Top stories October 11-15


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Dongo accuses Mugabe of exploiting war veterans to prop Grace – Former legislator and opposition leader Margaret Dongo has accused President Robert Mugabe of exploiting war veterans to prop his wife Grace who was catapulted from nowhere to lead the Zimbabwe African National Union-Patriotic Front Women’s League at the party congress in December. But some reports say Grace is going for the big one, the presidency of the party.  “I am failing to understand how the First Lady qualified to campaign for such a powerful position because as far as I know in ZANU-PF one has to come from the structures, beginning from the grassroots up until to the central committee and then the politburo, something which did not happen to her… War veterans who fought for the liberation of the country, whose fruits Mugabe is enjoying today, if they want to go into the central committee they are told to follow the party procedures of joining the structures from the grassroots,” Dongo told New Zimbabwe.Com. “There are a lot of women who have led the ZANU-PF Women’s League but did not get that kind of publicity, why? Just because they did not have the political power Mugabe has… There are a lot of senior members in the party who participated in the liberation struggle but are being sidelined. We have a lot of people who were injured during the liberation struggle who deserve to occupy those positions but because they do not have anyone to speak for them they will remain in the wilderness.”  Grace Mugabe is currently on a nation-wide tour and is receiving a publicity blitz even from the private media. Dongo, a war veteran, was sponsored by liberation fighters to contest the Harare South seat in 1990 but lost in the 1995 elections. She, however, contested the results and won the seat as an independent. She formed the Zimbabwe Union of Democrats in 1998 but it never made any impact. The entry of the Movement for Democratic Change into politics in 1999 marked her political demise.

ZCTU says over 4 000 jobs were lost between January and September

A total of 4 172 people lost jobs between January and September, confirming a worsening economic crisis that has seen several businesses shutting down, the Zimbabwe Congress of Trade Unions (ZCTU) has said. Last year, the country recorded 9 617 job losses and 75 company closures, according to figures availed by the ZCTU. ZCTU secretary general Japhet Moyo said that the figures were conservative as some companies did not process their lay-offs through the Retrenchment Board, which provides the data. “Figures from the Retrenchment Board reveal that 4 172 workers have lost their jobs as at September 2014. The numbers could be more as some unions don’t give us that information as frequently as we would want,” said Moyo. He added that the frenzy of job cuts recorded at the start of the year had slowed down as many firms could not cut any further. Moyo said most of the job cuts had been recorded in the security, engineering, clothing and textile, timber and allied industries, mining, packaging, motor industry and printing sectors. Most firms cited the ongoing liquidity crunch as the main reason for laying off staff, he added. Analysts say Zimbabwe’s worsening unemployment is due to lack of fresh investment coming into the economy to upgrade plants that can no longer produce competitively in the face of increased imports, mainly from South Africa and China. The country’s official unemployment figures of around 11 percent, which the authorities say take into account a burgeoning informal economy, are widely scoffed at by independent economists who put the figure above 80 percent. According to central bank statistics, Zimbabwe drew in $67 million in foreign direct investment in the first half of 2014, down from $165 million over the same period of 2013, a far cry from what its regional peers are attracting.  Critics blame President Robert Mugabe’s policies, such as his seizure of white-owned farms to resettle blacks, as well as his current push to localize control of all major companies, especially mines, for Zimbabwe’s poor showing in the FDI stakes. The central bank says, on a cumulative basis between 1980 and 2013, Zimbabwe has received $1.7 billion in FDI flows, compared with $7.7 billion and $15.8 billion for Zambia and Mozambique, respectively.

 

Grace says Mugabe can appoint anyone as Vice President not necessarily a VP of ZANU-PF

First Lady Grace Mugabe has brought in a new twist to the country’s vice-presidency and the succession battle. The doors are wide open.  One does not necessarily have to be one of the two second secretaries or vice-presidents of the Zimbabwe African National Union-Patriotic Front to be the country’s vice-president. Grace’s revelation, if true means, means that the race for vice-presidency is wide open. President Robert Mugabe can appoint anyone. Up to now the battle has been to rise to the vice-presidency of the party as this has all along resulted in an automatic elevation to State vice-presidency. But Grace’s statement, made at a rally in Gwanda, could also mean that even Vice-President Joice Mujuru, one of the main contenders to succeed  Mugabe and  currently the only State vice-president who constitutionally will take over from Mugabe should anything happen , might not be reappointed State Vice-president. There has been wide speculation that Grace was brought into politics to thwart the ambitions of Mujuru to succeed Mugabe.  Mujuru reportedly leads one of the factions that pits her against a faction allegedly led by Justice Minister Emmerson Mnangagwa.  Mujuru has denied that she leads a faction claiming she belongs to Mugabe’s faction. “This issue of factionalism is corruption. If you buy someone to support you, that’s corruption. What’s said in our Constitution is that the President makes the appointments. The President is the one who appoints these people. If you go around saying you are the one, and you are unstoppable, you are working against yourself. You are jeopardising your chances. Maybe you had chances because you are an intelligent person, but you are jeopardising your chances by your actions,” Grace said.

