The ZIMBABWE Situation Our thoughts and prayers are with Zimbabwe
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Zim Independent

Curators rake in billions
Vincent Kahiya
THE closure of troubled banks is a boon for accounting firms which have been
appointed to administer distressed financial institutions as they are
reaping a grim harvest from the crisis.

The Zimbabwe Independent can this week reveal that chartered accountancy
firms were being paid billions from depositors' and shareholders' funds for
their work as curators and conducting forensic investigations on behalf of
the central bank.

It has been learnt that a curator appointed to run a distressed bank is
entitled to up to 7% of the total value of assets recovered. For example,
assets worth $100 billion could be recovered at one commercial bank under
curatorship. This means the curator is entitled to about $7 billion in fees
for his services at the bank

Over and above this, the curator also charges professional fees and hourly
rates of up $2 million.

The 7% fees are paid out in periodic disbursements authorised by the central
bank. Apart from paying huge fees to curators, distressed banks also have to
pay millions of dollars in legal fees as the curator is entitled to hire
lawyers to assist in chasing up delinquent debtors.

However, sources yesterday said lawyers who have been hired to collect debts
were hitting a brick wall due to lack of documentation.

"These cases are generally proving difficult due to the prevalence of
insider loans and scant documentation," a source said.

The source said senior employees privy to the disbursement of insider loans
have since left the banks, making it difficult to gather information.

"The net effect of that is banks will fail to recover loans and insolvency
will increase. There is no hope of revival in most of these banks," he said.

Sources in the banking sector this week said accountancy firms which have
been hired to carry out investigations into First Mutual Life (FML)'s
dealings with Capital Alliance would be paid $1,5 billion from shareholder
funds. The Commissioner of Insurance who commissioned the probe could not
pay the fees, and it appears he ordered FML to foot the bill. Observers say
it will be interesting to see how the bank declares the moneys paid to the
accounting firm when it publishes its figures in December.

Shareholders of distressed banks have questioned the high fees being paid to
the curators from non-performing assets.

At least half a dozen financial institutions have been put under curatorship
by the Reserve Bank over the past 12 months. Curators from accounting firms
were appointed to administer the banks on behalf of the Reserve Bank.

Intermarket Holdings' subsidiaries Intermarket Building Society, its
discount house and banking corporation were all placed under the curatorship
of Ngoni Kudenga of Kudenga & Co Chartered Accountants on March 12 last

Barbican Bank was placed under the curatorship of Terry Matavire of KPMG
Chartered Accountants on March 15 2004 after the RBZ discovered that the
bank was not in a sound financial condition.

Trust Bank was closed on September 23 last year and put under the
curatorship of Peter Bailey of KPMG.

Royal Bank was put under the curatorship of Robert McIndoe of Price
Waterhouse Coopers at the end of September last year.

Time Bank was placed under curatorship in October and Tinashe Rwodzi of
Price Waterhouse Coopers was put in charge

CFX was the last bank to be put under curatorship on December 16 last year.
Fungai Kuipa of Ernst & Young was appointed curator.

It is not clear at the moment how much the curators have collected as the
process is still continuing.
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Zim Independent

Moyo keeps options open
Dumisani Muleya
AFTER his blossoming political career was ruthlessly shattered by a fierce
backlash to a "subversive" meeting which his party says he organised to plot
a new Zanu PF command structure, Information minister Jonathan Moyo is said
to be keeping his future options open.

Official sources said yesterday Moyo was playing a waiting game before he
decided what to do next. Moyo was last month blocked from the Zanu PF
central committee and dropped from the politburo.

Although he has also been barred from contesting in the Zanu PF primary
polls tomorrow to select candidates to represent the party in the general
election in March, Moyo has been hoping his fortunes could change, sources
said this week.

The Zanu PF politburo meeting yesterday failed to finalise the list of
candidates for the primaries, as some constituencies' cases - including
Tsholotsho - were not resolved. Moyo's appeal, a source said, was not even
discussed because Tsholotsho was reserved for women.

Zanu PF last night said the final list of candidates would be issued today.

However, deadlocks were reported in several constituencies where a number of
candidates were scrambling for the Zanu PF ticket for the general election.

There has been wrangling over the constituencies after some senior party
officials such as Moyo, jailed Finance minister Chris Kuruneri and Chinhoyi
MP Phillip Chiyangwa, who is also in prison on espionage charges, were
barred from the primaries.

The exclusion of a number of senior party officials triggered demonstrations
within the party. President Robert Mugabe returned from his holiday in the
Far East early this week to deal with the escalating infighting in his
deeply-divided party.

Mugabe said the issue would be dealt with although candidates with pending
disciplinary cases or who used money to buy votes would be barred. Moyo,
whose fate was almost sealed by a meeting chaired by party chair John Nkomo
in Tsholotsho on Wednesday, is said to be biding his time.

"He is keeping his options open and is likely to decide what to do next
after the primary elections," a source said.

"He has a few options such as resigning and contesting the

election as an independent candidate, leaving the country or hanging on
despite the current situation."

Efforts to get comment from Moyo were unsuccessful yesterday.

Moyo has denied a recent report in a local weekly claiming he resigned early
this month. Reliable government sources said Moyo would be back at work on
January 24 after his holiday.

He was expected to fly home on Wednesday from Kenya which he visited during
his holiday. Moyo also visited Dubai in the United Arab Emirates where he
could have been hunting for new career opportunities.

Sources said it was possible Moyo could stand as an independent candidate in
Tsholotsho because he believed the avalanche of "donations" he made in the
area would ensure his victory.
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Zim Independent

Zanu PF intensifies Tsholotsho witch-hunt
Loughty Dube
SENIOR Zanu PF leaders this week descended on Tsholotsho as the party
intensified efforts to sniff out "dissidents" who took part in the
controversial "Tsholotsho Declaration".

Politburo members John Nkomo and Dumiso Dabengwa, together with central
committee member Cain Mathema, joined the Matabeleland North provincial
co-ordinating committee in the search for those who masterminded the
Tsholotsho meeting that has seen six Zanu PF provincial chairmen being
heavily punished.

The closed-door meeting on Wednesday at Tsholotsho business centre brought
before it members of the suspended Tsholotsho district co-ordinating
committee (DCC) to explain their role in the indaba, reportedly organised by
embattled Information minister Jonathan Moyo.

Press reports yesterday said Moyo's fate was also discussed at the meeting.
They said it was agreed that he should not contest the primaries due this
weekend. Moyo last week appealed to the party's elections directorate to be
allowed to contest in the constituency. But the constituency has been
reserved for women.

The Tsholotsho saga has also claimed the scalps of Zanu PF Young Turks
Patrick Chinamasa, Jabulani Sibanda and Joseph Chinotimba, who had their
wings clipped for participating in the "illegal meeting".

Moyo was also left out of the central committee and the party's powerful
decision-making organ, the politburo.

Sources who attended the Wednesday meeting told the Zimbabwe Independent
that the party leaders also barred nearly all the women who had earlier
submitted CVs from the primaries on allegations that they were part of the
Tsholotsho plot.

The sources said out of the seven women who submitted their papers to the
party's provincial co-ordinating committee last week only Mathema's wife
Musa was likely to stand in Tsholotsho.

"All the other women candidates were barred on allegations that they were
part of the Tsholotsho Declaration. That has left Musa Mathema as the sole
candidate for the party," said a source.

"This is all viewed with suspicion in Tsholotsho as most people believe Cain
Mathema is behind the disqualification of the other women to boost chances
for his wife to stand unchallenged."

Efforts to contact Nkomo on the latest developments proved fruitless as his
mobile phone went unanswered.

However, sources said the stormy meeting resolved that the Tsholotsho DCC
should be dissolved as a matter of urgency.

The source said members of the Tsholotsho DCC traded accusations openly

on the role committee members played in the meeting.

"There was chaos at the meeting and insults were openly traded and this
shows the divisions in the party. If things continue like this, Zanu PF is
not going to win the Tsholotsho seat," said the source.

The source said Nkomo made it clear that disciplinary action would be taken
against all members of the Tsholotsho DCC for their role in the Tsholotsho
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Zim Independent

Govt on well beaten track with begging bowl
Augustine Mukaro
GOVERNMENT has once again taken its begging bowl to the donor community for
financial assistance despite strident claims that Zimbabwe can go it alone.

Information reaching the Zimbabwe Independent shows government has
approached the United Nations Development Programme (UNDP) with proposals to
fund various needs.

Highly placed sources at the UNDP said a number of government ministries
coordinated by the Social Welfare ministry have been engaged in talks with
the UNDP over the past two months.

"Government is seeking assistance in almost all facets of the economy
ranging from food, drugs, farming inputs and equipment with emphasis on the
'social sector'," a source said. "On the food side, government has
classified its appeal as 'food required for targeted feeding programmes'."

Targeted feeding programmes were launched to address the food needs of the
aged, orphans, the chronically ill and other special welfare cases in both
urban and rural communities in Zimbabwe.

Sources said the UNDP had also received proposals from the Agriculture
ministry to assist newly-resettled farmers.

The Ministry of Agriculture is appealing for seed, fertilisers, chemicals
and other farming inputs.

Production in the agricultural sector has plummeted by over 70% in the past
five years as a direct result of the chaotic land reform programme which
reduced the once vibrant commercial farming sector to subsistence farming.

The Famine Early Warning Systems Network and World Food Programme in their
recent reports projected that around 3,3 million people would need food
assistance in the lean months from December to March.
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Zim Independent

Economic crisis batters small business
Gift Phiri
IN February last year, Glen Norah furniture maker Panganai Gido drew up a
plan to expand his enterprise to regional markets by the start of 2005, with
the greater part of the investment coming from a hard-won bank loan. But 11
months later, he has shelved export plans and cut staff by more than half to
seven to survive.

"I didn't know 11 months could make such a big difference in business. I'm
almost bankrupt and yet at the beginning of last year I was financially
stable," he said, staring at bank correspondence demanding immediate
repayment of the loan he had secured for the shelved furniture export

Gido, a carpenter-turned-entrepreneur, is in a situation many Zimbabwean
businessmen find themselves in as the country grapples with its worst
economic crisis in two decades.

Zimbabwe, with inflation hovering around 150% and interest rates of more

than 100% coupled with unemployment of over 70%, has the weakest economic
fundamentals in the region, if not the whole of Africa.

Both the International Monetary Fund (IMF) and the World Bank, under
pressure from the big Western nations, pulled the plug on Zimbabwe three
years ago, accusing the government of not being committed to economic

The IMF alone withdrew a balance-of-payments support package worth US$193
million, influencing several other multilateral and bilateral donors to
similarly cut off aid to the country last year.

Unable to access cru-cial international funding, the economy has been in
free-fall since, experiencing acute shortages of most imported products such
as power and fuel which were rationed throughout 2004.

