Econet was to embark on a US$93.9 million expansion to increase its capacity from 1.2 million subscribers in June to 5 million by the end of 2009.
Reports said the move was aimed at keeping foreign companies like South Africa’s MTN, which was looking for a local partner, from gaining a foothold in Zimbabwe where mobile penetration was 10 to 12 percent.
The approval of the US$93.9 million investment from the parent company was queried after the company’s extraordinary meeting with reports saying auditing firm Deloitte had inflated ballots in favour of the parent company.
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SUBJECT: ZIM NOTES 06-12-09
SUMMARY – Topics of the week
– The Herald Spins TsvangiraiQs Trip
– ZANU-PF MPs Stalling Constitutional Reform
– Human Rights Violations on the Rise
– TsvangiraiQs Amcit Niece Involved in Land Seizure
– Journalists Want Contempt of Court Charges against Minister
– AbducteesQ Case Delayed
– Human Rights Lawyer Summoned for Trial
– Furor Over Delayed, Questionable Exam Results
– Harare Ranked WorldQs Worst City
– COMESA Wraps Up
– African Development Bank President Briefs Donors
– Cost of Living Up 2 percent in May
– IMF Returning on Staff Visit
– Econet Expands
– Retailer Constrained by Lack of Working Capital
– Sales of Government Rag Up
– Quotes of the Week
On the Political/Social Front
¶1. The Herald Spins TsvangiraiQs Trip… With Prime Minister Morgan
Tsvangirai on an official visit to the U.S., Canada, and Europe the
ZANU-PF mouthpiece The Herald has been spinning his trip as a
solicitation for a lifting of sanctions and re-engagement in the
form of aid. This week, the front page has featured distorted
headlines that appear to set Tsvangirai up for failure, such as
QDutch govt turns down TsvangiraiQ and QPM, Obama clash looms.
Tsvangirai met with Secretary Clinton on June 11 and will meet with
President Obama on June 12.
¶2. ZANU-PF MPs Stalling Constitutional Reform… ZANU-PFQs
parliamentary caucus is forcing the postponement of public hearings
for the constitution-making process. They are demanding staggering
stipends of US$6,000 per month, twin-cab trucks, and travel stipends
to lead meetings to inform the public on the process. Hearings have
been delayed until at least June 24 while parliament continues
efforts to consolidate proposals to donors to help fund the
¶3. Human Rights Violations on the Rise… Zimbabwe Human Rights NGO
Forum releaseda report documenting human rights abuses between
January and April 2009. The report revealed increases in violence
and repression Q evidence of the continued polarization in Zimbabwe.
In April, the forum recorded a total of 204 violations versus 155
in March. For more details, see: www.kubatana.net/html/
¶4. TsvangiraiQs Amcit Niece Involved in Land Seizure… The press
revealed this week that American citizen and distant relative of
Prime Minister Tsvangirai, Dr. Arikana Chiyedzo Chihombori, is
attempting to take over a white-owned 70 hectare farm in central
Zimbabwe with a flawed offer letter. This is the same woman that
appeared with Tsvangirai in photographs at Jacob ZumaQs recent
presidential inauguration. Tsvangirai has affirmed they are
related, but denies having a personal relationship with her.
¶5. Journalists Want Contempt of Court Charges against Minister…
Q5. Journalists Want Contempt of Court Charges against Minister…
Four journalists have decided to sue Information Minister Webster
Shamu and his permanent secretary George Charamba for contempt of
court. Despite a High Court ruling on June 5 that declared the Media
and Information Commission defunct and no journalist should be
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required to register with it, the journalists were barred from
covering the COMESA summit last weekend on the basis that they were
not part of a list supplied by the Ministry of Information.
¶6. AbducteesQ Case Delayed… The trial of four abductees kicked
off on June 9. In an impassioned recounting of events, defense
attorney Alec Muchadehama asked High Court Judge Tendai Uchena to
refer the case to the Supreme Court in light of the numerous
violations of rights the accused experienced when they were
abducted, tortured, and turned over to police and held in prison for
several weeks without ever properly appearing before the court.
According to Article 24 of the Zimbabwean constitution, the referral
must be granted unless the judge considers the questions raised
Qmerely frivolous or vexatious.Q Justice Uchena promised to give
his decision on June 22.
¶7. Human Rights Lawyer Summoned for Trial… On June 9,
Muchadehama was served with a summons to appear for trial on June 17
on charges of obstructing justice. Muchadehama was arrested last
month for obstructing justice; a lower court later removed the case
from remand for lack of evidence. Many believe the trial on these
trumped-up charges is pure harassment of one of ZimbabweQs most
renowned lawyers by Attorney General Johannes Tomana and lead
prosecutor Florence Ziyambi.
