G8 pledges stalled as rulers cling to power

The Telegraph

By David Blair, Africa Correspondent
(Filed: 01/07/2006)

      African leaders refused to sign a "democracy charter" yesterday,
objecting to a clause barring them from rewriting their constitutions in
order to stay in power.

      A year after leaders of the rich world gathered at the G8 summit in
Gleneagles and pledged to double aid to Africa in return for "good
governance", the leaders threw out a document that was supposed to enshrine
the new era of democracy.

      The charter, presented to African foreign ministers at a summit in the
Gambian capital, Banjul, outlaws military coups and illegal transfers of
power. But one passage also barred countries from changing their
constitutions to "prolong the tenure of office for the incumbent
government".

      Six leaders, notably President Yoweri Museveni, of Uganda, are in
office because they removed term limits from their constitutions.

      Since rich countries promised to lift Africa out of poverty, much of
the focus from campaigners, including Bob Geldof, has been on whether they
have kept their pledges.

      But development experts say that decisions such as the rejection of
the democracy charter make it impossible to ensure this money is properly
spent.

      The goals set out at Gleneagles were dramatic. The summit members
agreed to cancel the multilateral debts of poor countries, boost aid by £28
billion by 2010 - with half of this new money going to Africa - and open
their markets to African agriculture.

      Geldof said this week that leaders of the rich world had "forgotten"
Africa. The rock musician concluded that the rich countries had kept the
deal on debt but failed to spend enough on aid.

      But benefits have resulted from last year's decisions, exploding the
pessimists' argument that aid is always futile. Millions of Zambians have
had free health care since April 1, when the government abolished fees at
rural clinics thanks to aid and debt relief.

      Yet anyone who lives in Africa knows the hard, inescapable truth:
nothing fundamental will improve unless Africa itself changes.

      Debt relief and extra aid were only part of the deal reached at
Gleneagles. In exchange for new money, African leaders agreed to fight
corruption and ensure that peace, democracy and the rule of law prevail
across their continent.

      Tony Blair, has established an "Africa Progress Panel", including
Geldof among its members and chaired by Kofi Annan, the United Nations
secretary-general. This gathering will monitor the G8 pledges and blow the
whistle if leaders break them.

      Yet, oddly, a panel on "African progress" will only examine rich
countries and studiously avert its gaze from Africa. There is plenty in
Africa for the new panel to sink their teeth into.

      President Omar al-Bashir of Sudan and a grisly assortment of rebel
leaders are waging war in Darfur, where two million people are in refugee
camps.

      Mr Blair's panel will not bring peace to Sudan. But it might ask why
African leaders considered making Mr Bashir chairman of the African Union
and the continent's face to the world at their summit last January.

      President Robert Mugabe, of Zimbabwe, single-handedly impoverished
hundreds of thousands of people last year by sending bulldozers to flatten
their homes. The "African Progress Panel" may ask why no African leader
uttered a word of protest during these grotesque demolitions.is the party
over for goa?

Calls for co-operation between AU, UN

SABC

July 01, 2006, 14:45

Alpha Omar Konare, the African Union (AU) commission chairperson, has called
for co-operation between the AU and the United Nations (UN) to ensure peace
in conflict areas such as Somalia, Chad and Sudan. He was addressing the
opening ceremony of the AU Heads of State Summit under way in the Gambian
capital Banjul.

The summit has brought together the majority of Africa's leaders to debate
pressing issues on the continent's agenda. However, issues expected to
dominate the agenda include the human and people's rights court, fighting
unemployment and eradicating poverty.

In 2003, a decision was taken to establish an African court of justice on
human rights. The following year, the decision was reversed. It was then
agreed to merge a court of justice and a human rights court. This was in the
wake of an increase in human rights violations.

Zimbabwe and Ethiopia are some of the countries listed in the report on
human rights abuses. At previous AU summits, the issue of human rights
abuses was hardly given the attention it deserved.

War torn Sudan expected to dominate AU agenda
The war in Sudan's western region of Darfur is also on the agenda. African
leaders are expected to reiterate calls for Sudan to accept UN peacekeepers
to replace an overtaxed AU force.

