Thursday, 13
September 2007, 07:30 GMT 08:30 UK
Archbishop Ncube - many believe he was a victim of CIO
agents | Pius Ncube is
widely believed in Zimbabwe to be the latest victim of dirty tricks by the
feared Central Intelligence Organisation (CIO).
Bishop Ncube, who has just resigned as the Archbishop of
Bulawayo, has been a vocal critic of the government.
In July this year, he called for foreign intervention to remove
President Robert Mugabe.
A week later, he called the president a "megalomaniac, a bully
and a murderer".
Barely two weeks after that, state media gleefully published
photos - allegedly of Bishop Ncube in bed with a married woman.
The bishop denies the allegations but the scandal has led to his
resignation, with her husband suing him for damages.
"The CIO manufactured all that," says Tendai Biti, secretary
general of one faction of the opposition Movement for Democratic Change (MDC).
"He fought the regime and the regime fought back."
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ALLEGED DIRTY TRICKS
Pius Ncube - adultery
Morgan Tsvangirai - treason plot
MDC - infiltration split
Ndabaningi Sithole - attempted assassination
|
Bishop Ncube himself talks of the "crude machinations of a
wicked regime" but vows: "I will not be silenced".
He has, however, lost his job and it remains to be seen whether
his voice will carry the same influence without the backing of such an
influential post.
Lovemore Madhuku from the National Constitutional Assembly,
which campaigns for political reform in Zimbabwe, says that as soon as you stand
up and criticise the government, you are taking a huge risk.
Opposition activists have been beaten up, tortured and even
killed but CIO agents also employ subtler methods, such as those many believe
were used against Bishop Ncube.
"They visit your husband, or your wife, or your workplace and
try to interfere in your day-to-day life," Mr Madhuku told the BBC News website.
Madhuku: the CIO find ways to interfere in your day-to-day
life |
"They are very clever," he says. "They cannot force you to have
an affair but they study you, so they can take advantage of your weaknesses."
He says that other favoured methods are to entrap businesspeople
into doing something illegal, like dealing in foreign currency.
They then keep this information and use it against you when they
judge the time is right, blackmailing you into giving up politics.
Mr Madhuku says CIO agents have repeatedly gone to the
University of Zimbabwe, where he works in the law faculty, to try to get him
sacked.
He says they have successfully managed to stop him taking a
high-profile role in his church.
Spreading mistrust
The CIO reports directly to the office of the president and
agents are selected on the basis of their loyalty to Mr Mugabe and his Zanu-PF
party.
It has a massive budget despite Zimbabwe's economic woes, access
to the latest technology and a massive network of informers.
"You don't know who you're talking to, who you can trust," Mr
Biti says.
Mr Tsvangirai was acquitted after a long treason trial in Harare
|
He says they have infiltrated every structure of every
organisation in the country. And opposition parties are first in their firing
line.
Two years ago, the MDC, which has presented Mr Mugabe with its
strongest challenge since he led Zimbabwe to independence in 1980, split into
two factions, making it far less effective.
Many see this as another CIO coup.
Mr Madhuku says their agents infiltrated the highest levels of
the party and successfully played on the egos of top MDC officials.
One group, including the party's secretary general and
vice-president, accused leader Morgan Tsvangirai of over-ruling a vote taken by
a majority of the party`s leadership.
Mr Madhuku says undercover CIO agents would have gone to Mr
Tsvangirai and told him: "You're the leader, you must be decisive."
Then other agents would have approached people like Secretary
General Welshman Ncube and said: "That Tsvangirai is a dictator. Our party is
based on the fight for democracy, so we must all obey the rules."
Going back and forth between the different camps, the agents
eventually sowed discord, personality clashes and eventually a split, which
greatly weakened the party.
This was not the first time that Mr Tsvangirai had been
targeted.
Trumped-up treason
Just weeks before the 2002 presidential election, he was charged
with treason, based on the evidence of Ari Ben-Menashe, a Canada-based political
consultant.
Grainy footage of the CCTV tape of Mr Tsvangirai (R) was sloppy
|
He testified that in a secretly-filmed meeting in December 2001,
Mr Tsvangirai had asked him to arrange the assassination of President Mugabe.
As evidence, he produced a grainy tape-recording.
However, on that occasion, the CIO's standards had slipped and
it was obvious that the tape had been heavily edited in an amateurish attempt to
put incriminating words into Mr Tsvangirai's mouth.
The clock in the corner of the CCTV footage kept on flicking
backwards and forwards.
With its tentacles reaching into every facet of Zimbabwean life,
the CIO no doubt tried to ensure that a compliant judge heard the case.
But for whatever reason, on this occasion, their plans failed
and Mr Tsvangirai was acquitted.
Nevertheless, the possibility of a death sentence must have been
a huge distraction for the opposition leader for more than two years, making him
less of a threat to Mr Mugabe.
He was not the first opposition leader to be tried for treason
on spurious grounds in Zimbabwe.
Reverend Ndabaningi Sithole, Mr Mugabe's rival for more than 20
years, always claimed that he had been set up when he was charged with trying to
assassinate Mr Mugabe in 1997.
On this occasion, he was found guilty and sentenced to
two-and-a-half years in prison, although he died, aged 80, before serving any
time.
Before the treason charges, another CIO ploy to discourage one
of only two opposition MPs at the time, had been to show Rev Sithole a document
allegedly showing that his wife was having an affair with a government minister.
Mr Madhuku says such petty interference, as much as the threat
of physical violence, is why many ordinary Zimbabweans decide not to get
involved in politics, despite the country's economic collapse.
Mr Biti concurs, and says: "Mr Mugabe owes his position to dirty
tricks and the 'securicrats' who invent them. The 'securicrats' are the real
brains of this regime."
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Mugabe to cut powers
FinGaz
Clemence Manyukwe Staff Reporter . . .
But moves to tighten hold on party PRESIDENT Robert Mugabe has agreed to shed
some of his sweeping powers in talks between his party and the opposition
Movement for Democratic Change (MDC), but at the same time he has begun
consolidating his hold on ZANU PF, ahead of a special congress where he will
seek to crush factions vying to block his candidacy.
