Mugabe joined Jonathan Moyo and Made in blame game

President Robert Mugabe joined Information Minister Jonathan Moyo and Agriculture Minister Joseph Made in blaming parallel market traders for creating the forex shortage in the country.

The “black market . is run and supported by a mercenary breed of wily and selfish merchants, a breed that neither sows nor sweats,” Mugabe said.

He also blamed United States and European Union sanctions on the country as another main reason for the economic downturn.

Full cable:

Viewing cable 03HARARE2184, Mugabe to Restructure Economic Team

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

UNCLAS HARARE 002184

SIPDIS

SENSITIVE

STATE FOR AF/S

NSC FOR SENIOR AFRICA DIRECTOR JFRAZER

USDOC FOR 2037 DIEMOND

TREASURY FOR OREN WYCHE-SHAW

PASS USTR FLORIZELLE LISER

STATE PASS USAID FOR MARJORIE COPSON

¶E. O. 12958: N/A

TAGS: ECON EINV PGOV ZI

SUBJECT: Mugabe to Restructure Economic Team

Refs: a) Harare 2140   b) Harare 2149

¶1. (SBU) Summary: In a clear indication that hardliners

are winning out over Finance Ministry and Reserve Bank

(RBZ) moderates (refs a/b), President Mugabe has

announced his intent to shake up his economic team. It

also suggests the November 20 budget speech will offer

Zimbabwe’s beleaguered private sector scant relief. End

summary.

¶2. (U) Mugabe’s remarks closely paralleled recent

comments by cabinet hardliners Jonathan Moyo and Joseph

Made:

– Forex Shortage. Mugabe continued to blame parallel

market traders for creating a forex shortage. In some of

his strongest language to date, he said the “black market

. . . is run and supported by a mercenary breed of wily

and selfish merchants, a breed that neither sows nor

sweats.”

– Targeted U.S. and EU sanctions. Mugabe referred to

“the vicious campaign led by Britain and her allies” as

another main reason for the economic downturn.

– Land Reform. Mugabe hinted that Zimbabwe’s chaotic

land redistribution was not over: “Fast track was just a

phase . . . within a broader and ongoing land reform

program. Its conclusion is therefore not the end of land

reform.” He lashed out again at white farmers who “hope

that Zimbabwe will be their colony again. It will not.

Never, ever!”

Comment

——-

¶3. (SBU) The GOZ’s departure from reality is becoming

more pronounced. It routinely mischaracterizes U.S. and

EU targeted sanctions as broad trade restrictions,

fabricates burgeoning numbers of foreign visitors to

Zimbabwe and will not acknowledge that the official

exchange rate of Z$824:US$1 is merely a GOZ subsidy for

certain services. (Only on the parallel market is

currency freely exchanged.)

¶4. (SBU) The private sector had been hoping against hope

that a positive sign would emerge from the November 20

budget speech: devaluation, formal end to land reform,

return of exchange bureaux, higher revenue retention for

exporters (currently 50 percent).   Mugabe’s remarks not

only stymie these hopes, they weaken the impact of recent

GOZ reforms. By lashing out so fervently against the

black market, for example, Mugabe ensures that oil

companies will think twice about selling fuel at market

rates (counteracting Energy Ministry assurances that they

may do so).

¶5. (SBU) It is also probable that Mugabe will replace

several RBZ and Finance moderates with hardliners.

Finance Minister Herbert Murerwa appears to be through.

Hardline Justice Minister Patrick Chinamasa has already

been standing in for him, a snub to moderate Finance

Deputy Chris Kuruneri, who criticized remarks by

Agriculture Minister Made last week (ref a).

Sullivan

(40 VIEWS)