http://www.theindependent.co.zw/
Friday, 03 February 2012 12:16
Owen
Gagare
PRESIDENT Robert Mugabe’s sense of insecurity is deepening as he
fears that
Western nations are planning military intervention in Zimbabwe as
they did
in Libya and Ivory Coast, particularly after the next elections
whose
outcome is likely to be hotly-disputed.
Mugabe (pictured
right) and senior Zanu PF officials are vigorously
campaigning to take the
country to early elections with or without a new
constitution, creating a
potentially volatile situation in Zimbabwe.
Information gathered
shows Mugabe returned this week from the African Union
summit in Addis
Ababa, Ethiopia, seething with anger at how the continental
body was
handling issues mainly to do with Western intervention in hot spots
in the
region.
Officials say Mugabe fears suffering the same fate as former
Libyan ruler
Muammar Gaddafi and other dictators overthrown by Western
countries and
hauled before international courts for human rights abuses.
Zanu PF
officials indicated to American diplomats in WikiLeaks that Mugabe
feared
being “hanged” for human rights violations.
This came
after former Liberian strongman Charles Taylor was seized and
taken to the
International Criminal Court.
Mugabe seemed to be concerned about his
security while addressing the AU
this week.
“Gaddafi was killed
in broad daylight, his children hunted like animals and
then we rush to
recognise the NTC (National Transitional Council).Well well,
that was Libya.
Who will be next?” asked Mugabe.
Government officials say Mugabe’s
sense of insecurity was further deepened
after realisations that Britain and
France were active in Addis Ababa trying
to influence who becomes the AU
Commission chairperson. The AU Commission
chair runs the secretariat of the
continental body and is critical to its
decision-making
processes.
France and Britain were said to have tried to influence
the outcome of the
race for the AU Commission chair which pitted South
African Home Affairs
minister NkosazanaDlamini-Zuma, former wife of South
African President Jacob
Zuma, and the incumbent Jean Ping. Neither secured
the required two-thirds
majority, but the two nations, and other EU nations
were said to have
heavily lobbied for Ping.
Ping was backed by
France and its Western allies and this angered a number
of African leaders,
particularly Mugabe, sensitive to foreign interference
in African
affairs.
Although Mugabe does not see eye to eye with Zuma, Zimbabwe
voted for
Dlamini-Zuma. Officials say Mugabe also feels betrayed by some
African
leaders whom he believed are selling out to Western nations
resulting in the
AU’s institutions being hijacked.
It is said
Mugabe believes foreign interference in the AU Commission
election boiled
down to the West’s desire to influence political events in
different
countries, including Zimbabwe with the help of some African
countries.
The development comes at a time when state security
agents are closely
watching Prime Minster Morgan Tsvangirai’s moves
following his trips to
African nations which sat on the United Nations (UN)
Security Council.
Mugabe and his loyalists fear Tsvangirai wants to
put Zimbabwe on the UN
agenda after the elections following his
controversial visits to the Ivory
Coast, Nigeria, Gabon and Morocco.
Tsvangirai has also visited South Africa,
currently a member of the UN
Security Council. Nigeria and Gabon are no
longer
members.
Tsvangirai has previously lobbied United States presidents
to intervene in
Zimbabwe through the UN after disputed elections. In 2008,
China and Russia
blocked UN intervention in Zimbabwe mainly pushed by
Britain and its allies
after disputed elections.
Presidential
spokesman George Charamba confirmed to the Zimbabwe Independent
on Wednesday
Mugabe was bitter saying his anger had been building up over
the last three
years when French President Nicolas Sarkozy started
addressing the summit
“although his hands are dripping with blood”,
including that of Libya’s
longtime ruler Gaddafi. Sarkozy was at the AU
summit.
He said the
French and the British “forgot their differences in the EU” and
tried to
arm-twist African countries to elect Jean Ping so that they could
continue
their grip on Africa.
“The French and the British were not only
arm-twisting African countries, in
some cases they were even arm-breaking
nations,” Charamba said. “They forgot
their differences in the EU because
they wanted a pliant head, Ping, whose
pliancy was demonstrated in Ivory
Coast and Libya.”
“They didn’t want Madam (Dlamini) Zuma because she
worked under (former
South African president) Thabo Mbeki and is viewed as
strong and
principled.”
Charamba said Europe’s short-term
concern was in Zimbabwe where it wants to
control the outcome of elections
although a pliant leadership was also
needed for the control of Africa’s
resources, especially oil and minerals.
“The immediate objective is
to have influence ahead of elections in
Zimbabwe,” he said. “They want a
pliant leader who will deliver, like what
happened in the Ivory Coast and
Libya. We are aware of that.The whole issue
is targeted. It’s about
continental control of resources and Zimbabwe.
(British Prime Minister,
David) Cameron helped Sarkozy in Libya and Cote d’Ivoire
and now it’s
Sarkorzy’s turn to help Cameron in Zimbabwe,”Charamba said.
Charamba
said Mugabe was opposed to the recognition of Libya’s NTC because
prior to
the UN’s resolution 1973, which introduced a no-fly zone in Libya
resulting
in Nato bombing the oil rich country, the AU had taken a position
that the
Libyan conflict should be resolved through dialogue.
“That position
was overrun by Nato,” Charamba said, “but Africa’s position
on Libya still
stands because the AU has not rescinded it. In fact, the
Peace and Security
Commission, which is a lower body of the AU, took that
position (to
recognise the NTC) whereas all they should have done was to
recommend that
position to the AU. This summit should have made a decision
to rescind,
amend or stick with the resolution and not the PSC,” he
said.
Zimbabwe is part of the 15-member PSC and had together with
Namibia said it
was premature to recognise the NTC. Others already recognise
it, showing
wide divisions in the AU. New AU chair, Benin President Thomas
YayiBoni
recognised the political changes in Libya, emerging as opposed to
Mugabe and
others.
http://www.theindependent.co.zw/
Friday, 03 February 2012 12:42
Wongai
Zhangazha
A SOUTH African police forensic analyst said it could be
possible that
accelerants or inflammable materials were present at the fire
which gutted
the late General Solomon Mujuru’s farmhouse in Beatrice last
year.
Warrant Officer Seonyatseng Jack Maine told the ongoing inquest
into the
death of Mujuru, in Harare yesterday, that although he could not
identify
any accelerants in the debris he had examined, it did not lead to a
conclusion that there were no inflammable materials.
Maine, who
is experienced in chemical and fire debris analysis, said the
packaging of
debris at the scene was poor and, hence, could expose exhibits
to heat
thereby affecting results.
He revealed that the debris he received on
September 23 2011 from Zimbabwe’s
Criminal InvestigationDepartment
(CID)included “burnt ashes, black solid
material and cotton wool with black
residue” which were collected from three
areas in the burnt house,
particularly the main bedroom and the mini lounge.
Maine said: “I was
requested to examine the material in order to see the
presence of
inflammable materials or ignitable liquids that is any substance
that can be
used to accelerate fire, for example paraffin, petrol or diesel.
The tests I
conducted on the material did not detect any use of accelerants
or
inflammable material.
“However, it does not lead to the conclusion
that no inflammables were in
use. It could be possible that they might be
present. I say so because when
you attend a fire scene, the collection
method is very important and the
exposure to heat sometimes can affect the
results.
When you collect exhibits from a scene, it must be
either packaged in a
container that is not corrosive or it must be collected
and put inside an
oven bag because it traps everything that might be useful
in testing and
finding results.”
State prosecutor Clemence
Chimbare asked how the exhibits were packaged, to
which the forensic analyst
responded that the packaging was not up to normal
standards
used.
“They (exhibits) were packaged in plastic bags and chances are
that the
evidence might have been tampered with due to the type of
packaging.”
Regional Magistrate Walter Chikwanha, who is presiding
over the case, asked
Maine to explain whether there could be other areas
that could show
accelerants were used apart from the three points that were
collected.
“Mr Maine, you were given various packages to check
whether they had
flammable materials. The debris was collected from three
areas in the house.
Assuming that there was inflammable material on the
dressing table but
debris is collected from places surrounding the bed which
does not have
inflammable material, would you be able to detect from the
debris collected
on the bed that there was inflammable material on the
dressing table,” asked
Chikwanha.
Maine replied: “I won’t be able
to detect. I don’t know tools or methods
that they used to collect the
debris. To which I assume that it was
subjective opinion of investigative
personnel. If there were multiple
sources of fire and the debris was
collected from those areas, chances are
high that if collected properly you
can detect whether inflammables were
present or not. But if exhibits are
packaged in a plastic bag like that,
chances are high that you can’t detect
anything. The debris was not properly
packaged and it can affect
analysis.”
The Mujuru family lawyer Thakor Kewada expressed concern
that the way debris
was transported to South Africa might have been tampered
with.
“I am informed that if samples were taken from here to Pretoria
if packaging
was not adequate or if it was taken from, let’s say a boot of a
car getting
to the plane; arriving at the international airport in South
Africa, put in
the boot then to the South African police forensic labs, the
heat in the
boot of a car would it affect samples,” said
Kewada.
Maine responded: “Based on the exposure of the heat it may be
possible but I
am not saying that’s what happened.”
Maine told the
hearing that the keeping in Zimbabwe of debris for three
weeks before they
were sent to forensicswould not have affected results,
especially if the
exhibits were packaged properly.
The chief forensic analyst
specialising in explosive materials Kgotlokgomang
Ariel Lenong told the
inquest that in exhibits he had examined, no explosive
materials could be
detected.
Lenong examined material taken from the main bedroom
mattress, underneath
the bed, the carpet where the body was found, pieces of
cotton wool with
black residue and pieces of burnt curtains recovered from
Mujuru’s bedroom
and mini lounge.