It declined by minus 4,2% last year, while the budget deficit ballooned to
23% from a projected 3,8%.

The sectoral slump was even worse. The manufacturing sector declined by
10,5%, tourism 16% and mining 14% in the four years since 2000.

Agriculture, once the mainstay of the economy, managed to claw back, growing
by 3% last year, but not enough to stabilise the economy.

It is against this background that Gido and other Zimbabwean entrepreneurs
are finding it increasingly difficult to keep their businesses afloat, let
alone pursue expansion plans, however viable.

The Confederation of Zimbabwe Industries (CZI), the country's main business
representative body, says more than 800 companies in the manufacturing
sector alone closed shop last year because of the unstable macro-economic
situation, particularly shortage of foreign currency.

"Several companies have informed us that they are closing down for good or
will re-open when the situation gets back to normal, but if things do not
improve, even more companies will be forced to close their businesses," a
CZI business development manager told the Zimbabwe Independent.

"The issue of foreign currency needs to be addressed urgently. Companies do
not have the money to import raw materials, so they are having to close
their businesses," he said.

A survey carried out by the CZI last year indicated most of its members were
operating at a maximum of 50% of capacity due to myriad difficulties
businesses faced in the country.

Its counterpart, the Employers Confederation of Zimbabwe, says more than 60
000 jobs in the formal sector were lost in the first 10 months of last year,
and expects the figure to be much higher this year.

But the government, which is widely blamed for the economy's troubles, says
Zimbabwe's difficulties are largely caused by external factors beyond its
control, citing sanctions, inflation and low mineral prices, among others.

"A lot of inflation is not because of the goods we produce here. A lot of
inflation is imported," President Robert Mugabe told the nation recently.

He also blamed the economic crisis on low prices for Zimbabwe's chief
agricultural and mineral exports, and denied his government had mismanaged
the economy.

"I know that there are areas where the government is being blamed for
following wrong policies and that we are responsible for prices going up,"
he said.

But critics of the government say top-level corruption in the public service
and excessive state borrowing, among other factors, are chiefly responsible
for the country's economic ills.

Senior government officials allegedly siphoned billions of dollars from a
state-owned oil company last year, while the cash-strapped administration is
borrowing more than $2 billion a week on the local capital markets to
finance its operations.

The government partly admits its rising domestic debt, estimated at more
than $200 billion (US$4 billion), was crowding out the private sector from
the capital markets and hardening interest rates.

"Government is increasingly spending beyond its means, for consumption, at
the expense of capital investment," opposition Movement for Democratic
Change shadow finance minister Tendai Biti said in a critique of the 2005
budget in November.

Economists say they were pessimistic 2005 would be any better for the
economy, unless the government restored links to international capital.

"Our long-term salvation lies in the government re-establishing contacts
with the IMF, World Bank and other international financial players. We need
their assistance desperately," said a bank economist.
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Zim Independent

State fiddles as land disaster unfolds
By Ray Matikinye
ALMOST five years after initiating a chaotic land reform programme, Zimbabwe
is gradually awakening to the reality that the programme has disfigured the
landscape through lack of proper land management, planning and natural
resource conservation among new landowners.

During the often-violent land seizures in 2000 characterised by stampedes to
acquire land at the behest of a harried ruling Zanu PF party to enhance its
election chances, peasants grabbed any piece of land available regardless of
its agricultural value, leaving the countryside deeply gnarled.

When indigenous trees were burnt to clear arable patches, fires blazed
unattended even after the tree had fallen leaving vast swathes of scorched
veld as a sad reminder. In numerous cases the settlers preoccupied
themselves with selling firewood on the roadside for a living instead of
engaging in productive agriculture.

Only where photographic evidence was taken of an erstwhile pristine forest
before it was chopped down, burnt and destroyed is it possible to comprehend
what the now deforested land looked like before. Only then is it possible to
grasp the devastation of wildlife as well as the ecosystem that relied on
the forest.

Virgin forests have vanished, replaced by patches of cleared land and
pole-and-mud huts dotted haphazardly on the landscape creating fears of land
degradation and desertification.

But environmental and conservation experts have begun calling on resettled
farmers to plant more trees as a contribution to global efforts to rebuild
the ozone layer that is being depleted by toxic emissions.

Acting assistant general manager of the Forestry Company of Zimbabwe,
Abednigo Marufu, says resettled farmers should now plant more trees from
which they could get fruits, fencing poles and firewood.

"Resettled farmers should plant tress as much as they can to reduce
temperature changes that cause environment hazards such as droughts and
diseases," he says, adding that they should establish small plantations to
replace the trees they cut for building houses and for firewood.

Recent studies indicate that temperatures in Zimbabwe are rising as a result
of the depletion of the ozone layer, endangering all life forms on earth,
Marufu says. The depletion of the ozone layer has brought about an increase
in the incidence of droughts throughout the world.

Experts say post-Independence resettlement schemes missed a plum opportunity
to place on the land a new category of proud and independent small-scale
farmers who could, in time, lead the revival and sustainability of

"All it needed was to select suitably qualified men and women and give them
the opportunity to establish themselves as competent individual farmers on
viable units of land, the size and capabilities of which are determined by
the agro-ecological region in which they are situated," notes renowned
conservationist Keith Harvey.

Harvey adds: "That would have stimulated individual enterprise and thereby
promoted high levels of production and expansion as well as engendering
pride of possession and a sense of permanency and patriotism."

But the destruction of the trees, plants, shrubs and grass in order to clear
land for cultivation as more land is opened for settlement has continued
despite government pleas for new settlers to observe strict conservation
practices. Land degradation has worsened an already desperate situation in
the communal lands.

Phillip Manyaza of the Natural Resources Board says deforestation causes
land degradation and ultimately destruction of the aesthetic value of the
landscape. He cites areas such as rural Murehwa, Zvimba, Chivi and
Zvishavane as examples where deep gullies have so disfigured the landscape
that urgent steps need to be taken to reverse the trend.

A much-vaunted Environmental Management Act promulgated two years ago has
done little to discourage rampant deforestation in newly settled lands.

Go to Mwenezi district in Masvingo province for example and marvel at how
settlement on land unsuitable for cropping presages disastrous consequences.
Other areas countrywide have not fared any better either.

The local people who knew these harsh conditions firsthand were initially
unwilling to take up government's offers of free land but were eventually
lured there by the prospect of satisfying their hunger for free meat. They
arrived with their dogs, nets and spears, and have used boundary fencing for
snares, ending up doing an incredibly efficient job of decimating the
wildlife population.

Poaching is regarded in many rural communities here as a craft and wildlife
numbers have dwindled also due to lack of access to its traditional water
and grazing sources. For example, baboon troops are competing for their
natural foods in the bush with the starving settlers and are now so deprived
that they are invading homesteads to raid for any type of food they can.

Due to the known water shortage in the Mwenezi district, the settlers first
settled around the cattle water points, pans, dams and sites where water was
pumped for the wildlife, thus effectively cutting off game from their
natural drinking points. Many wildlife species have died due to thirst in
this dry area where they have relied on pumped water for survival for

Technocrats and senior government officials privately admit that dryland
crops have a very low success rate when grown in this area, yet they will
not say anything against the present disastrous programme. The success rate
for dryland maize in the district is about one in six years. They also admit
and agree that the A1 settlement scheme in this low-rainfall area will not
work and that it is totally unsustainable in its present form.

But nobody in authority seems brave enough to stand up and face the
politicians and tell them that.

The settlers' livestock that now rely on the major rivers for water supply
threaten to cause massive riverbank destruction as well as gully formation
from the continual trekking to the rivers.

Marginal and erratic rainfall in rural Mwenezi does not suit the growth of
dryland crops such as maize and the clearing of agricultural lands is set to
result in further massive erosion, especially where there is uncontrolled
riverbank cultivation.

Reluctance to take corrective action by the government can be likened to the
proverbial fiddling while Rome burns. The state appears to be picking its
teeth while disaster unfolds right before its eyes.
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Zim Independent

Woza protests
Staff Writer
WOMEN of Zimbabwe Arise (Woza), a militant women's pressure group, yesterday
staged a peaceful demonstration in Bulawayo to protest the rising cost of
school fees and uniforms despite falling standards of education.

The women, numbering over 200, congregated at the main local bus terminus in
the city before proceeding to Mhlahlandlela government complex where they
sang and danced before presenting a petition to the Bulawayo governor, Cain

The placard-waving demonstrators sang songs denouncing Education minister
Aeneas Chigwedere whom they accused of bringing down education standards in
the country.

Most schools raised fees for the new term by over 200%, a move that has left
many parents unable to send their children to school.

Chigwedere is engaged in pitched battles with private schools over school
fees increases with no solution in sight.

Some of the placards carried by the demonstrators read "Education for all, A
broken promise of 1980", "Before We vote in 2005 Chigwedere must go" and
"Our Children have the right to demand an education".
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Zim Independent

Chigwedere loses to private schools
Augustine Mukaro
EDUCATION minister Aeneas Chigwedere has been barred by the High Court from
interfering with or closing schools that charge school fees higher than
those set by government.

Prior to the opening of schools, Chigwedere pegged fees for all private
schools at $8,5 million, prompting the Association of Trust Schools (ATS),
an umbrella body for private schools, to seek a court injunction against
him. An interim order granted by Justice Rita Makarau to ATS on January 4
bars Chigwedere, Education secretary Lysias Bowora and police commissioner
Augustine Chihuri, from closing down schools charging fees higher than
stipulated amounts.

"Respondents, their servants and agents are hereby restrained from closing
down or ordering or threatening the closure of schools run by any applicant
or member of the ATS by reason of any perceived or alleged contravention of
Section 21 of the Education Act," reads the order.

ATS chairman Jameson Timba said equipped with the order, all the 60 ATS
schools may demand from each parent the standard amount set by the minister
plus an equivalent amount as an advance payment while the official process
is being followed.

"It was recognised by all parties that all ATS schools be able to meet their
costs while their individual fee applications for approval of the sums fixed
in consultation with parents are being processed in accordance with the
Education Act," Timba said.

Timba said ATS schools were demanding between $7,4 million and $17,1

"There are no schools in our membership which set full boarding including
tuition at between $21 million and $28 million per term as reported by some
media with respect to Falcon, Whitestone, Peterhouse, etc," he said.

"Full boarding with tuition charges dependent on location, size, course
option and facilities range between $7,4 and $17,1 million."

Timba said before applying to hike fees every school agreed with parents
involved on a fee structure that would guarantee the pupils' education.

"Records and forecasts for the costs of operating and maintaining each
school were meticulously scrutinised in consultation with parents'
representatives before the fees needed to ensure those costs would be evenly
shared and met," he said.

