Hardliners arm twist Mugabe

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

Thursday, 06 October 2011 18:51

Faith Zaba

PRESIDENT Robert Mugabe is under pressure from hardliners within Zanu PF and
security chiefs to convene an extra-ordinary congress to endorse him as the
presidential candidate and rejig the politburo.

This comes as Mugabe told the party’s central committee yesterday that the
MDC formation led by Prime Minister Morgan Tsvangirai must resign from
government if it is opposed to the indigenisation programme.

Zanu PF’s campaign mantra for the general election, which Mugabe wants early
next year, is empowerment of black Zimbabweans — a message which he will
hawk at the party conference in Bulawayo in December.

Mugabe said the Bulawayo conference was not just an ordinary conference
because it precedes elections, which are due after the present
constitution-making process.

“We are two months from the national people’s conference,” Mugabe said. “As
it precedes the year of elections, that fact necessarily gives that
conference the status of a congress. It gives this conference a higher
status than an ordinary conference,” he said.

But  party officials and security chiefs told the Zimbabwe Independent this
week that Mugabe should declare the conference an extra-ordinary congress,
which they said would allow for his endorsement as the presidential
candidate for elections and to re-arrange the politburo so that those
exposed in WikiLeaks cables are dealt with.

Top party officials like Vice-Presidents Joice Mujuru and John Nkomo,
Indigenisation and Empowerment minister Saviour Kasukuwere, politburo
members Sikhanyiso Ndlovu and Jonathan Moyo were quoted in WikiLeaks cables
after meeting US diplomats.

One senior party insider said: “There is nothing like an ordinary conference
with the status of a congress. It’s either the December meeting is an
ordinary conference or it’s a congress and President Mugabe must come out
clearly and call it by its correct name, which is a congress. Why he should
declare it an extra-ordinary congress is because it will allow the provinces
to nominate their presidential candidate for the elections.”

A top army officer said declaring it an extra-ordinary congress would allow
Mugabe to reconfigure the politburo to deal with party officials who met US
diplomats and told them that Mugabe must resign.

When Mugabe officially opened the party’s central committee meeting in
Harare yesterday, he made no mention of the WikiLeaks cables but spoke at
length about the need to speed up the indigenisation and empowerment
programme.
He said the MDC-T was opposed to the government’s indigenisation and
empowerment law, which forces multi-national companies to cede 51% control
to locals.

“If they no longer support our people-oriented policies, let them resign
from government first and then mobilise against those laws which they
supported and passed only yesterday,” Mugabe said.

“Anyway, those miners, industrialists and bankers who think the MDC
formations can save them from a national policy will only have themselves to
blame. We do not make policies in vain. I have instructed (Indigenisation
and Empowerment) minister (Saviour) Kasukuwere to move with full speed on
this matter which must see a greater thrust soon. He should not be impeded,”
he said.

Mugabe said his party would never allow foreigners to own more than 50%
shareholding in companies operating in Zimbabwe.
“Never again, Never ever ever again should we give the majority shareholding
to outsiders. It should be at our level of 50% and in some cases it should
be much less. Once bitten, twice shy,” he said.

Commenting on elections, Mugabe declared that Zanu PF would not make the
same blunder as it did in 2008 when it lost presidential elections to the
MDC-T’s Tsvangirai.

Mugabe vowed that elections would be held next year without fail.
“We must have polls which put an end to this dysfunctional political
arrangement – the inclusive government which has served this country not as
we desire,” he said.

“Already, we have lost three years of potential development. We cannot
afford to go on in this indecisive, if not negative, way. We must put an end
to this ugly political scene that is in our country.”

Mugabe said there was need for a selected number of central committee
members from the three political parties in the coalition government to meet
and agree on how to end politically-motivated violence.

“Truly speaking, let us work for peace. Peace, not just because we want to
see our elections not tarnished by violence, but because we want to see our
societies live in peace. Let us beat them by the nature of our policies and
not beat them by way of fists. There should be a meeting of central
committee members and an equal body of the MDCs to discuss the issue of
peace, especially now as we move towards elections so that people can
canvass and campaign freely,” Mugabe said.

MDC-T suspends minister over US cables

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

Thursday, 06 October 2011 18:41

Faith Zaba

THE MDC-T Harare provincial executive last week suspended its spokesman and
Justice and Legal Affairs deputy minister Obert Gutu for describing Prime
Minister Morgan Tsvangirai as an inept, weak and indecisive leader during a
meeting with US diplomats.

MDC-T Harare provincial chairman Paul Madzore on Wednesday confirmed to the
Zimbabwe Independent that the provincial executive had suspended Gutu last
week over statements he made to US ambassador Charles Ray in January 2010.

“It is true that we suspended him as the provincial executive and the
suspension was indefinite, but we are thinking of lifting it soon,” said
Madzore. He said Don Chiringa, an official in the prime minister’s office,
was now the acting provincial spokesman.
However, Gutu said he was unaware of the suspension.

“Where did you hear that?” asked Gutu. “That’s news to me.”MDC-T
secretary-general Ten-dai Biti said the provincial executive had no power to
suspend Gutu.

“That is not true because the provincial executive has no power to suspend
Gutu,” said Biti. “It is the national executive that can do that. The
provincial executive has not communicated with us on that issue so it is not
true that Gutu has been suspended,” Biti said.

The suspension flies in the face of the party’s national executive committee’s
decision to ignore WikiLeaks cables which exposed four top party officials,
namely national organising secretary Nelson Chamisa, national treasurer Roy
Bennett, Biti and Gutu.

Tsvangirai last week dismissed the cables as mere gossip, saying he did not
consider WikiLeaks cables as reliable information.
“Our party regards WikiLeaks with suspicion,” said Tsvangirai. “We can’t
follow rumours and we cannot run a country on gossip. We are not doing
anything about that and that’s where it ends,” he said.

According to the leaked cables, Gutu said Tsvangirai had a tendency to
listen to the wrong people. He singled out Ian Makone, Tsvangirai’s chief of
staff, and his wife Theresa, the co-Home Affairs minister.

“He opined that neither was a good strategist and that the office of the
prime minister was weak due to Ian Makone’s lack of leadership,” read the
cable.
Gutu also claimed that Tsvangirai practised nepotism and cronyism when it
came to appointing senior people to party and government positions.

“Gutu noted that (Murisi) Zwizwai and Tsvangirai are cousins and this is
another example of friendship getting in the way of governance,” read the
cable.
Zwizwai was then the deputy minister of Mines and is now the deputy minister
of Media, Information and Publicity.
Chamisa, the Information Technology minister, was quoted saying the office
of the prime minister was weak.

“We asked Chamisa about a common perception that the office of the prime
minister was weak and had failed to play a coordinating role of government
ministries. Chamisa agreed.”

Chamisa also said: “Ian Makone, Tsvangirai’s chief of staff, was
ineffective. But Makone was a good friend of Tsvangirai and it was unlikely
that Tsvangirai would make a change.”

Bennett was quoted saying Tsvangirai remembered the advice of the last
person he had spoken to, while Biti criticised his boss for lacking a
strategic plan for the MDC in government.

Biti was described by former US deputy chief of mission at the Harare
embassy, Katherine Dhanani as ambitious.

“Biti is ambitious and undoubtedly sees himself as the heir apparent and he
does differ with Tsvangirai on tactics,” said Dhanani in a cable to
Washington in July 2009.

‘Nationalise diamonds’

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

Thursday, 06 October 2011 18:40

Paidamoyo Muzulu

MDC-T MPs have called for the government to nationalise all alluvial
diamonds and revise the much maligned indigenisation policy to improve the
country’s economy and control of mining resources. This is according to
motions introduced in the House of Assembly on Wednesday.

The motions were moved by Eddie Cross and Alexio Musundire opening a fresh
battlefront for the MDC-T and Zanu PF in the chamber.
Zanu PF has for a long time made indigenisation and diamond mining its
preserve in all debates on the national economy.

Zimbabwe recently discovered alluvial diamonds in Chiadzwa near Mutare,
prompting a flurry of mining activities and interest from foreign companies.
However, marketing of diamonds in the country is done opaquely and outside
the Kimberley Process.

Cross gave notice to the House that he would move a motion calling for the
nationalisation of all alluvial diamonds in the country.

“I move that the House take note that tomorrow I will move a motion to
nationalise and prescribe all Marange diamond fields,” said Cross on
Wednesday. “Since the discovery of diamonds in 2006, the process of mining
has been done opaquely,” Cross said.

Finance minister Tendai Biti has on several occasions spoken on revamping
the diamond sector by introducing a Diamond Bill to bring transparency into
the operations at Marange diamond fields.

Chiadzwa is presently exploited by the government through the Zimbabwe
Mining Development Corporation in partnership with Chinese companies. The
mines are estimated to have a lifespan of 14 years.

The changes, if effected, would affect the mining operations at Chiadzwa.

On the other hand, Musundire called on the government to review the
indigenisation policy currently scaring away foreign direct investment.
“I will move a motion seeking the review of the indigenisation policy,” said
Musundire. “There are a number of issues that need to be clarified and allow
the government departments to share the same views on the policy,” Musundire
said.

Implementation of the indigenisation policy by Youth and Indigenisation
minister Saviour Kasukuwere has sent shivers in the market and rancour among
the coalition partners. Kasukuwere is compelling all foreign companies to
submit their indigenisation plans to his ministry outlining how they would
offload 51% equity to locals.

Zanu PF MPs seem ready to defend the status quo since their party has made
indigenisation and economic empowerment part of its manifesto for the next
elections set for 2012.

Zim’s poor human rights record under scrutiny

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

Thursday, 06 October 2011 18:22

Dumisani Muleya in Geneva

ZIMBABWE’S atrocious human rights record will come under hawk-eyed scrutiny
on Monday at the United Nations Human Rights Council’s periodic review in
Geneva, Switzerland, when the country presents its national report on the
human rights situation to a sceptical audience.

Over the past decade Zimbabwe has been hogging international attention due
to political repression and concomitant human rights abuses which span
President Robert Mugabe’s chequered 30-year rule. From the Gukurahundi
massacres in the 1980s through Murambatsvina in 2005 to the 2008 killings,
the country has seen some of the worst atrocities in the region which have
sparked international outrage.

