Succession battle dragging economy down

via Succession battle dragging economy down – The Zimbabwe Independent September 4, 2015

ZIMBABWE will continue on a downward economic spiral if Zanu PF remains obsessed with internal succession power struggles that currently preoccupy the ruling party, Common Markets for Eastern and Southern Africa (Comesa) secretary-general Sindiso Ngwenya has warned.

Faith Zaba in Perth, Australia

In an interview with Zimbabwe Independent on the sidelines of the Africa Down Under conference in Perth on Wednesday, Ngwenya said Zanu PF is preoccupied with petty succession battles at the expense of the economy.

He said the vicious political squabbles in Zanu PF, which have left a series of high profile casualties in its wake including former vice-president Joice Mujuru and her top allies — purged before and after the party’s controversial congress in December — have overshadowed governance and developmental issues.

Asked what Zimbabwe’s prospects of recovering from its worsening economic crisis were, Ngwenya said: “Only until they (Zanu PF) stop fighting each other, otherwise the country will not go anywhere. They are focusing on petty fights, fighting each other. They need to deal with the issue (succession) and start focusing on national development.”

Zimbabwe has been going through traumatic socio-economic turmoil since the turn of the millennium as President Robert Mugabe fought for political survival at a time his popularity had plunged due to leadership and policy failures, which gave rise to strong opposition internally and externally.

Ngwenya said African countries need to end internal and regional conflicts which he pointed out were undermining social cohesion, political stability and economic development.
Turning to the mining sector, he said while Africa is mineral-rich, one of the biggest problems on the continent is lack of transparency in the way mining deals are structured. Ngwenya said most African leaders tend to forget that they are public servants and resist accountability.

“But most importantly we must also avoid a situation where some of these deals are signed under the cover of darkness. If the people don’t benefit then there is no point of extracting the minerals out of the ground.
“You must take it from the point of view that these are non-renewable resources and you have future generations. What are you going to do for them? Only if all our leaders could be conscious that they are there as public servants to ensure that future generations are better off.

“We don’t have that transparency where we can go on a government website and see what has been signed or produced on mining.”

He gave the example of the secrecy around the mining and production of diamonds in Marange.

“Even now in Zimbabwe they have no idea of how much they mined. At one point I offered our system. I had seen statements that some of these companies collect (diamond) and they fly them out.

“I said no, we can provide a satellite system whereby when you have put them in a box and if they fly up to 25 000 feet I can track it (aeroplane) and if I lose it above 25 000 feet I track it when it goes down. If they tamper with the seal I will track,” he said, adding that the offer was rejected.

“There technology is there. What we need is just political will to do this. In Africa’s development there is no substitute for visionary political leadership, political will and commitment to develop; commitment to serve over and above everything.

“Governments need to disclose agreements and involve parliaments. It should be legislated for to say before an agreement is even signed it goes onto a public website, once you do that we are now moving along the democratic path. We allow for accountability. I like Ethiopia because they are putting in place systems that promote accountability. When it comes to corruption they catch you; it doesn’t matter who you are. This partly explains why that economy is growing at 11%. It is an economy that is transforming very fast.”

With the discovery of diamonds and other minerals in Zimbabwe, stories abound of Chinese, Russian, Israel and Lebanese networks doing business, some in gangland-style, thus siphoning and salting away proceeds of corrupt transactions offshore.

The involvement of the Zimbabwean military and other security networks in the underworld deals is cited as aiding and abetting the looting, especially of the Marange diamond fields where a culture of opacity is pervasive.
As a result, proceeds from the sale of diamonds from Marange’s Chiadzwa diamond fields remain largely unaccounted for, with Finance minister Patrick Chinamasa and his predecessor Tendai Biti complaining that revenues fell far short of projections.

“When people come back from meetings before signing, the first thing that is required is for them to go and address parliament and let the deal be debated. The major challenge we have in this sector is that it is murky, it is not transparent and we know that some individuals connive with the mining companies,” Ngwenya said.

“How do you explain a situation whereby if you look at Western Australia, mining has as Colin Barnett (Western Australia Premier) pointed out to me some years back made his people obese, but for you in Africa, I look at pictures of people barefooted; where do these resources go to?”

Ngwenya said African countries should emulate Botswana which has used diamond proceeds to build the economy and country.

Comesa is currently working on the harmonisation of mining legislation to optimise the fiscal frameworks through appropriately configured taxation mechanisms, ideally based on resource rent taxation, thus allowing for the efficient capture of benefits from the commodity price boom.

The framework would allow the region to collect optimal revenues for employment towards other developmental objectives, including investment in infrastructure and the creation of sovereign wealth funds, community development funds and trusts, said Ngwenya.