RBZ near fuel deal Conrad Dube/Godfrey
Marawanyika SOUTH Africa's Rand Merchant Bank (RMB) is demanding that
Zimbabwe's export receipts to that country be tied up as security for a
long-term fuel deal whose negotiations are at an advanced stage, it was
established this week.
The RBZ confirmed that "negotiations with South
Africa's Rand Merchant Bank have progressed
Officials in the fuel industry yesterday revealed
that the parties were yet to agree on two major sticking points relating to
security of the loan.
They said RMB has said that the facility must
include the settling of previous debts to South African fuel suppliers. The
bank is understood to have demanded that all exports to South Africa be used
to settle the debts including the loan under negotiation.
officials said if all these conditions are met, the fuel situation should
improve in 30 days. The central bank, without revealing much, said talks
were in progress.
"The Reserve Bank of Zimbabwe is in the process of
negotiating a facility with Rand Merchant Bank," the central bank said in
response to written questions from the Zimbabwe Independent.
facility will be activated as soon as the negotiations have been concluded.
Negotiations so far have progressed satisfactorily," the RBZ
RMB spokesperson Peter Gent also confirmed the negotiations
with the RBZ. He would not divulge details regarding the facility, citing
"For reasons of client confidentiality,
RMB cannot comment on specific transactions. Where transactions are of a
politically sensitive nature, RMB will only act as a facilitator on request
from our government which deems such a transaction to be in the national
interest," Gent said in his response to questions.
In pursuit of
the facility, RMB officials held talks with RBZ officials in Harare at the
beginning of the month while RBZ governor Gideon Gono and his delegation
went to South Africa for further discussions.
"We confirm that we
were approached to look into the possibility of helping the Reserve Bank of
Zimbabwe to finance the importation of fuel for that country. No further
details are available at this stage," Gent said.
"Zimbabwe is a major
trading partner of South Africa, and cross-border financing of this kind
takes place on a regular basis in a wide variety of product areas, from
maize to railway equipment," Gent added.
It has since emerged that
the facility is not confined to petroleum products but that the RMB is also
acting as a facilitator on behalf of the South African government on a loan
Zimbabwe has requested from South Africa.
The negotiations have been
going on for almost a month but the critical aspects of the facility have
not been made public. The value of the facility has also not been disclosed
but it is believed to be worth half-a-billion United States
Meanwhile, the fuel crisis reached unprecedented levels as
the country virtually ran dry after foreign currency shortages worsened this
Service stations selling fuel in foreign currency were swamped by
motorists who have access to the scarce resource.
Service Station along Samora Machel Avenue, motorists jostled to get petrol
or diesel. A long queue formed towards Enterprise road as motorists with
free funds bought fuel coupons.
Meanwhile, MDC president Morgan
Tsvangirai will today walk from his Strathaven home to the party's
headquarters in the city centre after failing to access
Tsvangirai said he has tried without success to get fuel from
service stations including those selling in foreign currency.
Killer war vets sentenced to 4 years Loughty
Dube THREE Lupane war veterans accused of kidnapping and assaulting MDC MP,
David Mpala, who later died of injuries sustained during the attack in 2003,
were recently sentenced to four years in jail each.
Seith Themba Jubane, Nicholas Minenhle Ncube and Patrick Ndlovu were part of
a group of six who kidnapped and assaulted the former Lupane MP in
Two other accused, Raymond Gumbo and Boyana Ndlovu, have since
died while Ndaba Mpofu was acquitted of all charges.
magistrate, Sikhumbuzo Nyathi, sentenced the war veteran trio to two years
each in prison for the assault charges and another two years each on the
The three were however not jailed for the third
offence relating to the theft of $15 000 that was in Mpala's vehicle when he
The state prosecutor, Sanders Sibanda, told the court
that war veterans were at a meeting at Lupane business centre when they were
alerted that there was an MDC vehicle around.
The group is
alleged to have seized Mpala and dragged him to a bush behind the business
centre where they assaulted him and stabbed him until he lost consciousness,
leaving him for dead.
Mpala was hospitalised and never fully
recovered and later died of injuries that he sustained during the
It is alleged that after the attack the group drove off with
Mpala's vehicle. Police in Tsholotsho discovered Mpala's vehicle in the
possession of the accused the following day.
Recently Zanu PF
thugs in Mbare and Umguza attacked MDC MPs Edward Mkhosi and Gift
Chimanikire but the perpetrators have not yet been brought to book.
immediate and drastic political and economic reforms, including President
Robert Mugabe leaving power - now and not after two years - could pull
Zimbabwe from the brink, analysts said on Monday.
Reacting to comments by
Mugabe in an interview on Sky News at the weekend that he would step down
"to rest" when his term expires in 2008, the analysts said an earlier
departure by the veteran leader would more than lift crisis-sapped
The perception within the international
community and among an increasing number within Mugabe's own ruling Zanu PF
party was that he had become a stumbling block to Zimbabwe's economic and
political progress, they said.
But more critical, according to Harare
economic consultant John Robertson, was the fact that Zimbabwe could not
wait another two and a half years for Mugabe to step down when his term
ends, before it can embark on extensive and radical reforms to resuscitate
its comatose economy.
Robertson said: "The economy can hardly wait
for that long, we need changes as a matter of urgency. We need to begin to
see a respect for market forces which we no longer have. We must not wait
until 2008 (when Mugabe goes) because the damage will be too great to
Zimbabwe's six-year economic crisis is seen as one of the
highest inflation rates in the world. Annual inflation rose to 265,1 % in
August compared to 254,8 % in July, according to official figures released
this week. The country's limping economy has been worsened by foreign
currency, fuel and food shortages. Foreign currency shortages have hamstrung
industry, plunging production levels to below 30%.
repression by Mugabe and his controversial economic and land policies,
chiefly his expropriation of white-owned farms to resettle landless blacks,
for exacerbating Zimbabwe's crisis. The veteran leader denies responsibility
for the economic meltdown, instead he says Britain and its Western allies
have ganged up to sabotage Zimbabwe's economy in a bid to incite an uprising
against him in retaliation for the land seizures.
Whatever the reasons
behind Zimbabwe's deepening crisis, the analysts said only the departure of
Mugabe, who has ruled the country since Independence in 1980, could restore
much needed confidence in the southern African country.This, if only because
modern politics dictated that leadership renewal was crucial in a country's
development, according to University of Zimbabwe lecturer and political
commentator Heneri Dzinotyiwei.
"It is always better with a new
leadership," Dzinotyiwei said. Asked whether Mugabe's departure will herald
a new beginning for the troubled southern African country, Dzinotyiwei
responded: "There is no question about that. The government is the problem.
Out of the government, the cabinet, the parliament, the only thing that has
not changed since Independence in 1980 is Mugabe, so people are beginning to
associate the country's (problems) with Mugabe."
reviled by multitudes in Africa and banned from most Western capitals for
alleged human rights abuses, Mugabe has in the past insisted his Zanu PF
party will decide when he should leave office. But analysts are agreed that
the culture of fear within Zanu PF precludes anyone within the party from
stepping forward to tell Mugabe to go.And when Mugabe eventually goes at a
time of his choosing, putting the country back on track would take years as
Zimbabwe has lost millions of skilled workers to neighbouring countries and
abroad while there are few resources available for
More than three million Zimbabweans out of the
country's total 12 million people live in neighbouring countries or further
abroad after fleeing home because of hunger or political
Dzinotyiwei said: "Zimbabwe is one of the biggest
countries in Africa in terms of resources and it has patriotic citizens but
exactly that strength is what we are losing as more people leave the country
in frustration." - zwnews.
Mandaza fires board Dumisani Muleya AS the crisis
triggered by the mediagate scandal at the Zimbabwe Mirror Newspapers Group
deepens, the publishing concern's CEO and editor-in-chief Ibbo Mandaza has
fired the company's board of directors in a bid to retain control of the
Sources said Mandaza has dismissed nearly all directors, save
for three loyalists, creating an explosive situation at the beleaguered
Mandaza two weeks ago dismissed his deputy, Alexander
Kanengoni, after he failed to appear for a disciplinary
Kanengoni had been suspended for alleged acts of
insubordination and misconduct. Sources said Mandaza was scrambling to gag
this paper on mediagate by trying to rope in the Media and Information
Commission to act as a "censorship board".
