via Gono livid about $1.3b RBZ debt kerfuffle 21/09/2014
DAGGERS have been drawn between former central bank governor Gideon Gono and David Chapfika over the proposed US$1.3 billion debt assumption by Treasury amid claims the Zanu PF MP is out to settle old scores with the ex-central bank chief.
Chapfika, who chairs parliament’s finance and development committee, is currently on a countrywide tour to solicit the public’s views on the Reserve Bank of Zimbabwe (RBZ) Debt Assumption Bill.
The law, if passed, will relieve the troubled central bank of the burden of repaying the debt which surged when Gono introduced his disastrous quasi-fiscal policies at the height of Zimbabwe’s economic crisis.
The hearings have however become platforms for citizens to vent their anger against Gono who insists he acted with the full blessings of his principal President Robert Mugabe.
Sources close to the former central bank chief said he was livid about the real objectives of the public hearings which he says have opened him up to ridicule and attack as his political enemies take a go at him.
“The normal procedure is that once the Cabinet Committee on Legislation has passed and recommended to full cabinet and once the full cabinet has approved the draft law, Zanu PF MPs are expected to support the proposals and ensure passage as Law.
“No other law or debt takeover has been subjected to this kind of mischief which is seemingly aimed at rubbishing both Cabinet wisdom and the former RBZ boss.
“The government has taken up the debts of various parastatals without Parliament asking the views of the public and the former governor wonders why the RBZ debt case was being treated differently.”
The government has in the past inherited huge debts owed by struggling parastatals, among them Air Zimbabwe, the Grain Marketing Board, the National Railways of Zimbabwe and the Zimbabwe Electricity Supply Authority without batting an eyelid.
The source said Gono sees the current interviews as a way of putting his leadership boobs at RBZ back into the spotlight while he is still in the process of securing the Zanu PF nomination for the Buhera senatorial seat left vacant by the death of former politburo member Kumbirai Kangai.
Chapfika’s committee also comprises Zanu PF Bikita West MP, Munyaradzi Kereke, Gono’s former ally who has now turned into his bitterest rival.
On the other hand, Chapfika himself has also in the past crossed swords with Gono after the latter fiercely resisted the indigenisation of the financial sector. The two also clashed over the controversial ZimPlats deal.
Chapfika was at the time the chairman of the National Indigenisation and Economic Empowerment, a powerful group whose mandate was to drive the seizure of foreign-owned firms in the country.
Chapfika, who was the deputy finance minister, also saw his UniBank collapse after Gono introduced a raft of tough measures in the financial sector.
Contacted for comment, Chapfika was at pains to deny he was out to get back at Gono insisting he was well within his mandate as finance committee chairman.
He said the public hearings had good intentions and were aimed at allowing the RBZ to revert back to its core functions, most importantly, as the lender of last resort.
“We are capacitating the entire banking sector to be able to lend to financial institutions overnight if they are short and also to collect any surplus monies lying idle overnight, we are actually stabilising the entire market,” Chapfika said, adding that he was in good books with Gono.
“I am doing this in my capacity as chairman and it’s not only me who is doing these public hearings … l just happen to be the chairman. If l am not there somebody else will take over those responsibilities.”
COMMENTS
Whether political intregue or not, this is definitely good governance. It’s about time that politicians started listening to the people who put them into office. This sort if outreach should be done on all major issues. It’s a shame this process was not followed on the electoral bill. Also, Gono needs to remember that there is a new constitution which nominally presumes greater democracy. His argument that this entire matter should just be swept under the carpet, as always, is outdated thinking.
Bring on the till slips and no hiding behind “national security interests”. Forensic audit by independent non-nikuv institution please. -and don’t cook the books – or burn them.
I have no sympathy for Gono but would it not be fair for those deemed to have personal endeavours against Gono or a direct interest in the outcome (either by having gained through the program) to recuse themselves regardless of whether they are the chairman etc.
This is not a court of law. While these proceedings may allow common people to express their true feeling about how they feel about Gono, no decisions are being made about his legal status. It’s simply his pride that’s being bruised, nothing more.