Although the UN periodic review system is not adversarial, the Zimbabwe
situation is likelyto erupt into confrontation because government and civil
society groups have been engaged in fierce battles for hearts and minds
behind the scenes.

Senior UN and country diplomats who spoke to the Zimbabwe Independent off
the record said Zimbabwe’s situation continues to “worry many countries and
their leaders around the world”.

“Naturally Zimbabwe’s political and security situation is worrying many
leaders and countries around the world,” a senior African diplomat said.

“As African countries we need to ensure the country holds free and fair
elections and embarks on a democratic path where the rule of law and human
rights are upheld and respected. That is why behind the scenes there is so
much activity and manoeuvres on Zimbabwe. It’s always one of the test cases
during such high profile meetings.”

A top Western diplomat said: “We need to be firm on these countries because
human rights abuses whether in the United States, Syria or Zimbabwe must be
viewed seriously because they are outrageous. The good thing about the
periodic review is that all UN member states are subject to scrutiny and
this time Zimbabwe and other countries are in the dock. We will take them to
task.”

While the government is banking on the support of African countries which
are mainly fighting in the same corner to avoid exposure over their
appalling human rights situations, Zimbabwean civic organisations are also
pulling out all the stops to secure support for their position. Civil
society leaders who have descended on Geneva have been holding meetings on
the sidelines of the main sessions to lobby for support. They have produced
photo-exhibitions showing recent cases of political violence and brutality.

Civic groups have compiled an advocacy charter which has been distributed to
stakeholders, including the Office of the United Nations Human Rights
Council headed by Navanethem Pillay of South Africa.

The OUNHRC works to promote and protect human rights guaranteed under
international law.
Their report is designed to counter Zimbabwe’s official document which
glosses over issues and paints a glowing picture of the situation. Justice
minister Patrick Chinamsa, already in Geneva, is expected to present the
official report on Monday against a background of diplomatic scepticism and
even hostility from some countries. His report is bound to cause a stir as
it seeks to whitewash the situation and claims progress in the protection
and promotion of human rights in Zimbabwe.

Chinamasa’s report, already circulating among diplomats, claims Zimbabwe has
made progress in improving its human rights situation, citing treaties and
international instruments signed and ratified by government such as the
Convention Against the Elimination of all Forms of Discrimination Against
Women, International Covenant on Civil and Political Rights, International
Covenant on Economic, Social and Cultural Rights, Convention on the Rights
of the Child and International Convention on the Elimination of Racial
Discrimination.

However, Chinamasa’s report does not explain why Zimbabwe has not ratified
outstanding human rights treaties and their optional protocols such as the
UN Convention Against Torture, Cruel or Inhuman or Degrading Treatment or
Punishment, and International Convention for the Protection of all persons
Against Enforced Disappearances.

Zimbabwe has also not ratified protocols such as the Convention Against the
Elimination of all Forms of Discrimination Against Women, International
Covenant on Civil and Political Rights, International Covenant on Economic,
Social and Cultural Rights, the Convention on the Rights of the Child.
This will put Chinamasa under pressure to explain the discrepancy between
his report and the situation on the ground. Tanzania and Swaziland had a
tough time at their periodic review sessions, although most of the criticism
mainly from Western countries was directed at the King Mswati’s government.
South Africa was relatively robust on Swaziland, while Lesotho sang praises,
which left diplomats in stitches, for the Swazi Kingdom.

Chinamsa will also cite as evidence of progress the formation of the Human
Rights Commission, Anti-Corruption Commission, Zimbabwe Media Commission and
the Zimbabwe Electoral Commission. But questions are bound to be asked about
what government has done to ensure the legislative framework for these
commissions complies with international norms and standards.

The minister will also cite constitutional provisions which prohibit
discrimination on grounds of sex, gender, colour, race, creed and ethnicity
as evidence of progress. He would also say Zimbabwe has an effective
national gender policy which has seen high levels of female enrolment at
institutions of learning but queries will be raised around property rights
in all unions or marriages and inheritance cases.

Chinamasa’s report also claims progress on economic, social and cultural
rights. It basks in the glory of Zimbabwe’s high literacy rate, despite
falling educational standards, the national HIV/Aids strategic framework,
policies on housing and policies on agriculture, indigenisation and
empowerment. The controversial indigenisation campaign is likely to trigger
a storm.

Chinamasa’s report also claims progress based on constitutional provisions
against torture. “Zimbabwe’s constitution guarantees freedom from inhuman
and degrading treatment. There is a police complaints desk in Zimbabwe.
Zimbabwe has incorporated the rights to a fair trial and access to justice
in its legal system,” the report says. “There is a system to support victims
of crime such as Victims Friendly Court and units at police and hospitals,”
it says.
It also mentions the right to liberty, genuine periodic elections, freedoms
of expression, assembly and association, protection of the rights of
vulnerable groups such as prisoners, people with disabilities and children.

Civic leaders are challenging this, pointing out that while some of these
rights exist on paper protected by constitution and laws, the problem has
been the lack of the rule of law, human rights abuses and impunity on the
ground.

“The challenge in Zimbabwe is not such about the lack of constitutional
provisions and laws which guarantee human rights but implementation.
Government must respect the letter and spirit of the constitution and the
law. It must come up with reforms to improve the protection and promotion of
human rights,” said Zimbabwe Lawyers for Human Rights director Irene Petras.
“It’s the political and practice which matters most in the case of Zimbabwe
because having laws in place is one thing and applying and respecting them
quite another.”

US softens stance on Zim

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

Thursday, 06 October 2011 18:19

Wongai Zhangazha in Washington DC

THE US ambassador to Zimbabwe Charles Ray said the local economy was on a
serious recovery path and has encouraged American businesses to carry out
proper research and invest in the country.

Ray made these remarks at the US-Africa Business Summit in Washington DC on
Wednesday. The three-day summit was organised by the Corporate Council on
Africa comprising large American private companies.

In a departure from Washington’s previous policy, Ray embarked on a crusade
to lure sceptical American investors to do business with Zimbabwe.
Representing the Zimbabwe business community were the Bankers Association of
Zimbabwe, Cargill Zimbabwe, Deloitte Zimbabwe, Zimbabwe National Chamber of
Commerce, Mimosa Mine, Paramount and Old Mutual, among others.

Addressing the summit in a forum titled “Doing Business with Zimbabwe”, Ray
said investor interest in Zimbabwe had been affected by serious
misconceptions about the country’s economic policies.

“How Zimbabwe risk profile matches today with your firms orientation is a
matter for each of you to decide, but let me assure you that Zimbabwe is
changing and it’s changing relatively quickly with investors from as far as
Russia, Brazil and China having visited Zimbabwe in recent months to explore
business opportunities and America’s presence remains fairly limited,” said
Ray.

Despite policy inconsistencies, the International Monetary Fund has noted
that Zimbabwe’s economy has been growing faster than any other country in
the Southern Africa region since 2010.

Bilateral trade between the US and Zimbabwe grew by 18% in 2009-2010. In
2010, US companies sold goods worth US$68 million to Zimbabwe, according to
official statistics.

Ray said: “My embassy wouldn’t be focusing on building relations or these
kind of commercial linkages if we were not confident of opportunities that
exist throughout Zimbabwe. This is not to say that Zimbabwe is without its
own risks or challenges. There continue to be some political divisions
within the country. There is also willingness on our side to move the
political processes forward and I believe a broad recognition of political
value of stability to economic recovery.”

In his pitch to the investors, Ray also cited his meeting last month with
President Robert Mugabe saying he was assured that Harare was ready to do
business with the US.

Ray said it would be pointless spending a lot of time talking and obsessing
about what happened in the past and urged that focus be put on how to
accommodate the present and move to a brighter future.

The summit on Zimbabwe, Ray said, had been successful because it had brought
people together who otherwise might not have come together, but more
importantly, it had started the process of erasing some of the
misperceptions and providing some balanced information about Zimbabwe’s
investment climate.

In response to some of the issues raised by investors on land reform and
indigenisation, Ray said it was a problem but one had to examine the whole
issue.

“I like that they talk about local empowerment. It’s a far better word than
indigenisation. Empowering local people to benefit from their resources and
to have some say in their lives is a perfectly laudable goal and I am a 100%
behind it. If it’s done according to the law and when it’s done in a way
that truly empowers the people who have been disadvantaged, I am 100% for
it,” Ray said.

Zimbabwe’s ambassador to the US, Machivenyika Mapuranga, said the summit
marked a new chapter in serious engagement between Zimbabwe and US bilateral
relations.

He said the “empowerment policies pursued by the Zimbabwe government are not
nationalisation policies let alone expropriation”.
Mapuranga called on the US to repeal targeted sanctions imposed on Mugabe
and his inner circle arguing that they were major impediments to normal
business relations between the two countries.

In response, Ray said he had no power to remove the sanctions saying it was
the prerogative of the US Congress and Senate.
Ray said the US was ready to engage Zimbabwe and Sadc on the matter,
although both sides should strive to reach common ground.

Gono to supply personal debts record

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

Thursday, 06 October 2011 18:07

Paidamoyo Muzulu

RESERVE Bank of Zimbabwe (RBZ) governor Gideon Gono on Monday promised to
give parliament a full schedule of his personal and business loans from
local financial institutions, as well as those of the central bank, amid
widespread claims that he was reluctant to act on certain financial
institutions because of his relationship with them.

Gono made the promise to the Budget and Finance Portfolio Committee after
being questioned about his personal indebtedness and that of senior RBZ
officials to financial institutions

The question arose from speculation in the market that Gono and central bank
officials did not promptly act on troubled Renaissance Merchant Bank’s
financial woes because they also owed the institution substantial amounts of
money.

Gono admitted that he owed money to RMB in his personal capacity and through
companies associated with him. He also revealed that some senior RBZ
officials had debts with troubled financial institutions.

“There are individuals who are exposed to RMB in their personal capacities,”
said Gono. “The governor and companies related to him are also indebted to
the bank. I have been a client of RMB for the past nine years. In fact from
its inception,” Gono said.
Committee chairman Paddy Zhanda asked if Gono could avail a full schedule of
his debts before the committee to which Gono responded: “I promise to avail
the schedule to your committee by tomorrow (Tuesday).”

It could not be ascertained yesterday if Gono had honoured his commitment.
The committee insisted that the request was not a witch-hunt but just the
promotion of good corporate governance whereby senior central bank officials
in line with the law had to declare their interests.