Independent has reported that the Mirror titles, the Daily Mirror and Sunday
Mirror, and the Financial Gazette have been taken over by the Central
Intelligence Organisation (CIO) using public funds.
This was part of
a covert propaganda blitz by the state security agency which also runs news
websites and is eyeing other publictions as well.
Sources said the CIO
also had a presence in other communication agencies, including newsrooms of
the state-controlled media. It has been learnt that a major production house
could be operating under the direction of the CIO.
Mandaza dismissed most members of the Mirror board led by Jonathan Kadzura.
Among those fired are the directors who represented CIO interests at the
Mirror, Thomas James Meke, Charm Ndaba Mukuwane, John Marangwanda, and
Meke is the immediate past CIO administration and finance
director and Mukuwane, now managing director and majority shareholder of
Creative Solutions (Pvt) Ltd, is one of his
Marangwanda - affectionately known by his CIO
colleagues as "Jofo" - was head of the economic desk. He was once posted to
Botswana as a liaison officer before he returned home and later retired.
Sources said he was key in brokering the CIO newspaper deal through a shelf
company called Unique Investments (Pvt) Ltd.
Ambassador Buzwani Mothobi, now acting chair, Joyce Kazembe and Amy Tsanga,
remain on the Mirror board. Tsanga replaced Tendai Mangezi who resigned.
Musi Khumalo also resigned.
Kadzura declined to comment, saying he
would issue a "comprehensive statement" on the matter.
issue a comprehensive statement on the issue in due course. I will advise
you on when the statement will be issued. I will invite you when I do that,"
Asked for an exclusive interview on the unfolding CIO media
ownership saga at the Mirror group, Kadzura said: "I will talk to you when I
issue the statement."
Sources said the dismissal of the Mirror
board would worsen the situation.
The sources said the CIO was giving
Mandaza a long rope to hang himself by allowing him to act against their
interests as major shareholders.
It was said Mandaza had mustered
enough courage to confront the CIO head-on after he secured the backing of
members of the dominant faction of the ruling Zanu PF led by retired army
commander, Solomon Mujuru.
Sources said Mandaza ensured the Mirror
titles backed Vice-President Joice Mujuru in the run-up to the Zanu PF
congress last December in her bid to secure her current
Although the Independent was the first to break the story
of the Mujuru vice-presidency bid last year, the Mirror papers gave
extensive coverage to the story.
Mandaza was said to have
approached a local bank looking for money to retain control of the papers
and ensure a massive mediagate cover-up but sources said this came too late.
The CIO was said to be angered by this.
Sources said the CIO was
carefully watching the events as they unfold while it plans how to regain
control of the papers. It was said to be tightening the noose around Mandaza
through an audit of the finances of the Mirror. There were allegations of
abuse of funds at the group. The Mirror reportedly obtained $38 billion from
the central bank's productive sector facility although some of the money
came from the CIO who at one time paid 83% of the papers' operating
The Mirror papers have a weak economic base, poor
advertising and low circulation. It was said they were surviving through the
backing of their major shareholder "who has deep pockets and staying
Sources said a forensic audit report by Ernst & Young was
out. It was handed over to Kadzura, as board chair. It is understood on
Wednesday Mandaza convened what he termed a board meeting although minus the
representatives of the major shareholder.
Sources said only
Mothobi, Tsanga and Mandaza himself attended the meeting. It was said
Mandaza tried to have the audit report handed over to Mothobi but Ernst
& Young flatly refused, saying they would only hand it over to the
principal who commissioned the audit.
Sources said the audit has
"interesting details" on the Mirror's finances. The CIO was due to convene a
meeting to deal with the crisis. This has set the stage for an explosive
showdown at the Mirror
PRESIDENT Robert Mugabe's announcement that he will only retire in
2008 when his term of office expires spells disaster for Zimbabwe since the
country needs an able leadership as a matter of urgency, the opposition MDC
President Mugabe, in power for a quarter of a century, told
reporters in Havana where he was on a state visit that he needed to rest and
would cede power in 2008. But the opposition said 2008 was a long
"The country is bleeding and as long as Mugabe continues in
power for a single day it's a disaster for Zimbabweans," said Paul Themba
Nyathi, the MDC spokesperson. "We have said before that as long as there is
a country left to destroy, Mugabe will not leave power."
said Mugabe's policies have brought suffering to Zimbabweans and for Mugabe
to stay in power for even three months was a catastrophe.
single day Mugabe continues in power regresses the country to the sixteenth
century and Zimbabweans should brace themselves for more hardships as Mugabe
has made it known that he is still around for the coming three years,"
Mugabe has in the past scoffed at suggestions for him to
step down, arguing that he has a mandate from the electorate to lead the
Meanwhile the MDC national executive committee will meet today
to decide on whether to participate in the Senate
Nyathi confirmed that the meeting was taking place today at
the party headquarters in Harare.
Questioned on MDC leader Morgan
Tsvangirai's statements that the MDC would not participate in the Senate
polls, Nyathi said Tsvangirai was contributing to public discourse on a
matter of public concern.
"The MDC leader is a Zimbabwean and he was
contributing to debate on the matter but the issue will be resolved when the
national executive makes a decision today," Nyathi said. - Staff Writer.
fares need to be raised immediately if operators are to break even in the
light of critical fuel shortages that have compelled operators to source
petrol and diesel from the black market.
Operators say they need to
charge commuters double the current $15 000 for a 25 km trip to Mabvuku
high-density suburb to remain viable.
In submissions made to the
Local Government ministry, they say they are foregoing essential repairs and
servicing of their vehicles to cut costs but that this endangers the lives
of commuters. Operators are being forced to use unroadworthy
Those operators who run 18-seater omnibuses risk incurring
losses of up to $3,2 million a day if fares remain at current levels when
they have to source fuel from the black market at $80 000 a
It costs $2,7 million per day to run a commuter omnibus at
official pump prices of $20 300 a litre with a calculated loss of $407 000
per day at government-stipulated fares. The costs soar to $5,6 million with
the operator incurring a $3,2 million daily loss when he buys fuel at black
These calculations are based on quotations
obtained from insurance companies, the city council, the Ministry of
Transport and vehicle repair companies.
Other daily costs include
oils, car washes, tickets and lunches for the driver and his
The costs assume that fuel is readily available. Any
continued fuel shortages would result in huge losses for the operators as
some operational costs such as vehicle insurance and presumptive tax, route
permit fees and vehicle licences remain fixed.
fares have worsened the plight of workers whose salaries have remained
stagnant despite recent fuel price hikes.
Commuter omnibus operators
say government must reach a compromise with them soon to avert a serious
transport crisis that has the potential to disrupt industry and commerce and
grind it to a halt as workers fail to go to work.
Fuel shortages have
become so acute that Harare town clerk Nomutsa Chideya on Tuesday admitted
his council had been compelled to procure fuel from the black market to
"We have not received diesel for the past four
weeks. For the sake of the health of the residents, we would rather buy the
fuel on the parallel market." Chideya told a parliamentary committee on
Harare City Council used to receive a fuel
allocation of 30 000 litres a month from the National Oil Company of
Zimbabwe, but this had been drastically reduced to about 10 000 litres a
month. - Staff Writer.
Harare/Byo water woes get worse Grace Kombora/Susan
Mateko HARARE will continue to experience water problems so long as the
Zimbabwe National Water Authority (Zinwa), which is managing water
purification, does not have the capacity to do so.
chairman Willie Muringani this week told the Zimbabwe Independent that the
parastatal was facing numerous challenges as it does not have enough
resources to improve water purification.
Zinwa four months ago took
over bulk water treatment in Harare from the city council saying the local
authority was failing to provide water to ratepayers. However, the capital
has for the past three months faced its worst ever water supply problems
with the city's northern and eastern suburbs going without water for over
"The takeover has presented numerous challenges to Zinwa
such as infrastructure that has outlived its economic life, inadequate
resources to maintain and repair the existing infrastructure and
unavailability of foreign currency to import the required equipment and
chemicals," Muringani said.
