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Ministers lead Zisco looters

Zim Independent

Dumisani Muleya

THE Ziscosteel scandal, which involves looting of public
resources by politicians and top management of the company, deepened this
week as it became evident that a number of ministers were involved.

Information gleaned from various sources shows that
Indigenisation and Empowerment minister Samuel Mumbengegwi, Science and
Technology minister Olivia Muchena and Small-to-Medium Enterprises
Development minister Sithembiso Nyoni, among others, had allowances and air
tickets paid for them by Zisco while on missions that had nothing to do with
the parastatal.

Sources said Higher Education minister Stan Mudenge and the late
Zanu PF MP Gibson Munyoro were hosted by Zisco subsidiaries in Botswana
under unclear circumstances. Former Zanu PF MP Tirivanhu Mudariki is said to
have also benefited through hotel bookings done for him using public
resources. No comment could be obtained from the ministers.

However, a letter obtained from Zisco shows Mumbengegwi - who
was at the time Industry and International Trade minister in charge of
Zisco - was paid by the state-owned steel giant's Botswana subsidiary a US$3
000 "allowance" while he was attending a Sadc meeting in Gaborone on July 17

The letter, dated July 17 2002 and written by Zisco finance
executive Ben Manyunyire to Tswana Iron & Steel MD James Chininga, says:
"Please kindly make available to them (Mumbengegwi and his team) US$3 000 or
equivalent in Botswana Pula and invoice Zisco through the inter-company

Mumbengegwi was travelling with a Ms FA Makombe and a Mrs
Nyagweta for a Sadc meeting from July 22-28. Prior to that, two other
officials from Mumbengegwi's ministry, a Mr V Vengesa and a J Chigwedere,
had on August 15 2002 been paid US$932 as "subsistence allowances" while
visiting Ramotswa/Tswana. Ex-Zisco MD Gabriel Masanga authorised the

Sources said that Zisco subsidiaries also paid Botswana Pula 3
152, 80 for Mumbengegwi's hotel bookings at Cresta Lodge on May 8 2004 on an
unexplained visit to that country. He stayed in room number 9007 and his
invoice number was 76176.

More than P150 000 was spent on hotel bookings for top
government officials and Zisco managers, especially at the five-star Grand
Palm Hotel Casino & Convention Resort in Gaborone where they spent public
funds on food and drink at the Kalahari Bar, often over weekends.

Muchena, Nyoni and Mudariki had air tickets bought for them by
Zisco's sister companies via Koy Tours and Travel on June 17 2004 for
dubious trips between Harare, Johannesburg and Gaborone. P16 625 was paid
for their tickets. Muchena's ticket was for the
Harare-Johannesburg-Gaborone-Johannesburg-Harare trip and its invoice number
was 764.

Nyoni and Mudariki's tickets had the same details. Another
ticket was bought for Mudariki on May 24 2003. Altogether P92 924,40 was
paid for the air tickets, including those of Zisco directors who would
choose to meet in Gaborone even if they were all from Zimbabwe.

Zisco directors were being paid up to P90 000 per head annually
as sitting fees.

Sources said the three-member NECI team which went to Botswana
was told that Mudenge and Munyoro were also hosted there. The team got its
information from Chininga, business manager Shelton Chivhere and accountants
William Oddoye and Benson Mburu. Details on payments were not obtained.

Sources say NECI was told there were several other ministers and
MPs involved in the Zisco scandal, which government is trying to suppress
despite its anti-corruption posture.

Zisco was heavily prejudiced through the sale of steel billets
as scrap metal and manipulation of supply contracts. The plunder was said to
have been rampant in all Zisco entities in Redcliff, South Africa, Botswana,
Namibia and Zambia.

NECI has since recommended the prosecution of senior Zisco
managers, including Masanga and marketing executive Rodwell Makuni, who were
central to the issues. Government is said to be in possession of a lengthy
Zisco document reacting to the scandal which authorities want to give
prominence to.

Sources said there were many questionable payments that Zisco
made to South African companies, including Ramotswa's controversial R1,6
million payment to Macsteel in 2004 for "technical services". Zisco also
paid Chartwell Capital Group more than R470 000 to restructure its balance
sheet and debt profile.

Exchange control regulations were said to have been breached on

Between September 2001 and June last year Ramotswa paid the
Minerals Marketing Corporation of Zimbabwe (MMCZ) US$5 million. It also paid
R6,4 million. Its total purchases from MMCZ between January 10 2003 and
September 30 2005 were US$7,3 million, as well as R45,6 million.

"The problem with these payments is that necessary
reconciliations of Zisco/MMCZ accounts were not being done for the company
to tie specific invoices to the payments done for exports from Zimbabwe," a
source said.

"As a result as at June 31 2005 R39 218 444,43 and US$2 269
483,71 were still outstanding in terms of un-acquitted DC1 forms. Chivhere
told NECI that efforts were being made to pay but Zisco owed a lot of money
to its subsidiaries who want a debt offset arrangement."

There were a lot of other questionable payments made covering
airfares, hotel bookings, purchases of goods, forex, PR and donations,
allowances, fees for directors, management expenses and entertainment.

Ramotswa bought forex from company officials despite having US
dollars and South African rand foreign bank accounts. In 2003, for example,
it bought R43 992, US$10 548 and P87 575,13 from Chininga, business manager
Shelton Chivhere, Zisco company secretary Teddy Mapenzauswa and board member
George Chikumbirike. Chininga and Chivhere were singled out by NECI as
having been involved in a "lot of financial abuse".

Last year Ramotswa again bought R24 866, US$3 595, P43 274,45
from company officials in violation of exchange control regulations.
Suspicious donations gobbled P60 000, while P20 000 was spent on goods for
Chivhere and others.

Entertainment allowances took about P50 000 but NECI established
some were fake. For instance, it found out that on May 8 2003 P300 was paid
to "NECI officials" when in fact no one from the team was in Botswana at the

"The question that quickly comes to mind is how many such
payments were made to faceless people in the name of entertainment," a
source said. "The evidence of massive corruption at Zisco is overwhelming
and senior government officials were involved. Trying to cover this up won't

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Evidence mounts against Matonga

Zim Independent

Shakeman Mugari

THE corruption trial in which deputy Information minister Bright
Matonga is being jointly charged with jailed former Zupco chairman Charles
Nherera opens on Monday amid revelations that the state has accumulated
substantial evidence including a taped conversation in which Matonga, who
was then Zupco CEO, allegedly asked for a bribe.

Sources said the state intends to produce three separate
transcripts of telephone conversations in which Matonga is said to have
asked for a kickback from Jayesh Shah, whose company, Gift Investments,
wanted to supply buses to Zupco without going through tender procedures.

This comes amid information that police have also launched a
probe into the alleged unprocedural conduct of Shah in the importation of
buses four years ago.

Police sources this week said senior officers in the Fraud Squad
who were handling the investigations had been curiously transferred from
Harare and taken off the case. One of the officers has been transferred to
Mutare. The police investigating Shah were focusing on possible flouting of
customs procedures in the importation of the buses.

The sources however said the investigations were "not
progressing well" because of the immunity from prosecution granted to Shah
by the Attorney-General's office. Shah was the star state witness in Nherera's
first corruption case and is also key in the prosecution of the second case
in which Matonga is the co-accused. Nherera was three months ago jailed for
two years after being convicted of soliciting US$85 000 from Shah.

The transcript to hand should be used by the state as part of
its evidence in chief against Matonga, who stands accused of corruption in
the purchase of buses from Shah. The state will contend that Nherara and
Matonga asked Shah to pay them kickbacks amounting to US$20 000 from Shah
before they agreed to buy his buses.

The transcripts show that Matonga and Nherera wanted Shah to pay
them so that they would not terminate his lease to a property he was renting
from Zupco. The two also allegedly wanted bribes to extend Shah's lease to
five years. In one of the three transcripts that are in the possession of
this paper, Matonga tells Shah he wanted "20" but it is not clear whether he
meant millions in the local currency or thousands in United states dollars.

"I will have 20 and the other," said Matonga to Shah. Shah
replied that saying $20 million was too much for him.

"No, it is not. How much can you spare then?" asked Matonga.
Matonga also promised to "arrange" that Shah be the main supplier of spares
of Zupco if he gives him the money. Later Matonga then demands to know when
he was going to get his money saying: "When am I going to get my 20M?"

In the second recording Matonga is heard negotiating with Shah
for the payment terms to be been
made by putting a mark up on the buses.

"At quarter past 8, quarter past.the thing ready. 3500 (US) or
something, 20 million, 5,5,5.5," said Shah.

Matonga replied saying, ".make 5.Yes, 5000." Then Shah said:
"Let us just.yours is 20 million.20 million. .I think I will (sic) the full
guarantee.push," said Shah.

Shah then said Matonga should come to collect the money the next

In the third transcript that the state will produce Matonga
allegedly tells Nherera what they would get from Shah if they give him the
lease for the property he was renting from Zupco.

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Politicians angle for Zisco subsidiaries in Botswana

Zim Independent

Dumisani Muleya

SENIOR politicians are making clandestine efforts to buy
publicly-owned Zisco's Botswana subsidiaries, Ramotswa/Tswana Steel & Iron
Co (Pvt) Ltd in a shady US$3 million deal.