The 3 criminals gono chapfika kereke et all should be doing hard lab our for life !!!!!!!!!!!!!!!!!!
They will eat each other. The coffers to steal from have shrunk, their hands in the pot are now pinching each others’. Wsit and see how thieves can turn on each other.
if Cabinet has taken a decision for Govt to assume the debt. What is the purpose of the public hearings? To reverse a cabinet decision? Please continue taking your medication.
Truth is Gono amongst other faceless gallant sons of this country, repelled the sanctions war against this country. Some mistakes were made, some even downright criminal but does this guy deserve public lynching? I dont think so.
This debate is dominated by the vocal minority whilst the silent majority that benefited from Gono’s extraordinary measures do what they do best, remain silent.
Farai you refer as gallant crooks/criminals et,al who wrecked Zimbabwe?
Farai, you agree that some of Gono’s actions were criminal. Why then do you say he does not deserve public scrutiny? It is this kind of attitude – that the very people who brought this country to its knees should not be held accountable that has ruined Zimbabwe.
Meantime our jails are full of petty criminals. We cannot even account for diamond money yet some like you are quick to bleat about sanctions. Get real Farai.
We pay the taxes so we need to know, simple.. how else are govt officials going to rebuild confidence??get rid of the deviants and look for individuals with higher integrity levels to conduct our affairs…
Stealing möney in full view of the world and no jail time. Only in Africa. These thugs are a law onto themselves. They make the mafia look like amateurs.
You know what fellow Zimbo’s Gono is guilty alongside the whole of ZPF. The most guilty of all is RGM himself. Would a decent president ever have allowed any of this to happen. How can the RB of any nation just empty anyones FCA accounts and just squander the nations wealth. They all made millions on the black forex market. God has seen it all and judgment comes: from the top down. Believe me! All their hidden sin is going to be revealed. It would be better for them to repent and come clean before an angry God gets hold of them. That is if an angry Zimbabwe don’t as well. How dare they even think of passing that debt onto to the public. Zvakwana!
Mukanya and Rudadiso in politics and in life, the end ultimately justifies the means. Concepts of right or wrong are often ill defined and overated. Smith beat sanctions through the sanctions bursting activities of BAT, Lonrho, Anglo, Tinto and other multinationals. Mugabe did it through Gono amongst others. Same objectives different tactics.
If you guys knew half the staff that had to be done to ensure that Zimbabwe survived the multitude of forces that were mobilised to destroy this country, you would be shocked. There are no rules in power and politics, expediency is the only constant. You make and change the rules when you grab the power. This game is not for morally upright, honest, law abiding individuals. There is something Americans call Collateral Damage, its justifiable when in pursuit of national interests. We should be celebrating Gono as a hero not condemning him like a common criminal.
And what exactly will we celebrating about Gono, burdening the populance? Its not like the money was put to anything useful most of it was spirited out of the country.So baba vepanext door vokwereta mari from you buys beer for his friends then turns around and says I will not repay you because it was for the good of my friends would you accept that if you can then celebrate Gono its your right to do so, it is also your right to call the ministry of finance and tell them kuti you want to contribute towards paying off this debt
Would you care to explain how this country survived the sanctions onslaught unleashed on its citizenry.
Mr Tapiwa, were u consulted when the Patriotic Front agreed to takeover the Rhodesian debt?
National interests demand that government takes over the RBZ debt and it will. That’s what power and governance is all about. A handful of individuals decide for you what is in the collective interest.
sorry you have not answered my simple question and you seem to have missed my point. So to you giving of equipment to individuals who later resold them at exhobitant prices helped the country from ‘sanctions’, they put them to good use why are they failing to repay the loans.Turning paper into money and then buying US$ which were taken out of the country is that what you mean by saving the citizen.Those guys turned into US$ millionaires overnight and just exported their monies. When we talk of ‘sanctions’ maybe those countries just don’t want to do business with some individuals and its their right to decide who they do business with just like Zim decides to look west , east , up or down.
