Mzembi said he would initiate tourism revival fund

Tourism and Hospitality Minister Walter Mzembi promised to set up an emergency tourism revival fund when he assumed office in 2009.

He said this after hosting a two-day tourism conference in Harare in March, one month after the formation of the inclusive government. The conference was aimed at reviving the country’s moribund tourism industry.

Japan announced that it was removing its travel warning aimed at discouraging its citizens from travelling to the Victoria Falls, shortly after the conference.

Full cable:

Viewing cable 09HARARE268, ZIM NOTES 03-27-2009

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VZCZCXRO3681

RR RUEHBZ RUEHDU RUEHJO RUEHMR RUEHRN

DE RUEHSB #0268/01 0891127

ZNR UUUUU ZZH

R 301127Z MAR 09

FM AMEMBASSY HARARE

TO RUEHC/SECSTATE WASHDC 4298

RUCNSAD/SOUTHERN AF DEVELOPMENT COMMUNITY COLLECTIVE

RUEHUJA/AMEMBASSY ABUJA 2258

RUEHAR/AMEMBASSY ACCRA 2737

RUEHDS/AMEMBASSY ADDIS ABABA 2859

RUEHRL/AMEMBASSY BERLIN 1305

RUEHBY/AMEMBASSY CANBERRA 2124

RUEHDK/AMEMBASSY DAKAR 2480

RUEHKM/AMEMBASSY KAMPALA 2907

RUEHNR/AMEMBASSY NAIROBI 5348

RHEHAAA/NSC WASHDC

RHMFISS/EUCOM POLAD VAIHINGEN GE

RUEHGV/USMISSION GENEVA 2026

RUZEJAA/JAC MOLESWORTH RAF MOLESWORTH UK

RHEFDIA/DIA WASHDC

UNCLAS SECTION 01 OF 03 HARARE 000268

AF/S FOR B. WALCH

ADDIS ABABA FOR USAU

ADDIS ABABA FOR ACSS

NSC FOR SENIOR AFRICA DIRECTOR

STATE PASS TO USAID FOR L.DOBBINS AND J. HARMON

COMMERCE FOR ROBERT TELCHIN

SIPDIS

E.O.12958: N/A

TAGS: PGOV PREL ASEC PHUM ECON ZI

SUBJECT: ZIM NOTES 03-27-2009

———–

¶1. SUMMARY

———–

Topics of the week:

– Parliament Getting its House in Order…

– Zimbabwean Teachers Consider Striking…

– Government Sponsors Stakeholders Meeting…

– Cholera Continues to Decline…

– Zimbabwe Hosts Tourism Conference…

– Court Update…

– Scandinavians Send Delegates to Zimbabwe…

– UZ Postponed Again!

– Banks Struggle to Pay US$ Allowances…

– Kimberley Process Chair Gives Zimbabwe Kid-Glove Treatment…

– IMF’s Recommendations…

– Biti’s Revised Cash Budget…

– Fungibility of Shares Restored…

– Former Trade Minister Appointed Vice President of AfDB…

—————————–

On the Political/Social Front

——————————

¶2. Parliament Getting its House in Order… Parliament has

recently constituted the important Standing Rules and Orders

Committee and is in the process of establishing Portfolio

Committees, setting up a Standing Committee on the Constitution, and

making appointments to the Media, Anti-Corruption and Electoral

Commissions. These new bodies will help enable Parliament to

promote its legislative agenda and push reform, though any new

legislation will likely originate from the executive branch.

Parliament also resumed “question time,” an important mechanism that

allows MPs to ask policy questions of government ministers. See

Harare 264.

¶3. Zimbabwean Teachers Consider Striking… Faced with

government’s continued inability to pay teachers a living wage in

foreign currency, Zimbabwe’s teachers are growing restless and may

resort to a work stoppage if the situation does not improve in the

next couple of months. Currently teachers are only receiving the

US$100 allowance paid to all civil servants. Many teachers are

frustrated because they returned to their posts after having been

promised more substantial forex salaries by Prime Minister

Tsvangirai, but recent statements by Education Minister David

Coltart have made clear government does not have the funds

available. See Harare 246.

¶4. Government Sponsors Stakeholders Meeting… The GOZ sponsored a

stakeholders meeting with government officials, donors, and civil

society which was promoted as an opportunity to engage in dialogue.

Prime Minister Morgan Tsvangirai keynoted the day-long meeting. A

ministerial retreat is to take place next weekend.

¶5. Cholera Continues to Decline… The World Health Organization

reports that, for the week ending March 14, there was a 45 percent

decrease in suspected new cases of cholera and a 39 percent decrease

in deaths compared to the prior week, despite a reemergence of cases

in Harare and Chitungwiza. UNICEF reports that water supply

chemicals in main urban areas are now secure. On March 20, a water

and sanitation-focused World Bank team finalized a one-week

assessment mission to allocate emergency funds, and will likely

initiate a US$10 million infrastructure repair project in Harare,

with another US$3 million to be utilized as a pilot in suburban or

Qwith another US$3 million to be utilized as a pilot in suburban or

rural areas. As of March 24, the cholera outbreak has claimed 4,077

lives and affected more than 92,000 people.