Last year more than a dozen schools were closed and headmasters arrested for
charging "exorbitant fees".
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Zim Independent

Lawyers slam delays in electoral petitions
Ndamu Sandu
ZIMBABWE Lawyers for Human Rights (ZLHR) has slammed the judiciary for
delays in dealing with electoral petitions and human rights cases.

In a swift response to Chief Justice Godfrey Chidyausiku's assertion that
the delay could be attributed to the litigants themselves, the ZLHR said
such an explanation "was inconsistent and at complete variance with the
research carried out by ZLHR".

"Lawyers are generally unhappy that they experience inordinate and
inexcusable delays in the setting down of cases," the ZLHR said.

Opening the 2005 legal year on Monday, Chidyausiku said the delay in the
finalisation of electoral petitions had not been caused by the court but by
the petitioners and respondents who did not follow a set plan in dealing
with the cases. He also said the petitioners' interest in the cases had
since "waned".

"What is clear is that by the middle of 2002, the interest in these
petitions had waned and focus shifted elsewhere," he said.

The ZLHR said the situation was aggravated by the fact that in some
instances the function of the setting down and allocation of cases to judges
has been taken away from the Registrar and transferred to the Judge

The ZLHR said lawyers have faced impediments and delays in cases involving
human rights and those perceived to have high political stakes.

"For example, such delays in delivery of judgements have been experienced in
the case of the Independent Journalists Association of Zimbabwe, Associated
Newspapers of Zimbabwe (ANZ), publishers of the Daily News and Daily News on
Sunday, and the matter of Hon Roy Bennett," the ZLHR said.

Opposition Movement for Change secretary-general Welshman Ncube said the
party had not contributed in any way whatsoever to the delay in electoral
petitions being set down.

"We have not contributed to the delay at all," said Ncube. "We have done our
part. There has been a miscarriage of justice in the election petitions.
Imagine petitions lodged five years ago are still to be heard when the next
election is due in two months time and MPs will be completing their terms of
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Zim Independent

Food shortages begin to bite
Staff Writer
FOOD security is declining in traditionally dry Masvingo, the Midlands and
Matabeleland provinces and Zimbabwe will not benefit from food handouts in
the lean months from January to March this year, the World Food Programme
(WFP) has said.

In its first report for 2005 titled the WFP Emergency Report, the UN food
agency said food security was declining in most districts of Zimbabwe but
the worst affected areas are Masvingo and Matabeleland North and South

"As the lean season begins, increasing levels of food insecurity are
apparent. Food security is declining in most of the districts, particularly
in those in the traditionally dry Masvingo and Matabeleland provinces in the
south of the country," reads the report.

The WFP said the increasing costs of food were contributing to food

"A massive price increase of up to 250% in the Masvingo urban market has
occurred since the post-harvest low point and household food purchases are
constrained by the increasing food prices and lack of income, with a wage
well below what is needed to purchase a day's cereal requirement," the
report says.

The WFP was ordered by the Zimbabwean government to cease all food handouts
amidst claims that the country had a bumper harvest last season.

Press reports last week indicated that maize meal, the country's staple
food, was in short supply throughout the country.

Government said last year that the country would not need any food aid
claiming it was anticipating a bumper harvest of 2,4 million tonnes of
maize. President Robert Mugabe repeated the same claims in an interview with
Britain's Sky News, saying donors should take their food to hungrier places.

However, the WFP has announced that it will continue with targeted feeding
of vulnerable groups such as the elderly and HIV/Aids victims.

In December, according to the report, the WFP provided about 25 000 tonnes
of food to over 1,6 million vulnerable people in 33 of Zimbabwe's 57
districts in what it described as a "one-off" distribution.

Zimbabwe is not included in a list of countries named in the report to
benefit from the its feeding programme.

Meanwhile, the Famine Early Warning System (Fewsnet) says the cost of living
in urban areas has increased steadily over 2004 and that the majority of
urban households are struggling to meet requirements.

"High inflation and the Grain Marketing Board monopoly over marketing maize
are exacerbating the situation," said Fewsnet.

Fewsnet said the cost of food and other non-food items increased by over 92%
last year while wages have failed to keep up.
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Zim Independent

Harare Commission jumps the gun
Staff Writer
HARARE'S newly appointed commission has started implementing parts of the
city's draft 2005 budget without presenting it to stakeholders first or to
the parent ministry for approval.

The hiking of vehicle licence, vending and other charges this week without
prior notification to the public sparked a serious row between residents and
the local authority. Vehicle licences went up by over 1 000% while vending
fees were raised 10-fold last week.

The licence fee for a light motor vehicle, for instance, which previously
cost $16 000 for a four-month term, now costs $184 000 while the annual fee
rose from $48 000 to $552 000.

Heavy vehicles which were previously licensed at $65 605 per term have now
seen their cost shoot up to $700 000.

Officials in the city treasury department confirmed that council had started
effecting the 2005 budget proposals on miscellaneous charges.

"Sections in which the budget proposals have been effected do not normally
go through the budgeting process," an official said. "These are small
charges which fall under the 25A schedule of the budgeting process. These
charges are reviewed each year and are subject to full council approval," he

Residents who spoke to the Zimbabwe Independent however said under normal
circumstances a budget should be implemented in its totality after going
through the budget formulation process.

The process involves stakeholder consultations, budget presentation, a month
of advertising and taking responses, submission to the minister for approval
and then implementation.

By the end of October each year all local authorities are expected to submit
their budgets to the ministry for approval, but up to now Harare has not
presented its budget to stakeholders because of problems caused by
government interference in council affairs. The delays will prejudice the
cash-strapped city of billions of dollars in uncollected revenue.

Combined Harare Residents Association chairman Mike Davies said the
increases were unsanctioned and called on the residents to ignore them.

"Noone has been consulted on these increases," Davies said. "Even the
minister has not seen or approved the figures so there is no way residents
can conform to them." -
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Zim Independent

Pitfalls of unguided indigenisation

Chris Goko

ZIMBABWE'S economic empowerment exercise, an often-contentious issue, has
flip-flopped about a decade after it was set in motion by Africa Resources
Ltd (ARL)'s acquisition of southern Shabanie-Mashava asbestos mines from
Turner & Newall.

As the country hurtles towards its 25th independence anniversary in April,
debate over the successes and failure of this nascent, but crucial
dispensation has once again surfaced on the back of continual failures in
banking, mainly indigenous-owned entities.

Ironically, the country's financial sector is one of the areas in which
local businesspersons had seemingly excelled in the wake of deregulation of
the industry by government in the mid-90s.
However, ugly charges of corruption have wracked the element of growth and
success, with a number of founding shareholders of banks fleeing to foreign
lands and some landing in jail.
And in the midst of mounting fears that Reserve Bank of Zimbabwe (RBZ)
governor Gideon Gono could be pursuing re-nationalisation of business, a
closer analysis of the latest CFX Bank failure would provide evidence to
assertions that a great deal of empowerment deals hinged on weak and
patronage frameworks. There is justification in the CFX case to say some
indigenous business owners were excessively greedy - by duping fellow
Zimbabweans - and seemed to apply the unwritten principle that commerce,
unlike government, has no obligation, not even moral, to apply best practice
in earning money.

It is in that context of blighted black economic empowerment, that sections
of Zimbabwe's populace is delighted at the government-instigated banking
shakeout, which it believes is the onset of fairness and restoration of
prudent business conduct. A panicky minority, meanwhile, sees the
anti-corruption crusade as an act of retribution by Gono and the government.

"One cannot expect the masses to admire economic empowerment and
wealth-accumulation that was brazenly done at their disadvantage, and
particularly huge amounts of money as in the CFX debacle," said an analyst
on Tuesday.
Part of the responsibility, he said, for the messy state of affairs in the
indigenisation drive lies with the entrepreneurs themselves who "bribed
their way into trouble".

With the feeling of victimisation, some politicians and bad corporate
elements have formed loose alliances, either railing against Gono for his
own weaknesses or citing legislation, which is devoid of distinct official
business functions and entrepreneurial concepts. Possible examples of
patronage economics range from the Shabanie state takeover to the on again,
off again platinum investments.

"Corrective measures in any form (in the Zimbabwean scenario) were always
bound to bring conflict that has to be settled by force and not entirely by
law," added the analyst.
"It is dicey to look into history and perhaps one area, which required that
element of scrutiny is the financial sector's licensing regime.
"And in lieu of politicians hobnobbing with businesspeople, it is least
surprising that the premise of Gono's reform has been subjectively
interpreted as a vengeful ploy to deliver private entities such as Shabanie
and several banks into government-friendly hands. It compounds public
sentiment," he said. By implication, the analyst noted, government was also
responsible for the chaos in indigenisation and its impact on economic

While there may seem to be a preoccupation with banking whenever economic
empowerment debate arises in Zimbabwe, its influence and that of big
business on national development, and policies cannot be overemphasised.

It can also be noted that there is no other sector which witnessed such
phenomenal growth or marked black-ownership as the financial sector.
In terms of manufacturing industry, there were no real big empowerment deals
until five or six years ago when consortia - still linked to several
indigenous banks - took over Murray & Roberts, Tedco, Tobacco Sales Floor,
Zimbabwe Sugar Refineries and Zimplow to mention a few.
There are allegations that the business grouping received concessionary
loans from indigenous banks to buy shareholding in listed companies. Some
financial institutions which have closed shop were weighed down by
non-performing loans advanced to cronies.

Some indigenous groups have gone a step further by buying into resource
companies and these include Garmony Investments, which until recently had an
interest in coal miner Hwange Colliery Company.

The most apt case of local empowerment groups which bought into mining
involves Douglas Munatsi and Oliver Chidawu - key players at African Banking
Corporation and investors in northern Zimbabwe nickel company Bindura Nickel
Corporation. They form part of a broad pan-African investment company which
took up resources titan Anglo American Corporation (Anglo)'s 52% stake in
the local mining company.

Another black group, Mwana Africa consortium, led by Democratic Republic of
Congo national Kalaa Mpinga, also made a huge statement when it bought into
bullion producer Freda Rebecca, formerly owned by Ashanti of Ghana.
But surface analysis would conclude that Zimbabwe's empowerment drive is
fairly advanced, yet broadly it may turn out to be what South African
President Thabo Mbeki calls "narrow empowerment" because only a few liquid
individuals are benefiting from these empowerment initiatives.

Mbeki, a zealous pan-African and empowerment activist who is quite eager to
improve his kinsmen's lives, has been puzzled by Pretoria's current economic
empowerment model, dominated by Cyril Ramaphosa, Mzi Khumalo, Saki Macozoma,
Tokyo Sexwale and lately Patrice Motsepe.
It is also in that vein the SA president, an idealist with a penchant for
new dispensations such as the New Partnership for Africa's Development, has
sought to redraw the empowerment issue, saying the gains of SA's empowerment
process - carried out in just under 10 years - have not been filtering
through to the "second economy".
According to him, the second economy is the masses, who should benefit from
mining and other big empowerment deals as well.
It is, therefore, in that spirit that Mbeki's government has not been so
keen on former top civil servant Andile Ngcaba's 7 billion rand takeover of
Thintana's 15% stake in State-owned Telkom.

