism Ministry
got involved in a football match project which should fall under Zifa and
the Ministry of Education, Sports and Culture (David Coltart’s
jurisdiction).

Sources said senior football administrators, including Ndumiso Gumede, only
agreed to be part of the proceedings after a phone call from Zifa President
Cuthbert Dube who was in Brussels on Fifa business.

Zifa, which did not want to be part of the event if those implicated in
Asiagate like Henrietta Rushwaya were involved, is still fighting Mwaruwari
over contract obligations and money. It is feared Mwaruwari’s testimonial
match proceeds were looted by shadowy characters who were involved.

Mzembi, however, said his meeting with Mugabe was “cordial” and he had
explained to him how the testimonial match had been suggested to him by
Mwaruwari and its benefits to tourism through hotel revenue and related
expenditure from fans coming from outside Harare and the region.

He also said there was no acrimony between himself, Zifa and the Ministry of
Education as demonstrated by Gumede’s presence at the match, which was
nothing more than a “glorified social soccer game” that did not have to be
under the jurisdiction of Zifa.

Gumede and other senior football officials were not impressed by how
politicians and opportunistic characters got involved.

China in massive investment drive

http://www.theindependent.co.zw/

Thursday, 07 June 2012 18:21

Herbert Moyo

CHINA is set to invest massively in Zimbabwe’s decaying water, power, and
transport infrastructure, following the recent visit to Beijing by Prime
Minister Morgan Tsvangirai and government ministers, Gorden Moyo and Samuel
Sipepa Nkomo.
During the trip the premier said Zimbabwe was in dire need of assistance in
“embarking on an aggressive programme of infrastructure rehabilitation”.

Water Resources Development and Management minister Samuel Sipepa Nkomo said
Chinese capital and expertise were essential in the construction of
hydro-electric projects to boost Zimbabwe’s power generation capacities,
including solving Matabeleland’s perennial water problems.

“Sino-Hydro (a Chinese company) will be coming to look at Takanda dam near
Nyamapanda, with a view to constructing a hydro-electric project to produce
3 000 megawatts of electricity,” said Nkomo. “Zimbabwe has more than 200
large dams and there is the potential to construct hydro-electric schemes to
boost our electricity output.”

Nkomo also said he had signed a memorandum of understanding (MoU) with the
Chinese government, which would see a Chinese company coming to engage in a
variety of projects including irrigation.

He added he held a fruitful meeting with Chinese Water Resources minister
Chen Lei, who invited him back to China in September, where they would
conclude another MoU to assist Zimbabwe through capacity-building
programmes.

Minister of State Enterprises and Parastatals Gorden Moyo said they met
various Chinese state enterprises (Seps), including China Machinery and
Engineering Corporation, Sino-Sure (financial services) and Hydro-Sino
currently undertaking power-generation activities with the Zambian
government at Kariba North.

“The strength of China is in its well-managed and well-resourced Seps,” said
Moyo. “We went there to understand their model as they are also coming from
a background where Seps were loss-making, poorly managed and infested by
corruption. We went there to understand how they transformed these Seps to
technological success.”

He said they also discussed how Zimbabwean Seps could work closely with
their Chinese counterparts to achieve re-capitalisation through
joint-ventures, as well as assistance to re-capitalise Zimbabwe’s Seps to
enable them to fulfil their potential of contributing to at least 50% of
GDP, employment and services.

China is projected to become the world’s biggest economy by 2020.

Tsvangirai’s visit — which has irked Zanu PF officials who consider Beijing
their exclusive ally in Zimbabwe — suggests China is looking beyond Mugabe’s
rule. The Chinese have always been considered close allies of Zanu PF since
the liberation struggle. However, Tsvangirai’s visit at the invitation of
the Chinese government has given the distinct impression that  he could form
the next government.

In his speech at the Sino-African Trade in Services and Investment Forum in
Beijing on May 29, Tsvangirai assured the Chinese investors of government
protection but stressed the importance of investments that gave maximum
benefit to Zimbabweans.

Storm over tourism indaba

http://www.theindependent.co.zw/

Thursday, 07 June 2012 18:17

Wongai Zhangazha

“MUGABE: international tourism ambassador!! No thanks!”
This is one of a series of messages that are part of an online campaign
being waged by human rights activists in Europe and elsewhere protesting
against the alleged appointment of President Robert Mugabe as international
tourism ambassador by the United Nations World Tourism Organisation (UNWTO).
This campaign was torched off by state media reports last week claiming
Mugabe and his counterpart Zambian President Michael Sata had been appointed
United Nations international tourism “ambassadors” in recognition of their
role in the promotion and development of tourism.

Zimbabwean and Zambia, along with the Secretary General of UNWTO, signed a
trilateral agreement last Tuesday to co-host the UNWTO General Assembly in
Victoria Falls and Livingston in August next year.

Tourism and Hospitality Industry minister Walter Mzembi has been quoted as
saying UNWTO had awarded Mugabe and Sata the ambassadorial “status” in
recognition of their efforts in showcasing tourism’s critical role in the
development of Africa.

This has sparked a furore in tourism circles with many human rights
activists asking how Mugabe could be a tourism ambassador given the country’s
poor human rights record and destruction of tourism.

In response to the criticism, the UNWTO issued a statement, saying: “The 155
UNWTO member states decided, at the 19th Session of the UNWTO General
Assembly held in October 2011 in the Republic of Korea, to hold the 20th
session of the UNWTO General Assembly in Victoria Falls (Zambia/Zimbabwe) in
2013. In this framework, the UNWTO Secretary General was in Victoria Falls
on 29 May 2012 to sign a tripartite agreement with both countries on the
hosting of the 20th session of the General Assembly … On the occasion of the
signature of the above mentioned agreement, the Secretary-General presented
the Presidents of Zambia and Zimbabwe with an open letter on travel and
tourism.

“This letter was sent to all heads of state and government worldwide and
aims to raise awareness of the potential of tourism for development, job
creation and economic growth. UNWTO does not have an ambassadors programme
and that the receiving of the open letter implies no legal commitment or
official title attribution to the country or recipient”.

Canada was so angry with UNWTO for “honouring Mugabe as a global leader of
tourism” that it quit the organisation. Last week it formalised its
withdrawal from the UN tourism body, with Canadian foreign minister John
Baird saying correspondence by the UN world tourism office, in which its
secretary-general reportedly praised Mugabe and Sata for their role in
tourism at Victoria Falls, was the “last straw” in the country’s
participation.