A source at Zinwa said financing of
the repair works, which Reserve Bank governor Gideon Gono promised when
Zinwa took over from the Harare city council, was not
Muringani said they were trying to correct the anomalies
inherent in the old system in order to alleviate water
"What is actually happening is that we are trying to
correct anomalies that were inherent in the old system where some parts of
the city almost always bore the brunt of water cuts," he said.
attributed the persistent water cuts to the increase in demand by Harare
residents. "The persistent water cuts are being caused by demand which has
outstripped supply in Harare," Muringani said.
The shortages have
forced residents to draw water from unprotected wells and Mukuvisi
Meanwhile Zinwa has intro-duced demand management, which
entails the cutting of water supplies to most residential suburbs for the
"The water demand management entails cutting of water
supplies for 24 hours to the southern and northern suburbs. However, we are
not in a position to say when the demand management will end," Muringani
Under the plan, water pressure to southern suburbs and to
Chitungwiza is reduced at certain periods to allow for greater distribution
to other suburbs.
"Water supply mains to the high-density areas
of Highfield, Sunningdale, Dzivarasekwa, Kuwadzana, Warren Park and
Chitungwiza will be throttled to control flows into those areas," said
Zinwa in May this year took over bulk water supply for the
Harare Metropolitan area. This covers the city of Harare, Chitungwiza, Ruwa
Muringani said the solution to persistent water
problems lay in the complete rehabilitation of waterworks and the
construction of Kunzvi dam.
"The long-term solution to Harare's water
problems lies in the complete rehabilitation of the city's major treatment
works, Morton Jaffrey and Prince Edward, which have the capacity to produce
a combined estimate of 600 megalitres per day and the construction of Kunzvi
dam," he said.
Muringani said Kunzvi Dam was expected to be completed
in the next three years.
The dam, to be built on the confluence
of Nyaguwe and Nora rivers in the Goromonzi district, falls in a different
catchment area to Chivero, Manyame, Seke and Harava dams that get their
water from Manyame River.
Muringani said: "Construction of Kunzvi Dam
is expected to be complete within the next three years."
Resources minister Munacho Mutezo in April said government would announce
the funding for the construction of the dam "in the next three weeks". To
date no such announcement has been made nor has there been any tendering
process for the project.
Meanwhile our Bulawayo bureau reports that a
catastrophe is in the making in the city unless there are good rains this
Bulawayo has been hit by serious water shortages that have
seen some suburbs going for two months without water.
Two dams in
the city have completely dried up while the remaining two dams have no
The city's director of engineering services Peter
Sibanda on Wednesday revealed that short of good rains, the remaining supply
dams, Inyakuni and Insiza, would dry up.
"The situation is really
bad. If there are no rains this season we are set for a disaster as the
current water supply dams are running low and very soon they will dry up, if
there are no huge inflows," Sibanda said.
He said current supplies
were only enough to last 12 months and thereafter there would be shortages
if there were no inflows into the city's dams.
"So far the water in
the dams is not enough and will only last for about 12 months because of the
water rationing measures we have put in place," Sibanda
Sibanda said council was trying to resuscitate boreholes at the
Nyamandlovu aquifer in Matabeleland North.
He however reiterated
that this would not meet demand as it only accounted for a 10th of the
city's daily requirements.
"Council has embarked on a programme to
resuscitate boreholes at the Nyamandlovu aquifer. However this will not meet
the demand as it will only provide a 10th of what is needed," said
The two remaining dams are currently supplying the city with
only half of requirements.
Inyakuni supplies 24 million cubic
metres out of a capacity of 80 million cubic metres while Insiza supplies 83
million cubic metres out of a capacity of 173 million cubic metres.
Air Zim flies three passengers Roadwin
Chirara PROBLEMS at Air Zimbabwe continue to mount after revelations that the
airline managed to fly only three passengers on its Bangkok-Dubai route on
Friday, September 2.
On the same day the airline cancelled its
flights to Bangkok from Beijing after it had been notified that there were
no passengers from the Chinese capital to Thailand.
airline flew the three passengers in Bangkok to Dubai on its leased
245-seater plane. On arrival in Dubai the airline managed to pick up 80
passengers from the Emirate city for the trip to Harare.
recently added to the airline's Asian destinations after earlier efforts to
launch the route failed due to lack of passengers to the Thai
The Independent heard that the three passengers on the
flight from Bangkok were over-weight on their luggage allowance and Air
Zimbabwe wanted them to pay extra for the surplus.
"That was not
all," said one of the passengers on the flight. "We thought because there
were only three of us on the plane, there would be free seating in business.
But we were told to go to the economy class."
After protesting, the
passengers were eventually allowed to take business class
The airline's problems have been worsened by its leasing of a
Boeing 767-200 from PB Air of Thailand at a total cost in excess of US$2
million for the duration of the three-month deal.
Air Zimbabwe is
also said to have committed itself to servicing the Bangkok route during
negotiations for the plane with the Thailand company in return for the
company charging below market rates for the lease of the plane.
Zimbabwe spokesperson David Mwenga could not comment on the issue saying he
did not have the figures and information on the flight.
"I am sorry I
cannot comment without having the information on the date in question,"
The airline is currently being charged US$3 200 per
flight hour compared to the Iata rate of US$8 000 for planes in the
The airline will also be subjected to insurance
costs which are pegged in US dollars over the duration of the lease
Currently Air Zimbabwe is charging $25 million for a
return ticket to Beijing, $12 million for a return ticket to Dubai while
Bangkok travellers will be expected to fork out $28,4 million for a return
Industry operating at 25% of capacity Shakeman
Mugari ZIMBABWEAN industry's capacity utilisation has slumped to an all-time
low with information this week that most companies are operating at a
quarter of their capacity.
The Zimbabwe National Chamber of Commerce
(ZNCC) said although it is yet to conclude a comprehensive study on the
state of industry, preliminary research indicates that most companies are
now operating at 25% of capacity.
This is arguably the lowest level
since Independence in 1980. Political uncertainty and lack of investor
confidence have been blamed for the parlous state of Zimbabwe's economy.
Foreign currency, fuel, power and water shortages have precipitated the
rapid plunge in industrial capacity utilisation.
Luxon Zembe confirmed that initial feedback from its 2 500 members showed
that industry was operating at about a quarter of capacity.
worst in 2003, industry operated at about 35%, but the new levels show that
contrary to government claims that things are getting better, the economy is
"Things are really bad in industry," Zembe
"A number of our members have closed down," he said. "Fuel,
water and power are in short supply. But the biggest cause of the problem is
the foreign currency shortage."
Most ZNCC members have not
received foreign currency from the Reserve Bank of Zimbabwe's auction market
in the past five months. They have not been able to buy crucial raw
materials to operate.
Zembe warned that things could still get
"The economy is in the intensive care unit and there is need
for a major policy shift if things are to get better," he said. He blasted
what he called "discord, incoherence and distortions" in government
"The economy is bleeding because there is no policy
consistency. The government and monetary authorities are pulling in
The recent attack on the International Monetary
Fund (IMF) by President Robert Mugabe in Cuba soon after Zimbabwe was
reprieved from expulsion shows policy contradictions.
is working on a special report which will feed into a comprehensive document
to be submitted to the RBZ for consideration before the next monetary policy
review. At the core of the ZNCC's concerns to be raised in that submission
would be the apparent policy confusion in the government, lack of political
will and misplaced priorities, Zembe said.
He said members of the
chamber were also concerned with the government's extravagance. The members,
he said, were worried that the government is splashing money on galas and
air shows at a time the economy is burning.
The Air Force of Zimbabwe
last week held air shows which used a lot of fuel which industry thought
should have been put to better use.
Government has also spent
millions of dollars on galas - something which according to Zembe, the
country cannot afford in this crisis.
"Our priorities are just
skewed. We are so obsessed with petty issues that do not add value to the
economy," Zembe said.
International Monetary Fund (IMF) executive board says the policy measures
introduced by Reserve Bank of Zimbabwe governor Gideon Gono are not enough
to turn around the economy.
The fund also warned that unless strong
macroeconomic policies are undertaken urgently, the country's social and
economic conditions could deteriorate further.
In a statement
released last week after the IMF executive board gave Zimbabwe a six-month
reprieve, the fund said although Zimbabwe had made positive moves, there was
need for comprehensive policies to address the crisis.
executive board notes that Zimbabwe has taken positive steps in the area of
the exchange rate and monetary policies since the last review, but concludes
that these fell well short of what is needed to address Zimbabwe's economic
"The executive board warns that there is a significant
risk that unless strong macroeconomic policies are undertaken without delay,
economic and social conditions could deteriorate further," reads the IMF
board report numbered 5/205.
