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MDC-T threatens unity govt pullout

Friday, 11 March 2011 10:09

Wongai Zhangazha

PRIME Minister Morgan Tsvangirai yesterday threatened to pull out of the
shaky inclusive government after the arrest of Minister of Energy and Power
Development Elton Mangoma on corruption charges and the Supreme Court’s
nullification of the MDC-T Speaker of Parliament Lovemore Moyo’s election.

The arrest of Mangoma and removal of Moyo as Speaker of the House of
Assembly left the fragile coalition government in turmoil. Tsvangirai was
not consulted before Mangoma’s arrest. Before a cabinet minister is
arrested, the president’s approval is sought. Tsvangirai expected to be
consulted as he shared executive powers with President Robert Mugabe in the

Apart from the arrest of Mangoma and the removal of Moyo, Tsvangirai told
journalists at MDC-T’s Harvest House headquarters he could walk out of
government because of political violence, banning and disruptions of
political and other public meetings by citizens, hate speech, theft, and

Earlier in the day during Independent Dialogue Series discussion, Tsvangirai
had slammed Mugabe over his threats to grab foreign-owned companies, his
anti-sanctions campaign and renewed political repression.

The explosive crisis in government feeds Mugabe’s agenda of trying to
collapse the arrangement so as to stampede the country into early elections
in which the outcome would be pre-determined.

“We have reached a point where we are saying no more to confusion. Let us
agree that this is not working. Let us make arrangements that we go for a
legitimate election with a clear roadmap that (South African) President
(Jacob) Zuma has committed himself to draw up so that we can reach a
conclusion on this confusion,” he said.

“As far as we are concerned, the roadmap that Zuma has committed himself to
draw up is the only solution to this madness,” Tsvangirai said, evidently
rattled by Mangoma’s arrest and the Moyo verdict.

The arrest of Mangoma came as the Supreme Court nullified Moyo’s election as
Speaker of Parliament with immediate effect.

Tsvangirai took the gloves off and fiercely slammed some of the country’s
top judges, describing them as “politicians masquerading as judges.”  He
accused them of making political rulings and not guided by the law but
partisan politics.

“A judiciary which in the post-Dumbutshena and post-Gubbay era has largely
discredited itself by becoming a willing appendage of Zanu PF. Dubious and
pro-executive decisions have been made in this era, said the MDC president,
adding that he would not accept the courts trying to subvert democracy.

He insisted that the election Lovemore Moyo was lawful and legitimate and
this was confirmed by the election officer and Clerk of Parliament, Austin
Zvoma, in his affidavit filed in court. 

“What is common cause is that Parliament is a separate body, with its own
rules and regulations and the courts should not interfere with other arms of
the state namely, the legislature. This decision is a clear reflection of
the state of affairs on the bench.”

The premier said Mangoma’s arrest was Zanu PF’s attempt to obscure the
massive corruption that was taking place at the Chiadzwa diamond fields
where  US$300million in proceeds from the sale of the precious stones have
not yet been accounted for.

“For a long time, our side of government has demanded transparency,
especially on the issue of diamonds. In the past few weeks, Zimbabweans have
been shocked that there have been various concessions granted to companies
other than Mbada and Canadile. These include Anjin, which has been mining
for more than 18 months in partnership with the police and the army and has
not remitted any cent to Treasury.”

He said he was surprised how the army was involved in mining activities and
how new concessions were being granted without the scrutiny of cabinet
committees. Tsvangirai said the army had no business in meddling in
commercial deals, including mining.

“The public spat between the Minister of Finance and the Minister of Mines
and Mining Development over the $313 million reflects the lack of
transparency in respect of diamond revenues. That the Finance Minister has
to ask for details of diamond sales when the Zimbabwe Revenue Authority
should be at the centre of every sale reflects the opaqueness surrounding
the sale of diamonds,” he said.

Tsvangirai attacked the selective application of the law by the police after
they refused to investigate three official complaints of corruption
allegations against Local Government minister Ignatius Chombo.

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Mangoma arrested over US$6m fuel deal

Friday, 11 March 2011 10:15

Paul Nyakazeya

ENERGY and Power Development Minister Elton Mangoma was arrested yesterday
on charges of criminal abuse of duty and office arising from how he awarded
a multi-million dollar fuel tender to South African firm — NOOA Petroleum.

The deal is blamed for causing severe fuel shortages experienced early this
year although suppliers say at least three million litres out of five
million have already been delivered.

Police spokesman Senior Assistant Commissioner Wayne Bvudzijena confirmed
Mangoma’s arrest to the Zimbabwe Independent yesterday.

“He is behind bars,” Bvudzijena said.

“He was arrested for awarding a contract to a South African company to
supply US$6 million worth of diesel without going to tender,” he added.

Prime Minister Morgan Tsvangirai told journalists Mangoma was picked up by
plainclothes police officers around 8:45am yesterday from his Chaminuka
Building offices.

“His (Mangoma’s) arrest is nothing but a continuation of the calculated
assault on the people of Zimbabwe. The fact that a cabinet minister can be
arrested by a constable is a reflection of Zanu PF’s total disregard to the
basic tenets of decency,” Tsvangirai said.

The arrest was an assault on the Global Political Agreement, Tsvangirai

He said Mangoma, alongside Douglas Mwonzora, Munyaradzi Gwisai and Rodgers
Tazviona were all innocent victims of “a barbaric and senseless

Addressing journalists last month, Mangoma accused the National Oil Company
of Zimbabwe (Noczim) of misappropriating US$35 million and causing fuel
shortages in the country.

Mangoma said Zimra garnished US$35 million, which was in the country’s
strategic fuel reserves account, after Noczim gave the revenue authority the
green light to do so.

However, Mangoma was accused of breaching statutory requirements by
withdrawing US$6 million of debt redemption funds to pay the South African
company — NOOA Petroleum — for fuel supplies during the petroleum shortages.

“Noczim had stolen US$35 million of Zimra funds between February  2009  and
February  2010. This was a symptom of  malpractice   at Noczim,” Mangoma

He also claimed Noczim allowed Zimra to garnish the account that had funds
for the strategic reserves.

In December last year and January this year Zimbabwe experienced acute fuel
shortages. Mangoma said NOOA had offered five million litres of diesel.

“The ministry had in the meantime agreed with Zimra to stop the garnish and
make good the amounts due to the strategic reserve levy,” he said.

Minister Mangoma said US$6 million was paid into a Noczim account and
transferred into PetroTrade bank account.

He said there was a six-day delay in transferring the funds while the first
train to transport the fuel spent more than 10 days at Beitbridge Border
post awaiting clearance.

“The country has 500 million litres of storage facilities, which is more
than double those in Beira,” he said.

Analysts see Mangoma’s arrest as part of broader plan by Zanu PF to
frustrate the unity government.

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Parly Speaker loses post

Friday, 11 March 2011 10:20

Paidamoyo Muzulu

THE Supreme Court yesterday ruled that the Speaker of Parliament Lovemore
Moyo’s election into that position in August 2008 was not done in accordance
with the Houses’ Standing Rules and Regulations.

Chief Justice Godfrey Chidyausiku in concurrence with Justice Vernanda
Ziyambi and Justice Paddington Garwe ruled that speaker’s election did not
meet the strict sense of a secret ballot required by the law.

This followed an appeal by Zanu PF’s politburo member, then independent
Member of Parliament, Professor Jonathan Moyo. The ruling is the second
court victory in favour of him in as many months. Professor  Moyo last month
won a defamation lawsuit against vice president John Nkomo.

Yesterday’s ruling means Parliament is now expected to elect a new speaker
when it resumes sitting on March 22.

Professor Moyo appealed to the Supreme Court to have the speaker’s election
set aside saying  the election violated secret ballot rules as set out in
the Constitution and Standing Orders of Parliament.

Speaker of Parliament Moyo, from MDC-T, had won the ballot with 110 votes
against Paul Themba-Nyathi of MDC who garnered 98 votes.

“The inclusion of the irregular votes in the determination of the final
outcome of the Speaker constitutes a failure to comply with S. 39 of the
Constitution, as read with Standing Order 6, providing for the election of
the Speaker of Parliament by secret ballot, thereby rendering it invalid,”
Justice Chidyausiku said.

Deputy Chief Justice Luke Malaba and Justice Wilson Sandura, however, held a
contrary opinion and upheld Bharat Patel’s High Court dismissal of Jonathan
Moyo’s application as correct.

Malaba wrote, “I regret that I am unable to agree with the decision that S
39(2) of the Constitution, as read with Order No. 6 of the House of Assembly
Standing Orders, by implication compels the nullification upon proof, that
the Clerk of Parliament, who was under obligation to conduct the election of
the Speaker of the House of Assembly by a secret ballot, unlawfully counted
invalid votes as secret ballots.”

Sandura also disagreed with the majority decision saying  he opined framers
of the law had only sought to give protection to those who feared
victimisation for the choices they would have made.

Tsvangirai said the judgment did not respect the separation of powers within
the state’s three arms of government, namely the executive, legislature and

“What is common cause is that parliament is a separate body with its own
rules and regulations and the courts should not interfere with other arms of
the State, namely the Legislature,” Tsvangirai said yesterday.

Meanwhile, Chidyausiku yesterday refused Attorney General Johannes Tomana
leave to appeal against a High Court judgment acquitting exiled MDC-T
treasurer-general Roy Bennett of insurgency, banditry and terrorism charges.

Judge Chinembiri Bhunu discharged Bennett at the close of the State’s case
because the State had failed to prove a prima facie case against the
non-constituency senator.

Chidyausiku denied Tomana the right to appeal, saying the State’s case had
no prospects of success even when heard by the Supreme Court and, therefore
upheld the High Court ruling.

“I agree with the conclusion of the learned Judge in the court a quo that
this was a proper case in which a discharge in terms of s 198(3) of the
Criminal Procedure and Evidence Act (Chapter 9:07) was appropriate,”
Chidyausiku said in his ruling. “I see no prospect of the Supreme Court
coming to a conclusion different from that of the court a quo.”

Bennett was initially charged with providing money to Peter Michael
Hitschmann to purchase weapons of war to commit acts of sabotage, banditry
and terrorism in the country. However, the High Court discharged Bennett at
the end of the State’s case because no prima facie case had been proved
against the accused.

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Zanu PF, MDC-T squabble over elections

Friday, 11 March 2011 10:26

Faith Zaba

ZANU PF and MDC-T came out 180 degrees apart yesterday when they
contradicted each other on elections and a roadmap needed before credible,
free and fair polls can be held.