The UNWTO General Assembly is the world’s supreme tourism decision-making
body and is expected to attract a significant number of international
investors and tourists at its conference next year.

Zimbabwe Crisis Coalition regional information and advocacy co-ordinator,
Dewa Mavhinga, said Mugabe was not a tourism ambassador, but people had
fallen for propaganda.

“Well, we understand that no such appointment has been made, and that it is
only Zanu PF trying to exaggerate the importance of a letter written to
President Mugabe which is not officially recorded on the UNWTO website,”
said Mavhinga.

“Mugabe has not been appointed tourism ambassador by the UN, but even the
letter written to him and Zambian President Sata over the co-hosting of the
UNWTO conference next year sends the wrong signal to him and the
international community.”

He said the murder of MDC-T official Cephas Magura by alleged Zanu PF
activists in Mudzi last month is “clear testimony Zimbabwe is not out of the
woods yet”.

“This is not the time to shower Mugabe and his cronies with accolades of any
sort; it is time for  sustained pressure to deliver reforms that will pave
the way for credible, non-violent, free and fair elections,” said Mavhinga.

An organisation called Avaaz meaning “voice” in several European, Middle
Eastern and Asian languages last week denounced the supposed appointment of
Mugabe.

“It may be hard to believe — but a UN body has just announced Mugabe as its
latest international tourism ambassador!” reads the campaign message.
“Better known for his brutal suppression of democracy in Zimbabwe, the UNWTO
has seen it fit to honour Mugabe as an international ‘leader for tourism’
and urged people to visit his ‘wonderful country’. The man who has
single-handedly destroyed Zimbabwe’s international reputation with repeated
human rights abuses, and Zimbabwe’s tourism industry along with it, is now
an official ambassador for tourism!”

However, Mugabe has not been without support. Tawanda Kanhema, editor of
Investigative Africa, a news blog on African affairs based in the United
States, believes the move by Canada to quit the UNWTO General Assembly and
subsequent negative campaigns are short-sighted.

“Countries boycotting the UNWTO are basically boycotting Zimbabwe’s
leadership,” said Kanhema, a former Herald reporter. “Mugabe is a
figurehead, but he represents a much more diverse country, a vibrant tourism
industry with a lot of potential and one of the countries that has pursued
the most sound conservation policies in Africa, if not in the world. The
UNWTO does not just randomly pick tourism ambassadors (but) this is a
recognition of the contribution that several people and organisations in
Zimbabwe’s tourism sector have made to ensure the country’s competitiveness
and preserve its biodiversity, not a referendum on Mugabe’s record as a
leader.”

Commentator David Takawira said it was necessary the host country plays
“ambassadorial” role.

“We should also note that the event is not for the president but
Zimbabweans. They could try to lobby for the observation of human rights and
rule of law in Zimbabwe either through demonstrations here on the particular
days that the assembly will be held,” he said.

Since 2000, tourism has terribly declined due to the political and economic
situation in Zimbabwe including the country's international isolation and
bad publicity.

Plan to rescue troubled banks

http://www.theindependent.co.zw/

Thursday, 07 June 2012 17:16

Chris Muronzi

AN international financial consultant with local business interests has
proposed a plan that would help government save indigenous banks currently
reeling from liquidity crisis and non performing loans in the event of a
collapse.
A document sent to government recently and seen by businessdigest shows that
a leading global fund manager has urged government to come up with a plan
that would, among other things, see the existence of fewer but consolidated,
larger banks.

This comes against the backdrop of a struggle by many indigenous banks to
raise the US$12,5 minimum capital requirement and the imminent collapse of
banks such as Interfin and Genesis. A number of local banks are struggling.

According to the proposal, reduction inthe number  of banks would be
achieved through consolidation and increasing minimum capital requirements
to US$50 million.

As part of the proposal, a corporation owned by the Ministry of Finance
would be established as a close-ended domestic special purpose vehicle.

This corporation would be managed by an independent management company,
established by the consultant and staffed with dedicated professionals with
the appropriate credit skills.

It would then charge a management fee based on total assets under management
and a performance fee based on recoveries, with all other returns accruing
to the company channelled towards building a capital buffer.

The corporation would have a board of directors chaired by the Minister of
Finance, two members from the Ministry of Finance and three independent
non-executive directors.

Although the Government of Zimbabwe would facilitate this solution, the cost
of bailing out the banking industry would be borne by the industry itself
through the payment of a levy on banking assets.

In order to raise funding, government would impose a levy on all licensed
banks, based on total risk-weighted assets for 10 years.
The sinking fund’s assets would be managed by the consultant.

The proposed management company would be managed on a best practice basis
through allocations to third party asset managers.

The levy would be 2% of total risk-weighted assets but this level would
reduce to 150 basis points over five years to take into account the expected
growth of the banking sector, the proposal says.

“It is likely that the growth of assets in the banking industry will be
significant, and the sinking fund may be over-­funded. Such surplus capital
could, in time, be deployed to support lending for SMEs, or other targeted
industries,” the proposal says.

The architects of the proposal are targeting investors such as Afreximbank
and the Development Bank of Southern Africa to chip in with US$350 million,
international organisations such as sovereign wealth funds to invest US$150
million, while others such as the National Social Security Authority and
domestic banks would be expected to come in with US$150 million each.
Domestic depositors were expected to come in with US$50 million, according
to the proposal.

The financial experts also noted that while most domestic banks faced a
liquidity crisis, many were technically insolvent and probably trading with
negative capital if they were to write-off or provide for bad and doubtful
debts.

More importantly, such banks as remained out of such consolidation would
have to be governed by persons truly “fit and proper” for this purpose.

“One way to achieve this is to identify those banks that have such high
calibre persons in place and encourage them to be the consolidators, with
the ones with less good governance becoming the consolidated,” the proposal
reads. “Such a process can only follow or be combined with a restructuring
of the banking system by creating a Resolution Vehicle capable of taking
over the bad and doubtful debts from the banks and thus returning liquidity
and capital back to the banks.”

The consultant said the principal beneficiary of this would be the economy
as a whole, as the banking system would once again be able to start issuing
loans based on the true cost of funds and not the opportunistic
undisciplined lending that charecterised the past few years.