The move comes at a time when Zisco is embroiled in a major
corruption scandal that has drawn in ministers and top managers of the
company. Government is trying to keep a lid on the boiling pot.

Sources said top politicians working with Ramotswa/Tswana MD
James Chininga and his business manager Shelton Chivhere were trying to
acquire the companies that have proved to be critical to Zisco' operations.
The two subsidiaries are owed money by Zisco and have made a lot of payments
on behalf of their parent company.

It is said National Economic Conduct Inspectorate (NECI)
investigators who went to Botswana to investigate the Zisco corruption
discovered plans were already underway to sell the two subsidiaries for US$3
million by repaying their parent firm funds that were used to purchase them
in 2001.

Zisco was said to have overpaid by more than US$500 000 to
purchase Ramotswa. It was suspected to have been a way of transferring money
to Botswana on the pretext of acquiring the company by Zisco officials.

Chininga and Chivhere told NECI that it was their initiative but
did not say why they thought it was necessary to take it. Sources said
politicians were behind the move.

A letter written by Chininga to former Zisco MD Gabriel Masanga
on June 13 last year confirms plans to prise the Botswana subsidiaries from
their parent company.

"We hereby confirm that we have paid Ziscosteel US$62 500 being
loan repayment towards the US$3 million used on the acquisition of
Tswana/Ramotswa Steel & Iron companies," Chininga said.

"We envisage that, depending on raw material availability, these
payments will continue on a monthly basis until the loan is retired."

Sources said government would lose the two steel-making
companies, located 30km outside Gaborone, which are actually viable.
Ramotswa was involved in the payment of R1,7 million to South Africa's
Macsteel in 2004.

"Chininga and Chivhere claim it's their own initiative but one
wonders what is the ulterior motive for this kind of decision," the sources
said. "Who is behind this? We hear there are senior politicians

Zisco, the largest public enterprise and only integrated
steelworks north of the Limpopo, is registered as a private company which is
owned 91% by the government. The other 9% is owned by six different

Its group of companies include Zisco Distribution Centre which
sells its products, Lancashire Steel, that produces items like brick force,
gates and galvanised wire, Zisco Mines dealing in iron ore, Ramotswa/Tswana
Steel which manufactures steel products and the Ziscosteel Agricultural
Manufacturing company that makes ox-drawn ploughs, scotchcarts and hoes.

The steel giant also has subsidiaries in South Africa, Namibia
and Zambia. Zisco owns these entities 100%.

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 . . As firm gives up mining claims to pay debt

Zim Independent

Augustine Mukaro

ZISCOSTEEL has surrendered its mining concessions to KFW of
Germany after failing to repay a US$17,6 million loan advanced for the
construction of its steel plant.

This follows KFW's successful claim against Zisco at the
International Court of Justice. Zisco finance executive Ben Manyunyire told
the Foreign Affairs, Industry and International Trade Parliamentary
Portfolio Committee in August that the company was planning to give the
Germans mining concessions around Kwekwe after it lost the case.

"On the externals (external debt), the major creditors are KFW
of Germany which is almost their central bank which financed the
construction of the steel plant. We owe them $17,6 million through
Forestal," Manyunyire said.

"They have since taken us to the International Court of Justice.
Discussions have been going on with the Attorney-General's office and the
Ministry of Finance and Ministry of Industry but they went ahead and as of
last week a default judgement had been issued in their favour with which
they can proceed to attach property."

Manyunyire said Zisco had to look for alternative ways to ensure
that the Germans recovered their money.

"We tried to give them some mining concessions so that they can
recover (their loan)," he said. "Whether that option is open, we are not
aware but that includes gold mines around Kwekwe."

Other than the Germans, Manyunyire said Zisco also owed the
Chinese for the construction of blast furnace number four.

"In terms of China, there is the China Exim Bank which is being
guaranteed by Sinosure Insurance Company," he said.

"We owe US$4,71 million for the number four blast furnace but
these ones we have been carrying on. By early this year, they had come out
with a turnaround programme which was a short-term one to do our mills
section for value addition so that we could quickly recover and try to pay
them back. It is an amount of US$5,5 million. It was very modest. We had
actually said US$300 000. We had paid them US$953 000 so that they could do
number three furnace."

Manyunyire said locally Zisco owed the National Railways of
Zimbabwe, Hwange and Zesa money on an inter-parastatal arrangement.

"We owe NRZ $88 million and $10 million for Zesa but we can
supply these figures," he said.

During the same tour Ziscosteel workers told the portfolio
committee that they were exposed to poor working conditions without basic
protective clothing.

"Management will tell you to prioritise and they say we cannot
give you all safety clothing," one worker identified as Mumbi said. "When
they say prioritise, they will be saying clothe others and leave others. It
is now about five years. People should be given respirators. If you look at
our shoes, they are torn and we are told that there is no money."

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Land reform eats into forex coffers

Zim Independent

Augustine Mukaro

PRESIDENT Robert Mugabe's delinquent land reform programme has
started to eat into government's thin foreign currency reserves as the
International Centre for the Settlement of Investment Disputes (ICSID) is
demanding US$150 000 advance payment for costs anticipated in a case
involving evicted Dutch farmers.

In a letter to government, the ICSID said the tribunal estimated
costs to be incurred during the arbitration due in the next three months at
US$150 000.

"We have estimated, after consultations with the president of
the tribunal, that an amount of US$150 000 will be required to meet costs to
be incurred in the proceedings during the next three to six months,
including costs related to the first session of the tribunal," reads the
ICSID letter dated November 2, addressed to the Ministry of Finance and
Virginia Mabiza, the acting director of the Civil Division in the
Attorney-General's office.

"ICSID Administrative and Financial Regulations 14 provides for
the periodic advance payments to be made to the centre by parties to the
ICSID arbitration proceedings in order to enable the centre to meet the
costs of such proceedings, including the fees and expenses of arbitrators,"
the letter says.

The letter was also copied to Simbi Veke Mubako, the former
Zimbabwean Ambassador to the United States.

Mubako has since left the diplomatic service and is currently
dean of the Law Faculty at the Midlands State University.

If Zimbabwe loses the case it will be expected to pay in excess
of US$15 million as compensation for improvements, land (title deed value)
and expropriated moveable assets. The claim is currently accruing interest
backdated to the time land was expropriated.

Zimbabwe was last year taken to the international court by Dutch
farmers for deliberately violating Bilateral Investment Promotion and
Protection Agreements (Bippas) signed between the governments when it
embarked on its emotive land reform programme.

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Tsvangirai loses suit by default

Zim Independent

A BULAWAYO High Court judge has passed a default judgement
against leader of the fractured Movement for Democratic Change (MDC), Morgan
Tsvangirai, in a case where he was being sued for a total of $80 million by
four members of a rival group in the party over defamation allegations.

The default judgement was passed two weeks ago after Tsvangirai
failed to file opposing papers in the suit filed by his former colleagues in
the united MDC last year.

High Court judge, Justice Maphios Cheda, granted the default
judgement to Welshman Ncube, Gibson Sibanda, Fletcher Dulini Ncube and Paul
Themba Nyathi.

Each of the applicants is demanding $20 million from Tsvangirai
in defamation charges.

Tsvangirai was taken to court by the four following the
publication of a story in the Star, a South African newspaper, where
Tsvangirai is alleged to have uttered statements the plaintiffs say were
defamatory of them.

Gift Chimanikire, who was one of the applicants in the case,
withdrew his claim after he defected to the Tsvangirai camp.

Court papers say Tsvangirai when addressing diplomats accredited
to Zimbabwe, after the split in the main opposition party, alleged that the
five leaders of the pro-senate faction were plotting with the Mugabe regime
to eliminate him.

"A minority in leadership positions tired of the democratic
struggle are ready to strike a diabolical deal with Zanu PF. Mercenaries
peddling selfish interests," the court documents on Tsvangirai's alleged
statements say.

"They wanted to weaken the MDC and give themselves new
credentials to enhance their political understanding with Zanu PF. They
participated in the senatorial elections in order to please Zanu PF as their

"They were involved in illegal activities trying to harm and
physically eliminate the defendant (Tsvangirai)."

Tsvangirai was represented in the case by Tendai Biti of Honey &
Blanckenberg. Contacted to comment on why his team did not file opposing
papers on the matter, Biti said the problem arose after their corresponding
lawyers in Bulawayo did not relay documents to them on time.

"We are using corresponding lawyers in the case and at one time
they did not send us some papers on time and that is the reason we lost our
defence but we are negotiating with the other team so that we can have our
defence back," Biti said.

The lawyer representing the four pro-senate MDC leaders,
Nicholas Mathonsi of Coghlan & Welsh legal practitioners confirmed that
Tsvangirai's team had not filed opposing papers and said he was close to
wrapping up the case.

"There is no way that Tsvangirai can successfully appeal without
our co-operation. We are actually on the verge of winning that case on a
technicality although there is still some ground to be covered," said

A default judgement is passed when one of the parties in a case
fails to appear in court or is served with summons and fails to indicate
interest in defending the case within the stipulated number of days.