Focus will also be on the possible sideline meeting between President Thabo
Mbeki, Robert Mugabe, the Zimbabwean president, and Kofi Annan, the UN
secretary-general.

African summit fosters anti-U.S. sentiment

The State, South Carolina

HEIDI VOGT
Associated Press
BANJUL, Gambia - A summit of African leaders opened Saturday with a special
welcome for the firebrand presidents of Iran and Venezuela, each visiting
the poorest continent to win support for their anti-American agenda.

Gambian President Yahya Jammeh hailed the presence of Venezuela's President
Hugo Chavez and Iran's President Mahmoud Ahmadinejad at the summit of the
53-nation African Union as "a morale booster as well as an assurance that
Africa can make it."

Ahmadinejad's visit was seen as an attempt to bolster Iran in its standoff
with the United States and Europe over its nuclear program. The Iranian
president has made several high-profile trips to Asia, where he drew crowds
of Muslims cheering Tehran for defying the West.

He prayed with African Muslims at Banjul's main mosque Friday, encouraging
Gambian Muslims to "come together on the path of Islam to God."

Ninety percent of Gambia's 1.6 million people are Muslim, and Islam is a
powerful force throughout much of Africa.

Leftist icon Chavez - who was to address the summit later Saturday -
repeatedly attacks the U.S. and President Bush in speeches and has worked to
form Latin American trading blocs to counterbalance U.S. economic power.

Venezuela, the world's ninth-largest oil producer, has talked to African oil
producers about potential collaborations, though no agreements have been
signed, said Richard Mendez, deputy head of mission at the Venezuelan
Embassy in Ethiopia.

Iran is the fourth-largest global oil producer.

Mendez added that Venezuela is hoping for African support in its bid for one
of the rotating seats on the U.N. Security Council, a proposal opposed by
the United States.

But Chavez's appearance was more reflective of a broad desire to show
solidarity with Africa, Mendez said.

The Venezuelan leader also is planning to visit Iran next month to discuss
energy issues.

Leaders at the weekend summit are expected to address issues including the
conflict in Sudan's Darfur region, the rise of a hard-line Islamic regime in
Somalia and often-deadly illegal migration by Africans to Europe.

Even if resolutions are passed, African Union members aren't beholden to
them and the body has little funding to pursue independent action.

Among African leaders confirmed to attend were South Africa's Thabo Mbeki,
Libya's Moammar Gadhafi, Liberia's Ellen Johnson Sirleaf, Nigeria's Olusegun
Obasanjo, Zimbabwe's Robert Mugabe and Kenya's Mwai Kibaki.

On Darfur, the leaders are expected to reiterate calls for Sudan to accept
U.N. peacekeepers to replace an overtaxed African Union force.

At a meeting this week, the group's policy-making peace council made clear
it wanted the handover, refusing to extend the mandate of African Union
forces beyond September. The council also announced targeted sanctions
against anyone who stands in the way of peace in Darfur.

Sudan has resisted U.N. peacekeepers for Darfur.

"We think the African Union could be supported," rather than replaced, said
Taj Elsir Mahjoub, a Sudanese delegate in Banjul.

The Darfur conflict began in early 2003 when members of ethnic African
tribes rose in revolt against the Khartoum government. Sudan's government is
accused of responding by unleashing Arab militias known as the janjaweed who
have been blamed for the worst atrocities.

The conflict has left more than 180,000 people dead, driven 2 million from
their homes, and undermined stability in neighboring Chad and Central
African Republic.

U.N. Secretary-General Kofi Annan was expected to meet with Mugabe, who is
under increasing international pressure to resolve Zimbabwe's political and
economic crisis.

A proposal threatening suspension of African Union membership for nations
that abolish presidential term limits is also under consideration.

---

Associated Press reporters Todd Pitman and Momodou Jaiteh in Banjul
contributed to this report.