The list of declarations would not be limited to RMB, but other financial
institutions and also companies in which Gono and RBZ officials had
interests.
The committee further quizzed Gono and his board on progress in the disposal
of the bank’s non-core assets acquired at the height of its quasi-fiscal
operations between 2003 and 2009.

The central bank had interests in residential properties, commercial
properties, and in companies such as Tractive Power Holdings, Cairns,
Homelink and Tuli Coal, among others.

RBZ vice chairman Charles Kuwaza said the disposal was based on the bank’s
new thrust to concentrate on its core function as a monetary authority.
“We are disposing because we are thinning out to remain with our
core-business, that is central banking and managing the monetary side of the
economy,” Kuwaza said.

Board member responsible for disposal of the assets, Justice George Smith,
said the bank was expecting to raise US$135 million at the end of the
process.

However, Zhanda queried why some commercial properties like Hardwicke House
and Bank Chambers were not listed for disposal even if they were acquired
during the quasi-fiscal era like other properties.

Gono said these were prime and strategic businesses next to the RBZ and “we
are to rethink on these in the interest of the state”.
However, Zhanda insisted that the properties should also be disposed of.
The RBZ is presently saddled with a US$1,2 billion debt vastly curtailing
its ability to efficiently functioning as the lender of last resort to
banks.

Impunity rules during Zimbabwe’s ‘transition’

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

Thursday, 06 October 2011 16:58

LAST  month Zimbabwe  President Robert Mugabe was telling MPs in
arliament  — to loud cheers from both sides of the house —  that there would
be “zero tolerance” of political violence, while outside the building,
supporters of Prime Minister Morgan Tsvangirai’s Movement for Democratic
Change (MDC) were being severely beaten by Mugabe supporters, as police
stood by.

About 11 MDC supporters needed hospitalisation, including MDC councillor
Victor Zifodya who sustained head injuries.
“The police know that Zanu PF supporters are behind this but they appear to
be afraid to arrest them,” MDC youth spokesperson Maxwell Katsande told
Irin.

Tadiwa Choto, a victim of political violence during the 2008 elections, told
Irin if Zanu PF can engage in violence while Mugabe addresses parliament, it
illustrates “either they don’t listen to him (Mugabe) any more or that he is
aware of these acts of violence while saying the right things in order to
please Sadc.”

The disconnect between political realities on the ground and public
statements was also evident during the Sadc  security troika meeting in
Zambia some six months ago which called for “the immediate end of violence,
intimidation, hate speech, harassment and any other form of action that
contradicts the letter and spirit” of the unity government —  but the
violence continues.

Brian Raftopoulos, a senior researcher at the Centre for Humanities Research
at the University of the Western Cape, told Irin political violence was the
domain of Mugabe’s Zanu PF and sporadic acts of violence by the MDC paled
into insignificance by comparison.

“Violence has been a central electoral tool (of Zanu PF) since 2000 (when
the MDC emerged as a viable opposition to Zanu PF rule), as it has been for
most of the post-Independence period. Since 2000 it has intensified,” he
said.

But he said Sadc was “keeping a closer-eye” on political violence and it was
unlikely there would be a repeat of it in any forthcoming election,
potentially as early as next year.

Violence peaked during the disputed 2008 election in which Zanu PF lost its
majority in parliament for the first time since Independence, and Tsvangirai
narrowly missed securing the presidential vote in the first round, amid
widespread claims of vote-rigging. Tsvangirai subsequently withdrew from the
second round in protest against political violence.

The MDC says about 200 people were killed, thousands injured and tens of
thousands displaced during the 2008 electoral violence.
The Zimbabwe Peace Project (ZPP) said in a recent statement it was “appalled
by the ongoing use of violence and brutal attacks on members of the public”
and the failure of police “to respond in timely fashion and arrest all those
responsible”.

The ZPP said in July 2011 it recorded 910 incidents of violence and human
rights abuses.
Raftopoulos said Zanu PF does have levels of support, but when “confronted
with losing power”, as in 2008, political violence becomes “a central part
of Zanu PF’s capacity to rule”.

Zanu PF had also become “fractious”, he said — illustrated by its desire to
hold early elections, as the party had no “national figure” to replace
Mugabe amid mounting reports of the 87-year-old’s deteriorating health.

Mugabe’s recent announcement that elections should be held by March 2012 at
the latest — although analysts say the holding of a poll could no longer be
set unilaterally by Mugabe and required consensus both from the MDC and
Sadc — led to violence across Harare, while some members of the army went on
the rampage assaulting civilians at random.

The National Constitutional Assembly (NCA), an NGO campaigning for a
democratic constitution, said in a recent statement: “We note that the
escalation of violence is as a result of President Mugabe‘s pronouncements
that elections will be held next year in March and it seems the political
parties are now in campaign mood.

“The violence signals instability in our country and must be quelled before
it fuels to the levels we saw before the 2008 elections… We are, however,
worried about the partisanship of our police force who are only shifting the
blame to the MDC while leaving those from Zanu PF,” NCA said.
Violence is also not limited to the streets: MDC MPs and a priest were also
assaulted inside parliament in June: Their attackers demanded that a
parliamentary debate on the Zimbabwe Human Rights Commission Bill be
deferred.

Didymus Mutasa, the presidential affairs minister, said his party stood by
those who attacked MDC parliamentarians inside the house, telling the media:
“Is it possible for someone to just leave their homes to go and beat up
people at parliament without being provoked?”
Sadc’s ability, beyond occasional rhetoric, to curb or end political
violence in Zimbabwe is limited both by its capacity constraints, and the
few enforcement mechanisms it had available, Judy Smith-Höhn, a senior
researcher at the African Conflict Prevention Programme at the
Pretoria-based think-tank, the Institute for Security Studies, told Irin.

Zimbabwe could be expelled from Sadc, but this was unlikely as it was a
founding member of the regional body; and Sadc sanctions were unlikely since
the organisation had been campaigning for their removal since 2002,
Smith-Höhn said.

The nearly decade-old targeted sanctions imposed by the US and the European
Union banning travel and freezing the bank accounts of individuals and
companies linked to Mugabe and his Zanu PF party have become politically
expedient for Zanu PF: Mugabe routinely blames economic woes and food
insecurity on the sanctions, and Sadc has also pitched in on Mugabe’s side.

Raftopoulos said there needed to be a “calibrated approach” to sanctions by
the US and EU, who should look to reward progress with the suspension of
some sanctions. — Irin.

Post-succession potholes

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

Thursday, 06 October 2011 16:05

WELCOME to the seventh instalment of our monthly series called Bible School
Business School (BSBS). BSBS takes insights from the Bible and applies them
to business, leadership and personal development issues.

Succession cuts across key contemporary business dimensions such as
corporate governance, enterprise risk management, talent management and
finance, for instance. The thread that runs through these business
dimensions is business continuity, long-term sustainability and
organisational survival.

The Bible is a theatre of succession dynamics, providing a treasure trove of
insights into the potholes and high points of succession processes. From the
actions and reactions of Moses and Joshua in their four decades of
interactions leaps lessons that are relevant to Zimbabwe’s contemporary
corporate space.

The Joshua syndrome

Joshua was the annointed successor to Moses. However, Joshua showed some
cracks in character that would undermine his effectiveness as a future
leader. It would appear that some of the weaknesses he showed pre-succession
persisted post-succession.

Corporates can glean practical lessons from the mistakes of Joshua so as to
minimise the risk of a post-succession failure. Post-succession failure can
result in corporate failure.

Scarcity mentality and impatience

To effectively govern the fledgling nation, Moses appointed 70 governors.
The story, as told in Numbers 11:23-29, gives us a glimpse into young Joshua’s
terrible leadership weaknesses.

Earlier, Joshua had been given the privilege of accompanying Moses to Mount
Horeb, where Moses would be given the moral code or what we would today term
corporate governance code (constitution) to help govern the newly- found
nation. Numbers 11:28 makes it explicit that Joshua was the servant or
apprentice of Moses.

Perhaps Joshua wanted to be among the 70 elders (governors). Sixty-eight of
the governors were confirmed with a sign before Moses.

Suddenly, a young man rushed towards Moses and broke the news that two men,
not present, Eldad and Medad had shown the same confirmatory signs. Joshua
did not take kindly to that. As recorded in verse 28, Joshua remonstrated
with Moses, saying, “My Lord Moses forbid them.” Two cracks in Joshua’s
character are apparent.

He had the scarcity or MBA ‘Me Before Anyone’ mentality. He was impatient.
Perhaps he thought that not being named among the 70 would harm his chances
of becoming Moses’s successor. Fortunately, Moses sharply rebuked his
apprentice for exhibiting a scarcity and quickly-rise mentality. Joshua
still had a long way to go. He was not ready for succession.

He suffered from insecurity. If not tamed, this insecurity would blossom
into paranoia post-succession. Evidently, Joshua was quarter-baked. He
needed more time to wait and wait upon (serve) so as to remove his rough
edges.

Leadership writers such as John Maxwell contend that one of the grandsons of
the legendary Henry Ford who succeeded at Ford Motor Company suffered from
the Joshua syndrome. Ford’s grandson would sow discord among his top
executives through duplicity.

He surmised that if he weakened his top talent, he would be able to control
them. Ford Motor Company lost strategic focus and the creativity of its
founder, Henry Ford. The company bled its market share and teetered on the
brink of bankruptcy.

Picking a successor with a scarcity mentality is underwriting the death of
an organisation. People are not going to buy cars just because your
grandfather was a national icon.

Poor judgement and myopia

Joshua could be forgiven for showing poor judgement in his early
apprenticeship days. When Moses and Joshua were coming down Mount Horeb with
the moral code, our equivalent of the corporate governance code, their ears
caught strange noises echoing from the valley beneath. Moses wondered what
the bizarre noise that pierced the desert air was about. Joshua offered a
thesis.

He surmised that it was the noise of war. Moses disagreed. It turned out
Moses was right after all. The outlandish noise came from hard partying. War
and partying—surely Joshua was way off the mark. That’s terrible judgment.
Apparently, Joshua’s gifting was in the art of war.

He was a sword and shield man through and through.  He tended to see issues
with the lens of his natural talent. The result was leadership myopia.