While MDC-T leader Morgan Tsvangirai said it was impossible to have
elections in 2011, Zanu PF spokesman Rugare Gumbo insisted that polls would
be held later this year after a referendum.

A few hours after Tsvangirai told business executives and diplomats at a
Zimbabwe Independent’s Independent Dialogue series session in Harare that
elections were not a possibility this year, Gumbo told the  Independent that
his party was already preparing for primary elections to be held in a month
or so ahead of harmonised polls later this year.

Tsvangirai said a referendum could only be held around September and it
would take another six to eight months to implement fundamental reforms
which would allow for a credible, free and fair election that can produce a
credible winner.

But according to Gumbo, the draft constitution should be out by May followed
by a referendum in June or July with elections being held thereafter.

Tsvangirai said: “Elections will be conducted in this country following a
process and that process is outlined in the GPA. There shall be a new
constitution; there should be a referendum and we sit down to determine the
date for the elections. Should anyone take a unilateral position to call for
elections without following that process, it is not legitimate. It will
never be credible. So far, a referendum should be done in September, from
September, we will decide when we will have elections. This side of the year
is almost impossible to have elections.”

However, Gumbo said:  “As far as we are concerned, the main issues are the
constitution-making process, if the constitution is produced and we have a
referendum, there is no way we cannot go for elections. Yes we will have
elections this year. If we have a constitution in place, what stops us from
having elections?”

In addition to the implementation of the 24 agreed principles in the Global
Political Agreement, MDC-T has 21 minimum conditions for a free and fair
election which they have presented to the Sadc mediator South African
President Jacob Zuma’s facilitation team to include in the roadmap to

These include drafting a new constitution, guaranteeing the security of
people, an end to violence, the introduction of a biometric voters’ roll, a
transparent and impartial delimitation process, full audit of electoral
processes, Sadc monitors six months before and six months after the
elections and security sector reforms and its realignment to prevent
political abuse by the military, intelligence agencies and youth militia.

It also wants media freedoms, prevention of Zanu PF abuse of state
resources, in particular diamonds in Chiadzwa, and an impartial and
professional Zimbabwe Electoral Commission.

Tsvangirai said it was impossible to implement all these issues before
elections can be held this year.

“There are a lot of things that need to be done before that elections Is
Zec ready with the voters roll? All that has to be in place, and it needs
six to eight months. This side of the year is almost impossible and I am
being frank, it makes 2011 not possible to have elections.”

He said they were working closely with South Africa on the roadmap to
elections. However, Zanu PF says there is no need to draft another roadmap
outside what is outlined in the GPA, hence the decision not to present its
proposal to the South African facilitation team.

“Why should they (negotiating team) submit their proposal when it is in the
GPA? The roadmap is in the GPA and you want to change that roadmap which is
in the GPA. What was the purpose of GNU? It was formed to produce a new
constitution which will lead to elections,” Gumbo said.

“The GPA is what guides us and that is what we stand by in Zanu PF. Where
will it come from and done by who?”

Asked about the implementation of the 24 agreed issues and statements form
South African that elections could not be held this year, Gumbo said Zanu PF
would only implement what is relevant for elections.

“There are some issues that should not stop us from holding elections. There
will be reforms of the electoral system and they are doing it right now.
Media reforms are being done right now. It’s neither here nor there to have
more radio stations and that can’t prevent elections,” said Gumbo.

“If we have a constitution in place, what stops us from having elections.
The South Africans have their perspective and we have our own perspective
and our perspective is to follow what is in the GPA, that is what we
implement. South Africa is our ally, we work together but they can’t just
force us to do something. We are a sovereign state.”

Gumbo said Zanu PF was in the process of preparing its rules ad regulations
for elections and after approval by the politburo, would set a date for
primary elections.

He said the new regulations would include none imposition of candidates and
a ban on canvassing using the president’s name.

“Once they are out and approved by the politburo, we can start on the
primary elections. The possibility of this next month is there. We can’t
rule it out. Everything is being worked out by the commissariat as well as
the legal department. Once we announce the rules and regulations and the
president says yes, we will go for primary elections even if the
constitution-making process is not complete.”

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Sanctions lobby ‘excuse to collapse GNU’

Friday, 11 March 2011 13:29

Paidamoyo Muzulu

ALTHOUGH President Robert Mugabe’s anti-sanctions petition launched at a
rally last week has been widely dismissed as an election gimmick aimed at
measuring his Zanu PF party’s mobilisation strategy, political analysts have
warned that this could increasingly be used to collapse the inclusive
Oxford scholar and historian Blessing-Miles Tendi cautioned that Zanu PF was
subtly using this anti-sanctions rhetoric to constructively dismiss the two
MDC formations from the wobbly coalition government.

Tendi said Zanu PF was unnerved by the current coalition arrangement and had
resorted to antics it hoped would push the MDC formations out of the
inclusive government. This, he said, is because the former liberation
movement lacked the guts to walk out of the Sadc-brokered agreement binding
the three parties to govern by consensus until fresh elections are held.

“Sanctions will prove most useful to Zanu PF for propaganda purposes. They
will use the existence of sanctions to avoid implementing reforms,” said

Mugabe and his Zanu PF party have been reluctant to implement outstanding
issues of the Global Political Agreement (GPA) and have tied their
resolution to the lifting of the US and European Union (EU)’s restrictive
measures and assets freeze.

Zanu PF is adamant that all outstanding GPA issues, which include media,
electoral, constitutional and security sector reforms, the appointments of
the Attorney-General, Reserve Bank Governor and provincial governors, should
be resolved simultaneously with the removal of the US and EU sanctions.

Such actions and attitudes, Tendi reckons, were likely to trigger the
collapse of the two-year inclusive government, but no party was ready to
shoulder the blame for such an outcome. He said the most the MDC could do
under such provocation was only to protest by boycotting cabinet and not to
capitulate by pulling out.

“Zanu PF would rather have MDC break the power-sharing government by walking
out, but the MDC is also aware that breaking away from the government would
sour its relations with Sadc,” Tendi said.
African Reform Institute director Trevor Maisiri said the anti-sanctions
campaign would further strain relations in the inclusive government.

“The government will experience further acrimony and discord. There is also
the likelihood that Zanu PF may use it as a perfect excuse to terminate the
GPA, which gives life to the coalition government,” said Maisiri.

The two MDC formations have taken a lot of flak from Zanu PF spin doctors
who accuse the parties of being Western puppets.

Even Herald columnist Nathaniel Manheru, widely believed to be Mugabe’s
spokesperson George Charamba, seemed to buttress this notion in his column
last Saturday when he described the MDCs’ absence from the launch of the
Zanu PF petition as a public relations disaster.

Manheru opined: “The campaign keeps the nation engaged, keeps it focused on
a potential election agenda item, indeed keeps the nation thinking within a
Zanu PF framework.”

Zanu PF managed to rope in business and religious groups to sing the same
anti-sanctions chorus. Religious leaders such as Emmanuel Makandiwa, Paul
Mwazha, Trevor Manhanga and Nolbert Kunonga all attended the party’s
anti-sanctions rally and sought to outdo each other in displaying their

Mwazha, a bishop of the estimated one million member strong apostolic faith
sect, set the tone for his fellow “men of God” when he openly declared that
he was a Zanu PF member.

Not to be outdone were some members of the business community who declared
their abhorrence of “sanctions” imposed on the country and later dined with
the Zanu PF elite.

Crisis in Zimbabwe Coalition programmes manager, Pedzisai Ruhanya, said Zanu
PF was of the mistaken view that amassing by coercion or voluntarily, the
two million signatures the party seeks would place it on a higher moral
ground as representing the aspirations of the majority.

“The anti-sanctions petition is part of Zanu PF’s bankrupt electoral
narrative,” Ruhanya said. “It is a party seeking relevance, and part of that
also includes the indigenisation rhetoric”.

Mugabe once again upped the stakes by securing another public backing of the
country’s service chiefs. Defence Forces Commander General Constantine
Chiwenga led the security chiefs in signing the Zanu PF petition.

The security forces wield great sway in the present Zimbabwe body politic
and their public show of support for the octogenarian ruler and his party
creates room for potential confrontation similar to that shown on the eve of
the 2002 presidential election.

The late commander of the ZDF, General Vitalis Zvinavashe, declared that the
security forces would not salute anyone who did not have liberation war
credentials, thereby guaranteeing Mugabe’s uninterrupted rule by hook or

Mugabe has portrayed the two MDC formations’ absence from the Zanu PF
petition launch to be a subtle reminder to all and sundry that the MDCs were
against the implementation of the GPA in its entirety and, by extension,
against the people of Zimbabwe.

Prime-Minister and MDC-T president Morgan Tsvangirai said his party had no
obligation to attend a Zanu PF function where people were coerced to attend,
but was quick to reiterate his previous sentiments that he would continue to
co-habit with Zanu PF despite being wary of the new wave of political
violence engulfing the country.

“We urge Sadc, the African Union and the international community at large to
keep an eye on Zimbabwe. The country risks sliding over the precipice if the
guarantors of the GPA do not take immediate action to come up with a binding
roadmap as a precondition ahead of the next election,” Tsvangirai said.

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Shaky GNU: Tsvangirai speaks out

Friday, 11 March 2011 10:47

Bernard Mpofu

PRIME Minister Morgan Tsvangirai yesterday  spoke out on a number of issues
affecting the inclusive government, focusing on the controversial
indigenisation policy, anti-sanctions campaign and the state of the fragile
inclusive government.

He warned that there was need to minimise internal conflict and
contradictions to save the coalition arrangement.

Tsvangirai spoke in detail about these issues while addressing business
executives and diplomats at the Zimbabwe Independent’s Independent Dialogue
Series in Harare. He addressed the delegates on the topic of discussion,
“Does the GNU mean Business?”

The prime minister said his party would push for democratic reforms,
security-sector reforms and economic stability before the two-year old
transitional government calls for an election.

He distanced himself from Zanu PF’s anti-sanctions campaign, saying he had
done his part but had been sabotaged by President Robert Mugabe and his
party. Tsvangirai said while he had many frustrations in government, he
would stick in there.

However, Tsvangirai called for a press conference three hours after meeting
captains of industry  where he threatened to pull out of the coalition
government over arrest of Energy minister Elton Mangoma and the Supreme
Court’s ruling overturning the election of MDC chairman Lovemore Moyo as
Speaker of the House of Assembly, escalating political violence and banning
and disruptions of party meetings.