Lenong said: “I was requested
to examine the exhibits for any explosives. I
examined the exhibits with two
techniques, ion and liquid chromatography. Of
the techniques I used, there
was no inorganic explosives (like) ammonium
nitrate or potassium nitrate and
organic explosives like military grenades
or motor bomb that could be
detected.”
Asked by Chimbare whether he could detect if gas
explosives were present,
Lenong said his investigations were only to do with
chemical explosives and
not gases.
Present at the inquest was
prominent South African private forensic
pathologist, Dr Reggie Perumal who
sat next to Vice-president Joice Mujuru
assisting the family lawyer with
questions.
http://www.theindependent.co.zw/
Thursday, 02 February 2012 18:13
Wongai
Zhangazha
A PROBE into the accident which claimed the life of
former Zanu PF national
commissar Elliot Manyika (pictured) in 2008 has
concluded that there was no
foul play in his death.
Investigations to
ascertain the cause of the accident and Manyika’s
subsequent death started
after some family members queried circumstances
surrounding the accident
suspecting that his injuries were not consistent
with a car
accident.
However, police investigations have concluded that
Manyika’s death was
“purely” a traffic accident.
On Wednesday,
Police spokesperson Senior Assistant Commissioner Wayne
Bvudzijena said:
“What I can say is that police investigations indicated
that his death was
purely a road accident. There was no further police
action.”
The
accident occurred on the 145km peg along the Zvishavane-Mbalabala Road
after
Manyika’s official Mercedes Benz vehicle reportedly burst a tyre and
careered off the road killing him instantly.
He was travelling
from Mutare to Gwanda on Zanu PF restructuring business.
Police
sources insisted that there was no need for an inquest into Manyika’s
death
since preliminary investigations and a doctor’s report had proved that
he
had died of injuries sustained in the accident. The police sources said a
Harare magistrate also ruled out any foul playlast year, thereby dismissing
calls for a public inquiry.
Chief Superintendent Crispen
Makedenge led investigations in the case.
Efforts to obtain the docket were
fruitless since its whereabouts could not
be
ascertained.
However,some family members this week pleaded ignorance
on the latest
findings of no foul play.
“We are not aware of the
conclusions. Maybe some family members were told
and did not relate the
information to the rest of the family. If it was
their conclusion what can
we do? Information was closely guarded and it even
makes the whole situation
more painful,” said the close relative.
The family had requested a
thorough investigationafter expressing suspicions
that a wound found on
Manyika’s head could have been from a bullet shot.
As part of the
investigations, a tyre of Manyika’s Mercedes Benz was sent to
South Africa
for forensic examination.
A relative said the family long suspected
that “a lot was not adding up in
the accident hence the idea to have a more
detailed investigation”.
The relative also revealed that just before
the accident, Manyika had
received death threats from anonymous people.
http://www.theindependent.co.zw/
Thursday, 02 February 2012
18:12
Herbert Moyo
ZIMBABWE Lawyers for Human Rights (ZLHR) has
warned Copac against producing
a draft constitution that maintains
unfettered power in the hands of the
executive and emasculates other organs
of government, including the
legislature and judiciary.
The warnings are
contained in a book entitled Zimbabwe’s Constitutional
Drafts –– Comparison
and Recommendations presented to the
constitution-making body in Harare a
fortnight ago.
The book also compares the Lancaster House
constitution, currently in use,
with other constitutional drafts, which
include the Constitutional
Commission draft and the National Constitutional
Assembly and Kariba Drafts,
and makes recommendations aimed at assisting the
Copac process, among other
things. The ZLHR criticised the present Lancaster
House constitution and the
existing drafts for bestowing too much power on
the executive with virtually
minimal checks and balances from other organs
of government.
They recommended that the executive be led by a prime
minister whose
political party commands the majority of parliamentary seats
and a
ceremonial president as Head of State.
According to the
ZLHR, the constitution should ensure that the executive was
subjected to
appropriate and effective restraints that prevent it from
dominating other
constitutional bodies or branches of government as was the
present
scenario.
This could be achieved by enactment of clauses requiring
approval from the
legislature or an independent body for key decisions, such
as declaring war,
martial law, a state of emergency, concluding treaties and
the making of
senior appointments. Such decisions are made by the president
alone under
the current constitution, and all existing drafts maintained
this status
quo.
Another way of limiting the executive’s power
would be through provisions
making it accountable to the courts for failure
to exercise power in the
manner prescribed by the constitution. Presently,
the president is immune to
prosecution for actions carried out in his
individual or official capacity.
The ZLHR also recommended only a
legislature with popularly elected
representatives with no room forexecutive
appointments as is the case under
the current constitution whereby the
president has a huge influence on the
legislature through direct and
indirect appointment of chiefs, provincial
governors and non-constituency
MPs.
In the event that chiefs and representatives of other special
interest
groups were included in the legislature, the ZLHR said they should
be chosen
through the process of popular elections rather than be appointed
by the
executive. Parliament should also have full power to set its own
calendar,
terms and activities, including its dissolution rather than the
present
scenario where the president can dissolve parliament at his
pleasure.
The lawyers’ body believes that the independence and
effectiveness of the
judiciary could be enhanced by constitutional
provisions to have judges
appointed and removed by an independent Judicial
Service Commission (JSC)
rather than by the executive, so that they do not
owe their loyalty to
another branch of government.
They felt that
the JSC should not be appointed by the executive, but by a
legislative organ
and include individuals chosen by different stakeholders
and members of the
legal community.
They also recommended that there be separation of
the office of the
Attorney-General with the creation of a National
Prosecuting Authority to be
headed by a Director of Public Prosecutions
responsible for all criminal
prosecutions.
The Attorney-General
would remain as legal adviser to the executive.
Appointments and removal of
these officials should be carried out by an
independent commission rather
than by the executive to ensure greater
judicial
independence.
Furthermore, the constitution should mandate both
officials to provide
annual reports to parliament in its public sessions for
the purposes of
public scrutiny and accountability.
The ZLHR’s
input attracted mixed reactions from Copac’s co-chairpersons.
Douglas
Mwonzora of the MDC-T said that he personally welcomed contributions
from
the ZLHR because they were valuable from a legal perspective and would
assist the drafters.
“I have drafted before and this is the third
constitution that I’m involved
in,” said Mwonzora.
Zanu PF’s Paul
Mangwana dismissed the ZLHR’s recommendations as irrelevant
stating that
Copac had done enough to ensure a constitution “for posterity
because the
people’s representatives went out to the people and solicited
their
views”.
Edward Mkhosi of the MDC described the ZLHR suggestions as
premature because
the constitution-making process was on-going saying any
criticism of the
Copac process should be made when the draft was completed.
http://www.theindependent.co.zw/
Thursday, 02 February 2012
18:10
Nduduzo Tshuma
ZANU PF factions are sucked in a race to
capitalise on the swelling
popularity of Mines minister Obert Mpofu in
Matabeleland following the
Umguza legislator’s attraction of a huge crowd at
his weekend birthday and
graduation party in Nyamandlovu last
Saturday.
Over 10 000 people attended Mpofu’s party, indicating that he could
inherit
the popularity of the late nationalist Joshua Nkomo in the region.
Mpofu’s
influence has been dramatically increasing since he splashed
donations to
his political party, musicians and the region’s soccer giants
Highlanders
Football Club.
However, the presence of Defence
minister Emmerson Mnangagwa, who is
believed to be leading a faction to
succeed President Robert Mugabe, raised
speculation that the two were
forming a formidable alliance. Mnangagwa
rarely visits
Matabeleland.
In 2009 Mpofu displayed his ambitions when he
challenged Vice-President John
Nkomo in the race to succeed the late Joseph
Msika.
The Nyamandlovu party, where Mpofu reportedly spent several
thousands of
dollars, also attracted Zanu PF bigwigs Nkomo, Youth and
Indigenisation
minister Saviour Kasukuwere, deputy secretary in the office
of the President
and Cabinet, and Retired Colonel Christian Katsande, among
top business
people and service chiefs.
Mpofu had all along been
linked to Mnangagwa’s rival faction led by the late
General Solomon Mujuru
until recent revelations that the Umguza MP was not
happy with the treatment
he received after the Tsholotsho debacle of 2004.
The Tsholotsho meeting was
described as a coup gathering to change the Zanu
PF
leadership.
Mpofu reportedly played a central role in busting the
Tsholotsho declaration
that saw the then Information minister Jonathan Moyo
and several top
officials being suspended.
The declaration was
against the ascendancy of Mujuru to the post of vice-
president.
“After the Dinyane issue was scuttled, Mpofu and the
Mujuru faction’s
relationship soured as Mujuru discarded Mpofu after all his
hard work.
Despite being linked to the Mujuru faction, Mpofu has been in the
middle,”
said a senior Zanu PF official.
“The past experience
with the Mujuru faction could give Mnangagwa an upper
hand though selling
him might prove a bit difficult because of his denialist
stance on the
Gukurahundi issue.’’
There have been reports that Mpofu and Moyo,
linked to the Mnangagwa-led
faction, were working together to become the
legitimate voices of
Matabeleland.
The first signs that the two
were working together was when Moyo made a
surprise appearance in 2009 at a
party to celebrate Mpofu’s appointment as
Mines minister in
Nyamandlovu.
While introducing Moyo, Mpofu was full of praise for the
former university
professor — a move that shocked many people.
