Air Zimbabwe, which said it was operating at a loss of US$4 million a month was forced to send its workers on forced leave at half their benefits until they were recalled.
The airline had been surviving on off-budget support from the Reserve Bank of Zimbabwe but this had dried up following the formation of the inclusive government which stopped the quasi-fiscal operations of the central bank.
Workers saw the move as the signal of impending layoffs that could target as many as two thirds of the company's 1 400 employees.
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SUBJECT: ZIM NOTES 05-29-09
SUMMARY – Topics of the week
– Post Welcomes CODEL to Zimbabwe
– Gono Retains Backing of Mugabe and Service Chiefs
– ZANU-PF Sets Up Succession Committee
– Msika to Retire?
– AG's Office Still Pursuing Women, and Lawyers, and Journalists (oh
– Free Press Still a Distant Goal
– Pentecostal Pastor Abducted, Then Released
– Land Reform Threatens Conservancy
– Chiadzwa Footage Hits the International News
– Local Pharmaceuticals Firm to Acquire South African Company
– Diamond Mine Re-Capitalizing
– Winter Wheat Crop Hampered by Funding Shortage
– Property Companies Record Increase in Rentals
– Troubled Air Zimbabwe Sends Workers on Forced Leave
– Development Bank of SouthernAfrica in Loan Negotiation with
– Quote of the Week
On the Political/Social Front
Â¶1. Post Welcomes CODEL to Zimbabwe: A Congressional delegation led
by Representative Donald Payne (D-NJ) is arriving in Harare this
weekend for several days of meetings with senior government
officials, the donor community, and civil society and business
leaders. Representative Payne is currently the chairman of the
House Subcommittee on Africa and Global Health and a past chairman
of the Congressional Black Caucus.
Â¶2. Gono Retains Backing of Mugabe and Service Chiefs: In the
continued struggle over the future of RBZ Governor Gono, Mugabe
spoke out in support of his long-time personal banker this week
saying that he wasn't going anywhere. See Harare 447. Vocal
support also came from the Service Chiefs, who have benefited from
many of Gono's illegal activities, including the farm mechanization
scheme that saw high-ranking officers receive free farm inputs and
equipment. On May 26, Vice Air Marshal Henry Muchena warned, "If
you keep harassing Gono, we will take matters into our own hands."
Â¶3. ZANU-PF Sets Up Succession Committee: ZANU-PF spokesman Ephraim
Masawi confirmed on May 28 that his party held an extraordinary
politburo meeting which created a committee to deal with the
controversial issue of who within the party will eventually succeed
Mugabe. The committee is led by party chairman John Nkomo and
includes rival faction leaders Joyce Mujuru and Emmerson Mnangagwa.
Though local political analysts say a successor is unlikely to be
named anytime soon, the issue may again rise at this year's December
ZANU-PF party congress.
Â¶4. Msika to Retire?: According to The Zimbabwe Independent,
longtime ZANU-PF fixture, Vice-President Joseph Msika is on the
verge of retiring due to deteriorating health and the succession
problems within ZANU-PF. However, Mugabe is allegedly reluctant to
allow him to retire, preferring to keep him in office for life as
happened with Joshua Nkomo and Simon Muzenda.
Â¶5. AG's Office Still Pursuing Women, and Lawyers, and Journalists
Q5. AG's Office Still Pursuing Women, and Lawyers, and Journalists
(oh my!): The Magistrate's Court was busy on Thursday morning with
three political cases. 8 alleged WOZA women and two ZLHR lawyers
were acquitted on charges of disturbing the peace in February.
Separately, magistrate Catherine Chimhanda heard arguments in human
rights lawyer Alec Muchadehama's remand hearing for allegedly
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obstructing justice when he secured the release of three of the
abductees on bail back in April. He may face trial on June 17.
Chimhanda also ruled that the two journalists from The Zimbabwe
Independent will stand trial on June 16 for allegedly publishing
falsehoods. Recently, Chimhanda has been the designated magistrate
in numerous political cases and has consistently sided with the
State, leading many to believe her objectivity has been
Â¶6. Free Press Still a Distant Goal: Despite a recent pronouncement
by Prime Minister Tsvangirai that foreign and local journalists did
not need to possess a registered press card to report in Zimbabwe,
on May 23 the ZANU-PF led Ministry of Media, Information and
Publicity told all reporters they would be required to apply for
press cards from the commission. The cards cost up to 2,000 rand
(US$250) and issuance is not assured.
