THE parliamentary portfolio committee on Foreign Affairs,
Industry and International Trade investigating Ziscosteel affairs is
expected to summon top government officials implicated in the scandal
rocking the company.
Chairman of the portfolio committee Enock Porusingazi said
yesterday his team might "invite" the officials named by the National
Economic Conduct Inspectorate (NECI) report, which details looting of public
funds at Zisco by individuals and companies, to "clarify" issues surrounding
the government-owned steel-making firm.
"As a committee we are interested in the new developments on the
Zisco affair and we might invite all those who have been mentioned with
regard to the matter to clarify certain issues for us," Porusingazi said.
"We need to follow these latest developments on the issue so
that we get to the bottom of the matter. We have to make a comprehensive
report to parliament and for us to do that there is need for the committee
to do a thorough job to ascertain the truth about the Zisco situation."
Vice-President Joice Mujuru, widely-tipped to succeed President
Robert Mugabe, has been named in the NECI report. It also names
co-Vice-President Joseph Msika and several ministers including Samuel
Mumbengegwi, Olivia Muchena, Sithembiso Nyoni, Stan Mudenge, and Patrick
Chinamasa, former Zanu PF MP Tirivanhu Mudariki and the late ruling party MP
Gibson Munyoro as some of the people who could have benefited from Zisco.
Muchena has disputed the NECI report, while her colleagues have been mum on
Former Zisco MD Dr Gabriel Masanga, the marketing executive
Rodwell Makuni and a host of other senior managers been mentioned as the
main culprits in the affair.
NECI says Zisco finances were raided through questionable
contracts and a string of payments covering controversial purchases,
services, airfares, hotel bookings, directors' fees, management expenses and
Porusingazi said his committee would approach the Zisco saga
with an "open mind" and give everyone the opportunity to explain themselves
in a free and fair manner. He also said the committee needed to go "wider
and deeper" into the Zisco scandal.
"We are not saying what has appeared in the media constitutes
the whole truth, but we want to find out what has been going on at Zisco and
make recommendations to parliament. Whatever our findings will be, we will
put them in a report which will not be panel-beaten. We have a duty to
inform parliament, which represents the interests of the people, on what has
been happening at Zisco that is a government company."
Government has of late been trying to suppress the NECI report
to hide its sensitive disclosures. Ministers have been making statements and
then later backtracking on them over the issue.
Industry and International Trade minister Obert Mpofu is now
facing impeachment charges by parliament for perjury after he allegedly lied
to Porusingazi's committee under oath.
Mpofu initially told the committee senior officials, including
"colleagues of mine in parliament" had looted Zisco but later backtracked,
claiming that "I'm not aware of any particular minister or senior person or
MP or anybody" involved in Zisco.
Anti-Corruption minister Paul Mangwana initially said those
implicated in Zisco would be prosecuted.
"Very soon we will take action and police will make arrests of
those who were involved in corruption at Ziscosteel irrespective of their
political or social status," Mangwana said. "It doesn't matter if they are
ministers or MPs. As long as they were involved they will be arrested. If we
find that a crime was committed by whoever we will call in the police and
provide evidence for prosecution."
However, Mangwana later changed his tune, saying he could not
talk about the NECI report because it was a state security document.
He then changed again saying some of his colleagues were under
investigation. "I cannot say the names (of the culprits), but yes, I can
only inform you a number of esteemed colleagues are under investigation," he
State Security minister Didymus Mutasa said the NECI report was
non-existent and challenged Mpofu to name those involved if he knew them.
Msika, named in the NECI report, said there was no looting at Zisco.
No proper official government comment has been made on the
issue, except remarks by an anonymous columnist believed to be Mugabe's
spokesman George Charamba in the government-run Herald which claimed no
politicians were implicated in the Zisco scandal.
PRESIDENT Robert Mugabe this week intensified mortgaging
Zimbabwe's mineral resources in a bid to secure fuel from Iran, raising
fears about the security of the country's mineral wealth used as guarantees
in opaque deals.
Mugabe's desperate hunt for fuel in Iran using minerals as
collateral came amid recent reports that China and Russia had also got
mineral rights in exchange for financial, trade and investment deals which
have remained shrouded in secrecy.
China and Russia have so far failed to give Zimbabwe any
significant lines of credit because the country's credit rating has plunged
due to the current crisis. Zimbabwe has been grappling with a fuel crisis
over the past seven years.
According to the Iranian news agency, Far, Energy and Power
Development minister Mike Nyambuya discussed a fuel deal with Iranian Oil
minister Kazem Vaziri Hamaneh who agreed to meet the country's needs.
"During the meeting, the Iranian side made a number of proposals
to meet Zimbabwe's needs in fuel and oil products, which were welcomed by
the Zimbabwean minister," Far said.
"The two sides also agreed to assign a group of Iranian experts
to help to renovate Zimbabwe's oil refineries. Further in the meeting,
Hamaneh said that once Zimbabwe's oil refineries are reconstructed, Iran
would start crude supplies to Zimbabwe in order to meet that country's fuel
It is understood Harare promised Iran an array of minerals to
settle its debt as it continues to mortgage natural resources to foot its
import bill. Reserve Bank governor Gideon Gono has said Zimbabwe will
leverage its minerals to secure imports like fuel that government is now
failing to pay for due to foreign currency shortages. Nickel from Bindura
was recently used as surety in a US$50 million fuel supply deal with French
banking giant BNP Paribas.
Mugabe has in the past mortgaged Zimbabwean resources to Libya
after clinching a fuel deal with Libya's Muammar Gaddafi. But the US$360
million deal later collapsed due to Zimbabwe's failure to pay.
Gaddafi seems to have dumped Mugabe after he started moves to
end years of international isolation.
Zimbabwe has been searching for reliable fuel supplies in vain
from Kuwait, Angola, Sudan, Nigeria, Venezuela, and Iran. The countries that
have sustained Zimbabwe although they are not oil producers have largely
been South Africa and
Mugabe met Iranian leader President Mahmoud Ahmadinejad on
Monday in Teheran where he attended the fifth joint economic commission
meeting for the two nations aimed at strengthening industrial cooperation.
Mugabe was accompanied by Nyambuya, Agriculture minister Joseph Made and
Foreign Affairs minister Simbarashe Mumbengegwi.
A Memorandum of Understanding was signed on Tuesday under which
various deals were agreed including cooperation in energy and agriculture.
Iran has also pledged to build a 1 600MW power station on the
Zambezi, while Zimbabwe is set to buy tractors and other agricultural
equipment from Iran in the coming two months.
AGRICULTURE permanent secretary Simon Pazvakavambwa faces the
chop over the fertiliser saga which has sparked clashes between government
officials and the Reserve Bank.
High-level sources said President Robert Mugabe had already
approved the dismissal of Pazvakavambwa who was initially due to have been
fired last week but could not because Public Service Commission chair
Mariyawanda Nzuwah was not at work.
Nzuwah and Secretary to the Cabinet Misheck Sibanda were said to
have been informed of the decision to relieve Pazvakavambwa of his duties.
Sources said Pazvakavambwa was supposed to have received his
letter of dismissal on Tuesday after another failure to give him the letter
on Monday. Mugabe was said to have authorised the dismissal before he left
for Iran this week.
Pazvakavambwa is likely to be replaced by Arex director Shadreck
However, Pazvakavambwa said he was not aware of moves to fire
him over the fertiliser saga which led to serious clashes between him and
ministers on the one hand and Reserve Bank governor Gideon Gono on the other
during a National Economic Recovery Council (Nerc) meeting last week.
Pazvakavambwa, who was arrested last year for allegedly stealing
equipment at a farm, was said to have uttered harsh words against Gono at
last week's meeting during a heated debate over the fertiliser issue which
involves South African company Intshona Agricultural Products. Reserve Bank
officials said the fertiliser deal was regular but media reports insisted
there were problems related to quality.
Contacted for comment yesterday, Pazvakavambwa said he was not
aware of steps being taken to fire him.
"I have not been served with any letter. There is nothing like
that. I am still at my work and if there is a dismissal or suspension
letter, then I haven't seen it," he said.
Sources said his dismissal was endorsed after the Nerc meeting
in which Gono clashed with several ministers, including Economic Development
minister Rugare Gumbo, Deputy Finance minister David Chapfika and Industry
and International Trade permanent secretary Christian Katsande, who accused
him of not consulting on issues. Vice-President Joice Mujuru chaired the
meeting in which Gono was attacked. He later stormed out of the meeting,
according to reports.
Pazvakavambwa is being accused of trying to distance himself
from the importation of inferior fertiliser from South Africa when he toured
and tested samples of the product at the Intshona workshop in South Africa.
He was also accused of failing to issue import permits on time.
This comes as Pazvakavambwa, Agriculture minister Joseph Made
and Gono are next week expected to appear before the Parliamentary Portfolio
Committee on Agriculture to answer questions on how inferior fertiliser was
imported from South Africa.
DANIEL Shumba's luxury car has been seized and is being
auctioned after his United People's Party (UPP) failed to pay for the
equipment it hired for its official launch in June.
The move comes amid revelations this week that the party, formed
earlier this year, is in serious financial problems and facing collapse.
Rooney's Hire Services, which hires out equipment for functions,
has since attached one of Shumba's cars through the Deputy Sheriff. The
vehicle is now being auctioned by Ruby Auctions to recover UPP's debt which
sources say runs into millions of dollars.
Shumba formed UPP after being expelled from Zanu PF for
participating in the Tsholotsho meeting which claimed the scalps of five
other provincial chairmen.
The party has failed to pay for the chairs, tents and public
address system it hired from Rooney's for its official launch five months
The car that Rooney's has impounded is a Mercedes-Benz C280 that
belongs to Shumba. The vehicle whose registration number is 714-141P will be
auctioned on December 2. It is a 1995 model with a mileage of 195 000
Although the quantum of the debt could not be ascertained, an
official at Ruby Auctions said they were hoping to sell the car for "around
An official at Rooney's confirmed the case and sale of the
vehicle but refused to comment further because the directors of the company
were in Zambia. Shumba could not be reached for comment as all his known
mobile numbers were said to be out of use.
News of the crisis in the UPP comes hard on the heels of
information that his other company, TeleAccess Zimbabwe, is also in
financial trouble following the cancellation of its licence earlier this
Sources said Shumba had since lost most of his workers at
TeleAcess and was battling to pay those remaining. TeleAccess' offices at
the 11th and 12th floor of the Kopje Plaza have been closed. The company's
registered telephone numbers are also not working.
MORE than 30 farmers under the A2 scheme were last week charged
under the Public Order and Security Act (Posa) by Mashonaland West police
after they staged a demonstration against Zanu PF central committee member
The 31 farmers accused Muduuri of engineering their eviction
from Impalasvale on allegations that they were underutilising the land.
The group of farmers, who were detained for two days at
Battlefields police station for contravening a section of Posa by not
seeking police clearance before the demonstration, will be notified of a
date to appear in court by way of summons.
Mashonaland West governor Nelson Samkange last week told the
Zimbabwe Independent that a recommendation had been sent to the National
Security, Lands, Land Reform and Resettlement ministry through him that some
of the farmers be removed from the property on allegations of underutilising
land and vandalising irrigation equipment.
Samkange said the farmers had blocked the road leading to
But in interviews this week the farmers who spoke on condition
of anonymity for fear of victimisation denied the charges.
They said the reason for the impending eviction was to
facilitate the expansion of Muduuri's portion of the farm, which forms part
"We saw a communication at the DA's office in which the DA was
saying there was no land for 15 of us who were to be removed to pave way for
Muduuri," one of the farmers said.
"The central committee member is behind the plot to evict us,
not these false allegations about not utilising the land."
Another farmer said the governor had been misled on developments
at the farm, as he had not visited the area to see for himself.