Tsvangirai earlier dealt with Zimbabwe’s culture of impunity, indigenisation
regulations and failure to fully implement the Global Political Agreement
(GPA), a power-sharing pact signed in 2008 after a contested bloody

“A coalition government of our nature which has been formed as a result of
power-sharing negotiations is not a perfect arrangement,” Tsvangirai said.
“So some of the expectations have to be realistic. We have stated that in
this power-sharing government, the MDC is in government but sometimes it has
limitations of governance.”

“We will stay in there with the limitations and frustrations that we face.
We will have to make do with the opportunities that arise. But certainly it
is a frustrating arrangement.” The prime minister however changed his
attitude after Mangoma’s arrest and threatened to withdraw from government.

Tsvangirai, mandated by the GPA to formulate and implement government
policy, said conflicting statements from the shaky coalition would offset
Zimbabwe from achieving full economic recovery after experiencing a decade
of economic meltdown which ended after the consummation of the power-sharing

He said the inclusive government had failed to “live up to its catalytic
function” of ushering democratic and economic reforms.

“There are elements of collaboration and competition amongst the parties in
the same government. But our colleagues in this government have chosen to
compete more than collaborate, thereby compromising the capacity and unique
potential of this government in setting the foundation for a new Zimbabwe,”
he said.

In what appeared to be a response to Zanu PF’s intention to takeover
platinum miner Zimplats and food giant Nestlè, Tsvangirai said government
would stick to revised indigenisation and empowerment regulations. Zanu PF
has in recent days threatened to seize the two companies after accusing them
for contributing little to the fiscus.

“Let me assure you that while the programme of indigenisation and
empowerment has been approved by Cabinet, there is no government policy to
nationalise or expropriate businesses. All we want is that ordinary
Zimbabweans be empowered not a few elites,” Tsvangirai said.

Government revised the indigenisation and empowerment modus operandi after
business and civil society warned that the new law would trigger capital
flight and ruin the economy. The law compels foreign-owned companies with a
net asset value of US$500 000 or more to dispose 51% controlling interest to
capital-starved black Zimbabweans.

With liquidity affecting performance of the country’s capital markets, the
MDC-T leader warned that indigenisation and empowerment regulations would
enrich politically-connected individuals and result in increase unemployment
levels estimated to be over 80%.

When asked by ZB Holdings CEO Elisha Mushayayakara on whether government was
ready for empowerment, Tsvangirai distanced his party from the initial
crafting of the law nearly seven years ago. He said the MDC had merely
“mitigated the excesses” of the regulations, which were revised  mid– last
year after a furore within and outside government. The prime minister said
MDC’s efforts to amend the regulations were like “coating sugar on a
poisoned pill”.

He cited the scrapping of a section which criminalised investors’
non-compliance with the regulations and the replacement of the term “cede”
with disposal of companies. Critics however maintain that more changes have
to be made on the empowerment law.

“In 2004 Zanu PF enacted a law on indigenisation and that law as you would
imagine was politically driven,” he said. “That law stayed unsigned for
almost four years which means that even Zanu PF was actually hesitant in
implementing their law.

Even President Mugabe was shocked to hear that if you don’t comply you would
be sentenced five years in jail. If you are going to attack businesses, most
of which are multilateral operations at a small scale, again you are
actually destroying the goose that is laying the eggs.”

He attacked Youth Development, Indigenisation and Empowerment minister
Saviour Kasukuwere for announcing empowerment regulations before briefing
Cabinet on findings of the 13 sector-specific committees that were last
August commissioned to gather input on preferred indigenisation thresholds
on different sectors of the economy.

“We also realised that this 51% was just an aspiration, that’s why we said
the minister should go back and come back with minimum thresholds, industry
by industry. He has not come back yet, he is just making noise. So as far as
I’m concerned, Cabinet has not yet adopted minimum thresholds for companies
and until such a time he comes up with minimum thresholds for sectors, it is
against the law,” Tsvangirai said.

“I don’t know how Mr Kasukuwere is going to enforce taking over 51% because
he doesn’t have that legal position. This is done for politics and for
political rhetoric which then spoils the idea of empowerment.”

The MDC leader said President Mugabe had on Monday made a U-turn on taking
over platinum miner Zimplats. Tsvangirai saidPresident Mugabe told him there
were no plans to grab Zimplats, but admitted he had a personal grudge
against Nestlè. This was ahead of Tuesday’s investment conference which the
president later snubbed.

On security-sector reforms, Tsvangirai said his party had no leverage to
hold the country’s state security apparatus accountable.

“Your co-ministers of Home Affairs have no power and control over the
commissioner-general. If they want to give instruction to the
commissioner-general, they have to do it in writing but the
commissioner-general reports to the president and the president can give
instructions to the commissioner-general verbally.  Even if you give your
written instructions, they may be overturned by a verbal instruction. That
is the complexity of the arrangement,” he said.

He cited a unilateral ban and subsequent lifting of restrictions on MDC-T
meetings ahead of an elective congress in May. Tsvangirai described the
confusion on who had imposed the ban as a “circus” in the coalition after
President Mugabe professed ignorance on the action.

While complaining that government was riddled with policy contradictions,
Tsvangirai said one of the only few issues where inclusive government had
found common ground was in tackling the opaqueness surrounding diamond
mining in Marange. Reports show that Zimbabwe has to date sold US$313
million worth of diamonds.

“We need to reconcile the figures from Zimbabwe Mining Development
Corporation to what is entitled to the fiscus. There is no argument there.
In that instance there is collaboration between the two ministers and that’s
how it should be,” he said.

Turning to elections, Tsvangirai said Zimbabwe risks political isolation
from the international community, capital flight and famine should Mugabe
unilaterally calls for an election before reforms.

The power-sharing arrangement call for the three political government in the
inclusive to push for democratic reforms that include drafting a new bill of
rights, security-sector reforms and a referendum before the next poll.

“Elections will be conducted in this country following a process and that
process is outlined in the GPA,” he said. “Should anyone take a unilateral
position to call for elections without following that process, it is not
legitimate. It will never be credible. So we will be back to square one.”

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Netone to engage in foreign partnership

Friday, 11 March 2011 10:46

Taurai Mangudhla

GOVERNMENT-owned mobile phone operaor Net One is close to establishing a
strategic partnership with a foreign player, chief executive officer Reward
Kangai said this week. But he stopped short of saying the partner would be
not South African mobile network MTN.

Kangai told delegates at the just ended Euromoney Zimbabwe Investment
Conference that a partnership deal with an undisclosed partner was at an
advanced stage and would be concluded by the end of the year.

“Netone was affected by sanctions because it is owned by government.
Government should create room for private players and facilitate business
growth. They should not own business but instead earn revenue from taxes,”
said Kangai.

“We commend the government’s decision to allow us to get a strategic
partner. This business is capital intensive and the levels of capital
required cannot be met by Zimbabwe alone,” he added.

Kangai indicated that the mobile operator had been hard hit by economic
stagnation in the past decade and required huge capital to unlock value
through maximising on economies of scale.

If facilitated properly, the strategic alliance would make Net One
competitive at a regional and global level, he added.

Net One holds 20% of Zimbabwe’s mobile marketshare and requires investment
of between US$50 million and US$100 million every year to attain required
growth and sustainability.

He urged the government to create the right environment for business to
partner with operators that have a global footprint.

Kangai’s call comes at a time global market trends have seen players merging
to maximise on economies of scale.

Netone’s average annual revenue per customer is US$420 for contract
subscribers and US$120 for prepaid customers.

The company’s revenue growth could improve if it secures capital to invest
in new technology such as the third generation network. Net One currently
operates on second generation mobie phone technology.

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Mugabe, Gaddafi tight business pals

Friday, 11 March 2011 10:45

Chris Muronzi

ONE of embattled Libyan president Muammar Gaddafi’s sons, Saadi, was in the
country last August to seek business opportunities.

According to reports, he was taken to the Tokwe-Mukosi Dam in Masvingo where
he promised to make a sizeable investment in the dam’s construction.

While governments worldwide have extended a blanket freeze on Gaddafi and
Libya’s assets, Harare has been quiet on developments unfolding in the North
African nation let alone an asset freeze.

Gaddafi and President Robert Mugabe are largely seen as pals. However, the
Arab strongman’s investments in Zimbabwe are paltry.

Even trade between the two countries is negligible. According to Zimtrade
export figures, Zimbabwe exported only US$390 000 worth of goods to Libya
from 2005 and 2009.

A Zimbabwe Independent investigation revealed that the Libyan Foreign Bank
owns 96,6 million shares which is, around 14,12% of CBZ Holdings Ltd’s total
issued share capital while Government of Zimbabwe holds 110 million
translating to 16,08% of the banking group.

Libya also owned around 14% of Rainbow Tourism Group’s total issued share
capital but disposed off the holding sometime back.

The latest top 20 shareholder register obtained from RTG’s transfer
secretary confirms the Libyans exited the group and do not appear on the top
shareholders list.

But in 2002, Zimbabwe received oil from Libya under a US$360 million loan
facility that was to be repaid partly by the supply of farm produce to
Tripoli. The deal collapsed after Zimbabwe failed to meet its side of the

The oil deal, which covered 70% of Zimbabwe’s fuel needs at the time, had
run for less than a year at the time it was ended.

Desperate to salvage the facility, in 2003, Zimbabwe attempted but later
abandoned a plan to export US$100 million worth of agricultural commodities
to Libya.

The deal had involved the Libyan Arab Foreign Bank, the Libyan Arab
Investment Company and Libya’s state oil company, Tamoil. After the deal
collapsed, government handed over the CBZH stake to the Libyan Foreign Bank.

The shareholding is worth around US$15,2 million at CBZH’s current  market

Apart from public-held investments, Gaddaffi is also believed to  have vast
business interests in Zimbabwe.
A court case in August last year, where a former ZBC employee was accused of
defrauding the Libyan government of US$4 million, also helped give a glimpse
into the Gaddafis other private businesses in Zimbabwe’s real estate and
transport sectors.

The former ZBC staff — Stanley Masendo — was accused of siphoning the money
from a company known as Crieff Investments, which later changed its name to
Aldawlia Investments.

The company, according to reports bought 12 haulage trucks and properties,
which included 10 flats in Harare, which were left under Masendo’s

In 2002 there were unconfirmed reports that President Mugabe’s wife, Grace,
had sold her mansion in Harare’s Borrowdale to Gaddafi.

While these could be about Libya’s known or suspected holdings in Zimbabwe,
across the border to the South, the Libyan government’s investment arm
co-owns a slice of Sandton — Africa’s most expensive real estate — in
Johannesburg as well as a large chunk of property at the V&A Waterfront.