Such a Resolution Vehicle will need to be funded by placing 10-year tax free
bonds with investors.  Such bonds would be serviced and retired from the
recoveries on the loans taken over as well as the tax to be levied on all
banks, equal to 2% of Gross Banking Assets over a 10-year period.

The 2% charge, according to the plan, would be reviewed downwards as banking
assets grew in size.  “With current banking assets of the size they are
being carried at (after write-offs and provisions that should be made), the
income would be $30-50mm annually, but should grow rapidly,” reads the
proposal.

Sadc should ensure Zim stays on track

http://www.theindependent.co.zw/

Thursday, 07 June 2012 17:49

Qhubani Moyo

THE outcomes of last week’s Southern African Development Community (Sadc)
summit as well as the troika meeting in Luanda, Angola, are important in
many different ways.
At the core of the Luanda summit was the discussion on how to integrate the
three regional economic blocks, namely the East African Community, Comesa as
well as Sadc. Regional integration requires shared solutions to political
and economic problems. Increasing regional trade and investment is essential
to meeting Africa’s social challenges.

The integration of these economic blocs is also crucial in ensuring bigger
markets and improving trade amongst member states as well as strengthening
Africa’s voice in the broader global economic agenda.

Africa is endowed with vast natural resources, yet it remains the poorest
continent in the world –– home to the globe’s poorest billion people.
Instead of the resources of the continent being used to develop and
transform the lives of its people for the better, they are siphoned
overseas. Due to lack of beneficiation and value addition, Africa is losing
billions annually.

Besides, the resources are being looted and going to waste due to corruption
and incompetence by ruling elites. Public resources are also abused to
promote patronage and defend entrenched dictatorships. In countries with
oil, diamonds, gold, platinum and other valuable resources, the masses
remain desperately poor while the rich live in the laps of luxury.

Resources which should be used to build crucial infrastructure, including
roads, hospitals, schools and dams as well as factories, medicines and food
are diverted towards arms, teargas and baton sticks, among other instruments
of repression.

Instead of having budgets more attuned to social services provision, huge
allocations are given to the army, police and secret services who in most
cases serve partisan political agendas, not the national interest.

As a result of the uneven distribution of national resources, Africa has
become the hotbed for conflicts exacerbated by disease and famine. However,
recent developments, which saw among other things the strengthening of the
African Union Peace and Security Council through the establishment of an
African standby military brigade, is a step in the right direction.

Equally important is the active role in peace and conflict prevention,
especially by blocks like Ecowas.

Sadc, previously seen as a club of dictators, seems to be gradually changing
and transforming into a more cohesive and effective organisation. The
ongoing democratic transition and consolidation is still work in progress.

The current generation of Sadc leaders is breaking way from the
backward-looking culture of revolutionary and fraternal solidarity which
thwarted democratic development and expansion. The Zanu PF leadership, still
frozen on the liberation struggle paradigm and ethos, has failed to adjust
and keep in touch with changes within the region. That is partly why
President Robert Mugabe and his loyalists now find themselves rather
isolated at Sadc meetings.

When Sadc leaders demanded last week that Zimbabwean parties in the
inclusive government should respect and uphold their commitment under the
Global Political Agreement (GPA), Zanu PF leaders were left wondering why
they are now almost always at odds with their former liberation comrades.
Yet it is clearly because of the changes within Sadc and globally, as well
as shifting dynamics within Sadc member states themselves.

The insistence by Sadc leaders that parties must first implement the GPA in
full and adopt reforms within 12 months before elections should therefore
not be surprising, although it was a heavy political blow to those within
Zanu PF and the security establishment trying to force early elections
through the backdoor.

Zanu PF’s strategy of trying to stampede the nation to elections this year
without the major reforms, including amendments of electoral laws,
completion of the constitution-making process which must come with
devolution of power, civil and political freedoms together with freedom of
expression, assembly and association, and a reorganisation of the executive,
among many other things, which will ensure free and fair elections, must be
resisted.

That is why there is so much agitation and anxiety about the outcome of the
Luanda summit. Zanu PF’s situation is worsened by Mugabe’s old age and
associated complications. Given that Mugabe is the glue keeping the party
together, the escalation of factionalism and succession problems is also
forcing them to rush to elections as a way of closing ranks and buying more
time in power.

The outcome of the Sadc summit is also important as it further shows Mugabe
has lost touch with regional and global realities, as well as his grip on
the region. It clearly indicates that except for the support of the Clown
Prince himself, Zambian President  Michael Sata, Mugabe no longer has
credible allies, especially given that Sadc chair Jose Eduardo dos Santos ––
the longest-serving leader in the region –– seems to have shifted to South
African President Jacob Zuma’s camp. This now explains why Mugabe did not
fight after the diplomatic defeat in Luanda.

If he chooses to defy Sadc and push himself further into isolation by
calling for elections unilaterally, that will be his quick way out.

What is further complicating things for Mugabe is that Zanu PF is also
seriously divided, not only on succession, but also on issues like
elections. There is strong resistance to elections within Zanu PF itself.
Hence the likely bhora musango (sabotage) approach will undermine Mugabe in
the next elections as it did in 2008.

While Mugabe has been subdued after Luanda, some Zanu PF elements have been
desperately clutching at straws after the collapse of their election plans
through misrepresentations and inept propaganda which have no takers.

This leaves us asking who is fooling who? In fact, the old saying “you can
fool some of the people all the time, and all of the people some of the
time, but you cannot fool all the people all the time” aptly captures what
is happening in Zimbabwe now.

Spurious claims like saying the GPA expired after two years and strange
arguments like the country must hold elections this year to clear next year
for the United Nations World Tourism Organisation general assembly
conference in August, for instance, won’t fly.

Then there is the dubious claim that the lifespan of parliament ends in
March next year when it is clear the duration  of parliament starts the day
the president iss sworn in, in this case June 29 2008, and expires five
years later. There is also a provision in the constitution that elections
must be held within four months after the expiration of the harmonised terms
of the president and parliament, meaning legally the last day for elections
is possibly October 29 2013.

So there is time to fully implement the GPA and adopt reforms, including
coming up with a new constitution, before the next elections. This is the
context in which Sadc leaders in Luanda made their resolutions on Zimbabwe.
Regional integration should be tied to democratic imperatives. As such Sadc
should keep Zimbabwe on track during transition from dictatorship to
democracy via free and fair elections.