There is speculation that Harare has
over the past month been trying to show that it is addressing the IMF's
recommendations to devalue the dollar by allowing it to slide on the auction
Previous IMF missions to Zimbabwe have recommended
devaluation to boost exports to generate more foreign
The dollar this week depreciated to $26 000 against the US
dollar, up from $10 000 in the past two months but fetches nearly double on
the black market.
Finance minister Herbert Murerwa this week
however flatly denied allegations that the exchange rate movement was part
of the IMF's conditions.
"That is not true at all, it is not part of
the deal," Murerwa said.
The executive board also urged Zimbabwe to
implement a comprehensive adjustment programme as a matter of urgency in the
areas of fiscal, monetary, and exchange rate policies and structural
Zimbabwe recently made US$131 million loan repayments to the
IMF to delay its expulsion.
* Meanwhile, the IMF has denied
reports that Zimbabwe was last week forced to make a further US$50 million
payment to avoid expulsion.
An IMF official told businessdigest on
Wednesday that Zimbabwe "had not paid the US$50 million as previously
He said their accounts showed that Zimbabwe had paid only
US$120 million. "As far as we know, we only received US$120 million from
Zimbabwe and that is final," the official said.
Zimbabwe has been
in continuous arrears to the IMF since 2001.
As of last week, Zimbabwe's
arrears to the IMF amounted to SDR119 million (about US$175 million), or
about 34% of its quota in the IMF, down from US$295 million.
the current debt, SDR37 million (about US$54 million) is owed to the General
Resources Account and SDR82 million (about US$121 million) to the Poverty
Reduction Growth Facility Trust.
Compulsory withdrawal is the last
step in a series of escalating measures that the IMF applies to members that
fail to meet their obligations under the Articles of Agreement. - Staff
Liquidation of Hippo FCA will worsen sugar shortage -
Gomwe Eric Chiriga HIPPO Valley Estates (Hippo), one of the country's two
major sugarcane producers, says the decision by the Reserve Bank of Zimbabwe
to liquidate US$2,68 million from its foreign currency account (FCA) will
worsen the current shortage of sugar.
The RBZ last week directed that
US$2,68 million be liquidated from the company's FCA on grounds that its
banker had violated exchange control regulations with respect to the
liquidation of FCA balances within the 30 days stipulated by the Reserve
"This development will adversely impact on the company's
ability to import critical inputs and thus seriously undermine production,"
Godfrey Gomwe, the chairman of Hippo, said.
Hippo has denied
violating exchange regulations and has since appealed to the RBZ to reverse
the liquidation. Hippo is arguing that the funds were approved by the
exchange control authorities and were within the stipulated retention
Gomwe said the monitored domestic sugar prices, which are
grossly unviable and uncompetitive when compared to the regional markets,
were the major cause of the current sugar shortage as it created room for
"The economic improvements recorded
during the greater part of 2004 and early 2005 in response to the RBZ
monetary policy interventions have started to reverse," Gomwe
On the problems with their seized land, Gomwe said parts of
Hippo Estates remained listed for compulsory acquisition under Section 5
despite objections lodged with the relevant authorities.
annual report for 2004, Gomwe said the company achieved an overall cane
yield of 86,45 tonnes per hectare - a drop of 18,7% from the prior year's
average yield of 106,28 tonnes.
Previous gains under threat - Agribank Eric
Chiriga THE loss of business confidence will result in reversal of the gains
made in the last financial year, unless controlled, the Agricultural
Development Bank of Zimbabwe (Agribank) has said.
the acting chairman of Agribank, said the reporting period has seen a
decline in business confidence which, if not checked, may reverse gains made
in the 2004 financial period.
Both local and foreign investors have
lost confidence in Zimbabwe's economy, saying it is highly
Currently, the country is not getting any significant
Foreign Direct Investment (FDI).
Makonyere said last year
business witnessed appreciable moves towards macroeconomic stability, but
things are turning negative again.
"While a steady decline in
year-on-year inflation was registered in the period from 623% in January
last year to 124% in March this year, a reversal of the trend has been
recorded since then," Makonyere said.
From April to June, inflation
rates of 129%, 144% and 164% were recorded and the rate recently increased
In the belief that inflation was sustainable on a downward
trend, the Reserve Bank of Zimbabwe (RBZ) governor, Gideon Gono, reduced
overnight accommodation rates from 189-199% in July 2004 and 110-120% in
December 2004 for secured and unsecured borrowing
These rates were projected to decline steadily to
between 70 and 80% by June this year.
However, due to reversal in
the inflation trends, rates were raised from 160-170% in May and
subsequently from 190-200% in July.
Makonyere said the principal
source of the inflation remains foreign exchange shortages and its
consequent effects on the supply side of the economy.
last year the limited supply of foreign currency led to a depreciation of
the Zimbabwe dollar by 595%.
The dollar depreciated by a further 200%
at the beginning of this year as the central bank endeavoured to maintain
In a bid to solve the chronic foreign
currency shortage, the RBZ introduced the foreign currency auction which
unfortunately can only allot a maximum of about US$50 million per
In their results for the half-year ended June 30, Agribank
recorded a pre-tax profit of $14,9 billion.
However, the bank had
bad and doubtful debts of $94,1 billion, which Makonyere said were due to
the incidence of crop failure caused by the severe drought of 2004/5
cropping season and wilful default in some cases.
adequacy ratio is 6% which falls short by 4% to the RBZ minimum prudential
ratio of 10%.
"This has arisen as a result of a reclassification of
government's loans amounting to $954 billion whose terms and conditions were
not clarified at the time of disbursement."
The loans had been
treated as grants from government.
Fires cost Border dearly Roadwin Chirara BORDER
Timbers has lost a total of 4 000 hectares of timber to arson since 2002, a
development that has negatively impacted on the availability of matured
timbers on its plantations.
The situation has resulted in the company
resorting to the importation of matured timber to meet market
In the period under review ending June 30, Border Timbers
said it had been subject to a total of 75 fires of which 93% were
The company said its investment in fire-fighting equipment had
significantly reduced the severity of the fires on its
Border Timbers had previously made a provision of over
$3 billion towards the acquisition of fire-fighting equipment in the
previous financial year.
"The fires are continuing into the new
financial year, the acquisition of state-of-the-art fire trucks, rapid
response strike units and specialised small tools has significantly enhanced
fire-fighting capabilities in the group and has prevented a potential
catastrophe in the plantations," the company said.
It added that
it had projected to meet its planting target in the coming financial year as
the dry weather had affected its previously set targets.
thinning to waste operations achieved the targets of the year. However, the
planting programme was not met because of the dry weather conditions
experienced in Chimanimani," said the company.
Border Timbers said
continued erratic power suppliers had affected the production at most of its
mills which in turn impacted on market supply.
"All three mills
operated under outrageous erratic power supply, specifically in the latter
part of the year. This impact was most pronounced at Charter and Tilbury
sawmills," the company said.
Border Timbers International operations
were affected by the pricing pressure arising from the increased competition
from Chinese exports to its United States market.
have entered the USA market and are putting pressures on prices. In the last
quarter of the financial year, a new product was successfully marketed in
the United Kingdom and orders are set to improve if deliveries meet the
customers' expectations," said the company.
"Prices for this
particular market in the UK are generally better than those achieved in the
USA," the company said.
BEWILDERING signals of Zimbabwe's relations with the International
Monetary Fund (IMF) have again emerged from government with the usual
sabre-rattling from President Mugabe and more mellow comments from the
Ministry of Finance and the central bank.
Mugabe, who recently
authorised the payment of US$120 million towards the IMF's US$295 million
debt, saw it fit last weekend to attack the international banking
institution on his arrival in Cuba. While in the warm embrace of the
communist state which has promised Zimbabwe assistance in health and
education, he sang the Fidel Castro refrain that the IMF was not of any help
to poor countries.
It should be remembered that Cuba withdrew from
membership of the fund in April 1964. The move was the culmination of a
period of difficulties in Cuba's balance of payments starting in 1959.