The Libyan government’s investment arm, the Libyan Investment Authority, was
established to plough Libya’s vast oil earnings into an array of investments

Through the Libya Africa Investment Portfolio, the authority owns the Libya
Arab African Investment Company (Laaico), which has a stake in South Africa’s
tourism, leisure and real estate sectors through its 100% shareholding in
Ensemble Hotel Holdings.

Ensemble owns the Five-star Michelangelo Hotel in the heart of Sandton and
has a minority stake in Legacy Hotel Holdings, which owns the adjacent and
equally imposing Michelangelo Towers, and Raphael Penthouse Suites, Da Vinci
Hotel, another opulent properties.

Through various financial institutions, Libya has spread its wealth across
at least 35 nations on four continents. The country owns a bizarre mix of
investments, ranging from luxury real estate and publishing companies in
Britain, to hotels in the Middle East and a small stake in Italy’s Juventus
football franchise.

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Tempers flare at investment conference

Friday, 11 March 2011 10:36

Bernard Mpofu

TEMPERS flared on the opening day of the Euromoney Zimbabwe Investment
Conference in Harare when the Zimbabwe Mining Development Corporation
chairman Goodwills Masimirembwa and Zanu PF campaigner Christopher
Mutsvangwa clashed with British ambassador Mark Canning over the European
Union and United States targeted sanctions.
The verbal assault on the British envoy was triggered by Masimirembwa’s
criticism of the restrictive measures for straining the operations of local
state-owned enterprises, parastatals as well as choking the fiscal space and
growth of the mining sector.

The ZMDC is one of the few state-owned entities on the EU and US sanctions
list and Masimirembwa said operations were being hampered by the measures
because the US-based Office of Foreign Assets Control (Ofac) had blocked
US$2.9 million in diamond and gold sales made by ZMDC.

“We cannot make a payment as ZMDC anywhere in the world because that money
will be blocked by Ofac. That is the instrument that the US uses to
frustrate the mining operations of the ZMDC, Minerals, Marketing Corporation
of Zimbabwe and their subsidiaries,” said Masimirembwa.

“That money is coming into the fiscus for the benefit of the people of
Zimbabwe. So to say that the sanctions are targeted at the president of the
Republic of Zimbabwe and or some of his ministers is simply not being
honest. It is intellectual dishonesty because the truth of the matter is
that the money that comes to government as a dividend has a purpose of
enhancing the budget, enhancing the capacity of the minister of finance to
pay civil servants,” he said.

Canning shot down Masimirembwa’s comments as “political nonsense” saying the
EU’s targeted sanctions on the ZMDC were justified.

Said Canning: “I find it deeply depressing that you should take the presence
in Harare of many eminent foreign businessmen to feed them self-serving
political nonsense. ZMDC is on that list because its operations are
distinctly not transparent. The EU, Britain and America are open for
business as far as Zimbabwe is concerned. If British companies are unable to
do business here, it has nothing to do with the so-called sanctions. It has
got to do with a range of other factors which I won’t go into.”

That is when Mutsvangwa leapt to Masimirembwa’s defence and angrily accused
Canning of interfering in Zimbabwe’s internal affairs.

“The Union Jack, the flag of the British Empire, Mr Ambassador was lowered
in 1980. We are a sovereign people. There is absolutely nowhere in the
United Nations where your country arrogates itself the right to decide what
goes on about revenues in Zimbabwe. We don’t do that on your companies in
the United Kingdom,” said Mutsvangwa.

Confederation of Zimbabwe Industries president Joseph Kanyekanye calmed the
situation by urging Zimbabwe and its former colonial ruler’s representative
to engage constructively on the matter.

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No going back on Nestle takeover — Kasukuwere

Friday, 11 March 2011 10:33

Tatenda Macheka

THE Minister of Youth Development, Indigenisation and Economic Empowerment
Saviour Kasukuwere is digging in his heels over the planned compulsory
acquisition of food processing company Nestle Zimbabwe, insisting that
nothing will stand in the way of plan.

“What’s so special about Nestle? We are going to indigenise that company
because it is in the sector reserved for investment by Zimbabweans already,”
said Kasukuwere.

Nestle, which produces milk powder and cereals for the local market, was
first threatened with indigenisation in 2009 after it stopped buying milk
from Gushungo Dairy Estate, a company owned by the First Family.

However, Kasukuwere’s pronouncements were shot down by Prime Minister Morgan
Tsvangirai who said the type of indigenisation Zanu PF wanted to ram through
was illogical because it was against the law and the minister was aware of

“Cabinet has not adopted any sector by sector thresholds and Kasukuwere
knows that. Cabinet told him to come up with minimum thresholds for sectors
and he still hasn’t come back to cabinet with this,” said Tsvangirai at the
Independent Dialogue, a business forum attended by leading business
representatives and members of the diplomatic corps in the capital

Tsvangirai said President Robert Mugabe had admitted to him that the Nestle
issue was a personal grievance when the two met in Harare on Monday, ahead
of the Euromoney Zimbabwe Investment Conference.

“I told him that Nestle is not the factory that you see out there but a
patent, which is more important than the factory because they can easily
shut down that plant. I said if you have a problem that they are not taking
your milk because your milk doesn’t meet their standards, why don’t you talk
to Nestle so that you are given the technical support to meet the
 standards,” said Tsvangirai.

Tsvangirai said the 51% Zanu PF wanted multi-national companies to cede was
just an aspiration because such demand for existing operations and for new
investments would scare investors away from the country.

“I don’t know how Kasukuwere will enforce taking over 51% because there is
no law and policy which supports such a move,” Tsvangirai said.

After Nestle was threatened with indigenisation, it submitted a draft
empowerment proposal which Kasukuwere’s ministry rejected. The company
submitted a revised draft in November 2010 and is still awaiting the
minister’s response.

Nestle’s Corporate Communications and Public Affairs Manager for Equatorial
African Region, Brinda Chiniah said: “Nestle Zimbabwe submitted to the
government an indigenisation plan which would ensure the continued viability
of the company. Like other companies operating in Zimbabwe, we have
submitted our proposal in time, and we are waiting for the government to
publish the recommended guidelines by the Manufacturing Sectoral Committee.”

Despite repeated threats of a takeover, Chiniah said Nestle would continue
to operate within the laws of the country and the implementation of the
indigenisation would determine the expansion of the company.

Nestle is also adamant that it had adhered to the government’s empowerment
aspirations by identifying, nurturing and supporting local milk production.

Nestle’s major beneficiary is Lovemore Mugabe of Hwedza, who is the company’s
biggest milk supplier. It extended a loan to Mugabe to purchase 165 heifers
and an additional electricity generator, and the company said it would be
distributing a further 200 dairy heifers to new farmers soon.

Nestle is just one, among 400 American and British-owned companies that
President Robert Mugabe threatened with indigenisation at the launch of his
Zanu PF anti-sanctions petition last week.

Fears abound that the government’s indigenisation campaign will further
enrich the “usual suspects” with close links to the Zanu PF elite at the
expense of the ordinary masses as has been the case with previous deals.

However, Kasukuwere cited the example of the Schweppes Empowerment
transaction in which management and workers took over the running of the
company from Coca Cola as the type of indigenisation the government was
aiming at fostering.

“Remember, indigenisation and empowerment entails making opportunities
available to all our people, the land reform being a case in point. We are
basically extending the programme to all sectors of the economy,” Kasukuwere
told the Independent.

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Sipepa Nkomo attacks MZWP

Friday, 11 March 2011 10:31

Brian Chitemba

WATER Resources and Development Minister Samuel Sipepa Nkomo has launched a
blistering attack on the Matabeleland Zambezi Water Project Trust for
resisting a forensic audit of government funds that were injected into the
project over the years.

The fight over the audit, Nkomo told the Zimbabwe Independent ,will now be
referred to Cabinet, which will decide the way forward on the investigation
of the Matabeleland Zambezi Water Project (MZWP).
Nkomo alleged that his office had over the past year ceased trying to access
a trial balance from MZWT, chaired by Zapu president Dumiso Dabengwa.

The trial balance, the minister said, is required by the Comptroller and
Auditor General’s office, who will then hire a private audit firm to check
on how government funds that were released through the Reserve Bank of
Zimbabwe were utilised. The audit, according to Nkomo, will check on what
has been done since the inception of the project. Audited accounts would
then be tabled in Cabinet.

But analysts say the audit fight is part of a wider tug of war between MZWT
and the Ministry of Water Resources and Development over control of the

“Dabengwa doesn’t want to cooperate because we have been persuading MZWT to
release the trial balance but in vain,” said Nkomo. “Without the information
from MZWT, then we can’t have the audit. What are they hiding?”

The funds released to MWZT for the implementation of the project were
channeled in local currency before the era of runaway inflation but much has
not been done. Officials close to the project said only a foundation for the
first phase of the project – the Gwayi-Shangani Dam was constructed.

Nkomo said the audit would allow the complete takeover of the project from
MZWT by the Water Resources and Development ministry, which has already
announced the grabbing of the ambitious project that was mooted in 1912.

He said at least $1,2billion was required for the project although funding
remains a major stumbling block from kick-starting the water scheme aimed at
solving Matabeleland region’s water woes.

Repeated efforts for the past two weeks to get a comment from Dabengwa were
fruitless as he was said to out of office while his mobile phone was not
reachable. But MZWP chief executive officer Sarah Ndlovu promised several
times to respond to questions but had not done so at the time of going to

According to MZWT officials, when the project was planned in 1912, it was
budgeted at £6 000 before rising to £60 000  in 1932 and to £600 000  in
1952. The Zimbabwe government took over the project in 1993 and Dabengwa has
since then been the chairperson of the MZWT.

“As the chairman, Dabengwa has tried to seek funding but nothing much has
been done. The project has not taken off on a serious note mainly due to
poor funding,” said a source close to Dabengwa.

The source said since the 1990s, the project has been used as an election
campaign tool mainly by Zanu PF only to be dumped after polls.

Economic analyst Erich Bloch said if implemented, the MZWP would bring to an
end the perennial water problems Bulawayo, Matabeleland North and South face
as well as boost manufacturing, tourism and mining even in other parts of
the country.

“Major funding is required because minimal funding cannot bring the project
into being. The water project will benefit the whole of Zimbabwe and all
sectors of the economy,” he said.

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Zanu PF hooligans invade Unki Mine

Friday, 11 March 2011 10:29

Wongai Zhangazha

SUSPECTED Zanu PF war veterans and youths invaded Anglo American PLC
Platinum’s Unki Mine in Shurugwi yesterday  demanding a 51% share of the
company as the seizure for foreign assets intensifies.
The suspected Zanu PF supporters who numbered between 50 and 100, visited
the mining area in the early hours of the morning.