Moyo is the director of policy and research coordination in the MDC led by
Professor Welshman Ncube. Email:   mdcpolicyguru@yahoo.co.uk

Eric Bloch Column: Banking sector crisis undercuts economy

http://www.theindependent.co.zw/

Thursday, 07 June 2012 17:32

THE instability that prevails in the banking sector is contributing
immensely to the economy’s inability to attain substantive recovery. While
the majority of banks are capitalised to an extent that assures their
continued operation without untenable risk to depositors, several continue
to teeter on the brink of collapse.

It is only a few banks whose continued existence is precarious and are
unable to assure depositors of the security of their deposits. Their
delicate situation makes Zimbabweans in general and business enterprises in
particular apprehensive over the viability of all banks and associated
financial institutions. This has resulted in many being reluctant to deposit
funds in banks opting to hold them at home.  In turn, this worsens the
illiquid economy further hindering any chance of them recovering.

Due primarily to the interventions of the Reserve Bank of Zimbabwe (RBZ)
which oversees the banks, most banks have recovered from the ills that
afflicted them in 2008 during the hyperinflation era, and in early 2009 when
Zimbabwe demonetised its currency and adopted the prevailing multi-currency
system. The RBZ vigorously monitored the banking sector and used its
authority to force recapitalisation of all those banks that had become
undercapitalised. The RBZ’s actions ensured banks attained prescribed
minimum capitalisation requirements to ensure the banks’ continued
operations, and their ability to timeously service withdrawals by
depositors.

As and when the RBZ deemed it fit, the prescribed capitalisation levels were
re-assessed and, when necessary, the RBZ dictated further bank
recapitalisation.

As a result most of the formerly troubled banks, which happen to be
locally-owned, achieved restoration of viability and security. Nevertheless,
the RBZ maintained a watchful eye on developments in the banking sector.
Despite this, some banks progressively eroded their capital resources and
became insecure havens for depositors’ funds.  This was, in the main, due to
mismanagement, entry into insecure transactions, ill-considered and insecure
lending among causes.

As a result, where it became evident to the RBZ that such banks were
increasingly unstable and not protected-against by capital adequacy to
support the levels of transactions entered into by the banks, there was no
alternative but for the RBZ to place them under curatorship, or merge them
so as to consolidate their capital resources. Illustrative of the
effectiveness of RBZ’s actions was the placing of Renaissance Bank under
curatorship, and its subsequent recovery.

Notwithstanding the commendable RBZ monitoring and supervision of the
banking sector, a few banks escaped the RBZ’s efforts until their negative
circumstances became serious.  Interfin Banking Corporation and Genesis
Investment Bank Ltd’s inability to fully service customer withdrawals is
evidence of this.

A major consequence of the instability that prevailed within the banking
sector over the last three to four years has been the reluctance of many to
deposit their funds in the banks.  That disinclination was intensified by
concerns that Zimbabwe would discontinue usage of the multi-currency regime
and revert to its own currency, concurrently with a forced conversion of all
foreign currency holdings into the Zimbabwean currency.

This has driven many to hold their funds outside the banking system despite
the attendant risks. The drop in deposits has exacerbated the inability of
banks to operate effectively and extend loans to customers except for
limited amounts and for short periods of time.

This has impacted adversely upon the long-awaited economic recovery. The
2008 hyperinflation and subsequent currency demonetisation resulted in
almost all enterprises being grossly undercapitalised.  Their capital was
severely eroded, and yet the funding needed to resume operations was more
than before the hyperinflation era.

To restore working capital levels to required levels the enterprises needed
access to enhanced banking facilities, and those facilities had to be of a
sufficiently long duration to meet operational needs. However the banks,
being recipients of only short-term deposits instead of medium and long-term
deposits, were only able to make advances only for very limited periods
falling short of the borrowers’ needs.

The inability of banks to extend sufficient loan facilities and provide the
funding for the periods of time required by borrowers has been one of the
major causes of business closures and the downsizing of many more.

The inability of banks to extend sufficient advances to meet the needs of
commerce and industry is compounded by their inability to access substantial
amounts of offshore lines of credit. International lenders have serious
reservations about making advances to Zimbabwean institutions.  Those
reservations are founded upon the oppressive indigenisation programme being
implemented by government, and the political and economic instability still
prevailing in Zimbabwe.

Because of the limited amount of lending banks can engage in, they have to
charge high interest rates on such advances to cover their operating costs.
However, those high interest rates are prohibitive for most enterprises,
whose limited viability ensures they cannot afford costly borrowings,
despite their desperate need for such.

Thus, despite the RBZs valiant efforts to address financial sector
instability the banks remain in a precarious situation.

Zim polls: Sadc contains Mugabe

http://www.theindependent.co.zw/

Thursday, 07 June 2012 17:25

Owen Gagare

THE extraordinary summit of the Sadc Heads of State and Government held in
Luanda, Angola, last week strongly re-affirmed the regional bloc’s stance
that Zimbabwe can only hold elections after full implementation of the
Global Political Agreement (GPA) and the poll roadmap, putting paid to
President Robert Mugabe’s bid to force polls this year with or without a new
constitution.
Paragraphs 6.9 to 6.11 of the communiqué released at the end of the summit
read: “On Zimbabwe, summit commended stakeholders for their commitment,
co-operation and efforts towards the implementation of the Global Political
Agreement and urged the parties to the GPA to finalise the
constitution-making process and subject it to a referendum thereafter.

“Summit also urged the parties to the GPA, assisted by His Excellency Jacob
G Zuma, President of the Republic of South Africa and Sadc facilitator of
the Zimbabwe political dialogue, to develop an implementation mechanism and
to set out time frames for the full implementation of the roadmap to
elections. Summit further commended the facilitator for his efforts towards
the realisation of full implementation of GPA.”

Although polls can theoretically still be held this year, given that the
Sadc Troika on Politics, Defence and Security Co-operation recommended that
polls be held within 12 months, insistence by the full summit that the GPA
and election roadmap be first fulfilled means polls can only practicably be
held sometime next year. The coalition government has up to now done little
to implement agreed reforms, leaving it with a substantial implementation
backlog.

The Sadc statement was a slap in the face for Mugabe and his backers who
were hoping regional leaders would support the push for early polls without
reforms outlined in the GPA. Before the summit, Mugabe launched a charm
offensive by dispatching envoys to regional leaders to back his plan for
early polls, arguing that time was ripe for elections since political and
economic stability had been restored in Zimbabwe.