Castro has since then not missed an opportunity to take potshots at the IMF
and to rally other Third World countries to break ranks with the "ruinous
He has called it the "executioner which pulls the string so
that the guillotine's blade falls on the heads of Third World
To blend in with his surroundings, Mugabe did not
"We have never been friends of the IMF and we shall never be
friends of the IMF," Mugabe warbled on arrival in Cuba on Saturday. "The IMF
is never of real assistance to developing countries. It is wielded by the
big powers. It is the big powers which dictate what it should
But his Finance minister Herbert Murerwa and central bank governor
Gideon Gono were meanwhile working feverishly to ensure that Zimbabwe is not
expelled from the fund. Gono justified the payment of US$120 million saying
it was " important as a matter of national pride, dignity, security and
survival to sacrifice present comforts in fulfilment of wider global
Murerwa also expressed optimism after the decision to
spare Zimbabwe from expulsion.
"I am happy Zimbabwe has been given
another lifeline," he said. "We will look at ways in the next few months to
cut down on more of our debts and patch up our relationship with the
While Mugabe believes that Zimbabwe "shall never be friends" with
the IMF, his Finance minister sees hope in maintaining cordial relations
with the fund. He has also spoken out against price controls which Mugabe is
known to favour.
While Gono pleaded with the IMF not to "take
precipitous actions (to expel Zimbabwe) whose effect is to blunt or negate
the turnaround efforts currently underway ", Mugabe sees the IMF as a
hostile construct of the capitalist order.
Put simply, the IMF is a
key facet of Gono's so-called turnaround programme but features very
differently in President Mugabe's Fidelist mindset. He already has many
converts in the higher echelons of the party who subscribe to his
belligerent views on the World Bank and the IMF.
Therein lies the tragedy
of Zimbabwe's quest for economic recovery. Policy contradictions in the
handling of the economy within the Zanu PF government have ensured nothing
tangible is achieved. Murerwa and Gono seem condemned to the same fate as
Makoni, Chambati and Chidzero.
Not that much will be achieved anyway by
the payment of the US$120 million to the IMF as Zimbabwe can still not
access any balance of payments support as it is still
Murerwa and Gono's run-around to normalise relations with the
IMF will turn out to be a waste of time as long as Mugabe continues to
second-guess his ministers and confuse the country on real government policy
with regards to relations with the Bretton Woods twins.
obscurantist mode that has become so predictable has seen the country
failing to implement its own economic policies, from the Economic Structural
Adjustment Programme (Esap I and II), Zimprest, the Millennium Budget, the
Millennium Economic Recovery Programme, the National Economic Recovery
Programme (Nerp), and the National Economic Revival Programme (Nerp) to the
expansively titled Towards Sustained Economic Growth - Macro-economic
There is a long history of half-heartedness by
Mugabe's government in drawing up and executing turnaround programmes. It
gets worse when the presidential coach and horses drives through fragile
Business leaders at the Confederation of Zimbabwe Industries
congress last week heard of the co-operation and consultation between
Business Unit South Africa and President Thabo Mbeki's government on
economic issues. That remains a pipe-dream here where government thinks
co-operation with social partners and the international community is a
global conspiracy to evict the incumbent.
If President Mugabe is
serious about turning this economy around, he must lead the charge to
demonstrate willingness to adopt a cooperative approach to international
ZABG a reflection of RBZ's failure Shakeman Mugari
THE Supreme Court ruling last week that the Zimbabwe Allied
Banking Group (ZABG) was using illegally acquired assets from collapsed
banks mirrors the failure of government's economic recovery
The ruling said the sale and transfer of Trust and Royal
banks' assets to the ZABG earlier this year was unlawful "null and void, and
of no force or effect".
In his judgement, Justice Wilson Sandura also
said there was disregard of the law in the manner the Reserve Bank of
Zimbabwe (RBZ) approved the takeover of the assets. He said the central bank
had sidestepped the Troubled Financial Institutions (Resolution) Act, which
was rushed through parliament last year to justify the takeover of the
The judgement means the ZABG is insolvent in the likely
event that the assets are returned to their legitimate owners, Trust and
Analysts say the problems at the ZABG are a sign of how Reserve
Bank governor Gideon Gono and his government principals have failed to
resuscitate the economy. The ZABG was the flagship of Gono's economic
turnaround strategy. Its imminent collapse should therefore be viewed in the
broader scope of an economy on the slide, analysts say.
buffeting the bank include rising inflation, which this week surged by 10,3
percentage points to 265,1% from 254,8% last month. This trend, analysts
say, will continue despite Gono's assurances that inflation will soon
stabilise. They say inflation should gallop to more than 500% before
year-end. The Central Statistical Office (CSO) this week warned that
inflation was likely to rise this month when the recent fuel price increases
are factored in. It said the 265% only reflected price movements up to
mid-August when the figures were collected. "We should note that this
(265,1%) applies to prices up to mid-August when the data was collected,"
the CSO said. "The recent fuel price increase has not been factored into the
inflation rate. Also there are some services and commodities that were
subjected to VAT, like postal services. Obviously that will come into effect
It warned: "Historically, the tendency has been that
business people want to take advantage of fuel price increases. For instance
even though fuel costs might only constitute 20% of the cost, businesses
normally want to effect a 100% increase on their services and
Therefore contrary to Gono's predictions that inflation will
start decelerating in September there are strong signs that it should
increase drastically on the back of fuel price hikes and a weakening
Perhaps the crux of Zimbabwe's problem is the lack of
political will to deal with the economic crisis decisively. The government's
policy confusion and arbitrary actions are probably the biggest threat to
Gono's economic turnaround. Soon after the International Monetary Fund (IMF)
gave Zimbabwe a six-month reprieve to deal with its problems or risk
expulsion, President Robert Mugabe went on the offensive, attacking the fund
in Cuba. "We have never been friends of the IMF and in the future we will
never be friends of the IMF," Mugabe said. He called the IMF an organisation
that is "willed by the big powers which dictate what it should
His attack cast doubt upon Zimbabwe's commitment to implement some
of the key measures that the fund has been proposing for the past five
years. The IMF has on more than five occasions advised Harare to cut its
budget deficit, abolish the dual exchange rate and stop interfering with the
market. The fund has also advised against the dual interest rates, which it
said created distortions in the market. But the government and the Reserve
Bank have maintained a dead man's grip on the market and the exchange rate.
They have continued with price controls and maintained the monopoly in grain
trading through the Grain Marketing Board (GMB), a practice that runs
parallel to the IMF's advice.
Policy and price distortions abound in
the Zimbabwean economy. Fuel, for instance is sold at three different
prices. Government ministries and departments buy at $11 000 a litre for
diesel and $13 500 a litre for petrol. All other fuel stations sell to the
public petrol at $22 300 a litre and diesel at $20 800 a litre. Selected
service stations sell the same amount of petrol and diesel at US$1 a
Farmers have been diverting the fuel onto the black market while
some Noczim officials have faced similar allegations. Analysts say the three
tier pricing system opened loopholes for the black market.
statement, coming 24 hours after the reprieve, shows that Zimbabwe has no
interest in implementing reforms despite Gono's posturing. Analysts say
internally the statement is an indication that government and the central
bank are at odds on what they want to achieve.
"This shows that there is
no political will. This economy will never recover unless we break the
political impasse," Zimbabwe Congress of Trade Unions (ZCTU) economist,
Prosper Chitambara, said.
"If we have a political settlement it means
that we would significantly reduce our risk factor which has so far sacred
investors from Zimbabwe," Chitambara said. Zimbabwe National Chamber of
Commerce president Luxon Zembe said it was critical for Zimbabwe to source
balance of payments support to stabilise the dollar.
balance of payments support to stabilise our dollar and this is where the
relationship with the Bretton Woods instruments is critical," he said. "No
company can sustain the current costs of doing business in Zimbabwe. If we
do not get balance of payments support to stabilise the macro-economic
fundamentals we are headed for a crash," Zembe said adding: "We are now in a
vicious cycle and it's not looking good."
Zembe lamented the lack of
coordination in government policy saying the passage of the constitutional
amendment affects security of investments. "This can stop foreign direct
investment. We need a market-driven economy, but this is difficult because
there is no coordination in government," he added.