On Wednesday Muduuri said it was not true that he was to blame
for the farmers' woes, saying he could also end up being affected in the
event that government decided that some people should lose their land.
"The replanning is not done by me. Government does it," Muduuri
"As to why they demonstrated against me, I do not know. I
suspect they were relying on lies someone told them," he said.
If the Lands ministry adopts a recommendation that the farmers'
properties be taken, they would become illegal occupiers of the land,
something that was outlawed by the signing into law of the Gazetted Land
(Consequential Provisions) Bill by President Mugabe two weeks ago.
The latest legislation repeals the Rural Land Occupiers
(Protection from Eviction) Act (No 13 of 2001) whose provisions the gazetted
Act says have "become redundant because they do not apply to state land".
ONE of the country's leading manufacturers of detergents and
foodstuffs, Olivine Industries, has ceased the production of cooking oil
after the US government ordered them not to buy raw materials from 'stolen'
farms, businessdigest established this week.
The processor of agro-products is a subsidiary of US food giant
Heinz Group whose operations are monitored under the Zimbabwe Democracy and
Economic Recovery Act passed in 2001. The Act discourages US firms or their
subsidiaries from doing business with Zimbabwe until democracy is restored.
According to information gathered, the firm can no longer source
raw materials such as soyabeans and cotton seed, the main ingredients in the
manufacturing of cooking oil.
Section 4 of the Act directs the Secretary of the Treasury "to
instruct US executive directors to multilateral development banks and
international financial institutions to propose review of, the cancellation
or reduction of indebtedness owed by, or the extension of loans, credit, or
guarantees to, the Government of Zimbabwe (until) the President's
certification to the appropriate congressional committees that: (1) the rule
of law has been restored in Zimbabwe; (2) certain election or pre-election
conditions have been met; (3) the Government of Zimbabwe has demonstrated a
commitment to an equitable, legal, and transparent land reform programme
that is consistent with agreements reached at the International Donors'
Conference on Land Reform and Resettlement in Zimbabwe held in Harare,
Zimbabwe, in September 1998".
Under the Act Olivine, which is an American company, cannot buy
raw materials from resettled farmers.
Companies and farms which have been doing business with Olivine
were also warned against doing business with the American company.
Sources said government had since October 2001 been trying to
localise Olivine and some of its subsidiaries but the American company was
The localisation involved employees and other local investors
taking up a significant stake in the company.
Olivine chief executive Ian McKenzie referred all questions to
the company's commercial director, Phenias Chingono, who said he was not at
liberty to discuss the issue yesterday.
Owing to the unavailability of raw materials, Olivine stopped
manufacturing cooking oil two months ago as it faces critical shortage of
soyabean and cottonseed, important components in the production of cooking
The development has seen the commodity disappearing from shop
FRESH details of corruption at Zimpapers surfaced this week with
more officials submitting allegations of graft to the police.
Documents to hand show that the police investigating the matter
have been provided with a December 2005 internal audit exposing gross
corruption, abuse of systems and serious security laxity at the Zimbabwe
Stock Exchange-listed firm.
Before the audit, the Zimpapers vehicle purchase system allowed
the chief executive and the financial director to be the only people to
decide on what to purchase, opening the system to abuse.
Zimpapers officials have since written to acting Information
minister Paul Mangwana exposing corrupt practices and the victimisation of
those employees perceived to have brought the matter to light.
The audit compiled by group internal audit manager Andrew
Chinyama says the laxity of systems at the group's workshop operations,
procurement procedures, inventory management and resource utilisation had
resulted in the company incurring losses that could have been avoided.
"The existing vehicle purchase system in place is negatively
skewed against the group to the extent that the organisation was not getting
its full value for money from its purchases," the audit says.
"Of note were two Mazda MPV vehicles which were purchased on
September 30, 2005. Whilst audit fully appreciated the aesthetic value
possessed by these cars, there were practically no spare parts for the
vehicles in Zimbabwe and the garage had been trying to purchase shock
absorbers for one of the vehicles for over four weeks without success."
The audit said the purchasing procedure was structured in such a
way that the technocrats in motor mechanics were only consulted on the
serviceability of a vehicle and to recommend the purchase.
"Once the vehicle had been purchased there was no mechanism to
allow the technocrats to verify whether the delivered vehicle had all the
accessories intact," the audit says.
"The branch had already fallen prey to unscrupulous car dealers
who were tampering with vehicles' accessories. Of note was a Mazda 323
Familia, which was allocated to the Herald brand manager.
"The vehicle was one of three cars purchased from Zieper
Investments with car radios such as Sony, Kenwood or Pioneer. But when
delivered, it was discovered that one of the radios had been replaced by an
unknown and broken down radio and the branch had to incur an additional $5
175 000 (old value) to fit a new radio."
The corruption investigations were prompted by a letter from the
Attorney-General's office to Assistant Police Commissioner Nyathi at Harare
Central instructing him to institute an investigation into allegations of
corruption at Zimpapers.
The AG's office was responding to complaints from senior
Zimpapers officials who claimed the company was being invoiced money for new
vehicles when it was receiving second-hand cars.
The AG's office also ordered the police to investigate the
reinstatement of Adolf Majome - Zimpapers' financial director - who was
previously arrested on allegations of corruption but the company later
withdrew the charges.
"If it is correct that Mr Majome was reinstated as the chairman
of the purchase committee, after his arrest on allegations of corruption
arising from his functions in the same post, then this raises eyebrows and
is a cause for concern. There is reasonable basis to warrant an
investigation," the letter said.
CONTROVESY at Chigwell Estate took on a new dimension a
fortnight ago with deputy Information minister Bright Matonga being accused
of trying to sell scrap metal belonging to the former owner of the farm, Tom
Speaking to the Zimbabwe Independent last week, Beattie alleged
Matonga, who was allocated part of the farm, had loaded a 30-tonne-truck of
scrap metal from the farm on October 21.
"We alerted the police about our scrap metal that was being
loaded onto a Marongwe Transport ERF truck," Beattie said.
"Police intercepted and impounded the truck, keeping it at
Chegutu police station from October 21 to October 27. The truck was later
taken back to Chigwell Estate to off-load the scrap metal."
Beattie said police arrested five of Matonga's workers and
Misheck Nyamkonda who had bought the scrap metal from the deputy minister.
A docket was opened under CR number 174/10/06.
"The buyer told the police that he had done an electronic
transfer of $900 000 into Matonga's account on Friday 20th of October after
agreeing that he would collect the scrap metal the following day," Beattie
said. "We have since informed police deputy commissioner Godwin Matanga, and
questioned whether being allocated a plot meant taking away the scrap metal
on the farm."
Beattie said on realising that he had failed to illegally sell
the scrap metal, Matonga wrote to him demanding that he remove the scrap and
that if Beattie failed to comply he would do so himself.
"As you seem to have been offended by my clearing away the
rubbish scrap you left behind at your former farm, I would like to give you
the opportunity of seven days to come and remove the said rubbish," Matonga's
letter said. "Anything left lying around after this I will remove so as not
to hinder my development plans."
The letter was copied to one Ganyani, an Officer-In-Charge of
ZRP Chegutu, Governor for Mashonaland West Nelson Samkange, and Assistant
Commissioner Mahayo of Chinhoyi.
Contacted for comment, Ganyani referred all questions to the
provincial spokesman in Chinhoyi.
"Talk to Mashonaland West provincial spokesman, he has all the
details," Ganyani said. The spokesman could not be reached for comment as he
was said to be out of his office.
Matonga could neither confirm nor deny the development. Instead
he accused this reporter of pursuing a vendetta.
"Do you have a vendetta against me?" Matonga said "Why don't you
come to the farm and see what I am doing, then you can objectively write
Chigwell Estate has for some time been at the centre of
controversy with Matonga being accused of having harvested 140 hectares of
soyabeans and seed maize planted by Beattie. The proceeds were valued at $10
Beattie once wrote to Minister of Lands, Land Reform and
Resettlement Didymus Mutasa complaining about the situation at the farm as a
result of the "attitude of Matonga's employees".
"The situation at the estate is becoming progressively volatile.
All my staff have been threatened and forced to vacate their houses," wrote
Beattie in a letter that was also copied to a number of Zanu PF officials.
He also states in his letter that Matonga has taken over
irrigation pipes and declined to return them.
"I require these excess pipes for my winter wheat irrigation. I
am appealing to your office to help facilitate the return of these pipes,"
he said. - Staff Writer.
GOVERNMENT is forging ahead with the proposed spying legislation
after drafting a new version of the Interception of Communications Bill that
has failed to fully address the concerns of the Parliamentary Legal
Committee and stakeholders in the communications sector.
Government withdrew the initial Bill under pressure from the PLC
that is chaired by constitutional law expert and MDC MP Welshman Ncube and
protests by stakeholders in the communications industry at a Parliamentary
Portfolio committee on Transport and Communications hearing, amid promises
of a new version that would address their concerns.
The new consolidated version obtained by the Zimbabwe
Independent this week shows that changes made to the original text are minor
to the extent that, overall, the latest version retains its repressive
The new version still says: "An application for the lawful
interception of communications may be made by the following persons - the
Chief of Defence Intelligence or his or her nominee, the Director-General of
the President's department responsible for national security or his or her
nominee; the commissioner of the Zimbabwe Republic Police or his or her
nominee, the commissioner general of the Zimbabwe Revenue Authourity or his
or her nominee."
Communications minister, Chris Mushohwe and the Attorney-General
Sobusa Gula-Ndebele met the PLC last month resulting in the committee not
presenting an adverse report on the Bill in anticipation of an improved
In its draft report, the PLC said the old version's problematic
areas were: clauses 3(1) (b) (i); 4; 5; 6; 8 and clause 18.
In the consolidated text clauses 3(1) (b) (i); 4 and 5 have been
retained as they are despite the PLC draft adverse report having said: "It
is clear, Mr Speaker Sir, that the provisions of all these clauses
individually and collectively interfere with citizens' right of protection
from interference with their correspondence."
Whereas in the old Bill, aggrieved persons were required to
appeal first to the minister and then to the Administrative Court, in the
new version appeals are made straight to the Administrative Court that "may
confirm, vary or set aside the warrant, directive or order appealed
Although the previous version gives a list of people in Clause 5
who may apply for a warrant as well as nominees, the draft Bill said: "The
Bill does not provide for the criterion for selecting the nominee, it does
not limit the circumstances in which the minister may delegate this function
and does not provide a procedure for affecting the nomination." That
observation was not addressed.
Although on Clause 6 oral applications to the minister for the
issuance of warrants no longer apply, the new version has not addressed the
committee's concerns as it still says that the minister may issue warrants
"on reasonable grounds".
On that issue the PLC draft report had said: "In issuing this
warrant, the minister acts alone.The reasonable grounds need therefore exist
only in the mind of the minister. This is an incredibly subjective
criterion, which means, in effect, that the minister has unfettered
discretion in the matter."
The PLC draft report said there are no safeguards against the
minister abusing his power in issuing warrants. In the new version, the
government's solution was to come up with provisions for the review of the
minister's exercise of his powers to issue warrants by the Attorney-General.
After that review the Bill says "the Attorney-General may make
recommendations in writing to the Minister concerning the manner in which
the Minister shall exercise his or her powers in future".
In its draft report the PLC had said such controls "should
normally be assured by the judiciary, which offers the best guarantees of
independence, impartiality and proper procedure".
Apart from this, in its presentation to the Parliamentary
Portfolio committee on Transport and Communications the Zimbabwe Internet
Service Providers Association also proposed parliamentary review.
It also said in other countries with similar legislation
warrants are issued as a result of some judicial process.
Clause 8 still provides that evidence obtained by means of an
unlawful interception may be admissible in court if the court deems that
there are compelling reasons to allow its admission, although the PLC had
expressed reservations to it.