He had also tried to convince regional leaders that it would be in Zimbabwe’s
interest to start 2013 on a clean slate without having to worry about
elections in a year when the country is co-hosting the United Nations World
Tourism Organisation general assembly with Zambia.

However, political analysts believe the writing was on the wall and Mugabe
was stretching his luck by asking regional leaders to back his proposal
which amounted to GPA repudiation.

Regional leaders had insisted at the highly-charged Livingstone (in Zambia)
summit, as well as Sandton (South Africa) last year and Windhoek (Namibia)
meetings in 2010 that an election roadmap be put in place first and that all
parties work to ensure polls are held in a free and fair environment to
avoid a disputed outcome.

Professor Eldred Masunungure of the University of Zimbabwe says Mugabe’s
request was akin to asking regional leaders to re-write the GPA and
disregard the region’s own principles.

“There was very little scope for Mugabe or Zanu PF to persuade Sadc to
change its position. Some of the issues are locked in the GPA, and changing
goalposts at this time would be re-writing the GPA,” he said.

“I think he was shooting in the dark. It was a gamble he was never going to
win. Sadc stuck to its guns and I’m sure it will continue sticking to its
guns because changing at this point would have fatally impaired the
credibility and sincerity of the regional leaders.”

Masunungure said although the summit tried to please all parties in the
inclusive government by taking into consideration their interests, the
message that came out was that the bloc did not want elections held this
year.

He said a fair-minded assessment leads to the conclusion that Sadc
disapproved elections in 2012, but would prefer them by mid next year.

“It seems Sadc is saying the architecture of elections will not be in place
by the end of the year,” he said.

Masunungure said the summit could have been more hard-hitting by declaring
that polls could only be held at a specific time, but chose to relax the
period to please all parties, hence Zanu PF’s insistence elections can still
be held this year since it’s within the 12 months timeframe.

The MDC formations now prefer elections when constitutionally due by June
next year, which is also within the Sadc timeframe.

“That’s the reason why publicly all the parties are claiming to be happy
with the summit despite their polarised positions,” said Masunungure. “But
the demand for infrastructure to be in place means elections can only be
held next year because the reforms cannot be done in six months. For
example, the delimitation exercise will take several months, and this will
only be done after a referendum which may be held in September,” he said.

Another analyst, Dr Joseph Kurebwa, said the Sadc summit was a success given
that regional leaders had tried to meet the expectations of all parties in
the inclusive government.

Kurebwa said Sadc had, however, sent a clear message that polls should be
held, but only after reforms had been adopted.

Dewa Mavhinga, the regional co-ordinator of Crisis in Zimbabwe Coalition,
said it was unlikely that Mugabe would ignore Sadc although there was a need
for Sadc to continue with its firm stance.

“Sadc has maintained consensus on the need for reforms in Zimbabwe ahead of
elections, dismissing Zanu PF’s calls for elections this year with or
without a new constitution,” said Mavhinga.

“It is unlikely that Zanu PF will ignore Sadc. However, the challenge of
Zanu PF’s resistance to reforms remains. As we in civil society shift our
gear to demand reforms urgently, we ask Sadc to also push for reforms to
pave the way for peaceful, free and fair elections.”

The summit also tasked Zuma with assisting the parties in coming up with an
implementation mechanism, but it remains to be seen whether Zanu PF would
implement the reforms it has purposely refused to honour since the formation
of the inclusive government in 2009, despite being a willing signatory to
the GPA. Zuma is expected in Harare soon for talks with principals on
elections.

Elections: 32 years of going nowhere?

http://www.theindependent.co.zw/

Thursday, 07 June 2012 17:22

By Mary Ndlovu

THIRTY-three years ago, the liberation war was reaching its denouement.  Ian
Smith’s ill-fated “internal settlement” had been rejected, South Africa
wanted an end to the war, and Zambia and Mozambique were suffering
intensifying Rhodesian raids.
Both wings of the Patriotic Front, Zanu and Zapu, felt a military victory
was near, but conditions in the region were unfavourable. However, during
the Lusaka Commonwealth Conference in August 1979 all parties agreed on a
conference to end the war and prepare for elections to introduce African
majority rule after 90 years of colonial domination.

In September the protagonists assembled at Lancaster House in London and by
December an agreement was signed on a ceasefire and a new constitution as
Zimbabwe anticipated its first “democratic” elections.

But could it be assured they would be “free and fair”? As this question is
topical in view of the next elections, it might be of interest to look at a
paper presented to the conference by the Patriotic Front.

Following a Southern Africa African Development Community (Sadc) summit in
Luanda last week, the country would start preparation for elections and it
would be useful to look back how far we have come since Lancaster House
talks to the current situation where we are once again talking about a new
constitution and elections.

The paper presented by the Patriotic Front was interesting. Titled
“Conditions for Free and Fair Elections”, dated October 25 1979, the paper
contained demands for free and fair elections or the conditions which must
exist before elections. Find below the excerpts:

Security

The primary condition for free and fair elections is peace and security in
the country, i.e. conditions in which every citizen can enjoy the
fundamental freedoms of the individual, and in particular freedom of
assembly and association, movement, expression, and freedom from harassment
and intimidation.  This can only be provided by security forces which are
impartial and in which everyone has confidence.

Hence the security forces during the interim period must be an army composed
of a combination of the Patriotic Front’s and the Regime’s armies and a
police force composed of a combination of the Patriotic Front’s and the
Regime’s police forces, operating in both cases alongside a United Nations
Peace-keeping force and a United Nations Civilian Police Force to supervise
the ceasefire and ensure peaceful integration.

Preparatory processes

These must include: the return of refugees, the release of political
prisoners, detainees and restrictees, and the abolition of protected
villages, and the resettlement of the persons concerned; the promulgation of
an electoral law; the establishment of an Electoral Commission; the
registration of voters; the delimitation of constituencies.

Campaigning

Parties must be able to campaign freely and in conditions of safety to
travel around the country; address meetings; carry out house to house
canvassing; assist people to register as voters.

