Mutsekwa regretted signing Meikles order

Giles Mutsekwa, the co-Minister of Home Affairs who had signed an order allowing the government to take control of the Kingdom Meikles Group, said he regretted the move.

He said this after the latest twist in the Kingdom Meikles saga when the High Court blocked an extraordinary general meeting of the company’s shareholders which was aimed at approving the reversal of the merger that brought together Kingdom Financial Holdings and Meikles.

The move had been criticised by his own Movement for Democratic Change.

The court blocked the meeting at the request of the group Chief Executive Officer Nigel Chanakira who had collapsed and was in hospital in South Africa.

Chanakira and his associates were to resign as part of the de-merger.

Full cable:

Viewing cable 09HARARE771, ZIM NOTES 9-25-09

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TAGS: PGOV PREL ASEC PHUM ECON EFIN EAID ZI

SUBJECT: ZIM NOTES 9-25-09

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SUMMARY – Topics of the week

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– Political Parties Reconfigure Control of Constitutional Process

– Mujuru Faction Wins Fierce Battle for Women’s League

– Partners Being Forced onto Wildlife Conservancies

– High Court Upholds Private Diamond Claim in Chiadzwa

– MDC Security Advisor Resigns

– WOZA Demonstrates for Peace…

– … and Then Receives Human Rights Award

– Noise but No News at Mining Conference

– Court Blocks Kingdom Meikles General Meeting

– Prime Minister Sends Delegation to London

– RBZ Act on the Docket when Parliament Resumes

– Quotes of the Week

—————————–

On the Political/Social Front

—————————–

¶1. Political Parties Reconfigure Control of Constitutional

Process… The three principals to the power-sharing agreement,

President Mugabe, PM Tsvangirai, and DPM Mutambara, met last week

and agreed to form three new entities to oversee the constitutional

process – a Management Committee that appears to take the place of

the Parliamentary Select Committee (PSC) as the overall controlling

entity, a Steering Committee charged with implementation, and a

Secretariat responsible for administration. The Management

Committee consists of Constitutional Affairs Minister Eric Matinenga

(MDC-T), a negotiator from each party — Patrick Chinamasa

(ZANU-PF), Tendai Biti (MDC-T), and Welshman Ncube (MDC-M) — and

the three existing co-chairs of the PSC. Matinenga has justified

the changes on the basis that it will keep the process on track and

improve efficiency, while opponents charge that the executive has

effectively sidelined Parliament.

¶2. Mujuru Faction Wins Fierce Battle for Women’s League… Olivia

Muchena, the Joice Mujuru-backed candidate was declared the winner

of a hotly-contested election to head the ZANU-PF Women’s League.

The election developed into a struggle between Vice President Mujuru

and rival Oppah Muchinguri for control of the Women’s League leading

into December’s ZANU-PF Congress. A secret ballot had to be held

after violence erupted at the conference between Mujuru and

Muchinguri supporters on September 15. Shuvai Mahofa, the losing

candidate, now contends that vote rigging robbed her victory.

¶3. Partners Being Forced onto Wildlife Conservancies… Wildlife

ranchers in southern Zimbabwe’s Save Valley Conservancy report that

ZANU-PF insiders are attempting to create forced partnerships with

them. At a meeting last week attended by many of the ranchers and

scores of ZANU-PF officials including Minister of Higher and

Tertiary Education Stan Mudenge and Masvingo Governor Titus

Maluleke, the ranchers were told that 25-year leases had been

executed by Minister of Environment Frances Nhema which partnered

ZANU-PF officials with individual ranchers. The ranchers include a

handful of foreign investors who view this as an extension of land

Qhandful of foreign investors who view this as an extension of land

reform and a violation of bilateral investment protection treaties

between Zimbabwe and their host nations. The forced partnerships

are an obvious affront to the rule of law and will negatively affect

what is already a poor investment climate. The ranchers are also

concerned that their management of conservation areas will be

impeded and could affect wildlife, including rare rhinos.

¶4. High Court Upholds Private Diamond Claim in Chiadzwa… A High

Court judge has ruled that African Consolidated Resources (ACR) has

legal title to the area constituting the Chiadzwa diamond fields.

According to an ACR adviser, Judge Charles Hungwe refused to stay

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his judgment pending any appeal, theoretically paving the way for

ACR to immediately occupy the fields and begin operations.   Judge

Hungwe also awarded compensation for diamonds heretofore mined by

the government, stating that since the government had claimed it was

complying with the Kimberley Process, there should be a record of

diamonds extracted and sold. As a practical matter, ACR hopes that

the court’s ruling will force the government into negotiations to

establish a partnership with ACR and lead the way to a controlled

and transparent exploitation of Chiadzwa.