His rationale is that it is not only improper for five or seven people to
benefit from the disposal of a key national asset, but also grey in that the
financing is coming from the Public Investments Commission, pooling
government pensions and other state-company earnings. Just as the Zimbabwe
government had initially ruled on the 15% Zimbabwe Platinum Mines Ltd
(Zimplats) empowerment subscription that it be taken by the National
Investment Trust (NIT), SA is arguing that it would be more beneficial if
broadly-based groups such as the Women's Investment Portfolio - also
interested in the Telkom share - were to take centre stage.
In essence, what Zimbabwe had done and now Mbeki, is a realisation that
unguided empowerment, in other words enrichment of a few, has serious future
implications and horrors reminiscent of the privatisation saga in modern-day
Russia, where President Vladimir Putin is deposing oligarchs who acquired
state assets for a song.

Zimbabwe has its fair share of examples similar to the Ngcaba/Telkom saga,
where a connected few looted National Social Security Authority funds to buy
private businesses and others covertly wriggled into public enterprises and
asserted their authority under the guise of empowerment.
Had former Finance minister Simba Makoni not kept his head, Harare could
have lost the profitable Astra Holdings group to narrow empowerment groups,
particularly UkubambanaKubatana Investments.

Chemist Siziba, a founder of the Indigenous Business Development Centre
(IBDC), says empowerment milestones in Zimbabwe have been posted and
enhanced by good education and skills base, but material gain and
achievement has suffered due to a number of reasons. An arch opponent of
privatisation, Siziba says selfishness on the part of some individuals and
those who should facilitate ample growth of locally-owned businesses and
enterprise had eaten up the noble ideas of economic empowerment. The former
Cosmos boss says it would be imperative for Zimbabwe to look across to
Botswana, where state corporations efficiently mine key natural resources
such as diamonds with competent partners such as De Beers and the proceeds
from such operations ploughed into community projects.

Siziba, who emphasises that most indigenous projects were born out of
individual effort and not state benevolence, says the NIT/Zimplats
arrangement was "more than correct" to preserve natural resources and,
therefore, the RBZ's suggested reluctance to okay little-known
NkululekoRusununguko's 15% bid for the platinum miner falls within that

He feels the biggest letdown in Zimbabwe's and indeed, the broader global
platform's empowerment policies is licensed business, which he said is
subject to bribery and manoeuvring.
While there is an evident clash of ideologies between private business
interests and regulatory authority advisors, many see everything wrong in
cosmetic empowerment enabled through "selections of partners" as is the case
with Khumalo's 30% offer of Metallon Gold to Manyame Consortium, Motsepe's
mony investment and Ramaphosa's buy into former Anglo companies.

A revisit of Khumalo's 30% sale would show that he sold the stake for US$9
million and put in a clause where John Mkushi's group would perpetually
forfeit its dividends to make up for the US$8 million shortfall from its
minute down payment.

Again, Zimbabwean indigenous consortia's 15% buy into Zimplats was crafted
in such a way that funders, in the form of Amalgamated Bank of South Africa
and Stanbic Bank, would hold up to two-thirds of the shares on condition
that they would release the "entire scrip allotment" upon full payment of
the US$45 million loan.
It is known, in the meantime, that loan repayment would hinge on company
performance and issues such as dynamism in the global economy.
It would make sense, therefore, that empowerment be seen in the model of big
corporations such as Anglo expanding their outsourcing initiatives, as
opposed to window-dressing equity partnership. Inevitably, what passes for
"good and celebrated empowerment deals" in Zimbabwe and elsewhere in Africa
may turn out to be less than that.
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Zim Independent

Mukanya roars at last
Darlington Majonga
HE has always been sharp-tongued in his criticism of the political and
social ills in Zimbabwe, but never before has he bluntly challenged the
status quo. But Chimurenga music master Thomas Mapfumo himself says his
latest release Zvichapera is only an appetiser for the "bomb" he has already

The long-awaited Zvichapera finally hit the market this week after failing
to materialise before Christmas owing to a tight schedule at Gramma Records.

The new album was initially pencilled in for release in January 2004, but
the recorded material mysteriously vanished from the studio. A second
attempt to release the album hit another snag as gremlins were at work once
again at the recording studio.

This time round the Chimurenga music guru has roared, giving his legion of
fans what he terms a belated Christmas present.

Zvichapera contains six raw songs of the 11 Mapfumo had intended to record
before the studio mishap. Four other tracks on the new effort, including the
title track, were plucked from previously recorded albums "in memory of our
departed colleagues who took part in those recordings".

Very few need introduction to Masoja Nemapurisa, a warning to a ruler who
uses the police and military force to entrench his rule against the will of
the people. Mukanya's fans are also likely to be familiar with the candid
Nguveni as the two tracks were "pre-empted" when the album Chaputika was
controversially recorded at a live show in the United Kingdom and released
without Mapfumo's prior permission.

But if Mukanya says the studio versions of the two tracks are "raw", the
veteran musician is not waning as yet. The "politically pregnant" songs
exude the touch of genius that every music lover would dare not miss.

"It's amazing, just when you think Mukanya won't surpass his previous
release, he keeps getting better with age like wine," quipped Cuthbert
Chiromo, Mapfumo's replication manager. "The wait for Zvichapera is finally
over and it's there for the people to judge for themselves."

New hit Uchaenda Wega is likely to make waves as much as Ruvengo. In

the former Mukanya reminds the leaders that they will face the music on
their own when the day of reckoning comes, while the latter is a strong
message encouraging racial harmony, peace and love.

Huya Tiherende is another track likely to become a favourite among
Chimurenga fans, while Mapfumo departs from his usual political messages in
Mama Thembile, a love song that could be the peak song on the album.
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Zim Independent


Yes, Your Honour, but .

WE share Chief Justice Godfrey Chidyausiku's view that the judiciary risks
the loss of public confidence "unless we live up to the generally accepted
universal standards of judicial conduct". We also share his worry that the
current state of affairs in the judiciary provides "ominous signs that can
only be ignored at our own peril".
We however differ with the country's highest jurist on the epicentre of
discord in our judiciary. Opening the 2005 legal year on Monday, Chidyausiku
noted with grave concern "corruption" in the judiciary. Reports in the state
media said he singled out the cases of Bindura magistrate Mark Taruona and
Justice Benjamin Paradza as reflecting "extremely disturbing developments"
in the judiciary.

While Taruona has been tried by the courts, Paradza's case is still pending.
He has not been found guilty by any court and, in any case, he is contesting
the allegations that he tried to influence fellow members on the bench to
decide in favour of a business partner.
But statements by the Herald appear to suggest that the courts have already
found against Paradza.

Judges are not above the law. When they err, they should be subjected to the
law and receive a fair trial. But an accused judge, or indeed any member of
the public, cannot be tried outside the court. It is a basic tenet of law
that one is innocent until proven guilty.
Chidyausiku is conscious of the need to foster public trust. To achieve
that, it is imperative that the judiciary is not seen as politically
compromised. This observation has been confirmed by observer missions,
including the United Nations rapporteur on Zimbabwe and the African
Commission on Human and People's Rights.
A mission from the ACHPR noted that the judiciary was not free from
political interference.
"The mission was struck by the observation that the judiciary had been
tainted and bears the distrust that comes from the prevailing political
conditions," its report said. "It appears that their conditions of service
do not protect them from political pressure; appointments to the bench
should be done in such a way that they (are) insulated from the stigma of
political patronage," it said.

Chidyausiku promised the same mission that a code of ethics for the
judiciary was being drafted. Two years down the line the Ministry of Justice
has not produced one.

To the general public, it appears the judiciary has consistently failed to
uphold constitutional liberties, which are constantly under threat from
President Mugabe's government. Charges of misconduct against judicial
officers do threaten the integrity and standing of the court. But this pales
when compared to the damage the reputation of our jurists has suffered as a
result of international condemnation of the bench arising from its handling
of land-based litigation, electoral petitions and legal challenges to
repressive legislation, especially the Access to Information and Protection
of Privacy Act.

Where civil liberties are under threat the public looks to the judiciary for
protection. It is therefore important that the judiciary is not seen to
condone serious human rights abuses. There have been incidents of torture of
suspects, abductions, and lengthy detentions without trial. To all intents
and purposes, such victims of state abuse have not always found relief from
a supine judiciary.

Our politicians would argue that the judiciary should be relevant to the
prevailing political environment. But that is different from subservience to
the state at the expense of justice.

Judges today work in an age when the world has come to cherish universal
human rights. The world will condemn not only those committing serious
human-rights abuses but also all those who condone or try to conceal these.
We recall in 1999 submissions by lawyer Jeremy Callow that police assaulted
three Americans arrested at Harare international airport as they tried to
smuggle guns out of the country. Callow said police applied electric shocks
to their genitals while they were in custody.

The High Court acknowledged evidence that the suspects had been tortured
while in police custody. In sentencing the Americans in 1999, the High Court
said the evidence of torture constituted "special circumstances" for not
imposing more severe sentences. The court sentenced the three men to six
months in prison.
The state appealed against the sentence in 2001, although the men had
already served their terms and left the country, saying the High Court
should have given them a longer prison term. The state's application was
granted by the Supreme Court and the sentence was increased. Lawyers were
quick to point out at the time that the Supreme Court verdict was tantamount
to condoning the torture of suspects.

Judges must therefore understand the importance of human rights, not just to
our dignity and economy but to the dignity of the court. Allegations of
torture of prisoners and detained suspects have been on the increase in the
past five years. There have been suspicious deaths, too.

As guardians of all our civil liberties and liberty itself, they will be
watched - and judged.
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Zim Independent

Eric Bloch Column

The future of Zimbabwean tourism
TOURIST arrivals in Zimbabwe grew almost ten-fold between 1990 and 1997, but
since 2000 have declined to near 1990 levels. Very rightly, in seeking
significant recovery for Zimbabwe's very distressed economy, government has
recognised that tourism could be a very substantial element of that

Tourism provides more employment world-wide than any other economic
activity. It is a major generator of foreign exchange for numerous
countries, and the innumerable inputs required by the tourism sector weave
an array of tentacles into almost all other economic sectors.
Tantalised by the spectacle of possible great numbers of employment
opportunities, of inflows of greatly needed foreign exchange, and of
substantive downstream economic activity, government's interest in
stimulating a major upturn in tourism is not surprising. It is with that in
view that the Minister of Environment and Tourism, Francis Nhema, will
shortly be presenting a proposed national tourism policy and master plan to
the cabinet that is intended to "harmonise" activities within the tourism
It is undeniable that Zimbabwe could have a thriving tourism sector, for it
is richly endowed with much that is sought by the international tourist.