In
November 2010 when Zanu PF Matabeleland North passed a vote of no
confidence
in provincial party chairman Zenzo Ncube, the sacked party boss
accused
Moyo, Mpofu, Zanu PF politburo member Jacob Mudenda and central
committee
member Fati Mpofu of being behind the move because “he was poor”.
http://www.theindependent.co.zw/
Thursday, 02 February 2012
18:09
IN our businessdigest article titled “Restoration of RBZ’s lender
status
crucial” in the January 27 issue of the Zimbabwe Independent,
Economics
lecturer Prof Tony Hawkins was quoted as saying confidence in the
financial
sector would not be restored as long as the Central Bank remained
dysfunctional. We have since established that the words were erroneously
attributed to him and sincerely apologise for any inconvenience this might
have caused him.
http://www.theindependent.co.zw/
Thursday, 02 February 2012 18:06
Faith
Zaba
THE inquest into former army commander General Solomon Mujuru’s
death has
entered its third week at Harare Magistrates’ Court and
Zimbabweans are
still puzzled as to the cause of the fire which burnt one of
the most
decorated liberation war heroes to ashes.
Testimonies from
forensic experts from the Harare Fire Brigade and Zesa did
nothing but raise
more questions into the circumstances under which Mujuru
died at his Alamein
Farm in Beatrice on August 16 2011.
As witness after witness
testified in the inquest, the mystery deepened
around what happened in the
last hours of one of Zimbabwe’s most influential
politicians — a man who was
a power broker in the deeply divided Zanu PF and
Vice-President Joice
Mujuru’s husband.
It is not clear what the inquest will conclude, but
one thing which seems to
be emerging after most of the experts have
testified is that Zimbabweans
might never know whether the death was an
accident or not.
State of Mujuru’s remains
A postmortem
carried out by Dr Gabriel Alvero deduced the cause of death as
“carbonation
due to open fire, whose origin was unknown.
“The tracheal mucosa was
red and black with carbon inside demonstrating that
the deceased was alive
when the fire started,” he said.
Unknown cause of
fire
Director of Forensic Science Laboratory in the Zimbabwe Republic
Police
Bethwell Mutandiro said he could not say “whether or not a crime was
committed”.
“My investigations did not point to either direction,
but that is acceptable
in such an inferno,” Mutandiro said.
He
said the cause of fire could not be determined but ruled out the
possibility
of such inflammables as matches, candles, Vaseline, furniture
cleaner or rat
insecticide which were in the house causing the fire.
Mutandiro said
indications were the fire started at the centre of Mujuru’s
bedroom.
He also said there were indications too that another
“seat of fire” was in
the mini lounge from where Mujuru’s remains were
retrieved.
When asked about the cause of fire, the forensic expert
said: “We could not
detect or come up with an obvious cause of the
fire.”
Station Officer for the Harare Fire Brigade Clever Mafoti said
his
department failed to ascertain what could have caused the fire because
key
evidence that could have assisted them had been destroyed.
He
said two fires broke out that fateful night at the farmhouse, a
phenomenon
usually associated with cases of arson. In rare cases, he said,
the fire may
be as a result of a short circuit.
But this was ruled out by an
electrician at Zesa, Douglas Chiradza Nyakungu,
who said investigations
conducted at the farm ruled out an electrical fault.
With the Zesa expert
saying there was no electrical fault, this has brought
to the fore the
question of what caused the fire that destroyed Mujuru’s
farmhouse and so
far the question remains unanswered 11 days into the
inquest.
Nyakungu further told the court that of all appliances
that were in the
house, none of them had high current carrying capacity,
ruling out the
possibility of the fire having been ignited as a result of
socket overload.
Mujuru dead before fire spread
Mutandiro
said indications were that Mujuru died before the fire spread into
the room
where his remains were retrieved.
“The carpet beneath the body exhibited less
fire damage compared to other
areas. The indication is that the body
prevented the carpet from catching
fire,” he said.
According to
his report presented in court: “This physical evidence
indicates that the
body was lying in that position before the fire
progressed.”
The report
also revealed that the carpet in the southern part of the room in
which
Mujuru’s remains were found was not damaged by the fire.
“Charred remains of
a curtain were retrieved from the floor along the
southern wall of the
bedroom,” read the report. “The physical evidence on
the curtains remains
indicated a downward fire progression.”
Partially burnt window
curtains were retrieved from the floor along the
north and southern walls of
the second lounge. But the window glass was
completely
shattered.
“The physical evidence indicated that the fire was
concentrated in the main
house, particularly the bedroom and the second
lounge,” read the report.
The report also said there was no physical
evidence indicating whether an
electrical fault occurred before or after the
fire.
“The contribution of an accelerant could not be determined as a
result of
the intensity and extent of the fire,” read the
report.
“The body was burnt beyond physical
recognition.”
AK-47 rifle unregistered
Deputy officer
Commanding Law and Order Chief Superintendent Crispen
Makadenge, who was the
investigating officer, said he discovered 17
severely burnt firearms, seven
magazines and burnt ammunition from the
farmhouse.
Forensic
ballistic expert, Detective Inspector Admire Mutizwa produced 15
commercial
firearm licences issued to the late general and also told the
court all the
burnt ammunition discovered after the inferno were registered
save for the
AK-47 assault rifle.
No foul play
Makedenge ruled out foul
play saying pathologist reports have shown that he
died from carbonation,
meaning there was inhalation of carbon monoxide.
But many questions
remain unanswered in the inquest. The mystery surrounding
the blue flame
which engulfed Mujuru’s burning body has still not been
unravelled. Will
Zimbabweans ever know what caused the fire?
http://www.theindependent.co.zw/
Thursday, 02 February 2012
16:44
By Linda Tsarwe
IT took a lot of effort to attract deposits
back into the system after
dollarisation. Coming from a background where
most people had lost their
savings in the banks due to hyperinflation, no
one was willing to go through
the same predicament again, especially with US
dollars. As at November 2011,
the banking sector had deposits amounting to
US$3.3 billion, having grown
from as low as US$1.4 billion at the end of
2009, signalling that confidence
is slowly being restored. In turn, due to
an increase in the deposit base,
most banks resumed their lending activities
which had been put on hold. By
December 2011, the average loan to deposit
ratio, including offshore lines
of credit, was over 87%. Local banks have
notably been the most aggressive
when it comes to lending, while the
international banks have been more
prudent.
Although deposits
have grown over the years, the hot nature of these
deposits has not really
changed. As at November 2011, demand deposits
accounted for 89.3% of total
deposits, which limits long term lending. As
such some banks managed to
secure offshore lines of credit which are
relatively cheaper and longer
term. These have not been sufficient to cater
for the funding needs of the
whole country. One therefore wonders how these
local institutions have
managed to be so aggressive in lending. It is quite
likely that these banks
have a huge funding gap due to the mismatch of
assets and liabilities on
their balance sheets.
However, the core problem that has developed
out of this aggressive lending
is that of the high default rate. It was
inevitable, considering that credit
was available at every corner though not
at the right price. If one has an
active credit account at a furniture
retailer, one with a clothing retailer
and a loan at the bank; considering
the levels of incomes that an average
consumer is getting, then there is a
strong chance that the consumer is
over-borrowed. And now it seems like the
bubble is about to burst as the
brunt of over-borrowing is catching up with
many.
It is reported that most corporates are failing to repay
the funds they
borrowed and are rolling over these facilities. Not
surprising, since most
companies had to recapitalise after dollarization and
the only option was
through debt as cheaper routes like rights issues failed
to get support from
shareholders. This has resulted in huge finance
charges.
Loan loss provisions by banks have not portrayed a true
picture of the
events on the ground. The Ministry of Finance together the
Reserve Bank have
been quoted reassuring the public that the banking sector
is safe. At a
press conference held last week, the Minister alluded to the
liquidity
challenges in the economy as attributable to expenditure pressures
during
the festive season, which was characterised by ‘high volumes of high
value
transactions’. This argument seems somewhat disingenuous. If an
account is
adequately funded then why should the bank fail to honour its
obligation?
At the CZI seminar and in the monetary policy statement,
the RBZ governor
further reassured the public that the banking sector was
safe, citing that
the bulk of the assets and deposits were in the hands of
the ‘strongest’
banks. It, however, raises the question of which banks are
being defined as
the strongest? The papers were full of reports of
‘perceived’ strong banks
that were failing to make payments to
clients.
Although opinions differ on how financial authorities should
handle a
possible liquidity crisis, not acknowledging the problem is surely
not the
solution. It is apparent that most banks are failing to honour their
obligations. Solutions such as staggering high value payments do nothing but
make banking less flexible. According to the monetary policy statement
presented by the RBZ governor on Tuesday, cash withdrawals now require a
notice period, the length of the notice period being dependent on the amount
involved. Only funds that amount to US$10 000 or less can be withdrawn on
demand. So much for the convenience of banking! It would also be a hard call
to convince the unbanked to trust the banks. No one needs a restrictive
condition attached to their hard earned cash.
Essentially, we
have gone back to a similar Zimbabwe dollar scenario of cash
rationing. Such
a move is in huge contrast to the claims that both the
Governor and the
Minister have been making about the banks being safe and
sound. In fact,
this only heightens the fears that the liquidity crisis
could be worse than
we think.
To ease the liquidity crunch, the Minister highlighted at
the press
conference that US$120 million would be availed to the RBZ for the
purpose
of carrying out its lender of last resort function in addition to
the US$7
million announced in the budget. Further, the RBZ Governor
mentioned in the
monetary policy statement that a further US$80 million
accessed from Afrexim
bank would also be channelled towards the same
purpose. A total amount of
only about 6% of total deposits! And obviously
insufficient.
Can the RBZ really be relied upon to utilise these
funds correctly after its
history with the statutory reserves and the FCAs
of gold producers? Both the
Minister and the RBZ are now talking about
issuing tradable paper backed by
statutory reserves that most likely do not
even exist. Essentially, it means
the paper is worthless. The RBZ failed to
honour the gold bonds created for
gold producers at maturity. Will the
tradable paper for statutory reserves
be any different?