Kick start

Dear Family and Friends,
There has been much talk in the state owned media this week about the fact
that
Zimbabwe is a sovereign state and will not be dictated to or colonized by
anyone, from anywhere, ever again. 99% of news readers on ZBC radio and TV
are
unable to pronounce the words sovereign and sovereignty and no one corrects
them
and so now a whole generation of young Zimbabweans are talking about
protecting
our sov-er-wren-ity. Adhering to the meaning of the term, however, seems as
elusive as the pronunciation because every day now we hear about the
involvement of other countries in the basic nitty gritty's of our day to day
affairs. We have a rash of cheap Chinese products ranging from clothes to
luggage and tools all over the country already and have Chinese aeroplanes
and
minibuses moving us around. Last week there was talk of Chinese interest in
our
thermal power stations and this week we hear of pending "joint ventures"
with
the Chinese in regard to Tel One (our telephones) NRZ ( our railways) and
Hwange
(our coal mines). It's not clear yet what benefits the Chinese will gain
from
all these joint ventures but so far we hear of pay back involving cobalt and
other minerals still buried in our sovereign soil.

Trying to come to grips with it all - the podium banging, the selling of our
essence and the mortgaging of our soul -is overwhelming and exhausting - as
is
our daily life. It is a daily life in Zimbabwe that is so ridiculous that a
nervous breakdown seems precariously close almost all the time. It is a
daily
life dominated by rubber bands - to hold stacks of money together in one,
two,
five or ten million dollar bundles. A daily life swamped with electricity
power
cuts - two, four or five hours at a time - sometimes twice a day. A daily
life
suffocated by a rash of new rules and regulations, bills and prices.

This week we  received our second telephone account for this month. The
second
bill arrived just ten days after the first one and printed on the top,
surrounded by a line of stars, was the legend: "Tarrifs have been increased
per
unit to $18 895.50 W.E.F. {with effect from} 14/06/06. You will receive 2
bills
for June 06." There are no apologies offered - this a government owned
company
and there are no other fixed line telephone companies in the country so it
is
simply a case of pay up or get cut off. For the second time in a month the
queue
snaked out of the door as all the receipts were being written out painfully
and
laboriously by hand as there was yet another power cut.

Emerging from the freezing cold queue after paying my second phone bill, the
sight of what should have been a bustling town on a busy Friday morning at
month
end was surreal. Almost the entire town had stopped. Sitting on roadsides
and
pavements, lying on grassy patches, leaning against walls - the whole town
was
just waiting ever so patiently for the power to come back on. The
electricity
had been off since 6.30am  and finally at 11 am it came back on. Everywhere
people started running - to get back into queues for photocopiers, for
passport
processing, for cash machines, for computers. Life had suddenly been kick
started again....and so we stagger on....again. Until next week, thanks for
reading, love cathy.Copyright cathy buckle 1st July 2006.
http://africantears.netfirms.com

Zim pardons three SA spies

Mail and Guardian

      Harare, Zimbabwe

      01 July 2006 01:20

            Zimbabwean prison officials on Saturday released three South
African spies who were jailed for life in 1988 for murder and sabotage, a
state daily reported.

            "Three South African spies, who were jailed for life in 1988 for
murder and sabotage after bombing the African National Congress bases in
Zimbabwe during apartheid era, will be released today [Saturday} from
Chikurubi Maximum Security Prison following a Presidential pardon," the
Herald reported.

            The daily quoted Zimbabwe Prison Service spokesperson Elizabeth
Banda as saying those being released were Kevin Woods, Michael Smith and
Phillip Conjwayo.

            "The president [Robert Mugabe] has approved their release and
they are also being released on medical grounds. They will be released ...
today [Saturday]."

            The trio were sentenced to death by the High Court in 1988 for
the murder of a Zimbabwean driver hired to take a car bomb to a house owned
by the ANC in the second city of Bulawayo.

            The bomb, however, detonated while the driver was still in the
car. Their sentences were commuted to a life in prison after the Supreme
Court had found in another case that a long delay in carrying out death
sentence was, at that time, unconstitutional.

            Over the years, Woods, Conjwayo and Smith had sought amnesty and
deportation to South Africa after they had been granted citizenship by
Pretoria after committing the crime.