Polling

There must be protection of voters to and from the polling station;
There must be freedom of the voter to cast his ballot for the party or
candidate of his choice;
There must be freedom of the parties to be in attendance at polling
stations;
There must be security of polling booths and ballot boxes both during and
after the voting;
There must be polling stations within walking distance of every voter.
Mobile polling stations will not be used;
Representatives of the candidates and the United Nations supervisors will be
present at all times at polling booths and during counting and
Voting will be one day only.

“The foregoing conditions for free and fair elections can only exist in a
situation free of war, martial law, state of emergency, and where there is
an impartial public service, army and police force,” the Patriotic Front
demanded.

“The electoral machinery (conditions) we have outlined is necessary in order
to prevent corruption, intimidation, economic pressure and other undue
influence on voters, people voting more than once, and other malpractices.”

Not all these demands, which are similar in some respects with what some
parties and civil society organisations are currently insisting on before
the next elections, were met.  The 1980 elections were supervised by the
British governor and his officials, with observers from Commonwealth
nations.

Joshua Nkomo reported numerous cases of intimidation and denial of freedom
of movement to Lord Soames, who failed to act. At one time though Soames
threatened to ban from the elections senior Zanu PF officials, including
Enos Nkala, for making inflammatory remarks but instead of desisting from
those activities the party reacted defiantly, warning it would go back to
war if that happened. Some even said Soames must choose whether he wanted
war or peace.

In the end, Soames did not act largely because the British were tired of the
protracted Rhodesian problem and wanted out.
However, Soames after the polls did day say how bad the situation was when
he remarked “I will never forget”, referring to violence and intimidation
during the elections.

That is why some now say those polls set a precedent, not for free and fair
elections, but for the use of violence, intimidation and ballot-rigging
during elections.

Thirty-two years later we seem no further ahead.  What was generally
necessary then is still required to lay the foundation for a true democracy.
Despite all the declarations and protocols, election institutes and minimum
standards, despite the array of non-government organisations educating
Zimbabweans and lobbying internationally, we have proceeded to 2012 without
progress on the electoral front.  And the country in many respects now lies
in ruins far more extensive than those returning refugees and fighters found
in 1980.

Will we have another 32 years before we move forward? Some believe that if
the United Nations instead of Britain had supervised the 1980 elections, the
result might have been significantly different, and we might have travelled
a different course as a nation. We cannot remake the past, but we can
reshape our understanding of it, and learn from our mistakes and failures.

As we face the next elections and another critical transition in our
history, the question is: will we have a credible and transparent electoral
process or we fail ourselves again in that regard as we did in 1980?

Mary Ndlovu is the widow of the late Edward Ndlovu, who spent his entire
adult life engaged in the struggle for freedom in Zimbabwe. He was active in
politics from the 1950’s as a trade unionist and during the ANC, NDP and
Zapu era. Detained with other senior Zapu leaders during the civil strife in
the 1980s, Ndlovu was also an MP and Deputy Minister of Energy before his
death in 1989.

Sata’s position on Zim incoherent

http://www.theindependent.co.zw/

Thursday, 07 June 2012 17:18

Pedzisai Ruhanya

WELL before his election as Zambian leader in September last year Michael
Sata was a supporter of President Robert Mugabe and his Zanu PF party,
notwithstanding previous foreign policy positions of his predecessors, Sadc
and AU concerns about lawlessness and, most importantly, the abuse of state
institutions by those in charge in this country to remain in power.
Sata is of the view that because Mugabe is one of the many Zimbabwean
nationalists who participated in the liberation struggle his leadership,
irrespective of egregious human rights violations, lawlessness, economic
ruin and stolen elections, should not be challenged.

Put simply, Sata thinks Zimbabweans should not exercise agency in how they
are governed and even if they do and democratically win elections, that
should be ignored.

Sata’s view of the Zimbabwean problem is not based on rational policy
positions but misguided nostalgic considerations of the liberation struggle.
Since he assumed power last year, Sata has not outlined any useful policy
positions that can persuade Zimbabweans to appreciate his approach.

Sata has publicly supported Mugabe since he came into power and actually
intensified this backing during the Sadc summit in Luanda, Angola, last
week. He supports Mugabe’s untenable position of having elections without
reforms as agreed under the Global Political Agreement (GPA), a move which
repudiates previous Sadc resolutions including those made in Livingstone in
his own country in March last year.

It is not clear why Sata is going against Sadc and AU positions on Zimbabwe
and why he continues to help undermine political and democratic processes in
the country. There must be an explanation though to this political madness.

However, Sata should realise the Zimbabwean problem has cost lives, the
economy and the people’s future in many respects. Zimbabweans have been
victims of systematic and widespread abuses under Mugabe’s rule. They have,
among others, been subjected to electoral malpractices, institutionalised
political violence, excesses of partisan security forces and attempts at
systematic indoctrination through abuse of the public media that work as
propaganda tools of Zanu PF. These are some of the issues Zimbabweans and
Sadc want resolved before the next elections.

In order to appreciate Sata’s position, it is critical to interrogate why
states take decisions that they do at the international level or adopt
certain foreign policies and what influences such positions. The theory of
realism as postulated by scholars such as Benjamin Frankel and Oona Hathaway
could assist unravel Sata’s position on Zimbabwe.

Realism scholars make critical assumptions about the world such as states
are the primary and most powerful actors in the international sphere; the
world is anarchic since there is no power over states and no state may
command another, there can be no order in international relations; states
seek to maximise their security power; the world has limited resources that
are evenly distributed and so they see states as primarily focused on
maximising power and security and that states behave rationally in their
pursuits of security or power.

In the majority of cases, when states make their foreign policies or sign
treaties with other states, they look at those realist assumptions with a
view to getting the best deals from such relations. If you audit the
position of Sata, it is difficult to see what he is trying to get out of the
problems in Zimbabwe by lending support to Mugabe.

The majority of Sadc leaders have taken a position on Zimbabwe based on
their national interests —  the need to protect their economies and citizens
from the influx of Zimbabweans, making the region politically stable and
therefore attract investment that could lead to expansion of their economies
through foreign investments, thus creating opportunities and employment for
citizens.

It is important to note there is a major division within the realism school
of thought regarding how states measure the maximisation of power. Under
classic realist theory states seek to make absolute gains in their power. A
realist state does not care whether other states gain in a transaction as
long as things go its way.

Could this be the position of Sata? If it is, then it is important for the
region and Zimbabweans to know what Sata intends to gain from supporting
Mugabe. In Zimbabwe, Sata supports what is unacceptable in his own  country,
everything he fought against in Zambia. This is oxymoronic behaviour.