The incomparable Victoria Falls is justly considered to be one of the seven
natural wonders of the world. The grandeur of the Matopos Hills has inspired
most who have had the good fortune to frequent them. Despite the disgraceful
debilitation of the wildlife resource by unrestrained poaching, nevertheless
Hwange National Park, Gonarezhou, Matusadona and various conservancies
compare favourably with the renowned wildlife reserves of Kenya, South
Africa, Botswana and elsewhere.
The mystique of Great Zimbabwe and of the Khami Ruins continues to impress
and intrigue, and the beauty of the Vumba, Nyanga and Chimanimani is
spectacular, whilst the opportunities of game-viewing against the background
of the almost indescribably sensational African sunsets at Kariba exceed the
expectations and desires of almost all who are privileged to experience
them. Supplementing these gifts of nature, Zimbabwe has many hotels, lodges,
safari camps and other tourism accommodation of internationally recognised
high standard.

With so much to offer, one must ponder what has caused the massive decline
in tourist arrivals in Zimbabwe in recent years, and what is necessary to
reverse that decline. Unless the evaluation as to the causes of the reversal
of Zimbabwe's former position as an increasingly popular tourist destination
has been realistically carried out, the master plan will not provide a road
map to a touristic upturn. Hopefully, that evaluation was a constructive
one, for in formulating the proposed national tourism policy and master
plan, the ministry has to some extent consulted and interacted with
stakeholders within the tourism sector.

However, one must justifiably fear that the principal causes for the
downturn in tourism will not have been identified or, if recognised, not
acknowledged. Such a fear is well founded, for "leaks" as to the contents of
the master plan suggest that the key focus is upon marketing initiatives,
human resource development, product pricing, infrastructure development and
upon countering negative media reports. It cannot be denied that all of
these are very important factors, but there are some that are of even
greater importance.

Amongst the most critically to be addressed must be restoration of law and
order, for one of the greatest deterrents to successful promotion of
Zimbabwean tourism is the very considerable deterioration in the law and
order environment. Potential tourists from almost all parts of the world are
very conscious of the increased numbers of car-jackings and armed robberies
of recent years, bag-snatching and pick-pocketing incidents, and the extent
to which they can be subjected to corrupt demands for so-called "spot fines"
for spuriously alleged traffic offences.
The perceptions of the breakdown in law and order have been exacerbated
(with much justification) by the pronounced reluctance of Zimbabwe's law
enforcement agencies to deal with unlawful settlers on farmlands, with those
who have vandalised farm properties and expropriated crops, and equipment,
of displaced farmers. Equally, the incarceration of people for months on end
without bringing them to trial, the demonisation of political opponents and
victimisation of many critics, and the promulgation of oppressive
legislation against the media and against non-governmental organisations
does not vest possible visitors to Zimbabwe with a sense of security. Nor
does the expropriation of conservancies in breach of international bilateral

There is no doubt that Zimbabwe has suffered very negative press
internationally and that is compounded by the wide-ranging "word-of-mouth"
adverse reflections of Zimbabwe, but Zimbabwe needs to realise that much of
it is self-provoked, for Zimbabwe's politicians in general, and those in
governmental hierarchy in particular, readily and continuously provide the
material upon which much of the negativeness is based. And, as scathingly as
Zimbabwe berates the international media for its frequent negative
commentary on Zimbabwe, government, and the media controlled by it, have no
hesitation in never-endingly making negative and derogatory attacks upon the
very countries from which Zimbabwe wishes to attract tourists.

It is not only at the media and political levels that Zimbabwe needs a
"make-over" if it wishes to attract tourists in large numbers. There are far
too many occasions when tourists have found their arrival at Zimbabwean
border posts most unwelcoming. Countless reports claim inordinately
prolonged waits for immigration and customs processing, culminating in
sullen receptions from officials, followed by aggressive road-blocks and
repeated searches. That is certainly not the welcoming environment that most
tourists wish for!

However, it will be pleasing if, as has been indicated, the master plan is
going to address infrastructural issues. Some very positive developments are
already in progress, including the extensive upgrading of Bulawayo's
airport, that which is intended for Victoria Falls, and the very
satisfactory Harare International Airport.
However, good airports serve little purpose if there are not adequate air
services. For some years Air Zimbabwe's reputation for punctuality has been
abysmal, with numerous flights being delayed for many hours, to the great
inconvenience of passengers.

Especially lacking for any restoration of past volumes of tourists is the
provision of flights to Kariba and to Hwange National Park, and direct
flights between Harare and Victoria Falls, whilst the national airline also
gives very limited service, to Bulawayo from points outside Zimbabwe.
If, as anticipated, the proposed national tourism policy and the master plan
do address promotion of tourism constructively, it will be a definite step
in the right direction. But it will not suffice unless it is complemented by
greatly overdue political actions and policy changes.
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Zim Independent


Overstaffed, underworked and overpaid
MUCKRAKER was intrigued by comments in this week's Scrutator column in the
Sunday Mirror. It was about the lessons to be drawn from academics dabbling
in politics.
"The most obvious one in post-independent Africa is that you can so easily
lose your soul as an intellectual in the pursuit of politics, and not
unusually former academics can become the most intolerant and dictatorial,"
Scrutator said. "Simply because they are always so sure and confident of the
rightness of their cause as to be disdainful and oblivious of the views of
We are surprised that Scrutator, whose views are thought to reflect those of
the Sunday Mirror's proprietor, could be so brutally honest in his

Having said that, it was good to see another Sunday Mirror columnist, Behind
the Words, dealing robustly with the pretensions of officers in the Office
of the President who are unable to distinguish in their professional duties
between party and state. The writer referred to personalities who have used
government institutions for the pursuit of their personal and political

"We refer here also to the unacceptable practice whereby minister and
permanent secretary variously assumed the roles of publishers (of
Zimpapers), editor-in-chiefs (of Zimpapers, ZBH etc) and columnists beyond
the control of the editors themselves," Beyond the Words said.
"Needless to add, if minister and permanent secretary want to get embroiled
personally in media altercations, and thereby confusing the role of
oversight (of the media) with hands-on involvement, then they have only
themselves to blame when their persons come under direct attack."

This is all in response to complaints by Herald columnist Nathaniel Manheru
about conflating Jonathan Moyo and the state.
This is not difficult to do, Beyond the Words justifiably points out.

A structural problem of a similar sort emerged last week when the Department
of Information in the Office of the President called on the media to limit
coverage of the ongoing trial of persons charged with contravening the
Official Secrets Act.
It referred to "incriminating and defamatory" articles about individuals who
include government ministers which were "contrary to the requirements of the
law and good government".
"Government notes, with concern, falsehoods on the case, some of which have
been posted on websites associated with the opposition."
There you have a partisan claim which is not substantiated by any facts.
Speculation about the involvement of government ministers first appeared in
the Sunday Mail which is not usually associated with the opposition.

Furthermore, for good measure there is the claim that MDC MPs "who have
links with foreign powers" were also under investigation.
This came not from the attorney-general's office but Herald "sources" in the
same article as the Department of Information warning.
It would be useful to know which MDC MPs have access to state secrets and
are bound by the Official Secrets Act!

Whatever the case, the Office of the President is not a disinterested party
in all this. Its officers have been reported as detaining individuals
without affording them access to their lawyers. That is a breach of
constitutional rights that remains unanswered.

When the ministers for State Security and Home Affairs were asked by this
newspaper to comment on the detentions in late December, they claimed not to
know anything about the matter.
Government has not kept the public informed of developments despite the
Department of Information's claim that it is "striving" to do so. It has
actually tried to hide the matter from the public by preventing its media
from reporting on it for over two weeks from December 16 to December 30. As
it involves personalities in the news it is a matter of legitimate public
interest. Especially when the government has accused the opposition of
working for the British!
Newspapers cannot therefore accept lectures from self-interested sources
about what is legal or ethical. We are mindful of the way the Cain Nkala
case was conducted and the investigative/legal cooking that Justice Mungwira
complained of there. The duty of the media is to compare what facts are
available against what "national interest" the state claims to be performing
and allow the public to judge any discrepancies that may emerge.

Muckraker was surprised by Vice-President Joseph Msika's remarks made at
Ruth Chinamano's funeral about "pitched battles with Rhodesians" in the
streets of Highfield where the Chinamanos lived.
Msika was around then so he should know better. Yes there were "pitched
battles" in the streets of Highfield. But they were not with the Rhodesians.
They were between Zanu and Zapu. The Rhodesians stood by and watched as
homes were petrol-bombed and bones broken following the split of August

The Chinamanos remained loyal to what they saw as the authentic nationalist
party. Needless to say, none of that came out in Msika's speech.
Instead we had the airbrushed version. Msika also omitted to mention the
shocking conditions to which Josiah Chinamano's widow had been allowed to
sink in the last years of her life. Congratulations to the Sunday Mirror for
exposing that. It put all the fine speeches in some sort of perspective. But
Msika did manage to settle a few scores that have obviously been troubling
him of late. He lashed out at the mafikizolos who were jumping on the
bandwagon of leadership. Those aspiring to lead should be respectful of
their seniors, he said. "What we have recently observed shows lack of
direction." The net had closed in on a few culprits, Msika said, evidently
with some satisfaction. The Kondozi gang must be ruing the day they said
there would be "no going back".

Talking of airbrushing history, if you see anything with the Silver Jubilee
emblem plastered on it in the state media, beware. It is pure propaganda.
Here's an example from the Business Herald: "Thanks to the liberation
struggle and Unity Accord, Zimbabwe now enjoys unprecedented economic growth
and political stability. The country, unlike its predecessor, Rhodesia, is
no longer a pariah state." That's unprecedented GDP growth of minus 9% in
2003 and minus 5% last year is it? And President Mugabe and his ministers
can travel anywhere can they?

The departure from the Commonwealth was not, as the Herald claims, in
defence of national sovereignty, but resulted from a point-blank refusal to
adhere to the terms of the Harare Declaration. Earlier we had this revealing
statement: "Zimbabwe now boasts over 10 universities.We now have so many
engineers, medical doctors, economists and accountants produced by the local

In case you can't see any of them, the Herald's business writer had an
explanation: they had been "lured by our erstwhile colonisers".
The paper concludes this entirely delusional piece by claiming that, as the
"icing on the cake" of the jubilee, those coming out of school no longer
have to confine themselves to a career in nursing or teaching, as in
colonial days. "Now they can get jobs in any field."