Although on clause 18 the Bill says: "Any person aggrieved by a
warrant, directive or order issued" may appeal to the Administrative Court,
that also falls below the committee's concerns. The committee had wondered
how the individuals would appeal against the issuance of the appeals when
they have not been told by the minister in the first place that the warrants
had been issued.
THE National Economic Conduct Inspectorate (NECI) has urged
police to charge former Zisco managing director Dr Gabriel Masanga and the
company's marketing executive Rodwell Makuni for corruption related to the
pillaging of the government-owned firm.
NECI said Masanga and Makuni should be held to account for
corruption at Zisco unearthed during its recent probe of graft at the
"Dr Masanga and Mr Makuni should be charged for corruption,"
NECI said. "It is indeed safe to conclude that Masanga and Makuni's
Siamese-like attachment to MISA (Macsteel International South Africa) smacks
of blatant corruption as manifested through the bargain price arrangements
for steel billets whereby the lowest of the international metal bulletin
prices is used as the contract price."
NECI said the agreement between Zisco and Macsteel was
prejudicial to the former, while it was beneficial to the latter. The
contract dealt with the provision of technical services by Macsteel to boost
Zisco's steel production capacity.
It was signed in violation of exchange control regulations and
without the company secretary, who gives legal opinion, being involved.
There was also tax evasion involved in the issue, NECI said.
Zisco paid Macsteel R915 408,49 in 2004, but later it was found
that Zisco's Botswana subsidiary Ramotswa also paid R1,6 million. The
payments were not properly explained, NECI noted.
Prior to the current pre-financing contract with Macsteel, Zisco
used to deal with UVISCO which later changed to Macsteel, owned 50% by
Mittal Steel South Africa, the continent's largest steel producer with a
steelmaking capacity in excess of seven million tonnes per annum and 50% by
the Eric Samson family.
NECI said it was clear Masanga and Makuni had vested interests
in the arrangement.
"Masanga and Makuni should be held accountable and charged by
the board for all losses incurred under the Macsteel pre-financing
arrangement," NECI says. "The pre-financing arrangement with Macsteel should
be reviewed with the view of terminating it provided Zisco gets alternative
NECI was damning on Makuni's dealings with Macsteel.
"Makuni's marriage with Macsteel smacks of gross infidelity to
norms and values of Zisco. Zisco billets are always received but in all the
instances the prospective buyers were informed that Macsteel is the official
agent on the international market," it said.
NECI said Astra Corporation of South Korea, for example, was not
given an audience even though it had expressed an interest in Zisco
products. Cosmofer AG/Fobsel was also snubbed when it proposed a financing
NECI also said there was a problem in the agreement between
Zisco and the Kwekwe-based Steelmakers. The contract gave Steelmakers the
right to buy "steel scrap" from Zisco.
However, there was controversy in how Zisco sold billets, blooms
and scrap metal to Steelmakers at below market prices when these could have
been sold for much more outside the country.
Zisco claimed the reasons it sold steel products to Steelmakers
at below market price included that there was "dumping" of steel products
into the country from South Africa and that Steelmakers was prepared to pay
But sources pointed out there were senior politicians who were
benefiting from the controversial Zisco-Steelmakers deal by buying steel
products cheaply from Zisco and reselling them at higher prices outside the
country. One politician well-known to have a vested interest in the deal is
a cabinet minister very influential in Kwekwe and in national politics.
"The value between the quoted price and the charged price was so
high that it could have grossly contributed to company losses," NECI said.
"Price lists should be approved according to company policy and procedure.
All the price lists should be subject to executive approval before
"The Zisco-Steelmakers relationship seems more parasitic than
symbiotic. Whenever the two enter into a marketing or sales agreement it
seems Steelmakers is always on the winning side. Hence the contract should
NECI also said Masanga should be held personally liable for the
contract he offered to Chartwell Capital Group of South Africa for it to
restructure Zisco's balance sheet and debt.
"Zisco paid Chartwell Capital Group R471 827,15 through
Ramotswa," NECI says. "Masanga brought in Chartwell without the involvement
of other executives. How he identified the company is not apparent."
The contract was later suspended midstream after payment.
There was also a problem, NECI said, in the agreement between
Zisco and the Reclamation Group Ltd for the supply of machinery. NECI said
Zisco bought substandard equipment from Reclamation on which a lot of money
was later spent on repairs.
"Truck number BFC648 was serviced to the tune of R1 718 736,67
whilst machine number BCF1029 was attended to the value of R653 085,20,"
NECI said "The point being made here is that the equipment was not a wise
purchase as they had gone through a lot of repairs, hence the resultant
Zisco's technical staff was excluded from the buying of machines
and equipment by Masanga and Makuni.
"Masanga and Makuni should be held accountable for the
purchasing of this substandard equipment and subsequent financial losses
incurred by Zisco. The losses incurred by Zisco should be recovered from the
two because they flouted company procedures," NECI said.
"The contract between Reclam and Zisco should be reviewed as
Zisco can be perpetually married to Reclam for a period of five years with a
possibility of renewal to 10 years. Makuni must be charged for willfully
engaging Zisco in a prejudicial agreement with Lenkas (a division of
Zisco had an agreement to sell Lenkas 10 000 tonnes of steel
scrap consisting of 7 000 tonnes of processed and 3 000 tonnes of
There were also questions around the Zisco contract with Indian
firms Bharat Roll Industries/Gayson & Co to sell scrap melting rolls to it.
The deal was botched and NECI said Makuni failed to provide details on how
Bharat Roll "came to be aware of the 'neglected' rolls at Zisco".
In the end, NECI said, Zisco suffered huge financial losses
through shady deals and payments that constituted corruption.
THE High Court has reserved judgement in a case in which the
Zimbabwe Congress of Trade Unions (ZCTU) is challenging government's
decision to bar Zwelinzima Vavi, the Cosatu secretary-general, from entering
Defence lawyer Aleck Muchadehama argued that Vavi's deportation
in May this year was unprocedural as no papers declaring him a prohibited
immigrant had ever been served.
"No such prohibition ever existed because he was not given any
notice of prohibition, he was not served with any papers and they did not
produce any proof of such service."
The outspoken Cosatu leader was deported on arrival at Harare
International Airport as he led a delegation that was due to meet the ZCTU
leadership to express solidarity.
Muchadehama added that when government initially barred the
Cosatu official from entering the country in 2004, Vavi was already in South
Africa and they did not accord him the chance to give his side of the story.
He says government's reasons are unclear.
"The minister refused to disclose reasons for his prohibition
and he actually issued a ministerial certificate to that effect."
Vavi has accused the Zimbabwean government of infringing workers'
rights and failing to abide by the rule of law. - SABC.
GOVERNMENT has extended Operation Maguta to sugarcane
plantations to revive collapsing sugar production in the eastern Lowveld.
Farmers from Chiredzi said Jano Labat had become the latest
victim to be forcibly evicted by the army.
"On November 20, the army with the assistance of the Chiredzi
police, forcibly evicted Labat, a French Mauritian cane farmer from his
homestead, even though he was protected by a Bilateral Investment Promotion
& Protection Agreement (Bippa)," one farmer from the area said.
Farmers said the army last month took over more than seven
sugarcane plots in the Mkwasine Estate and was currently harvesting and
transporting the cane on behalf of new farmers.
"The army is now in charge of the transportation of the cane to
the mills and is being paid for that," the farmer said. "Previously Mkwasine
Estate would transport the cane to the mills for the farmers and deduct
their expenses before paying the farmer the proceeds."
Labat's eviction leaves only about 18 white cane growers from
more than 50 farmers before 2000, and those remaining are only subsisting on
about 20 hectares each.
"The evictions have left the cane industry in turmoil due to the
low yields produced by the new growers who in fact did not put any capital
to purchase the farms. Several of these properties are now derelict and
produce no cane at all and employ only a few people," the farmer said.
In December last year government launched Operation Maguta
targeting to produce 2,3 million tonnes of maize, 90 000 tonnes of tobacco,
49 500 tonnes of maize seed, 210 000 tonnes of cotton, 750 000 tonnes of
horticultural crops, and 8 250 tonnes of tea.
Over the past six years the south-eastern Lowveld has been
rocked by invasions with land officers taking over five plots with a
ready-to-harvest sugarcane crop.
The farmers, most of them South African nationals, appealed to
the South African embassy to intervene, alleging that Chiredzi land officers
Mukonyora and Guruvheti and an A2 farmer Jambaya had a long history of
Farmers in the area said harassment of sugarcane growers had
been prevalent in Chiredzi, particularly towards the harvesting period, as
some unscrupulous elements want to benefit from a crop they did not grow.
ZIMBABWE'S Chamber of Mines has warned of a "dire situation" in
the gold mining sector, saying in a confidential letter to the Reserve Bank
of Zimbabwe (RBZ) that a raft of measures put in place last July had failed
to inject life into struggling mines because of non-payment of overdue
The industry's woes had been worsened by an unannounced 10%
deduction of the gold miners' delayed payments towards an Energy
The fund is meant to mobilise foreign currency for fuel and
electricity imports. Some mining operations are at the same time paying for
their electricity in foreign currency.
The Chamber of Mines, in a letter signed by chief executive
officer David Murangari dated November 15, said the RBZ subsidiary, Fidelity
Printers and Refineries (Fidelity), the sole buyer of gold in the country,
was failing to pay gold producers in time, creating severe cashflow problems
for the gold miners.
Gold producers had by November 14 outstanding payments due from
Fidelity amounting to US$9 million for the component of gold paid for in
foreign currency and $610 million for gold deliveries paid for in local
Some of the gold had been lodged with Fidelity as early as
September 7 but no payments had been made by the time the Chamber of Mines
wrote the letter to the RBZ governor Gideon Gono.
"The new payment scheme introduced in July where 50% (of which
25% is in Zimbabwe dollars and 75% in US dollars) of the value of gold
lodged with FPR (Fidelity) is being paid within four days and the balance to
be paid within 21 days has not worked from inception," the Chamber of Mines
wrote in the letter, a copy of which was seen by businessdigest.
The Chamber of Mines' letter followed several others written
individually by gold producers to Gono highlighting the problems besetting
the sector due to delayed payments from Fidelity.
Gono remained silent on the gold miners' pleas, prompting the
Chamber of Mines to write on behalf of the sector last week.
The Chamber of Mines said the delayed payments had caused
serious cash flow problems, something that could force "some mines to
temporarily shut down" unless prompt payments were made.
The Chamber of Mines said there had been serious disruptions to
operations since the RBZ introduced its new payment scheme in July.
The letter said foreign creditors had threatened to withhold
supplies while local suppliers were piling pressure on gold producers to pay
up before placing new orders.
The Chamber of Mines also sought to find out why Gono had
ignored the gold mining companies' pleas on the overdue accounts.
"A number of gold producers have written to the RBZ advising of
the difficulties being experienced in receiving payment as per the announced
policy. The silence that prevails in such difficult times does nothing to
build confidence in policy announcements and we strongly suggest that the
authorities provide the industry with some explanation of the challenges
being faced by the RBZ," the Chamber of Mines said.
"External suppliers mainly in South Africa are due to close for
the festive season. As a result any new orders for supplies will not be
entertained where payments for orders already delivered are still
outstanding. This will affect production seriously and could cause some
mines to temporarily shut down," the Chamber of Mines warned.
The letter was copied to Mines minister Amos Midzi, Finance
minister Herbert Murerwa, Economic Development minister Rugare Gumbo and
Chief Secretary to the President and Cabinet Misheck Sibanda.
The Chamber of Mines also argued that the static exchange rate,
which had remained fixed at US$1:$250 since July, was not keeping pace with
the rapid movement of costs.