Instead
of all this going back and forth, which does nothing but destroy the
confidence that has been painstakingly built up in the banking sector, some
hard decisions are required. Controlling banking by limiting transactions
does not work and has proved to not work elsewhere in the world. It actually
makes the situation worse by creating speculative opportunities.
International banks that have been blamed for not aggressively lending will
have the last laugh. Aggressive lending in this volatile environment just
does not cut it.
All the signs seem to indicate that the credit
bubble must eventually burst
despite assurances by the authorities. Whether
the authorities will
eventually admit it or not is another issue. Only time
will tell how events
will pan out. But as indicated in the monetary policy
statement, we should
brace ourselves for the worst.
http://www.theindependent.co.zw/
Thursday, 02 February 2012 15:52
By
Rodney Ndamba
THE history of Zimbabwe’s economy cannot be separated from
its past
agricultural successes in Africa in the 1980s and 1990s. While
today things
have changed, the future of farming now lies in the presence of
sustainable
agricultural processes.
Of course, farming faces risks of
climatic change associated with rising
temperatures, droughts, siltation and
excessive rainfall. For 2012, the UN
predicted rising food prices in Africa
due to poor food production. For
farmers in Zimbabwe, their ability to
produce faces various challenges such
as finance, electricity supply and
modern farming equipment etc.
It is interesting to note that
there has been very little local emphasis on
solar energy use for farming.
Many farmers struggle with irrigation during
load shedding periods where
they end up using firewood as is the case with
tobacco farmers. Reports
indicate that 46 000ha of forest were destroyed
last year for firewood to
cure 133 million kgs of tobacco, causing concerns
for climate and the
environment. However, some of these challenges can be
overcome by
considering sustainability approaches.
While the agricultural sector
may be faced with energy supply issues like
many countries in southern
Africa, investing in solar technology will soon
become unavoidable.
Interestingly, desert countries like Israel have made
great success in
agriculture by using solar energy and technology. Israel
relies on solar
energy for agriculture and for domestic use.
However, investing
in such a project requires capital. This, therefore,
means that local banks
may have to start thinking of offering sustainability
products in their
portfolios. For example, banks could offer loans
specifically for importing
agricultural solar equipment for farmers, for
which government could provide
incentives.
This article, however, explores typical issues on
agricultural
sustainability for local farmers while sharing a few thoughts
and views on
the perspective that farming is a business. Essentially,
farming requires
strategic planning which cannot be done by just the farm
owner alone. A
farmer has to consider his workers who are directly involved
in production.
Furthermore, suppliers, customers, agricultural experts,
weather experts,
regulators and financiers are essential for a good and
successful farming
business. Farmers have to consider engaging key
stakeholders frequently,
whether through an association or
individually.
Typical modern farmers think of technology, best
practices and sustainable
agriculture. For many farmers, it has been hard
for them to notice that
agricultural sustainability is certainly becoming a
barrier in many foreign
markets. In some markets they now require
information on how the soil from
which the produce are grown is
managed.
Further, some consider the working conditions of the farm
workers. A typical
example is in how Kenya’s and South America’s farmers
have been trying to
get entry for their produce into the European Union
markets. Some countries
actually demand that agricultural products entering
their markets be
ISO14001 certified. ISO14001 relates to environmental
management systems.
However, agricultural sustainability requires
farmers to consider their
impact on economic, ecological (environment), and
social needs. The
evolution of sustainability thinking in agriculture has
seen farmers
considering and competing on best practices. Some farmers
consider how they
impact on the environment, society, stakeholders and the
economy in general.
Certainly, there is a great deal in a farmer engaging
stakeholders. For
example, engaging with workers helps maintain good working
relations that
provide motivation and a shared farming
vision.
A well-motivated workforce through incentives, good
working conditions and
moral support has potential for good farming output.
Some good farmers
consider profit-sharing the same way as some successful
companies do.
Equally, it is important to engage communities around farming
areas as they
provide additional labour where necessary. They provide an
opportunity for
understanding how farming activities are impacting on them
and the
environment.
Incidents of poor stakeholder engagement by
farmers can be noticed during
marketing seasons when price wars emerge. It
is noticeable that some farmers
overlook the importance of customers, who in
turn give indications of
quality and the kind of produce expected and how
much they will be able to
pay in the following season. With this in mind, a
farmer is able to control
costs in order to meet market needs. Good farmers
should meet both primary
and secondary stakeholders at least twice or more a
year for ideas,
indications and guidance. The process of stakeholder
engagement is an
ongoing process which helps create an agricultural value
chain system.
The concept of sustainability in agriculture requires
farmers to consider
their impact on economic, environmental and social
issues. Farming
activities require management of negative environmental
impacts to avoid
soil erosion and siltation, which has potential impact on
yields. Respect
for and good management of biodiversity have the potential
to increase
yields. For instance, good pollination requires a diverse array
of insects.
Some farmers have been able to compete and be profitable by
embarking on
organic farming, to which they attribute low cost of inputs. In
developed
markets, organic products are becoming a favourite because of
health
considerations.
Certainly, the future competitiveness of
agro and farming activities in
Zimbabwe holds so much for farming
communities. Sustainability practices are
certainly becoming the norm in
many foreign markets. Therefore, farmers will
need to consider best practice
and impact on economic, environmental and
social
issues.
Their ability to consider processes such as water and
solar harvesting will
be fundamental to reducing impact on climate. While
such investments may
have initial capital outlays, there are long-term
savings, along with
sustainable profitability. In good farming countries,
farmers receive
incentives for investing time and resources in conservation
management.
Therefore, future farming activities in Zimbabwe may need to
consider
sustainability practices in order to make a strong business case
for
agriculture.
Rodney Ndamba is an ACCA member and Vice
Chair of the ACCA Zimbabwe
Executive Network Panel. He can be contacted on:
Ndamba.ro@accamail.com or
cenac@mail.com Views expressed in this article
are those of the writer and
not of ACCA.
http://www.theindependent.co.zw/
Thursday, 02 February 2012 17:14
By
Qhubani Moyo
IT is increasingly becoming clear that the harmonised
elections to choose a
new leadership of this country cannot be held any time
before March 2013,
when the lifespan of the Seventh Parliament of Zimbabwe
expires.
It is important to begin by emphasising that Zimbabweans from across
the
political divide should unite in resisting attempts by a small but
powerful
clique in Zanu PF that wants to force an early election because
they have
failed to run government the way they want. This is because of the
checks
and balances provided by the inclusive government.
There
is no doubt that the push for elections by the Zanu PF-aligned clique
are
laced with some poison and if Zimbabweans are not careful, then the
outcome
will reverse all the democratisation gains made during the inclusive
government.
The inclusive government was created to achieve a
particular set of reforms
in the country and those reforms have not been
fulfilled as yet. While there
are no timelines provided for the
implementation of the agreed GPA issues,
there is a general timeline
provided by the lifespan of parliament.
It is therefore logical that
the country will continue to implement all
agreed reforms until the expiry
of the lifespan of parliament, in this case,
March 2013. It thus becomes
suspicious when the other partners in the
inclusive government become so
ferocious in their push for elections as if
they are chasing a particular
deadline.
What is coming out is that the Zanu PF-aligned clique seems
to be chasing an
unexplained deadline which only they know and I am
convinced that it is a
deadline that is not in the best interests of the
people of Zimbabwe.
The excuse being used in calling for an early
election is that the inclusive
government is dysfunctional, yet evidence on
the ground suggests that the
country has made major strides in economic
recovery, the legislative agenda
and provision of social services to the
generality of the population.
Everyone, including Grade Zero children, knows
that if ever there was a time
when this government was dysfunctional it was
before the formation of the
inclusive government and that dysfunction was as
a result of the many years
of Zanu PF failure and poor
governance.
It is fair to suggest that, during that chaos and poor
governance, a small
but powerful clique in Zanu PF was in charge of
everything and looted the
country to its knees. The inclusive government,
unfortunately for them,
brought some order and those that thrive on chaos
are finding the going
tough.
Despite the numerous pronouncements about
the so-called dysfunction of the
inclusive government, no one has ever
explained the nature of the alleged
dysfunction.
One thing, that
is clear, is this elections push has exposed how emasculated
Zanu PF has
become. While in the past the policy pronouncements in their
central
committee, politburo, congresses and conferences translated directly
into
government policy, what is clear now is that the party has lost that
strength. It is now unable to deliver to its constituency and is now under
pressure to move like a mad man.
Unfortunately, when reason is
suspended and emotions take charge, the result
is always certain to be a
crash landing. This is the reason why the call for
elections has moved from
being a serious pronouncement to an ordinary
cliché. The calls have become
so overused that they reflect how much of an
ordinary outfit Zanu PF has
become.
It is, however, still living in the nostalgia of yesteryear
in which they
were calling the shots without any challenge. Today Zanu PF is
a fading
giant collapsing from its own weight and failure to manage its
internal
dynamics of succession. They continue to live in dreamland and a
fool’s
paradise that they are still unilaterally in charge.
This
is precisely the reason why they have failed, in the past two years, to
implement their key conference resolution of elections being held earlier
than 2013. In Zanu PF’s last two national conferences, one of the key
pronouncements made was that elections were to be held in 2011 without
fail.
The year 2011 came and went but elections are yet to be held. As 2011
came
to an end it became more and more evident that elections could not be
held
in 2011.
Zanu PF strategists and propagandists began to talk
about an election
without fail in early 2012. That position was adopted as a
key resolution in
their conference in Bulawayo in December 2011. But as
things stand it is
clear that such an election will be met with strong
resistance by the MPs
given that most of them view being a parliamentarian
as full time
employment.