Really? Still with Silver Jubilee propaganda, if the "before" picture of
Harare in 1978 looks better than the one taken "today", even though the
earlier one is in black and white, wouldn't it be a better idea to use the
"before" one as the "after" and the "after" as the "before"?
It is also a good idea when using "before" and "after" shots to make sure
the view is the same. The "before" one was taken from the air, the "after"
one from the Kopje.

We are delighted to see Olivia Muchena looking so well-nourished. The last
time we saw her she was not quite so, well, expansive. She was featured in
the Sunday Mail this week as due to open a food fair.

Looking as though she already had, Muchena said the fair was designed to
promote a diversified diet. The event could soon find itself on our national
tourism calendar, she predicted.
Now would that be before or after Miss Tourism World whose contestants look
as though they could do with a square meal?

Harare city council workers are not happy with their employer because of
poor wages, we are told. Harare workers' council chairman Cosmos Bungu says
he is striving to have the lowest-paid workers get a salary of above $1,8
million. The council failed to award them three wage increments last year,
he complained.
Are these the same council workers who are virtually invisible around the
city; the ones who haven't been cutting grass verges, removing litter, or in
fact doing anything at all to keep the city looking clean? The Harare city
council workers union has reportedly been linked to Zanu PF. The city's
workforce is overstaffed, underworked and overpaid.

Why doesn't Cde Bungu agree on a performance-related contract for workers?
How can he demand better pay when the city has never looked so filthy? The
complete absence of a culture of supervision and maintenance in the upper
echelons of council is also part of the problem.
What is Sekesai Makwavarara actually doing apart from enjoying the perks of

Cephas Chimedza's parents must be one happy lot for bringing up an exemplary
son. According to the Saturday Herald, Cephas was brought up in "a strict
Christian family" and spent his childhood in a police camp. What is his
favourite drink? A Zambezi lager is the answer.

"I like Mutangadura (a favourite boozer's hideout) or the Village in Murehwa
but dislike my favourite hangout at one lake in Harare because I am
hydrophobic," confessed Chimedza.
Could the drinking be a form of protest against this strict Christian
family? And how do you "dislike" your "favourite hangout"?

Government has set up the "Zimbabwe Tsunami Disaster Fund" to mobilise
resourses to alleviate the suffering of those hit by the tsunami in
south-east Asia and parts of Africa, the Herald reported on Tuesday.

Members of the committee to spearhead this "national effort" have been drawn
from the private sector, government and churches. President Robert Mugabe
has been chosen to "lead the whole effort as patron of the fund".
According to the Herald, the idea is to raise a staggering $20 billion to
help mainly Indonesia as the most affected country. We don't want to sound
heartless towards the people affected but Muckraker finds this whole
"national effort" extremely cynical and hypocritical. Thousands of people
face imminent starvation in Zimbabwe and yet government wants to raise $20
billion for Indonesia while denying reports released by the Bulawayo city
council that people have succumbed to food shortages in the city.

Since before Christmas many shops have been without mealie-meal around the
country. In fact organisations such as Care International and the Red
Crescent Society are having to rely on donations to feed starving villagers
while the government remains in denial about falling agricultural

Let's face it, people are facing serious food shortages from Mount Darwin in
the north to Beitbridge in the south and yet government conveniently hides
this fact because of the forthcoming election. And it doesn't look like a
good rainy season despite claims that we are not going to be affected by the
El Niño phenomenon.
If anything, if Zimbabwe can raise $20 billion for Indonesia, it needs even
more to feed its own people in the coming months because donors will be
focusing their attention on Asia. Charity must begin at home and church
leaders involved in the "tsunami fund" should be telling government this
elementary Christian message.
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Zim Independent

Tourism facilities to be regraded

ZIMBABWE'S tourism facilities will now be re-graded under a new statutory
instrument that has been drafted by the Ministry of Environment and Tourism
and the Zimbabwe Tourism Authority (ZTA).

Tourism minister Francis Nhema yesterday confirmed that there was a new
grading system ready for release and use by stakeholders. A reputable
consultant company was hired to design the new system.

The statutory instrument will replace the old one which has been in use
since 1980.

Nhema said: "I am waiting for the new statutory instrument which is
currently with the printers which authorises us to grade tourism amenities
such as lodges to meet international standards."

The move has stalled the downgrading of some hotels as mooted by the
Zimbabwe Tourism Authority in a document leaked to businessdigest last

The ZTA had made plans to downgrade hotels belonging to three listed
companies - Zimsun Leisure Group (Zimsun), Rainbow Tourism Group (RTG) and
TA Holdings (TA).

The five-star Crowne Plaza Monomatapa, owned by Zimsun, and RTG's Ambassador
Hotel were among the hotels to face re-ratings. Jameson Hotel, owned by TA
Holdings was also expected to lose a star.

Meanwhile, Nhema reportedly quizzed ZTA officials over the document leaked
to businessdigest on the planned re-rating of some hotel establishments.

The minister was said to oppose the re-rating exercise, sources say.

The hoteliers are said to have expressed outrage at the contents of ZTA's
document which they said were detrimental to their businesses.

"We expressed shock at the contents of the document and we approached the
ZTA people for an explanation. They have since apologised to the affected
hotel groups for leaking the document to the media before consulting us,"
said one of the hotel officials who asked not to be named.

If the action had been taken, Crowne Plaza Monomatapa was likely to have its
five stars slashed to four, Jameson from four to three, and the Ambassador
Hotel from three to two.
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Zim Independent

ZABG not opening January
Shakeman Mugari
THE Zimbabwe Allied Banking Group (ZABG) will not be opening to the public
this month as planned, because there are crucial outstanding legal and
administrative issues which have not yet been completed.

In his third monetary policy review in October last year, Reserve Bank
governor Gideon Gono said the bank would open beginning January this year.

He also promised that small depositers with their money locked up in closed
banks would be paid before the school term begins.

The ZABG was expected to open this month. Creditors and depositors whose
investments are locked up in closed banks to be amalgamated under ZABG will
have to wait a little longer to access their funds, it emerged this week.

The Troubled Financial Institutions Resolution Bill, which seeks to regulate
the operations of ZABG, has not yet been signed into law by President Robert

This means that the legal framework for its formation has not been completed
making it impossible to open its doors to the stranded depositors. Even when
the Troubled Financial Institutions Resolution Bill becomes law there are
still some outstanding legal issues to be followed - a process that might
delay ZABG's start further than envisaged by the central bank.

This makes it impossible for ZABG to start operations this month as
initially planned. Legal experts say it might take weeks or months before
the bank could start.

At time of going to press the Bill has not yet been signed by Mugabe, but
its signing does not guarantee immediate permission for the government and
the central bank to open ZABG.

The Troubled Financial Institutions Resolution Bill, rushed through
parliament before the festive season, makes provisions for former directors
and shareholders to challenge the takeover of their banks by government.

Section 6 of the Bill requires that the individual banks be declared
"troubled" and this is supposed to be verified by the courts. The Reserve
Bank is then required to make an application to the High Court to confirm
the status of the bank.

The law requires that shareholders, creditors, and depositors be notified
and they are given 10 working days to respond or challenge the central bank
application. The law also demands that the central bank notifies former
directors who may choose to challenge the takeover. A High Court judge would
hear the challenges by the creditors, depositors, shareholders and former
directors before making a ruling on the confirmation.

Sternford Moyo, a senior partner with Scanlen & Holdness said the process
might take longer to complete. There are only 10 working days left this

"If the stakeholders choose to challenge the RBZ application to declare the
bank as 'troubled' then the process might take even longer," Moyo said.

"And remember a judge is under no obligation to make a ruling on the same
day and this makes the legal process for the formation of ZABG longer," said

"With those outstanding issues it is difficult to see how it could open this
month. The amalgamation of the banks themselves is a process."

He said if the shareholders, depositors, former directors and creditors
decide to challenge the takeover it might take more time for ZABG to come on
board. Legal process in Zimbabwe takes years to resolve.

Experts say that the legal battle between bank owners and the government

might spill over into the Supreme Court. There are chances that bank owners
might challenge the constitutionality of the Troubled Financial Institution
Resolution Bill.

This might stall the ZABG project. The Supreme Court has been accused of
being slow in delivering judgements on cases that deal with important
constitutional issues.

There are also concerns in the market that the ZABG is shrouded in secrecy,
which indicates that the central bank might have something to hide.

Jacob Mafume, a legal expert with Zimbabwe Lawyers for Human Rights (ZLHR),
said the silence by the monetary authority added to the uncertainty and
instability in the banking sector.

"The process is shrouded in secrecy as if it's an issue between the
government and the central bank only. Anyone owed money by a company is free
to apply for liquidation, they cannot take over just like that. The courts
are there for the creditors to seek redress."

He said there was no transparency in the way the bank is being formed.

"In fact no one knows how it would operate, yet the shareholders and the
depositors have a right to be informed about the fate of their assets and
money," said Mafume.
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Zim Independent

Air Zimbabwe boss keeps revival plan close to chest
Godfrey Marawanyika
THE newly appointed Air Zimbabwe managing director Tendai Mahachi is set to
unveil his turnaround plan to his board next week.

Mahachi this week confirmed that he was finalising his plan, which he
expects to change the flagging fortunes of the institution.

"I am still trying to put my bags down and meeting some people. I am
familiarising myself with the operations," he said.

"I will be submitting the turnaround plan to the board and other stake
holders next week, after which the plan will be made public."

The Air Zimbabwe board is chaired by Livingstone Gwata.

Mahachi refused to comment on how he intends to revive the national airline's
fortunes saying he needed a mandate from the board.

Mahachi takes over from Rambai Chingwena who left Air Zimbabwe in May last
year in as yet unexplained circumstances. Aviation expects have however
warned that unless Mahachi manages to shake off political interference at
the airline, he might find himself in the same pit as previous managing

"Everything hinges on what he submits to the board next week," a senior
official at Air Zimbabwe said. "If the board and the government agree to his
plan then he might be able to implement it with the assistance of other
senior personnel from Air Zimbabwe," officials said.

"There are serious problems at Air Zimbabwe like the unviable Harare-Far
East route which has to be addressed. The route is just being maintained for
political reasons," he said.

Currently, Air Zimbabwe is charging US$1 000 for a return ticket to China.
The payments can also be made using local currency.
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Zim Independent

NRZ pension hit by $12b debt
Godfrey Marawanyika
THE National Railways of Zimbabwe (NRZ) is battling to settle a $12 billion
debt which has ballooned over the past three years from actuarial services.
The parastatal is currently using the defined benefit scheme, which assures
a client access to his/her terminal benefits upon retirement. Other
organisations are using the defined contribution scheme.

The latter largely depends on the state of the funds and these are disbursed
subject to an evaluation.

Managing director of the NRZ Munesu Munodawafa confirmed that they have been
battling to service the debt but blamed their problems on the defined
benefit scheme.