In the post-succession period, when Joshua finally got to the helm, he
showed terrible judgment. As argued by John Maxwell, a person’s weaknesses
are magnified when they assume leadership positions. In like manner, it
might be construed that pre-succession deficiencies are accentuated
post-succession.

Whereas pre-succession the consequences were confined to a few people,
post-succession, the fallout affects masses. This is what happened at the
get-go of Joshua’s reign.

Having led his armies to a famous victory at Jericho, Joshua let the guard
down and took an ill-prepared army to Ai, a much smaller city, assuming that
Ai would be a walkover. Joshua got a rude awakening. His armies were
clinically routed, much to his shock.

Four thousand years later, corporates are not immune to Joshua’s twin cracks
of terrible judgment and functional myopia. Talented employees from the
production side of business are promoted into general management on the
basis of functional competence, forgetting that at senior executive levels,
broader leadership skills are needed.

Human Resources (HR) thinkers  have recently come up with a solution to the
challenge. They have come up with what are known as dual career paths. For
instance, an engineer can opt to remain in engineering and rise through this
job family without losing their seniority and rewards.

I shared the idea of dual career paths with a friend of mine who works in
the media.  They alerted me to the phenomenon that in some developed
countries there are news anchors or frontline reporters with more than 20
years’ experience, who have chosen to remain in these ‘junior’ jobs.
However, they are paid senior executive salaries.

Dual career paths can go a long way in minimising the risk of
post-succession regret. World class organisations never get poor people
managers into the top echelons of the company. World beaters insist on
senior executives with mastery at the nexus of business and people.

Successor without a successor

Joshua had had the rare privilege of being led by an exceptional leader in
the name of Moses who possessed uncommon maturity and security. Within 50
days of Moses’s becoming the visible leader of the newly-born nation, he
took Joshua under his wings as his apprentice.

Moses’s first 100 days plan involved identifying his potential successor.
From day one, Moses was gripped with the thought of finding his replacement.
That kind of leadership is a rarity.

Moses knew that the foundation of leadership is integrity. So he took Joshua
with him to Mount Horeb, where Moses would receive the moral code/leadership
code together with his potential successor. From the outset, the successor
had to be saved from the tragedy of a false start.

Today, the corporate world has woken up to the need for corporate governance
codes. Ancients of the near East, as depicted in the Bible, understood the
importance of living by a corporate governance-cum-leadership code. In the
twilight of his leadership, Moses expanded the corporate governance code,
capturing wide-ranging issues. He gave the document to the leaders of the
nation and charged Joshua to live by the code.

However, Joshua failed to groom a potential successor. The post-Joshua era
makes sad reading. The culture of poor succession persisted generation to
generation after Joshua’s departure.

Walt Disney, the people who gave the world Mickey and Minnie Mouse, escaped
corporate death by a whisker due to poor succession planning. It took the
strategic brilliance of one Michael Eisner to stop Disney’s funeral hearse.

You do not want that near-death experience. Failure to handle pre-succession
and post-succession fundamentals results in corporate mediocrity and finally
death.



By Brett Chulu

More power outages loom

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

Thursday, 06 October 2011 16:34

Chris Muronzi

ZIMBABWE is headed for more power outages after several generation units at
the country’s most reliable power station, Kariba,  went off owing to
various faults, a Zimbabwe Power Company report to industry says.

According to the report, Kariba, which has largely been operating at full
capacity for the past two years, is struggling.

“During the week ending 25th September the protection on Units 3 and 4
tripped. Unit 4 was isolated from the transformer which it shares with Unit
3. Unit 3 was then brought back into service. After meticulous trouble
shooting, it was found that switchgear and control devices, which were
replaced by another OEM (Original Equipment Manufacturer) during our
maintenance shutdowns earlier this year, had failed. Repairs to these
devices are underway under guidance of the OEM from Europe,” said the
report.

The problems at Kariba Power Station started in June after a failure in the
generator winding of Unit 2.

Copper windings to get Unit 2 back on stream can only be manufactured and
fitted by OEM.

The problem was compounded by a crack that was found in one of the turbine
blades which only the OEM can repair.

“This repair work is underway and is scheduled for completion before
mid-October. In my view the OEM did not, and could not, be encouraged to
respond to our crisis with the urgency demanded by our unique situation or
with the respect that a 30year relationship deserves. Our MD has been in
Europe this week to discuss this with the OEM,” said the report.

ZPC foresees a “significant amount of work” going into stabilising Hwange
Power Station and hopes to float a tender once funding becomes available to
replace key components which have lead times of up to one year.

Hwange, according to the report, lost four Phase One smaller units over the
last week.

“ Unit 1 due to the failure of the “Boiler Feed Pump” which is new and under
warranty, Unit 2 due to a failure of its thrust bearing, Unit 3 due to wear
on its induction fans caused by the under-performing de-ashing system and
Unit 4 due to the failure of its Boiler Feed Pump,” said the report.
The problems at Hwange were worsened after the entire station was taken out
by a surge out of Eskom last Tuesday.
“At the time of writing this statement we now have two Phase Two (larger)
units and one Phase One (smaller) unit feeding the grid. We expect to bring
another unit back overnight (Sunday) and the fifth by Wednesday this week,”
the report said.

Thermal power stations in Bulawayo, Harare and Munyati are also constrained
in maintaining modest outputs due to the availability of coal from
suppliers.
“All three suppliers assure us that their production will improve over the
next two months. Should this not be the case we will have to consolidate and
probably run only two of the three stations,” added the report.

Major retrofitting and component replacement projects will continue over the
next 12 months, the report said.

Wapcos, the Indian company that provides expert advice at Hwange, have
provided an experienced project manager to help oversee these projects at
Hwange.

ZPC   hopes the execution of these projects would extend planned outages of
units on a sequential basis next year.

“For example the precipitators (ash handling) on Phase Two will be
retrofitted over the next seven months therefore from the middle of October
until May 2012 and one of the Phase two Units will be offline,” said report.

“At Kariba the system that governs the turbine blades, in sympathy to the
power demand, will be replaced on each unit (six weeks per unit) on a
sequential schedule. This means that from mid-December until September 2012
only five of the six units will be online.”

In addition, ZPC will over the next 12 months some units will also be taken
off line for shorter periods to undertake unit specific upgrades or repairs,
the report added.

“So in summary the power supply regime will for the next 12 months will be
much the same as it has been for the last 12 months – all in a bid to
stabilise and optimise supplies in the medium term,” the report added.

The refurbishment of the 40km pipeline from the Zambezi to the Hwange
station remains a priority and is a one year project. The feasibility study
was completed over two months ago and we await the outcome of possible of
government-to-government funding with the government of India.

While demand for electricity is picking, nothing can be done to augment
output for the next four years when planned power projects come on board.

Treasury still in a fix over Zimdollar exchange rate

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

Thursday, 06 October 2011 16:27

Paul Nyakazeya

TREASURY is still  struggling to determine the exchange rate to use in
settling Zimbabwean dollar account balances that were frozen when government
decided to dollarise the economy in February 2009,  according to Finance
minister Tendai Biti.

He said Treasury was facing a dilemma in trying to come up with a formula to
use in determining payment since there were four exchange rates in use
during the Zimbabwe dollar era –– the official exchange rate, the cash rate,
the real time gross settlement rate (RTGS) and the parallel market rate.

The official rate was too low and if adopted would result in too many people
becoming millionaires in US dollar terms. On the other hand, parallel market
rates were high and attractive but were outside formal rates and government
would be breaking its own laws if it recognised these.

However, should government eventually decide on a rate, what are the legal
implications if it is not accepted? On the other hand, will there be
litigation should government continue using the present multi-currency
system? Would companies and individuals whose huge savings were eroded after
the economy was dollarised sue the state?

How long will Zimbabweans with quintillions trapped in bank accounts have to
wait before they can be paid their US dollar equivalents as government
grapples with which exchange rate should be used for payouts?

Economic analyst Eric Bloch said none of the exchange rates applying
immediately before the “demonetisation” of Zimbabwe’s currency can credibly
be used.

“The Reserve Bank officially-determined rates bore no credibility, due to
the extreme hyperinflationary environment, which effectively devalued the
currency almost hourly. Similarly, the parallel market and informal sector
currency markets had no stability or commonality of rates between traders
and between transactions of varying quantum,” said Bloch.

He said the conversion rate prescribed at the introduction of dollarisation
was wholly arbitrary and would be equally unrealistic to apply.
“Strictly speaking, there should be no governmental obligation to compensate
for Zimbabwe dollar balances, for the reality is that at the time of
dollarisation, the Zimbabwe dollar had lost all value. It was worthless,” he
said.

However, he said at the time the change was made, a commitment to do so was
made, “so government is, at least morally, bound to do so. Over and above
that it will be governmentally perceived as politically opportune”.

Using the official rate, government would have to monetise US$50 billion, an
impossible feat.
But would government break the law and use parallel exchange rates, for
instance the United Nations rate of 35 quadrillion to the US dollar used in
2008?
Biti maintains by doing so government would be breaking the law.

“Therefore, the nearest approach to determining a fair conversion rate would
be to apply the exchange rate prevailing in 2000 and adjust it by the
inflation sustained from 2001 to January 2009, thus effectively maintaining
value at the pre-hyperinflation era level,” said Bloch.

Given that government does not have resources to fund the beneficiaries,
whatever compensation can only be funded from borrowings (if available), but
this will concomitantly further escalate the already gargantuan national
debt, said Bloch.And whatever the compensation route pursued, appropriate
Monetary Policy Laws will have to be enacted.

In his Mid-Term Fiscal Policy Statement in July, Biti estimated that the
demonetisation exercise would cost about US$6 million.
“This amount will need to be provided for through the budget. A committee
comprising officials from government and the Bankers’ Association of
Zimbabwe is currently working on the requisite details and modalities to
operationalise the process,” he said.

Economist Brains Muchemwa said although the moral call to compensate
depositors when the currency was changed sounds fair, the fact remains that
treasury will settle for an exchange rate that will ensure small amounts are
credited to individual accounts, since the government is broke and cannot
afford to compensate for the economic loss.

“The whole thing will therefore be stage-managed to put a face that
government is having a genuine urge to compensate depositors. Indeed the
reported dilemma at treasury as regards which exchange rate to use is just
but a fake drama because in fact the truth is known already on the amount
that is available to compensate depositors,” he said.