Given Zanu PF’s shocking defeat in 2008,
it will be suicidal to go for an
election without the consensus of MPs. This
may lead to another situation
where they campaign for themselves only and
leave their presidential
candidate exposed. Besides Sadc and the African
Union, who are the key
guarantors of the GPA, are unlikely to agree on an
election before the
fulfillment of the major reforms.
Simply put,
a rushed election, done without consensus, will lead to disputed
results and
chaos. Sadc would not allow Zimbabwe to enter into an election
that will
destabilise the region.
While it is a fact that the regional and
continental bodies do not
necessarily dictate in the affairs of Zimbabwe,
they have a serious interest
in the outcome of the elections given the
effect of chaos in Zimbabwe’s
politics has on them. Whatever government
emerges from the election needs to
be legitimised by these
bodies.
A chaotic election will only isolate the country and this
will not help us
move forward.
The MDC-T has also not helped the
situation because of its inconsistent
policy pronouncements. In the usual
fashion, that has become a trademark of
its political operations, the MDC-T
has been talking with a forked tongue on
the matter.
One day they
are for elections, the other they are completely opposed to
them. It is
these inconsistencies that make people reach conclusions that
Zimbabwe will
be in very unsafe hands if they were to be in charge. In
contrast Professor
Welshman Ncube has stood resolutely in one position where
he has
continuously stressed on the need for the enactment of major reforms
before
elections are held. In the early days of his pronouncements the MDC-T
vilified him as a coward but now they are singing the same tune without
acknowledgement.
It does not help to push for a quick-fix
solution leading to chaotic
outcomes. It is better to endure the longer
route but come up with a durable
and sustainable product.
It is
in that light that the people of Zimbabwe should be on high alert and
mobilise themselves against any attempts to have an election without
reforms.
The focus should be on the completion of the
constitution-making process,
enactment of new electoral laws,
rationalisation of the awarding of licences
for the electronic media,
reforming of the security sector to ensure that
the security apparatus of
this country are loyal to the country and not
individuals. It is thus urgent
that the implementation of these issues is
done with speed so that the
country meets the March 2013 deadline of holding
the harmonised
elections.
Moyo is the National Organising Secretary of the MDC
led by Professor
Welshman Ncube. He can be contacted on qmoyo2000@yahoo.co.uk
http://www.theindependent.co.zw/
Thursday, 02 February 2012
17:10
‘CHINA has pledged to support the ‘just position’ of African
countries in
various international forums saying it was opposed to the ‘big,
strong and
rich countries bullying the small, weak and poor’ of the world,”
the Herald
reported on Monday.
In a solidarity speech he
delivered at the official opening of the 18th AU
Summit, chairman of the
National Committee of the Chinese People’s Political
Consultative
Conference, Jia Qinglin, said China did not attach any
political strings to
its assistance.
“We will firmly support the just position of African
countries at various
international fora,” Jia said. “As a permanent member
of the UN Security
Council, China will continue to actively participate in
affairs concerning
peace and security in Africa with a responsible
attitude,” he said.
Is that so? We are sure the Dalai Lama and the people of
Tibet would have a
very different opinion to that.
The South African
government refused to give the Dalai Lama a visa to attend
Archbishop
Desmond Tutu’s 80th birthday because the Foreign ministry feared
his trip
would jeopardise trade ties with China.
A senior South African Home
Affairs official, Mkuseli Apleni, admitted that
the Dalai Lama was blocked
from attending Tutu’s 80th birthday celebrations
last October to preserve
vital trade ties with China.
According to the BBC the Chinese were
helping Sudan’s government militarily
in Darfur in which the UN estimates
that about 300 000 people died. The BBC’s
Panorama programme, in 2008,
tracked down Chinese army lorries in Darfur
that came from a batch exported
from China to Sudan in 2005. China was also
training fighter pilots who fly
the Chinese A5 Fantan fighter jets in
Darfur.
More than two million
people are believed to have fled their villages in
Darfur, destroyed by
pro-government Arab Janjaweed militia.
So much for “just
position”!
Zanu PF Secretary for Information and
Publicity for Harare Province,
Claudius Mutero, says the typhoid outbreak in
the city is a result of
illegal sanctions imposed on the country at the
invitation of the MDC-T.
ZBC reports that Cde Mutero said they also
suspect biological warfare by
imperialists “who are using willing nationals
worldwide as conduits”.
He however said the “sanctions-induced typhoid” does
not discriminate
whether one is MDC-T or Zanu PF as it attacks all people
irrespective of
their sex, ethnicity or religious
background.
This would be hilarious if it wasn’t so tragic. Cde
Mutero and those of his
ilk would have us believe that their failure to
provide clean water and to
deal with burst sewers is as a result of the
“illegal” embargo. The decay of
service delivery infrastructure started off
way before the sanctions. Zanu
PF has to take the flak for the mess we find
ourselves in.
This is not to excuse the city council which, despite
demanding
astonishingly high rates, is not collecting garbage. At Kuwadzana
Four
shopping centre, the epicentre of the outbreak, there was no tap water
for
vendors and the only available public toilet is not working.
This is
the story in most, if not all, shopping centres in Harare. The city
council
should do more, they have no excuse.
Meanwhile
the Zimbabwe National Road Administration (Zinara), says the
country’s
highways are in a poor state and require urgent attention. As if
we didn’t
already know that!
ZBC reports that Zinara Chief Executive Officer,
Frank Chitukutuku, said his
organisation is greatly concerned with the poor
state of the country’s
highways.
Finally!
According to ZBC
last year Zinara collected US$3 million from tolling points
which has been
disbursed to the roads department though progress is yet to
be realised as
roads have become a danger owing to potholes.
“Questions have been raised
over the disbursement of funds from tolling
points and how they are used,”
ZBC said.
Muckraker agrees with ZBC on this one.
“Since the launch
of the tolling points in the country, motorists
anticipated an improvement
on the country’s highways but progress has been
slow with the proposed
dualisation of the Harare-Masvingo highway still in
its infancy while
progress on the Harare-Bulawayo road is not convincing.”
Preach on
ZBC!
Youth “empowerment” pressure group, Upfumi
Kuvadiki, has been rocked by
internal squabbles. The Herald reports that
divisions have been sparked by
reports that dismissed spokesperson, Alson
Darikayi, is claiming to be the
organisation’s leader. Darikayi is also
accused of causing despondency in
the organisation. However, Darikayi
maintains he still holds the post
declaring he would continue to represent
the organisation.
Upfumi Kuvadiki secretary general, Tatenda
Maroodza, said Darikayi was
booted out from the organisation on indiscipline
charges.
Maroodza said Darikayi was “masquerading as chairman”, a post that
does not
exist. He said because of that, and other activities in the name of
the
association without executive approval, led to the decision to expel
him.
We think the whole outfit is masquerading as an empowerment
group.
According to the Herald their claim to fame is that they
“temporarily
disrupted parking business by EasiPark that led to a
demonstration that
resulted in looting and destruction of property at the
Gulf complex”.
We were interested to note in
reports from Addis Ababa that before the
official opening of the new
Chinese-built AU conference centre last weekend,
President Mugabe had joined
his counterparts in planting trees around the
complex.
And what
happened to the trees that were planted in Harare near the Chinese
stadium?
Visiting heads of state were invited to plant trees in a wetland
area
allocated for conservation purposes.
But the Chinese have chopped
down many of those trees to make way for a
hotel complex.
We wonder who
gave permission for this appalling disregard for conservation
values in the
heart of Harare, not to mention the discourtesy shown to those
late leaders
such as Julius Nyerere and Rajiv Gandhi who were invited to
plant the
trees?
Probably the same people who have allowed car sales yards to
proliferate
around the city. The most recent is a fenced off area facing
Prince Edward
School on Tongogara Avenue. A section of Kaguvi which borders
Samora Machel
has suffered the same
fate.
Outgoing AU chair Teodoro Obiang
Nguema claimed Africa was being
“manipulated by outside powers”.
Herald
reporter Munyaradzi Huni felt Nguema’s speech “seemed to be an attack
on the
utterances by the Libyan PM who had earlier on attacked the former
Libyan
leader Muammar Gaddafi and thanked African countries that voted for
the
wanton bombing of Libya by Nato under the guise of protecting
civilians”.
Zimbabwe, we need to remind ourselves, was one of the
states which opposed
the bid by Libya’s people to liberate themselves from
dictatorship. Huni
wants to pretend civilians were not under threat. In fact
Gaddafi’s
gangsters had already embarked upon their murderous campaign
before Nato
intervened. But it is useful to see Zanu PF spokesmen endorsing
a fellow
tyrant who was trying to block his people from assuming their
democratic
rights.
As for Obiang talking about manipulation by outside
powers, the AU should
have reminded itself of the methods he used in his
ascent to power. What an
advertisement for the
AU!
On the subject of advertisements, we
enjoyed reading the praise-singing in
the Sunday News on the occasion of
Obert Mpofu’s birthday and degree award.
Our compliments to the
Lupane State University information and public
relations office. The degree
Dr Obert Mpofu is being congratulated on so
lavishly is called either a
doctor of philosophy degree or a doctorate in
philosophy, but not a
doctorate of philosophy.
Staff and students joined Dr Mpofu, his family and
the nation in celebrating
his degree, we are told.
Was it the whole
nation or just a part? And how did the university
management go about
assessing the views of the nation? Anyway, our
congratulations to
all.
Meanwhile, we would like to share with readers some of the
headlines carried
in the Sunday News supplement on the occasion of Mpofu’s
birthday: “Dr
Mpofu, The saviour of Zimbabwe’s diamond industry”; Dr Mpofu’s
diamond
touch”; “How Dr Mpofu tamed the Americans”; “Minister Mpofu
restores sanity
in mining
sector”.