If he or she indicates that he/she is willing to defend and then
delays to give a detailed response then the other party can apply for a
default judgement.

The case will resume on Thursday and will proceed without
further notice to Tsvangirai and his lawyers. - Staff Writer

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'Sound policies needed in Zim'

Zim Independent

Itai Mushekwe

ZIMBABWE can only fight the poverty stalking her people by
coming up with broad-based economic policies that will stabilise the economy
to create a better life for all, Swedish Ambassador to Zimbabwe, Sten
Rylander, has said.

Rylander made the remarks on Wednesday during a signing ceremony
for a SEK$3 million (approximately US$412 000) grant to the Macroeconomic
and Financial Management Institute of Eastern and Southern Africa (MEFMI)
for its capacity building projects in Zimbabwe and 12 other countries.

Rylander said President Robert Mugabe's government should take a
cue from Tanzania whose economy was in a tailspin a decade ago, but had
since become a successful model for many African nations due to sweeping
poverty reduction reforms.

"Without a good macroeconomic framework," Rylander said, "you
will never succeed in economic management and be able to fight poverty. That
is why some of us are praying for Zimbabwe to build bridges with the
international community."

He said it was not easy for regional oganisations such as MEFMI
to continue operating in Zimbabwe under the current hyperinflationary

He said learning through active networking was almost always a
very powerful instrument.

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AG orders probe into Zimpapers vehicle scam

Zim Independent

THE Attorney-General's office has ordered the police to
investigate Zimpapers on allegations of gross corruption in the company's
vehicle purchasing system that has cost the company millions of dollars.

Documents to hand show that acting Director of Public
Prosecutions Joseph Jagada last month wrote to one Assistant Commissioner
Nyathi at Harare Central instructing him to institute an investigation into
allegations of corruption at Zimpapers.

The AG's office was responding to a complaint from senior
Zimpapers officials who claimed the company was being invoiced money for new
vehicles when it was receiving second-hand cars.

"Can you please institute an investigation into the complaint
and if we can also be updated on the progress of the investigation," reads
Jagada's letter to Asst Commissioner Nyathi dated April 10.

Jagada also ordered the police to investigate the reinstatement
of Adolf Majome - Zimpapers' financial director - who was previously
arrested on allegations of corruption but the company later withdrew the

"If it is correct that Mr Majome was reinstated as the chairman
of the purchase committee, after his arrest on allegations of corruption
arising from his functions in the same post, then this raises eyebrows and
is a cause for concern. There is reasonable basis to warrant an
investigation," Jagada said in the letter.

Police spokesman Chief Superintendent Oliver Mandipaka said he
was checking the details. "You can phone me later after I have checked the
details," Mandipaka said.

Sources in the police force said Zimpapers group chief executive
Justin Mutasa was last week called in to record a statement on the alleged

The other high ranking official whose statement was recorded
last week is group internal auditor Andrew Chinyama, the sources said.

A source said the group's vehicle purchase system was skewed
with the CEO and the financial director being the only people to decide on
what to purchase, opening the system to abuse.

"The corruption charges emerged from the purchase of a Nissan
Hardbody 2.7D truck which was initially rejected by the group's vehicle
maintenance department as too old," the source said.

"The vehicle was taken back to the supplier, reconditioned and
resold as new to Zimpapers," the source said. - Staff Writer.

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Harare rates to go up 2000%

Zim Independent

Augustine Mukaro

THE Harare Commission will soon unveil a colossal 2007 budget
with a projected average increase of 2 000% in rates and water charges for
residents beginning next year.

However, the budget faces stiff resistance from residents who
have already started mobilising for street demonstrations against the
commission if the budget is approved without their consent as happened with
the current one.

The 2006 budget of $33 trillion was foisted on residents despite
their overwhelming objections.

Sources in the council's city treasury department said
formulation figures show that next year's budget is likely to be twenty-fold
last year's budget considering the ever rising prices of goods owing to
galloping inflation in the country.

"We have finished the formulation process and the proposals
would be tabled before a full commission anytime soon," the source said.
"Proposed figures show that it's a huge budget mainly due to expenses
required to finance the turnaround programme as well as increases in prices
of raw materials and commodities needed to improve service delivery," the
source said.

In November last year Harare unbundled the city's operations,
transforming city departments into 12 autonomous business utilities. The
units are owned by council and run along commercial lines. The plan allows
business utilities to enter joint ventures and smart partnerships,
technological transfers and strategies alliances with the private sector
where necessary.

The Reserve Bank had promised to provide $1,2 trillion (old
currency) to council to finance the unbundling process but froze the
facility after council failed to provide financially sound projects.

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CIO offers to buy Mandaza's Mirror stake

Zim Independent

THE Central Intelligence Organisation (CIO) has offered to
formally buy out Zimbabwe Mirror Newspapers Group CEO and editor-in-chief
Ibbo Mandaza from the company they wrested from him last year.

The move revives the bitter contest between the CIO and Mandaza
over the control of the media house. The fight for the papers has been going
on since August last year. Although Mandaza won a court order reversing his
illegal suspension and termination of benefits, he has not worked at the
Mirror since October last year as he was blocked from doing so.

In a new twist of events, Gula-Ndebele & Partners, who represent
Unique Investments, a CIO shelf company which has a stake in the Mirror,
wrote to Mandaza's attorneys Mandizha & Company on September 4 proposing an
out of court settlement.

"We write to you at the instance (request) of our clients Unique
World Investments in their capacity as one of the shareholders in the
Zimbabwe Mirror Newspapers Group," Gula-Ndebele & Partners said.

"Our clients instruct us that they would want to engage your
client, Dr Ibbo Mandaza, and all the interests in the Mirror he represents
with a view to negotiating an out-of-court settlement on all matters that
are currently pending or anticipated before the courts."

Gula-Ndebele & Partners said there were specific issues that its
client wanted resolved. "More specifically, our client wishes to make an
offer to your client with regards to the following and other issues as may
be relevant," it said: "the takeover of his shareholding; termination of his
directorship; termination of his employment as CEO and termination of his
involvement in the group in whatever capacity".

The lawyers said Unique was willing to negotiate although
Mandaza should bear in mind the Mirror was in a perpetual financial crisis.

"In this regard, our client wishes to solicit your client's
attitude towards this proposal. Should your client be amenable to the
proposal, it is our clients' view that both parties would need to put
together their various positions and offers for further consideration," they

"In making this overture, our clients implore your client to be
mindful of the dire financial straits the group has always and continues to
be facing. It is also our clients' expectation that should your client be
agreeable, it would be in the interest of all parties to hold in abeyance
any court actions between them in order to facilitate and create a conducive
environment for the intended negotiations. We await your earliest

On September 14, Mandaza's lawyers replied: "Our client's
position is that the key to unlocking meaningful dialogue on the issues you
raised lies in your clients. His position is that they have to demonstrate
their bona fides by owning up and paying his contractual dues, to date. We
requested him to compute them."

After Gula-Ndebele & Partners replied on September 27 clarifying
the issue of payment, Mandizha & Co wrote again on October 19, saying: "We
advise that our client has reason to believe your clients are insincere.
Consequently, we have been mandated to inform you, as we hereby do, that if
no concrete position is communicated to us by the 26th instant, we will
revive litigation." - Staff Writer.

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Govt fails Murambatsvina victims: Parly committee

Zim Independent

Clemence Manyukwe

THE government has failed to honour its obligation to provide
accommodation to victims of Operation Murambatsvina more than a year after
launching a campaign which a United Nations (UN) envoy said was carried out
with "indifference to human suffering", a parliamentary committee has said.

In its report presented in parliament on Tuesday, the
parliamentary portfolio committee on Local Government, chaired by Zanu PF
Mazowe West legislator Margaret Zinyemba, said government should build more
houses for the homeless bearing in mind that the demolition exercise "had
generated a lot of debate and criticism locally and internationally".

Last year's report by UN envoy Anna Tibaijuka said the
demolitions had left 700 000 Zimbabweans homeless and destitute and affected
a further 2, 4 million.

In the latest parliamentary report, the Local Government
committee said it had "noted that the initially announced budget of $3
trillion was fairly reasonable. However, government failed to honour its
obligation that would see the project through to completion."

It added that the housing project dubbed Operation
Garikai/Hlalani Kuhle was of critical concern to it.

"In terms of project implementation, no significant progress was
made, as funds provided were too little for any meaningful development to
take place. In fact, the secretary for the Ministry of Local Government
informed the committee during a briefing on the project's progress that no
progress had been made on most sites
visited by the committee during the previous session, " the
committee said.

It also said that the Regional, Town and Country Planning Act
must be reviewed urgently as some of the problems related to Operation
Murambatsvina were blamed on flaws cited in the Act.

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Bungling exam boards take standards down the drain

Zim Independent

Lucia Makamure

JEWS in the ghettos used to pour honey on their children's books
to coax them to read and learn.

If Zimbabwean parents were to prescribe as much as double the
dose of honey, they would still grapple to sustain interest among pupils and
students upset by incompetent examination boards that bungle the
administration of end of year tests with monotonous regularity.