¶6. Zimbabwe Hosts Tourism Conference… The Zimbabwean government

HARARE 00000268 002 OF 003

hosted a two-day tourism conference in Harare on March 25 and 26 in

an effort to revive the country’s moribund tourism industry.

Concurrently, Minister of Tourism and Hospitality, Walter Mzembi,

announced that the GOZ would initiate an emergency tourism revival

fund. On the heels of the well-attended conference, Japan announced

that it would remove its travel advisory discouraging Japanese

travel to Victoria Falls.

¶7. Court Update… The case of three elderly white Zimbabweans —

arrested in early January on charges of training MDC activists in

terrorism and banditry — was removed from remand this week by

magistrate Gloria Takundwa. In addition, strict bail conditions for

four of the seven accused of bombing police stations were relaxed;

now they must report to police stations once per week rather than

twice daily. The trial of eight Women of Zimbabwe Arise women and

two lawyers, arrested in connection with a Valentine’s Day march,

failed to start on March 25. For the second time, police witnesses

failed to appear for the trial. The magistrate delayed the trial

again to April 29.

¶8. Scandinavians Send Delegates to Zimbabwe… Norway’s

Environment and International Development Minister, Erik Solheim,

and Denmark’s Minister for Development Cooperation, Ula Toernas,

made separate trips to Zimbabwe to meet with President Robert Mugabe

and other senior officials during the past two weeks. The purpose

of their visits was to evaluate conditions in Zimbabwe as a

potential pre-curser to renewing ties and channelling assistance.

Zimbabwean officials also pressed Denmark to lobby other EU members

to lift sanctions. The state-controlled media gave significant

coverage to the visits and portrayed them positively, though both

representatives were critical of the continued detention of

political prisoners and rash of recent farm invasions.

¶9. UZ Postponed Again! The University of Zimbabwe, scheduled to

start its second semester of the 2008-09 academic year three months

late next Monday, has postponed opening once again, this time to a

date “to be advised in due course.” All faculty and staff at the

university are still only being paid monthly US$100 allowances, so

faculty and staff strikes would have been imminent had the

university tried to open. The only exceptions are the Medical

School and the few, small graduate programs.

———————————–

On the Economic and Business Front

———————————-

¶10. Banks Struggle to Pay US$ Allowances… The GOZ again this

month topped up the worthless Zimbabwe dollar salaries of its

employees with a US$100 allowance. Problems and lines arose at

primarily non-bank financial institutions, where most civil servants

bank, as these institutions struggled to pay out the allowance.

With the official Poverty Datum Line for a family of five set at a

very generous US$552 per month, even assuming cash distribution

problems are solved, the meager allowance may lead to frustration

Qproblems are solved, the meager allowance may lead to frustration

and impatience. See Harare 266.

¶11. Kimberley Process Chair Gives Zimbabwe Kid-Glove Treatment…

KP Chair Bernard Esau of Namibia got a white-washed account from the

GOZ of violence in the disputed Chiadzwa diamond field during his

team’s visit to Zimbabwe last week. He made conciliatory remarks

about the need for SADC to support Zimbabwe in his parting address

to a select group of stakeholders. See Harare 263.

¶12. IMF’s Recommendations… In a statement at the conclusion of

the IMF’s Article IV mission, the mission chief welcomed the new

government’s commitment to ending off-budget spending and matching

expenditure to revenue in 2009. He recommended greater

accountability and transparency of the Reserve Bank and restricting

HARARE 00000268 003 OF 003

it to core central bank activities. The mission chief also

recommended strengthening the investment climate, ensuring property

rights protection, and maintaining wages at competitive levels to

increase investment. See http://www.imf.org/external

/np/sec/pr/2009/pr0993.htm.

¶13. Biti’s Revised Cash Budget… Despite the improvement in

economic policy underlying Finance Minister Biti’s revised budget,

members of the recent IMF mission suggested that the government’s

revenue projection of US$1 billion was high. We expect the IMF

staff report to project a US$200 million deficit. See Harare 260.

¶14. Fungibility of Shares Restored… Following several policy

flip flops, the Reserve Bank of Zimbabwe (RBZ) restored offshore

trading of dually-listed shares on March 17, 2009. For stock

listings with full fungibility, investors can now buy shares from

one stock exchange and transfer them to another exchange where the

company is also listed. Partially fungible shares will continue to

trade in one direction –from overseas to Zimbabwe– although the

RBZ may consider full fungibility for these shares in order to raise

capital for expansion projects.

¶15. Former Trade Minister Appointed Vice President of AfDB… The

Zimbabwe Independent reported today that former Minister of Industry

and International Trade Nkosana Moyo has been appointed Vice

President of the African Development Bank (AfDB). Meanwhile, an

AfDB private sector specialist was in Harare this week looking at

the possibility of channeling credit to the private sector, and a

further AfDB team is on an extended three-month mission in Zimbabwe.

—————–

Quote of the Week

—————–

¶16. “Conditions, they’re always setting conditions! It’s their way

of making us slaves. If Zimbabwe is to accept aid, it must be

offered on a friendly basis. We will not bow to the donors.” —

President Mugabe speaking at a joint press conference with the

Norwegian development minister in Harare on March 25.

MCGEE

(19 VIEWS)