The Sunday News last weekend
carried a picture of ZRP Commissioner-General
Augustine Chihuri,
Judge-President George Chiweshe, Chief Neville Ndondo,
Matabeleland North
governor Sithokozile Mathuthu, and Acting Chief Ndiweni,
Vincent Ndlovu
Mbayiwa, who, we are told, are looking at the graves of
“unknown people”
buried at Ntabazinduna police training depot after a police
passing out
parade.
We were intrigued by this picture. Have the police just
discovered the
graves? Whose graves are they? Is nobody responsible for
them? We don’t
quite understand what the judge-president and provincial
governor were doing
there? Had they been invited to view “unknown” graves?
Who is responsible
for them?
We have in this country a whole
history of human graves being uncovered. In
a post-conflict society such as
our own, should we not hold to account those
responsible for causing their
death?
And should we not also be asking how many are buried in each
grave?
In the run up to the last elections, five bodies were found at a
sports
ground in Bulawayo. We still haven’t heard who they were and how they
met
their death. We have a plethora of human rights organisations including
the
Human Rights Commission. Why are they not demanding
answers?
Jamaican dancehall artist,
Mavado, who visited Zimbabwe last week was
presented with a gift from the
President Mugabe-inspired fashion label House
of
Gushungo.
Zimbojam.com reports that the gift, a white track top with
the signature of
President Mugabe just below the left collar, was presented
by a
representative of House of Gushungo to Miss Harare 2012, Emily Kachote,
who
handed it over to Mavado.
Commenting on the gift C&A
Entertainment boss Clint Robinson, the company
responsible for bringing
Mavado to Zimbabwe, gushed that it was fitting that
Zimbabwe’s “number one
brand”, President Mugabe was getting associated with
one of reggae’s number
one brands of the moment.
The less said the
better.
Finally a Julius Malema-inspired
“JuJu” clothing label is also said to be
flying off the shelves in South
Africa.
Designer Obakeng Ramabodu, the Sowetan reports, believes the “JuJu”
clothing
label will take the fashion industry by storm, regardless of the
outcome of
the ANC youth wing leader’s appeal against his
suspension.
Ramabodu said there had been much interest in his designs
from neighbouring
countries like Zimbabwe and Botswana.
The designer was
aiming at the 10 to 36-year-old market and would include a
“JuJu Babe” range
for women, “JuJu Boy” for young men and “JuJu Kids”.
Ironically just like the
House of Gushungo label, the “JuJu” will be
produced in China. The House of
Gushungo designs are created in Singapore
and the clothing produced in
China.
Allan Mapisa, the House of Gushungo marketing manager, argues
that there is
no Zimbabwe factory yet because the House of Gushungo wants to
“maintain
quality and guard against imitations”.
The high
standards that the House of Gushungo wants to adhere to are the
reason why
they do not have a shop yet within the city, he said.
What a confidence
booster for the local textile industry. Empowerment icons
indeed!
http://www.theindependent.co.zw/
Thursday, 02
February 2012 17:08
IT is wholly understandable that Zimbabwe’s civil
servants are disgruntled,
dissatisfied and infuriated at their employer
because of the substantial
inadequacy of their remuneration.
The minimum
wage payable to civil servants is marginally less than US$250 a
month, which
equates to approximately 46% of the current Poverty Datum Line
(PDL). This
results in all but the most senior civil servants battling to
support
themselves, their families, and other dependants.
Not only does the
considerable inadequacy of their salaries aggravate the
civil servants, but
their annoyance and fury has been exacerbated by the
absence of any
substantive evidence of concern, on the part of the employer
at their
plight.
Diametrically opposed to having real concern, responsible
ministers have on
several occasions failed to attend wage negotiation
meetings and last week
the employer made a contemptuous offer of a paltry
US$7 increment.
Amongst the consequences of the employer’s near total
disregard for the
civil servants’ concerns and demands has been that a
significant majority of
them have resorted to strike
action.
However, on the other side of the coin is the
incontrovertible fact that
government simply does not have the resources to
respond positively to its
employees’ demands, or to do so even
partially.
The state employs approximately 235 000, although 70 000
of them are
believed to be ghost workers, though it is incomprehensible that
a country
with a resident population of approximately 12 million should
require such a
gargantuan civil service.
Those 235 000 civil
servants’ emoluments consume, despite their inadequacy,
approximately 64% of
the national budget, leaving a grievous insufficiency
of funding for several
other necessary governmental spendings. Effectively,
to cite an old saying,
government is “damned if it does, and damned if it
doesn’t!”.
Whilst the civil servants deserve sympathy and
understanding, and a
meaningful enhancement of their remuneration packages,
they do not wholly
have right on their side.
Firstly, demanding
minimum remuneration equal to the PDL is unrealistic in
the extreme, and
cannot credibly be justified.
The PDL, amounting to approximately
US$545 in December 2011, represents the
minimum cost of living for a family
of six. However, in such a family unit,
there are generally at least two
income earners, even if one of them may not
be engaged in formal employment,
but generating income in the informal
sector.
Assuming,
therefore, that the one is generating 60% of the family’s income
and the
other produces 40% of that income, a public service demand for a
minimum
wage equal to 60% of PDL would be credible and justifiable, and
would
currently amount to approximately US$327 per month, as distinct to a
demand
for US$545 per month.
Secondly, the civil servants’ negotiators for
the remuneration increase
studiously disregard the harsh fact that an
employer cannot pay that which
he or she does not
have.
Government, on its own admission, is bankrupt, with vast
unserviced and
unmanageable debt. On the other hand, it is already
over-taxing the private
sector, which continues to be beleaguered by
numerous and diverse economic
ills and constraints. Therefore, it cannot
resort to yet further taxation
measures in order to fund any significant
increase in civil servants’
remuneration.
Thus, the civil
servants are demanding the impossible, and resorting to
industrial action or
work stoppage can in no manner enable government to
access additional
resources in order to yield to the demands.
Instead, such strike
action further cripples the much-stressed economy, and
that will impact
negatively upon inflows to the state and, therefore, to its
ability to
service even existing packages.
Thirdly, the civil servants need to
take cognisance that their demands have
other adverse economic consequences,
in that diverse trade unions and other
labour representative bodies are
motivated to emulate the public servants by
also demanding wages aligned to
the PDL by resorting to destructive
industrial actions in response to
employers’ refusal to yield to those
demands.
The result is that
the civil servants are endangering an already weak
economy, albeit only
indirectly so, without their actions being able to
bring about fulfillment
of their demands.
Whilst obviously not pertaining to all in the
public service, it is
undoubted that a significant number of civil servants
seek to compensate for
the inadequacy of their remuneration by resorting to
innumerable corrupt
actions, not only being unlawful, but also impairing the
proper utilisation
of government’s limited resources.
This
results in the diminishing of the morale of the populace, and further
damaging the economy. The corrupt practices resorted to are varied and have
different cost effects.
They range from the disclosed but not
contained employment of 70 000 ghost
workers, to the misappropriation of
state-funded consumables such as
stationery, tools, foodstuffs, and the
like, to falsified expenditure
claims, and to abusive and unauthorised usage
of state assets, such as usage
of motor vehicles and concomitant
state-funded fuel for non-authorised,
private
purposes.
Government needs to vigorously contain the massive revenue
losses occasioned
by such corrupt actions, and doing so would enhance the
revenue of the
exchequer and, therefore, ability to pay greater and
justified remuneration
to the state’s employees. The tardiness of
government to address
containment of public service corruption is
horrendous, and wholly
unjustifiable.
By way of example, how can
government credibly have failed to oust the 70
000 ghost workers, whose
existence has been known to the state for 11
months, when private sector
auditors identified that government’s payroll
included the 70 000 ghost
workers?
It would be further possible to enhance public sector
remuneration, as well
as to fund other essential expenditures which
government has heretofore been
unable to address, if it would intensively
contain many of its existing
expenditures. Government must be ready to
progressively reduce the
excessively large public service.
The
magnitude of delegations repeatedly travelling abroad could be
considerably
reduced, with a resultant substantial saving on travel costs.
The Finance
ministry should energetically strive to convince the political
hierarchy
that Zimbabwe has far more ministers, deputy ministers and
ministries than
are required for a country with a resident population of
only 12
million.
A significant reduction in such numbers would markedly
benefit the state’s
minuscule fiscal resources. The same would hold good
for the consolidation
of the country’s diplomatic representations abroad.
Zimbabwe cannot afford
the considerable number of embassies, consulates, and
allied offices that it
presently has in Europe, Africa, and the Far East.
And these are but a very
few of the many constructive expenditure savings
that the state could
achieve, provided that it has the will to do so. The
resultant savings
would enable more constructive expenditures, such as
enhancement of
remuneration for the public service.
http://www.theindependent.co.zw/
Thursday, 02 February 2012
17:03
Owen Gagare
PRIME Minister Morgan Tsvangirai’s frustration
over the failure to implement
provisions of the GPA is a clear indication
that Zanu PF’s strategy of
wearing down its opponents by stifling reforms
may be yielding results.
Analysts believe the admission by Tsvangirai that he
had failed to rein in
Zanu PF ministers such as Media, Information and
Publicity minister Webster
Shamu, who has refused to implement agreed
positions in the GPA, and the
continuous bickering over the election roadmap
was testimony that he and his
party could not force President Robert Mugabe
and Zanu PF to honour the
reform agenda.
Zanu PF’s grand plan,
according to analysts, is to throw spanners in the
coalition government
works and frustrate its partners to such an extent that
they will agree to
go for polls with most of the provisions of the GPA and
election roadmap
unfulfilled. This would, however, be a tough task
considering the stance
taken by Sadc and the other MDC formations.
