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
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
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
However, sources yesterday said lawyers who have been hired
to collect debts were hitting a brick wall due to lack of
"These cases are generally proving difficult due to
the prevalence of insider loans and scant documentation," a source
The source said senior employees privy to the disbursement of
insider loans have since left the banks, making it difficult to gather
"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
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
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 year.
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
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
CFX was the last bank to be put under curatorship on December
16 last year. Fungai Kuipa of Ernst & Young was appointed
It is not clear at the moment how much the curators have
collected as the process is still continuing.
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
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
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
"He has a few options such as resigning and contesting
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
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
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.
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.
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.
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
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
Moyo was also left out of the central committee and the
party's powerful decision-making organ, the politburo.
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
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.
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
Efforts to contact Nkomo on the latest developments
proved fruitless as his mobile phone went unanswered.
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 said Nkomo made it clear that disciplinary
action would be taken against all members of the Tsholotsho DCC for their
role in the Tsholotsho indaba.
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
"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
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
Sources said the UNDP had also received proposals from the
Agriculture ministry to assist newly-resettled farmers.
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.
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 project.
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
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
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
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
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
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,
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
"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
"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
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
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.
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.
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
Economists say they were pessimistic 2005 would be any
better for the economy, unless the government restored links to
"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
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.
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.
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
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.
have vanished, replaced by patches of cleared land and pole-and-mud huts
dotted haphazardly on the landscape creating fears of land degradation and
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
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
"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
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
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 agriculture.
"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 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
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.
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.
much-vaunted Environmental Management Act promulgated two years ago has done
little to discourage rampant deforestation in newly settled lands.
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.
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
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
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.
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.
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
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
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.
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.
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 million.
"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.
year more than a dozen schools were closed and headmasters arrested for
charging "exorbitant fees".
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.
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 President.
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.
for Change secretary-general Welshman Ncube said the party had not
contributed in any way whatsoever to the delay in electoral petitions being
"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 office."
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 provinces.
"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 insecurity.
"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
The WFP was ordered by the Zimbabwean government to cease all
food handouts amidst claims that the country had a bumper harvest last
Press reports last week indicated that maize meal, the country's
staple food, was in short supply throughout the
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
However, the WFP has announced that it will continue
with targeted feeding of vulnerable groups such as the elderly and HIV/Aids
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"
Zimbabwe is not included in a list of countries named
in the report to benefit from the its feeding
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
"High inflation and the Grain Marketing Board monopoly
over marketing maize are exacerbating the situation," said
Fewsnet said the cost of food and other non-food items
increased by over 92% last year while wages have failed to keep up.
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
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
"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 said.
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
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." -
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
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".
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 performance.
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
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.
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
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.
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 thinking.
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 Har- mony investment and Ramaphosa's buy into former Anglo
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.
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
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
"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
New hit Uchaenda Wega is likely to make waves as much as
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.
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.
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.
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.
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.
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.
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
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
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,
As guardians of all our civil liberties and liberty itself, they
will be watched - and judged.
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 recovery.
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
industry. It is undeniable that Zimbabwe could have a thriving tourism
sector, for it is richly endowed with much that is sought by the
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
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.
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
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 agreements.
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
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
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.
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 others." 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 self-criticism!
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
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.
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
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
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.
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
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
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 institutions."
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
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 patronage?
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
"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
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
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
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.
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
The move has stalled the downgrading of
some hotels as mooted by the Zimbabwe Tourism Authority in a document leaked
to businessdigest last month.
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).
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
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.
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
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
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
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 month.
"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
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
Experts say that the legal battle between bank owners and
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
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.
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.
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
Mahachi this week confirmed that he was finalising his plan,
which he expects to change the flagging fortunes of the
"I am still trying to put my bags down and meeting some
people. I am familiarising myself with the operations," he
"I will be submitting the turnaround plan to the board and
other stake holders next week, after which the plan will be made
The Air Zimbabwe board is chaired by Livingstone
Mahachi refused to comment on how he intends to revive the
national airline's fortunes saying he needed a mandate from the
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 directors.
"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
Currently, Air Zimbabwe is charging US$1 000 for a return
ticket to China. The payments can also be made using local currency.
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
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
"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
"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
The pension contributory scheme currently has 9 500
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.
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 said.
"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 Company."
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
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.
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
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
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
Also implicated in the scandal is assistant accountant Calvin
"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.
human resources director, Abel Mubango reportedly bought his Pajero from the
bank for an unbelievably paltry $1 million in early 2004."
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
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
CFX management misrepresented the true condition of the bank
by manipulating the system-generated income to conceal accumulated losses of
The manipulated management accounts reflected an
accumulated profit of $9 billion.
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
Investigations into former Century Bank have so far
revealed that some of the employees were put under pressure to produce
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
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
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
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 system.
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 discovered.
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 organisation.
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
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.
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
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
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
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.
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
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
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
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.
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 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 Asia.
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
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
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
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.
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
The fiasco in the handling of the Aids levy is instructive in
exposing the aptitude of civic society to misuse public
But central government has been more culpable in abusing
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.
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
There were no arrests or censure of those suspected of
diverting the funds from the victims or relatives of the
Perhaps Didymus Mutasa's Anti-Corruption and
Anti-Monopolies ministry can investigate, even at this distance in
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
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.