            At the time of their arrest the three were Zimbabwean citizens.

            In 2003, Woods applied to seek medical treatment in South Africa
but was turned down.

            Another member of the group, Barry Desmond Bawden, was released
from prison in 1999 after serving his full sentence minus remission for good
behaviour.

            Bawden was in a different group from the other three because he
had not participated in the murder of the Zimbabwean driver but was involved
in other sabotage activities.

            Zimbabwe released South African citizens who breached its laws
whilst in action against the liberation movements at the request of
President Nelson Mandela's government soon after the country's first
democratic elections.

            In December last year, Zimbabwe also released another South
African spy, Aubrey Welken, who had been arrested in 2003 for running an
espionage ring. -- Sapa-AFP

African Union postpones democracy charter

From Reuters, 30 June

By Alistair Thomson

Banjul - Disagreements over preventing African leaders extending their rule
indefinitely have forced the postponement of a democracy charter due to have
been adopted at a summit this weekend, South Africa said on Friday. South
Africa's Foreign Minister Nkosazana Dlamini-Zuma said foreign ministers from
the 53-member African Union meeting in Banjul, Gambia on Thursday discussed
a draft African Charter on Democracy, Elections and Governance. But they
could not agree on a clause to prevent governments altering constitutions to
extend their rule, and decided instead to send the draft document back to a
committee of ministers who drew it up, she said. The charter had been due to
go before a heads of state summit starting on Saturday. "The charter has
been sent back, so that it can't be adopted unless the heads of state
disagree with the ministers, which is unlikely," Dlamini-Zuma told
reporters. "The main contention was around the clause that talks about
people not being allowed to manipulate the constitution to extend their
terms of office," she said.

A draft charter drawn up by the committee of AU ministers in early June
included a clause threatening sanctions against governments who violated the
spirit or letter of their constitutions to extend their rule indefinitely.
The clause was seen as targeting a growing number of African presidents who
have tried to amend their constitutions to remove term limits. Leaders from
Uganda, Guinea, Gabon, Burkina Faso, Congo Republic and Chad have recently
used constitutional change to extend their rule. A bid by supporters of
Nigerian President Olusegun Obasanjo to change the constitution to allow him
a third term was defeated in parliament in May. The far-reaching draft AU
charter also called for elections to be organised by independent
commissions, pledged signatories to eliminate discrimination and human
rights abuses, and reinforced the African Union's condemnation of
governments who seize power by unconstitutional means. Some experts say that
even if adopted at a future African Union summit, the charter would be more
a statement of intent than a binding treaty. "It is not enforceable, it's
more of a guide. It has moral status," said one diplomat following the
Banjul summit.

Zanu PF central committee statement on Makwavarara

New Zimbabwe

--------------------------------------------------------------------------------
THIS is the full text of a statement released by the Zanu PF Harare central
committee members reacting to Makwavarara's re-appointment as chairperson of
the commission running Harare city.

--------------------------------------------------------------------------------
Last updated: 07/01/2006 11:07:37
CENTRAL committee members of the Zanu PF Harare province met in Harare in
the evening of 29th June 2006.
Top of its agenda was the consideration of the continued deterioration of
the situation at the Harare Town House and the negative impact it was having
in the service delivery to the residents of the city. The meeting had
expected the Minister of Local Government, Public Works and National Housing
Dr I Chombo to brief the meeting on the developments in Harare, but the
minister had not turned up. In the absence of such a briefing the central
committee members of the Harare province have inter alia:

1) Mantained its earlier position that the incumbent chairperson of the
commission Ms Sekesayi Makwavarara is unsuitable to continue to lead the
city. It has been observed that she lacks professional and leadership
qualities to deliver as per the ratepayers' expectations and has a tendency
of making unilateral decisions without consulting other members of the
commission.

2) She has undermined and demeaned the position of the party in Harare and
not being a member of the party herself, she cannot expect any further
co-operation from the residents and Zanu PF in Harare.

3) While not defending the interests of any person in the council, the
meeting is worried by the fallout and irreparable damage being wrought to
Harare by Sekesayi Makwavarara.