The ruling
party's supreme decision-making body - the Politburo - last week decided to
call an extraordinary congress in place of a conference that had been
pencilled for December. ZANU PF insiders said the congress will give
President Mugabe, who had earlier hinted at retiring at the expiry of his
current term only to change his mind after the race to succeed him split the
ruling party right through the middle, a chance to finally get official
endorsement as ZANU PF's presidential candidate. But the decision also
shows that some opposition to his bid remains, despite public endorsements
he has received from the leaders of the Women's League and the Youth League
plus war veterans, chiefs and ZANU PF mayors. The extraordinary congress has
been called to choose the party's presidential candidate for elections next
year, Vice President Joice Mujuru was quoted as saying this
week. According to ZANU PF sources, President Mugabe's supporters are now
stepping up a campaign for Mujuru's ouster. Mujuru and Rural Housing
Minister Emmerson Mnangagwa are linked to factions jockeying to succeed the
ageing Zimbabwean leader, in power since the country's independence from
Britain in 1980. Recent public comments made by senior members of the ZANU PF
Women's League, regarded as critical of Mujuru, are part of a wider strategy
to sideline her ahead of congress, the sources said. But insiders say
although there are dissenting voices in the ruling party, there is little
chance President Mugabe will face an open challenge at congress. Unlike
the conference, which had been planned earlier, congress draws huge crowds,
particularly from the boisterous war veterans and the party's youth and
women's leagues, where President Mugabe enjoys strong support. "There is
resistance, but unless something extraordinary happens, he will be
nominated," a Politburo member said yesterday. President Mugabe has,
since the Goromonzi conference last December, shown increasing unease with
the Mujuru faction, which he backed against Mnangagwa at the 2004
congress. In an interview with state television to mark his birthday in
February, the President criticised what he said was "an insidious dimension
(in ZANU PF) where ambitious leaders have been cutting deals with the
British and Americans", and voiced his opposition to involvement by his top
lieutenants in diamonds. This was widely seen as a dig at retired army
general Solomon Mujuru, the only one of his top officials with known
interests in diamonds. The retired general is Vice-President Mujuru's
husband. And at the weekend, Herald columnist Nathaniel Manheru, who said the
congress would need to "secure its leader", referred to a "British-run
faction, which has been seeking to worm itself to influence. It is a
faction, which is greedy, anti-nation, a bit daft, without structures, but
well heeled and quite white at its core." President Mugabe's ZANU PF
supporters, Manheru suggested, were moving "relentlessly to pare down the
power claims of this faction." Supporters of President Mugabe have cast him
as the remaining authentic revolutionary in the ruling party. Apart from
fighting other factions, radical ZANU PF supporters have sniped at any hints
at the need for reform, especially after comments in South Africa by Simba
Makoni the former finance minister, who merely acknowledged that there was
an economic crisis in the country. Over recent months, the women's and
youth leagues, chiefs and war veterans have endorsed the President for the
harmonised 2008 elections. Justice Minister Patrick Chinamasa yesterday
tabled the 18th amendment, but debate on it will only begin on
Tuesday. The Bill will help President Mugabe manage his succession, but it is
the unexpected call for a special congress that reflects the continuing
scheming within ZANU PF over his future. Jabulani Sibanda, sacked as war
veterans leader in a row some linked to the succession battle, is suddenly
back in favour, leading a march in President Mugabe's support two weeks
ago. Sibanda has been linked to the Mnangagwa camp, although he has denied
this in previous comments to The Financial Gazette. However, signs that
support among war veterans for President Mugabe, though strong, is not
unanimous, came last week when there were clashes in Masvingo between groups
supporting rival factions of the party. The Politburo meeting also discussed
and approved changes to the original wording of the Constitutional Amendment
No.18 Bill, changes that will limit President Mugabe's powers, especially
his influence over Parliament. The changes were agreed after ZANU PF tabled
the Amendment as an agenda item in the talks, spearheaded by South African
President Thabo Mbeki. A 210-member House of Assembly will be constituted
entirely by elected members, unlike the previous plan where the President
could appoint 10 members. The President would still choose governors,
three members from interest groups, and have influence over the appointment
of chiefs to an expanded 93-member Senate. But the lower house would have
the power of veto on the upper chamber, again diluting the influence of his
appointees. The constitutional changes would also see the Delimitation
Commission being abolished, and its work taken over by the Zimbabwe
Electoral Commission. "We will be going back to the 20 percent (constituency
population) variance factor, from the current 25 percent, which created huge
urban constituencies and small rural constituencies," a source said. This
arrangement had the effect of creating more rural constituencies than urban
seats. Since 2000, the Delimitation Commission has controversially increased
seats in rural areas, a ZANU PF stronghold, while seats in the urban areas,
where the MDC draws most of its support, were gradually reduced. Sources
said the ruling party was also debating excluding Registrar General (R-G)
Tobaiwa Mudede from all involvement in elections. The opposition sees the
R-G as a ZANU PF appointee.
Chaos at border posts as ZIMRA workers strike
FinGaz
Shame Makoshori
Staff Reporter
THE country's ports of entry plunged into a crisis
yesterday after the Zimbabwe Revenue Authority (ZIMRA) workers went on
strike to press for a 5 700 percent salary increase, The Financial Gazette
established.
The work stoppage could have cost ZIMRA at least $1 trillion
in revenue alone on the first day of the strike, besides inconveniencing
thousands of cross-border travellers battling to clear imports into the
country. All non-managerial employees at ZIMRA, estimated at over 2 000, had
joined the work stoppage, which comes at a time when government has imposed
a blanket freeze on salary adjustments to rein in rampant inflation,
currently topping 7 600 percent. Sources within ZIMRA told The Financial
Gazette yesterday that the negotiations between workers and management had
collapsed on Tuesday after the authority refused to grant the 5 700 percent
salary increase, arguing this was beyond the revenue authority's
budget. The 5 700 percent increment could have lifted the salary of revenue
specialists, the equivalent of bank tellers in a financial institution, to
about $87 million per month, up from $1.5 million per month they are
currently earning. Workers warned that while government was in des-perate
need for revenue, ZIMRA's refusal to award workers the salary adjustment
could be a major blow to the ailing economy. "Companies had started
remitting Pay as You Earn (PAYE) deductions because we are approaching the
15th of September. That is about $1 trillion revenue per day that the
government is losing," said a senior ZIMRA employee. "There are serious
problems at the Beitbridge border post because after the Immigration
Department clears passengers, there is no one to do the customs clearance.
All the border posts have been affected except Forbes near Mutare because of
communication problems there," the source said. ZIMRA management had offered
the workers a 400 percent increment to be implemented this month. This
would have taken the salary of a revenue officer to $10 million at a time
the poverty datum line is estimated at over $15 million. The workers, who
also seemed to ignore a government directive for a price and salary freeze,
spent most of the day holed up in an open office at one of ZIMRA's buildings
in Harare yesterday. They said the industrial action had started at the
Beitbridge border post, one of Africa's busiest ports, at midnight
yesterday, before spreading to Chirundu, Nyamapanda and other border posts
causing serious confusion among travellers and investors seeking to clear
their goods. The Beitbridge border post clears a number of vehicles daily,
some of which are in transit to Zambia, Tanzania, Malawi and the Democratic
Republic of the Congo. Sources however, said it was the disruption in
Harare that would be a big blow to revenue collection because at this time
of the month, about 85 percent of ZIMRA's revenue collections came from the
capital through corporate tax payments as well as Value Added
Tax. ZIMRA's corporate communications department had not yet responded to
written questions submitted yesterday by the time of going to press. It
is understood that ZIMRA has lost between 10 and 15 key staff members every
month since January due to poor salaries. This is, however, not the first
time ZIMRA has clashed with its workers over salaries. In 2005, the
Labour Court ordered the revenue collection authority to award a 200 percent
salary increment but ZIMRA pressed on with its decision to award a 17
percent increment leading to threats by the workers to down tools. ZIMRA
is under pressure to increase revenue collection to replenish the state's
depleted coffers as escalating costs of goods and services have taken their
toll on the fiscus.
New rules empower govt to take over firms
FinGaz
Rangarirai Mberi
News Editor
NEW measures freshly authorised by President Robert Mugabe to
bolster the price war make it easier for government to wrest control of
private companies under the guise of resuscitating them.
Statutory
instrument 159A, meant to widen the powers of the National Incomes and
Pricing Commission (NIPC), allows the state to appoint an administrator to
take over management of any company that stops or cuts production due to the
price clampdown. The instrument, published last week, is made under
Presidential Powers (Temporary Measures) regulations. The measures appear
to vindicate suspicions that the widely condemned price blitz may be
targeted at specific companies, which government might want to take over in
order to influence the pricing of goods and services. Targeted for takeover,
according to sources, could be major producers of basic commodities such as
milk, sugar, bread, mealie-meal and cooking oil. At the moment, government is
claiming links to the indigenisation drive of the acquisition by the Cotton
Company of Zimbabwe of H.J. Heinz's 49 percent stake in food manufacturer
Olivine Industries. Government is also in the process of enacting a law
compelling foreign-owned companies to give up 51 percent shareholding to
locals as part of new measures to empower previously disadvantaged
blacks. Now, government can issue new shares in a company it takes over,
appoint its own directors, and raise capital without the approval of the
owners, according to the latest regulations. The instrument says "where
the enterprise is a private company, an order declaring it to be a public
company, whereupon such enterprise shall for all purposes be deemed to be a
public company", can be issued by the NIPC. An administrator will be
appointed to take over a company whose owners have "discontinued"
production, the instrument says. However, it is vague on how it determines
the cause behind the stoppage of production, defining a "discontinuation" as
when the owner ceases "to properly or adequately operate or supervise the
enterprise". The instrument claims to target "essential enterprises", and
defines such a company as one that manufactures "any commodity used by the
public generally, or any significant section of the public." A broad
range of sectors are listed as essential: manufacturing, distribution, fuel
supply, retail, commuter transport, health services, mining,
telecommunications and finance. However, an essential company, according to
the instrument, can also be "any other enterprise the Minister (of Industry
and International Trade) deems to be an essential service." Government
will compensate for any damage suffered by a company under
administration. However, in calculating any compensation, allowance will
be made for "any dam-age or deterioration, which would probably have
occurred had the enterprise not been subjected to temporary administration,
and the value of any improvements effected during the period of the
temporary administration." The NIPC will determine the length of a period
of administration, at the end of which an order can be issued extending the
period for a further three months. Should the NIPC choose to return a
company to its owner, and the owner does not "continue it to the
satisfaction of the Commission within seven days after repossession," or
discontinues production within three months, the administration order will
be reinstated. Administrators, who can be drawn from the military or the
police under the rules, will be appointed with the consultation of the
Industrial Development Corporation or the Zimbabwe Development
Corporation. Before an administration order can be issued, an NIPC inspector
is sent in to "ensure the continuation of essential services". The inspector
is allowed to "break open the doors and windows of the premises if he or she
has failed to obtain admission after having audibly demanded
admission." The inspector will take an inventory of all equipment and stock,
and demand all information on the conduct of the business, including the
names and addresses of owners and creditors. The new rules represent a
further escalation by government of its war on business, which began in June
with an order for a 50 percent price cut and continued last month with a
salary freeze. The price war, which virtually outlaws real profits and has
caused massive shortages, has driven industry to the brink, forcing many to
drastically scale down operations by shutting down plants and idle floor
space. However, industrialists now face the prospect of losing their
businesses if they either stop or reduce production to prevent further
losses. Over 7 000 traders, from the heads of listed corporations to small
retail operators, have been arrested since the crackdown began.