THE Zimbabwe Stock Exchange (ZSE), rated the best performing
bourse on the continent by the African Stock Exchange Association (ASEA),
has failed to attract meaningful foreign participation due to a struggling
economy, businessdigest established this week.
ASEA said Zimbabwe's stock market offered investors the highest
returns in Africa in 2005 and most of 2006, despite a deep economic
The country's stock market had been one of the few investment
destinations where returns remained above the inflation rate of 1 070%, the
The Zimbabwe Stock Exchange rose 1 545% in 2005 and had shot up
by more than 2 000% by the first week of November this year.
However, businessdigest established this week that despite its
high performance, the local bourse was struggling to attract foreign
participation due to an economic crisis that has disrupted normal economic
activities in the country over the past six years, stunting industrial
productivity and hurting the performance of a number of listed firms.
Foreign participation on the ZSE is restricted to 10% but
figures obtained this week indicated that foreign participation on the stock
exchange accounted for a paltry 2,31% during the 10 months to October 31.
Last year, foreign participation accounted for 2,8% of
investments on the stock market.
Market watchers said a high tax regime and capital restrictions
had partnered to ward off foreign participation on the local stock market.
Investors on the ZSE are required to pay a 2% stamp duty, 15%
value added tax, 20% capital gains tax and 5% withholding tax.
Moreover, issues around repatriation of dividends and
investments had also triggered a flight from the local market by foreigners
unable to hive off their funds from the country due to foreign currency
Zimbabwe's economy has contracted by a cumulative 30% over the
last five years. The country has struggled to attract foreign direct
investment (FDI), said by economic analysts to be key to economic
Last year, FDI amounted to less than US$10 million. The country
had on average received FDI amounting to US$500 million annually before the
six-year economic crisis characterised by acute foreign currency, fuel and
THE Zimbabwe Tourism Authority (ZTA) has acknowledged that its
high-profile campaign marketing the country to China has failed, suggesting
the tourism marketing crusade had targeted only a small segment of the
potential Chinese market.
Chief executive Karikoga Kaseke said he had been "shocked" to
realise that key stakeholders in China had no idea about the tourist
attractions available in the country.
"I was shocked," Kaseke said in an interview soon after
returning from a tourism exhibition in the Chinese capital Beijing.
"Let's not fool ourselves, Zimbabwe is virtually unknown in
China. We have to do a lot of work," Kaseke said.
He suggested that the campaign targeting Chinese tourists had
failed primarily because of undercapitalisation and failure by the authority
to spread its campaign across all regions of the communist country.
The ZTA's campaigns had concentrated on the small Beijing market
and ignored other regions in the world's fastest-growing economy.
"The Chinese market has better knowledge of other African
countries than Zimbabwe. We are losing potential tourists because when
marketing, they (other countries) also include the Victoria Falls (as part
of their marketing packages)," Kaseke said.
"Zimbabwe must now start investing in destination awareness.
However, we have been researching (and) some of our researchers are in China
learning the characteristics of that market," said Kaseke.
Most buyers and travel agents in China were still not aware of
Zimbabwe's attractions despite popular official perception that the
marketing programmes launched to attract tourists from China had been
Kaseke, who was part of a delegation of tourism sector players
who last week attended the China International Travel Mart (CIT) in Beijing,
said there was scant knowledge of Zimbabwe's tourist attractions even among
Zimbabwe, isolated by the West for alleged human rights
violations, had adopted a "Look East" policy forcing the tourism sector to
diversify its marketing campaign and capture the Asian market following
travel warnings by major European and the American source markets against
visiting the country.
Zimbabwe had lost a significant share of its tourism market as a
result, and this has provided a major boost to neighbouring countries like
Zambia and South Africa who have seen growth in tourist traffic due to the
South Africa has included the Victoria Falls as part of its
tourism package, resulting in visitors to the world's seventh wonder coming
into the country for brief periods and spending less in the country as a
Zambia, which shares the Victoria Falls with Zimbabwe but
provides a less scenic view than that from the Zimbabwe side, has seen its
tourist numbers increase significantly over the last five years.
Traditional Western markets led by the United Kingdom have
slammed their doors on Zimbabwe since 2000 citing the high risks posed by
farm invaders and an unstable political terrain.
Government funded about 80% of Air Zimbabwe's first flights to
China introduced in 2004 as part of the campaign to woo tourists from the
China accorded Zimbabwe the Approved Destination Status (ADS) in
2003, giving its assent for Chinese nationals to visit Zimbabwe.
Kaseke said a lot still needed to be done to increase the
country's visibility among potential Chinese visitors.
He said they wanted the country to have at least 2 000 Chinese
tourists arrivals per week under a fresh campaign likely to be undertaken
following his visit to China.
Air Zimbabwe currently flies about 100 Chinese visitors into the
Zimbabwe suffered a 72% slide in Chinese tourist arrivals in
2005 from 26 000 in 2004 to 7 100 in 2005, but statistics for the first nine
months of 2006 have indicated a rebound.
The major barrier the Chinese tourists face in Zimbabwe and
other African countries has been the use of the English language by local
guides and the absence of Chinese cuisine in local hotels.
ZIMBABWE Stock Exchange (ZSE) chief executive officer Emmanuel
Munyukwi has called on the Reserve Bank of Zimbabwe (RBZ) governor Gideon
Gono to give up control of non-financial institutions, saying these should
be regulated and supervised by institutions other than the central bank.
Munyukwi told journalists at a recent workshop on financial
reporting that Gono should relinquish control of asset management companies,
the banned money transfer agencies, microfinance institutions, and others
and concentrate on supervising the banking sector.
He said under normal circumstances, non-banking financial
institutions should be regulated separately to ensure effective supervision.
"This is the only country in the world where the central bank
controls non-banking financial institutions," Munyukwi said.
"In Zimbabwe the central bank closes asset management companies.
In my opinion this is not correct," Munyukwi said.
Gono, whose central bank controls and supervises the financial
sector, has largely blamed financial institutions for spawning a financial
crisis that has disrupted the normal functioning of the country's economy
over the past three years.
A raft of measures put in place to restore normalcy in the
economy have resulted in the closure of at least 15 financial institutions
since 2004 and the banning of money transfer agencies and the transfer of
asset management supervision and money lending companies to the central
However, these measures have failed to restore confidence in the
economy and spark the turnaround Gono was tasked to spearhead when he was
appointed governor in December 2003.
THE National Oil Company of Zimbabwe (Noczim) has warned
petroleum companies that Mozambican authorities might soon impose road
levies on Zimbabwean fuel tankers passing through that country from Beira
due to the damage the vehicles were causing to roads.
The levy might result in petroleum product prices shooting up in
Zimbabwe as distributors pass on the costs to end users.
Most of the country's fuel imports come through Mozambique's
Beira corridor using the Feruka pipeline but small fuel distributors prefer
to transport their oil products by road because the Feruka pipeline is too
big and would trap small consignments.
Fuel industry experts last week said it costs US$0,06 a litre to
transport fuel by the pipeline from Beira to Msasa in Harare. However, the
haulage companies charged US$0,09 a litre over the same distance.
But despite lower costs incurred through the pipeline, 35% of
fuels are still being transported by haulage companies.
"There is already an outcry in Mozambique that Zimbabwean
vehicles are damaging their roads and very soon they might impose a levy in
foreign currency," said Noczim chief executive officer Zvinechimwe Churu
during a pre-budget seminar in Harare last week.
"Smaller players can group together into big consignments and
use the pipeline so that their stocks are not trapped in the pipeline," he
Churu said the haulage trucks were also damaging local roads.
Players in the industry said there were delays in accessing fuel brought
into the country through the Feruka pipeline. There have been suggestions
that government should build buffer stocks at Noczim's Msasa reservoirs so
that once companies brought their fuel through the pipeline, they could
immediately access it.
By Morgan Tsvangirai
ZIMBABWE approaches another farming season with uncertainty over
our food security needs.
The rains are already with us, but corruption and inept planning
shall see another failed season following a systematic destruction of the
agriculture sector that has led to a sustained economic meltdown.
Despite promises of a good rainy season, what we are witnessing
is a classic case of bungling: inadequate or fake seed, sub-standard
fertiliser, heavily subsidised fuel which is being diverted to the black
market and shoddy preparations for the industry's revival. A false start
always leads to another disaster.
The same lacklustre approach was evident last year and as a
result an estimated three million people are short of food today. A
disastrous beginning always ends in a national failure. Our wheat crop could
easily be reduced to waste due to shortages of working combine harvesters,
spares and proper planning.
Food shall remain scarce and prices beyond reach out of our
failure as a country to meet our traditional production targets. The sad
story rests on the chaotic land reform programme, which saw land use decline
by significant margins and output reduced by more than half of the previous
As long as Robert Mugabe and Zanu PF skirt around an obvious
political problem, our prospects for a meaningful turnaround remain poor.
The collapse of agriculture has affected all sectors of our economy leading
to losses of jobs, reduced export earnings, power and fuel rationing, weak
investor confidence, poor tax revenues and a sharp fall in social services.
Once a net exporter of food, our nation's plight has been
worsened by expensive food imports and serious shrinkages in the basket of
basic commodities. Every family is at risk because of seven years of
continuous disruptions in commercial agriculture and a determined onslaught
on property rights.
As inflation gallops to levels never seen in Africa before, even
in countries at war, attention seems to be directed at the symptoms of the
deeper political malaise resulting in serious economic distortions and a
sustained flight of local and international confidence.
Farming is a business and is better performed when land is seen
as an economic asset rather than a status symbol. The state lacks the
capacity to engage in productive commercial farming.
What happened to the huge estates run by the Agricultural and
Rural Development Authority in Middle Save, Muzarabani, Sanyati, Kondozi and
other productive areas shows that commercial farming is better left to
serious investors and farmers capable of making sense out of an economic
mixture of science, capital and expertise to produce food for the nation.
The meddling influence of the Mugabe regime in input procurement
and disbursement, farm management and crop and livestock production dynamics
is a perfect route towards a perennial state of food insecurity in Zimbabwe.
History is replete with examples of failed experiments with
agriculture when partisan interest groups, especially the military and a
political party militia, are pushed - out of political expediency -- into a
sector they know nothing about and are expected to produce food for the
nation. Their reluctance to stay on the ground and their lack of farming
expertise lead to corruption, crop failures and a drain on the little
currency available, through food imports.
The state can print as much money to dole out to these groups in
the form of support but that process will never deliver a basket of grain.
Many are already crying out for food hand-outs!
Our communal farmers, for many years a shining example of maize
producers, have been abandoned.
There seems to be an excessive political focus on the so-called
new farmer - a Zanu PF-created new community with no known interest or
knowledge of agriculture. This group perpetually looks to the state for
their loot, rewards and accolades, unlike the communal farmers whose track
record - even under arid conditions - is beyond debate.
Many of our rural areas are impassable due to poor roads; the
communal farmers lack essential support and inputs; the state of our
communal lands resemble a nation at war, their service centres are now empty
shells totally unable to support any meaningful economic activity in the
The former commercial farms are slowly being turned into zones
of inappropriate activities - the so-called new farmers resorting to
poaching, deforestation and gold panning in order to survive.
Given our experience during the last seven years, may I commend
the people for their resilience during the most trying times.
The humanitarian emergencies before the nation are daunting. We
must do everything in our power to save Zimbabwe. With the lowest life
expectancy rate in the world, the number of orphans in our homes is a major
source of worry.
Without access to food and drugs, the situation in most of our
homes - compounded by a devastating HIV and Aids pandemic - has reached
unacceptable and dangerous levels.
We owe it to our children to resolve the national crisis
speedily and to cast away our current pariah status in the eyes of the
international community. We need food, jobs, medical drugs and a good
education system for our children.