Economic analyst Farayi Dyirakumunda said a suitable exchange rate for the
conversion of the old Zimbabwe dollar balances into hard currency is the Old
Mutual Implied Rate (“OMIR”).

“This is an objective proxy for the value of the Zimbabwe dollar to the US
dollar, based on the relative values of shares on the London and Zimbabwe
stock exchanges. It was a commonly accepted measure of what the real
exchange rate was given that we had a fixed official rate in a
hyperinflationary economy,” he said.

He said as things stand, the minister was grappling with other immediate
budgetary priorities. “The matter should realistically be put on the back
burner until a point where adequate financial resources can be allocated for
the exercise,” Dyirakumunda said.

Muckraker: You don’t have to be racist to be a patriot

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

Thursday, 06 October 2011 17:16

HOW many readers have heard of the “Cuban Five”? It would be surprising if
you haven’t because the state media in Zimbabwe has given them an inordinate
amount of publicity.

The five were arrested in Miami in 1998 and charged with espionage. The five
claim they were helpful to the US authorities. Whatever the case, they
remain incarcerated in Miami.

According to the Cuban government: “In September 1998 five Cubans were
arrested in Miami by FBI agents. Their mission in the US was to monitor
activities of groups and organisations responsible for terrorist activities
against Cuba.”

The Herald, which carried a sympathetic account of their ordeal last month,
reminds us of Cuba’s contribution to Zimbabwe’s “revolutionary principles”
and the assistance rendered at the time of Independence in the field of
education and medicine.

We will not controvert any of this. Cuba has been generous in its assistance
to Southern Africa over the years since the 1960s. But what strikes us as
extraordinary is the way states like Zimbabwe, Namibia, Angola and
Mozambique have done nothing to express solidarity with journalists, writers
and civic activists who have been incarcerated in Cuba and left to rot.

There was a brief episode when a handful of writers were released following
Pope John Paul’s visit to the island, but the beneficiaries were obliged to
seek exile in Spain.

Meanwhile, the Cuban Five’s supporters here complain bitterly that if the
five are released they will have to remain in Miami.
The other dimension to this is that supporters of the Cuban Five have never
bothered to tell us what they think of activists held in Zimbabwe’s jails.
What about the MDC officials who were accused of involvement in killing Cain
Nkala, who was suspected of kidnapping David Coltart’s election agent,
Patrick Nabanyama.

President Mugabe went to Bulawayo and branded them terrorists. They were
subsequently locked up for 21 months after Justice George Chiweshe reversed
an order by Justice Lawrence Kamocha who had ruled that the accused could
not be indicted for trial. They were, after a marathon trial, acquitted by
Justice Sandra Mungwira in August 2004. Fletcher Dulini-Ncube lost the sight
of an eye during his detention.
Surely the supporters of the Cuban Five have something to say about this
lest the world thinks them hypocrites.

It was amusing to witness the turn of events in Zambia last week. Zanu PF
was celebrating what they considered a great victory. This was a kick in the
teeth for imperialism. Acres of forests were being chopped down to produce
the pulp necessary to send the word that Michael Sata was a friend of Mugabe
and an enemy of the MDC. Columnists like Reason Wafawarova were ecstatic.

“Closer home, Michael Sata of Zambia just won an election against the West’s
favourite MMD and the win is an emphatic message that indeed imperialism is
not invincible,” he crowed.

Life isn’t that simple. One of Sata’s first moves was to tell the Chinese
they could do business in Zambia on the same terms as everybody else. They
would not receive any favoured treatment from his government, he made clear.
And let’s hope the appointment of veteran nationalist Guy Scott as VP sends
a clear message to Zimbabwe’s delinquent nationalists that you don’t have to
be a racist to be a good patriot!

Meanwhile, we were interested to note that cabinet had given a directive
that Finance minister Tendai Biti release $40 million to buy inputs and
recapitalise the GMB to pay farmers for grain delivered. Cabinet made the
directive at its weekly meeting, we were told, on September 29.

This is all very interesting. Don’t we recall Webster Shamu warning
newspapers not so long ago it was a grave sin for them to disclose matters
arising from cabinet meetings? Perhaps we misheard him. And we thought we
heard George say something similar!

By the way, what is the status of some well-known outstanding issues? In
addition to Charamba, there is the matter of Gideon Gono, Johannes Tomana,
and Roy Bennett.

Have they all slipped off the radar? And how could that happen without any
of us being told?

On this topic, how does New Africa editor Baffour Ankomah find his way to
Zimbabwe as soon as he gets wind of an election?
Baffour is a dedicated disciple of the Mugabe regime. They can be sure of
indulgent coverage when he returns to his home in London. Like other
columnists, Baffour evidently prefers the comfort of Britain to his
homeland, Ghana.

In the interests of transparency could Baffour tell us who sponsors his
regular visits to Zimbabwe. We are sure it’s not a secret.
Here’s a clue: “I live in London but I yield to Nathaniel Manheru for the
great depth in which he treated the subject (of the August UK riots) in the
Saturday Herald. If you missed Manheru’s column please get the Saturday
Herald (August 13). It deserves to be framed and put on the living room
wall.”
So there you have it! But sadly there will be few takers. The column is
hardly a “must-read”! And we always have a chuckle when it goes missing
whenever the president is in New York.

We were interested in an article in the Herald on the collapse of irrigation
systems in Manicaland. Just as the president was telling an audience in New
York that agriculture had recovered, a report in the Herald said villagers
in the province were facing acute food shortages as dams lie idle. Thousands
of households were facing critical food shortages as irrigation schemes had
been vandalised.

“There is the 30ha Murambinda scheme that is not operating to capacity while
the situation is even worse at Bonda where there is no pump and farmers are
doing nothing,” the acting DA said.

“In Honde Valley there are projects that were left at the piping stage by
the EU when it pulled out at the height of the land reform programme,” we
are told.
All very sad. But who’s the one?

Elsewhere, Mashonaland Central governor Martin Dinha has “rapped” the MDC
for denigrating senior Defence Forces officers who sacrificed to liberate
Zimbabwe.

“It is disheartening that the traitors are now spitting in the faces of
those that liberated them,” Dinha said. “We should not allow them to do
that.

“They now have the temerity and audacity to call for security sector reform
and pour scorn on the service chiefs and talk about human rights.”
He was speaking at the reburial of former freedom fighters in Chibondo.
Who is pouring scorn on the service chiefs? Certainly not the MDC. Don’t we
recall a cable recently quoting senior officers pouring scorn on one
particular colleague?

Dinha should tread carefully where there are political landmines lying
around. And why does he think that constitutional change including the
security sector amounts to “spitting” in people’s faces?

Dinha wants to know where human rights groups were when our people were
being massacred. We should ask him where he was when 20 000 people were
killed in Matabeleland. Dinha said the Europeans and British had no moral
standing to teach Zimbabwe about human rights and democracy. Zimbabwe owes
its freedom to those lying in Chibondo he said.

Indeed it does. And it is shocking that demagogues should hijack such
ceremonies to seek votes. The next time Dinha mentions Chibondo we should
all be sure to mention Bhalagwe, Antelope Mine, and Sun Yat Sen –– as loudly
as possible.

‘A bruising legal fight is looming between Zimbabwe and the European Union
(EU),” the Sunday Mail reports, over the latter’s imposition of “illegal”
sanctions. This is amid revelations that the Attorney-General’s Office has
assembled a team of the country’s best legal minds to file papers against
the bloc.

Attorney-General Johannes Tomana confirmed that his office was drafting
court documents that will be used in the “unprecedented” fight against the
sanctions.

Tomana saidpapers were being prepared for the resumption of the “historic”
legal battles in the General Court of the European Court of Justice for the
annulment of the embargo.

Tomana and his colleagues doggedly ignore the EU’s clear call for parties to
finalise the election roadmap. Zanu PF has continued to throw spanners into
the GNU roadmap works with President Mugabe now intent on elections even
without consummating the Global Political Agreement in full.
Zanu PF want the sanctions to go without addressing the issues that brought
them in the first place. They should be reminded that they cannot have their
cake and eat it too.

And is it seriously suggested that the country’s “best legal minds” are at
the service of Zanu PF? Hardly likely!

Meanwhile the Zimbabwe Youth Council (ZYC) and other representatives of
youth organisations have expressed concern over Finance minister Tendai Biti’s
attitude towards addressing challenges they are facing.

ZBC reports that the youths, who had booked a meeting with the minister,
expressed disappointment after he allegedly snubbed them, resulting in the
meeting failing to materialise.

The youths say they are now losing patience with Biti, who is allegedly
“refusing to release funds to spearhead youth development projects”.
This indigenisation craze has created a leech culture whose full extent is
yet to be felt. These “youth” organisations are now demanding an arm and a
leg from corporates for “development projects”. This is political blackmail.

Old Mutual was compelled to grant a 2,5% stake valued at US$10 million to
the Youth Development Fund. An additional US$1 million will be made
available from the Old Mutual Fund.

The fund, to be disbursed through CABS, will be jointly administered by the
Indigenisation ministry and Old Mutual.
“Every province will benefit from the US$11 million fund,” the Herald
claims.

This is said in the context of utterances by  Indigenisation minister
Saviour Kasukuwere to the effect that the indigenisation programme will
benefit mostly Zanu PF supporters because other political parties are
against it.

“They have said they are not interested in taking companies from their white
owners, so they won’t benefit from the indigenisation drive. So our people,
our Zanu PF supporters will benefit and become empowered through this
programme,” Kasukuwere said.
In the circumstances it would be a grave dereliction of duty for any Finance
minister to give public funds to dubious outfits of this sort sponsored by
senior party hacks.

Don’t we recall some months ago a Reserve Bank report on all the benefits
new farmers and others received saying there was no prospect of recovering
these “loans”? And what does Old Mutual think it is doing collaborating with
the Indigenisation ministry in handing out investors’ funds?

Those who have warned that we have new colonisers on the continent in the
form of the Chinese will have been borne out by the pressure brought to bear
by Beijing on the South African government not to grant the Dalai Lama a
visa to attend Archbishop Desmond Tutu’s 80th birthday party.

Pretoria has ducked and dived over the matter of the visa. China is now one
of South Africa’s biggest trading partners and has made it clear it will be
displeased if the visa is granted. The Dalai Lama has had to withdraw his
application because he will now miss the event.