Chinese diplomat reveals why Zim deals are dead in the
water
FinGaz
Clemence Manyukwe Staff Reporter
A STRING of commercial
agreements signed with China have failed because Zimbabwe cannot raise both
the foreign and the local currency to back the projects, a senior official
at the Chinese mission in Harare has said.
Liu Joe, trade attaché at the
Chinese Embassy told The Financial Gazette last week: "Zimbabwe does not
have the foreign currency needed for the projects. In some cases, they do
not have the local currency." Liu said he did not have actual figures showing
how much Zimbabwe needed to raise for the outstanding investments. He also
declined to discuss Chinese aid to Zimbabwe saying the issue was
confidential. Chinese involvement in Zimbabwe has come under renewed scrutiny
in recent weeks after Mark Malloch-Brown, British foreign secretary, claimed
in a newspaper interview that he had been assured by a senior Chinese
government official that the Asian giant had stopped all non-humanitarian
aid to Zimbabwe. China has dismissed the claims. The government
adopted a "Look East Policy" in 2002 when the European Union and some
western countries slapped sanctions on President Robert Mugabe's government
and restricted commercial links with Zimbabwe. Under the "Look East Policy",
the government has over the years trumpeted what it described as big deals
with the Chinese. But tangible Chinese investment has yet to
materialise. One of the biggest deals was announced in November 2005, after
Vice President Joice Mujuru and Water Resources and Infrastructure
Development Minister, Munacho Mutezo, signed an agreement in China with the
Jiangxi Corporation of International Economic and Technical
Co-operation. Officials said at the time that the company would build Kunzvi
Dam and provide irrigation equipment to boost food security, in exchange for
mineral concessions. However, Kunzvi Dam remains "in the pipeline", with
many urban centres still going without regular water supplies. Promised
Chinese investment into a methane gas project in Lupane is also yet to
materialise. The government has also previously announced it was negotiating
a US$2 billion loan facility from China for the stabilisation of the
economy. But China - even with its colossal US$1.4 trillion foreign reserve
- has not extended much in loans to Zimbabwe.
Economy won't collapse: Gono
FinGaz
Staff Reporter
RESERVE
Bank of Zimbabwe (RBZ) governor Gideon Gono has said Zimbabwe will not
collapse due to the economic crisis that has engulfed the country, arguing
the country will finally come out of its present quagmire.
Speaking in a
recent wide ranging interview with the London-based New African magazine on
the future prospects of the economy, which has suffered eight years of a
successive recession, Gono, said that "armchair critics" should instead
blame Western sanctions for Zimbabwe's problems. "Let me just say Zimbabwe
will not die," Gono said. "We will have bruises here and there, but we will
not die. And we will not tell the whole world our strategies for survival
because we have been betrayed before," he added. The central bank chief has
spearheaded the country's campaign for an economic revival since taking over
the central bank governorship in late 2003. In 2005, Gono committed the
country's meager foreign currency reserves to clear a US$275 million debt
with the International Monetary Fund (IMF), in the process averting an
embarrassing expulsion of Zimbabwe from the IMF's membership. But the
governor expressed his disappointment with the international financial
system, saying it had been politicised and was in urgent need of
"transformation". "We have been very disappointed with the action of
institutions that are supposed to be apolitical," Gono said. "I am afraid
to say that the multilateral institutions of this world leave a lot to be
desired. I should say we have greater faith in ourselves than outside
ourselves (but) we will welcome support from whatever quarter; that support
should be predicated on actions that we take voluntarily." "There is need for
us to reform these institutions. We continue to remain a member but working
for its (IMF) transformation. He defended the printing of money by the
central bank, arguing those who blamed him for the actions were "armchair
critics." "Only the bullfighter knows exactly what goes on in the ring. It is
easy to criticise, but what alternatives do you proffer in an environment
where we can't get the traditional BoP (balance of payments) support. If you
look at the impact of sanctions on this economy, you will then see how the
drying of resources has affected us," said Gono. He argued that the
printing of money to sustain lives, to build infrastructure, a springboard
from which to leap forward, "cannot be bad." "After the Great Depression in
the 1930s, the United States had to print money to finance some of the
infrastructure that the current generation are proud to have. Look at the
bridges across many rivers and other infrastructure that were built with
high budget deficits," Gono said. "When these people in the rural areas say
we want a dam, they want to see water. They do not care where the funds come
from".
Forex duty on underwear
FinGaz
Staff Reporter
FOR goods
ranging from underwear to fridges, from shoes to carpets, government now
wants duty in foreign currency.
An expanded list of what government
defines as "luxury items" is contained in a statutory instrument, the
Customs and Excise (Designation of Luxury) amendment notice that came into
effect last Friday. It was gazetted a day after Finance Minister Samuel
Mumbengegwi announced he would expand the list of goods for which duty would
now be paid in foreign currency. Earlier this year, government slapped
foreign currency duty payment on the importation of motor vehicles, saying
cars were luxury items, and that their importation was hurting the local
motor industry - which, essentially, is two companies. Now government has
released a new list of hundreds of other products that will be considered
luxury items, and for which duty in foreign currency will have to be
paid. The list classifies virtually all forms of clothing as luxury
items. This includes footwear, and underwear for both men and women - and the
instrument describes these at length; the bras, the panties,
hosiery, and even girdles, veils, gloves and ties. Duty for all types of
carpeting, "refrigerators of a household type", cookers, bed linen, blankets
- excluding, surprisingly, electric blankets - will also be charged in
foreign currency. According to the instrument, duty for most clothing
will be charged at 60 percent of its value, plus at US$10 per
kilogramme. Goods such as bed linen will attract duty of 50 percent, plus the
US$10 per kg. Fridges and cookers will be charged at 60 percent and US$45
per item.
2005 spying case: High Court orders hearing
FinGaz
Clemence Manyukwe
Staff Reporter
THE High court has ordered the Attorney General (A-G) and
the Master of the High Court, Charles Nyatanga, to facilitate the hearing of
an appeal by three men convicted in 2005 of spying on ZANU PF, following
numerous postponements as a result of the state's failure to get its case in
order.
The three appellants, former ambassador-designate to Mozambique,
Godfrey Dzvairo, former Metropolitan Bank secretary Tendai Matambanadzo, and
ZANU-PF's ex-director for external affairs, Itai Marchi, were jailed in 2005
for espionage following their arrest the previous year. Harare Magistrate
Peter Kumbawa sentenced Dzvairo to six years in jail, and the other two
accused to five years each, but they are appealing against both conviction
and sentence. The appellants were charged with breaching the Official
Secrets Act. Court records show that High Court judges Lawrence Kamocha and
Ben Hlatshwayo ruled last month that the A-G must immediately file the
state's heads of arguments in the matter, and that the Master of the High
Court should set down the appeal date in the first week of this
month. Both orders have, however, not been complied with. Neither have
further court papers been filed nor a date set for the hearing. Documents
show that lawyers for the three men have now written to the A-G and
Nyatanga, protesting at their failure to abide by the ruling. Harare lawyer
Selby Hwacha represents the appellants while prosecutor Joseph Makwakwa
represents the state. Last December, Justice Anne-Marie Gowora postponed the
matter indefinitely after the A-G had failed to file the required court
records. Dzvairo, Matambanadzo and Marchi were convicted of supplying
information about ZANU PF to foreign governments, including South
Africa. During their trial, they claimed they had been tortured in
custody. They pleaded guilty to the charges at their first court appearance
on December 24, 2004, but later sought unsuccessfully to change their pleas
on the grounds that their confession had been extracted under
duress. Businessman Phillip Chiyangwa, then a ZANU PF Member of Parliament,
and Kenny Karidza, a top ZANU-PF security officer, were also arrested in
connection with the sensational case. They were subsequently set free.