According to a source, the supporters arrived at the mine displaying
posters that carried pictures of Zanu PF Shurugwi-Zvishavane senator and
Minister of Foreign Affairs Simbarashe Mumbengegwi.

“The Zanu PF supporters came from surrounding areas that include Chachacha,
Chironde which are under chiefs Nhema and Shurugwi. I understand they lodged
a request to demonstrate against Unki Mine to the district administrator and
they were granted,” said the source.

He said management was notified of the demonstration by the Zanu PF
supporters on Wednesday evening.

“The Zanu PF supporters barricaded the main entrance to the mine by placing
branches and logs in the road. They were demanding 51% shares of the company
by the community and that 56% of the workers be from the local community.

“They had Zanu PF posters which they were sticking at the entrance which
carried a picture of Shurugwi- Zvishavane senator Simbarashe Mumbengegwi.
It is suspected that he might be the man behind the demonstrations,” said
the source.

He further added that 10 trucks  that had arrived to take ore for processing
to South Africa had to use another entrance to the mine and this stalled
business in the morning.

The source said the mob was rounded up by police from Shurugwi police
station by mid afternoon.

Unki Anglo Platinum human resource manager Revai Zireva confirmed the
invasion but said he was not in a position to comment and referred questions
to Anglo Zimbabwe chairman James Maposa.

However Maposa’s phone was not reachable at the time of going to press.

Zanu PF spokesperson Rugare Gumbo said he was not aware that supporters of
his party had invaded Unki Mine, adding that it was impossible for
individual villagers to run such a big company.

Police Spokesperson Wayne Bvudzijena said he was not aware of the
developments and said he would need to check with police on the ground.

Last week at the launch of the anti- sanctions petition, President Robert
Mugabe threatened to seize companies from countries that he said had imposed
sanctions on his party.

Some of the firms he threatened to nationalise include Rio Tinto and
Anglo-American and banks like Standard Chartered and Barclays.

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No end in sight for wage war

Friday, 11 March 2011 09:55

By Linda Tsarwe

SINCE dollarisation,there has been a raging war between employers and
employees as the latter have demanded what the former term  unsustainable
wage increases.

Employers’ associations and workers’ unions have been deadlocked over wage
increases as the two have consistently failed to agree on a rate of increase
that will represent a win-win situation for both parties.

Most companies have blamed the high wage bill as a reason for their tight
profit margins.For instance  Barclays Bank staff costs for the year 2010
constituted 62% of the total operating costs. Employees, on the other hand,
have responded that they are not earning living wages.

In what can present  difficulty to any arbitrator, the two sides both have
strong cases to defend their positions.  For the employees, current wage
levels are not able to meet even their basic requirements.

According to the National Statistical Agency, the poverty datum line for
December stood at US$467.  The average Zimbabwean is earning way below this.
Civil servants’ salaries for example, average US$186.  The bulk of ordinary
Zimbabweans are deprived of  most basic of things.

The main burden that households have been facing has been the increase in
utility bills.  Recently, Zimbabwe Electricity Supply Authority (Zesa)
announced that  it was owed US$450 million in outstanding electricity bills
by households and corporates as of end of year 2010.

One can put up an argument for the consumer that it is not that he is
unwilling  to pay, but his level of disposable income has incapacitated him
from honouring some of his monthly  obligations.  Of course, we cannot run
away from the fact that the service offered by Zesa is poor and can result
in bill payment resistance by the public.

Worsening the situation, Zesa had recently been authorised by the Zimbabwe
Electricity Regulatory Commission to increase its tariffs by 30%, much to
the ire of income strained consumers.  Had it not been for the protests of
consumer pressure groups, which resulted in the increase being shelved,
households would have faced a 30% inflated utility bill end of February.

In addition to high utility bills, other escalating costs like school fees
have also led to employees demanding a higher wage.  For a civil servant
with children in school, a rented apartment, utility bills and food
purchases, a US$150 wage for the month can only do so much.

Inflation has been on the rise with the month of January recording
month-on-month inflation of 0,9% and an annual inflation rate of 3,3%.
Generally, the price levels for food has gone up significantly from the 2010
festive to date. The Consumer Council of Zimbabwe (CCZ) January basket for a
family of six stands at US$509,17, which represents a 2% increase from the
month of December.

All this, together with other increases in costs, continues to put pressure
on the consumer, who in turn finds justification for demanding a wage

The employer has an outcry of his own.  It has become the norm for workers’
unions and employers’ unions to fail to reach consensus on wage increases.
Usually, the spread between the rate demanded by workers’ unions and
employers’ associations is huge, being a clear indication that both the
employer’s and the employee’s needs are at different levels.

For example, when the Zimbabwe Banking and Allied Workers’ Union (Zibawu)
initially went to the bargaining table with the Banking Employers
Association of Zimbabwe (Beaz), the former was demanding a 130% increase
against a 5% increase that had been awarded by the bank employers.

Most employers are arguing that businesses have not yet resuscitated to an
extent that they can meet such wage demands from employees.  Further, most
companies have stated that the bulk of their costs are emanating from
finance costs and wages.  It would be difficult to push wages further as
this would threaten profitability, or worsen loss positions.

Companies like Willdale, for example, have been suffering from low capacity
utilisation due to lack of funding.   For its financial year ended 30
September 2010, capacity utilisation stood at 23%. Low production has
resulted in depressed revenue.  It is a daunting task to reverse the company’s
losses and wage pressure is a further threat to that drive.

The banking sector has also been struggling due to low levels of liquidity
which have resulted in cases of uneven distribution of deposits.  Faced with
such difficulties, employers have indicated their inability to offer the
substantial wage increases which the employee has been demanding.

Therefore the war goes on.  Both employer and employee have strong cases to
back their arguments.  However, some of the issues need to be dealt with at
macro level where utilities and education, for example, can be made
affordable for the consumer.

Issues such as lines of credit and foreign direct investment will also need
to be addressed to provide funding for various companies so as to improve
their capacity utilisation levels.  This represents the best hope for the
employer improving his standing to award satisfactory wages.

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Barclays dismisses indigenisation concerns

Friday, 11 March 2011 09:50

Paul Nyakazeya

BARCLAYS Bank Zimbabwe has hit back at President Robert Mugabe’s threats to
seize the financial services group, claiming the institution was already
indigenised and was taking further measures to raise the level of
President Robert Mugabe last week instructed Indigenisation and Empowerment
minister Saviour Kasukuwere to look into the takeover of the British-based
bank and its counterpart Standard Chartered Bank.

Barclays MD George Guvamatanga told analysts in the capital this week that
Barclays Zimbabwe was the first bank to indigenise when it offered 30%
percent of its shares on the Zimbabwe Stock Exchange in 1991.

“We became a public company. We issued 30% of the company’s shares to
Zimbabweans. Foreigners were not allowed to participate on the (stock)
market then. That was done intentionally with the intention to empower
Zimbabweans,” Guvamatanga said.

Responding to questions during the bank’s analysts briefing, Guvamatanga
said although his bank was the first to indigenise in the country,
shareholders had nonetheless submitted a further indigenisation proposal to
the indigenisation and empowerment minister.

Barclays was still awaiting a response from Kasukuwere, said Guvamatanga

He said the indigenisation issue was a sensitive shareholder concern.

He said Barclays Plc, the bank’s controlling shareholders, had complied by
submitting a proposal to the indigenisation and empowerment ministry.

“We (Barclays Zimbabwe) have submitted our (indigenisation) proposal and are
awaiting a response from the relevant ministry,” Guvamatanga said.  “We
however remain focused and are looking forward to celebrating 100 years of
doing business in Zimbabwe next year.”

Barclays Bank, Standard Chartered Bank, Nestle, Zimplats are some of the
foreign companies that are being targeted for takeover.

Market analysts have expressed concern over how the exercise would be
executed amid fears the programme might benefit a few politically connected

The indigenisation regulations compel foreign owned companies to dispose
controlling shareholding to indigenous Zimbabweans.

The bank is confident it will reverse its loss position after introducing a
voluntary layoff exercise management hopes will lift the bank back to

The bank registered an after tax loss of US$1, 3 million in the full year to
December 2010, translating into a loss per share of 0,06 cents per share.
Operating income was US$25,6 million, up 67% on the prior year. Total costs
wereUS$27,5 million excluding the US$6,5 million paid out as severance
packages in the bank’s layoff exercise that saw 206 employees exiting the

Guvamatanga said the bank should start seeing benefits of the staff
rationalisation from the second half of the year going forward.

He said: “The Board is confident of reversing the loss trend after specific
initiatives were adopted, including a voluntary retrenchment scheme during
the financial year, with benefits starting to be realised from the second
half. Further work to optimise processes, product range and distribution
channels are being pursued in 2011.”

However, staff costs remained the major component, amounting to 53% of total
costs. Management hopes the benefits of the 2010 restructuring exercise will
be felt within two years.

Guvamatanga said the bank was focused on enhancing its product offering and
right-sizing financial services in order to position the financial
institution better.

In the same period, Barclays’ capital adequacy ratio was 24% ahead of the
regulatory minimum of 10% while a liquidity ratio of 72% was recorded ahead
of the regulatory minimum of 10%.

The loan loss ratio remained within 1%, showing a high quality loan book.
This is well within regulatory thresholds.

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GDP must reach US$15bn before Zimdollar returns

Friday, 11 March 2011 09:48

Bernard Mpofu

FINANCE minister Tendai Biti says Zimbabwe has to grow its economy to US$15
billion and bolster its current account position before bringing back the
now redundant local currency.

This task for government, which is targeting a Gross Domestic Product of
US$9 billion by 2015, could signal the extended use of the multiple currency
system adopted in 2009. The finance ministry is projecting a 9,3% GDP growth
this year.

Biti this week told business leaders in the capital that government was
working on a paper that would review the multi currency system adopted two
years ago to stop unprecedented hyperinflation.

He said the paper, which treasury expects to complete by year end, would
outline whether government would maintain the prevailing payment system or
consider joining the Rand Monetary Union.

“At the moment our current account is a disaster. We are importing three
times more than we are exporting. A negative current account cannot sustain
our local currency,” Biti said.

“Secondly, the issue is foreign currency reserves. We won’t be able to
return to the Zimbabwe dollar unless we have a GDP of US$15 billion.In the
medium to short term, the benefit of abandoning the Zimbabwe dollar far
outweighs costs associated with not having a monetary policy.”