Gone are the days when Zimbabweans used to take pride in their
academic qualifications. Then examinations were effectively administered and
the education system was internationally admired.

But writing examinations has become a nightmare in Zimbabwe.
Inefficiency has gradually crept into the process of writing, marking and
printing results.

Since the Zimbabwe Schools Examination Council (Zimsec) took
over the administration of examinations in 1998 as government indigenised
the tests, standards have plummeted.

A scandal involving the late Education minister Edmund Garwe's
14-year old daughter appears to have presaged the slide in the education
system, once touted as the pride of Africa.

Garwe resigned after his daughter leaked a Zimbabwe Junior
Certificate examination paper to friends and schoolmates at a high school in
the capital Harare.

This year primary school teachers in Kwekwe district are said to
have improvised by transferring answers from ordinary sheets to scanner
sheets for their students after there were delays in the delivery of the
scanner answer sheets.

Although teachers' representative unions say three Grade Seven
examinations were written before the centres had received scanner sheets for
the respective exams, Zimsec director Happy Ndanga confirmed that there were
delays but denied that teachers transferred answers for their students.

"There were indeed delays in the delivery of scanner sheets in
some areas, due to logistical problems," Ndanga said.

"However, when that happens there are contingency procedures
that are put in place to enable candidates to use ordinary sheets, which
will be marked manually. Teachers should never shade scanner sheets on
behalf of candidates, except in completing candidates' personal details."

Progressive Teachers Union of Zimbabwe secretary-general Raymond
Majongwe said what happened was highly unacceptable and Zimsec should be
made accountable. He said there was need for government to allocate more
money towards education in the national budget.

"They have compromised the whole education system," Majongwe

He said it was illogical to compel teachers to shade answers on
answer sheets for pupils on multiple choice questionnaires, saying this
comprised the ethics of any examination.

He said under normal circumstances the examination body should
not wait for the last minute to deliver stationery.

"Next time when the government plans its budget more money
should be allocated to education instead of security and defence as has
often happened in the past."

Papers have "leaked" weeks before they are written, resulting in
the postponement of some examinations.

In other instances, examination papers have been mixed up.

Such nightmares replicate themselves come the marking stage as
markers gripe over miserly allowances awarded by the examinations board.

Teachers marking Grade Seven examinations have already expressed
disgruntlement over the paltry allowances they are getting from Zimsec.
Teachers who are getting $20 for a script marked have complained that the
allowances are not worth the paper.

"I live in Chitungwiza and need about $1 000 in bus fare alone.
I also need money for food and with the money they are giving us I do not
think it's worth the effort for me to go for the marking," said one teacher.

All this illustrates the degree to which the examination board
has been losing its lustre. Zimsec has failed to live up to the legacy
bequeathed by University of Cambridge Local Examinations Syndicate.

Markers used to be housed either in hotels or at centralised
colleges when marking examination papers. This minimised flaws in
examination administration.

There have been incidents where students have claimed their
scripts were not fairly marked, as some teachers are believed to be marking
the exams under the influence of alcohol. There have been cases when results
were mixed up, with some people getting results for subjects they did not

The Higher Education Examinations Council (Hexco) is also slowly
losing favour in the eyes of many Zimbabweans as it is also failing to
deliver quality service.

Examinations at Hexco centres have for the past two years been
characterised by confusion. Examinations are delayed, papers get mixed up
and in some instances a subject ends up with two different test papers

Recently at Harare Polytechnic, business studies students had to
wait until after 8pm to write a paper that was supposed to have been written
at 2pm. Science Department students have lost 22 papers, Mechanical
Engineering students have lost eight papers and Art students have also lost
several papers.

Last year final year Mass Communication students were given a
wrong reporting paper on speech writing and had to wait for a whole week
until they could get a replacement paper.

Similarly, a press conference paper had to be postponed when the
invited guest failed to turn up. Library and Information students for the
same year had the shock of their lives when they were given two different
papers for the same subject. Harare Polytechnic is receiving one copy of an
examination and then they fax the paper to other centres which include
Bulawayo Polytechnic.

Harare Polytechnic principal Steven Raza declined to comment on
the issue but said examinations were underway.

The University of Zimbabwe has also not been spared, as the
college at the moment has no examination stationery. Lecturers are left with
no option but to dictate the questions for their students as happened
recently during a sociology multiple choice test paper.

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Home-based care reduces HIV prevalance rate: NAC

Zim Independent

Victoria Muringayi

THE National Aids Council (NAC) has attributed the decline in
the Aids prevalence rate to various projects such as the home-based care
system which deals with people living with the HIV/Aids virus.

NAC board chairman, Reverend Murombedzi Kuchera, said the
awareness campaigns being carried out by various stakeholders nationwide
were helping reduce the prevalence rate.

The prevalence rate for the HIV virus is now down at 18,1% from
the previous 20,1%, while projections point to a reduction to a single digit
rate by 2010," he said.

"Home-based care is one of the very important strategies in
national efforts to address challenges faced by Aids victims at home."

Zimbabwe has over 300 000 people who require anti-retroviral
drugs, but only 42 000 of them are receiving treatment. The remainder have
to be catered for through home-based care initiatives.

The NAC said it was receiving US$250 000 for anti-retroviral
drugs every month from the central bank to cater for those who cannot
survive without the drugs.

"We have anti-retroviral drugs that can cater for 42 000 people
who are on treatment and need the drugs constantly," Kuchera said.

"We are currently mobilising our resources so that we can source
funds for patients on anti-retrovirals so that everyone infected with the
virus receives the drugs."

Kuchera was speaking at a community home-based care certificate
award ceremony held in Harare last Friday by a non-governmental organisation
Jekesa Pfungwa/Vulingqondo.

Jekesa Pfungwa funnelled at least US$30 000 that it received
from Irish Aid through Zimbabwe Aids Network to offer community home-based
care to 20 monitors and 10 field officers throughout the country.

The money was used to buy bicycles, home-based care kits for the
monitors and the field officers to improve efficiency in the programme.

Jekesa Pfungwa deputy director Mabel Moyo said the community
home-based care course is the third that they have offered to the community
and the 20 monitor's role is to educate and give information to primary care
givers, who are family members taking care for the terminally ill.

"The home-based care monitors and field officers have undergone
a refresher training course which is a special programme, that was done
according to the national standards as required by the Ministry of Health,"
said Moyo.

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Farm invaders lose protection

Zim Independent

PRESIDENT Robert Mugabe has assented to the Gazetted Land
(Consequential Provisions) Bill of 2006, which repeals the Rural Land
Occupiers (Protection from Eviction) Act that shielded farm invaders.

State-sponsored land invaders will now be exposed to evictions
after they were used to campaign for Zanu PF in elections by occupying

The enactment of the law means that it is now punishable by law
to hold, use or occupy a piece of land that was gazetted for resettlement
purposes without lawful authority in the form of an offer letter from the
Minister of Lands.

Once a farmer is served with an eviction notice he would be
prescribed 90 days to vacate the land, failure to do which offenders will be
given a sentence not exceeding a week and will be evicted from the farm.

Mugabe announced this yesterday as he doled out long-term leases
of land which was confiscated from white farmers. He warned former white
farm owners not to expect compensation from the government. - Staff Writer.

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Stockbrokers face closure

Zim Independent

Paul Nyakazeya

THE country's 15 stockbroking firms face imminent closure
following High Court ruling dismissing the Zimbabwe Stock Exchange (ZSE)'s
appeal to have them exempted from paying Value Added Tax (VAT) backdated to
January 2004.

Most firms will not survive if the Zimbabwe Revenue Authority
(Zimra) forces them to pay the tax backdated to two years ago. Brokers told
businessdigest yesterday the 15 owed Zimra a combined tax bill of $700

The amount which includes interest and penalty would leave them
virtually insolvent.

"Payments backdated to 2004 could lead to a spate of company
closures, chase away investors and loss of confidence in the local bourse,"
said head of a securities firm who declined be named.

The 15 stockbrokers that face closure are Intermarket
Stockbrokers, FBC Securities (Pvt) Ltd, EFE Securities, Sagit Stockbrokers,
Imara Edwards Security, Renaissance Securities P/L, Fidelity Securities P/L,
M Lynton-Edwards Stockbrokers, Remo Investments Brokers P/L, Interfin
Securities P/L, Kingdom Stockbrokers P/L, Mast Stockbrokers, ABC
Stockbrokers P/L, New Africa Securities P/L and D Vrettos Stockbrokers.

Imara Edwards Securities was asked to pay $49,3 billion in May
this year but the amount has increased drastically over the past seven
months during which the brokers and Zimra were having court battles.

On Wednesday High Court Judge President Rita Makarau threw out
the stockbroker's appeal saying ZSE, their representative in the case, did
not have a legal basis to bring the case before the court.

Justice Makarau dismissed the case with cost, something that
would further hurt the purse of the brokers. Justice Makarau declined to
make a ruling on the merit of the case, saying she had to be satisfied that
the case was properly before the court.

In the case, the court had to determine whether the law exempted
stockbrokers from paying VAT and had locus standi to bring the application
before the higher court and whether the case was still pending before
another tribunal of competent jurisdiction, the Fiscal Appeals Court.