Govt tables land tax for A2 farmers
FinGaz
Clemence Manyukwe/ Shame
Makoshori Staff Reporters
THE government has tabled a law in Parliament
imposing a new tax on A2 farmers, with those failing to pay risking eviction
from properties allocated to them.
Government has previously insisted
that no taxes would be levied on resettled farmers, but its new proposals
show an increasing desperation to replenish depleted coffers. Apart from the
farm tax, which comes into effective next month, the proposals, contained in
the Finance Bill, also give Finance Minister Samuel Mumbengegwi sweeping
powers to introduce regulations amending or replacing rates of taxes,
duties, levies and other charges. On the whole, the new Bill contains
amendments to the Finance Act, Income Tax Act and Customs and Excise Act.
Notably, it covers the controversial payment of customs duty in foreign
exchange. "This clause will insert a new chapter in the Finance Act, which
sets out the rates of rental to be charged on holders of offer letters in
respect of, or leases of, Model A2 farms allocated to them by the State,"
reads part of the proposed law. "The minister responsible for the gazetted
land (Consequential provisions) Act (chapter 20; 28) (No8 of 2006) shall
cancel the offer letter of any holder thereof who fails to pay rentals for
three consecutive quarters," the proposals say. Presenting his maiden
supplementary budget last week, Mumbengegwi said the tax would be based on
land size and ecological region in which the farm is located. The tax, he
said, would be pegged at levels that do not threaten the viability of
farming. Government had introduced lease rentals to raise revenue and
enforce maximum utilisation of productive land, said
Mumbengegwi. "Following the successful completion of the agrarian reform
programme, there now exists a large number of potential taxpayers involved
in the farming business," Mumbengegwi said. "It is therefore, essential that
the current farming taxation regime be reviewed, with the objective of
encouraging full utilisation of the allocated land." Last year, State
Security, Lands and Resettlement Minister Didymus Mutasa, clashed with
retired army chief and now ZANU PF Gutu senator Vitalis Zvinavashe, during a
lands committee hearing over whether a new tax should be slapped on
resettled farmers. Zvinavashe had proposed that government tax the new
farmers to fund compensation for dispossessed white farmers. However,
Mutasa said the farmers should concentrate on farming only, without having
to carry the extra burden of taxation. "The politicians are refusing to pay,"
Mutasa said at the time. "That land was simply taken from us through
conquest. It belongs to all of us. The farmers should concentrate only on
farming activities."
Lawyers spotlight wage freeze decree
FinGaz
Njabulo Ncube Political
Editor
THE Law Society of Zimbabwe (LSZ) is collating legal opinion from
experts on the decree issued by President Robert Mugabe ordering a six-month
salary freeze, with a view to mounting a legal challenge against the
controversial order.
President Mugabe recently invoked the
Presidential Powers (Temporary Measures) Act, to order that "no employer
shall increase the remuneration of any employee on account of an increase in
a consumer index, on account of an increase in any official or unofficial
rate at which the Zimbabwe dollar may be exchanged for other currency,
increase in a consumer price index and an increase in any official or
unofficial rate at which the Zimbabwe dollar maybe exchanged for any other
currency." The order stipulates that salary or fee increases can only be made
in future with specific approval from the National Incomes and Pricing
Commission, a body that President Mugabe directly controls, and without any
link to galloping inflation, which currently stands at over 7600 percent.
The LSZ deliberated over the statutory instrument at its meeting last
Thursday and resolved to tackle the issue, which has irked labour
unions. Beatrice Mtetwa, president of the LSZ, confirmed an opinion was being
sought over the decree, described last week by the Zimbabwe Congress of
Trade Unions as "satanic". "The council has resolved to get an opinion on
the statutory instrument and depending on that, there might be another
resolution. Council felt that six months is too long a period at a time when
employees are suffering," said Mtetwa. She said upon receiving expert
opinion, the council would make a decision. Heads of labour unions will
eagerly await the outcome of the LSZ consultations. The ZCTU has already
threatened industrial action if the statutory instrument is not removed. The
union has said the instrument runs counter to international labour
conventions and is in violation of a fragile protocol on Incomes and Price
Stabilisation signed in June by government, business and labour. Disquiet
in labour grew last week after statistics supplied by Finance Minister
Samuel Mumbengegwi, in his 2007 supplementary budget statement, revealed
that President Mugabe's annual salary had been raised by $1.4 billion. In
the original 2007budget, the President's salary had been put at $62.3
million, but was revised by $1 462 305 000 in the supplementary budget.
Illicit diamonds probe team misses own deadline
FinGaz
Clemence
Manyukwe Staff Reporter
THE Kimberly Process (KP), the global
dispensation for preventing trade in conflict diamonds, has missed a
self-imposed August deadline to make known the findings of an investigation
conducted in June into allegations of diamond smuggling in
Zimbabwe.
The KP sent a six-member team that met government officials and
inspected the Chiadzwa diamond fields in Marange district, as well as River
Ranch diamond mine in Beitbridge. The probe followed claims that rough
stones from the two areas were being smuggled out of the country. A KP
spokesman told The Financial Gazette that the report was not yet out, but
gave no reasons for the delay, or when the findings were now expected. The
European Union currently holds the rotating KP chairmanship. Christiane
Hohmann, spokesperson for External Relations and European Neighbourhood
Policy European Commission, said: "Unfortunately, the report you refer to is
not finalised yet. Therefore, it is impossible to provide you with any
detail of the findings of the report or to comment on it." In an interview on
Monday, a representative of Bubye Minerals, which made allegations of
smuggling against rival investor River Ranch Limited, said a complaint
against the probe team had been lodged after the delegation refused during
its visit to meet Bubye officials to get the company's evidence. Bubye
and River Ranch Limited are involved in an ownership wrangle over River
Ranch Mine. The dispute is before the courts. "We are not surprised by the
team's failure to produce the report, because it was non-inclusive, and the
team was subject to a controlled and pre-determined itinerary," said Bubye
Minerals lawyer Terrence Hussein. "The team, in fact, informed my client that
they were under strict instruction not to speak to Bubye Minerals Private
limited. Bubye has since launched an official complaint at the manner with
which the KPC team conducted itself in Zimbabwe." Hussein said Bubye
wants to be heard like the other parties that had their say during the
probe.
Chinese fertiliser last hope for new season
FinGaz
Zhean Gwaze Staff
Reporter
Zimbabwe's farmer groups hope that a consignment of fertiliser
expected from China will avert what experts say is yet another disastrous
start to the farming season.
Hardest hit by worsening input shortages
are tobacco farmers, who had planted enough seed to cover 95 000 hectares,
with the aim of increasing production in the coming season from this year's
77 million kilogrammes to 120 million kg. Compound C fertiliser, which
tobacco farmers require at the planting stage is in critically short supply,
the Tobacco Industry and Marketing Board (TIMB) said. "The situation
regarding the fertiliser situation is that there is no fertiliser on the
market. We hope that the consignment coming from China arrives on time to
save the crop. Otherwise only contracted tobacco growers are accessing
imported fertiliser from their sponsors," said the TIMB. The country has
experienced perennial fertiliser crises owing to the unavailability of
foreign currency. But this year, the fertiliser supply situation has been
made particularly dire by the closure of Dorowa Mine, Iron Duke and Zimphos,
key suppliers of raw materials to the fertiliser-manufacturing
sector. Media reports said recently the three companies had closed due to the
unavailability of various raw materials and power cuts. Cash-strapped
Zimbabwe requires US$45.6 million for the refurbishment of the plants in the
next three years to ensure production levels are maintained at 100 percent
or 552 000 tonnes of fertiliser annually, industry players have
noted. The sector also requires US$5.9 million per month to procure raw
materials such as potassium, which is imported from the Middle East, Chile
and Europe and sulphur from South Africa. Seed maize is also not readily
available on the market, threatening the summer cropping season. Zimbabwe
Farmers Union official Blessing Chifeya said although seed was sold on a
limited scale, farmers also faced challenges in accessing tillage
facilities. Another poor farming season would have a devastating effect
on Zimbabwe which hoped for better fortunes this year after seven years of
poor harvests, largely blamed on disruptions to production on farms
following the violent take over of land from white farmers. Falling food
production coupled with an unprecedented economic meltdown has resulted in
most Zimbabweans depending on food handouts from international relief
agencies.