The people of Zimbabwe want to live well, with an affordable way
of life. We maintain our position that we can only reclaim our respect, at
home and abroad, if we deal with the nagging political questions and
disputes in our midst. We must move as one people towards a way out of the
political crisis in order to set a base for recovery, reconciliation and
We believe a new constitution and an environment that shape the
future and allow for free and fair elections shall provide the key to a
lasting resolution of the crisis and open doors to the creation of a
respectable and accountable government.
We remain convinced that we must organise ourselves and put
pressure on the regime to respect the power of the people. We have to fight
for our rights and improve our food sources and food security.
I look forward to working with all Zimbabweans to build a better
life for them and their families: to make Zimbabwe once again one of the
richest countries in Africa where every young person has a job, where every
child has plenty to eat, where every family can look to having their own
home, where every old person can have quality health care - working together
we can and will save Zimbabwe.
To those in Zanu PF and in the military who still believe in a
free and prosperous Zimbabwe, it is important to realise that political
insurance and progress depends on an environment that enjoys national
acceptance and national support.
We fought against colonialism to stop a few with privileges from
exploiting the national cake at the expense of the majority. The continued
segregation of the people through political patronage and a selective
allocation of scarce resources cannot be sustained.
The liberation struggle sought to bring about a new Zimbabwe.
That national project was anchored on a need for a foundation of equality -
in which our country provides shelter and care for all women, men and
children who live there, with equal access to justice, to public goods and
services, and to economic opportunity and resources, and where no unlawful
discrimination shall be accepted.
We believe in the unity of our people. We understand the folly
of separate development and are conscious of the consequences of inequality.
Given the current damage and its implications on family
relations, we believe it is important for our nation to heal its wounds and
re-build for the future, recognising that what binds us is far greater than
what divides us, celebrating our diversity and differences as individuals
and as communities, and with a common resolve to institute safeguards to
ensure that never again will our dignity be undermined by any one person or
May I re-state our desire for a Zimbabwe that cherishes good
governance, compassion, solidarity, peace, security and respect for women,
men and children. I wish to reaffirm our subscription to the principle of
sustainable development grounded in prosperity, quality of life and
community stability. As soon as we deal with our political problems, the
revival of sustainable agriculture must be the starting point in our efforts
to kick-start the economy.
* Morgan Tsvangirai is leader of one wing of the Movement for
THE National Economic Development Priority Programme (NEDPP),
touted by government as the panacea to the country's economic crisis,
expires next month with almost all of its major targets missed.
Launched in March with claims of strong private sector
participation, the programme was meant to reduce inflation, stabilise the
currency and generate foreign currency. It promised to increase
productivity, remove price distortions and reduce government expenditure.
NEDPP was supposed to turn around the economy within six to nine months or
at least steer it to a recovery path by year-end.
Perhaps its most ambitious target was to raise US$2,5 billion
through the disposal of state companies and attracting foreign direct
investments. The investments were to come from countries in Asia and the
Middle East whom government says are our new friends after the fallout with
the western world.
However, with a few weeks from the self-imposed December
deadline, the NEDPP has met the same fate as other programmes launched with
much fanfare but which dismally failed to revive the economy. Failures are
already apparent because the programme has changed nothing - the economy is
still well stuck in the mud with no prospect of recovering any time soon.
Inflation is still galloping ahead, food shortages are still
rampant and foreign currency remains scare. The dollar, even without the
three zeros, continues to lose value at an alarming rate. In the face of
such overwhelming evidence of failure, what remain are claims by government
officials about the success of the programme.
At times the claims come across as outright lies born out of
desperation to save political careers in a crumbling regime.
For instance, the programme said the bulk of the targeted US$2,5
billion would come from "strategic partnerships" between government and
foreign investors in specific parastatals.
No known deal has been clinched for strategic partnerships in
ailing state companies like Air Zimbabwe, Zesa, Tel*One and Net*One as the
programme proposes. If there were any such deals, they have remained just
that - deals signed but never implemented.
In the meantime Zesa still can't supply adequate power while
Net*One and Tel*One are technically insolvent.
The commercialisation of the Cold Storage Company, which
government said would be one of the major sources of revenue, has failed to
take off. Nothing has been heard about the planned investment deals for Air
Zimbabwe and the National Railways of Zimbabwe.
Analysts said NEDPP, like other programmes before it, was doomed
from the onset because government dodged key problems in the economy, opting
instead to compile a wish-list that was not supported by sustainable
CFX economist Blessing Sakupwanya said the NEDPP was a noble
initiative which was unfortunately thrust into an economy where fundamentals
"The fundamentals are just not right and the commitment is not
enough," Sakupwanya said. "The issue of interest rates, money supply and
investment policies are still outstanding."
Perhaps the major reason for its failure is that it was based on
the false premise that the economic crisis was caused by western sanctions.
It conveniently ignored government's destructive land reform policies that
have severely reduced production and created a huge bill for food imports.
Apart from its lack of substance, NEDPP comes across as a
half-baked programme cobbled together to give an impression that government
was doing something about the crisis. Apparently not many people in the
private sector have seen the NEDPP document.
As has become the norm, government wants to take the lead in
every revival programme but lacks the will and commitment for the policies
For instance, NEDPP talks about reducing inflation but
government keeps printing money to fund its political projects like the
senate whose additional burden on the fiscus comes in the form of salaries
and new vehicles. There is now talk of building a new parliament because the
old one has "become too small".
Government wants to reduce its bloated expenditure but still
manages to retain wasteful ministries like Chen Chimutengwende's Ministry of
Public and Interactive Affairs. For his part, President Mugabe has revived
his globetrotting habit using scarce foreign currency.
The country has a serious foreign currency crisis but government
finds it prudent to use the scarce resource to buy six fighter jets from
China when it is obvious that there is no security threat to Zimbabwe.
It promises to increase manufacturing productivity but has
failed to remove price controls on basics commodities like bread, mealie
meal, flour and sugar.
NEDPP wants to lure foreign investors but government has shown a
penchant for disregarding private property rights and rule of law. It wants
investors to commit their money to a country where laws are changed at every
sunrise and the judiciary is expected to be an extension of the government.
Government's investment laws are equally repelling to investors.
For example the fact that the state still insists on taking 51% in foreign
mines seems to have scuttled NEDPP's plans to increase foreign currency
inflows by reopening collapsed gold mines like Conemara, Ran, Golden Kopje
and Bell Riverlea.
It is the same reason why there have been no takers to reopen
other mines like River Ranch (diamond), Hartley Platinum and LSM (copper) as
the programme proposes.
Government's failure to resolve the outstanding cases under the
Bilateral Investment Protection and Promotion Agreements (Bippas) is an
indication that it is not serious about investment protection.
Although NEDPP acknowledges agriculture as the backbone of the
economy it fails to come up with strategies to increase productivity.
The programme had also sought, without success though, to revive
agriculture this year through winter wheat cropping targeting 110 000
hectares as well as supplying adequate agricultural input for the summer
crop. The winter wheat programme missed its target by 47%, translating into
about 57 800h. The agricultural season is under threat with revelations that
some of the fertiliser imported from South Africa was fake.
The NEDPP also sought to resuscitate two horticultural projects
through the revival of Kondozi estate and the activating of Prochain
Investment Flower Park project. It also makes projections that agriculture
will grow by 11,5% next year including a production of 2 millions tonnes of
However, these projections were made without addressing the
recurrent disturbances on the farms and perennial shortages of inputs.
Security of tenure issues have not been fully addressed despite the issuance
of 99-year leases. The farmers who got the leases a fortnight ago represent
less the 1% of the total arable land distributed during the chaotic land
Even then the leases cannot be used as collateral to access
loans from financial institutions. The uncertainty over property security
still exists because the government can withdraw the leases with the farmers
having very slim chances of seeking redress from the courts. But at least
the NEDPP document does have some lighter moments - it wanted to attract
back professionals who had left the country. The incentives for that project
have not yet been announced.
By Farai Makumbe
HAS the Central Statistics Office changed the way they measure
the rate of inflation as there appears to be a growing disconnect between
the cost of living and official statistics?
Personal incomes have stagnated and are failing to keep pace
with the rise in the cost of living while the media appears to be treating
price increases as non-events.
What is the impact of this?
Annual salary increment negotiations between employee committees
and management begin with Consumer Price Index (CPI) adjustments. How many
employees are falling further behind in their earnings because of an
How many landlords are cheated out of competitive rental income
by understated inflation rates?
Air Zimbabwe is making phenomenal losses due to the fact that
they are pricing their services below market costs.
This is a perfect example of why any business needs to price its
products/services after taking into account realistic economic data.
An understated CPI also overstates the gross domestic product of
the country by not removing the full inflationary impact of pricing from
nominal numbers. Any debate on inflation must begin with the truth.
By pointing to an understated CPI as proof that inflationary
forces are under control or stabilising is disingenuous at best and
fraudulent at its worst.
One of the main drivers of hyperinflation in Zimbabwe, I think,
is the extreme rapid growth in the supply of "paper" money through the
monetary and fiscal authorities regularly issuing large quantities to pay
for a large stream of government expenditures.
I mention both institutions here as there is currently a lack of
clarity of responsibility in the aftermath of the central bank governor's
admission to engaging in quasi-fiscal/monetary policies. In effect,
inflation has become a form of taxation where the government is gaining at
the expense of those who hold money whose value is declining.
Hyperinflation being experienced here is therefore a very large
taxation scheme in another form.
Zimbabwe's hyperinflation, like all hyperinflation situations,
The government is realising that it can no longer buy as much
with the money it is issuing and is responding by raising money growth even
further. The hyperinflation cycle begun this way, triggering a tug-of-war
between the public and government.
The public will naturally try to spend the money it receives
quickly in order to avoid the inflation tax while the government responds
with even higher rates of money issue. How will this hyperinflation end?
The standard answer is that the government will need to make a
credible commitment to halting the rapid growth in the supply of money.
* Farai Makumbe is a financial analyst based in Los Angeles,
THE Import Substitution and Value Addition Expo ended last week
in Harare with government and the central bank promising to support local
industry to produce goods that would see the country saving on foreign
currency. There was the usual pontification about the resilience of local
industry in the face of adversity.
The duplicity of government with regards to protecting local
industry from cheap imports should not go unchallenged. In fact, the biggest
threat to the policy of import substitution has been inconsistent government
policies regarding local industries. Reserve Bank governor Gideon Gono in
May last year tried to promote the concept through his "Buy Zimbabwe
Campaign" in which he said Zimbabwe missed opportunities for growth by
failing to expand industry and cut back on imports.
"An aggressive import substitution drive, spearheaded through
aggressive marketing and promotion of local brands with significant local
content in terms of manufacturing and packaging effort, would go a long way
in positively restructuring the economy's consumption patterns," Gono said
in a supplement to his monetary policy statement.
He added: "It cannot be over-emphasised that any policy that
encourages consumption of locally produced commodities will increase
industrial capacity utilisation significantly towards the targeted 100%
To date, we are yet to see any movement on that front. In fact,
Zimbabweans today are buying more foreign-manufactured products than they
were in 2005 as industry has continued to shrink. The average household in
Zimbabwe today is using imported cooking oil, soap, toothpaste, candles,
matches and other basket goods which Zimbabwe has traditionally
In most instances, even when the locally-made basket goods are
available, they are much more expensive than imported substitutes. Our
industry has lost all competitiveness and this is reflective of the
difficulties the country is experiencing in exporting local products.
The major reason for this anomaly is found in monetary policy
pronouncements that are out of sync with prudent economic thinking.
Zimbabwe's economy is agro-based hence no export substitution
can take place without optimum production on the farms. RBZ statistics to
hand show that in 2000 Zimbabwe spent US$61,7 million importing food and
that figure has been rising steadily over the years to US$334 million last
There has also been a marked rise in the national import bill
for chemicals largely because of maize imports. This can be attributed to
importation of fertiliser.