Analysts said there were now fears in the market that Zimra
might soon pounce on all registered stockbrokers, individually ordering them
to pay VAT backdated to January 2004. Some small firms might also not be
able to withstand the financial pressure to fight Zimra in the court.

Metropolitan Bank group economist, Brains Muchemwa said stock
broking firms would collapse if they make a one-off payment. "The Zimra and
the firms should reach a solution where payments can be made over a certain
period of time. A once off payment would render them insolvent," Muchemwa

Executives in the sector however told businessdigest late last
night that the brokers were planning to appeal against the decisions.
Although their lawyer Tendai Biti of Honey and Blanckenburg could not be
reached for comment, information gathered indicated that they would lodge an
appeal either today or early next week.

If the stockbrokers eventually lose the case it would mean that
investors who buy shares on the stock market would be taxed three times in a
single transactions - through stamp duty, withholding tax and VAT. This
three-tier tax system will also apply to small investors.

A stockbroker with a commercial bank said brokers were exempted
from paying this type of tax as per current VAT Act, Section 11 (a). The
Finance Act 2003 was amended, which effectively exempted all stockbrokers
from paying VAT.

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POSB to list on stock exchange

Zim Independent

Shakeman Mugari

WHILE the market is still digesting its surprise swoop on CFX
Financial Services two months ago the People's Own Savings Bank (POSB) has
pulled another shocker by announcing that it now plans to list on the
Zimbabwe Stock Exchange.

POSB chief executive, Admore Kandlela, said by 2008 POSB will be
listed on the stock exchange.

"When I joined POSB bank I had a personal mandate that by 2008 I
should have the people's bank listed on the market. I believe that target is
still achievable," Kandlela said.

Although he could not reveal the specific date for the listing,
Kandlela said the mass market bank has already started doing the groundwork.
"It is in fact one of our major aims that we have set for ourselves and we
are working towards that goal."

There are indications that the bank which has three million
depositors has already started working on the eventual listing with
information that that the parastatal is making moves to acquire government's
stake in CFX. Government owns 17% of CFX through Allied Financial Services
(AFS), a company set up by the central bank as part of efforts to revive
troubled banks. POSB is the second largest shareholder with a 14% stake it
got after it underwrote CFX's rights issue two months ago. Kandlela said
that top-level consultations have been made to discuss the issue but a
decision is yet to be made. The deal would make POSB the largest shareholder
in CFX with 31%-a situation which could create conditions for a reverse
listing for POSB.

"Remember the government got into CFX by default. They will not
be there forever. It's only logical that we take over," Kandlela said.

Kandlela said consultation regarding the deal had already
started but could not give the specific date of completion.

"There is no way they can remain there for good and we have been
bold enough to say it. We await their decision on that matter. We hear they
are consulting."

The deal will however not change much because government already
wholly owns POSB making it just a lateral transfer of shares from one state
company to another.

Analysts however say the acquisitions would enable the bank to
go on the market through a reserve listing. POSB has a total deposits of
$5,5 billion of which $4 billion is in savings. It shares in Pelhams,
Zimsun, Delta, Dawn Properties and OK Zimbabwe.

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Calm returns to banking sector

Zim Independent

Shakeman Mugari

CALM returned to the banking sector this week after the Reserve
Bank of Zimbabwe (RBZ) reversed its earlier directive forcing banks to
invest in Economic Stabilisation Bonds that was threatening to plunge the
sector into bankruptcies.

There has been uncertainty in the banking sector for the past
two weeks following the RBZ's order forcing commercial banks to invest 25%
of their balance sheet in five-year bonds and 20% in seven-year bonds.

The decision would have seen banks having 45% of their balance
sheet locked in long-term papers - five and seven years - making the banking
sector unviable.

The move sent shock waves in the financial sector with other
banks fearing that they might be forced into insolvency. Most banks had
already started feeling the pinch after they invested 20% of their monies in
the five year bonds.

Sources however told businessdigest that the central bank
relented on Wednesday after strong representations from the banking sector.
The central bank told bankers that it was no longer mandatory for banks to
commit 20% of their balance sheet in the seven-year bonds.

This means that banks are no longer under obligation to buy the

"The central bank representatives told us that it was no longer
mandatory for us to invest in the seven-year bonds," said a senior bank
executive who attended the meeting on Wednesday.

"They have also removed the 5% that we were supposed to invest
in five year bonds in addition to the 20% that we had committed on those

The reprieve will also apply to asset managers who had also been
instructed to invest 17, 5% in five year bonds and 12,5% in seven year
bonds. The decision was verbally communicated to the banks and there was no
written statement.

Bankers are however not celebrating as yet as they remain
cautious that the reprieve might be changed when RBZ governor Gideon Gono
returns from outside the country.

"We are happy that we have got the reprieve but we remain
worried because anything might change when Gono returns. So we are not sure
whether he will allow the decision to stand," said one banker.

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We are insolvent: Caaz boss

Zim Independent

Shame Makoshori

THE Civil Aviation Authority (CAAZ) this week said it has been
driven into insolvency by ballooning foreign debts that chief executive
officer David Chaota blamed on government's reluctance to settle.

At a pre-budget seminar in Harare on Wednesday, Chaota said some
of the debt has accrued from the 1980s and was complicating operations due
to threats that CAAZ assets might be confisticated by angry international

He pleaded with the Ministry of Finance to provide funds to pay
off the foreign debt in the 2007 budget scheduled for end of November.

CAAZ has been living under threats of international lawsuits and
has been hesitant to open accounts with the International Air Transport
Association (IATA) amid fears that the money could be garnished, Chaota

"If you look at our balance sheet you will see that we are
technically insolvent because of the debts," Chaota said.

"We cannot open accounts with IATA because the money would be
garnished. In 2004 we were sued by various international creditors because
of these debts," Chaota said.

CAAZ, like many other state enterprises, have been badly let
down by poor budgetary allocations and the tendency by Reserve Bank of
Zimbabwe (RBZ) governor Gideon Gono to initiate expansion
projects that he later reneges on, he said.

He chronicled how Gono recently released $630 million for one of
CAAZ's projects but immediately blocked access to the funds without

Buffalo Range Airport was allocated $8 million in the 2006
budget for expansion when costs for plans alone required $550 million.

CAAZ is carrying out multibillion dollar expansion and
refurbishment programmes at Harare International Airport, and Joshua Nkomo
and Victoria Falls International Airports.

The projects have been delayed on several occasions due to the
lack of funding.

Expansion of the Victoria Falls International Airport, which was
originally scheduled to be completed by the end of 2006, has just started.

Meanwhile tourism industry players at the pre-budget seminar
expressed impatience at government's delays in privatising parastatals that
have been feeding on government subsidies for a long time.

Last year Finance minister Herbert Murerwa promised to privatise
six parastatals to wean them from state influence and return them to
viability but two months before the end of 2007, none have been weaned off.

"It will be embarrassing that the minister will come back to the
people with the 2007 budget without accomplishing the promises he made last
year," queried Zimbabwe Tourism Authority chief executive officer Karikoga
Kaseke, but Ministry of Finance officials present at the meeting boasted
that Murerwa will not run short of words.

"He will not run short of words, he will tell the nation
something else this time around," they said.

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Noczim wants levy upped

Zim Independent

Shame Makoshori

THE National Oil Company of Zimbabwe (Noczim) is reportedly
putting pressure on government to review the Noczim debt redemption levy it
charges to private fuel companies to allow it to increase its waning

Private petroleum companies are paying about $1 for every litre
purchased from Noczim or imported as levy. Noczim, which has been battered
by a massive debt is arguing that the review is necessary to help it pay its
foreign debt and monthly obligations to the Bulawayo-Beitbridge Railway
(BBR) for using the railway line.

It is understood that the government had initially offered to
increase the levy to $25 per litre but sources this week said Noczim was
pushing for a much higher increase.

The Noczim debt redemption levy was introduced by the Finance
Act in 2003 to assist the company amortise its accumulated foreign debt that
it has battled to settle despite previously enjoying monopoly over fuel

If effected, the higher levy would precipitate fuel prices hikes
in Zimbabwe as petroleum companies would pass on the burden to end-users.
This means that people will have to pay more for the fuel that they get
through the official market.

There are indications that next year's budget scheduled for the
end of November will announce an increase in fuel prices. Private players
sell fuel at $1 600 per litre when Noczim's products are sold at $335 per
litre as the company receives hefty government subsidies.

Government this week gave Noczim chief executive officer
Zvinechimwe Churu the greenlight to work on the computations for
consideration before the 2007 budget is crafted.

Noczim is paying US$1,3 million in service charges per month
(about $267 million) to BBR and intends to use private players'
contributions to help it settle its own debts.

Most private players import fuel using road tankers.

Churu said despite paying the high fees to BBR it was collecting
less than $100 million per month through the levy.

He demanded that whenever petroleum companies hiked prices, the
levy should be adjusted and as exchange rates fluctuated, there should be
corresponding upward adjustments.

"We have accrued forex obligations in the national interest.
Noczim must be assisted to liquidate the debts by increasing the levy to
enable them to pay BBR. We rarely use that line," Churu told a pre-2007
budget seminar in Harare on Tuesday.