Bare pantries, hungry kids, no teachers
FinGaz
Zhean Gwaze Staff
Reporter Boarding schools now the ultimate schoolhead's
nightmare THIRTY-FOUR year old Sekai Muchikichi recounts nostalgically the
story of her life as a boarder at a high school in Masvingo, and visualises
the daily menu card that was pregnant with what to a boarder were sumptuous
meals.
Breakfast, lunch and dinner were never tedious affairs because the
school authorities tried hard to serve nutritious meals that blunted the
gloom of being away from home. So good were meal times that, one weekend,
after being served mealie rice, the students were so outraged that they
demanded an explanation from the boarding master for the absence of "proper"
rice. Years later, Muchikichi's accounts of life at boarding school are
almost unbelievable to her daughter, who is in Form One at another boarding
school. Muchikichi holds out a circular sent out by her daughter's school at
the beginning of the third term last week, instructing each student to bring
a packet of rice, sugar, and cooking oil. Worsening shortages of basic
commodities - which followed a prize freeze that was supposed to ease the
plight of consumers, but has only heightened their misery - have hit
boarding schools hard. "I do not know how many parents could have afforded to
send their children with any of these foodstuffs they list here. The goods
were not available in any supermarket. I believe even for those who managed
small quantities, the food will not last the term," Muchikichi
said. Parents now face a tough decision; either to withdraw their children
from the once-fashionable boarding schools and shell out millions in
transport fares to get their children to day schools, or keep the children
in boarding schools where they face starvation. Foodstuffs disappeared
from shop shelves beginning in June when the government ordered a blanket
freeze on the prices of all commodities. When schools re-opened for the third
term, even school uniforms, shoe polish and stationery had
disappeared. The Association of Trust Schools (ATS), representing a number of
private boarding schools, said its assessment was that the food situation
was dire. "We cannot find food. The food situation is precarious," said ATS
chairman Jameson Timba. Many boarding schools have facilities to bake
their own bread, but a wheat shortage means they still cannot feed students.
The baking industry has said the wheat shortage will force it to retrench
more than 10 000 workers. "At my child's school, we were told that there will
be no bread this term and the headmaster even warned us that we should not
be shocked when we are called back to collect our children mid-term," one
parent said. Although Education, Sport and Culture Minister Aeneas Chigwedere
said recently in Parliament that the Grain Marketing Board (GMB) has been
supplying maize meal to boarding schools, his remarks do not tally with
realities on the ground. Many parts of the country have gone for months
without maize-meal, and the World Food Programme (WFP) says up to four
million people could be at risk of starvation by early next year. Last
month, the WFP appealed for US$118 million to buy food for starving
Zimbabweans over the next eight months. The food relief agency already
had 138 000 tonnes of food but needed another 180 000 tonnes to distribute
to about three million Zimbabweans until the next harvest in April. Given
such a scenario, boarding schools are unlikely to be in front of the queue
for mealie meal. This means that school heads who opt to provide bread for
their pupils will have to compete with hordes of other buyers desperately
looking for flour on the black market. Although the official price of
flour is $6 million per tonne, it is only available on the black market at
$15 million, which many schools cannot afford. The headmaster of one
Midlands boarding school said this week that since students returned last
Monday for the new term, he had spent most of his time hunting for goods on
the black market. "I have not held any meetings with staff since we opened. I
am short of everything. I have no teachers, and I have no food," he told The
Financial Gazette by phone.
Byo's critical water shortage to worsen
FinGaz
Charles Rukuni Bureau
Chief City soon to be left with one out of five supply dams BULAWAYO - The
critical shortage of water in Bulawayo is likely to worsen if there are no
rains before the end of October.
The council is now relying on only two
of its five dams but will be decommissioning one of them, Inyankuni, next
month leaving it with only one supply dam, Insiza. The council has
already decommissioned Lower and Upper Ncema as well as Umzingwane
dams. The city of more than one million people is getting only 69 000 cubic
metres of water a day against an unsuppressed demand of 140 000 to 150 000
cubic metres a day. If Inyankuni is deommissioned, the city will
only have 43 000 cubic metres of water a day, less than a third of its
requirements. The only viable solution to the city's water problems is the
linking of Umzingwane Dam to Mtshabezi Dam through a pipeline but the
Zimbabwe National Water Authority (ZINWA), which is supposed to put up
the pipe link has been saying it cannot do so unless the council agrees to a
government takeover of the city's water supplies. The Bulawayo City Council
has vowed to resist the takeover because it will lose 44 percent of its
revenue and also because it does not believe ZINWA has the
capacity. Though ZINWA is using the council's rejection of a takeover as an
excuse, observers believe that the real reason ZINWA cannot install the
pipeline is that it has no money. The water authority has failed to
rehabilitate its boreholes in the Nyamandlovu area while construction of the
Gwayi-Shangani Dam is reported to have stopped. Only eight of the 77
boreholes in Nyamandlovu are operational and supply the city with 298 cubic
metres of water instead of 16 000 cubic metres if all boreholes were on
line. Bulawayo has introduced strict water rationing way beyond what the city
fathers have recommended. According to the latest council minutes
residents are supposed to have water at least four days a week from 1530 to
730 but at times they are going for a week without water. Nkulumane,
Emganwini, Nketa, Pumula, Sizinda, Tshabalala, Bellevue. Newton West,
Southwold and West Summerton should have water on Tuesday and Wednesday, and
on Friday and Saturday. Cowdray Park, Luveve, Magwegwe, Njube, Entumbane,
Emakhandeni, Barbourfields, Mzilikazi, Mpopoma, Nguboyenja, Iminyela,
Pelandaba and Matshobane should have water on Wednesday and Thurday, and
Saturday and Sunday while all eastern suburbs should have water on Monday
and Tuesday, Thursday and Friday. The council has also introduced a ban
on the use of hosepipes and will not only fine anyone found using a hosepipe
but will confiscate the hosepipe.
Econet allowed to test mobile payphones
FinGaz
ECONET,
Zimbabwe's largest cellular telephone network operator has been granted
permission to deploy its mobile payphones in Bulawayo on a trial
basis.
The company said its payphones, which operate under the
Yourfone Yellowman brand, served both as public payphones as well as airtime
distribution points. The benefits to the public were that people could
access the phones and airtime anywhere where there was Econet's network
coverage and this could be at stadiums, bus terminuses, shopping centres and
even at weddings. It said the product had immense opportunities to create
employment through franchising. The Bulawayo City Council said the
project should be given a chance since it had the potential to create jobs.
However, it had to be first carried out on a trial basis to assess whether
any nuisance would rise from its operations. The council also wanted to
assess modalities for licensing vendors who would be deployed at various
centres to operate the payphones.
Elections: history set to repeat itself
FinGaz
Personal Glimpses with
Mavis Makuni
HISTORY seems set to repeat itself when the harmonised
elections are held next year despite South African President Thabo Mbeki's
belief that it will be possible to stage free and fair polls Mbeki, who is
the Southern African Development Community (SADC's) troubleshooter on
Zimbabwe has indicated that a top priority of his mediation mission is to
ensure the combined parliamentary and presidential elections to be held in
March next year will produce a result that no one will dispute.
It is
difficult to see what Mbeki bases his optimism on given that the perennial
complaints of opposition groups about an uneven electoral playing field have
not been addressed. I have a problem with Mbeki's ambivalence. He does not
seem to be sure whether he has a role to play in resolving the Zimbabwean
crisis or whether the matter should be left entirely to Zimbabweans
themselves. However, one assumes that by accepting appointment by SADC
leaders in Dar es Salaam six months ago as their pointman, the South African
leader believed he and the regional bloc had something to offer. But as was
the case about five years ago when his first stint as mediator was shrouded
in secrecy, Mbeki has never spelt out his vision and expectations for the
current initiative. He continues to send out conflicting signals in the same
manner he did when he operated under the discredited cover of "quiet
diplomacy". At the SADC summit held in Lusaka in mid-August Mbeki reported
progress being made in dialogue between ZANU PF and opposition groups, but
did not expound on the nature of the progress. A short while later he was
quoted as insisting that it was up to Zimbabweans to solve their own
problems and that SADC did not wish to take away their right to
self-determination. But the only way the generality of Zimbabweans can
reclaim and exercise their right to self-determination would be through
elections in which they can vote for candidates of their choice without
being intimidated or coerced. The candidates must in turn have equal access
to the media and must be able to campaign freely. But barely six months
before the landmark polls, even these minimum conditions do not exist. The
state media are as partisan as ever and opposition politicians are only
featured in newspaper reports and news broadcasts when they are being
attacked, mocked or generally cast in bad light. Opposition parties must get
police clearance to hold rallies. It has already been announced that as they
did in past elections, war veterans will once again campaign for President
Mugabe and the ruling party. The involvement of the former freedom fighters
in election campaigning has sparked controversy in the past because of
accusations of violence and intimidation levelled against them. They have
been accused of barring opposition politicians from campaigning or holding
rallies in the rural areas by declaring the countryside a no-go zone. It
will be a mammoth task for Mbeki to get genuine assurances that
irregularities such as the abduction of opposition polling agents and the
intimidation of voters right up to polling day will not be repeated next
year. Allegations that the ruling ZANU PF uses food to buy votes persist.