4) The meeting has been saddened and shocked by the continued circumvession
of council tender procedures and misuse of council funds.

5) Central Committee members of the Harare province believe the issues of
suspending the Town Clerk will not solve the problems of Harare as Sekesayi
Makwavarara is not qualified in all aspects to lead such a city as Harare.
She should have provided leadership to the city but has dismally failed.

6) Central Committee members of the Zanu PF Harare province's position is
driven by the residents of Harare and Sekesayi Makwavarara should take
heed - ZANU PF YARAMBA.

7) That anyone so interested in protecting Sekesayi Makwavarara can transfer
her to another willing city as Harare will hence forth not co-operate with
her in any undertaking.

8) All these developments are unfolding at a time when Harare
ratepayers are bearing the burden of the current economic hardships.

9) Central Committee members of the Zanu PF Harare Province feel that
Sekesayi Makwavarara is not an executive mayor but only chairperson and any
assumption is ultra vires the law.

10) Central Committee members of the Harare province remain dismayed at the
consequences and the "I don't care attitude" adopted by certain individuals
who should be standing by the party.

African leaders urged to defend press freedom

Thirst for oil fuels China's grand safari in Africa

The Times, UK July 01, 2006

            By Gabriel Rozenberg, Jonathan Clayton and Gary Duncan

            Our correspondents report on the trade flowing into the world's
poorest continent

            THE battered signs in the lobby of the main international hotel
in Lubumbashi, capital of Congo's mineral-rich Katanga province, had barely
changed in years. Next to the faded, out-of-date insignia of the traditional
European airlines, they give details of all direct and non- direct flights
to Paris, Brussels, Zurich, and London - the favoured destinations of the
frequent visitors from Europe's mining houses.
            A few months ago, however, Kenya Airways - Africa's fastest
growing airline - proudly declared in bold new colours the latest additions
to its network - direct flights to Guangzhou and Hong Kong.

            To many, the difference in signs symbolised Africa's changing
relationships with the world - one with Europe, old and out-of-date, the
other with China, brash and growing.

            Few people in the former Belgian Congo were surprised at the
development. They have watched over the past two years as the number of
Chinese businessmen on flights in and out of the country has grown from a
trickle to a torrent, matched by similar incursions into neighbouring Zambia
and Angola.

            "They started coming in about two years ago, but they were
small-time merchants and set up as middlemen buying from local outfits,"
said Jean-Pierre Kabongo, who runs a miners' association in Katanga. "Now
they are buying the companies themselves."

            China is moving into Africa on a grand scale. Still a developing
nation itself, it has nonetheless now overtaken Britain to be the continent's
third-biggest trading partner after the United States and France. Its
inroads into the world's poorest continent are the the most striking sign of
the biggest shake-up in patterns of world trade in a generation.

            The pace of change is startling: in the first four months of
this year, Chinese imports from African countries totalled nearly $9 billion
(£4.9 billion) - a small figure by world standards, but up by more than 50
per cent from the same period a year ago. In 2005 total trade flows reached
$39.8 billion, a doubling in volumes in just two years, and nearly four
times the level of trade in 2001.

            For the world's fastest growing economy, Africa is first and
foremost a supplier of oil. In Sudan, state-owned oil companies have been
investing since Western companies left in the mid-1990s. In 1996 China
bought a 40 per cent stake in two oilfields and since 1998 it has helped to
build a 930-mile pipeline from the fields to the Red Sea. Last year it
bought 50 per cent of Sudan's oil exports, accounting for 5 per cent of its
needs.

            China has stakes in extraction in Nigeria, Angola and Algeria,
among others. Its biggest deal so far came in January when CNOOC, the
state-owned energy company, announced it would buy a 45 per cent stake in an
offshore oilfield in Nigeria for $2.3 billion.

            Other countries benefit from China's position as the world's
leading importer of base metals. Africa now supplies one third of China's
manganese; South Africa is the fourth- largest supplier of iron ore to
China; and 85 per cent of Chinese imports of cobalt come from the Republic
of Congo, the Democratic Republic of Congo and South Africa.

