Gono stuns IMF and US government


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Central bank governor Gideon Gono stunned the International Monetary Fund and the United States government when he paid US$120 million on 29 August 2005 towards the country’s IMF debt, leaving both wondering where he had got the money.

The United States thought that the South African government which had been approached for a US$1 billion loan had bailed out Zimbabwe but Pretoria said it was not even aware of the payment.

Gono had the last laugh.

He said he had starved the nation to raise the money which he had only started accumulating since 30 June.

The IMF was not aware of the reserves.

South Africa was not aware of the payment.

Only President Robert Mugabe and two central bank advisors knew about the plan.

Even Finance Minister Herbert Murerwa was not aware of the plan until 29 August when Gono made the payment.

 

Full cable:

 

Viewing cable 05PRETORIA3543, SOUTH AFRICA DENIES PAYING ZIMBABWE’S IMF BILL;

If you are new to these pages, please read an introduction on the structure of a cable as well as how to discuss them with others. See also the FAQs

Reference ID

Created

Released

Classification

Origin

05PRETORIA3543

2005-08-31 16:29

2011-08-30 01:44

CONFIDENTIAL

Embassy Pretoria

This record is a partial extract of the original cable. The full text of the original cable is not available.

C O N F I D E N T I A L PRETORIA 003543

 

SIPDIS

 

DEPT FOR AF/S B. NEULING AND M. TABLER-STONE, EB/IFD, EB/OMA

LONDON, PARIS, BRUSSELS FOR AFRICA WATCHERS

 

E.O. 12958: DECL: 08/30/2015

TAGS: PREL PHUM ECON KDEM ZI SF

SUBJECT: SOUTH AFRICA DENIES PAYING ZIMBABWE’S IMF BILL;

GONO SAYS GOZ PAID DEBT ITSELF

 

REF: A. 8/30 NEULING-RIPLEY EMAILS

 

B. PRETORIA 3141 AND PREVIOUS

 

Classified By: Charge d’Affaires, a.i. Don Teitelbaum

Reasons 1.4(b) and (d)

 

1. (C) Per reftel A, the IMF reported to the USG August 29

that Zimbabwe paid $120 million toward its IMF debt. South

African Department of the Treasury officials that Post

contacted August 30-31 were unaware of any South Africa

payments on behalf of Zimbabwe to the IMF. Zimbabwean

Central Bank Governor Gideon Gono told Strive Masiyiwa (see

bio-note below) August 31 that the Government of Zimbabwe

(GOZ) paid the loan itself without outside assistance. In an

August 31 telcon with PolOff, Masiyiwa said that Gono told

him he had “starved” the nation of fuel and other key items

to accumulate the hard currency. IMF staff were not aware of

the GOZ reserves because they were accumulated only since

June 30. Gono said that South Africa was not aware of the

payment; only President Mugabe, Gono, and two Central Bank

advisors knew of the plan. Even Finance Minister Murerwa was

not aware until late August 29. Gono told Masiyiwa that the

GOZ made the payment as a “matter of national sovereignty.”

Masiyiwa said that Gono was excited and very upbeat about the

news.

 

2. (C) Comment: The payment of a chunk of Zimbabwe’s IMF

debt seems to take the wind out of the sails of the South

African-Zimbabwe loan negotiations (reftel B). While the GOZ

still owes some $170 million to the IMF and desperately needs

food, agricultural inputs, fuel, and electricity, the IMF

payment (and resulting diminishing of expulsion threat)

removes a key SAG leverage point. South Africa may still

make a loan/grant, but may have to abandon its political

conditions. Gono’s story (through Masiyiwa) that the GOZ

paid its own IMF debt is possible, but it also is possible

that other, unspecified parties made contributions that both

they and Zimbabwe want to keep secret. End Comment.

 

3. (C) Bio-Note: Strive Masiyiwa is a Zimbabwean businessman

and Chief Executive Officer of Econet Wireless, an

international telecommunications company. He lives in South

Africa in political exile. While a fierce opponent of the

Mugabe regime and MDC supporter, Masiyiwa remains in contact

with some GOZ officials, including Gono, who was once a

member of his corporate board. End Bio-Note.

TEITELBAUM

(15 VIEWS)

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Charles Rukuni
The Insider is a political and business bulletin about Zimbabwe, edited by Charles Rukuni. Founded in 1990, it was a printed 12-page subscription only newsletter until 2003 when Zimbabwe's hyper-inflation made it impossible to continue printing.

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