These concerns will be heightened this time around because of the severe
shortages of basic commodities sparked by the government's price war and the
announcement that the state is to introduce Soviet-style "people's
shops". According to the Deputy Minister of Small and Medium Enterprises,
Kenneth Mutiwekuziwa, the establishment of the shops is designed to ease
demand and enable rural dwellers to have easy access to basic commodities.
The conditions under which the people will be able to buy from these shops
are yet to be announced. However there is no doubt that the people will now
be totally dependent on the state for almost everything. Another aspect
of the electoral process that has been mired in controversy in the past is
voter registration. The voters' roll has been described in the past as being
in a shambles with allegations of thousands of "ghost" voters being included
while the names of thousands suspected to be opposition supporters have been
reported missing from the list. Ordinary Zimbabweans will not have found any
comfort in the recent admission by Registrar-General, Tobaiwa Mudede that he
has been subjected to political pressure on issues pertaining to the voting
rights of certain categories of Zimbabweans. In The Financial Gazette
issue of September 6-12, Mudede was quoted as telling the Parliamentary
Portfolio Committee on Defence and Home Affairs that politicians campaigning
to increase their support bases ahead of next year's elections wanted him to
revise his interpretation of citizenship laws. In the past, hundreds of
thousands of Zimbabweans of foreign descent were deprived of the right to
vote when they were declared to be aliens. This was apparently done because
it was feared that these people, most of whom were farm labourers supported
the opposition. This time around however some ruling party politicians
believe they cannot make it without support from this voting bloc. While
Mudede's attempts to strip people of mixed parentage of their Zimbabwean
citizenship was ruled unconstitutional by the High Court, what is of concern
is that such personalised interpretations and applications of the law are
allowed to take place at all. In the circumstances, it is difficult to know
what other aspects can be manipulated behind the scenes to influence the
eventual outcome of an election. Mbeki's focus on the outcome of next year's
elections is meaningless unless he interests himself in some of these
nitty-gritties. mmakuni@fingaz.co.zw
Fringe political parties emerge as polls draw closer
FinGaz
Njabulo
Ncube Political Editor
NOW you see them, now you don't. When newspapers
or newsrooms are inundated with calls from nondescript fellows, brandishing
usually badly written press statements, you do not have to be a soothsayer
to know an election is imminent.
It is four months before voting
begins, and the country's fringe political parties are once again emerging
from hibernation that began after the last elections in 2005. Once again,
editors and journalists must live with the constant harangues of small-time
political players, each desperate to have stories published on their
activities - especially on the front page. There are different varieties of
parties; some come out in the open as elections approach, while others are
born just before ballots are cast. A new party, the Zimbabwe People's Party
(ZPP), has joined a long list of the country's fringe political parties,
announcing its arrival in a series of press advertisements. "Fight
Poverty, join the Zimbabwe People's Party (ZPP) For Genuine Democracy," reads
one of its recent advertisement. Log on to its website, and an impressive
logo pops up, accompanied by a thumbs up sign, encircled with more slogans,
suspiciously Macheso-like: "Zvakanaka Zvakadaro, Kuhle Kunjalo, It's good
like that." The site offers nothing more. But ZPP's splashing of expensive
advertisements has already sent tongues wagging, with the usual suspicion
that the party could be a ploy by the Central Intelligence Organisation
(CIO) to further split the opposition vote. Another new party to emerge
recently is the Patriotic Union of Matabeleland (PUMA), launched in Bulawayo
under the theme "Nothing for Us, Without Us". ZPP and PUMA join a club of
other smaller parties, led by veteran fringe man Paul Siwela, who leads the
ZAPU Federal Party, and Wurayayi Zembe of the Democratic Party. Others in
this class are the United People's Party (UPP), launched in June this year
by Daniel Shumba, the businessman and former ZANU PF chairman for Masvingo
province. Shumba launched his project after becoming disenchanted with ZANU
PF. He was one of six provincial chairmen suspended by the ruling party over
the infamous Tsholotsho Indaba. He later resigned. "The UPP together
with all Zimbabweans will restore the vibrant and diversified economy in a
democratic, law-abiding Zimbabwe. Unite with us, and together we will unite
our nation," the party said in a half page colour advert on the day of its
launch. The UPP symbol shows two hands, joined together, promising to lead
the country "from hopelessness to hope, from poverty to prosperity, from
terror to well-being, from dictatorship to democracy." Siwela, whose
party has participated in parliamentary and presidential elections since
2000, blames the low profile of his party and other small opposition parties
on both the public and private media. "We refuse to be called a fringe
political party or a fly-by-night party. This is nonsensical and a myth
created by the media," Siwela told The Financial Gazette last week. He
said his ZAPU FP - which campaigns for federalism - was in talks with other
"like-minded" groups to forge a united front for 2008, so as to avoid the
"Kenyan Syndrome" - giving the ruling party victory by splitting the
opposition vote. "We are pushing for a broad alliance with other
opposition political players, but at the moment I am not in a position to
disclose their identities," he said. There are more parties. Little known
Zimbabwe Youth in Alliance (ZIYA) has dismally lost all elections since its
formation on September 15, 2003. It has courted controversy with disclosures
that its youthful leader Chawaona Kanoti, a University of Zimbabwe law
graduate, once worked in President Robert Mugabe's Office as an intelligence
operative. In 2005, ZIYA candidates unsuccessfully contested in Chirumhanzu,
Harare and Buhera, while its leader Kanoti was trounced in the
Mabvuku-Tafara senate elections in November 2005. Then enter the United
People's Movement. It has been linked to Tsholotsho independent Member of
Parliament and former government spin-doctor Jonathan Moyo (MP) and former
Zvishavane MP Pearson Mbalekwa. Late last year, it threatened to change
the landscape of opposition politics in Zimbabwe, proclaiming it would "rock
the nation". "Victory is certain", its advertisements proclaimed. Its
symbol was a rugged piece of rock, representing, it explained, the "rock
solid foundations" of the Great Zimbabwe Monuments, the pillars of
Zimbabwe's spiritual home at Njelele in Matopos, the party said. But this
flamboyant marketing has not won the parties much respect. "It is good to
have different voices, but these should be from genuine origins," said
Takura Zhangazha, a political commentator. "Small political parties should be
allowed to exist but we are in a political environment that requires them now
to take a back seat and join forces with a progressive opposition party with
a realistic chance of delivering change," said Zhangazha. Analysts said
the political landscape in Zimbabwe makes it difficult for political parties
to grow and eventually dislodge ZANU PF, a revolutionary party that has
ruled the country since independence from Britain in 1980. They said the
ruling party, whose stiffest challenge came from the Movement for Democratic
Change, which is now in disarray following its split in 2005, uses state
organs such as the police, the CIO and army to fortify its hold on
power. ZANU PF has also made it difficult for smaller parties to access
external funding except for the meager resources provided under the
Political Parties (Finance) Act and has shut out the opposition from the
public media. And because most of the opposition parties remain in the
periphery, ZANU PF has always enjoyed the lion's share of the
budget. "The promulgation of laws such as the Public Order and Security Act,
the Access to Information and Protection of Privacy Act, the Interception of
Communications Act, etc, combine to make it impossible for
smaller parties to thrive," said one analyst. "Some of the faces behind
the smaller parties are also not convincing, which explains why people are
not interested in them. It also appears that some of them are just out to
get donor funding, which is later converted for use by individuals," added
the analyst.
Scandal in the budget
FinGaz
Dumisani Ndlela Business
Editor
It was not a mid-term fiscal policy statement or supplementary
budget meant to inspire the market, and take the economy out of its current
quagmire.