In his end of year
message, Tsvangirai painted a grim picture of the
inclusive government
revealing that some Zanu PF ministers were refusing to
report to him, making
it difficult for him to monitor the Government Works
Programme. Some
negotiators last week said they felt betrayed by the
principals, Mugabe,
Tsvangirai and Deputy Prime Minister Arthur Mutambara
since they had failed
to deal with many of the issues referred to them.
The principals have
failed to implement the 24 agreed GPA items as well as
find common ground on
the outstanding issues in the agreement and election
roadmap.
Tsvangirai’s spokesman Luke Tamborinyoka said in as much
as the PM wanted
the outstanding issues implemented, he felt there was need
to fulfil agreed
items first, before attempting to tackle thorny issues such
as security
sector reforms, where there is a stalemate.
Agreed
items include the land audit and security of tenure, appointment of
provincial governors, the appointment of the board of the Broadcasting
Authority of Zimbabwe and the Mass Media Trust, hate speech, national heroes
and issues of external interference, among others, but these have not been
implemented.
The defiance by Zanu PF ministers, who were tasked
with ensuring that the
agreed items were implemented, is a betrayal of the
GPA which gave birth to
the inclusive government, the MDC
says.
Section 20.1.4 of the GPA gives the PM the mandate to oversee
the
formulation of government policies by the cabinet and also ensure that
the
policies so formulated are implemented by the entirety of
government.
The PM is also tasked with ensuring that ministers
develop appropriate
implementation plans to give effect to the policies
decided by cabinet.
“In this regard, the Ministers will report to the Prime
Minister on all
issues relating to the implementation of such policies and
plans,” reads the
GPA.
To ensure that the PM properly discharged
his responsibility to oversee the
implementation of the work of government,
he was given the responsibility of
chairing the Council of Ministers
consisting of all cabinet ministers. The
functions of the council include
assessing the implementation of cabinet
decisions; assisting the PM to
attend to matters of coordination in the
government and enable him to
receive briefings from cabinet committees.
Harare-based political
analyst Charles Mangongera said Tsvangirai’s concerns
were testimony to the
fact that the coalition government had failed.
“It confirms that Zanu
PF’s strategy is working,” he said. “Zanu PF’s grand
plan is to sabotage the
GNU by stifling the reform agenda at every level of
the governance
structure. This explains why Zanu PF hardliners have been
throwing spanners
into the works in the drafting of the constitution.”
“They hope that
they can cause the GPA to collapse as a precursor to Mugabe
calling a snap
election.”
Mangongera said Zanu PF was unlikely to agree to any
further concessions as
its hardliners pushed the election agenda. He said
conditions were not
conducive for elections, adding that Sadc would have to
step in to stop
Mugabe’s bid.
“I do not see how Sadc would okay
another sham election,” he said. “I think
Sadc has sufficient leverage to
stop Mugabe from imposing an unpopular
election, but this will also depend
on the political dynamics within the
regional bloc. Mugabe hopes to divide
them on the issue and if they fail to
speak with one voice then he will go
ahead and call an election,” he said.
Mangongera said although the PM
was frustrated by the non-implementation of
the GPA, he would not agree to
elections under current conditions.
“It would be political
suicide.”
Constitutional law expert Lovemore Madhuku said Tsvangirai
was likely to
soldier on and not give in to Zanu PF’s whims.
“They should
continue pushing for the reforms, nothing is impossible. I
believe they will
not give up,” said Madhuku.
In an interview with the Prime Minister’s
Newsletter Tsvangirai confirmed he
was looking up to Sadc and would not
agree to elections without the agreed
reforms.
“We still have to
emphasise on the process of achieving the standards that
will allow us to
run an election which is legitimate, which is acceptable by
Zimbabwean and
by regional and world standards, so we cannot put a date on
that
(elections),” he said.
“It is driven by a process and everyone knows
that process.”
Tsvangirai said Sadc, as the facilitator in the
Zimbabwean crisis was seized
with issues to do with the roadmap and the work
that negotiators have been
doing.
“I am sure at some stage
President Jacob Zuma and the Sadc Chairman will
call us to account,” he
said.
“There is no way you can have legitimacy without the
endorsement of Sadc. We
need Sadc, we need the AU and the international
community to ensure that the
process towards an election is one that is
transparent, that is free and
fair and that is legitimate.”
Zanu
PF spokesman Rugare Gumbo denied Zanu PF was throwing spanners in the
GNU
works to push for elections, although he maintained elections would be
held
this year “whether people want or not”.
“Our position has not changed
at all –– the constitution should be completed
so that the referendum and
elections can be held this year. If the MDCs
prevaricate on this issue, we
may have to go for elections alone,” he said.
He accused MDC-T of
delaying the constitution-making process to delay
elections which he said
was surprising considering “the party claims to be
popular”.
Gumbo said his party had not violated the GPA insisting
all the things the
MDC was crying about had nothing to do with the
agreement. He said if the
MDCs wanted the GPA implemented, they would have
worked hard to ensure that
sanctions are removed.
The stalemate
in the GNU would, however, most likely be broken by elections.
Indications
are that the GNU partners would struggle to find common ground
alone and
have to rely on Sadc to ensure credible polls
http://www.theindependent.co.zw/
Thursday, 02 February 2012 17:01
By Kenias
Mafukidze
Growth is a decision…
THE experiences of the last 36 months
since the formation of the Government
of National Unity have proved that
growth is a decision that any nation
takes on its own accord. This decision
has little to do with external forces
and more to do with the resolve and
resonance of purpose of the country’s
decision makers. Any country that can
rally its citizens to believe in
themselves and use their diversity to
enrich their planning will record
growth beyond measure. For Zimbabwe this
has been a cumulative growth of
23%. This takes resolve.
This
level of growth is achieved through an intense determination at
national
level by political and business leaders.They should drive the
country
boldly into a better future untampered by racial, ethnic, political
and
gender divides. The same kind of resolve and commitment drove Singapore
from
a US$2 billion economy to a US$257 billion economy in a space of 60
years
(1950-2010). The tiny island registered a whopping 12,750% growth
traced
back to 1973 (US$13 billion) and 1990 (US$43 billion).
This same
resolve drove China from an unrecognised economy in 1977 to a
powerhouse
which today cannot be ignored, with a GDP of US$6 trillion as at
2011. The
1979 - 2011 period of high economic growth led China to the
position of
economic superpower in a world where in the West economies are
experiencing
unprecedented turbulence.
Once the decision is made to grow an
economy, stakeholders must engage and
start planning this growth in unison.
Zimbabwe is on the threshold of
unprecedented growth towards a US$100
billion GDP target and all Zimbabweans
are urged to derive value from the
experiences of those who have preceded
us, such as China.
The
Chinese economic miracle
The Chinese understand the dynamics of the
global economy; its flows,
discontinuities, ebbs, and tides. They know how
to apply the dynamics of
global Economics to their advantage. Firstly,
globalisation implies
limitless possibilities for growth and economic
development, but there are
significant and amplified downside risks that
must be managed proactively.
For the Chinese, the interplay of a
large domestic market, the excess supply
of low cost labour, coupled with
falling barriers to international capital
flows, combined to create a level
of potency rarely witnessed since the
rapid industrialisation of North
America more than 100 years ago. Steadily
and consistently, the Chinese have
implemented the kind of economic,
institutional and regulatory reforms that
amplified foreign direct
investment (FDI) flows from an average of US$1,5
billion per annum in 1980,
to about US$40 billion per annum in 1999 and
currently more than US$80
billion per annum.
Chinese leader Deng
Xiaoping reasoned that the task of transforming China
would be much easier
and readily realisable if China’s comparative advantage
was put to good use.
China is a huge country with a lot of cheap labour and
a large domestic
market, thus offering limitless opportunities to
industrialists. This
explains the setting up of Export Processing Zones
initially across the
coastal areas of China.
Deng went to great lengths to court FDI and
to assure investors that their
investments were secure in China. The Chinese
understood that international
capital is timid and it is to their eternal
credit that they signalled a
consistent message that investment was safe in
China; right from the
inception of reforms in 1979. They never prevaricated.
Property rights laws
were upgraded to strengthen security of tenure and
ownership laws were
revised and improved on a continuing basis. In spite of
all their political
blunders (such as the Tiananmen Square massacre) the
Chinese never tamper
with the sanctity of property rights and they give due
priority to prudent
macroeconomic management.
Deng’s crusade for
FDI had no limits. He painstakingly courted Japanese
investors, despite the
long-standing painful history between the two
nations that went back to the
imperial, brutal Japanese occupation of
Manchuria and parts of China in the
1930s. He followed a fundamental and
time-tested principle — in order to
advance the long-term economic and
political interests of China, it was
important to build bridges — even with
former foes and vicarious
enemies.
Second, the global economy prizes certainty and political
stability: these
are key ingredients for investment growth. Deng knew that
the international
community had serious doubts regarding China’s political
stability following
events of its Cultural Revolution (1966-1976). Deftly,
he assuaged their
concerns by putting in place mechanisms for smooth
transition, guaranteeing
political stability.
Thus, while
Deng was still paramount leader, the next generation of leaders
was
identified and appropriately single-filed for succession — Jiang Zemin
and
after him Hu Jintao, and their premiers, for perfect seamless
transition.
The Chinese have, to this day, kept the same tradition. In
response, FDI has
poured into China.
Third, the Chinese understood that globalisation
is characterised by
amplified capital markets volatility — a destructive
tendency towards a
“herd” instinct. Particularly for short term flows,
investors can rapidly
pull out of an economy at the blink of an eye, with
all the dislocative
implications on exchange rates and the wider real
economy.