            Projects range from diamond mining and timber logging to cotton
and telecoms. About 800 Chinese companies are now working in Africa, and one
estimate puts the number of expatriate Chinese workers in Africa at 78,000.
A key to their success is the willingness of Chinese state-run companies to
undercut their Western rivals and take on the projects they dismiss as too
risky. Zambia's neglected Chambishi copper mines are being overhauled by
China, and around them has sprung up what visitors describe as the
fastest-growing Chinatown in the world.

            CNOOC recently agreed to pay $2.3 billion to rehabilitate the
Kaduna oil refinery in Nigeria, a loss-making project which no privately
owned Western company would touch.

            And China is building not just mines and refineries in Africa
but the very infrastructure itself: roads, bridges and power grids across
the continent are being thrown up by Chinese firms. Flows of foreign direct
investment from China into Africa have risen from $1.5 million in 1991 to
$107.4 million in 2003, according to the Ministry of Commerce. China has
sent 1,100 doctors to Africa, taken African students to China on educational
exchanges, and designated 16 African countries as official tourism venues.

            If Western nations were to intervene so widely it would be
decried as colonialism. But China's success is partly because of its
willingness to ignore politics and focus on what makes business sense. Its
firm policy of non-interference in the domestic affairs of other countries,
born out of its dislike of foreign interference in its own affairs, makes it
a popular player in the eyes of many African governments, particularly
those, such as Robert Mugabe's Zimbabwe, that can find few other
international supporters. The scrapping of hundreds of tariffs on African
imports and a $1.3 billion debt write-off in 2003 have also strengthened
relations.

            Chinese leaders have dubbed 2006 the "Year of Africa" and are
aggressively courting the continent. Li Zhaoxing, the Foreign Minister,
visited in January and President Hu Jintao followed in April. On a
seven-country tour last week, Wen Jiabao, the Prime Minister, agreed to
restrict textile and clothing exports to South Africa to dampen opposition
from local garment producers.

            The International Monetary Fund now estimates that Africa's
growth is edging towards 6per cent, its highest in 30 years, partly because
of Chinese investment and its soaring demand for raw materials.

            Gerard Lyons, chief economist at Standard Chartered Bank, said
that Africa was only part of the picture. "Globally, we're seeing new
corridors of trade opening out between regions in terms of flows of
commodities, goods, people and investment. This is just one aspect of it."

            In oil-rich, war-torn Angola, Chinese companies will build
railway lines, schools, roads, hospitals, bridges, offices and a fibre-optic
network, thanks to a $2 billion loan deal in which Beijing can secure a
stake in the country's offshore oilfields. Last week it pledged a further $2
billion loan to the country.

            But that approach has caused concern in Western countries, who
mutter that China's loans are undermining attempts to link aid to reform and
break the cycle of African countries' indebtedness. Equally critics add that
although the West is moving away from "tied aid", Chinese generosity often
comes with requirements to employ Chinese citizens or to buy in Chinese
resources.

            Another worry is weapons sales: according to the US
Congressional Research Service, Chinese arms sales made up 10 per cent of
all conventional arms transfers to Africa from 1996 to 2003. China has faced
allegations of providing weapons used by the Islamic government in Khartoum
to terrorise civilians in Darfur, and of selling fighter jets and
radio-jamming devices to Zimbabwe.

            Alarm is greatest in the US, where a recent Energy Department
report argued that China's tolerance of despotic regimes could undermine
Washington's strategic goal to spread democracy and free trade.

            There are several motives behind China's African safari. First,
it makes economic sense: China requires access to oil and natural resources
on a vast scale and wants them delivered securely. But there are also
political drivers. China can use its financial muscle to drive forward its
acceptance as a market economy and to exert pressure on the two dozen or so
countries that still recognise Taiwan.

            Its ultimate strategic goal, however, is unclear, perhaps
because it has only just begun to consider it. "Involvement in Africa
crystallises China's dual identity between being a developing country and a
major power," Andrew Small, China programme manager at the Foreign Policy
Centre, a UK think-tank, said. "They have achieved a position of far greater
importance in Africa than they probably planned to."