Petroleum companies told businessdigest this week that Noczim's
plans would cause viability problems as companies were already paying
uneconomical amounts in levies to compensate for Noczim's mismanagement.

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Govt red tape to blame for NRZ woes - WB

Zim Independent

Shame Makoshori

POOR management and government bureaucratic interference are the
major causes of the crisis obtaining at the National Railways of Zimbabwe
(NRZ), a recent, World Bank report has said.

The report titled Zimbabwe Infrastructure Assessment: Note for
Roads, Railways, and Water Sectors, said the NRZ suffered an eight
million-tonne slide in freight traffic between 1990 and 2005 due to poor
management and government interference in its operations.

It said NRZ's freight traffic declined from 14,4 million tonnes
in 1990 to 6 000 tonnes in 2005, precipitating massive losses in revenue.

The decline is an indication of the dire state of the parastatal
which has been haunted by financial problems and losses for the past two

The World Bank attributed the losses to "low revenue due to
carrying lower than freight traffic on offer, a rigid and inefficient tariff
structure, excess staff levels and poor utilisation of assets."

The NRZ was however confident that its depleted fleet would move
nine million tonnes of cargo this year, the report said warning that to
achieve increased margins, radical reforms and prudent policies were
imperative to enable the NRZ to play its role in national and regional

"The NRZ is not free to take action without government approval.
The problem would not be serious if government agreed to compensate the NRZ
for losses incurred because of being forced to operate loss-making
services," the report said.

The Bretton Woods institution blamed the crisis on failure by
government to compensate the NRZ for public service contracts despite
provisions in the NRZ Act for compensation on such services.

Since 2000 for instance, government has provided low-cost
commuter services in Harare and Bulawayo, plunging the perennial loss-maker
into cash-flow problems that precipitated a marginal revenue increase of
375% in 2004 against expenditure increases of 1 017%.

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Sunrise gobbled $8,6b

Zim Independent

Paul Nyakazeya

THE Reserve Bank of Zimbabwe's Project Sunrise gobbled a massive
$8,6 billion ($8,6 trillion in old currency), deputy Minister of Finance,
David Chapfika, said last week.

Responding to a question from Mberengwa West MP, Joram Gumbo,
during a question and answer session in parliament on Thursday last week,
Chapfika said the Reserve Bank had used $8,6 billion on the countrywide
operation which lasted for almost a month.

"The operation cost $8,6 billion revalued, $4,6 billion of which
was for capital expenditure and $4 billion for printing of new bearer
cheques and other operational expenses," Chapfika said.

Chapika said at least 304 vehicles were acquired for the

Out of about $45 trillion (old currency) that was in circulation
at the time of launching Project Sunrise, a total of $35 trillion (old
currency) was accounted for through re-banking withdrawals into the Reserve
Bank coffers.

"As at August 22, 2006, which was the cut-off date for the
change-over, at least $35,1 billion (revalued) had been collected from the
public while at least $10,6 billion worth of old bearer cheques could not be
accounted for various government ministries and departments," Chapfika said.

Chapfika said the Reserve Bank had subsequently written off that
amount from its books, adding that it had the technical effect of writing
off costs incurred during the operation.

The period under review also netted a total of 9 320 cases with
a value of $1,4 trillion (old currency) whose owners were said to have
failed to account for the money at the close of business on August 21.

At the launch of Project Sunrise the Zimbabwe dollar was
devalued against the US dollar by 60% from $101 to $250.

On July 31 Reserve Bank governor said Project Sunrise Two which
would include the introduction of a new currency replacing bearer cheques
would be launched "soon".

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Zim tobacco output seen declining further

Zim Independent

Paul Nyakazeya

ZIMBABWE'S tobacco production is likely to slump further next
year on information that the country has only managed to plant half the
hectarage that has been targeted for the 2006-7 season.

The Zimbabwe Tobacco Growers Association (ZTGA) said a total of
40 000 hectares of tobacco has been planted out of the targeted 80 000
hectares due to the shortage of essential inputs such as fertiliser and
diesel for tillage equipment.

ZTGA president Julius Ngorima said the decline in the amount of
hectarage planted would result in a sharp decline in tobacco production next

"A total of 80 000 hectares was targeted to be put under tobacco
this year. 40 000 has been planted due to the problems most farmers faced
such as lack of inputs and shortage of diesel," he said.

Tobacco production in Zimbabwe has declined by 170,63 million kg
from an all-time high of 236,13 million kg recorded in 2000 to 55,5 million
kg which went under the hammer this year.

Ngorima said a significant number of farmers had prepared seed
beds for transplanting, but the shortage of inputs and financial resources
held them back.

He said it was highly unlikely that a target of 70 million kg in
the next farming season will be met.

"The regional cut-off date for this season's tobacco is November
20. I do not think there would be a significant increase to the amount of
hectarage between now and the deadline (cut-off date)," Ngorima said.

Any tobacco that is planted after November 20 is regarded a late
crop and is usually not ready for harvest during the next selling season
which usually starts in April or May.

Due to the shortage of inputs, an average of between 800 and 1
000 kg per hectare was expected this season, down from the normal 2 000 kg.

Zimbabwe sold a total of 55,5 million kg of flue-cured tobacco
worth US$110,7 million in the 2006 selling season.

The Tobacco Industry and Marketing Board (TIMB) this week said
some 55 466 689 kg of tobacco went under the hammer at an average price of
US$1,99 per kg.

The amount sold represents a remarkable decline from the 73 376
990 kg of tobacco worth US$118 165 025 sold at an average price of US$1,61
during the same period last year.

Tobacco production in Zimbabwe has been declining over the years
from a peak of 236,13 million kg in 2000 to the current levels due to
shortage of inputs and recurrent droughts among other factors.

In 2001 about 202 million kg went under the hammer while
165,84kg, 81,81kg and 69 million kg were sold in 2002, 2003 and 2004

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OK on a roll

Zim Independent

OK Zimbabwe's revenue rose by 1 180% to $22,382 billion for the
year ending September 30, from $1,749 billion recorded during the same
period last year despite having most of its products controlled against
rising input costs.

During the period under review the retail giant lamented the
manner in which price monitoring and controls of commodities was carried

"Price controls remained for three basic products; namely
maize-meal, flour and bread while 16 other products remained on monitored

"However, in the latter part of the period under review there
appeared to be confusion in the enforcement of the law on controlled goods
as, on occasions, no distinction was made between controlled, monitored and
uncontrolled products," said OK Zimbabwe in a statement.

Operating profit stood at $2,045 billion from $181 million
achieved last year.

In spite of negative real returns rampant on the money market,
the group recorded a 2 020% increase in net interest income to $1,346

Sales growth of 1 261% was ahead of average official inflation
of 1 107% but below average internal inflation of 1 670%.

Gross margins decreased to 21,44% from 24,69% the prior year due
to the adopted sales mix and managed approach to replacement pricing.

The company said an operating income ratio of 9,73% was
consistent with the drop in gross margins. - Staff Writer.

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Paranoia grips govt

Zim Independent

Clemence Manyukwe

GOVERNMENT is becoming increasingly paranoid hence its intention
to introduce new communications regulations that have been described as part
of a grand scheme to eavesdrop on private correspondence and control the
flow of information.

Analysts said this week the measures were consistent with its
failed bid to establish a one-party state and growing ties with China where
the Internet is strictly monitored.

The introduction of the regulations where state-owned Tel*One
will have a monopoly over all foreign currency to the detriment of private
cellular firms Econet Wireless and Telecel further confirms government's
desire to reap where it did not sow.

This week the High Court suspended the operation of Statutory
Instrument 70/06 that sought to stop a multiple gateway system through
termination rates for international traffic favourable to Tel*One pending
the outcome of a constitutional appeal to be lodged by Econet and Telecel
within the next two weeks.

In the court case, the Postal and Telecommunications Regulatory
Authority of Zimbabwe (Potraz), Transport and Communications minister
Christopher Mushohwe, and Tel*One are the first, second and third
respondents, while Econet is the sole applicant.

Telecel also went to court separately on the same issue but is
expected to make a joint constitutional appeal with Econet.

Analysts said this week the intention to ensure that Tel*One
gets all the foreign currency falls in line with other similar projects such
as the banning of 16 money transfer agencies last month by the Reserve Bank
of Zimbabwe (RBZ). The RBZ excluded these institutions from earning hard
currency being remitted home by Zimbabweans in the diaspora.

A telecoms expert on Monday said the predominant reason in
government wanting all communications to go through one gateway was to spy
on private messages.

"They are ill-advised," he said. "They believe that if calls
come through one gateway operated by Tel*One they could easily intercept
them. That is the predominant reason."

The attempt to spy on messages comes at a time when government
has withdrawn the Interception of Communications Bill and replaced it with a
consolidated new version that has been referred to the Parliamentary Legal
Committee (PLC) chaired by Welshman Ncube.

The telecoms expert said even if the latest regulations were to
come into effect, government would not have control of all the messages
coming into or going out of the country as another network called "packet
switched network" (PSN) or Internet protocol (IP) did not need a gateway.