The two examples of food and chemicals point to our tragedy.
Zimbabwe has moved from a net exporter of food to a net
importer. The country has also become a net importer of fertiliser even
though it has world-class chemical companies.
This is the area where import substitution is required because
the country is haemorrhaging from food imports instead of earning foreign
currency from agro exports. There is also another worrying trend which has
seen the central bank becoming a major player on behalf of government in the
importation of plant and machinery at the expense of agro-dealers who are
franchise holders for reputable brands.
This participation in the importation of capital equipment has
seen state-owned transporter Zupco importing buses from China and Kenya when
local manufacturers could have produced better products at a cheaper price.
Local shoe and textiles industries have been hurting from the
loss of their market to cheap imports from China. Remember Cone Textiles?
While active industrial policy to promote import substitution should involve
state support to orchestrate production of strategic substitutes, protective
barriers and a monetary policy that spurs production and enhances export
competitiveness, the current initiatives have failed. Or perhaps government
does not after all care, especially when we consider deputy Industry
minister Phineas Chihota's statement at a pre-budget seminar in Bulawayo
We now know from him that: "Even if an individual or company
goes to China to purchase shoes which last for one day, we don't care
because that's not government's business." So the "Buy Zimbabwe Campaign"
was not government policy? Whatever the case, one thing is clear: they don't
give a damn!
By Joram Nyathi
"ZANU PF is in a corner and is desperately looking for a way
out," declared Pius Wakatama in the Standard this week. "Under the present
circumstances," he went on, "Zanu PF would not win a single seat in a free
and fair election."
Whenever I hear statements like this I feel there is virtue in
being naïve. My naivety makes me sceptical of claims that Zanu PF cannot win
a free and fair election. Given the state of opposition forces and the
simple fact that history doesn't have many examples of opposition parties
winning all seats in an election, there is little reason to credit it.
Instead we have seen that the worst dictatorships still have supporters.
I am naïve enough to know that we have never held a free and
fair election. I have never heard of a country under the sun that has held
free and fair elections. At best election results must reflect the will of
the majority. The difference between Africa and the US and European
democracies is that when challengers lose an election they concede defeat
and congratulate the victor. In Africa it is un-African to concede defeat,
which is far from saying elections are not rigged.
Wakatama was commenting on the Zimbabwe We Want document. What
alarmed me was the cynical slant taken, the opportunistic venom against the
church initiative. He implied that we were so delusional as to imagine that
the churches had raised their voice to "put things right". He had every
reason to be disappointed. Churches don't work magic and it is therefore
unfair to take their proposal as if they claimed supernatural powers for
themselves to influence the direction of politics by turning President
Mugabe into a saint overnight. They are only making a legitimate
contribution to national debate, a more constructive contribution than the
self-righteous noises of opposition politicians thus far.
It is helpful that the opposition MDC has been more reticent on
the document. The church initiative has become the latest butt for those who
over the past seven years have been radical in theory but cowardly in
practice. We have blamed Thabo Mbeki for his "quiet diplomacy" and praised
the West for its "megaphone diplomacy". None of them has worked in our
favour. And the churches are fully aware of those failures.
Threats of confrontation with the regime have come to naught.
The church has now become the latest scapegoat for the failed revolution by
providing "a breathing space for the regime". But blaming everybody else for
your failure cannot constitute a solution to the political crisis we face.
Wakatama talks of a "divided and confused" government. But when
it comes to self-preservation Zanu PF is more united than we imagine. It is
because opposition forces and civic society are so divided, so confused and
so petty-minded that Zanu PF has become smugly arrogant despite the
wasteland caused by its bad economic and political policies. It will take
more than an attack on alternative propositions to achieve a change of
government or policies.
If opposition forces want to make headway in the fight against
Zanu PF they will need to admit a few hometruths. Zanu PF is less vulnerable
now than when the MDC was formed in 1999. The MDC is itself much weaker
today than when it was conceived. When the MDC split in October last year I
pointed out in this column that the leadership had betrayed the people who
had been beaten, tortured, raped and starved in the name of change. I was
assured that there was no such split but that a "few malcontents" in the
leadership had left the party. There was the real MDC and the necessary
"numbers" to prove it. When the results of recent rural district council
elections were announced we couldn't see the numbers in Mashonaland West,
East and Central. Not even in the Kadoma mayoral election.
Which brings me to the other point - that we should not discuss
the National Vision document because everybody knows the solution to
Zimbabwe's political and economic crisis. Really? Are Zimbabweans so
masochistic they are deliberately prolonging their own suffering? Why hasn't
that foolproof solution been applied in the past seven years?
It is further claimed that Mugabe "never promised to abide by
the recommendations" of the National Vision. This is a self-invented
conclusion from the self-serving lie that Mugabe dictated the contents of
the document to the much impugned clerics. Recommendations are never
The contradictions can be staggering. How can Mugabe call for a
homegrown constitution and then turn around to say the Lancaster House
document is homegrown? Can anybody imagine Mugabe wanting to reduce his
powers by sharing them with a prime minister as proposed in the Zimbabwe We
If it is true, as alleged by those who think they own opposition
politics, that Mugabe dictated the National Vision document to the church
leaders, at least they achieved what the rest of the world has failed to
do - forcing Mugabe to concede that the national crisis escalated
"exponentially" with the advent of the fast-track land reform.
After seven years of a mutually destructive war of attrition
among political players, the churches are saying let's give peace a chance,
let's accentuate the positive against the negative, let's pick up the pieces
and build the Zimbabwe we want. I fail to see how this initiative is
inimical to the militant approach of amadoda sibili who have promised to
lead from the front.
Apparently, it is easier to fight shadows than the real enemy.
By Vincent Kahiya
OUR government never ceases to amaze especially when it comes to
penning legislation. The current desperate situation is - from the
government's perspective - one which can be put right by legislation and
That is why government feels it can legislate against poverty by
coming up with the Price Stabilisation Bill. It wants to come up with
legislation to ensure that figures from the Central Statistical Office are
Then this week Finance minister Herbert Murerwa told a Public
Accounts Committee that government was introducing new Bills to punish line
ministries that failed to produce accounts of funds from the fiscus.
"These Bills would be a milestone aimed at creating efficiency
and value for money," Murerwa reportedly said.
That is to say that the minister believes that efficiency in
accounting for government funds, curbing over-expenditure and all other
forms of fiscal prudence can be achieved through legislation.
With all due respect to the minister, I think he is missing the
point here because governments which have efficient systems of public
administration have not achieved this through volumes of legislation to
punish those who overstep set boundaries. Efficiency, accountability and
integrity are cultural norms developed by popular consent. This is easily
achieved if national leaders demonstrate a willingness to walk the talk.
Our civil servants have been told that they have to toe the Zanu
PF line. They have to work within the set parameters of party policy and
systems. Resultantly, this politicisation resonates in the public service
where inefficiency has become a virtue. The chaos at the Passport Office,
the absenteeism of teachers and shameless corruption at the border posts are
all part and parcel of Zanu PF's system of patronage.
I recall in the late 1990s when Registrar-General Tobaiwa Mudede
took us on a tour of the Births and Deaths Registry at KGVI. We were shown
the latest computer bank staffed by dozens of "highly-trained"
professionals. We were told queues would soon be a "thing of the past" and
that the waiting period for identity documents would be cut down to a week.
The computer equipment was no substitute for a culture of
efficiency as queues today are longer than they were five years ago despite
a reduced population.
The same is true of the envisaged legislation to force civil
servants to produce accounts on time and to account for every dollar spent.
This is a useless law, especially when Murerwa's ministry
continues to have an appetite to borrow for recurrent expenditure. It is
also futile because the central bank has a deliberate policy to crowd out
the private sector by borrowing for our wasteful rulers. RBZ governor Gideon
Gono has also told us that he will print more money to preserve national
security and avoid embarrassment. Will the law weaken Gono's vocation to
keep the presses running?
What the country requires are systems that promote openness and
these can be achieved by arming voters with accurate information. A
government can only enhance its efficiency and accountability if voters are
armed with the information they need to make certain that ours remains a
government whose legitimacy is derived from the consent of the governed.
Open government, of course, is one of the most basic
requirements of a healthy democracy. It allows taxpayers to see where their
money is going. It permits the honest exchange of information that ensures
government accountability, and it upholds the ideal that government never
rules without the consent of the governed.
Zimbabwe should move towards open government instead of adopting
punitive systems. Major obstacles to achieving open government include the
Access to Information and Protection of Privacy Act, the Official Secrets
Act and the Public Order and Security Act which have been used to
deliberately bully the public from scrutinising government.
Murerwa's resolve to achieve accountability will fail as long as
he does not have the public behind him. It is the public who demand
accountability and not just himself and colleagues in cabinet.
The public can only make such a contribution if there is
governance by consent. True consent of the governed requires something more
than just holding elections every four years. What we need is informed
consent. By reforming our information policies in order to guarantee true
access by all citizens to government records, we will revitalise the
informed consent that keeps our people free. Informed consent is impossible
without open and accessible government.
But sometimes human nature dictates otherwise. Elected officials
and government leaders want recognition for their successes but not their
failures. But in a healthy democracy we need to know the good, the bad, and
Abraham Lincoln put it best: "No man is good enough to govern
another without that person's consent."
GOOD news readers. Zimbabwe is not isolated as the Western media
President Mugabe was able to mix freely with seven other
presidents at the recent Comesa summit in Djibouti, the Herald told us. This
just goes to prove that the propaganda machinery of Western countries has
been lying about our predicament.
You may not have heard of Comesa, a half-baked customs
arrangement, or Djibouti, a barely existent state, but in 2003 it passed a
resolution calling for the removal of "illegal" sanctions. It also called
for Zimbabwe's suspension from the Commonwealth to be lifted in line with
calls from Presidents Olusegun Obasanjo and Thabo Mbeki.
It is a sign of how desperate the government has become that it
can dig up a 2003 resolution of a dysfunctional east African body and
proclaim it to be evidence of normality three years later!
President Obasanjo is cited as supporting the lifting of
Zimbabwe's suspension from the Commonwealth. But the state media has
reminded us at every opportunity that the Nigerian leader quickly shifted
This followed his realisation that he had been misled when he
was prevailed upon to send a letter to the Australian prime minister John
Howard claiming that the authorities in Harare were addressing shortcomings
in governance and human rights.
When Mbeki attempted to raise the issue of lifting Zimbabwe's
suspension at the Abuja Chogm, he soon found himself isolated.
So that leaves Comesa as cold comfort for the regime's
propagandists. Comesa was praised for sending observers to witness Zimbabwe's
elections when some of the Western nations that have endorsed sanctions
"have never sent observers to Zimbabwe".
The propagandists who are fed this junk assume Zimbabweans have
short memories. The EU adopted sanctions against Zimbabwe's leadership when
the head of their electoral monitoring team, Pierre Schori, was prevented
from observing the 2002 presidential poll. As for Comesa's Electoral
Observation Policy, we can be sure it involves a very tight blindfold!
But is this the best they can do? A 2003 resolution from Comesa
in which two leaders cited as Zimbabwe's key supporters are today no longer
quite so enthusiastic. There must be better news than this.
Somebody trying to work up some good news is Emcoz senior
vice-president David Govere. Speaking at the Emcoz convention, he forecast
that despite a bumpy start, "We are heading towards the inevitable recovery
of the economy in the second half of 2007."
He saw a "thawing of bad political relations", reduced
dependence on food imports, a reduced wheat shortfall, and "unwavering
determination by stakeholders" to rectify macro-economic fundamentals. This
would all lead to a fast-growing economy by 2010, he predicted.