Realist scholars tend to view the world as a series of prisoners’ dilemmas.
The classic prisoners’ dilemma involves two suspects arrested for a crime.
The suspects agree in advance not to say anything. The police interrogate
them separately and offer each leniency in return for a confession. If
neither suspect cooperates, they will only face a lighter sentence for a
lesser included offence.

If both suspects confess, they will both go to prison for the full crime
though they will get some leniency for their cooperation. If only one
suspect confesses, that suspect will get lenience while the other gets the
maximum sentence for the full crime. The best overall outcome for both
suspects is when both choose not to confess. For each individual the best
outcome is to confess while the other sticks to their agreement not to say
anything. If either suspect believes the other will cheat by confessing, it
is in their interest to also cheat and confess. Unless the two suspects are
incredibly committed to their agreement this prisoners’ dilemma tends to end
in both suspects confessing to protect themselves against worst possible
outcome and possibly obtain the best outcome.

The basic idea from the prisoner’s dilemma can be translated into the
international relations sphere. For example, states will follow the Third
Geneva Conventions (which protects prisoners of war and wounded soldiers) as
long as they believe other states will also comply. Yet if one state
suspects or knows that another state is violating the convention, that state
would be motivated to break the treaty.

In the Zimbabwean case, the majority of Sadc states support the GPA and the
Sadc principles and guidelines governing the conduct of democratic elections
which Zanu PF opposes. Apparently Sata is opposing these principles by
blindly supporting Mugabe.

The problem with realists is that they must find some benefit for states in
agreeing to and complying with international human rights  and  good
governance norms. Even if such a benefit could be found, realists would need
to show why there would be a strong incentive to cheat under the prisoner’s
dilemma.

Zambia as a member of Sadc and member of the Sadc troika should in the
interest of transparent and accountable leadership explain its policy
position on Zimbabwe.

Ruhanya is a PhD candidate on Media and Democracy Studies at the University
of Westminster, London.

Ballot mightier than the bullet

http://www.theindependent.co.zw/

Friday, 08 June 2012 12:34

IT is becoming increasingly clear President Robert Mugabe and Zanu PF,
backed by the state security forces and other instruments of repression,
want to plunge the country into early elections on their own terms and
repeat what they did in the past: use terror and manipulation of the
electoral process to get the outcome they want.
Although their noises and blatant misrepresentation of issues –– which have
reached alarming and desperate levels –– might appear like political
madness, there is however method to the madness. They are following a script
they have used before. The template is the same, except that they now
pretend they have renounced violence.

The plan is simple. Mugabe, backed by Zanu PF and state security hardliners,
want to wriggle out of the GPA and its key obligations and stampede the
nation into elections this year and then manipulate his way back to power.

While Mugabe and his loyalists are pushing the political agenda, the
security forces are playing their part: laying the ground for Zanu PF
campaigns through meetings with voters, mainly villagers, and issuing
partisan and threatening statements –– all this against the constitution and
the law. In other words they are doing this brazenly and unlawfully as they
have done in the past.

Mugabe’s pretexts to rush into elections, informed by his old age, health
complications, factionalism and succession dynamics within Zanu PF and his
mortal fear of being held to account for human rights abuses committed by
his regime, include claims that the GPA is illegal; it has expired;
elections are now overdue; the GPA was only signed to stop violence and thus
no causal link between it and constitution-making process; the inclusive
government constitutionally ends in March next year and that he has powers
to call elections under the current constitution, which implies abandoning
Copac.

There are many other shabby excuses coming from Zanu PF, including
conferences and even the weather. The same approach of sophistry and
obfuscation –– underpinned by lack of imagination –– is being used to create
smoke-and-mirrors over the outcome of the Sadc summit and troika meetings in
Luanda, Angola, last week.

It’s all about deception and manipulation –– which of course is clearly not
working. While their inept propaganda campaign is collapsing, it is the role
of the military which is disturbing. The military has now decided to fight
the constitution, the law and the people. The next elections will thus be
the bullet versus the ballot. After recent poisonous remarks by
Major-General Douglas Nyikayaramba and Major-General Martin Chedondo, among
many other senior military officers, there were shocking statements this
week by Major-General Trust Mugoba, showing security forces are determined
to unconstitutionally and illegally influence the outcome of the next
elections.

Addressing mourners during the funeral parade of Lieutenant-Colonel Thabani
Khumalo at Imbizo Barracks in Bulawayo this week, Mugoba said the army will
not allow rivals to Mugabe and Zanu PF to rule even if they win elections.

“Society must understand that the land reform and the indigenisation
programmes are part of our revolutionary history. As the military, we do not
only believe, but act in defence of these values and we will not respect any
leader who does not respect the revolution,” he said.

“We will not even allow them to go into office because they do not represent
the ideology we fought for. As the military establishment, we have an
ideology that is represented in the mission of Zanu PF.”

This is really scandalous; not least because these remarks are coming from a
senior army officer who seems to think that his bigheaded colleagues and
himself can willfully and brashly trample on the constitution and laws of
the country with impunity.

Quite clearly, if the rule of law was upheld, these soldiers would be up for
court-martialling on treason and other related charges. Elsewhere they would
be jailed or dismissed for such offences, a major threat to the
constitutional order.

By so doing they are undermining law and order, while fomenting an explosive
situation which can easily deteriorate into a flashpoint, with tragic
consequences. It is rather amazing and outrageous how senior army officers
can be so reckless and irresponsible. In democratic societies, they would
never get away with such behaviour.

Editor’s Memo: West playing into Mugabe’s hands

http://www.theindependent.co.zw/

Friday, 08 June 2012 12:30

Dingilizwe Ntuli

THE extent to which President Robert Mugabe attracts negative attention from
much of the whole world is amazing. Just like the beast in Revelations, it
would appear Mugabe has somehow managed to deceive the world to wonder after
him.

This is in no way meant to suggest that Mugabe is the prophesied beast in
the Bible, but the fixation with Mugabe sometimes only serves to divert us
from real issues which need urgent attention.

While the West needs no introduction to Mugabe’s beastly tendencies,
particularly his chequered human rights record, its handling of this emotive
issue has occasionally been rather disingenuous.