The PSN is used by Internet service providers while cellular
firms use what is called a circuit network.

The expert said one of the problems of routing all
communications through a gateway controlled by Net*One was that the
loss-making parastatal may default in paying international networks
resulting in Zimbabwe being cut off from the rest of the world.

In September this year Net*One was disconnected from the
international link, Intelsat, thereby affecting Internet services after
failing to pay a US$710 000 debt for both Internet and voice link for the
period April to end of June.

"The other reason for the regulations is that they want to
protect the revenue base of Tel*One. They want to get hold of all the
foreign currency," the expert said.

In its court application that led to the suspension of Statutory
Instrument 70, Econet exposed government's defiance of court orders,
particularly a 1995 Supreme Court ruling which authorised the company to
route traffic through its own international gateway after breaking the
Tel*One's monopoly.

The court application also brought to the fore government's
penchant for total control and mistrust of free enterprise. Often,
government has resorted to the use of "the element of surprise" to deal with
those concerned. Such a choking knack for control flies in the face of
indigenisation and belies government's commitment to black empowerment.

Econet CEO Douglas Mboweni said his company was surprised to
receive a letter from Potraz advising them of the coming on stream of
Statutory Instrument 70 that the mobile phone operator was supposed to
implement even before consultations were concluded.

Said Mboweni in response to the Potraz instruction: "Applicant
is entitled to route its own traffic through its international gateway. I
must point out that this was a compromise position to the original court
order that granted the applicant unrestricted right to 'move traffic within,
into and from Zimbabwe'."

He said government has over the years tried to usurp Econet's
right as guaranteed by provisions of its licence.

Mboweni said three years ago Potraz, Net*One and the police
attempted to shut down Econet's international gateway without a court order
or warrant and the High Court in July 2003 offered Econet protection against
threats to withdraw its licence.

"In January, 2004 the 1st and 2nd respondents promulgated
Statutory Instrument 18 which sought to reintroduce the monopoly that had
been struck down in December 1995 by the Supreme Court," Mboweni added.

"This in effect amounted to an amendment of the applicant's
licence provisions without due process and without following proper licence
amendment procedures."

Political analyst Eldred Masunungure drew parallels between the
regulations and the banning of 16 money transfer agencies last month by the
Reserve Bank of Zimbabwe that was done without prior notice.

Announcing the ban, central bank governor Gideon Gono said:
"With immediate effect, all money transfer agencies are cancelled. All local
accounts for these entities should be closed." The government used the same
tactic when destroying people's homes and informal businesses under its
internationally condemned Operation Murambatsvina last year.

Masunungure said by coming up with the regulations, government
was trying "to kill two birds with one stone": reintroduce monopoly in the
telecoms sector and get all the foreign currency.

"It is driven by the government's monopolistic impulse. It is
more about consolidating its monopoly on the telecoms sector, the forex
dimension is secondary," said Masunungure.

He added: "If you do not have a competitive mind, it means that
those that are efficient are a threat. It is consistent with the original
intention to establish a one-party state. The idea is deeply ingrained in
government and Zanu PF."

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Whatever happened to Mutasa?

Zim Independent

By Trevor Grundy

FIFTY years ago he was a deeply Christian young man and black
nationalist working round-the-clock on a multi-racial farm that was famous
in liberation circles, and beyond, and hated by Rhodesia's white minority

He became a living legend among liberal Christians by helping to
make Cold Comfort Farm into a first class agricultural training ground and a
psychological liberation centre that was an early staging post on the long
march from colonial oppression in Rhodesia to majority rule in Zimbabwe.

"A man of high integrity and Christian character," said Guy
Clutton-Brock, the Welsh-born champion of black freedom who became Zimbabwe's
first and only official white hero when President Robert Mugabe buried his
ashes at Harare's Heroes Acre in 1996.

"He never feared to speak his mind and he was always a sensitive
leader, a man of vision, an optimist with a profound belief in his fellow
man regardless of race, colour, creed."

The man of whom Clutton-Brock spoke so highly now holds high
rank in the government of President Mugabe. As minister of national security
and head of the secret police, Didymus Mutasa is one of the most feared and
ruthless men in Zimbabwe, second in power only to Mugabe.

Mutasa, praised by the devout Clutton-Brock as a Christian of
integrity, sensitivity, vision and love for all his fellow men, achieved
international notoriety in 2002 when he was asked how he felt about three
serious problems confronting Zimbabwe.

The first question concerned the fear in that year that severe
drought might result in the death of half of Zimbabwe's 12 million
population, many of them supporters of the then confident opposition
Movement for Democratic Change (MDC). The second concerned the thousands of
Zimbabweans who die each week from Aids. And the third related to the mass
exodus from the country of skilled blacks and whites.

Mutasa replied: "We would be better off with only six million
people, with our own (ruling party) people who supported the liberation
struggle. We don't want all these extra people."

Thus spoke the man who had once been a byword as the kind face
of the new society to come and who was described by Diana Mitchell in her
book Nationalist Leaders in Zimbabwe as "an essentially gentle and
infinitely reasonable man".

British overseas development minister at the time, Clare Short,
said: "To welcome the death of nearly half the people in a country is
unforgivable. No one should forgive him (Mutasa)."

And leading Danish academic development expert Amanda Hammar
commented: "Mutasa's infamously stated desire to discard surplus populations
has resonance with historic precedents such as National Socialism in Germany
and its translation into routinised governmental annihilation."

It is little wonder that many Zimbabweans ask how the man their
history presented as a near-saint is now at the centre of a web of state
violence and alleged corruption. Who, they wonder, is the real Didymus Noel
Edwin Mutasa?

Back in the 1960s and 1970s, Mutasa was the close friend of the
Anglican lay missionary Clutton-Brock, hated with his wife Molly by the
white farming community as "communist troublemakers". They worked together
at Cold Comfort Farm, a multi-racial cooperative where farming skills were
learned and political ideas discussed endlessly.

A young black intellectual, Robert Mugabe, also became a close
friend of Clutton-Brock, who was expelled from Rhodesia in 1971 for his
criticism of the country's de facto racial apartheid. Hundreds of Africans,
including Mutasa, wept at the airport as he left.

Supporters said of Clutton-Brock that his only offence was to
turn "yes men slaves" into independent human beings. When he died, Mugabe
attended the memorial service at the Church of St Martin's in the Field in
London and was given Clutton-Brock's ashes to be taken to Harare. With
Mutasa by his side, Mugabe supervised the burial of the ashes at the North
Korean-built Heroes Acre. Clutton-Brock is the only white person to have
been buried there.

Mutasa was born in the eastern Zimbabwe town of Rusape in July
1935, the sixth child of a devout Christian couple.

In her 1982 book, Diana Mitchell, now living in Britain, said
Mutasa suffered as a young man because he was appalled by the unfairness of
Rhodesia's land ownership system. "He attempted to evade the worst effects
of the Land Apportionment Act and African landlessness by starting up the
Cold Comfort Farm Society with the patronage of white landowners," she

Mitchell, a campaigner for Rhodesia's short-lived multiracial
Centre Party, said Mutasa was a beacon of hope half a century ago when he,
Clutton-Brock, Michael and Eileen Haddon, white liberals who donated their
land for the creation of Cold Comfort Farm, and two renowned blacks
nationalists, James Chikerema and George Nyandoro, worked together to
improve African farming methods and then form the African National Congress.
The ANC campaigned for an extension of the franchise, but was banned within
two years of its birth.

Mitchell said that in those days Mutasa was "a man of gentle
demeanor, distinguished and fine-chiselled in appearance" who sank his own
money into Cold Comfort Farm after receiving a "golden handshake" when he
quit his job as a civil servant.

While working in partnership with Clutton-Brock to teach black
people modern agricultural techniques on small-scale farm units around Cold
Comfort Farm, Mutasa also became deeply involved with the World Council of
Churches. His cleverness at fund-raising was recognised by various of the
emerging post-ANC nationalist parties.

In 1970, as racial tension grew and as the war against white
rule began, the Cold Comfort Farm Society was disbanded by the white
government. Mutasa was arrested and held for two years in solitary
confinement at Chinhoyi Prison before being transferred to Salisbury Remand
Prison where he rubbed shoulders with Mugabe and the fiery nationalist Edgar

After his release, Mutasa studied in the central England city of
Birmingham on a British Council scholarship and in 1976 joined Mugabe and
Tekere as a member of the Zanu liberation forces based in Mozambique.

He returned home shortly before Zimbabwe's Independence in 1980
to organise the February elections, which saw Mugabe come to power and
Mutasa's appointment as speaker in the new black-dominated parliament.

Though most Zanu ideologues will no longer admit it, Zionism
greatly influenced the nationalist movement during the 1960s and 1970s and
Israel provided the exiled Zanu with some funding.

Between 1980 and 1990, Mutasa maintained his reputation as a
fair man, full of charm and integrity as parliamentary speaker.

A major transformation was apparent by 2000 when Mugabe, furious
that white commercial farmers had funded the opposition MDC, incited his
supporters to invade farms and drive off their owners, triggering a
catastrophic and continuing economic collapse.