¶5. MDC Security Advisor Resigns… MDC security advisor Martin

Rupiya resigned this week under pressure from ZANU-PF which objected

to the fact that Rupiya had been a member of the Rhodesian Army

Selous Scouts (Special Forces). Rupiya, who subsequently became a

member of the Zimbabwean National Army, retired as a Lieutenant

Colonel in 1989. He wrote a doctoral dissertation on the Rhodesian

Army and before working for Tsvangirai was an academic affiliated

with various think tanks. Sidney Sekeremayi, Minister of State for

National Security in the President’s office, reportedly told

Tsvangirai that the National Security Council would refuse to meet

if Rupiya was in attendance.

¶6. WOZA Demonstrates for Peace… Thousands of members of the

activist group, Women of Zimbabwe Arise (WOZA), commemorated the

United Nations International Day of Peace by demonstrating and

protesting against the collapse of education, healthcare and the

rule of law. The police did not interfere with the protests in

Harare and allowed protestors to march to the UN offices where they

presented a petition. In Bulawayo, riot police broke up the

demonstration and beat up at least 25 members causing serious

injuries to the protestors.

¶7. … and Then Receives Human Rights Award… On September 15 WOZA

co-founder Magodonga Mahlangu was awarded the 2009 Robert F. Kennedy

Human Rights Award. Commenting on the award Mahlangu said, “Now I

know I am not alone, the world is watching and one day Zimbabwe

shall be a normal society again.”

————————–

Economic and Business News

————————–

¶8. Noise but No News at Mining Conference… At the GOZ-sponsored

Mining Conference on September 17 and 18, President Mugabe, PM

Tsvangirai, and a number of cabinet ministers tried to make the case

that Zimbabwe was an attractive destination for new mining

investment (see Quotes of the Week). But happy talk from the podium

was not enough to distract miners from the acute uncertainties

created by the “indigenization” law, ongoing farm invasions, and

recent developments like the Kingdom Meikles saga (see below). Nor

did the GOZ have any new policiesto promote. As for Zimbabwe’s

investment climate generally, the uncertainty that discourages major

new commitments by mining companies will not be resolved until

Qnew commitments by mining companies will not be resolved until

sustained reforms establish a degree of policy credibility.

¶9. Court Blocks Kingdom Meikles General Meeting… The latest twist

in the long-running saga of the troubled Kingdom Meikles

conglomerate is a High Court injunction that blocked a September 24

extraordinary general meeting of shareholders. The purpose of the

meeting was to approve reversal of the merger that had brought

together Kingdom Financial Holdings and the Meikles business empire

to form what was once Zimbabwe’s largest locally-owned company. The

court blocked the meeting at the request of Kingdom Meikles CEO

Nigel Chanakira, who had collapsed and been hospitalized in South

Africa. As part of the de-merger, Chanakira and his closest

associates were to resign. Meanwhile, MDC-T co-Minister of Home

Affairs Giles Mutsekwa has said he regrets signing the order that

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allowed the GOZ to seize Kingdom Meikles under the wide-ranging

authority of an anti-corruption statute.

¶10. Prime Minister Sends Delegation to London… Following hard on

the heels of two investment conferences, PM Tsvangirai dispatched a

delegation to London on September 23 to appeal to Zimbabweans based

in the UK to invest in Zimbabwe. The Minister of State in the Prime

Minister’s office, Gorden Moyo, is leading the delegation. The

director of the Zimbabwe Investment Authority and the chief

executive of the Zimbabwe Stock Exchange are expected to speak at

the Diaspora Investment Conference on September 26.

¶11. RBZ Act on the Docket when Parliament Resumes… The Reserve

Bank of Zimbabwe (RBZ) Act, a piece of legislation proposed by

Minister of Finance Tendai Biti and designed to reform and curtail

the authorities of the RBZ, has been publicly posted and is

scheduled to be debated in Parliament when the House of Assembly

comes back into session. Currently Parliament is scheduled to

resume sitting on September 29 when Mugabe opens the new session,

but precedent has been for the House to immediately adjourn for up

to 10 days.

¶12. Quotes of the Week:

“There has never been a better time than now for investors to gain

access to good mineral resources in the country.”

— Mining Minister Obert Mpofu, quoted in “The Herald” on September

¶16.

“Until we see some certainty, there won’t be any significant

investment in mining.”

— Rio Tinto executive Niels Kristensen, quoted by Reuters at the

Mining Conference on September 17.

PETTERSON

(52 VIEWS)