Masamvu says Mugabe has given Gono free rein

International Crisis Group analyst Sydney Masamvu told United States embassy officials in South Africa that when Reserve Bank of Zimbabwe governor Gideon Gono came to South Africa to discuss a bailout, Gono told him that Mugabe had given him free rein to discuss the loan.

Gono told him that he hoped that the South African government would give him $500 million to “deal with the IMF”.

According to the cable released by Wikileaks which was dispatched on 5 August 2005, the South African cabinet was “open” to providing Zimbabwe with assistance.

Government spokesman Joel Netshitenzhe said that South Africa was considering loaning between $200 – $500 million to Zimbabwe.

The money was, however, not going to be paid directly to the Zimbabwe government but was going to go through the International Monetary Fund.

Full cable:

Viewing cable 05PRETORIA3141, CABINET GIVES GREEN LIGHT TO ZIMBABWE LOAN;

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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 003141

SIPDIS

DEPT FOR AF/S B. NEULING AND K. GAITHER, EB/IFD, EB/OMA

LONDON, PARIS, BRUSSELS FOR AFRICA WATCHERS

E.O. 12958: DECL: 08/03/2015

TAGS: PREL PHUM ECON KDEM ZI SF

SUBJECT: CABINET GIVES GREEN LIGHT TO ZIMBABWE LOAN;

ZIMBABWEAN FINANCE OFFICIALS VISIT PRETORIA

REF: A. PRETORIA 2854

¶B. PRETORIA 2948

¶C. PRETORIA 2983

Classified By: Acting DCM Jeff Hartley

Reasons 1.4(b) and (d)

¶1. (U) The South African Cabinet announced August 3 that it

is “open” to providing assistance to Zimbabwe, including

“provision of a loan facility in relation to Zimbabwe’s

obligations to the International Monetary Fund” (full Cabinet

statement on Zimbabwe loan at para 5). Government spokesman

Joel Netshitenzhe said that South Africa is considering

loaning between $200 – $500 million to Zimbabwe to address

the GOZ’s obligations to the IMF.

¶2. (U) Netshitenzhe claimed that the SAG will not impose

“conditions” on the loan because Pretoria does not want to be

big brother to its neighbor, but then outlined some general

criteria for the loan that seemed to indicate that, indeed,

Pretoria would apply conditions (see para 3):

— the loan must benefit the Zimbabwean people as a whole;

— it must be within the context of Zimbabwean program of

economic reform and “political normalization;”

— the SAG expects that it will pay the funds directly to the

IMF, not the GOZ; and

— South Africa wants to ensure that the economic

difficulties that created the problems will not reoccur in

the future.

¶3. (C) Zimbabwean Finance Minister Murerwa and Reserve Bank

Governor Gono arrived in South Africa the afternoon of August

4, according to International Crisis Group analyst Sydney

Masamvu. Masamvu, who spoke with Gono August 4, said that

Gono and Murerwa planned to meet with South African Finance

Minister Manuel and Reserve Bank Governor Mboweni upon

arrival to discuss the loan conditions. Gono said they hoped

to receive $500 million from the South Africans to “deal with

the IMF problem.” Gono had free rein from Mugabe to discuss

SAG economic conditions for the loan, but Presidents Mugabe

and Mbeki would discuss the political conditions on the

sidelines of the AU summit on UN reform taking place in Addis

Ababa August 4. Finalizing the loan with South Africa was

particularly urgent for the GOZ since the Zimbabweans had not

received the support they sought from the Chinese, Gono told

Masamvu.

¶4. (C) Comment. It appears we are entering the end game on

the South African loan to Zimbabwe. While Pretoria insists

publicly it is not imposing conditions on their loan, the

reality is that they will not provide funds without at least

some guarantees on economic reform. The nature of the

political conditions are less predictable given that they are

being handled at the presidential level. End comment.

¶5. (U) Text of the August 3 South African Cabinet statement

on the loan as follows: “Cabinet was briefed on the ongoing

interaction between South Africa and Zimbabwe on the

assistance that South Africa can provide to that country. In

principle, government is open to such assistance, including

provision of a loan facility in relation to Zimbabwe’s

obligations to the International Monetary Fund. Our approach

on this matter is premised on the principle that such

assistance should be to the benefit of the Zimbabwean people

as a whole, within the context of their programme of economic

recovery and political normalization.”

FRAZER

(32 VIEWS)