It would be different if Tutu was Julius Malema or some other rabble-rouser.
But he is a decent and thoughtful elder statesman who has made an enormous
contribution to his country. China’s behaviour is that of a bully while the
best that can be said of South Africa is that it has demonstrated cowardice
where courage is required.

China was unlikely to have withdrawn its investments in the event that the
visa was granted.  And it would have provided a good example to Africa if it
stood up to the new colonial power as Sata is doing.

Please explain, Minister Kasukuwere

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

Thursday, 06 October 2011 16:46

Eric Bloch

REPETITION can be unduly odious, but on occasion becomes necessary because
of the intentional obtuseness of those at whom the repetition is directed.
Repetition is of necessity if done in a determined attempt to penetrate the
blockage of those intentionally deaf (there are none so deaf as those who
will not hear!).

The need for many to be repetitive (including  this columnist), has been
especially pronounced over the last few years because of the determination
of the Minister of Youth Development, Indigenisation and Economic
Empowerment, Saviour Kasukuwere, not to heed the views and representations
of any, other than some of his political hierarchy colleagues who suffer
from identical opinion rigidities.

The many times that several in the private sector have reiterated that the
minister needs to recognise realities and modify the policies he so
vigorously pursues are countless, but almost without exception, have been
cavalierly disregarded, usually with unconcealed contempt.

This is notwithstanding that the submissions have emanated from almost all
walks of society, including representative bodies such as the Chamber of
Mines of Zimbabwe, the Confederation of Zimbabwe Industries, the Institute
of Bankers, the Institute of Directors Zimbabwe, the Zimbabwe National
Chamber of Commerce and many others, including countless individuals not
directly impacted upon by the minister’s policies and actions.

Because it is not credibly contestable that Zimbabwe does not need to pursue
indigenisation and economic empowerment, and to do so dynamically and
constructively, the intense representations to the minister and his
associates have in no manner sought to discourage such pursuit, but in fact
to encourage it.  However, critics have authoritatively asserted that the
manner whereby the minister is seeking and determined to achieve it, is
destructive in the extreme.

Far from achieving the intended objective, the way in which Zimbabwe is
pursuing its desired indigenisation of the economy and the empowerment of
the populace is decimating the already exceptionally fragile economic
operations and endeavours, and progressively reducing Zimbabwe to one of the
world’s most impoverished countries.  It is rapidly transforming the country
into an internationally perceived pariah state which has contemptuous
disregard for realities.

Despite the substantive inputs given to the minister as to the negative
consequences of his rabid approach to the issues, supported by comprehensive
proposals as to how the desired objectives can be successfully attained, in
the last few weeks the minister has, even more vociferously than previously,
ignored all, and obdurately adhered to his entrenched determinations.

Several times during the last fortnight he has voiced intensive, dire
threats to the perceived non-conformists to his policies, whilst
concurrently he has claimed that those policies will eradicate the poverty,
distress and suffering which afflict most Zimbabweans, and accord to them
their rightful ownership of the economy.

At the same time, he emphasises that all must comply with law (and in that
respect he is amazingly correct), but he fails to recognise that his
legislation and its underlying regulations contain at least 12 breaches of
Zimbabwe’s constitution and the laws of the country.

The pronounced ministerial statements merely assert what are alleged to be
“facts”, without in any manner whatsoever supporting them with any credible
corroborations.  As a result, one must necessarily ask the minister to
state:

    How his indigenisation policies will reverse Zimbabwean poverty, when
they are resulting in numerous, unavoidable, business closures and
down-sizings, with consequentially tens of thousands becoming unemployed,
unable to sustain themselves, their families and their dependants

    With declining productivity in innumerable enterprises, due mainly to
them being unable to access essential working capital resources as
financiers are fearful of indigenisation-driven non-redemption of provided
finance, it is inevitable that cost of goods to consumers will rise.
Minister, how will that inflation alleviate poverty?

    In which manner will the economic empowerment being pursued by him
“benefits the masses” when, in the main, shares are to be transferred
directly or indirectly to state-controlled designated entities, including a
yet-to-be established Sovereign Wealth Fund, when for more than 30 years
almost every state-controlled entity has been a dismal failure, unable to
service national needs and doing naught but to exacerbate and intensify
national debt?

    How investors will continue to control the enterprises they have
established, notwithstanding their being forcibly obliged to hold no more
than 49% of the shares in the business?  He has tried to support this
spurious contention by saying that the holder of 49% shares will be the
largest single shareholder in that enterprise and therefore have control
retention.  But has the minister never been told that if the holders of 51%
of the shares vote collectively (which is especially probable when to a
major extent they are state-designated entities), they then wholly destroy
any control or authority from the 49% shareholder?

    In what way can his repeated undertakings that upon 51% disinvestment,
fair intrinsic value payment will be given for the disinvested equity, be
fulfilled?  The state is bankrupt, the designated state entities are devoid
of funds, the Reserve Bank can no longer be forced to print bank notes, so
whence will come the funding to pay fair value?  Moreover, insofar as the
mining sector is concerned, the minister states that the investment fair
value will be determined after deducting, from aggregate value of the
mineral resources applicable to the mines, which are national resources.  He
contends this despite the fact that the mines have paid, and are, paying for
those resources, through the myriad of claim registration and licence fees,
royalties, direct and indirect taxes, and therefore he is effectively
seeking double-value recognition for the resources in order to diminish
amounts actually payable to the ousted investors?

    The way market confidence is to be restored in the financial sector in
general, and the banks in particular, when his measures deter non-resident
shareholders and other international financiers from providing the
institutions with desperately-needed capital, loans, and lines of credit?
The populace has been badly burnt by the instability of the banks in the
last few years, triggered by hyperinflation, demonetisation, bank collapses
and other factors.  Few were willing to entrust their very limited resources
to the banks and that further weakened the financial sector, and hence the
economy.  Slowly, confidence was being restored, but now the minister is
destroying that confidence recovery.  Why, Mr. Minister?

    How is it equitable that he can contentiously and threateningly demand
that the so-called “non-indigenous” and “foreign” investors comply with the
specious, invalid law, when he vigorously and endlessly disregards the
constitution and enacts regulations to an extent as exceeds his authority?
(Surely that which is sauce for the goose should be source for the gander?).

It is long overdue that the minister emulate the fabled Dick Whittington
(even though he was British!), by looking again.  Yes, Zimbabwe must
energetically pursue and achieve substantial indigenisation, and wideranging
economic empowerment, but needs to do so in a manner that can work, and
which is just and fair, and not a deterrent to investment.  Can Zimbabwe not
learn from the successes of India, Malaysia, and others?

BEE policy needs proper interrogation

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

Thursday, 06 October 2011 16:37

Paidamoyo Muzulu

INDIGENISATION has become, over the past few years, the most used and abused
term in Zimbabwe’s political landscape. The dictionary describes
indigenisation as “increasing local participation in or ownership of” or “to
adapt to local ways”.

Not a day goes by without this word being used by some government ministers,
but in all their usage of this buzzword, none of them have been able to
clearly define the government’s exact indigenisation policy.

The policy initially demanded that foreign companies “cede” 51% of their
equity to locals until a question was raised that it was unconstitutional.
It created the impression that the government wanted to expropriate
companies just as it had previously done with the land issue.

The term “cede” has since been changed to “sell”, but the question is how
many locals in an economy in the throes of a liquidity crunch can afford to
buy such equity.

Widespread confusion reigns over the policy since government officials
continually pronounce uncoordinated and often contradictory policy positions
depending on the occasion or audience.

Indigenisation and Empowerment minister Saviour Kasukuwere, whose department
is meant to be the custodian of the policy, seems to be operating like an
unguided missile in the coalition government by going beyond the parameters
of the Indigenisation Act and acting like a “super minister” with powers to
encroach on other ministries.

Economic indigenisation by its nature needs the buy-in and shared position
of other government ministries to succeed. Each minister controls and
oversees a segment of the national economy.

No individual minister has overriding power over another minister’s mandate.
Veritas, a local lawyers’ grouping which focuses on parliamentary business
and legislation, issued a statement in September warning that Kasukuwere’s
threats to withdraw business operating licences was legally unsound.

“This is a legally unsound claim because the Indigenisation and Economic
Empowerment Act does not provide for the cancellation of business licences
for failure to submit plans,” Veritas’ statement read.

“Cancellation of business licences can be resorted to only when, without
official approval, a business is merged or restructured, unbundled or
demerged, or a controlling interest is acquired or disposed of, or an
investment made in it, and the result falls short of the statutory
indigenisation requirements [Indigenisation and Economic Empowerment Act,
Section 5],” Veritas said.

Kasukuwere’s threats were aimed at foreign-owned mines and financial
institutions. He went on to announce that Caledonia’s mining licence had
been “revoked” because the company had failed to submit an acceptable
indigenisation proposal to his ministry.

However, this cancellation was swiftly reversed after other government
ministers reminded Kasukuwere that he could not encroach on their mandated
economic sectors.

Mines minister Obert Mpofu refused to cancel Caledonia’s licence forcing
Kasukuwere to go back to the negotiating table. On the other hand, Reserve
Bank of Zimbabwe governor Gideon Gono waded into the debate by saying the
central bank was not going to cancel any banking licences for failing to
present acceptable proposals to Kasukuwere.

This threw Kasukuwere’s plan into disarray prompting him to keep shifting
deadlines for the submission of proposals to his ministry. In March this
year Kasukuwere gave a 45-day deadline for all foreign-owned companies to
comply.

He shifted that deadline to the end of September 2011 after facing severe
criticism. When the end of September came and went, Kasukuwere announced
that some companies had been given an extra two weeks to comply.

However, speculation is high that some clandestine deals are being sealed
since some companies are all of a sudden said to be compliant, even without
selling the 51% stake to locals.

Prime Minister Morgan Tsvangirai has spoken against the implementation of
the indigenisation policy at local and international forums saying equity
ownership was a panacea to the poverty of the majority.

He argues that indigenisation should not be a fixation with share ownership
but also embrace the issue of procurement. Equity ownership favoured the
rich few who are able to secure loans from lending institutions to acquire
shares.

In South Africa, the Black Economic Empowerment policy has created a few
black fat cats. This affirmative action policy produced millionaires such as
mining magnate Patrice Motsepe, business tycoon Cyril Ramaphosa, ANC
treasurer-general Matthews Phosa and Tokyo Sexwale.