Official figures show that total exports last year grew by 25% to US$2,5
billion on the back of increased mineral and agriculture sales while imports
were estimated at US$4 billion.

The adoption of multiple currencies, which has resulted mainly in the use of
the greenback, the South African Rand and the Botswana Pula, has left the
central bank with limited control on money supply and inflation.

With no exchange rate for the Zimbabwe dollar, the cost of labour, which
Biti said was relatively higher compared to regional peers, had become the
“new exchange rate” for the country, adding that labour costs had
contributed to the collapse of the local textile industry.

“Because we no longer have an exchange rate for the Zimbabwe dollar, the
cost of labour has now become the exchange rate. Any investor wishing to
invest in the country now has to look at the cost of labour. It costs ten
times more to produce a pair of shoes in Zimbabwe than it costs in China,”
he said.

On lower denominations, Biti said government would soon make a “major
fundamental announcement” amid reports that the United States government has
agreed to supply coins currently in short supply.

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IMF team to discuss US$7 billion Zim debt

Friday, 11 March 2011 09:46

Bernard Mpofu

ZIMBABWE’S US$7 billion external debt will next week come to the fore when a
visiting International Monetary Fund (IMF) team meets treasury and central
bank officials in the capital, a top government official has said.

The IMF mission will be on routine Article IV consultations that appraise
economic policy issues between the multilateral institution and government.

Finance minister Tendai Biti this week told delegates attending the Zimbabwe
Investment Conference organised by United Kingdom-based Euromoney
Conferences that Zimbabwe, currently saddled with a ballooning debt, has to
tackle its dues before sustainable economic growth could be realised.

The Finance minister sees the economy growing by 9,3% this year, buoyed by
anticipated resurgence in mining and agriculture. Biti further said he had
undertaken to treble income per capita to US$1 200 within the next three

But experts say the country’s run-down infrastructure, which was established
from funds mainly sourced from the BrettonWoods institutions, would slow
down economic recovery.

Zimbabwe’s current external debt, owed to multilateral financiers, both the
Paris Club and non Paris Club members, represents 103% of the country’s
gross domestic product.

“An IMF team on Article IV consultations meetings will be in the country on
March 16 and key discussions will be on debt,” Biti said.

“If someone were to ask me what are the two urgent things that Zimbabwe has
to deal with — I would put the issue of debt and the resolution of our own
political difficulties at the epicenter,” he added.
He said Zimbabwe had since 1997 “lost a decade” after it failed to access
development funds from multilateral financiers due to arrears.

He said government would push for reforms that would restore Zimbabwe’s
eligibility to access development funds from the traditional creditors.

The World Bank, according to Biti, had plans to increase its funding to
Africa to US$30 billion in the next five years but Zimbabwe might not
benefit from the funds unless it committed itself to tackling its  debt.
“We lost a decade from 1997 to 2008 and we can’t afford to lose another
decade. We have to join the party,” he said.

The cash-strapped government, currently generating nearly US$200 million
monthly in revenue, adopted the Zimbabwe Accelerated Debt and Development
Strategy — a hybrid method combining traditional debt servicing methods and
strategic use of mining resources — as a way of clearing the debt.

This came after a proposal for Zimbabwe to apply for the IMF’s Highly
Indebted Poor Countries (HIPC) status reached a stalemate within government.
The HIPC status, which was adopted by neighbouring Zambia, provides for debt
relief from the IMF for countries that accept to adopt stringent macro-
economic stability measures.

Apart from this debt servicing strategy, treasury also set up a debt
management office in its quest to rid what has become an albatross to the
coalition government.

Last year the IMF, which concluded consultations on March 17, advised
government to restore stability in the banking sector. The recommendation
included the Ministry of Finance restoring the central bank’s lender of last
resort function.

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Cross the bridge or jump into the abyss

Friday, 11 March 2011 13:35

By Eddie Cross

I SPOKE to a friend who works for one of the aid agencies in Harare and
asked if we had succeeded in confusing her at last. She laughed and said
that we had. Now if she is confused by Zimbabwe, with all her resources and
information and the analytical capacity available to a person in her job,
then the rest of us should be stumbling in the dark.

But the reality is actually quite simple in its basic elements. The Global
Political Agreement (GPA) government is not working, economic recovery has
slowed and we simply cannot go on much longer like this. That is a fact, we
either resolve our differences, work together to find a solution, or we
start to slide backwards into the anarchy we left behind in 2009.

The second reality is that we are all out of time. Suddenly President Robert
Mugabe is mortal; the implications are far reaching for all of us and
especially for Zanu PF, which is hopelessly fragmented.

Thirdly, we are all tied into the GPA process by our leaders; signatures and
the political commitment of the region and the AU as a whole. This means
that whether we like it or not we either walk across the GPA bridge or
abandon the process and jump off into the gorge below.

One thing is sure for all of us — we are on the GPA bridge and our
collective future depends on our willingness to continue the walk to the
other side that we started  in February 2009. We cannot go back, none of us;
this is the only way forward as the jump into the gorge is not really an

The only group here that wants to risk the jump are those who know that once
we get across the bridge there is no future for them there, only uncertainty
and insecurity.

This group includes all the real hardliners in Zanu PF as well as key
military and security figures. They want an Egypt solution — chaos on the
streets, an ungovernable state, a leap off the bridge and if they survive
the fall into the river below, regroup and form a new government that will
be a flimsy disguise for a military junta.

They do not give a damn about the welfare of the people, they fear and
despise democracy and trust only themselves. They think that in an unholy
alliance with international crooks and thugs and the rich natural resources
here, they can get by very well.

Those who do not like it can and will leave, eventually resulting in a tiny
population governed by an oligarchy like Burma or Guinea, protected by
powerful friends who profit by exploiting our isolation and resources.

As I write, the South African facilitators are in town again. They are
talking about how to get this collection of arguing, infuriating people to
stop quibbling and get on with the walk across the bridge. Their efforts
have been complicated immeasurably by Mugabe’s sudden frailty and there is a
new sense of urgency. A changing of the guard is now more certain than ever
and it is only a question of how and when, and perhaps, who?

Despite all our efforts we are still only about one third of the way across.
The GPA road map envisaged that by now we would be over the bridge and
conducting elections for new leadership for a new era. Instead we are stuck
and not even in the middle.

Let’s just have a quick look at what we have to do before we can say we have
crossed over this Jordan. First is the issue of a new constitution to
determine the shape and operations of the new state.

We have consulted the people, a flawed process, but nevertheless it did
clearly state certain fundamental national requirements — a devolved state
with perhaps five provincial governments, reduced powers for the president
who will govern without a prime minister, a stronger, more independent
parliament and greater independence for key commissions.

I think the two main parties can agree on most of this and a new
constitution should not be difficult to negotiate ­— and it will be
negotiated, the idea of a people driven process is simply not going to work,
that is for next time. What we will almost certainly end up with is a
compromise document that will form the basis of a new transitional
government to be formed after an election.

By itself, the constitution will not deliver a free and fair election that
is not open to dispute. This is the stated goal of the South African team
and is attainable. What is needed is for the new electoral commission to be
given full control of the process, sufficient funding for what is required
and for a new staff at the commission to replace the CIO/military
establishment that has run elections here for the past decade.

If it is decided to go for  harmonised elections, then we will need a new
voters roll. The present roll is totally and irrevocably compromised. The
Registrar General’s office has been playing games with the roll for so long
I do not think even they know who is on the roll anymore. It has six million
voters — at least two million are dead (including my father who is still on
the roll despite being  dead for 20 years) — and goodness knows how many are
absent from the country.

We have at least four  to five  million Zimbabwean adults abroad or in other
African states. Urban and young voters are understated and thousands of
people who qualify as citizens under the amendments to the present
constitution have been deregistered.

Once we have a new roll, then we need a new delimitation exercise conducted
by an independent and apolitical authority under the guidance of the
Zimbabwe Electoral Commission. I am quite sure that this will reverse the
relationship in numbers between urban and rural constituencies — in my view
the present ratio of rural to urban voters is 1:3. Such a shift would have a
profound impact on the electoral outcome as every Zanu PF leader

We need peace and total control of political violence. Believe me, Zanu PF
can turn on and off the violence in five minutes. They have done it in the
past and only they have the mechanism to do so. The recent upsurge in
violence is totally at the behest of the Zanu PF leadership and they must be
persuaded that this is not only unacceptable, but it’s unproductive and not
in their interests.

We need international observers in here — months before and after the
elections. Then we need a decent election, observers in every polling
station, a transparent ballot, a counting and reporting system as laid down
in new electoral regulations that are under discussion right now.

The trouble with such a road map is that it has nothing for Zanu PF after
the bridge has been crossed. They would be defeated in such an election and
by such a wide margin that they might cease to exist as a viable political
entity. The only way to avoid that is to go for a presidential election
only. This would leave Zanu intact in the House and force a new president to
work with them in the formation of a post GPA government.

The adoption of a roadmap that leads to such an outcome would have many
advantages . Zanu PF would be more prepared to work with the MDC on a new
constitution that was compliant with the people’s wishes. It would take less
time — we would not need a new voters roll or delimitation and the interests
of Zanu PF, including security, would be met by negotiation on the
composition and shape of the new administration.

    * Eddie Cross is an MDC MP for Bulawayo South. This article was taken
from his website

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Army, police still serving Zanu PF

Friday, 11 March 2011 13:33

By Martin Rupiya

THE mandate for the government of national unity (GNU), signed between
Zimbabwe’s rival parties in February 2009, was clear; restore legitimacy to
the country’s political system, foster economic recovery and provide
security for both the transitional state and ensure public safety, all in
preparation for free and fair elections.
Furthermore, given the acknowledged partisan nature of the existing
institutions, the transitional government was also expected to lay the
foundation for a multi-party democratic political system, including a
complementary security system.

With the GNU’s end being heralded by a cacophony of calls for new
elec­tions, now is the moment to evaluate whether or not the preconditions
for free and fair elections have been met: that is, the delivery of public
and state security, and the undertaking of security sector reform.

In making this assessment, it is important to distinguish between the
complementary tasks of re-establishing the environment of safety and
security, and attending to the role, tasking and composition of the security
sector. It is also important to reflect on the need for changes to a
legislative framework that has so far encouraged impunity, and the need to
provide judicial recourse to victims, both now and in the future.

As Joice Mujuru — the second secretary of Zanu PF and the country’s vice
president — recently pointed out, the country does not wish to continue to
be saddled with a partisan police force or security sector, nor does it wish
to be identified as one where harassment and murders by state organs are the
norm, with citizens reduced to “sleeping with one eye open” for fear of
being harassed.