            However, Ann Grant, of Standard Chartered Capital Markets, said:
"China has a strategic approach to Africa, in which the markets, the energy
security and the political relationships are all very much of a piece. They
are looking not at the next two to three years but at the next 15 to 20
years."

            Deutche Bank Research estimates that China will remain "hungry
for commodities" for at least the next 15 years. In particular, it forecasts
China's annual demand for oil to rise by 20 per cent a year, from 91 million
tons in 2005 to a staggering 1.9 billion tons in 2020. By 2045 China is
projected to rely on imported oil for 45 per cent of its energy needs.

            In the old Belgian mining town of Likasi, a 75-mile drive from
Lubumbashi, China has opened a new cobalt plant, the Feza Mining Company.
Rundown suburban houses, once the homes of expatriate managers, are being
repaired and taken over by the new arrivals.

            "Production is still small but we should be able to expand it
very quickly; the ground here is so rich," one of its managers, Willy Zhang,
told The Times on a recent visit.

            Nearby, Chinese labourers were working alongside Congolese,
paving a new road to two mines bought from the bankrupt state giant
Gecamines by a Chinese consortium.

            Mr Kabongo sums up the situation laconically. "No one knows who
they are, but they are Chinese," he says.

Beijing urged to improve policy on continent

The Times, UK July 01, 2006

            By Richard Beeston, Diplomatic Editor

            BRITAIN has called on China to match the huge expansion of its
economic ties in Africa with a more responsible foreign policy towards some
of the continent's most notorious regimes.
            In a subtle dig at China's relations with countries such as
Sudan, Zimbabwe and Angola, Lord Triesman, the Foreign Office minister
responsible for Africa, said that Beijing had to "go beyond words" in
promoting democracy, the rule of law and social justice.

            The West has grown increasingly concerned that China's $40
billion (£22 billion) trade with African countries will undermine efforts by
the international community to promote good government, uphold human rights
and resolve conflicts.

            Wen Jiabao, China's Prime Minister, sought to allay those fears
this month. During a seven-nation tour of the continent he called on
"African countries to improve democracy and the rule of law".

            But the guiding principle of Beijing's policy - to export raw
materials from Africa to feed its economic expansion - was probably better
explained by President Hu Jintao. During a visit to Kenya in April he
reiterated that China follows "a policy of non-interference in other
countries' internal affairs".

            Certainly Lord Triesman told the Institute for Public Policy
Research this week, in the first speech by a British minister on the
subject, that the Chinese needed to do much more. In particular, there is
concern over China's support for the regime in Sudan, which has been accused
of orchestrating a "genocide" against African tribes in the eastern Darfur
region.

            Sudan is a big supplier of oil to China. In return, the Chinese
supply arms to Khartoum which have been used against rebels and civilians in
Darfur.

            The Chinese have also slowed efforts at the United Nations
Security Council to use sanctions against Khartoum and deploy a UN
peacekeeping force in the area.

            "It is important for all the members of the Security Council . .
. to take tough measures as necessary to ensure the Government of Sudan
meets its international commitments," Lord Triesman said.

            Zimbabwe is another point of contention. President Mugabe may be
banned from visiting America and the European Union for the abuses of his
regime, but last year he was invited to Beijing. In return for mineral
rights, the Chinese have extended loans to Harare as well as arms.

Zimbabwe eyes stake in Mozambique power firm

From Angola Press, 29 June

Harare, Zimbabwe, 06/29 - A top Zimbabwean energy official said Wednesday
the government had put in a bid for a 25 percent stake in Mozambique`s
electricity generator, Hydro Cahora Bassa (HCB). Obert Nyatanga, director of
the state-owned Zimbabwe Electricity Supply Authority (ZESA), said about
US$500 million was being mobilised to buy the stake, crucial to securing
badly needed long-term power supplies. The country is currently facing a
power crisis, partly made worse by its inability to import sufficient
quantities due to foreign currency shortages. Zimbabwe generates 65 percent
of its national requirements, and relies on neighbours for the balance. But
apart from inability to finance electricity imports, a general power
shortage in the region has also forced Zimbabwe`s neighbours to scale down
exports to the country. Nyatanga said Zimbabwe might bid for the stake with
other investors from Asia, who have also expressed interest in the deal.
"The deal is being looked into. Funds to get equity in HCB are being
mobilised by the government through its partnerships with strategic
investors in Asia," he said. "It is a strategic transaction that can also
boast ZESA operations so we just hope that the Mozambican authorities will
come out with something positive," he added.