The South African government only changed direction after realising that the
“usual suspects” were the same people benefiting under BEE. The government
then tweaked the policy to “Broad-Based Black Economic Empowerment”, which
focused more on marginalised communities. These communities could
participate through various community consortiums.

Still, the new policy faced more hurdles because wealthy blacks and those
politically well-connected used ignorant communities and individuals as
fronts to secure lucrative government tenders.

That is when the government decided to refine empowerment and focus more on
procurement. Big companies and government departments were compelled by law
to procure goods and services from small black-owned companies or those that
met set BBEE criteria.

Gono and Tsvangirai are of the opinion that the procurement policy is a
better option than the Kasukuwere-led equity control. The central bank chief
and premier argue that procurement spreads wealth widely and is most likely
to stimulate the growth of indigenous-owned small and medium enterprises.

“What does it benefit the locals to own 51% of a loss making big company,”
Tsvangirai asked during a visit to the US last week. Gono says the
government should learn from mistakes committed during the land reform
programme which was hijacked by a few politicians and their cronies and
dismally failed to increase agricultural production.

Analysts and political players for once agree that the indigenisation policy
should be reviewed and properly interrogated in relation to the results the
government aims to achieve.

They argue that expropriation of mines and financial institutions would lead
to capital flight and take the country back to the pre-coalition government
era of economic decline and political quagmire.

The market continues to see if the government will make the objective
decision to stop Kasukuwere’s one-man indigenisation crusade before it
wrecks the economy.

For once, politicians and business from different political persuasions
agree that indigenisation as currently proposed would bring more harm to the
economy than good.

More uncertainty haunts Zimbabwe

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

Thursday, 06 October 2011 16:31

By Anne Fruehauf

DESPITE a historic 2008 power-sharing agreement, Zimbabwe is not out of the
political woods. President Robert Mugabe’s failing health is fuelling both
an unseemly scramble among Zimbabwe’s elites for a share of the country’s
wealth, and also disputes over the succession.

While an all-out asset grab  is unlikely (in part because of elite
squabbling), Zimbabwe is set to  experience another round of volatility and
uncertainty that will last at  least until after the next elections, which
are not likely to occur until  2013.

Mugabe’s Zanu PF party is trapped in an awkward unity government with its
bitter rival, the Movement for Democratic Change (MDC) headed by Prime
Minister Morgan Tsvangirai.

Both parties are manoeuvring ahead of upcoming elections, but even the date
is disputed. Mugabe is pushing for polls in 2012, while the MDC and the
Southern African Development Community are pressing for 2013 in order to
allow time for overdue political reforms.

The MDC should be able to win minimally free and fair elections, but another
coalition government (involving all or part of Zanu PF) seems a more
plausible outcome at present.

Mugabe, now 87, has long been rumoured to be suffering from prostate cancer,
raising doubts about his ability to carry on in office. Succession concerns
and the party’s uncertain future are reinforcing efforts to push through a
controversial indigenisation law of 2007.

The law requires foreign businesses to cede 51% of their equity to
indigenous Zimbabweans  within five years. In part, the goal is to secure
large amounts of cash for Zanu PF ahead of the upcoming elections, but
elites are also taking advantage of the programme to siphon off money for
private and party gain.

Zanu PF has haphazardly implemented the legislation and the law is weak,
riddled with loopholes, and probably unconstitutional, according to legal
experts. It foresees no specific timeframe for indigenisation, but
regulations issued in 2010 and 2011 give effect to the law, implying a
cut-off point of 2015.

The MDC does not support the scheme, which it views  as a self-enrichment
scheme for Zanu PF bigwigs, which could cost it an election and the country
much-needed investment.

But it is unable to exert moderating pressure on Zanu PF on this issue
despite its control of the Finance ministry and improvements to
macroeconomic policy. This means the law’s revocation or overhaul is
inconceivable, at least until the next elections and probably beyond.

Disagreements within Zanu PF will make for a chaotic process, however.
Indigenisation and Empowerment minister Saviour Kasukuwere is already
running into opposition from Minister of Mines Obert Mpofu, whose department
controls licensing. Although Mpofu is a Mugabe ally and supports
indigenisation, he has rejected attempts by Kasukuwere to dictate policy.

This rivalry among Zanu PF players renders government relations increasingly
unpredictable. Uncertainty over indigenisation will  likely stall investment
and give an advantage to emerging market investors  unencumbered by targeted
Western sanctions, which include state miner  ZMDC.

Threats to revoke licences or demands for irregular payments are likely as
political players try to manoeuvre themselves or their front men into
shareholder positions.

Impala Platinum, which produces around 25% of global platinum output from
mines in South Africa and Zimbabwe, for example, received a letter from
Kasukuwere on September 6 threatening to revoke its mining licence unless it
submitted acceptable indigenisation proposals.

In the meantime, elites within Zanu PF are jockeying for position given
Mugabe’s illness. Vice President Joice Mujuru will be Mugabe’s likely
interim successor, if he becomes incapacitated while in office, but Zanu PF
factionalism raises the spectre of a contested political transition.

The constitution, which is yet to be reformed, stipulates that fresh
elections be held within 90 days of the president’s incapacitation. But the
2008 power-sharing agreement requires vacancies to be filled by the same
party.

This means Mujuru is next in line until fresh elections are held. However,
the mysterious death of her powerful husband General Solomon Mujuru in
August may embolden rival factions, such as that led by Defence  minister
Emmerson Mnangagwa, to challenge her succession bid.

Visionless leadership defers Zim’s dream

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

Thursday, 06 October 2011 16:14

By Tendai Biti

IN his latest book, Advocates for Change; How to Overcome Africa’s
Challenges, Moeletsi Mbeki states that leadership requires three capacities,
namely the ability to innovate, the capacity to implement by mobilising the
required resources and the capability to create followers.

The Zimbabwean government, before and after the formation of the inclusive
government has dramatically failed to lead and has in turn exposed the
bankruptcy of exhausted nationalism, the limitations of the Global Political
Agreement as a solution to the Zimbabwean crisis and indeed the premium
arising out of a culture of mediocrity, impunity, indifference and a lack of
creativity.

At the epicentre of Zimbabwe’s problems is not the existence of political
discord, violence, the absence of or the selective application of the rule
of law, a weak constitution or weak institutions.

Rather the absence, at first instance, of a unified common vision in respect
of which all citizens are genuine shareholders. A vision that recognises
that the nation’s vital interests are for the protection and enjoyment by
everyone and a recognition that within the implementation of that vision
there can be unity in differences and opposition.

Put simply we have lacked a higher-ground norm that unites us in a vision
that is beyond party politics, our religious, tribal or ethnic differences.

It is 31 years after Independence and the sad reality of our situation is
that we have found ourselves as a weak fragile state that is incapable of
fulfilling the demands and aspirations of its own citizens. Up until 2008,
our economy had been devalued by 65% of its 1996 GDP, 85% our people were
living below the poverty datum line while surviving on less that US two
cents a day.

Hyperinflation was calculated to be 5 000 000 000% by December 30 2008, and
life expectancy had sunk to below 40 years, 34 for men and 37 for women.
Two and a half years into the inclusive government, although there has been
some modicum of macroeconomic stability, the balance sheet is not rosy.

Political reform is zero; capital formation is virtually non-existent as
well as savings and foreign direct investment which is under US$300 million.
Instead, the political and the macro-political terrain is characterised by
violence, intolerance, hate speech and a virtual civil war in government.

Yet, as Zimbabwe wallows and withers in the clutches of attrition and
self-induced policy distortions, the rest of Africa has been making giant
strides. In the region alone, the average growth rate in the past 10 years
has been about 7% in real terms.

There has been massive capital formation in Botswana, Mozambique and South
Africa which has seen the construction industry contributing at least 35% of
gross domestic product. Kilometres of road and railway are being built in
the region and huge amounts of money have been spent in physical structure
construction. Johannesburg has become a modern metropolis that competes with
London and any other major city.

More importantly, there has been qualitative human development in these
countries. Little Malawi, for instance, is now producing 3,2 millions tonnes
of maize and the lives of the peasants have significantly improved. Botswana
and South Africa have made strides in abolishing the dual enclave economy
created by colonialism and the Hendrick Verwoerds of this world.

On the political front, progress too has been made in the region. New
constitutions have been written which have in general terms guaranteed
generational regeneration, a critical lacuna in Zimbabwe’s discourse.

Thus in the last 30 years alone Tanzania has had four presidents in Julius
Nyerere, Ali Hassan Mwinyi, Benjamin Mkapa and presently Jakaya Kikwete.
Mozambique too has had three presidents namely Samora Machel, Joaquim
Chissano and Armando Guebuza. South Africa, in its mere 19 years of freedom
is on its fourth president, Jacob Zuma.

Perhaps the most amazing of all has been Zambia. Despite its economic
challenges it has managed to reproduce itself. Now the 75-year-old Sata,
never mind what you think of him, is now the president of that beautiful
country.

The question that needs to be asked is: what makes Zimbabwe so unique in its
discord and insanity? What is within us that can destroy an economy which
was once fourth in Sub-Saharan Africa to the third smallest in Sadc?

Both the pre and post-Independence leadership must plead guilty to a
blinding lack of vision that has crippled the country. The colonial regime,
like any other colonisers, must plead guilty of under-developing this
country and Africa by benefiting the metropolis. A story nicely told by Ali
Mazrui and Walter Rodney among many others.

From Cecil Rhodes to Charles Coghlan, Howard Moffat, George Mitchell,
Godfrey Huggins, Garfield Todd, Edgar Whitehead to Clifford Dupont and Ian
Smith, this generation must plead guilty to the unforgivable crimes of
colonialism and imperialism. However, there was something so ruthless and
defining in the nature of colonial penetration in Zimbabwe to which we are
still paying a price.

Colonialism had many levels of penetration and integration in African
societies and economies. The French method of assimilation, adoption and
culturalisation was a more subtle and more peaceful a method.

But that cannot be said of Southern Rhodesian imperialism which was anchored
more on violence than the Bible. Right from the onset, violence has been a
major tool of national construction, penetration and reconstruction.

Every level of Rhodesia and Southern Rhodesia infrastructure was permeated
and dominated by violence in its various forms. The tragic situation is that
from 1890 – 1990, the geographical location of Southern Rhodesia has never
had a continuous 10 years of peace.