"The problem is because of the defined benefit scheme we have been using.
The debt is at least $12 billion and has been accumulating because of
failure by the NRZ to service its actuarial deficit," he said.

"We are trying to address the problem and I think by the end of this year we
and the National Railways of Zimbabwe Contributory Pension Fund would have
come up with a position."

He said the NRZ was being generous to their employees as they were paying
22% towards the pension scheme per every employee instead of 15%.

"We are the only company I think that was using the defined benefit scheme
in the country. Together with the NRZ Contributory Pension Fund we hope to
have a solution by year end."

The pension contributory scheme currently has 9 500 members.

Munodawafa said a few employees were failing to get their pensions timeously
because of the debt crisis.

In May last year the workers took their employers to court after the NRZ
failed to pay a 25% cost of living adjustment it had initially awarded.

The Railway Artisans Union president Phibian Chenyika also confirmed the
problems pertaining to pensions.

"There is a problem of prioritisation of what the NRZ has to pay first," he

"One of the major problems we are facing is that of inter-parastatal debt,
which by the end of last year was $150 billion. Some of the institutions
that owe us money are the Zimbabwe Power Company and Zimbabwe Iron and Steel

He said a plan had since been put in place for the union and management to
make $1 billion monthly payments to offset the debt.

The Confederation of Zimbabwe Industries (CZI) has over the past two years
been seeking ways to mobilise resources for the repair of fast deteriorating
railways infrastructure.

CZI acting chief executive officer Farai Zizhou said discussions were
continuing with NRZ officials to find a lasting solution to the parastatal's
infrastructural problems.

"The discussions are still continuing. At this moment nothing has been done
beside agreeing to finance the refurbishment of rail wagons," he said.

Many industries that rely on the NRZ for transportation of goods have been
failing to move their various products because of logistical problems at the

This has mainly been attributable to the shortage of foreign currency to buy
spare parts to repair and service equipment, shortage of wagons and
locomotives as well as diesel fuel.
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Zim Independent

CFX top brass in forex scandal
Godfrey Marawanyika
SENIOR management officials from CFX Bank were purchasing foreign currency
using the bank's funds and not repaying the money, the Reserve Bank of
Zimbabwe (RBZ)'s internal audit report reveals.

The RBZ audit on CFX, carried out on December 26, said a management "cartel"
also used to preferentially award contracts for the supply of security
services to Peace Security, a company owned by the bank's human resources
director, Abel Mubango.

The supply of computer equipment to the bank was done by the head of retail
banking, Never Muzavazi, finance director Onias Ndlovu and managing director
Garainesu Shoko. Motor vehicles were supplied by Croco Motors, a company
owned by shareholder and non-executive director, Moses Chingwena.

The management cartel comprised the commercial bank's managing director,
finance director, IT manager, financial accountant, head of treasury, human
resources director and head of retail who were allegedly involved in
fraudulent activities and leading affluent lives.

Also implicated in the scandal is assistant accountant Calvin Mtombeni.

"In addition to (head of treasury) Mr Chamu Matsika's flashy lifestyle, the
former managing director, Garainesu Shoko, is reported to have built a
massive mansion in Mazvikadei resort area and is known to have been spending
extravagantly," the RBZ audit report said.

"The human resources director, Abel Mubango reportedly bought his Pajero
from the bank for an unbelievably paltry $1 million in early 2004."

The report said investigators had so far managed to extract sufficient
information to press criminal charges against Matsika who is said to have a
business partner in the United Kingdom, a "certain Lloyd Dube who sources
forex for him from Zimbabweans residing in the diaspora".

"In turn, Mr Matsika would then deposit the money that would have been
sourced by Mr Dube into accounts of the intended recipients in Zimbabwean
bank accounts, at the parallel market rate."

Mtombeni said that he had bought R429 610 on behalf of Matsika.

"Mr Mtombeni went on to indicate that he was expecting to buy R200 000 to
add to the initial amount. In response, Matsika indicated to Mtombeni that
he was expecting him to have raised R1 000 000 by Friday, 28 November 2003,"
the report said.

Matsika was this week fined $8 million or six months for illegally dealing
in foreign currency.

He was convicted on his own plea of guilty to a charge of contravening
exchange control regulations.

The RBZ placed CFX Merchant Bank, CFX Asset Management and CFX (commercial)
Bank under the management of a curator on December 17 after the bank was
found not to be in a sound financial position. Frank Kuipa was appointed

The purpose of the RBZ investigation was to determine the true position of
the bank in light of concealment of operating losses by management.

CFX management misrepresented the true condition of the bank by manipulating
the system-generated income to conceal accumulated losses of $115 billion.

The manipulated management accounts reflected an accumulated profit of $9

The bank also created a fictitious asset base of $49 billion, where a
foreign currency position of $72,7 billion was not backed by a corresponding
Zimbabwe dollar equivalent.

Investigations into former Century Bank have so far revealed that some of
the employees were put under pressure to produce fraudulent accounts.
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Zim Independent

Revitalising institutions of the state
Alex Tawanda Magaisa
IN last week's issue the Zimbabwe Independent published two powerful and
interesting articles. The first, by Beatrice Mtetwa focussed on the Attorney
General (AG)'s office in which she argued that in the last few years the
office has been complicit in the violation of human rights in Zimbabwe.

The second, by Denford Magora assessed the political landscape and argued
that the retention of power by Zanu PF does not necessarily signify its
strengths but instead the weakness of the opposition MDC party.

These articles prompted me to engage and make a contribution on this
interesting legal/political discourse. Although addressing different aspects
on the political landscape, the two contributions are bound by one theme
that I have previously discussed in this paper regarding the corporate
community, that is, the persistence of a regressive norm culture among the
significant stakeholders.

Mtetwa correctly identifies the constitutional basis of the office of the AG
and argues that it has largely failed to fulfil its constitutional mandate.
Indeed despite a plethora of laws and actions that appear to violate
fundamental freedoms, it would seem that the AG's office has not adequately
performed its role as the key adviser to government. As a practising lawyer
who is closely involved in the human rights litigation arena, Mtetwa is well
placed to share the lawyer's professional experience that, I gather from her
tone, is one of general frustration about the mechanics of the present legal

The question that must be asked is why, despite the existence of extensive
constitutional powers, has the office of the AG failed to meet the
legitimate expectations of citizens?

Indeed, if the legal powers are available but there is no enforcement the
problem does not lie on the law's doorstep, but on the conduct and behaviour
of the officers at the AG's chambers as determined by a normative culture
that promotes lethargy and inaction. One must explore further and question
whether officers operate in an environment in which they are capable of
making independent and fair decisions. It may be that the problem is that
the AG's office has been compromised in the same way that parts of the
judiciary have lost their independence. If that is the case, the new AG is
faced with the following conundrum: whether to allow the persistence of this
regressive norm culture or to initiate a new culture in which the laws and
powers available to his office are applied in order to promote fairness and
legality in the system. His ability to manoeuvre and assert his independence
will determine whether he can effect these changes. It is an opportunity to
recreate the image of the office and hopefully attract high quality
candidates to perform a role that is vital in law enforcement.

A chief element central to Mtetwa's concern and fundamental to effecting the
change in the norms is the principle of the rule of law. Although widely
used on the Zimbabwean political landscape, this concept is little
understood and to be sure, hard to define. In simple terms, it entails that
state power may only be exercised in accordance with laws properly enacted
in accordance with established procedures. Principally, it is aimed at
safe-guarding citizens against the arbitrary application of power. It is
characterised by among others such principles as the supremacy of the law,
restrictions on the use of discretionary power, principle of equality, etc.

Critics point to the limitation that while it focuses on the importance of
following procedures in enacting and applying laws, it does nothing to
properly define the content of the actual laws. Thus a dictatorial regime
can, as most often do, properly enact laws regardless of their inherent
injustice and still claim to be governing in terms of the rule of law.

Nonetheless, this gap is often covered by the existence, in most
constitutional democracies, of the Bill of Rights in the constitution, which
is the supreme law of the land. This enshrines the basic and fundamental
rights of citizens and serves as a standard against which the content of the
laws is measured. Thus the rule of law and the Bill of Rights ought to be
applied together if law- making and application is to comply with generally
accepted standards. In my view, that is where the AG's office has a crucial
role - to judge and advise not only whether the state is complying with
procedures of law enactment in parliament but also whether those laws are in
compliance with the Bill of Rights. To do otherwise would be tantamount to
an abdication of the constitutional mandate but also a violation of the
ethics of the legal professional. Ultimately, Mtetwa echoes the hopeful
sentiments of many members of the legal profession, by which they appeal to
the professional in Sobusa Gula-Ndebele and hope that perhaps at last the
respectable office of the AG can regain its status as it was known for many
years after Independence. We trust that it is not misplaced hope.

Magora is a regular contributor whose pieces I often look forward to
reading, not necessarily because I agree with his ideas, but for his
forthright and independent approach in the expression of his views. He
argues that Zanu PF is mistaken to believe that the MDC will fade because
its existence was necessitated by the former's failure to deliver on its
promises. When he compares the two major political parties he concludes that
they offer no viable choice. I share Magora's view that the weakness of
either party should not be considered as the strength of the other. This is
the mistake that has been made in many African countries struggling for
democracy - simply believing that a change in personnel is the harbinger of
the good times. As they discovered in Malawi post-Banda, Zambia post-Kaunda
and presently in Kenya post-Moi, it is the ability of the leadership and its
commitment to the people's will that makes a difference, not the change of

Again we return to the issue of the norm culture in government. Magora
correctly identifies that one of the major problems has been the failure of
the president's lieutenants to perform in office. One may also add that the
failure to change these non-performing ministers is also an additional
problem. Why then do ministers continue in office even if they fail to
discharge their duties and indeed when some make false public statements and
promises to the electorate? Why have we allowed a culture of corruption and
self-aggrandisement? It seems to me that merit and performance are not the
chief criteria but rather the politics of seniority and patronage. It is
necessary to move beyond that phase and utilise the collective ideas and
experience that the country has nurtured in both the public and private
sector over the years. Ministers ought to know that a cabinet post is not a
job for life and they are not irreplaceable. Unless the culture changes and
performance is made paramount, Zimbabwe will continue to spiral downwards.