For example, last week the biggest story in Zimbabwe was Sadc’s insistence
that elections only be held at the conclusion of the constitution-making
process and completion of reforms outlined in the Global Political Agreement
(GPA).

The regional bloc’s bold stance was a major setback for Mugabe’s push for
elections this year without implementing electoral, political and other
reforms as agreed in the GPA his party signed.

In the run-up to the Sadc summit in Luanda, Angola, Mugabe went on a charm
offensive, dispatching several envoys to lobby regional leaders to support
his push for elections this year so as to ostensibly start 2013 free from
conflict-ridden election issues as Zimbabwe co-hosts the United Nations
World Tourism Organisation (UNWTO) General Assembly with Zambia in August.

Sadc leaders were not persuaded by this argument, and made their position
clear.

Probably sensing that its position on early elections would be rebuffed,
Zanu PF’s propaganda machinery went to work, with the feel-good spin in the
state media claiming Mugabe had been appointed a UN international tourism
ambassador.

Western media and human rights groups fell for the bait hook, line and
sinker so the outcome of the Sadc summit could have been overshadowed by the
West’s protest at the UN’s “bungling”.

So serious was the matter that Canada announced that it would boycott the
UNWTO General Assembly in protest, and has since done so.

In other words the Ottawa government took a major policy decision on the
basis of a non-event. No such appointment had been made. Mugabe was to be a
host but not an ambassador.

While the West is perfectly entitled to its opinions, moves such as that of
Canada can easily give Mugabe and his backers reasons to continue with their
anti-West rhetoric. That would be a shame, coming as it does at a time the
West is trying to mend relations with Zimbabwe as demonstrated by the recent
Brussels meeting with the EU. A more useful way of looking at the whole
issue is that it is Zimbabwe’s enduring conservationists, and not Mugabe,
who are being honoured.

Mugabe is no conservationist. Look at what he has done to the wetland in
Belvedere next to the National Sports Stadium in Harare. The area was
declared a wetland and African leaders, including Mugabe, planted indigenous
trees there in the 1980s. But Mugabe gave the land to the Chinese who are
building a hotel and a shopping complex there. His Tourism minister, Walter
Mzembi, is on record as saying “Since when did locusts and lizards take
precedence over a country’s development!?” So much for conservation!

Under Mugabe dozens of conservancies have been invaded and reduced to barren
land in the past decade, courtesy of the chaotic land reform programme.

Zimbabweans know this full well, hence the little or no debate over his
so-called appointment.

Western protests over the honour divert attention from the real issues ––
the use of violence and intimidation against Zimbabweans opposed to Zanu PF,
and the GPA’s reform implementation deficit.

The West must not be seized with this non-event because it plays into Mugabe’s
hands leaving ordinary Zimbabweans to bear the consequences.

It is instructive to remember that before the advent of democracy in South
Africa in 1994, Mugabe was the West’s “pointman” in Africa, in spite of his
gross rights violations. It was only after the inauguration of Nelson
Mandela as the former apartheid state’s first democratically-elected
president that the West woke up and suddenly started pointing fingers at
Mugabe as it leaned towards Mandela.

The West is better advised to expend more effort in helping ensure the next
elections are free and fair, not on some purported ambassadorial appointment
of Mugabe which does not exist in the first place.

dntuli@zimind.co.zw

Candid Comment: We have now become a nation of traders

http://www.theindependent.co.zw/

Friday, 08 June 2012 12:29

Itai Masuku

ELSEWHERE in this edition there is an article referring to a fantastic 1000%
plus growth in profit margins by one of the oldest brands in the local
furniture industry, Pelhams, and one of the strongest retail brands, OK
Zimbabwe.  There is an interesting comment by Pelhams’ management to the
effect that  the  company  would  continue   to pursue   its  strategy  of
importing  to  improve  supply  and  margins  due  to  high  costs of
production  locally.

The company’s management notes that the continued increase in local
production costs had a negative impact on margins, which reduced to 27%
against a prior year comparative of 30%.

OK Zimbabwe admitted to importing as much as 65% of their products from
South Africa and Asian countries including China. The quagmire that Pelhams
and OK find themselves in is the same quandary that most of our companies
face in Zimbabwe today: In order to make a profit you must import literally
the bulk of your products.

Even manufacturing firms, in order to bring down their input costs, also
have to import the same. We used to laugh when we used to hear that the
Senegalese imported bread from France.  How can people be so colonially
bamboozled, we thought. Alas, we sure could be heading in that direction. In
fact we did.

During the hyperinflation days we imported some of our bread from South
Africa, and the legacy from that era is the price of US$1 for a loaf of
bread today, even though there are some selling it profitably for half the
price.

An acquaintance who wholesales vegetables and other fresh produce at Mbare
Musika recently phoned me asking if I had any contacts in South Africa from
whom he could order onions. Onions? I asked bewildered. Yes, he answered.
There were none available locally and his competitor was importing from
South Africa, and that’s the same route he had to go.

Unbelievable, I remarked to myself. And yet this is the stark reality our
country is in.  Recently in this column, we wrote about Zimbabwe’s
ever-widening trade deficit, which according to the latest Reserve Bank
figures was a negative balance of nearly US$1 billion in the first quarter
of this year alone.

This implies that if the same pattern persists throughout the year, our
deficit will be US$3,6 billion, roughly the market capitalisation of the
Zimbabwe Stock Exchange. Seasonal exports like that of tobacco may bring
this down a bit, but given faltering mining exports, including that of the
controversial diamonds, it is highly unlikely that we will end the year
without an even greater deficit.

The demand for foreign products is relentless, partly to fill a gap in our
production and partly to offer price relief. We have tragically become a
nation of traders. That may help explain why, if one looks at the Old Mutual
stock market report elsewhere in this edition, the consumer or retail
counters are the ones which have had the least dip of 0,64%.

All other segments have taken more than a 10% knock, the commodities sectors
(agriculture -21,69% and mining-25,03%  being the hardest hit). Yet
agriculture and mining are supposed to be the mainstay of our economy.
Because of lack of capacity, be it financial, technical or political, we’ve
failed to take advantage of extremely high prices our commodities are
fetching on the international markets at present where gold is still on
record highs around US$1 600, platinum around US$1 450.

Average tobacco prices have improved substantially this year, fetching as
high as nearly US$5/kg for the top grades. However, because we’re no longer
producers, we’ve become a consumer nation.