Anyway China and India have over 2 billion not to mention Russia between them so why would want to sell to ‘evil west’.The principles of the west is simple if they don’t agree with your beliefs they just don’t do business with you whether you are Russia or whoever just like Zim decided that they will take whatever they want whenever they want from whoever they want its their decision.
We would certainly have been in a far worse pickle if it wasn’t for Gono.Let’s thank him rather than persecute him with those stupid hearings.
Really, how so? Without Gono, ZANU-PF would have imploded, and by now Zim could have been well along the road to emerge from this hell. Instead, it’s business as usual for the fat cats with no hope for everyone else. And they’re asking the people to pay for their farms, vehicles and mansions on top of all that!
I didn’t think I needed to connect the dots for you. You sound like someone of above average intellect. Gono became the centre of resource mobilisation and resource allocation for the country’s import requirements for both government and the private sector. Thus neutralizing the most lethal intentions of sanctions of starving the country of essential imports. Criticize the methodology, but it worked!
As for the millions starshed away and the instant milliionares, well I dont know. I have neither knowledge nor evidence. Educate me with specifics.
No I was not consulted at all because that was not independent Zimbabwe and anyway all Im saying is that if the money was put to good use like buying farming implements then obviously there must have been a return and so what happened to that return should those people not then pay it back.Anyway the Patriotic Front invested heavily infrastructure most of which still stands today and thus even those previously suppressed have enjoyed the fruits years later i.e. there was something to show for it. Maybe Im being naive but if someone can show me how these loans benefited the people who are now being asked to pay for it then I don’t buy it. Secondly on ‘sanctions’ if people don’t want to be your friend they don’t want i.e. if someone puts sanctions on you they don’t want to be friends with you why force them.The problem is that as Zimbabwe we say we have all these natural resources and some people still say stay with with your resources that is what really makes most politicians vile and angry with the west.Its like a guy who has an expensive car who courts some girl and then girl knowing she is rich still turns him down then back bites the girl
Mr Tapiwa often times folklore assumes the status of fact even without collaborating evidence particularly in reference to ZANU-PF, Black empowerment programs and resettled farmers. E.g. the money was stolen, farmers sold their equipment. What are the facts, of the $1.3 billion debt, farm mechanisation got $200 million, less than one sixth. Farmers recently realized $800 million from tobacco sales and produced a significant maize harvest to reduce the country’s dependence on imported maize. Is this not there benefit you want to see?
Where is the other $1.1 billion? Which sector didn’t get RBZ assistance? Health, education, local authorities, manufacturing, mining, tourism and transport. Take your pick.
Farmers failing to repay? Fact! Causal, a farmer sells his maize to GMB, he is paid after 8 months. Meanwhile his working capital loan is overdue and attracting a punitive rate. When he eventual gets the money, its not enough to. cover his exposure and he looses the banks support. Cause and effect?
The problem with Sanctions is, it forces even neutral multilateral organizations like WB, IFC, ADB to take sides. if America and England dont want to deal with us, true we cant force them. But why intimidate everyone else into a coalition of the unwilling?
There are no sanctions on the government of Zimbabwe. There never have been. The World Bank, IMF and AfDB have not “taken sides.” They will not give Zimbabwe any more money because Mugabe and ZANU-PF stopped paying their bills long before the millennium. Chinamasa has already confirmed that this is the reason why the country cannot avail any funds and has nothing to do with “sanctions.” Mugabe f*cked up and continues to blame non-existent sanctions for his own incompetence.
Let me state upfront that I am apolitical. According to you and your stats 200 million gave a return of over 800 million in one year thats very good investment and return (400% if my maths is still with me). So why don’t the farmers’ payback even part of what they owe why does the government have to write off the whole amount. I do appreciate that the other money might have gone into services, why not put those statements for the people to see. If they were going around saying we borrowed 1.1 billion and say to the people as they go around you see that school there (thats what we used the money for I think people would understand) its called accountability.