At this point then one needs to consider whether the MDC itself has
demonstrated its commitment to fight this culture. In other words, does the
behaviour of the leadership demonstrate that they will not do exactly the
same things that Zanu PF is being accused of today? So much focus of the
pro-opposition movement and sympathetic press has been on the ruling party
that one wonders whether, as an organisation the MDC and other political
parties are totally free of the same handicaps. It is important to be
careful and to be vigilant towards the opposition as towards the ruling
party, otherwise as soon as they ascend to the echelons of power, the
country will have the same animal, as the Zambians, Malawians, etc later

One weakness of democratic movements is that opposition parties are formed
with the immediate goal of winning an upcoming election and when they fail,
they often lose momentum because they have short-term strategies. I have
always argued that parties like the MDC are in for a long fight - and when
they decide to engage in the politics of the state, they should expect the
possibility that they may remain in opposition for quite a while. The
experience of the former opposition (now in leadership) in Ghana, Kenya, etc
demonstrates that victory does not often come at the first attempt, no
matter how well the signs might portray.

The question therefore is whether, despite the initial set-backs, the
opposition is prepared and able to remain a viable political entity.
Although it may be frustrating, it also gives the electorate ample
opportunity to judge the viability of the persons that purport to represent
them. Conversely, it is also an opportunity for the MDC to demonstrate its
credentials for the long term. I would disagree with Magora on the assertion
that the MDC will remain in place as long as Zanu PF fails to deliver
because the viability and longevity of the MDC is not dependent on Zanu PF's
failures but on its own ability to survive the rigours of political

The great tests for the MDC leadership are whether the party can retain the
trust and confidence of the electorate or whether their popularity was
simply based on a temporary wave of discontent among the public.
Simultaneously, it offers an opportunity for Zanu PF to revitalise itself,
provided that it has the political will, and can demonstrate that it can
deliver after all. In the long term, Zimbabwe will need both Zanu PF and the
MDC or their equivalents, because the death of one may signal another
descent into one-party dictatorship.

*Alex Tawanda Magaisa is Baker & McKenzie lecturer in Corporate & Commercial
Law at the University of Nottingham. Contact: alex.magaisa@nottingham
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Zim Independent

Prospects for 2005: hope springs eternal
By Dzika Danha
AS the page turns on 2004, one of the worst years in the short history of
Zimbabwe, we attempt an economic prognosis for 2005.

Our focus starts on the prospects for economic growth in 2005. Following
seven years of declining gross domestic product (GDP), the total cumulative
contraction is estimated at 30%. However, growth of 1,8% is forecast for
this year by the IMF.

Following the imposition of the now well-documented monetary policy
statement in December 2003, the Reserve Bank of Zimbabwe (RBZ) has
essentially become the sole arbiter of the economic climate. We attempt
therefore to dissect the RBZ assumptions for recovery. The RBZ forecasts GDP
growth of 3%-5%.

The Zimbabwean economy remains heavily dependent on agriculture (16,5% of
GDP provides a third of foreign currency earnings). Accordingly, there has
been a concerted effort to divert resources to the sector. As of September
last year, 43,4% of the $2,057 trillion productive sector fund was directed
to agriculture. Consequently, the RBZ estimates the sector to grow by 28% in
the current year. Optimistic, to say the least, given the vast structural
changes experienced in the sector in recent times.

A prime example of this can be seen in the tobacco crop output, once the
foremost hard currency earner for the country. In recent years the number of
growers has increased from 7 192 in 1999 to 12 700 in 2004. Production
however has plummeted from 236,7 million kilogrammes in 2000 to 65 million
kilogrammes for the just ended season. This can be explained in part by the
land reform programme, which has seen a proliferation of smallholder farmers
who have been constrained by a lack of scale, secure property rights,
technical know-how and access to capital. Thus the unavailability of inputs,
which have been in erratic supply, hampered preparations for the 2004/2005
season in so doing dispelling the notion of a potential "bumper" harvest.
Consequently, the government's tobacco crop target of 160 million
kilogrammes will remain unattainable and a crop of even last season's size
will be a feat in itself. Another crop, once a preserve of large-scale
commercial farmers, wheat, has seen a precipitous decline in production. In
2004, wheat production was estimated at 110 000 tonnes, almost half of the
2002 crop. While maize production may rise from its current low base it is
generally acknowledged that a food deficit will persist.

Crops traditionally grown by communal farmers such as cotton, and sorghum
have largely been unaffected by the upheaval. In fact, cotton has overtaken
tobacco as the leading agricultural export earner and has seen positive real
growth in recent years. The just ended 2003/2004 season saw production at
330 000 tonnes compared with approximately 250 000 tonnes for the 2002/2003
season. Despite predictions of growth for the forthcoming season, earnings
will be hampered by poor international cotton lint prices.

Of concern is the continued plight of the manufacturing sector (18% of GDP
provides a third of foreign currency earnings), which even according to RBZ
estimates is expected to see output decline by 8,5%. The alarming
"de-industralisation" of the economy is an issue that needs the urgent
attention of the authorities. The sector's problems include escalating
costs, poor availability of foreign exchange for critical raw materials,
spare parts and capital equipment, as well as an unviable exchange rate
rendering exports uncompetitive. While some will note that the export
incentives now on offer can yield an effective rate of U$1:$7 130, it has to
be noted that this benefit tends to tilt towards the horticultural sector
where pre-payments are more easily obtained.

The mining sector's potential hinges on the continued development of the
platinum industry which, if looked after, could become the country's leading
foreign currency earner. Of concern has been the announcement of a series of
measures to regulate the platinum sector's mostly foreign controlled
companies in the governor's third quarter monetary policy review. Any
foreign direct investment is critical to the country's wellbeing and it is
imperative that investor's interests are looked after. At the last monetary
policy review the RBZ governor adjusted the gold support price to $92 000 a
kg implying an exchange rate of $6 520,39 on the assumption of a gold price
of US$400/oz. Whilst this is a premium on the ruling exchange rate the price
has to be consistently reviewed to ensure the viability of the industry.

Despite the significant and commendable decline in the rate of inflation in
2004, the coming year may see the RBZ struggling to maintain its momentum.
The budget released by the Minister of Finance late last year offers a
remainder of government's insatiable appetite for spending. In keeping with
the RBZ's inflation forecasts, average inflation is expected to be 100%.
Thus the envisaged 214% increase in budgeted expenditure to $27,5 trillion
is inflationary and a cause for concern, especially as the bulk ($22,5
trillion) has been devoted to recurrent expenditure. Not helping matters was
the recent announcement of a 600% wage increase granted to civil servants.
This will only serve to prompt demand-pull inflation which had been kept in
check in 2004 largely due to a tight monetary policy discouraging spending,
particularly effective in the first quarter of 2004.

The continued indiscriminate hiking of prices by parastatals in the face of
declining inflation poses a significant pressure on costs throughout the
economy. These increases are largely unchecked and appear to bear no
resemblance to any index of prices, international or otherwise.

The auction rate in the last half of 2004 highlighted the dearth of foreign
currency in official channels. A re-emergence of parallel market activities
can only add to cost-push pressures.

At best, we believe that economic growth is set to remain static. There is a
considerable threat to the country's movement towards macro-economic
stability in the form of a renewed inflationary spiral, and scarce foreign
currency inflows are likely to be exacerbated by poor domestic production
inducing a greater demand for imports. It may need a further monetary shock
to stabilise the economy.

However, one has to ask whether an already stressed nation would be capable
of sustaining yet another blow of this nature?
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Zim Independent

Editor's Memo


ELSEWHERE in this paper we carry a little story about a Zimbabwean man based
in Canada who has been arrested in Toronto for allegedly swindling the
public in the name of aiding victims of the tsunami tragedy in south-east

The man, Elmon Muringwa, had devised a scheme to collect funds from the
public as a charity worker for an organisation that does not exist. At the
time of his arrest he was in possession of a bogus Red Cross identification

Needless to say, the money never reached the claimed victims.

The story of Muringwa is one of many throughout the world of people who have
tried to profit out of the disaster by collecting funds in the name of
charity. Others have set up bogus relief institutions to collect money from
the unsuspecting public.

The government in Sri Lanka is probing allegations that there is a syndicate
selling children orphaned by the tragedy. There is no evidence yet but
Interpol has issued a warning that there might be a surge in crime
orchestrated by felons trying to profit from the disaster.

We live in a cruel world where adults are not ashamed of stealing from a
beggar's bowl. But still the international response to the disaster has been
overwhelming. The British public raised a reported £100 million. Zimbabwe
has joined the international community in this noble move to gather
resources for those afflicted by the floods.

The formation of our own Zimbabwe Tsunami Disaster Fund committee - which is
representative of the broad spectrum of Zimbabwean society - is a welcome
development. The chairman of its publicity committee is Information
permanent secretary George Charamba who I believe also has a task on his
hands to publicise the crisis which has been created by the HIV/Aids
pandemic closer to home. Then there are reported food shortages which
government is reluctant to admit, let alone address.

However, much as though I welcome the setting up of the fundraising
committee, it is with some trepidation looking at our record as Zimbabweans
of handling relief funds. Funds collected in the past for various relief
activities, including bus disasters, have failed to reach the intended
targets or have taken too long to do so.

This is dangerous as it undermines public confidence in relief mobilisation.
The government has had its fair share of scandals for anyone to trust it
where money for relief efforts is involved.

In cases where allegations of abuse have been raised, the government has not
called for independent audits or state enquiries. This is a worrying trend
which is not only endemic in government but also in civic society
organisations handling relief funds.

The fiasco in the handling of the Aids levy is instructive in exposing the
aptitude of civic society to misuse public funds.

But central government has been more culpable in abusing relief funds.

Three years ago the Ministry of Local Government deposited $4 million
received for victims of the Masvingo bus disaster in a bank account in
Harare with instructions the disbursement be undertaken after four months.

The money was expected to grow whilst in a high interest account before it
could be disbursed. That was the logic. But it meant the money did not get
to those in need quickly enough.

The Nyanga Bus Disaster Fund of 1991 is another example that immediately
comes to mind. When a B&C bus crashed in Nyanga killing 91 schoolchildren
and teachers from Regina Coeli Mission, there was a huge response from the
public to assist.

Almost every school raised funds to assist the families of the deceased.
There were donations in cash and kind from the corporate sector but parents
and others were never told how much was raised. It is however a fact that
funds disappeared while in the hands of government officials. Many members
of the public or the corporate world have not forgotten.

There were no arrests or censure of those suspected of diverting the funds
from the victims or relatives of the disaster.

Perhaps Didymus Mutasa's Anti-Corruption and Anti-Monopolies ministry can
investigate, even at this distance in time.

It is unfortunate that when the public shows reluctance to respond
positively to relief mobilisation, it is the beneficiaries who are

It would be sad if funds to be collected for victims of the tsunami end up
in the wrong pockets or are subjected to senseless bureaucracy so they only
reach the intended beneficiaries after many months. As it is, Zimbabwe
dilly-dallied in response to the south-east Asian crisis with officials
paralysed until President Mugabe returned from his holiday.

Whatever the case, let's now assist our friends in south-east Asia and East
Africa who bore the brunt of the natural disaster with generosity of spirit
whatever our own needs.
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