2005 the year of investment but events on the ground show otherwise. He has
signed the Constitutional Amendment Bill into law, hammering the final nail
in the national the coffin. The new Act nationalises land, making it
impossible for any investors to commit their funds to agriculture. Remarks
by Transport minister Chris Mushowe last week that white-owned businesses
will be targeted next will have compounded negative perceptions about the
We've divine right to resist Zanu PF By Rejoice
Ngwenya MY wife is adamant that true Christians should not entangle
themselves in politics. This damning perspective includes such "earthly
things" like office bearing, attending meetings and inevitably
The catastrophic implication is that she has never, in her life,
held political office, attended a political meeting or voted. In civic
education lingo, such people would be classified a "bad
Being a true liberal democrat myself, I politely agree to
disagree with her simply because of two reasons.
Firstly, were it
not for those brave, selfless men and women who gave up their comfortable
Christian education at mission schools in the 60s and 70s - and my wife was
either not born or too young to notice - we black Zimbabweans would still be
washing the white man's bottom for a plate of sadza.
most in her generation are now doing just that in Leytonstone, London,
excommunicated through the unsightly deeds of these previous freedom
fighters-turned-fighters against freedom!
villagers sacrificed their lives for true freedom - and sacrifice is just
what every follower of Christ understands most, because the man Jesus
himself lost an earthly life to prepare us for another kingdom that is not
of this earth.
Perhaps my wife's point is about the nature of
Christians who have contaminated Zimbabwe's decaying political landscape.
They attend mass every Sunday, and spend Monday to Saturday in massive
annihilation of our civil liberties.
Yet if my wife had a
close-up view of Christian soldiers in the mould of Desmond Tutu, Martin
Luther King and Pius Ncube, this could at least convert her to that there is
nothing wrong with politics per se but everything wrong with the
architecture and machinations of Zanu PF politics.
But before you
strip wires off my doctrine of positive Christian politics (PCP) that
generally exalts freedom of choice and love, you have first to admit that
all beings naturally gravitate towards sinfulness. Everyone at one time or
another, according to the Holy Book, is a sinner - ie, lies, cheats, steals
and commits adultery "for all have sinned and come short of the glory of
In Zimbabwe, ruling party politicians have added a special
angle to that category of "all", because the vindictiveness with which they
are oppressing their own kinsman, their lust for power and total
insensitivity to the needs of citizens surprises even the originator of sin
himself, Lucifer the Serpent.
After cheating their way into
office through massive vote rigging last March, they have proceeded to
promulgate repugnant constitutional reforms that are only meant to fortify
their power, silence critics and further mutilate the residual liberties we
were clinging to.
My wife's point is therefore that if I were to
expose myself to such a vicious political environment, my attention would be
diverted from issues of spiritual purity - which is the core business of
And yet the Bible tells a different story. If you
are in search of intrigue, romance, adultery, murder, politics, corruption
and deceit, why bother chasing Wilbur Smith, Jackie Collins, Chinua Achebe
and Salman Rushdie?
Read the Bible, it's all in there - written so that
we might know.
What my wife accuses politicians of has always been
part of human nature since time immemorial - the difference being now there
is an added element of applying high technology to perpetuate partisan
propaganda. Even then, the Holy Book is loaded with examples of heroes who
deserve to assume the mettle of political
Zaphenath-Paneah, the 30-year-old Jewish captive known
also as Joseph the son of Jacob, was a politician of high esteem, gifted
with knowledge, humility and love. He was placed in the pagan royal house of
Pharaoh by divine intervention but maintained his faith up to the end,
saving two nations from starvation while in the process boasted a record of
having rebuffed advances of a lustful queen.
Women leaders have
also had their fair say in biblical history - the memorable Abihail's
daughter called Esther, who reigned in the royal court of the obscenely
wealthy and powerful King Xerxes and once again saved the injury-prone Jews
And yet my wife's argument is not just about
abstinence from politics, but also my tendencies towards defiance. I believe
that if God gave us the right to choose, no one, Zanu PF included, has a
right to take it away.
Sometimes it is important to defy authority.
Moses writes in Exodus: "The midwives, however, feared God and did not do
what the King of Egypt had told them to do; they let the boys
In other words, when a powerful autocracy stands between you,
your principles and freedom, you have the right to defy it. The very reason
why we took up arms against the Rhodesian Front was that our fundamental
rights to self-determination had been violated, despite the fact that what
Ian Smith did was, in Patrick Chinamasa speak, "constitutional". We defied
the devil's statutes to restore our dignity as a people and became part of
the world of civilisation that respects international laws and
The same opportunity has presented itself to us, again
because now our leaders - Zanu PF leaders that is - are so intoxicated with
power to the point of being spiteful of the very people they claim to have
President Robert Mugabe and his technical team have created
a video-wall of illusions and prisms to deceive the world that it is good to
destroy your own people in order to protect their sovereignty. Substantive,
collective, classical hogwash!
Ironically, we assumed our
sovereignty in 1980 and anything else becomes a cheap excuse to remain in
power. We have the right - divine that is - to resist not by humbly
submitting ourselves to such renegade authority, but effectively
participating in resistance politics.
Zanu PF has desecrated our
dignity, self-esteem and very being. Shall we stand and watch these men
trample on rights because "we are not of this world"?
Patriotic press Vincent
Kahiya WHEN Finance minister Herbert Murerwa told the Confederation of
Zimbabwe Industries (CZI) congress in Nyanga last week that "there is no-one
sitting at his house saying 'zvinhu ngazvishate (things must go wrong)'", I
almost believed him.
The fact that things have really gone bad in the
country does not necessarily mean there are people working feverishly to
ensure that the economy goes down the tubes. It could just be the absence of
the right chemistry in those running the economy or people not doing their
CZI vice-president Florence Sachikonye revealed in
one session she was chairing that she was one of three passengers who flew
on Air Zimbabwe from Bangkok to Dubai recently. To apply Murerwa's theory to
this embarrassing performance by our debt-ridden airline, no-one at Air
Zimbabwe or the parent Transport and Communications ministry is saying
Whatever the airline's motivation, it is not
helping this economy move forward. In fact such poor decision-making must be
exposed so it is not replicated elsewhere, thus becoming a drain on the
When news media take issue with such imprudent business
practices, the motivation is not to destroy the economy but to ensure that
those entrusted with running it and creating wealth remain focused on that
goal. It is called accountability and should not be such a stranger to
ministers or their fawning friends in business!
So I was
surprised when a respected businessman stood up at the congress to pronounce
the culpability of this paper and our sister publication the Standard in the
demise of the economy. David Govere seems to believe that we are saying
"As business people we must sit down with
(proprietor) Trevor Ncube and his papers to tell them what they have done to
this economy . . ." said Govere, blithely ignoring what incompetent
ministers have "done".
Then others chipped in with tired mantras
about the need for the media to be patriotic and that we should stick
together like Nigerians do when they are abroad. Perhaps I should ask why
Nigerians stick closer to each other when they are in Europe or the United
States than when they are at home! The media must be patriotic and serve
national interests, we are repeatedly told.
The question is who
defines the national interest and patriotism? According to our rulers,
national interest and patriotism involves blind allegiance to a system which
we can all see is failing.
It is flying a 245-seater plane empty in
the name of a Look East policy which only the most gullible swallow. It is
building dams and leaving them to silt instead of using them to support
irrigation and boost agricultural output.
It is evidently
unpatriotic to question why government would rather import maize from South
Africa and pay $8-9 million a tonne while it pays local farmers $2 million a
tonne. All these are not creations of the media but real issues raised at
the CZI congress by business leaders and senior government
Proponents of a patriotic press want the media to look the
other way and tell the world that everything is fine even when we do not
have fuel and food.
Ministers who drove to Troutbeck Inn should
have seen the environmental degradation caused by the wanton burning of
flora. Did they see the invaders at Ariston Holdings' Claremont Estates and
the disruption their presence has caused? If they didn't, it is the role of
the media to remind them that while they preach economic recovery and the
need to generate foreign currency, land invaders are building shacks in the
middle of fields where export crops should be grown.
media pretend to be patriotic when Transport and Energy minister Chris
Mushowe advocates the seizure of white-owned companies in the same manner as
the land reform programme while in the same breath government claims to be
What foreign investor would want to put his money
in such a risky environment where crude populism is
Those wanting to sit down and have tea with us (as RBZ
governor Gideon Gono would put it) should be pleased to know that we are
very keen to see this economy turning the corner. They should also be
pleased to know that someone does not become unpatriotic simply because they
refuse to repeat the party slogans with the same gusto as other political
Equally so, patriotism is not parroting failed policies or
celebrating success when there is none. Those who read newspapers are
cleverer than that.