¶8. Furor Over Delayed, Questionable Exam Results… The Zimbabwe
Secondary Schools Examination Council (ZIMSEC) finally released
national Ordinary (O) Level exam results on June 5 — four months
late. Many results have either been recorded as missing or are
wildly inconsistent with school-predicted results for students.
Minister of Education David Coltart decreed that students currently
pursuing A Level studies who failed their O level exams must leave
school and repeat their O level courses. This will negatively
affect thousands of students whose parents already paid for uniforms
and school fees after the Minister first insisted that schools take
them and open A level courses without O level results.
¶9. Harare Ranked WorldQs Worst City… The Economist Intelligence
Unit ranked Harare 140 of 140 world cities based on stability,
health care, culture and environment, education, and infrastructure.
Six of the bottom ten are in Africa; Vancouver topped the list.
Economic and Business News
¶10. COMESA Wraps Up… The 13th Common Market of Eastern and
Southern Africa (COMESA) summit wrapped up in Victoria Falls this
week. During the meeting, COMESA Chairman President Mugabe commended
the launch of the COMESA customs union. Under the union, all 19
members will impose a similar tariff on goods from outside the
region of zero to 25 percent. Sudanese President Omar al-Bashir also
attended the summit, where he was warmly welcomed by Mugabe.
Qattended the summit, where he was warmly welcomed by Mugabe.
¶11. African Development Bank President Briefs Donors… AFDB
President Donald Kaberuka visited Zimbabwe for the COMESA summit and
spent a day in Harare where he briefed donors this week on his views
of the inclusive government and investment climate. He advised that
the time had not yet come to fully re-engage. See Harare 488
¶12. Cost of Living Up 2 percent in May… The Consumer Council of
Zimbabwe reported that the monthly cost of living for a family of
six rose 2 percent in May to US$437 from US$427 in April, mainly due
to increases in rent and the cost of public utilities, health,
education and clothing. The cost of food fell by 0.5 percent in
¶13. IMF Returning on Staff Visit… Following on its March 2009
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Article IV mission and the visits of technical assistance teams in
May and June, an IMF team is scheduled to arrive on June 21 for a
nine-day staff visit.
¶14. Econet Expands… Econet has secured US$93.9 million in funding
from its parent company, under the chairmanship of Strive Masiyiwa,
to increase capacity from 1.2 million mobile phone subscribers to 5
million by year end. By expanding its subscriber base, Econet is
seeking to keep foreign competition, e.g. MTN, from gaining a
foothold in Zimbabwe where mobile penetration is currently only 10
percent-12 percent. Since the introduction of U.S. dollar tariffs,
usage measured in minutes has dropped to 10 percent of
pre-dollarization levels; previously price distortions in
Zimbabwe-dollar tariffs had made mobile calls and texting dirt
cheap. EconetQs share price has risen 135 percent since the local
stock exchange re-opened earlier this year.
¶15. Retailer Constrained y Lack of Working Capital…
Wholesaler/retailer Red Star Holdings reported an improvement in
operating capacity from below 15 percent to 33 percent at its
branches since dollarization. It said that a further increase was
contingent upon accessing credit facilities for working capital to
increase stocking levels. Our contacts in the retail sector, on the
other hand, tell us that the extremely low level of disposable
income is dampening recovery in the sector.
¶16. Sales of Government Rag Up… Sales volumes of The Herald have
climbed to 30,000 copies a day from a low of 8,000 in December 2008.
Circulation for The Herald peaked in the mid-1990s with 100,000
Quotes of the Week
¶17. QHe must tell the U.S. leader that the blockade has directly
led to the death of countless children who could not get essential
medicines from public hospitals… With standards of living plunging
horribly, malnutrition killed many in this country and most of our
people were reduced to sorry hunters and gatherers… When this
happens on a large scale, it deserves the label of genocide. In many
ways, the Western sanctions had the impact of genocide.
— From the editorial QWhat Tsvangirai Must Tell Brother ObamaQ in
the Bulawayo-based ZANU-PF mouthpiece The Chronicle on June 11,
¶18. “You can’t compare the President and Prime Minister. It is only
the President who gets coverage when he is out of the country. This
is because of protocol and resource constraints.”
— ZBC Chief Executive Officer Happison Muchetere on the Zimbabwean
government mediaQs refusal to provide PM Tsvangirai with a media
crew to cover his travel to North America and Europe.