Â¶7. Pentecostal Pastor Abducted, Then Released: A prominent
Pentecostal pastor was abducted on May 26 by men in a white vehicle.
He was released the next day and remains in hiding. He has been an
outspoken supporter of the MDC.
Â¶8. Land Reform Threatens Conservancy: ZANU-PF heavyweights in
Masvingo are seeking to establish forced partnerships with land
owners in the Save Valley Conservancy. The Conservancy is home to
20 percent of Zimbabwe's rhinos. Rhinos have thrived in Zimbabwe's
private conservation areas, largely due to the massive private
investments made by landowners. See Harare 444.
Â¶9. Chiadzwa Footage Hits the International News: A team of Canadian
journalists recently visited the diamond fields of Chiadzwa. They
interviewed the Minister of Mining, Obert Mpofu, and one of the men
who says he helped with the mass grave that the government continues
to deny. See the story online: http://www.
Economic and Business News
Â¶10. Local Pharmaceuticals Firm to Acquire South African Company:
Pharmaceuticals manufacturer CAPS Holdings Ltd is about to acquire
an unnamed South African pharmaceutical company in a share swap deal
that will see CAPS issuing new shares for the project. The shares
will be registered on the Johannesburg Stock Exchange's Pan African
Â¶11. Diamond Mine Re-Capitalizing: River Ranch Diamond Mine
announced that it will invest US$15 million in mine development and
exploration which will double output from the current 30,000 tons of
rock a month to 70,000 tons. The funds will be sourced from
shareholders. 20 percent of River Ranch is owned by retired general
Solomon Mujuru, who gained his stake at the expense of a local
company, Bubye Minerals. Bubye contested the ownership change but
was thwarted by the Zimbabwean courts.
Â¶12. Winter Wheat Crop Hampered by Funding Shortage: Wheat planting
Q12. Winter Wheat Crop Hampered by Funding Shortage: Wheat planting
is progressing slowly due to a shortage of funds for inputs. Lack
of liquidity in the banking sector is exacerbating the problem. In
addition, more farmers are shifting out of wheat and into barley as
beverages manufacturer Delta Corporation is providing inputs to
farmers to grow barley under contract for beer production.
Â¶13. Property Companies Record Increase in Rentals: Major property
developer Pearl Properties saw a rise in rental yields from 1.21
percent in 2007 to 3.11 percent in 2008 due to an increase in
rentals from US$0.28/m2 in 2007 to US$2.62 in 2008, a development
HARARE 00000471 003 OF 003
also reflected in the interim results of property developer
Mashonaland Holdings Ltd. Rentals are believed to be a tenth of
those prevailing in the region. Furthermore, they were 67 percent
in arrears in the first quarter of 2009, but fell to 40 percent by
the end of April.
Â¶14. Development Bank of Southern Africa in Loan Negotiation with
Zimbabwe: The government mouthpiece The Herald reported this week
that DBSA is conducting due diligence on two short-term loan
packages to Zimbabwe to provide US$100 million to upgrade
infrastructure in the energy, telecommunications and water supply
sectors. The report does not make clear whether the loan would be
ahead of arrears clearance.
Â¶15. Troubled Air Zimbabwe Sends Workers on Forced Leave:
Struggling with debt since off-budget support from the Reserve Bank
dried up earlier this year, Air Zimbabwe is reportedly sending out
notices to its workers to take time off at 50 percent of benefits
until recall. Workers see the move as the signal of impending
layoffs that could target as many as two thirds of the company's
Â¶16. Quote of the Week:
"They have no reason whatsoever to fear anything like that as long
as they fear and obey the laws of Zimbabwe."
– Attorney General Johannes Tomana on May 27 speaking in reference
to criticism that his office was prosecuting MDC-T MPs in an effort
to return control of Parliament to ZANU-PF.