It should also be noted that the GNU’s inauguration was preceded by a
mendacious approach to the question of command and control of security
ministries and organs by Zanu PF. Even before the Sadc-adjudicated sharing
of ministries had been completed, Zanu PF grabbed all the “hard” ministries,
leaving the MDC-T saddled with the “empty” portfolios: the ministries of
Finance, Education, Labour and Health, among others.

The then Sadc-appointed arbiter, former President Thabo Mbeki of South
Africa, failed to convince Zanu PF to observe the provisions of the
agreement it had signed. Only one ministry, Home Affairs, was co-designated
to ministers of both Zanu PF and the MDC-T in an unwieldy experiment that
has proved difficult to effect.

As a result, because Zanu PF “appropriated” exclusive command and control of
the security ministries, there is now an even heavier burden on its
shoulders, away from what would have been an even-handed judgment on the
triumvirate principals leading the GNU.

While the GPA provided for a review of ministries after six months, Zanu PF
has continued to maintain exclusive control of the “hard” security sector

The same is true of the institutions where interaction has remained with the
commanders reporting to the president and commander-in-chief, amid obvious
public stunts designed to belittle the office of the prime minister.

Hence, despite the requirement that command and control of the security
sector be shared during the transition, these have remained exclusively in
the hands of Zanu PF.

Secondly, the GPA provided for the establishment of a National Security
Council (NSC) to supersede the Joint Operational Command (Joc), a body that
has been associated with stifling democratic space and the arbitrary arrest
and harassment of members of the political opposition and the public.

The hope was that this would transfer security policy responsibility to the
jurisdiction of the three principals. However, while the NSC Act was passed
in March 2009, in practice there has been little or no meaningful change in
terms of the president’s exclusive dominance over security issues.

Furthermore, apart from a reported reluctance to host NSC meetings, it has
also emerged that no substantive security issues have been placed before the
NSC when it meets. Instead, decisions continue to be taken outside the forum
of the three principals and, much more worryingly, the discredited Joc has
continued to operate as a parallel structure.

Finally, as the country prepares for elections, some senior Zanu PF
officials have publicly adopted warmongering language, calling for the
setting aside by military means of any election result if it were to lose
the poll. These three points set the scene for us to look towards Zanu PF
and not the GNU principals when asking whether or not security has been
provided during the transitional period.

The first point of departure must be an acknowledgement that the GNU has in
fact delivered on its mandate on the security question.

Certainly more could have been done, but there is evidence of progress in
delivering a secure environment. This has allowed for a political and
economic resurgence since the near-total collapse of the economy and the
illegitimate political system that emerged after June 2008, which was
shunned even by the Sadc and the AU.

Certainly more can and should be done, but the important foundation has been
delivered. This assessment is not blind to the grabbing of the “hard”
ministries and the passing over of the NSC, which has not exactly served its
primary purpose and exists parallel to the Joc.

In order to predict the future structure of the security sector in Zimbabwe
beyond the transitional period, it is instructive to look inside the
competing factions within Zanu PF itself.

In this, we note the tension between two competing camps in Zanu PF: one
that is prepared to use force and discount any influence of the ballot box,
and another that is cognisant of faltering political support, not prepared
to use illegal means of holding onto power, and therefore seeking to adopt a
more moderate, conciliatory and democratic approach.

The analysis could discern which of the factions was on the rise at
different points in the life of the transition as this manifested in the
relationships between the principals.

Consequently we see a schizophrenic approach to normalising the situation,
and while there remains a willingness to do more at policy level there has
been only minimal change at the institutional level.While we acknowledge
progress, the security institutions cited in the GPA as partisan and working
to influence the political process in favour of Zanu PF are still intact.

They continue to act as spoilers and have surreptitiously deployed members
for political work in preparation for further violence in the upcoming

Even more significantly, Zanu PF has used the GNU’s transitional period to
continue to deny the mainstreaming of the command and control of the
security sector by the three principals.

As a result, the sector has remained in the exclusive control of one faction
that may or may not win the next election, provoking yet more predictions of
a return to the pre-GNU levels of violence, insecurity and instability.

Given the interest of Sadc and the AU in stability and free and fair
elections in Zimbabwe after the transitional period, this finding may well
serve as a clarion call for urgent and direct engagement with the actors in
order to resolve the impasse thorough negotiations.

There are several issues that, combined, convince us that more urgent
attention should be paid to security sector reform (SSR) in Zimbabwe. The
first, for purposes of consolidating the country’s national
security, is a precondition for stable political and economic relations:
policymakers must continue towards establishing the balanced civil-military
relations that are conducive to stability and development.

Second, there is a need to address the institutional reforms agreed to in
the GPA, including issues around national service, recruitment, civic
education and human rights law training, as well as refocusing the security
sector from a partisan role, embracing a more inclusive and effective
national security council and doing away with the Joc.

As things stand, there is a lack of confidence and rapport between civil
society and the uniformed forces in their civil-military relations.

Third, there is a need to bring into line economic resources allocated
towards defence and security, in a country emerging from damaging political
polarisation and economic crisis. Because of the residual nature of the
conflicted relations with the international community, including financial
institutions with sections of the GNU, Zimbabwe is surviving on a cash
budget with no direct foreign budget support.

As a result, there is need for serious justification of the finite resources
in order to respond to genuine national needs.

    * Dr Martin Rupiya is executive director of The African Policy and
Research Institute. He once worked briefly in Prime Minister Morgan
Tsvangirai’s office as a security director.

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Eric Bloch: Devious anti-sanctions campaign

Friday, 11 March 2011 13:26

IT was Sir Walter Scott, the renowned author who lived from 1771 to 1832,
who said: “O what a tangled web we weave, when first we practice to
 deceive!”  Although that was written more than two centuries ago, it is
still apt, as evidenced by the  deception exercise launched in Zimbabwe last

A bevy of Zimbabwe’s political hierarchy, of Zanu PF ilk, launched its
anti-sanctions petition campaign with more razmataz and vigour than ever
applied by it before in addressing the needs of Zimbabwe and its people.  In
doing so, much political misrepresentation, deception and distortion was

Key to the deception was the recurrent contention that the causes of
Zimbabwe’s very pronounced  economic morass are the sanctions imposed by the
US, the EU, various Commonwealth countries, and some others.

This contention is not of new origin, but was vociferously and repeatedly
expressed by the pre-Government of National Unity (GNU) political

Although devoid of substance, and the reality being that the immense array
of economic ills that have afflicted Zimbabwe was due to the policies and
actions of that pre-GNU government, at no time has there been any hesitance
to allege, with intense conviction, that those sanctions have occasioned the
economic distress which has caused endless suffering to the populace.

In launching a campaign to obtain more than two million signatures to
petition for the discontinuance of the sanctions, the campaign’s proponents
sought to justify their claims of the economy’s decimation by emphasis upon
the December 2001 enactment in the USA of the Zimbabwe Democracy and
Economic Recovery Act (ZDERA), and upon some similar sanctions imposed by
other states.

They highlighted, with intense emphasis, that ZDERA obliges US to apply veto
powers to the advances of any funding to Zimbabwe by the Bretton Woods
institutions (such as the International Monetary Fund (IMF) and the World
Bank), and they contend that that barrier to funding is a primary cause of
Zimbabwe’s economic ills.

However, in doing so, they very conveniently, and with unmitigated gall,
disregard the fact that sanctions are wholly hypothetical, for in reality,
even if ZDERA did not exist, no funding could flow to Zimbabwe from those

Their constitutions preclude any advances to countries who are in default of
servicing their debts to those institutions, and Zimbabwe has gargantuan
arrears on loan repayments, its debt servicing default having been
continuous for more than a decade.

Therefore, whether or not the USA and other countries are bound to veto
international institutional loans to Zimbabwe, such loans would in any event
not have been forthcoming.  The fact is that by failing to service its debt
commitments, Zimbabwe has placed sanctions against itself.

The anti-sanctions campaigners further strive to substantiate their
deceptive contentions of the economic prejudices of the sanctions by
emphasising on the wideranging international ban on any funding for
commercial transactions with the Zimbabwean Government, its parastatals and
other economic entities, and those private sector enterprises in which 168
named individuals hold equity.

Admittedly, that sanction exists, but it is wholly notional, for even if the
sanction did not exist, none of that international community would
contemplate lendings to, and engaging in contractual arrangements with, a
government which, by its own admission, is “bankrupt”.

That is especially so in respect of an economy the size of that which
Zimbabwe had when the national debts amounts to US$6,9 billion.

What sane enterprise, other than one engaged exclusively in philanthropy,
would make loans or grant credit or otherwise transact with any that are
recurrently in default of honouring debt, and are flagrantly and blatantly
insolvent .

That is even more so when the enterprises seeking credit facilities and
loans are owned by a government which flagrantly expropriates legitimately
owned property of its citizens and residents without compensation and which
blatantly breaches the numerous Bilateral Investment Promotion and
Protection Agreements (BIPPAs) to which it is a signatory.

In a determined attempt to convince the grievously economic-ailing
population that all its ills are wholly in consequence of the diabolically
evil machinations of the western world, the politicians also repeatedly and
deceptively claim the sanctions to be illegal.

They found their argument on the fact that the sanctions were not agreed to
and imposed by the United Nations, whilst conveniently ignoring that any
country has the sovereign right to determine who  it will transact with, and
with whom it will not.

Each such country also has the right to determine how to exercise its votes
at meetings of international organisations of which it is a voting member.

The claims of illegality of the sanctions are therefore equally
misrepresentative, devoid of fact, and are further deception.

State-controlled media devoted its news bulletins endlessly and almost
exclusively to the campaign, citing the deceptive and false allegations of
the economy’s near-total collapse and the attendant misery of the masses,
unceasingly, as absolute fact.

There was total disregard for other world and national news.  At the same
time, enormous sums have been and continue to be expended by the campaign’s
promoters on endless and nauseous advertising to obtain the desired
signatures to the petition.

Also, the campaign promoters resorted to invasion of privacy by nationwide
transmission of SMS messages to virtually all mobile telephones on Net One.
(How did they receive unauthorised access to the millions of telephone

But the foremost deceipt is surely the real motivation for the campaign.
Its organisers must be fully aware that the campaign can only provoke
continuance of the sanctions.

That enables them to continue to castigate and abuse the international
community, and to contend intensifyingly that all Zimbabwe’s economic ills
are solely due to that community’s allegedly evil intents.