Zimbabwean company wants shares in Cahora Bassa

Comment from AIM (Mocambique), 30 June

Paul Fauvet

Maputo - Zimbabwe's near-bankrupt electricity company, ZESA Holdings, wants
to buy 25 per cent of the shares in HCB, the company that operates the
Cahora Bassa dam on the Zambezi river in Mozambique's western province of
Tete. This news was reported, without a hint of irony, by the government run
Zimbabwe daily "The Herald", on Wednesday. "The Herald" reporter did not
seem to think it appropriate to ask how a company such as ZESA, which
already has enormous difficulties paying its creditors, can possibly
purchase a quarter of the largest dam in southern Africa. Perhaps that was
because the managing director of ZESA, Obert Nyatunga, declined to give any
details, and said the matter had been remitted to the Zimbabwean Ministry of
Energy. He said everything was being negotiated by the government through
the Ministry of Energy.

Supposedly the proposal was sent months ago to the Mozambican government. In
which case, the Zimbabweans are knocking on the wrong door: for the majority
shareholder in HCB is the Portuguese state, not the Mozambican one.
Mozambique could not sell 25 per cent of HCB to ZESA because Mozambique does
not own 25 per cent of the company. The Mozambican state's current holding
is just 18 per cent. The shareholding structure of HCB is not a secret, and
it is a sorry reflection on the state of journalism at "The Herald" that the
paper's staff cannot be bothered to find out and inform their readers. Ever
since HCB was set up, in 1975, Portugal has owned 82 per cent of the shares
and Mozambique 18 per cent. In November last year, when Mozambican President
Armando Guebuza visited Portugal, a memorandum of understanding was signed
under which Portugal will cede majority control over Cahora Bassa to
Mozambique.

In principle, the Mozambican state will hold 85 per cent of the shares, and
Portugal 15 per cent. But over seven months have passed and the final
agreement has yet to be signed (apparently because Portugal's partners in
the European Union have raised objections to the financial arrangements). So
currently the situation is exactly the same as it has always been: the
Mozambican government cannot sell the dam, because the Mozambican government
does not own the dam. Furthermore, once the November memorandum takes
effect, Mozambique will have to pay 950 million US dollars for its extra 67
per cent of HCB. This is to be paid within 12 months of the Portuguese and
Mozambican governments signing the final agreement on the transfer of
ownership. So in all probability, Mozambique will not be in full control of
the dam until mid-2007. Could it then sell shares to ZESA ? Possibly: what
the memorandum states is that Mozambique may request that a third of the
Portuguese shares (i.e. five per cent of the HCB capital) be sold at their
market value. But this can only be done if the Mozambican state also agrees
to sell part of its holding to third parties.

How much would ZESA have to pay for 25 per cent of HCB ? If 67 per cent of
the dam costs 950 million dollars, then 25 per cent will cost at least 354
million dollars. But the price for Mozambique's shares, fixed after many
years of negotiation between Maputo and Lisbon, is not a market price at
all. So ZESA would doubtless have to pay much more. "The Herald" appears to
agree, since its report claims that the Zimbabwean government is mobilising
500 million dollars from unnamed sources for the purchase. But what
creditors in their right mind would lend even 354 million dollars, let alone
500 million, to a public utility in a country such as Zimbabwe, with an
economy in ruins and four figure inflation ? ZESA's recent performance
hardly inspires confidence. Earlier this month it had to shut down three of
its thermal power stations, because it had not paid its bills to the coal
supplier, the Hwange colliery. The Reserve Bank of Zimbabwe (RBZ) came to
ZESA's rescue and stumped up an unspecified sum to pay off the debt to the
colliery.