Rather, even for those inside government corridors, it was a
hopeless knee-jerk affair meant to inform the market that government was
still functioning, and that there still was that modicum of courtesy to
present budget estimates before the August house, for approval as required
by law, but nevertheless mislead or conceal details that might create "shock
and awe". And certainly, as remarks from the market indicated last week,
there was a scandal in the budget. Finance Minister, Samuel Mumbengegwi,
indicated that the 2007 budget, which The Financial Gazette has previously
reported as having been spent in March, had suffered greatly from both
economic and fiscal developments that took place during the year. On the
economic front, inflation raced to over 7 600 percent year-on-year in July,
obviously affecting government expenditure which had been planned based on
inflation projections of between 350 and 400 percent by year-end. On the
fiscal front, there was a yawning budget deficit, and this had been largely
financed by increased borrowings from the domestic market, Mumbengegwi
said. Total domestic borrowings to June 2007 amounted to $1.96 trillion,
raising the domestic debt stock to $8.1 trillion, of which $6.1 trillion was
related to interest. That was only as far as he could inform the market,
and mention of the government forcing the printing press to run to finance
profligate government arms was strategically avoided. The Financial
Gazette reported in July that government expenditure had ballooned to well
over $30 trillion in the first six months of the year, well ahead of a $6.5
trillion envelope issued by former Finance Minister Herbert Murerwa to
finance government expenditure in 2007. Increased inflationary pressure had
put the national budget off the rails. The $6.2 trillion had included
provisions for over-spending government agencies. Indeed bids from
government ministries and departments had amounted to $24 trillion for the
year. This represented a 5 313 percent growth over the anticipated
expenditure outturn for the revised budget for 2006. But over $25
trillion could therefore have been spent during the three months to June
2007 alone. While fresh salary and wage hikes bloated expenditure for the
year, these were by no means the only factors pushing costs for the
cash-strapped government. Expenditure for the year suffered from
escalating costs of goods and services, which rose beyond projected
levels. In his budget statement for the year, Murerwa had indicated that the
budget framework was based on an inflation target of 350 percent - 400
percent by December 2007. The salary bill has moved significantly since
the start of the year, way above projected forecasts. The government
increased the civil servants' salaries by about 400 percent in January,
against a budgeted salary increase of 300 percent for the entire
year. This was besides increases in allowances for transport and housing,
which went up by 145 percent and 100 percent respectively. The January
salary increments meant that the government was already way out of its
budget framework days into the budget. Civil servants' salaries were again
adjusted upwards in May by 639 percent. Transport and housing allowances went
up by 524 percent and 110 percent respectively. Already, civil servants
have started demanding salary reviews of 400 percent before year-end. In
his script last week, Mumbengegwi said line ministries, departments and
grant-aided institutions had continued to submit additional financial
expenditure requests in order to meet their operational expenses, cost of
on-going projects to end of 2007, as well as support for agricultural
production. Additional expenditure submissions stood at over $255
trillion, Mumbengegwi said, indicating that these bids were far beyond the
country's domestic financing capacity. Consequently, he had unveiled a
supplementary budget amounting to $37.1 trillion, out of additional revenue
projected to hit $26.4 trillion. This, Mumbengegwi said, was "to maintain
government operations and service delivery for the remaining four months of
the year, and allow for continuation of development projects, where progress
has reached critical stages". In other words, the supplementary budget
was for four months to December 31, 2007; how the government had survived
with a $6.2 trillion budget between January and August is not
explained. But, certainly, a lot of money had been spent during the eight
months to August, and Mumbengegwi has not indicated the source of that money
during the period. Last year, the International Monetary Fund (IMF)
stunned the market after disclosures that the budget deficit for 2005 had
run into a massive $62 trillion, or 60 percent of gross domestic product
(GDP), contrary Murerwa's declaration that the deficit amounted to $3
trillion, or 2.9 percent of GDP. Much of the deficit had been concealed
through government's recourse to the central bank's quasi-fiscal activities,
which later led to a public row between Reserve Bank governor Gideon Gono
and Murerwa over the inflationary effects of the activities. Gono charged
that the central bank had supported government projects after concerted
pleas from Murerwa. Now, apparently, given the chasm between budgetary bids
and what Mumbengegwi offered - $255 trillion against $37.1 trillion - the
question is how will a profligate government not known for miracles last
with just that little?
Another lost opportunity
FinGaz
Comment
YET another
golden opportunity has gone begging. A lot was expected of Finance Minister
Samuel Mumbengegwi's mid-term fiscal policy review on Thursday, what with a
seemingly untenable economic Tsunami reverberating across all sectors of the
economy.
Mumbengegwi was circumspect, unveiling a maiden policy that was
largely thin on detail and lacking the imagination needed to heal the
economy. All there was were all-too-familiar relief measures such as the
relaxation of tax-free thresholds and the widening of tax bands to cheer up
restless workers who will be going through a thorny six months after the
government slammed the brakes on all salary and wage increases to tame
inflation. But even with a bit more cash to spend, workers will still find
themselves stuck with worthless dollars after the blitz on prices left
businesses unable to restock. In order to stimulate exports, the troubled
local unit was devalued from $250 to $30 000 against the greenback, sadly by
that time the parallel rate had raced beyond $270 000. Other notable
highlights in the mid-term fiscal policy review statement included the
expansion of the list of goods attracting duty in foreign currency, the
injection of additional funds into infrastructural development and the usual
rambling about giving a leg up to the crumbling real sector, particularly
agriculture. Admittedly Mumbengegwi, just like his predecessors Herbert
Murerwa and Simba Makoni, had little room to manoeuvre. In as much as he
might have wanted to cut down on recurrent expenditure, which gobbled up the
lion's share of the supplementary budget, Mumbengegwi was cautious not to
stir up discontent ahead of a crucial election in which his party, ZANU PF,
is seeking to extend its stay in power. Mumbengegwi was also under pressure
to make serious provisions for food imports in the wake of exogenous factors
such as the drought, while at the same time pumping additional resources
into capital projects. Revenue has shrunk in line with the contraction in
the economy, a trend which is likely to worsen. And this is against the
backdrop of an inexorable rise in government's insatiable appetite to spend
what it does not have as inflation maintained its upward trajectory. This
has been the trend since the withdrawal of balance of payments support (BoP)
in the late 1990s. That ministries had submitted votes in excess of $255
trillion but were only able to secure $37.1 trillion means that they have to
forego a lot of important things, further compromising service delivery,
which many thought had hit its lowest ebb. With so many service providers
queuing for outstanding payments, the bulk of the $37.1 trillion is likely
to go towards expunging debts. Capital expenditure might have to be deferred
to cover yawning gaps in recurrent expenditure. That aside, the
supplementary budget, 700 percent bigger than what Murerwa had allocated for
the full year, is in itself very inflationary. Interestingly, Murerwa had
budgeted $4.3 trillion, and by June government had collected $3.4 trillion.
Taking into account the knock on effects of the price blitz on the fiscus,
revenue for the remaining months will still remain constrained, barring any
unforeseen circumstances. To keep going in the absence of BoP support,
government would have to borrow more from the domestic market.
Inadvertently, the budget deficit will widen, crowding out private
investment in the process and worsening inflation in the outlook period.
This might explain why the Finance Minister ducked making forecasts on
revenue and inflation, which made the government look stupid in the past
after its predictions went way off the mark. With the central bank expected
to calibrate its delayed mid-term monetary policy review statement along the
lines of the Finance Ministry's mid-term fiscal policy and supplementary
budget, Reserve Bank governor Gideon Gono has his task cut out for him. Gono
has to ensure that domestic debt, whose financing is at the core of the
country's four-digit inflation, does not overshoot the runway, mop up excess
liquidity, which would be worsened by Treasury Bill maturities and the
injection of the $37.1 trillion into the market. All eyes will also be on
Gono to see whether he can re-adjust the exchange rate, which, despite last
week's massive devaluation, remains overvalued. We could not agree more
with Mumbengegwi when he said, "the success of the measures and
supplementary budget I have outlined above will depend on all social
partners subscribing to a common and shared vision, underpinned by the
Zimbabwe First Philosophy espoused under the social contract." We wished
however, he had been more specific and truthful to his colleagues in Cabinet
that they are the biggest culprits. If the powers-that-be think that the use
of the stick on capital and labour would result in those controlling these
factors of production coming to the negotiating table with their tails
between their legs, then they must be dreaming. The heavy-handed treatment
business and labour has been subjected to is turning entrepreneurs and
workers into reluctant criminals. Unless the powers-that-be bite the bullet
and admit they have failed, they might as well forget about securing the
buy-in from business and labour, which is critical for the success of the
social contract. Otherwise resolving the Zimbabwean crisis would be like
trying to solve a crossword puzzle with only half the clues.