The belief is that violence as an arbitrator in politics has been carried
into an era where the state has transformed itself in various stages and
convulsions of cataclysmic dislocations. Remember Gukurahundi,
Murambatsvina, the violent land reform programme and of course the June 2008
presidential run-off.

However, Zimbabwe is not the only country where violence was used as an
instrument of coercion. Nothing can be worse than apartheid and violence
associated with the same, and yet post-Independent South Africa has shied
away from violence as a political instrument.

The difference in my view is leadership and the quality of leadership in the
two countries. Despite its faults and weaknesses, former South African
president Nelson Mandela foresaw, a long time ago, the importance of both
peace and nation building in a democratic South Africa.

That is why he was able to rise above whatever personal bitterness that he
may have had against the apartheid regime of robbing him of 27 years of his
life and ruining his relationship with his wife and children.

Mandela recognised the importance of a South Africa in which everyone is a
shareholder. In the pursuit of his vision, Mandela realised the obligation
and imperative of a leader in providing that legacy.  Leadership that is not
short term and that is decisive. That is why in his must-read, Long Walk to
Freedom, he wrote:

“There are times when a leader must move out from the flock, go off in a new
direction, confident that he is leading his people in the right way.”

Continued next week.

    Biti is Zimbabwe’s Finance minister and secretary-general of the MDC-T.

Empowerment policy foggy

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

Thursday, 06 October 2011 17:41

That government is in a quandary over how to implement its controversial
indigenisation and empowerment policy is now an open secret.
After years of talk, one would have expected government to now have a
clear-cut national vision on how it intends implement its empowerment
policy. But, alas, government appears to be groping in the dark.

As more and more companies seek to comply with the indigenisation
regulations, government has been left exposed after agreeing to alternative
empowerment plans from various companies. Old Mutual was paraded as a
shining example of how corporate citizens must behave after the company toed
the government line after months of threats from Indigenisation and
Empowerment minister Saviour Kasukuwere.

In as much as the programme is a national priority, it is clearly
inconsistent, suggesting it is not well-planned or there are ulterior
motives behind it.
While only a few question the necessity of the programme, it has become a
haven for politicking with contradictory stances by cabinet ministers in the
unity government, resulting in varying and confusing positions on
empowerment.

Such discord in government points to lack of clear position on policy.

Instead of ensuring the success of empowerment, there is an underlying
battle for control of the programme. Who should be approving proposals? Is
it the Indigenisation ministry or the National Indigenisation Economic
Empowerment Board?

It is increasingly clear that the board is a mere blip on the radar with the
ministry and Kasukuwere running the show after assuming all roles and
responsibilities of the board.

The nation should be wary of the programme being hijacked by corrupt people
who may have personal agendas like gaining political mileage in the face of
possible elections next year.

As we have previously maintained, the indigenisation policy should have
checks and balances to stop abuse for personal enrichment.
Why is there lack of consistency in such an important national programme
which has the potential to affect industry and much of the private sector?
Zimbabwe is struggling to emerge from economic melancholy with unemployment
levels are as high as 70%.  This is not the time to be playing Russian
roulette with the economy.

The country should take stock of the land reform programme, which only
benefited the well-connected few — mostly politicians — their relatives and
a negligible percentage of the general population which is struggling to
make the land productive.

As a result the masses have remained poor and congested in colonial
resettlement areas post-land reform.
Lessons from the land reform debacle must remain alive to ensure that
Zimbabwe achieves its set economic targets and is not waylaid by populist
rhetoric come electioneering time.

Government must come up with a clear-cut position on what it expects from
companies. We have seen company A cutting a deal with the ministry and
company B doing the same. Zimplats is surrounded by predators.

One wonders what card government is playing? The current drive is marred
with confusion and can be viewed as a way of engendering further mayhem.
A perfect example is of Old Mutual which was publicly threatened by
Kasukuwere that it would face the wrath of government if it did not comply,
only for a deal to be struck at the eleventh hour.

Strangely, Kasukuwere’s ministry found itself with a 2,5% equity worth US$10
million without a plausible explanation as to why Old Mutual had been that
generous.

The private sector should not be fooled by the acceptance of their proposals
by government officials. Business should remember what happened to members
of the Commercial Farmers Union who privately negotiated deals with
politicians during the land reform exercise.
Those farmers are still counting their losses to this day.

The private sector, and indeed the entire nation, must demand a clear policy
from government which is consistent with the provisions of the
Indigenisation Act and other laws of the country so as to avoid unnecessary
confusion.

Editor’s Memo: Implementation an outstanding issue

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

Thursday, 06 October 2011 17:39

Constantine Chimakure

SOUTH African President Jacob Zuma’s facilitation team is expected in
Zimbabwe next week. Top of its agenda is the finalisation of the roadmap to
free and fair elections. Expectations are high that it will shed light on
the dark corners that are the envisioned elections next year.

The three parties in the shaky inclusive government, Zanu PF and the two MDC
formations, have since agreed on most of the issues regarding the roadmap.
They now need to come up with feasible time lines leading to the
much-awaited elections slated either for next year or 2013.

While there seems to be progress in the convoluted political negotiations,
our optimism that the three parties will implement the tenets of the roadmap
with vigour and dedication is tempered by experience. The people of Zimbabwe
feel betrayed by Zanu PF and the two MDC formations who have failed before
to operationalise what they have agreed on. We have seen that with these
three bed fellows, it is one thing for them to agree and quite another
matter to implement what has been agreed on.

The three parties have failed to consummate fully the Global Political
Agreement (GPA) they signed in September 2008, which gave birth to their
marriage of convenience in February 2009. The failure to implement
outstanding issues of the GPA was largely a result of Zanu PF’s
intransigence and also leadership ineptitude on the party of the main
formation of the MDC led by Prime Minister Morgan Tsvangirai.

In a letter dated August 5, 2010 penned by Deputy Prime Minister Arthur
Mutambara on behalf of President Robert Mugabe and Tsvangirai to Zuma, the
principals said they had agreed on 24 outstanding issues of the GPA and the
implementation matrix. However, to date the implementation process has
remained a dead letter and is gathering dust.

Mugabe has repeatedly refused to appoint provincial governors from the MDC
formations despite being mandated do so as part of the GPA.
Despite agreeing to media reforms, Mugabe and Zanu PF have ensured that the
national broadcaster, ZBC, maintains its archaic monopoly.

The land audit, which would have brought sanity and accountability to the
land issue, remains a pipedream. The efforts of the National Organ on
Healing and Reconciliation have been rendered useless as incidences of
violence across the country continue unabated.

These few examples of the outstanding issues of the GPA beg the question:
what will change now with the roadmap? The MDC-T has failed dismally to
continue to push for the implementation of outstanding issues. The sticking
points are no longer on their radar. They have joined the election roadmap
campaign, even though it is as clear as day that — without real reforms —
the future of the party and the country is bleak.

What we have noticed over the past year is that the three political parties
have rarely spoken about these outstanding issues. Their focus has been
shifted to the roadmap. It seems our rulers are now more concerned with the
end-state (the elections) instead of processes. This is called fallacy of
composition.
Without preamble, there should be a full consummation of the GPA: media,
electoral and legislative reforms; security sector reforms; and a well
thought out national healing programme.

How do we go into an election with a security sector not subservient to the
electorate and which threatens to subvert the will of the people? How can we
have an election in a scenario where the mechanisms of the transfer of power
remain vague? How can we have a partisan public-owned broadcaster which
shamelessly churns out hate speech and props-up one political party at the
expense of others?
Explanations are required.

Candid Comment: Infrastructure crucial to hasten economic recovery

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

Thursday, 06 October 2011 17:35

Itai Masuku

GIVEN the results that have been reported in the just ending June earnings
season one can see that there are signs that the economy is improving,
albeit very slowly. Of course, one risks having brickbats thrown at them for
making such a statement. But to again quote John Naisbit of the Megatrends
fame, things do happen, only a bit more slowly.

So what are these improvements? Let’s begin at the beginning. In much the
same way as colonial history tends to portray as though everything in
Zimbabwe began only in 1890, in our case, everything begins in February
2009, upon the adoption of the multicurrency system that is now commonly
referred to as dollarisation.

The actual position is that we are in a multicurrency system, where in the
Matabeleland economy, the rand is more in use than the US dollar. But again,
just like the politics of the country, what happens in that region does not
matter, so we shall stick to the term dollarisation. Upon dollarisation,
there was hardly US$500 000 in the banking system. As we now know, there is
now US$3 billion plus and indications are that this continues to rise.

The second positive is that we have generally had price stability, with the
annual rate of inflation remaining below 5%, having averaged 3% in the early
dollarisation period.

This is truly commendable, moreso if one considers that for a long time the
struggle was to achieve single digit inflation. Our Gross Domestic Product
has been growing by more than 5% per annum, though one prefers to look this
more as economic recovery than growth. There has definitely been a steady
increase in aggregate consumer demand as reflected by the improving sales by
retailers.

Yes, the margins are not what some of the retailers may desire, but there is
clearly demand. In terms of the general retail for the low income bracket,
the pattern is shifting from huge stores to what one may term boutiques,
small little shops with hardly 10 square metres, evidence of Chinese and
Nigerian influence. Owners of buildings have responded to this trend by
reconfiguring their buildings to fit these little shops. Demand for these
boutiques is so high that owners charge up to US$20 000 goodwill just to
rent the shop, and monthly rentals on thereof.

In terms of investor activity, the Zimbabwe Stock Exchange, the barometer
for such incoming investment has had foreigners accounting for 70% of trade,
until they began to pull out in reaction to indigenisation laws. In terms of
employment, well, again one risks a tonne of bricks falling on them but the
fact is there have been more jobs created in the informal sector. Others may
say this is no good, we need more formal jobs. Well, try telling that to the
man who guards my car when I go to Julius Nyerere Way; he’s been living off
that since I knew him as boy in the mid 1990s.

Clearly the way forward in terms of employment in this country is the
informal sector and the small and medium enterprise sector. However, the
biggest letdown is the lack of infrastructure development to support the
growing economic activity in the country. This lack of infrastructure is
holding back growth, or rather, recovery.  The much talked about Public
Sector Investment Programme has never taken off as all subsequent
governments in this country have been running yawning deficits caused by
heavy recurrent expenditure.