It is sad when the media in many developing
countries are so worried about being perceived as unpatriotic that they
shudder at the thought of reporting anything critical about the incumbent
and the ruling order.
In any event, when did it become the job of the
news media to be called patriotic? When news becomes "patriotic", it ceases
to be news and becomes propaganda. News media become co-collaborators in
deluding the public, pretending the country is undergoing a turnaround when
it manifestly isn't. They are drooling cheerleaders for dimwits driving a
bus straight off a cliff.
To my brother David Govere, we are
prepared to sit down and talk to anyone because we want all those bright
ideas which came out of the congress to work, kuti zvinake.
THERE are numerous causes for the distressed state of the
Zimbabwean economy, but undoubtedly one of the principal triggers of the
endlessly continuing deterioration of the economy is that government is
totally unable to accept any reality that is unpalatable to it.
there is any factor which will impact negatively upon the economy,
government has so great a short-sightedness that it cannot recognise it or,
on the rare occasion that it does, it cannot conceive that it would be a
result of its own action or inaction.
If there is any occurrence
which is at variance with government's ideologies, its policies, or its
self-interest, it fails to take note of it, let alone address it, or it
attributes blame to others for having brought it about.
And if there
is any need for governmental action of a nature which would evidence that
need was as a result of that which government has or has not done, then
total myopia sets in. It cannot see that need must be fulfilled.
examples are manifold. One of the foremost is demonstrated by the ridiculous
projections which emanate annually from government as to anticipated levels
of agricultural production.
Prior to the commencement of each
agricultural season, forecasts of output are proudly released. Each such
forecast is markedly higher than the actual production in the preceding
season, but government always has some justification for the anticipated
increases, while it disregards any circumstances which negate that
Agriculture has always been the foundation of the
Zimbabwean economy. At its height, tobacco produced 237 million kilogrammes,
most of which was of exceptionally high quality. At that time, Zimbabwe not
only produced the 1,8 million tonnes of maize required to feed the populace,
but it also produced a surplus for export to neighbouring
Zimbabwe was, to all intents and purposes, the region's
granary. It produced large volumes of sugar, considerably in excess of the
national consumption need, and yielding much valuable export-generated
exchange. It had a national herd which was three times the size that it is
today, constituting world-class beef for home consumption and for
The cotton crop was acknowledged to be the finest cotton in the
world, and was produced in great volumes. Now the quality has deteriorated
markedly, and it is of substantially less value than before. Similar
circumstances apply to almost all other Zimbabwean agricultural
However, none of this deters government from annually projecting
remarkably greater production, instead of recognising the real causes of the
near-demise of the agricultural sector. And, even if that is disastrous for
the country and its people, government can readily afford to give such
projections, deluding itself and some of the gullible population. It is
already apparent that 2005/2006 will be no exception to this devastating
trend of short-sightedness, and of an inability to see realities, or of an
unwillingness to do so.
The realities behind the accelerating demise
of agriculture, unseen by a government which has grossly impaired vision, is
that it cavalierly ejected from the lands the thousands of farmers who had
long proven their very great skills and productivity, doing so in total and
contemptuous disregard for justice and equity, international law and human
Moreover, it replaced those who had fed the nation, who had
provided employment for over 300 000 farm workers, who had steadily
reinvested the profits of their efforts into further development, and who
had fuelled economic growth and well-being with, in very many instances,
those diametrically opposite to those attributes.
Of course, some of
the new farmers are very able, capable and motivated. But many were only
interested in vandalising the farm improvements in order to dispose of them
for gain more easily achieved than from working the lands. Selling the
asbestos sheeting, doors and doorframes from farm buildings, pumps, motors,
irrigation equipment, fencing, stocks of chemicals, fertilisers and
insecticides yielded quick returns at considerably lesser effort than
And for those desirous of working the lands, most had little or
no resources, or access to them, precluding them from doing so. Compounding
the catastrophic regression of agriculture, year after year government has
promised timeous availability of operational inputs, but year after year
they have failed to materialise.
In the last few weeks government has
once again shown its pronounced blindness to realities, with inevitably
appalling consequences looming ahead. Because of its almost total inability
to contain its expenditures, government is ravenous for borrowings to
supplement its revenues.
It has so destroyed its international
creditworthiness that it cannot access foreign lines of credit - save, very
possibly, for a loan from South Africa, which despite pronounced
protestations to the contrary will undoubtedly be linked to an array of
conditions focused upon transforming the Zimbabwean political and economic
environments to one of stability and international acceptability. So,
instead, it has to seek the loan funding from within the domestic
Aware that attracting the large loan inflows necessary would be
extremely difficult, and very costly within the prevailing interest rate
regime, government had a brainstorm. It was very conscious that the greatest
financial resources lie in the hands of the insurance companies and pension
funds, so government saw a golden opportunity to raise the monies
Those companies have always been required, in law, to invest a
proportion of their funds in prescribed assets which, essentially, comprise
governmental loan instruments. However, to achieve the amount of funds
required, the specified percentage to be so invested would have to be raised
to untenable levels, so some other methodology would have to be resorted
And that is where the "brain-storm" came in. With a bureaucratic
stroke of genius, government announced in the mid-term fiscal review that
hereinafter the specified percentage of funds to be invested in prescribed
assets must be computed upon the market value of the institutional
This is not only foolishness in the extreme, but also the final
nail in the economy's coffin. If all the assets of the insurance companies
and pension funds must be valued at market value, the amounts required for
investment in prescribed assets will be gargantuan. In order to have such
massive amounts of funds available, the institutions will have no
alternative but to withdraw very considerable money market investments from
the banks and building societies.
So great will be those withdrawals
that Zimbabwe could well be confronted with a banking sector crisis of equal
or greater magnitude to that which prevailed in early 2004, with a
concomitant loss of confidence in that sector on the part of economic
players. The radical extent of such unavoidable withdrawals could well
collapse several banks and building societies, and others dependent upon the
Of similar, or even greater catastrophic consequences,
is the possible total failure of the Zimbabwe Stock Exchange (ZSE). In
determining the market value of their assets, the insurance companies and
pension funds will necessarily have to value the quoted securities held by
them by reference to the last sales on the exchange of such
But, upon the institutions offloading vast quantities of
equities into the market, the values must inevitably fall very
significantly, and especially so as normally the institutions are the
principal buyers of quoted securities, and yet now they will be the sellers.
There will be very few buyers, and that will depress the sale prices very
Over and above the plethora of other calamitous
repercussions of a collapse of the ZSE, the ability of the private sector to
source investment capital by reverting to listings on the bourse, and to
rights issues, will cease, resulting in yet another major hindrance to the
much needed economic development.
The old adage, "look before you
leap", applies, but government's myopia is so great that it regularly leaps
into the chasms of economic disaster, worsening the lot of all
PRESIDENT Mugabe and Prince Charles appear to have divergent
interpretations of what happened when they met at the Pope's funeral in
Rome. Mugabe has praised the Prince of Wales as a "real gentleman" for
controversially shaking hands with him at the funeral but has dismissed Tony
Blair, who snubbed him, as a "tyrant".
Reports say Vatican officials
triggered a diplomatic incident when they gave Mugabe, Charles and Blair
seats close to each other at Pope John Paul's funeral in April. Blair
switched seats but the prince took the president's outstretched hand.
Charles's spokesman claimed at the time that he had been "ambushed" and that
he found the Zimbabwean regime "abhorrent".
But in a recent interview
with Daphne Barak, an Israeli television reporter, Mugabe claimed the two
reminisced on the past. Herbert Murerwa says he introduced Mugabe to the
prince and they chatted throughout the one-and-a-half-hour
This followed Tony Blair's hasty departure from his seat when
he realised he would be sitting next to Mugabe.
"We'd never met,"
Mugabe claimed, "but he deserted his seat because he realised that our own
seats were next to their own. But Prince Charles remained in place. He's a
They spoke about Charles' forthcoming marriage, Murerwa
However, Mugabe's and Murerwa's recollection of events has once
again been challenged by Clarence House. A spokesman for the prince said:
"The prince was caught unawares during the peace-be-with-you part of the
funeral, the traditional handshake part. Partly he was unaware and partly it
would have been very disrespectful to the church at the time for the prince
not to shake Mugabe's hand."