But those same neutral institutions receive their contributions from somewhere dont’ they? and have to account for the money. It so happens that USA, U.K. and major contributors so are not prepared to indirectly loan to Zimbabwe when they know the money will be abused. What about all the other ‘rich friendly’ countries why are they not lending to Zimbabwe. Its always best to know where one’s bread is buttered. The Chinese make their money from the U.S.A and U.K., the Russians make their money from EU
Tapiwa is right. Why should the taxpayers be forced to take on a debt that benefited a few. Why don’t the people who got farm implements etc and made $800 million repay it. I am sure the reserve bank has records of the debtors or beneficiaries of the RBZ’s magnanimity and a sane individual would hope that they notify these recipients to pay back. Why should we suffer when the people who took the money are well and alive? It is time for the people in Zimbabwe to become more accountable. Enough is enough!
I am convinced that Farai is one of the beneficiaries who does not want to pay back what he took. Fess up Farai and pay back what you owe!
Let me state upfront that I am apolitical. According to you and your stats 200 million gave a return of over 800 million in one year thats very good investment and return (400% if my maths is still with me). So why don’t the farmers’ payback even part of what they owe why does the government have to write off the whole amount. I do appreciate that the other money might have gone into services, why not put those statements for the people to see. If they were going around saying we borrowed 1.1 billion and say to the people as they go around you see that school there (thats what we used the money for I think people would understand) its called accountability.
Not all organisational expenditure is capital. Most is recurrent expenditure e.g. wages and consumables. You wont see any structures from water treatment chemicals.
Farai speaks like a government spin doctor. He seems to have access to a lot of facts and figures that have never been published in the media. Part of the reason why the people don’t want to assume this debt is because there’s never been a proper itemization of where the money has gone. Specifically, who got a tractor, who got a scotch cart, who got a new twin cab? And yet Farai confidently states that only $200M was spent on agriculture. How does he know this? Where did this figure come from? Is he merely counting the capital investments for agriculture made by the RBZ? Does that exclude money for seeds and fertilizer? What about financial support for the GMB? Where is the investment in infrastructure? The roads, schools, hospitals and water supplies got worse, not better while Gono was buying votes for Mugabe with his so-called quasi-fiscal activities.
In fact, look up the definition…
quasi-
combining form
1. seemingly; apparently but not really.
Then look up the other part of that term…
fis·cal
ˈfiskəl/Submit
adjective
1. of or relating to government revenue, especially taxes.
“monetary and fiscal policy”
In other words, by using that term Gono, by his own admission, was stating that what seemingly looked like a legitimate government financial activity, was not really.
I also take exception to Farai’s assumption that because $800M was earned last year, mostly by tobacco farmers, that that somehow contributes to the nation’s well-being? Can people eat tobacco? Have tobacco sales brought more foreign currency into the country to alleviate the liquidity crisis? No! Most of those farmers are barely getting by and they’ve burnt down much of the forests to accomplish their meager gains. And the country still imports most of it’s maize. So much for agricultural self sufficiency.
In fact, government may have indeed invested only $200M on agriculture in 2007, but don’t forget the country also has to eventually pay for the farms that were seized without compensation. Ask Chinamasa and he will confirm that eventually it will have to happen. Zimbabwe will not be able to prosper or re-join the global economy until it learns to play by the rules that everyone else follows. Depending on when it happens and under what circumstances, the people will have to assume a debt of tens of billions of dollars to compensate those who’s assets were taken. So is an $800 Million short term gain a good return, if the price is a long term loss of $10-20 Billion for the country?
By taking private property, Mugabe made it public property and assumed all liability for it, both to the original owners and the new users. Even with supposed diamond money, the country doesn’t have enough cash to service that massive responsibility.
sometimes we want to defend the indefensible my simple point is that whether the funds were for capital expenditure or not someone has to fully account for those funds. And again my point is the farmers who got 800 million from 200 million should just pay back and then the remainder can be written off. Why is there a proposal to write off the whole amount, how much was collected these are the issues that Gono as the country’s banker and the ministry of finance should be able to provide.Ordinary individuals account for their funds so why should the government using citizens’ funds not do so regardless of ‘sanctions’ or not