In that same year, Mutasa was appointed Anti-Corruption
minister. He stayed in the job for three years watching and doing little as
a wave of alleged corruption swept higher and higher through government and
the top reaches of the judiciary, defence forces, police and civil service.

Once profitable commercial farms confiscated from whites were
among the main prizes taken by the new elite. Mutasa appropriated one of
these farms in eastern Zimbabwe for himself and independent newspapers
documented extensively how he and other ministers looted other farms of
billions of Zimbabwe dollars worth of expensive equipment for resale or use
on their own properties.

In May 2004, this once "kind and gentle" man kicked opposition
MP Roy Bennett in parliament after Bennett was involved in a scuffle with
Justice minister Patrick Chinamasa.

Bennett, who was loved by his black constituents in the Eastern
Highlands town of Chimanimani in much the same way as Clutton-Brock had been
loved half a century earlier, had seen workers on his coffee estate killed
and raped by soldiers and by supporters of Mugabe's ruling party.

He therefore became incensed when Chinamasa called his forebears
"thieves and murderers" and rushed across the floor of the house and knocked
the minister to the ground. The Zanu PF-dominated parliament sentenced
Bennett to 15 months imprisonment in prison, where he lost 27 kilogrammes in
weight before his eventual release.

Mutasa went unpunished for his counter-assault and less than a
year later he became the second most powerful man in the land when Mugabe
appointed him Minister of National Security and Land Affairs, positions that
made him chief of the Central Intelligence Organisation (CIO) and gave him
responsibility for the country's controversial, chaotic and violent land
reform programme.

In May 2005, in one of the earliest exercises of his new powers,
Mutasa launched Operation Murambatsvina, in which soldiers, police and
government militias used extreme violence to destroy the homes of hundreds
of thousands of poor people on the outer edges of the country's towns and

Mutasa presented Murambatsvina as a regeneration and renewal
scheme to "clean up" urban areas. But most people who lost their homes were
opposition supporters, and nearly a year-and-a-half later virtually nothing
has been done to provide new homes for the estimated 700 000 to a million
people who watched their houses being bulldozed, sledgehammered and set

Anna Tibaijuka, the special envoy of United Nations
Secretary-General Kofi Annan, lambasted Mutasa's operation as inhuman and a
breach of national and international human rights laws.

Emboldened by the "success" of Murambatsvina, Mutasa, with the
power of the much-feared and ubiquitous CIO as his weapon, began threatening
to "physically eliminate" government opponents. To this end, he was accused
by the remaining independent press in Zimbabwe of slapping a police officer
in his home constituency of Rusape and of assaulting a man who dared to
challenge his nomination as the Zanu candidate for Rusape.

When Walter Marwizi, a reporter for the independent weekly
Standard, investigated alleged corruption in the national security minister's
home province, Manicaland, Mutasa threatened the journalist: "I will deal
with you ruthlessly if you don't tell me your source (of the corruption
story). Make no mistake. I am sending my operatives and they will do a clean

Quietly, in recent weeks, Mutasa has relaunched Operation
Murambatsvina, with yet more humble homes being torn down in urban suburbs
by powerful organs of state.

Mutasa, who had once worked with Clutton-Brock, the Haddons and
other devout white liberal Christians, to carve out an island of tolerance
in a sea of bigotry and [ends here...]

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This is how the rot begins

Zim Independent

By Dele Olojede

I'VE told some parts of this story before, but I feel it is
worth repeating and you will soon see why: a few years ago Hugh Masekela was
at our dinner table in Johannesburg, having called my wife to say he felt
like some eba and egusi soup, a reminder of those days in the 70s when he
spent time hanging out with Fela Kuti at the Africa Shrine in Lagos.

As the evening progressed and we all drank perhaps a little bit
too enthusiastically, he told the story of his encounter with Nigerian
police at a roadblock late one night on his way to a gig at the Shrine.

Of course, in the mid-70s, police routinely collected "toll" in
nighttime shakedowns of hapless drivers, and they did the same to the
intrepid trumpeter and composer. He paid as a matter of convenience, but on
his way back to his hotel at about 4am, the same police made yet another
demand of him.

Bra Hugh protested that this, in effect, amounted to double
jeopardy, to which the police retorted: "Oga (Sir), that time, you dey go.
This time, you dey come!"

A roar of laughter erupted around our table at this very
Nigerian story. But recently, in the telling of Bra Hugh's story, I began to
see the incident as an early indication of what Nigeria was to become - a
poster child for corruption and mismanagement, stuck in a hole from which it
is now attempting, with some vigour, to extricate itself.

It is the seemingly little things - the brazen shakedown at the
police roadblock; the easy justification of misconduct by highly placed
officials; the speaker of South Africa's parliament accompanying a convicted
felon to jail as a mark of solidarity - that often foreshadow the calamities
to follow.

In the heady boom times of the 70s, the Nigerian elite by and
large laughed off the indicators of corruption then slowly gnawing away at

After all, literature flourished. The travelling theatre was in
full cry. Music rang clear from the streets of Lagos and other cities.
Petrodollars gushed so freely that the Nigerian government began paying the
bureaucrats of cash-strapped Caribbean island nations.

But in time the country wobbled dangerously and very nearly
collapsed under the weight of institutionalised graft perfected by the
regime of General Ibrahim Babangida, later followed by the depravity and
murder that characterised the years of General Sani Abacha.

A proud, some might even say arrogant, "giant of Africa" had
been brought to its knees, making the country's current attempts to revive
itself an exceedingly difficult undertaking.

In South Africa's highly charged political environment, where
loyalty to a particular person leads grown men and women to find a ready
excuse for despicable conduct, the lesson from Nigeria and elsewhere is
simple: good countries don't magically stay that way.

On the contrary, the evidence is overwhelming - in Nigeria,
Zimbabwe, Ivory Coast or any number of countries in our corner of the
Earth - that good countries often go bad when citizens fail to set high
standards for the conduct of public officials.

The renewed attention to the global fight against corruption,
pushed in large part by the World Bank under Paul Wolfowitz, is particularly
important for Africa, where some studies suggest that about US$148 billion
is lost every year, either directly to theft or indirectly through lost
investment. As Kenya's former anti-corruption czar, John Githongo, said
recently at a forum in Singapore, "corruption is the most efficient engine
for manufacturing poverty".

No one needs be defensive about the focus on corruption and its
devastating impact on Africa - it is not to single us out, but only to focus
our minds on what ails us.

The good news is that Africans are not culturally or genetically
predisposed to tolerating corruption; the evidence to the contrary is pretty
much incontrovertible, in the honour system that characterised daily
exchange among ordinary people up and down the continent.

Another good sign is that, in several African countries today,
the fight against corruption is being waged internally by a new wave of
reformers, using special law-enforcement tools such as that headed by
Githongo in Kenya, and the Scorpions in South Africa.

In Nigeria, it is said that "the fear of Nuhu is the beginning
of wisdom" - in reference to Nuhu Ribadu, the courageous head of Nigeria's
equivalent of the Scorpions, who daily confronts the country's
long-entrenched thieving classes.

The bad news is that our civic institutions are still weak and
our politicians, by and large, remain rapacious. In fact, with a few notable
exceptions, including in South Africa and perhaps Botswana and a handful of
others, the government typically is the number one obstacle in the path of
most Africans in their daily struggle to secure a better life for themselves
and their children.

Continuous political reform is crucial to reshape our government
into enablers of citizens, the makers and enforcers of the law, the
guarantors of justice and equality - not our nannies or the managers of our
football teams or sugar plantations or airlines. The government must focus
on improving its capacity to make and enforce the law and smooth the system's
inevitable imbalances.

It is common cause that South Africa has one of the world's most
enlightened constitutions, protecting every right imaginable, and carefully
balanced to insure the interests of its citizens. But even a fine
constitution is a piece of paper only, if important segments of the young
nation's leadership exhibit worrying signs of poor judgement, ethical lapses
and permissiveness. The polarising case of Jacob Zuma, who remains the
deputy president of the ANC, is but one example.

It would seem that the bar for acceptable conduct nowadays is
being continually set low. In some self-respecting societies, the mere
appearance of misconduct or poor judgement is enough to force the
resignation of a public official. In South Africa, the loudest voices are
insisting that only a criminal conviction is bad enough to warrant the
removal of a public official.

And, sometimes, not even then.

Look at the South African parliament and the case of its members
convicted of fraud.

This soft bigotry of low expectations, to paraphrase a
not-very-popular occupant of the White House, is the only rational
explanation why Baleka Mbete, the Speaker of Parliament, chose to accompany
Tony Yengeni recently to the prison gates as a mark of her solidarity.

In the increasingly anything-goes environment that some desire
to foist upon us, this is deemed a minor issue. But it is nothing short of
catastrophic, and not only symbolically.

The sight of the country's chief lawmaker so flagrantly
demonstrating her solidarity with a convicted felon - telling the country,
in effect, that the conviction is immaterial - is a clear demonstration of
the speaker's lack of understanding of her position, or the central role in
South Africa's life represented by the country's most important lawmaking
body, which she heads.

It also shows a troubling lack of concern for either propriety
or common sense. After all, Yengeni may be a nice man and a significant

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