By so doing, they expect to continue diverting the population from
recognising the real causes of the myriad of economic ills, and thereby to
deflect any realisation that those ills are almost wholly a consequence of
gross misgovernance  and power abuse.

Concurrently, it has enabled them to disparage their political opponents for
their non-support of the specious campaign, and for allegedly motivating the
initiation and the continuance of the sanctions.

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Comment: Current indigenisation policy lacks sustainability

Friday, 11 March 2011 10:57

THE  hypocrisy surrounding the indigenisation issue and black empowerment is
now nauseating.  I am not saying that I am against indigenisation. On the
contrary I’m very much for the economy being in the hands of the majority.
It only makes sense and is the hallmark of real democracy.

But this can only be done if there are clear guidelines on what constitutes
indigenisation and black empowerment, where there’s a well thought out model
that is based on equitable distribution of the nation’s wealth.

The current model where a few greedy individuals embark on self
aggrandisement under the guise of indigenisation is not sustainable
.Actually it’s not even a model. We all know the names. It’s the same people
over and over again. They wanted farms, they got them and ran them down;
they want mines so that they could similarly run them down.

Now, they want to take over manufacturing companies and banks. In fact this
horde has ingeniously appropriated the word indigenisation to refer
exclusively to themselves.

No sir, we have seen it all. We need indigenous people from a wider base who
will run our companies and banks, not run them down; we need managing
directors, not damaging directors.  We want indigenisation that comes from
the bottom up, where companies are grown by their founder entrepreneurs, and
not where political appointees and cronies are parachuted into firms.

Our parastatals are a case in point. How many of them have ever succeeded?
They have been the biggest drain on our fiscus as they have continuously
needed to be bailed out.

That’s the result we’ll get if we pursue this method.  But if we’re to be
successful we need a blueprint on indigenisation based on a solid,
sustainable model. Legislation alone is not enough; it will be part of the
model.  In developing the model it’s essential to understand that
indigenisation does not equate to expropriation. It seems the current
thinking is that in order to indigenise the economy, we must of necessity
expropriate from the non- indigenous. Or to put it another way, that in
order to empower blacks we have to disempower non-blacks. Such thinking is
convoluted and has been the bedrock of our economic woes to date.

Is our economic base so small that unless we grab from the non- indigenous
we can’t have anything?  Current estimates of our GDP range anywhere between
US$5 billion and US$8billion. Yet many of the chief executive officers at a
recent roundtable were agreed we could be a US$100 billion dollar economy by
2030. So clearly, the Zimbabwean cake can be made bigger for all to have
fairly big slices. What needs to be done is simply to create the enabling
environment where the majority of the population will be able to

It’s not difficult. Zimbabweans are very enterprising people; all they need
is the support from the top. It’s not as if this hasn’t been done before. If
we take the financial sector for instance, indigenisation was achieved
without taking over  existing banks.

The enabling environment for blacks to enter into the financial services
created by, among other means, lowering the thresholds on minimum capital
adequacy and, voila! we had so many indigenous banks literally mushrooming.
In fact, with the exception of a few that had problems, most of these banks
went on to become very successful and grabbed a substantial portion of the
market share. This was because many brought with them innovative products
and in many instances literally outshone the established banks in terms of
the quality of service.

That CBZ has emerged from the brink of collapse as the former BCCZ to become
today the bank with the largest depositor base, overtaking the Standard
Chartered and Barclays banks of this world, speaks volumes of the
possibilities created merely through the creation of an enabling
environment. NMB and Trust banks brought up service that could only be
described in superlatives.

Therefore the magic wand for successful indigenisation lies in government’s
hands, which is in the black people’s hands. They are the ones with
political power and influence on the direction of business.  It’s a well
known fact that government is the largest purchaser of goods and services in
any country.

So as in South Africa, legislate that at least a certain proportion of
government contracts must go to the indigenous population or that preference
will be given to established companies that partner with the indigenous

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Editor'sMemo: A country reeling under siege

Friday, 11 March 2011 10:56

AFTER temporarily departing from his totalitarian script following the
formation of the inclusive government in 2009 in the aftermath of a disputed
presidential election, President Robert Mugabe is firmly back on his brutal
track: that of systematic political repression and a sweeping crackdown on

In the process, Zimbabwe is yet again a country under siege. Oppression and
brutality are back in currency. The rule of law is being brazenly violated
and impunity has returned. Violence against the civilian population has
resumed. While politicians bicker on who is responsible the victims continue
to suffer.

Ministers, MPs, civil society leaders, ordinary people and real and imagined
enemies of the state, Zanu PF and Mugabe are being selectively arrested

Journalists, lawyers, political activists, trade unionists, and human rights
defenders now have their rights to freedom of expression, association and
peaceful assembly curtailed.

Government’s reaction to criticism is to discredit and attack the messenger,
including through Orwellian propaganda, intimidation and arbitrary arrests.
The risk of enforced disappearances and sometimes killings is growing. So is
the threat of renewed intimidation of judges and magistrates who always work
under political pressure.

Suppression of human rights defenders and perceived political opponents of
Zanu PF is resurfacing in a big way. MDC-T MP Douglas Mwonzora and 23
villagers are still languishing in Mutare remand prison after being arrested
on allegations of violence. Zanu PF officials and their supporters are not
being arrested despite being the main perpetrators of violence.

Recently former MDC MP Munyaradzi Gwisai and 45 others were arrested and
charged with treason for allegedly plotting Egyptian-style riots.

NCA leader Lovemore Madhuku has been summoned to court in connection with
2006 events for allegedly violating the Public Order and Security Act. There
are many other examples.

The Attorney General’s office continues to invoke Section 121 of the
Criminal Procedures and Evidence Act to prolong the detention of human
rights defenders and political activists who would normally have been
granted bail. Section 121 allows a further seven days in detention to allow
the state to lodge an appeal with a higher court.

As people’s lives continue to be torn apart by repression, violence, power
struggles and political stalemates, Zimbabwe now risks sliding back to the
dark era before 2009. Dark coulds of political uncertainty are gathering.

Prime minister Morgan Tsvangirai yesterday threatened to pull out of
government after the arrest of Energy minister Elton Mangoma and
nullification of the  election of MDC-T speaker Lovemore Moyo, among other

The prospect of a meltdown is becoming even more ominous given events in the
Middle East. Clearly Zanu PF’s section of government is afraid of the
contagion of events we have been seeing in Tunisia, Egypt, Bahrain, Jordan,
Algeria, Yemen and Libya. That’s why it has taken advantage of its control
of the security apparatus to launch pre-emptive strikes against discontented

Mugabe fears Egyptian-style riots, hence panicky repression.

This explains why the army was out in the streets last week, rolling tanks
and brandishing artillery.

Government’s fear of its own people is behind the latest repression.

No meaningful measures have been taken to bring to justice perpetrators of
serious human rights violations during the state-sponsored violence and
torture of Mugabe’s political opponents in the run-up to the presidential
election run-off in June 2008 apart from a few isolated prosecutions.

The Organ on National Healing created to facilitate rehabilitation of
victims of violence and ensure reconciliation has been ineffective.

Companies are now being targeted afresh, but this time round with calculated
venom under the guise of indigensiation and the anti-sanctions campaign.
Only yesterday Unki was targeted by Zanu PF anarchists. The country is under
siege again.

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Comment: Mugabe must uphold national interest first

Friday, 11 March 2011 10:49

FORMER Zanu PF secretary general and political maverick Edgar Tekere once
said, when referring to President Mugabe, that he was badly advised. He was

There is an old African saying that states that a king is only as good as
his courtiers. Applied to modern states, a president is only as good as his
advisors. Whoever advised the 87-year old Mugabe not to attend the Euromoney
Conference that he had been billed to attend is neither good for the ageing
president nor the country.

Although the state president was invited in time, his spokesman claimed
Mugabe, who has been advocating for seizure of foreign owned companies, had
not been given enough time to prepare for the investors meeting.

Instead, Mugabe ironically chose to attend a Zanu PF politburo meeting a few
metres away from the conference venue and devoted several hours to partisan
business at the expense of national interests.
Had he been looking at the interest of all Zimbabweans this would have been
the perfect chance to dispel market fears that he wants to seize foreign
owned companies, assure the investment community that Zimbabwe was ready to
respect property rights and generally calm unnerved investors.

Even Confederation of Zimbabwe Industries boss Joseph Kanyekanye, who last
week sided with Mugabe on sanctions, this week condemned the veteran leader’s
threats saying the plans would do more harm than good to a country already
facing limited foreign direct investment.

Although Prime Minister Morgan Tsvangirai could have done some damage
control with his conciliatory and assuring statements, government,
particularly the principals to the GPA, have to be seen presenting a united
front and singing from the same policy hymn book.

This would largely help in sending consistent messages to the market. For
instance, last week Mugabe ordered Empowerment minister Saviour Kasukuwere
to takeover specific foreign-owned companies.  And this week, Tsvangirai
told delegates to the Euromoney Conference that Zimbabwe would not
expropriate or nationalise foreign-owned businesses in the country. While
that could have calmed the market to an extent, the damage had already been
done. Mugabe should realise that foreign direct investment is limited,
fickle and has many options.

This takeover mantra must stop before more harm is done, period. Even after
Tsvangirai’s assurances, a lot more needs to be done to ensure that the
principals — Mugabe, Tsvangirai and Mutambara — have their eyes on the same

The whole indigenisation plan is now mired in uncertainty owing to the
conflicting statements. It is of paramount importance to deal with these
policy inconsistencies before Zimbabwe slides back into an economic crisis
as witnessed during the land reform era.

While Mugabe is known to play to the gallery too often, others such as
Kanyekanye and Zimbabwe Mining Development Corporation chairman Goodwills
Masimirembwa should know better.

The two should measure their words and not create a side show at such
important gatherings.

Masimirembwa took a cheap shot at Britain’s ambassador to Zimbabwe, Mark
Canning, reminding him that the Union Jack was lowered in 1980. But he met
his match.

Replied Canning: “I find it deeply depressing that you (Masimirembwa and
Kanyekanye) should take the presence in Harare of many, many eminent foreign
businessmen to feed them your self-serving political nonsense.”

Canning added that ZMDC was on the EU’s sanctions list because its
operations were “distinctly not transparent.”

Indigenisation as a policy should to all intents and purposes be encouraged.
Indigenisation can create employment and boost the economy but it must be
workable and sustainable. It must be a well-planned and carefully
implemented programme that will be based on willing buyer and seller and
fair valuations for equity. Otherwise, if badly executed it can further ruin
and finish off the economy.

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