FinGaz Letters
Pius Ncube's resignation a most sensible move
EDITOR - The
resignation of Archbishop Pius Ncube was the most sensible thing to do. Only
he knows what happened, and it is a matter between himself and God as to
whether he is telling the truth or not. However, the man is entitled to enjoy
himself and even if his church disapproved of the allleged sex escapades, he
could still defend himself as an individual who is entitled to sexual
gratification because it is an essential need. But he has to follow the
rules and be an example to the public both as an archbishop and as a
politician. It is just totally unacceptable that he can continue to rant
about "regimes" instead of using his office to influence change which,
unfortunately, he has dismally failed to do. It is inconceivable that he
can do so in any other office. The constant claim that he has championed the
cause of the poor is open to debate. The lavish garment that he wears would
be adequate material for a couple of dresses for needy young girls or shirts
for boys, would it not? Showing up the state as the exclusive and only mean
institution is completely misleading. Please, Archbishop, no hatred towards
you at all but start a new life with a good woman (who does not want the
same?) and let the matter rest.
Mordecai Mutiswa Betera United
Kingdom --------- All the people want is water in the
taps
EDITOR - I have seen Water Resources Minister Munacho
Mutezo on a number of occasions defending the handing over of water
treatment and distribution to the Zimbabwe National Water Authority
(ZINWA). Mutezo has gone further to accuse people of politicising this
decision and at some point purported that some individuals might have
sabotaged ZINWA and his ministry when a number of suburbs went without water
for three or four days. Tell you what Minister, nobody cares who is in
charge of water. All the people want is water flowing from their taps,
period. Deliver water to the people and see who will ask which board is in
charge of water. The only reason why the issue raises so much noise is
because people are not getting the service. Put the Ministry of Labour,
the Reserve Bank of Zimbabwe, ZESA Holdings or even the Ministry of Finance
in charge of water and see who among the residents mind for as long as the
service is delivered. Before ZINWA was put in charge, we used to have water
continuously. Rarely would we go without water and whenever that happened,
it never used to be for the whole day. Come on ZINWA, the norm,
specifically in my area of residence (Hatfield) was water today and no water
tomorrow and it continued like that for some time. We adjusted and lived
with that and accepted that level of incompetence. As if that was not enough,
things deteriorated even further in the past couple of weeks. These days, we
are going without water virtually seven days of the week with water coming
for an hour or two on one single day of the week. Such has become the
norm. How are people expected to live under such conditions? There are people
who have to wash napkins on a daily basis and I want to know from the
Minister how he expects such people to cope. I know the Minister has
always wanted to make the point that the equipment is old. True, the
equipment is old. I do agree with him on that. He will, however, have to be
very scientific to convince me that just as ZINWA took over, the equipment's
capacity deteriorated from being able to provide water for the whole week to
providing water for just two hours a week. What I actually believe is that
ZINWA is causing all these burst pipes that we see every day. Imagine sewage
not being taken down the sewage lines, all piling at some point in the line.
Tell me what happens that single day when water is available? Obviously the
lines are blocked and they burst. Surprisingly, the Minister is still holding
firm and abiding by his decision that water and sewer should be in the hands
of ZINWA. He must tell me the people are wrong when they make noise about
this issue. What surprises me even more is the fact that even the majority in
Parliament are against the idea of handing over water treatment and
distribution to ZINWA. The portfolio committee in charge of that concluded
that the decision to hand over this crucial service to ZINWA was not in the
best interest of the residents and the committee got the support of the
House. By whose authority then is Minister Mutezo and ZINWA sticking to this
decision at the expense of the
residents?
Simon Harare ----------- It's up to us as
Zimbabweans
EDITOR - I always read Bornwell Chakaodza's
column in The Financial Gazette and would like to comment on his article of
August 30 2007 titled "Time to hold Zimbabweans to account". First, it
was a well written article which, unlike many other articles out there, does
not merely castigate all and sundry but merely states facts. President Thabo
Mbeki and many others in his cabinet have many times said that Zimbabwe's
problems have to be solved by Zimbabweans. The west may say what they like
about the current leadership but it has little or no effect at all. Short of
economic sanctions or military intervention, there is nothing else they or
anyone else could do. We all agree that this is not the course we would like
to take as it will be the ordinary Zimbabwean on the street that would
suffer the worst. Therefore it is up to us as citizens of Zimbabwe to effect
change. This does not necessarily mean a change of the ruling party. How
this will happen I do not know but it is the only way. Although it would be
a bitter pill to swallow, the solution may lie in an agreement ensuring the
saftey of our President on his departure from office for the betterment of
the Zimbabwean people as a whole.
Trevor
Herbert Harare ---------- We do not need a
Mbeki
EDITOR - If one were to come up with an operational
definition of a dictatorship there is bound to be a clause in it making any
governing body that does not recognise the Universal Declaration of Human
Rights a dictatorship. In passing its laws since 2001 our government has
made it its business to be always in contravention of these and this is a
cause for concern. The cornerstone of these writs is found in the first
three clauses viz: lWhereas recognition of the inherent dignity and of the
equal and inalienable rights of all members of the human family is the
foundation of freedom, justice and peace in the world; lWhereas disregard
and contempt for human rights have resulted in barbarous acts, which have
outraged the conscience of mankind, and the advent of a world in which human
beings shall enjoy freedom of speech and belief and freedom from fear and
want has been proclaimed as the highest aspiration of the common
people; lWhereas it is essential, if man is not to be compelled to have
recourse, as a last resort, to rebel. I must emphasise that "no one shall
be subjected to arbitrary interference with his privacy, family, home or
correspondence, nor to attacks upon his honour and reputation. Everyone has
the right to the protection of the law against such interference or
attacks." We do not need a Thabo Mbeki to solve our problems. After all,
during the apartheid era in South Africa, the efforts of all the other
nations to abitrate amounted to nothing. It was only after the indigenous
people stood up for their rights that they gained independence. Likewise
we should do something to show our disapproval with our lot.
Garikai
Dzoma Harare ----------- Free, fair polls a pipe
dream
EDITOR - It is less than a year to go before the
crucial Presidential elections yet there is a real risk that the elections
will be no more than symbolic. The playing field is not level and is
heavily tilted in favour of ZANU PF. Unjust laws such as the Public Order
and Security Act still exist in our statute books and remain to be abused by
the police in banning rallies by the Movement for Democratic
Change. There is an urgent need to repeal such laws as well as to
depoliticise the police who now appear to be an extention of ZANU PF. Above
all there must be a new constitution that clips the Executive's powers,
which allow it to override and dominate other arms of government,
particularly the judiciary. Zimbabwe has one of the most biased judiciaries
whose support for the ruling party is undeniable. This makes free and fair
elections a pipe dream to be pursued but never
attained.
Kudzayi Harare ---------- Bad boy image doing us no
good
EDITOR - Thank you for a frank paper that lays bare all
the evil amidst us. I just wish you could publish a daily paper. It is a
sad reality that the 2010 World Cup will be taking place in our backyard yet
our chances of benefiting are remote because of the bad boy image of our
government. Instead of trying to mend international relations we are busy
aligning ourselves with rogue regimes like Cuba, Iran and Venezuela. North
Korea has seen the light and is about to reap the benefits of good
international relations. Cdes, it is a phyrric victory we have scored
against the west because we are hurting our own citizens. Those white
commercial farmers are not British but are as Zimbabwean as the people of
Malawian and Zambian origin who are settled here. Racism has no place in
the new world no matter what happened in the past. It is being imprisoned by
the past that will impede our development. I am black and my father fought
against the settler regime. We cannot develop by turning half of our
population into farmers. If you look at developed countries, just about 10
percent of their population are farmers. ZANU PF has destroyed our economy.
They forget that empowerment can also be achieved by giving people shares in
parastatals and industrialising the country and then affording our citizens
the chance to create jobs or getting high paying jobs whose earnings are the
same as from farming. Surely how can you mechanise small pieces of land
unless you import ox-drawn ploughs and hoes? Ever heard of economies of
scale? Please let us rely on people with expertise to run things and help
pull Zimbabwe out the morass.
Tariro Harare
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