We rather thought that Pollyanna, Mark Twain's little girl who
was enchanted by everything she encountered, lived only on the pages of the
Business Herald. But, it seems, her rose-tinted spectacles are also worn by
some of our business leaders.
Does Govere seriously think that inflation will come down when
there is no plan to tackle it and wasteful expenditure persists at every
Does he really think that with plummeting output on the land,
where politically induced instability continues, stoked by ruling-party
bigwigs, the economy will recover?
Does he think investors will sink their hard-earned cash in a
country where the rule of law has been suborned?
He admits that the first half of next year will be "fraught with
major challenges", a euphemism for failure. And he does concede that the
last seven years have been "seven lean years". But there the reality ends
and fantasy takes over.
"We are beginning to speak about the real issues on the National
Economic Development Priority Programme," Govere suggests.
So perhaps he can tell us what happened to the six-month miracle
cure we were promised when the programme was launched? What happened to the
US$2,5 billion investment that was expected? Which parastatals have been
We expect political leaders to throw dust in our eyes as they
seek to excuse their record of misrule. But naive forecasts of this sort
designed to please those who should be confronted with the hard truth do
nothing for the credibility of our business leaders.
Perhaps Govere shares with President Mugabe a secret formula.
Speaking in July, Mugabe told the country that forex inflows were beginning
to be felt.
"I won't say much now," he said, "but between now and December a
lot is going to happen."
He was right: inflation has gone up, employment has come down
and the forex flows never materialised.
The Herald carried an interesting snippet last week.
In its "50 Years Ago" column it reported the following for
November 1956: "During the past 10 years
1 677 dams have been built either by the Division of Irrigation
or under its guidance. Including the virtually complete Sebakwe Dam, these
give a total storage of 124 billion gallons. Under construction is the
Gwenoro Dam south of Gwelo which should be finished in 1958 and will hold 7
The Kyle Dam was on the drawing board, it was reported. It was
completed a few years later.
Meanwhile, the Kunzvi Dam still awaits construction 26 years
after Independence. Isn't this the government that said it would bring
development to correct the anomalies of the past?
On Tuesday this week the same column had a more sobering tale of
the state we are in today. Speaking in Shabani, the prime minister of
Southern Rhodesia RS Garfield Todd said one-third of the African population
should be farmers and two-thirds employed in industry and commerce.
"We stand at the beginning of our industrial era," Todd
observed, "but already we have 78 000 Europeans and 604 000 Africans in
We wonder what ratio of the population Zimbabwe still has in
formal employment today. We have now entered the era of de-industralisation
spawned by the Third Chimurenga.
President Mugabe last week lashed out at politicians who tell
lies to ingratiate themselves with the Zanu PF leadership, the Herald
reported on Saturday. At first we thought this referred to Industry and
International Trade minister Obert Mpofu and the looting at Zisco.
We were wrong. Mugabe told mourners at the burial of his
homeboy, Tony Gara, in Zvimba that a number of candidates who wanted to be
elected to the senate last year "told a lot of lies" that Gara was part of
the Tsholotsho gang that was opposed to Joice Mujuru's elevation to the
He blamed individuals in his party for trying to blemish Gara's
good name by linking him to the Tsholotsho affair in 2004 that cost several
provincial chairmen their posts in the party.
We wonder why this piece of information waited for two years
before being made public. It is also one of several wild allegations that
Mugabe makes when he has nothing better to say, like his now familiar claims
against his ministers that they consult witchdoctors in a bid to succeed
him. Why doesn't he name and shame them if there is an iota of truth to
In another note, the Herald reported that Zimbabwe Broadcasting
Holdings chairman Justin Mutasa had "dismissed as false" claims that Chris
Chivinge had been fired as Newsnet editor-in-chief.
He said Chivinge had not been fired "because he is serving his
notice on his contract of employment which ends on Thursday, November 30".
This however did not stop him from warning that ZBH would not
"condone irresponsible behaviour that displays insubordination and
This was one of the problems that needed to be "eliminated" at
ZBH, he said.
Mutasa did not say if Chivinge had resigned of his own volition.
Nor whether he was being made an example of to the rest of the employees.
It's all as clear as mud.
Zimbabwe, Iran think alike says President Mugabe," one news
agency reported this week.
Indeed they do. Both like to portray themselves as victims of
Anglo-American imperialist aggression. Both have rulers who like to posture
on the world stage; and both ruthlessly suppress dissent.
President Mahmoud Ahmadinejad is regarded as a dangerous
populist demagogue by Iran's civil society and the country's student
movement has been battling with the regime over freedom of expression and
But, we wonder, does President Mugabe agree with Ahmadinejad
that Israel should be wiped off the face of the map?
We liked the concluding paragraph of the Herald's report saying
that Mugabe would be visiting a tractor factory in Tabriz before leaving
The Herald is probably unaware that in the pre-1989 era a visit
to a tractor factory was mandatory for any leader visiting an East bloc
country. It quickly became something of a joke in the Western media as did
fictional reports of record output from such factories. Needless to say, the
tractors were not of a particularly high standard!
While Mugabe was visiting Iran, his Transport minister, Chris
Mushohwe MA, was assuring a gullible Comesa delegation, touring the
Whitecliff housing project, that Zimbabwe was successfully countering the
"bad image" that the British, Americans and Australians were trying to
portray. They were trying to portray Zimbabwe "as a country where there is
lawlessness and chaos", he suggested.
Over 700 000 people were rendered homeless by Operation
Murambatsvina. Most today have still not been rehoused.
There was support from the Namibians who clearly thought
dispossession of urban residents was a good thing. But was the Comesa
delegation given access to civil society or UN personnel concerned with
resettlement issues? And were they told that many of the recipients of
Garikai houses were well-connected ruling-party supporters?
No doubt that would have impressed them even more!
By Eric Bloch
IT was almost five years since the government first stated that
its policy on agricultural land tenure would be the issue of 99-year leases
to farmers, ownership of the land being vested in the state.
Over those years, there were repeated assurances that the issue
of the leases was imminent, that the leases would be available to all as
would use the lands productively, that they would entrench the farmers'
security of tenure and that they would be the foundation for the
long-awaited recovery of Zimbabwe's decimated agricultural sector.
The repute of the Zimbabwe government for fulfilment of policies
and undertakings has long been known to be implemented (if implemented at
all) at one of three speeds: slow, very slow and stop.
However, rarely has been governmental inaction as pronounced,
and inept, as has been the case of the farm leases. The government has
almost 20 million hectares of land available at its disposal, albeit that
despite its renowned, prolific and vociferous contentions to the contrary,
most of that land was unjustly and inequitably expropriated from legitimate
Fifteen years after enacting the Land Acquisition Act, more than
six years after declared intents of redistribution of the expropriated
lands, 20 years after much land vested in the government as a result of
purchases funded by the United Kingdom and five years after enunciating its
99-year lease policy, the government has granted 125 leases, encompassing an
aggregate of less than 1% of the land supposedly to be redistributed and
resettled. Big deal! What a spectacular achievement! At that rate, all the
land will have been leased to farmers by about the year 2500!
Nonetheless, there was great blowing of fanfares, and much
ceremonial, when a fortnight ago the first 125 leases were released to the
lessee farmers. Although the government is supposed (as part of its war
against inflation) to be curbing its expenditure, it unhesitatingly hosted a
massive shindig at the Harare International Conference Centre, graced by
President Robert Mugabe, the Minister of State for Security and Lands and
numerous other ministers and dignitaries as well as a deluge from the media
Mugabe implied that the issue of the leases, as commenced that
day, heralded the start of a new era for Zimbabwe. Not only did he contend
that the wrongs of more than a century were being righted, but also that the
future of agriculture was assured.
None can credibly argue that there were no wrongs perpetrated in
the past. These included the abhorrent Land Apportionment Act which was law
for over 40 years, unjustly and unacceptably barring indigenous and
non-indigenous black Zimbabweans from land ownership.
But there were commensurate wrongs committed by the present
government: its spurious, never-ending contentions that whites had "stolen"
the land, now expropriated by the government, remain as specious as ever.
In fact, in its iniquitous commandeering of land ownership,
devoid of regard for international precepts of justice, for human rights,
for enforcement of law and order, and without fair compensation, the reality
is that the government has done exactly that which it has repeatedly alleged
were the offences of the past.
However, commensurate in magnitude, to that government offence,
is that in committing it, the government has brought the entire economy to
levels commensurate with the greatest poverty prevailing worldwide, has
alienated most of the international community and, directly relevant,
reduced most Zimbabweans to near starvation. That contrasts with only 10
years ago, when not only did Zimbabwe wholly feed itself but also much of
The tragedies do not end there.
Key factors driving a successful agricultural economy include
that the farmers have security of tenure, and that they have access to
funding the development and working capital. It must be acknowledged that,
to some extent, the leases may give security of tenure; prima facie, they
are to endure for 99 years.
That security is an essential if lessees are to be motivated to
develop and improve the farms, for none will risk capital and effort if they
fear imminent loss. But, the security of tenure is not assured.
On the one hand, the government has vividly demonstrated its
disrespect for tenure laws, readily overturning them, in its enactment of
the Land Acquisition Act, and numerous amendments thereto, and then
implementation thereof. How can farm lessees be assured that the government
will not, in the future, similarly renege on its leases?
On the other hand, the government also reserves the right to
terminate leases where the lessees do not properly work and exploit the
farms. In theory, there is some justification for that right, but the
inequity is that the government retains for itself the determination whether
or not the farms are effectively used. Thus the government will be
prosecutor, judge and jury while the lessees' rights of "defence" are
minimal, not even including an entrenched protection of "vis majeure",
otherwise known as "acts of God".
Therefore, the assurances of security of tenure are naught but
an elaborate façade, which may well result in many not proceeding on their
farm development with commitment and conviction, whereupon the government
can validly give effect to termination provisions!
Compounding the lease farce is the government's contention that
the leases accord the lessees collateral to secure borrowings. That
contention is founded upon provisions that while the land may not be
encumbered, the improvements thereon can be offered as security for funding.
Furthermore, the government states that if there is a change of
lessee, then lenders can look to the new lessee for repayment of such loans
as secured by the collateral of the improvements. The sad reality is that
these provisions demonstrate a total lack of any realistic appreciation of
private-sector provision of loan funding.
A lender needs to know that collateral is readily realisable,
should realisation be necessary in order to recover unpaid loans. To achieve
that, the collateral must be freely disposable, albeit usually by public
auction initiated by the deputy sheriff. That is not possible in instances
where a lender defaults, but remains the farm lessee, unless the
improvements are wholly moveable.
Similarly, when a new lessee moves on to the farm, and
notwithstanding that the government states that he will then be liable to
the lender, there is no effective recourse against him unless the
improvements are moveable, or the new lessee has other assets which can be
lawfully attached and disposed of.
Therefore, despite everything the government has said to the
contrary, the farm leases have no collateral value or, at the least, very
little, and therefore the likelihood of the financial sector being able or
willing to provide the new farmers with requisite finance is remote in the
Worsening the situation further, the government has now
abdicated from its lawful obligation to compensate former farmers for the
improvements they had effected, for it has now transferred that obligation
to the new lessees. Once again the government is wiping its hands of legal
and moral obligations. In the process, it is burdening many lessees with
I've never been against unity, says Sikhala
"THERE is strength in Unity", (Zimbabwe Independent Comment,
November 17) refers. There is no doubt that your paper occupies an important
space in the field of information dissemination and its balanced reporting
no doubt immensely contributed to the upsurge in readership as compared to
other papers whose readership remains stagnant for practising advocacy
This difference should be kept so as to keep yards ahead of
those we hear have their stories written and edited in public drinking
places with bills of beer being paid in advance.