 

Inflation slides to 0.09 percent

Zimbabwe’s annual inflation rate shed 0.06 percentage points to 0.09 percent in September compared to 0.15  percent recorded in August, as deflationary pressures persist, the national statistics agency said today. Month-on-month inflation rate stood at -0.01 percent after gaining  0.30 percentage points on the August rate of  minus 0.31 percent.

 

Foreign-owned banks comply with indigenisation law

All but one foreign-owned banking institutions operating in the country have complied with country’s local ownership requirements, a cabinet minister said today. Banks, which include Standard Chartered, Barclays, Stanbic and Afrasia, had been under pressure to comply with Zimbabwe’s indigenisation law which demand that local blacks own a minimum of 51 percent in companies valued over $500 000. Foreign-owned banks had been a subject of debate, with fears of capital flight should they be forced to comply, but indigenisation minister Francis Nhema said government had approved empowerment plans submitted by most of the financial institutions. “Most of the banks have complied and we are happy, it is now more on us to process the papers,” Nhema told journalists, declining to give details. “As of now, we have one which we are discussing with, the others have put down their plans and we are happy. The one which is outstanding is not because they are resisting but we are still discussing the plans with them.” Nhema said government was appreciative of the current liquidity constraints that had seen some local banks approaching foreigners for funding, which diluted the shareholding structures. “We do understand that there are liquidity problems and therefore we will give them more time to comply,” he said. “Even if you ask for more funding you have to state to us and we approve when you will comply. You might temporarily give foreigners an edge, probably 40-60, which has happened with one bank, but you give us the timeframe within which you will have complied.” Nhema said government had not faced any resistance from companies in the rest of the economy on compliance. “…what has been happening is that companies have been coming through seeking advice on how they can comply. Initially they were hesitant,” he said. The indigenisation law is seen as inhibiting Zimbabwe’s ability to attract new investment, after it registered a meagre $67 million in foreign direct investment in the first half of 2014, down from $165 million over the same period last year. On community share ownership trusts (CSOTs), Nhema said government was now aiming at making the trusts commercially viable after noting that they had been focusing on social projects. A total of 16 CSOTs out of the registered 72 are operational. “We also have observed that in most cases they (trusts) lack the business skills that are required for them to run as profit organisations as opposed to social institutions,” he said. “We are emphasising that the projects they do must be income generating so that the trust is sustainable.” He said projects funded through the trusts must now be of a national rather than local area focus to ensure that the whole country benefited from the trusts. Nhema said government was also changing the requirements for beneficiaries under the Youth Development Fund (YDF) to curb growing cases of loan defaults. Financial institutions such as Central African Building Society (Cabs) and CBZ, which are managing the funds, have complained of high cases of non-performing loans, forcing a rethink of the programme. Nhema said youth were now required to provide guarantors for their projects in cases where they did not have collateral. “Some form of guarantee must be provided. Even if they don’t have collateral, they must have a guarantor,” he said.

 

Tourism bookings cancelled because of Ebola fears

Tourist arrivals this year are seen taking a knock as a result of restricted international travel due to the Ebola virus outbreak in West Africa, the Zimbabwe Tourism Authority (ZTA) said today. The ZTA last month said Zimbabwe had lost business worth $6 million since the outbreak of the highly contagious virus in March which has resulted in limited international travel and 30 foreign buyers had withdrawn their participation in this year’s Sanganai/Hlanganai World Tourism Expo which starts today, ZTA chief executive Karikoga Kaseke told a media conference.  He said the outbreak had negatively impacted on the local tourism industry and the number of cancelled visits was projected to grow.  “We have had cancellations (for paid for bookings). People had paid for holidays in Zimbabwe and are demanding their monies back,” said Kaseke. “We have not done a total impact assessment on this Ebola issue but the amount of business lost is most likely to continue growing and surpass the $6 million as we approach the holiday season.” No cases of the virus have been recorded in Zimbabwe.

(29 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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