As such, they set out elaborate mechanisms to insulate
the Chinese economy
from the excesses of the global economy. Thus when the
East Asian crisis hit
the global economy beginning July 2 1997 with the
collapse of the Thai Baht
and the subsequent unraveling of East Asian
economies, China was a sea of
tranquility. Yes there were jitters, but not
anything that mirrors the havoc
wreaked on Malaysia, South Korea, Indonesia
and other South East Asian
economies. The Chinese understand the dynamics of
the global economy.
http://www.theindependent.co.zw/
Thursday, 02 February 2012
17:45
RESERVE Bank of Zimbabwe (RBZ) governor Gideon Gono this week gave
several
local banks failing to meet their minimum capital requirements
effectively
two months to comply or face closure.
The move came as
reports continued to swirl within the volatile financial
services sector
that a number of banks are struggling due to chronic
liquidity problems
gripping the market.
Although Gono tried to calm nerves, saying the
banking remains largely “safe
and sound”, he also admitted there are serious
problems facing financial
institutions. These include volatile deposits,
absence of an active
inter-bank market, lack of an effective lender of last
resort function by
the RBZ, market illiquidity, cash-based transactions and
limited access to
external credit lines.
For some months now a
number of banks have been battling for survival due to
poor economic
performance, low-capacity utilisation by industry and
depressed demand
against a backdrop of low disposable incomes.
The tight liquidity
conditions are mainly attributable to volatile
short-term transitory
deposits and limited lines of credit. Low savings due
to poor salaries and
wages, low interest income against high operating costs
and low
capitalisation exacerbate the situation.
Last week Finance minister
Tendai Biti admitted Zimbabwe was reeling from a
liquidity crisis and tried
to make interventions in the market to improve
the situation. The minister
came up with several measures, including
improving lines of credit and the
central bank’s lender of last resort
position.
Gono also came up
with some interventions in a bid to deal with the
worsening liquidity
crisis, delayed cash transactions and illegal
externalisation of money. In
line with what Biti had indicated last week,
Gono said there is need to
stagger high value transactions to allow banks
sufficient time to prepare
how to handle the situation.
All these market interventions were
necessitated by the deteriorating
liquidity situation.
In a move
which showed clearly the central bank was getting impatient with
weak and
vulnerable banks squatting in the market, Gono gave the struggling
institutions an April 1 deadline to meet minimum capital requirements or
face closure.
At least four banks are struggling to meet their
minimum capital
requirements, while one’s operating licence is in the
process of being
withdrawn.
According to Gono, as at December 31 2011, 20
out of 25 operating banking
institutions (excluding POSB) were in compliance
with the prescribed minimum
capital requirements, while all the 16 asset
management companies were
compliant.
In a further bid to allay
fears of a potential collapse of the banking
sector reminiscent of the 2004
situation, Gono further said: “The weak and
troubled banks in the sector are
few, small and of low systemic importance.
Collectively, as at 31 December
2011, these institutions had a combined
market share below 5%in terms of
total assets, deposits and loans.”
However, market watchers say only
six out of 26 banks are strong, while the
rest are battling for survival.
The six banking institutions, CBZ, Standard
Chartered, Barclays, Stanbic,
BancABC and ZB Bank, continue to dominate the
market in terms of
deposits.
There is also growing speculation that even big banks are
squeezed due to
precarious loan to deposit ratios.
Whatever the
situation, the most important thing now is that Biti and Gono
must keep the
banking sector stable. The stability of the financial sector
is very
critical to the shape and health of the economy. There is an
empirical link
between the banking sector and economic output and growth.
Banking sector
stability is an important driver of economic output and
growth.
Periods of instability within the banking sector have
often been followed by
a decrease in real output growth. It is also true
periods of banking sector
instability have a greater impact on output growth
than stable periods.
So in this case, responsible authorities must
quickly fix the banking sector
situation to ensure stability and sustain the
current economic recovery and
growth trends.
http://www.theindependent.co.zw/
Thursday, 02 February 2012
17:44
Constantine Chimakure
PRESIDENT Robert Mugabe and Zanu
PF have been on a campaign to stampede the
country into an election this
year despite dismally failing to fulfil the
Global Political Agreement they
voluntarily signed in 2008.
Mugabe, Zanu PF chairman Simon Khaya Moyo
and spin doctor Jonathan Moyo are
among those that have declared that
elections will be held this year without
fail. It was also one of the
resolutions made at the party’s conference last
year.
Moyo has
gone as far as saying that reforms can only be implemented after an
election. Delivering a lecture on the political situation in Zimbabwe to
officers attending the Joint Command and Staff Course at the Zimbabwe
Staff College, Moyo said: “There are some who are saying reforms first and
after reforms then elections. We see that in newspapers and other media
platforms. This is a fallacy and an unacceptable fallacy to say you must
have reforms before you hold elections. We must be confident to say it’s a
fallacy and we cannot run a country based on fallacies.”
He
added: “An election is a precondition for reforms, not to say reforms are
a
precondition for elections. If it were to be like that then we will not
have
any elections at all.”
These utterances are antithetical to the
letter and spirit of the Sadc and
AU-sponsored GPA which clearly
stipulates the need for reforms before any
election can be held. It is such
pronouncements that demonstrate, in
clear terms, Zanu PF‘s contempt for the
GPA.
How Mugabe and Zanu PF think they can get away with holding
elections
without reforms boggles the mind. It is like winking in the dark;
an
exercise in futility.
An election without reforms is bound to
be a sham election as the MDC
parties will not participate leaving Mugabe to
go it alone. If that happens
Mugabe will lose the legitimacy he desperately
seeks both regionally and
internationally.
An election without
reforms will be an insult to the guarantors of the
inclusive government,
Sadc and the AU, and Mugabe will lose friends who have
stood by him and
helped restore his legitimacy at a time he found himself in
the political
wilderness.
An election without reforms will result in the addition
and tightening of
existing sanctions. Mugabe could find himself facing
sanctions from the
United Nations leaving him even more isolated thanthe
predicament in which
he found himself in 2008 after the farcical
presidential election re-run in
June.
An election without reforms
will also erode the gains made in the economy
since the formation of the
inclusive government. With instability and
uncertainty, the country could
plunge into economic chaos which will have a
more devastating impact because
of the absence of a national currency.
Worse still, an election
without reforms couldbe a precursor to violence in
the country much worse
than the bloodshed of 2008. The bloodshed in 2008,
which the MDC-T says
claimed the lives of 200 of its supporters, was as a
result of a deficit of
reforms being prescribed by Sadc and AU. This is
especially so in a country
where the security chiefs have clearly shown they
will support Mugabe by
fair means or foul.
GPA facilitator and South Africa President Jacob
Zuma should intervene to
stop this madness before it gets out of hand and
turns the country into a
pariah state. He should also rein in recently
elected and excitable Zambian
President Michael Sata who has castigated the
MDC-T and has stoked tensions
by adding his voice to the chorus of elections
this year.
Mugabe and Zanu PF will be committing suicide should they
go ahead with
elections without reforms. Forewarned is
forearmed.
chimakure@zimind.co.zw
http://www.theindependent.co.zw/
Thursday, 02 February
2012 17:42
Itai Masuku
IN his monetary statement this week,
Reserve Bank Governor Gideon Gono
outlined a number of measures that the
central bank would undertake in order
to manage or contain risk in the
financial sector. One couldn’t agree with
him more.
As the oil of the
economic engine, the financial sector must be guarded very
jealously, lest
our delicate Zim engine ceases. If that happens, then as
those familiar with
motoring will know, overhauling the engine is a mammoth
task. Nevertheless,
it’s certainly much easier to overhaul a real engine
than it is to overhaul
an economy gone bust.
This point must be underscored:
Zimbabwe’s financial sector is very fragile.
What with its illiquid status
stemming from, among other things,
debilitating national debt, high
sovereign risk spawned by the political
risk, subsequent reluctance of
capital and credit lines and thus a battling
economy? Therefore, it is
commendable that there are efforts, at least on
paper and in word, that the
Reserve Bank is going to increase its
surveillance of the banking industry,
demanding stress tests results every
quarter.
This should prevent
the emergence of yet another Renaissance Merchant
Bank-type
fiasco.
However, the US$64 000 question is, who will supervise the
Reserve Bank
itself, given that it was the hygroscopic nucleus of the
financial storm
that devastated the very same financial sector since 2003?
As the saying
goes, who will watch the watchdog?
The financial
sector has really been partly recovering from the vicious
bites inflicted on
it by the watchdog. Lest we be accused of dwelling on the
past, we want to
acknowledge that very often, in order to move forward, we
must forgive and
forget. Forgive, yes. Forget? Is that possible? Even if we
did, the wounds
and scars are there to remind us.
It is from that premise that we
fear as some wounds are yet to heal, the
US$83 million owed banks by the RBZ
for instance, it is still difficult to
trust our
watchdog.
Healing involves reparation of damaged cells and in the
above case and in
the case of the more than US$1 billion FCA money still
outstanding,
reparation has not yet been completed.
Indeed, with
the dynamism exhibited by our local banks and entrepreneurs in
general, they
could have by now made efforts to rope in more lines of credit
from private
banks overseas. But one is sure they have not had the
conviction to do so,
hence the vast majority of lines of credit available
are from quasi
political financial institutions.
The exhortation for international
banks to bring onshore their nostro
accounts most likely has its origins in
the fact that these banks’ money was
safer for their clients out there than
in here.
As some analysts have been questioning, is the statutory
reserve money not
going to be dipped into at some point by the central bank,
as happened in
the past? And should the interbank market start operating
once again, will
excess funds that find their way into, say government
controlled banks not
be diverted to non-banking
activities.
Remember the quasi-fiscal activities of the past?
Elections? It appears
therefore, that unless there is a serious culture
change at the RBZ, the
central bank itself will remain the biggest risk to
the financial services
sector.