"It is no comfort to hear that this intransigence was reflected
in the ranks of Mutambara's faction. St Mary's MP Job Sikhala, deputy
secretary-general Priscilla Misihairabwi-Mushonga and Nkayi MP Abedinigo
Bhebhe argued vociferously at their meeting against unity," we are told.
I heard this statement for the first time from Jameson Timbe,
who over some bottles of beer in the Quill Club, told our party spokesman
Gabriel Chaiva: "Sikhala is against unity."
I called him and warned him against spreading heresy. If it was
manifest of an opinion, it could be accepted. To vouchsafe it as fact is
The facts stand as follows: The said Misihairabwi-Mushonga was
not in attendance at the national executive meeting. She was already a week
out of the country defending her masters degree dissertation at a University
in the UK.
Secondly, no such subject was on the agenda. Only through the
report of the secretary-general was there a mention of progress so far made
in narrowing our differences. The issue of arguing "vociferously at their
meeting against unity" is as untrue as the source of such unfounded
allegations coated with mala fide intentions.
I am no coward contrary to the lie being peddled around that
there is a coterie of individuals bent on frustrating the reunification
process because they will lose their positions in the event of unity.
Unity has been my first prize as pronounced by the president of
the party, Professor Aurthur Mutambara. I am on record advocating for unity
and urging the elders of the party to talk to each other.
Positions have never been part of our agenda. I am one of the
founders of the MDC. We bore the idea, foundation and construction of the
MDC. It is Zanu PF nonsense that the MDC is a British and American creation.
We know how we started it. Ask Morgan (Tsvangirai). He knows it all and
Furthermore, some of us have been in combat against the enemy of
our people for a long time. Those who breastfed from Zanu PF did not know
the challenge we were facing. We have seen it all. We slept in caves,
mountains, ravines and maize fields in combat against the regime. Our
private parts were burnt during torture to kill the spirit of resistance.
I am the most incarcerated member of the opposition in the
history of this country since 2000. I have had more than 30 arrests and
appearances in courts of law and had acquittals in the majority of them. No
spike of fear was ever induced.
What kind of fantasy is that; I am afraid of unity? That is
nonsense. Such issues of national importance should have their venues moved
from beer halls to places of decency if we are serious to overthrow
this dictatorship. Spreading heresy when buying everyone beer in
the Quill Club and behaving like a village bully makes a mockery of all
negotiations without prejudice.
Bhebhe is laughing his lungs out.
"The bull of Nkayi" is the only opposition MP who routed Zanu PF
hands down during the recent rural council elections after winning 15 out of
21 seats at contest, leaving Zanu PF clinging to a paltry six.
Mr Editor, it is important to check with your sources the
authenticity of some claims so as to avoid pedestrian arguments. We were
also available for our opinion before being unfairly labelled "political
hawks" who "wish to pursue this senseless feud".
MDC Secretary for Security,
Intelligence and Defence &
MP for St Mary's.
Could the governor please explain ...
By Concerned Citizen
THE Reserve Bank of Zimbabwe (RBZ) that you head was
involved in the procurement of fertiliser from South Africa yet your
November 11 press statement on the RBZ website did not address pertinent
issues. For that reason, answers to the following questions are required:
* Are you aware of the state procurement policies,
procedures and regulations?
* Did you or any of your officers have any contact with
the State Procurement Board (SPB) over the fertiliser issue? If you had such
contact, can you explain it?
* When and how was the decision to import fertiliser made?
* Who (respective officials and institutions) were
involved in the decision (to import the fertiliser?)
* What were the total foreign currency requirements for
the three local fertiliser companies to recover their production capacity?
* How many tonnes would have been produced by the local
companies if there was adequate foreign currency?
* Was the fertiliser tender publicly floated? By who,
where and when did it close?
* What were the product specifications?
* How many suppliers tendered to supply? What are their
* How many suppliers won the tender and at how much? What
are their names?
* Who was on the selection panel?
* Can you provide a half-page profile of each of the
suppliers who won the tender? (Who are the shareholders, directors and
managers for the company and how long have they been in business? Who else
have they done business of this magnitude with?)
* Are the suppliers who won the tender manufacturers or
retailers/agricultural commodity brokers?
If they are manufacturers, where are their plants located?
If they are an agricultural product commodity broker, where did they procure
the fertiliser from?
* Who was and is the contact person for Zimbabwe in this
* Who structured the finance for Zimbabwe and for how many
tonnes? What were the terms? What was the role of Nedbank and the Rand
* How and when were the suppliers paid?
* What was the price per tonne?
* How much has been paid so far and for how many tonnes?
* Any other information you may find useful to a citizen
Looking forward to your timely response.
* Concerned Citizen is a pen name for a writer based in
Gideon Gono's involvement cries for probe
THE fertiliser importation saga refers.
I did a company profile search on the Internet on
the following South African news sites: www.google.co.zw;
www.businessday.co.za; www.busrep.co.za; www.mg.co.za;
www.financialmail.co.za and www.iol.co.za on the South African fertiliser
supplying company Intshona Agriculture Products.
www.iol.co.za publishes stories from 14 South
African newspapers under the Independent News & Media stable. The search
yielded nothing about the company except a story attributed to the RBZ
governor published on June 28 by www.iol.co.za sourced from Reuter news
Given the appetite the South Africans have for media
coverage whenever an empowerment deal is sealed, it is surprising that the
so-called Intshona Agriculture Products escaped the attention of the
The Sunday Mirror claimed that Intshona Agriculture
Products is a Black Economic Empowerment (Bee) company. If this is true, how
would it escape the attention of the media in South Africa?
An online news item on June 29 alleged that Intshona
executive director is a lady called Dr Crista van Louw. A similar Internet
search about her produced no results!
There is a website of a company called Intshona
www.intshona.com that supplies "All SeasonsT UHT Long Life Full Cream Milk",
whose contact person is a Lambertus Louw. The website has no other details
except a Malmesbury, Western Cape telefax number, +27 22 482 2858.
An online name search on the South African Companies
Registration Office (Sacro) website:
www.cipro.co.za/registration_forms/reg_forms.asp reveals that Intshona
Agriculture Products is a company related to Intshona Milk Products and only
registered on April 5 2005. Its enterprise number is 2005/010852/07.
Can someone go to South Africa and check what can be
found at AM Trust Building, 5
Church Street, Malmesbury, Western Cape, which is
the company's registered business address. One shudders to think that a
company registered in April 2005 has a manufacturing capacity. We are then
forced to assume that Intshona Agriculture Products is an agricultural
commodity broker, just like Rarefield Investments (Pvt) Ltd, whose major
shareholder and CEO is Walter Mzembi, the MP for Masvingo South. Mzembi
chairs the Parliamentary Portfolio Committee on Lands, Land Reform,
Resettlement and Agriculture and was present when the fertiliser deal was
unveiled, posing a serious conflict of interest.
On page 10, in the November 11 press statement, the
RBZ governor said about this company: "In the case of Intshona, who are one
of the contractors that have unfortunately been labelled as fly-by-night
brief-case traders...Contrary to newspaper reports that Intshona was a small
operation of no fixed abode, Intshona are instead a formidable force to
reckon with, not only regionally but also internationally."
Can he repeat this statement with such a startling
exposure about the supplier?
It is also surprising that such a purportedly
high-level deal escaped the attention of the online Nedbank Media Centre in
which its head of structured corporate finance, a fictitious Mr Dean Lavits,
is said to have been involved - www.nedbank.co.za. This is an institution
that collects and places on its official website any media article
mentioning its name and activities.
If this was a rightful responsibility of a
government (which it is not) to import fertiliser for resale, someone must
account to the nation how the Reserve Bank governor Gideon Gono is found in
the thick of things beyond allocating foreign currency.
He and the Ministry of Agriculture want to destroy
our own local fertiliser companies - Sable Chemicals, Zimbabwe Fertiliser
Company (ZFC) and Windmill indirectly after their earlier efforts failed to
create a monopoly by nationalising them. How much foreign currency did they
collectively require to recover the production capacity?
In the same press statement the governor said: "At
current structures, the fertiliser industry is overly concentrated in a web
of a few intertwined owners, which breeds room for collusive behaviour, at
the detriment of the country's agricultural sector. There is, therefore need
for these complex ownership structures to be simplified in a manner that
stresses on productive efficiency."
We should interrogate this remark by showing the
owners of the three fertiliser companies in Zimbabwe. According to the
Privatisation Agency of Zimbabwe (PAZ) website and the MBendi online
directory of organisations, Chemplex, the wholly-owned subsidiary Zimbabwe
Phosphate Industries Ltd (Zimphos) owns, through a combination of direct and
indirect holdings, 50% of ZFC Ltd.
Shareholding thus consists of Chemplex Corporation
(50%), TA Holdings (22,5%) and Norsk Hydro, a Norwegian conglomerate (27,5%)
and Yara Zimbabwe, a subsidiary of Yara, another Norwegian multinational.
ZFC has two fertiliser plants and is the largest
fertiliser manufacturer in Zimbabwe.
Through a 50% equity stake in Fertiliser Holdings
Ltd and a 26% stake in Chemical & Gas Holdings (Pvt) Ltd, Chemplex has a
strong position in Sable Chemicals Industries, which is the sole Zimbabwe
manufacturer of ammonium nitrate. ZFC is the largest customer.
The government holds 36% equity in Sable.
Diversified local conglomerate TA Holdings is also a key shareholder in
Sable. Norwegian firm Yara, which wholly-owns Windmill, is also an investor
in Sable Chemicals with 11% of the shares.
From these shareholding details, two of the
fertiliser companies can be considered to be very local. Is Gono alleging
"sabotage"? Is this not simply malicious? Why is he showing resentment
towards foreign shareholders in two of the companies yet he is part of the
national efforts to bring in foreign direct investment?
The fertiliser issue is so embarrassing and
scandalous to say the least. We have had similar incidents where the RBZ is
said to have been heavily involved.
Let's revisit the procurement of fuel, grain, wheat,
agro-chemicals and agricultural equipment. Who are the parties involved, who
can tabulate the step-by-step process involved and to what extent was the
procurement rule book flouted or followed? Icho!
Analysts stuck in never never land
ERIC Bloch has written extensively on the need
His economic arguments are clear and
compelling. That the Zimbabwe dollar is grossly overvalued is obvious to
However, Bloch's economic analysis again fails
to deal with the realities of the Zimbabwean situation, thus he has failed
to mention the most important reason why there has not been any significant
The market distortions, such as exist for
foreign currency, fuel and other commodities, create too many opportunities
for the chefs to add more millions to their already bulging bank accounts.
It is they who create the market distortions and they who subsequently
exploit them for personal gain.
If the governor of the Reserve Bank is a man
of integrity, and if he genuinely wants to see an economic turnaround, then
there is only one course of action for him to follow: resign and join the
struggle to rid Zimbabwe of those who have destroyed it economically,
politically and socially.
Any economic analyst whose analysis ignores
our political realities is like a local doctor who prescribes the latest
medications for destitute patients.
It's the politics, stupid! Any analyst who
fails to grasp this simple truth will always remain stuck in never never
It's a good starting point
IT was refreshing to read the Candid Comment
"Biggest sin bishops committed", (Zimbabwe Independent, November 10).
Dialogue is the way to go and the Vision
Document is a vital step in that direction. Oppressive regimes will remain
oppressive but engaging them will help to free them from the siege mentality
they are under. A journey of a thousand miles begins with the first step.
When President Mugabe said he wanted
dialogue between Harare and London through the mediation of Benjamin Mkapa,
it was believed this was the only way the crisis in Zimbabwe would be
Bishop Trevor Manhanga and team have just
tried their hand at achieving this but to our utter surprise, these
so-called activists are ganging up against them.
Whether the Vision Document was edited by
President Mugabe or not, it is still a good starting point. Criticising just
for the sake of it is unhelpful.