He added: "The prince was very much
there as an official representative at the Pope's funeral and certainly
didn't view the hour-and-a-half as a time to start having conversations with
people. To claim he had conversations with either Herbert Murerwa or
President Mugabe is not true."
In his interview Mugabe denied being a
tyrant and accused Blair of being arrogant.
"If there was judgement
by some supreme power of the three of us - Bush, Blair and Robert Mugabe -
I'd be the first to receive greater justice from the Almighty," he said.
"I've killed no one, like they are doing (in Iraq)."
recall of events is sometimes breathtaking. Has he forgotten the 20 000 who
perished during Gukurahundi? Is he washing his hands of responsibility for
As for his assertion that he has never met Blair, he needs
reminding of the hour they spent together at Gleneagles in Scotland during
the 1997 Commonwealth summit. Blair certainly hasn't forgotten the long
rambling account Mugabe gave of the land issue with its usual distortions
and contrived claims.
"I never want to see that man again," he was
reported to have said after the ordeal. His resolve was confirmed by
Mugabe's undiplomatic behaviour at the Durban Chogm in 1999 when he made all
sorts of personal attacks on the British leader in interviews with British
tabloids. Now he expects to negotiate his way out of the predicament he has
created for himself.
Last week Muckraker remarked that President Mugabe
was a hypocrite, putting on a brave face to mask his actual fear of
Zimbabwe's expulsion from the IMF. The fear was evident in Zimbabwe's hasty
payment of US$120 million (it's now risen to US$131 million) to reduce its
debt to the IMF.
Our sentiments, and Zimbabweans' mounting frustration
with Mugabe's posturing, found full expression in the Tuesday Herald's
reaction to the president's attack on the IMF. Following the reprieve,
Mugabe rushed to Cuba where he told his fellow outcast Fidel Castro that
Zimbabwe was not a friend of the IMF and was "unlikely to be its friend in
Commenting on Mugabe's two-faced behaviour, Herald political and
features editor, Caesar Zvayi, said: "This statement left some people
puzzled, especially in light of the sacrifice Zimbabwe made by using the
scarce foreign currency reserves to pay part of the debt to the IMF. Some
people felt that President Mugabe's statement was an expression of false
bravado and contradicted . . . Gideon Gono who campaigned vigorously for
Zimbabwe's continued membership of the IMF."
The message should be
clear enough. We are here dealing with a charlatan who is impervious to
reason and is only too glad to bite the hand that feeds him. Zvayi's
analysis shows the man has been consistently hypocritical since Independence
As for Gono, he has been repeatedly warned that so long as the
politics is wrongly pitched, he is fighting a lost battle. It doesn't matter
what home-grown economic concoction he might dream up, Mugabe has become the
albatross around this nation's neck.
Gono has to face up to that
reality. Nobody takes seriously the drivel about Zimbabwe being under
Western sanctions, whether legal or otherwise.
And let's hope Morgan
Tsvangirai learns a thing or two from this episode. He urged the IMF not to
expel Zimbabwe because that would compound people's suffering. Instead of
being hailed for his patriotic stance, he was subjected to a nasty bit of
character assassination by a suborned journalist in the Herald
Meanwhile, who will take Mugabe seriously when he talks about
Zimbabweans enjoying improved living standards "as we work to fulfil the
expectations of the millennium declaration"?
He welcomed the support
of "our development partners" in achieving the Millennium Development Goals.
These are presumably the same development partners who are having difficulty
getting aid to the victims of Murambatsvina?
As for improved living
standards, we need to remind ourselves that this is the same leader whose
policies have seen the economy shrink by a third in recent years,
unemployment climb to 75%, and poverty escalate. And then he stands on a
public platform and says poverty eradication is a priority!
understand why George Charamba should complain, as he did on Saturday, when
the Zimbabwe Independent exposes this hypocrisy. It is all rather
But when the Herald is inviting its readers to swallow
every claim Mugabe makes, somebody has to point out that the man is
seriously delusional. Poverty is on the rise. More people are poorer and
unemployed today than they were last year. Murambatsvina has added to their
Mugabe is not only head of state and of government, he is at
the centre of policy-making and his word is law. There is no "butt outside
the president", as Charamba would have it. He is accountable for the mess we
find ourselves in whether his dissembling spokesmen like it or
Meanwhile, Charamba's defence of Nolbert Kunonga is understandable.
The man is an apologist of the regime that now sustains him. But it is too
late to rescue him.
Anglicans everywhere are aware of the damage done
by this fawning prelate. Forget the smoke-and-mirrors stuff over ties to
empire and just ask the ordinary Zimbabwean church member what he thinks of
the bishop. There's your verdict.
Muckraker was intrigued by a
website providing details of the Silver Jubilee and reflecting the Zanu PF
regime's claims to be conducting a turnaround programme.
inspection found it was the product of a company called IC Publications
which publishes Baffour Ankomah's New African , a magazine that has proved
sympathetic to Mugabe's policies.
The company's publications, including
New African , have " a reputation for editorial excellence, cutting edge
reporting and integrity and are known for their independent, objective and
balanced reporting", we are told.
If that is so, we're sure New African's
old-school editor will have no difficulty in telling us who paid for his
trips to Zimbabwe which resulted in glowing accounts of President Mugabe's
Another apologist, Viola Plummer of the December 12
Movement, appeared on the History Channel's biography of Mugabe last Friday
evening. Thankfully, her na´ve attempts at solidarity were eclipsed by more
authentic voices, most notably former Daily News editor Geoff Nyarota and US
activist Salih Booker.
But the producers should be told to run their
material past one or two of the people they interviewed before screening to
avoid embarrassment. Ian Smith was not "colonial governor" and Sir Robin
Renwick was not "former ambassador to Rhodesia". He was ambassador to
But we liked Chester Crocker's comments on Mugabe's state visit
to Washington shortly after Ronald Reagan became president. "Mugabe had the
habit of sticking his finger in your eye," Crocker noted. Apparently he
lectured Reagan on his Central American policy in much the same way he later
lectured Blair on land. Crocker was told not to invite him
Joshua Nkomo was shown arriving in the UK after having been hounded
out of Zimbabwe in 1982. "In my 35 years of struggle against white
supremacy," he said, "I have never suffered as I have in the two years of
Mugabe's rule." Let's remember that on Unity Day this year.
enjoyed Newsnet chief correspondent Reuben Barwe's snap survey on what
people feel about life in Zimbabwe. The question said it all.
like: "Would you say if you have survived in Zimbabwe you can survive
anywhere else in the world?"
Most respondents agreed although nobody
openly said they wished they were somewhere else. The gist of the matter
being: there is no worse place to live in than Zimbabwe, a dubious
distinction indeed for any country.
When Mugabe told his war cabinet that
what the country needed were " amadoda sibili " the message wasn't really
clear. But everybody now knows the full meaning of that statement. The only
question is: is there an end to this suffering?
Didymus Mutasa has threatened imprisonment for multiple-farm owners. He told
provincial land committees in Masvingo that owning more than one farm
amounts to "corruption" and that his ministry would take appropriate
"How can a single person own more than one farm?" Mutasa wondered
aloud. "These are chefs with many farms and we want to end that corruption
so that everyone gets land," he said.
We want to see who will be made
an example of in this long-drawn-out fiasco.
President Mugabe made
equally stern threats in 2003 but those who stole more than one farm appear
to have called his bluff. Then there were all those audits that amounted to
The miscreants are still holding on to their ill-gotten gains
and walking about freely in defiance. Even John Nkomo tried it when he was
Lands minister. Why should there be any action now?
Speaking at the
same meeting, Minister of State responsible for Land and Resettlement Flora
Buka talked of more land audits in the pipeline. What else does she do for a
living, we wonder?
But she had good reasons for keeping herself busy with
more land audits. "We want to avoid a situation whereby we go down in
history as people who took land then failed to use it," she
Unfortunately, Madam, that fate is unavoidable anymore. There is
all the evidence of calamity everywhere one looks, a disaster worse than
government's obsession with the conveniently distracting Hurricane