US embassy says Gono’s bank is a key parallel market player

The United States embassy said while the government was cracking down on parallel market trading, central bank governor Gideon Gono’s Commercial Bank of Zimbabwe continued “to be one of the most brazen parallel market players”.

It said so in the wake of a speech by President Robert Mugabe who slammed foreign exchange fraud for the country’s economic downturn. 

The embassy was surprised that for a change Mugabe had not blamed the country’s economic woes on sanctions by the United States and the European Union.

Full cable:

Viewing cable 03HARARE2342, Mugabe shifts blame for recession

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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 002342

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 EFIN EINV ETRD PGOV ZI

SUBJECT: Mugabe shifts blame for recession

¶1. (SBU) Summary: In his December 2 State of the Nation

address to Parliament, President Mugabe slammed foreign

exchange fraud rather than sanctions for the country’s

economic downturn, adopting a slightly less

confrontational stance toward the U.S. End Summary.

¶2. (SBU) Over the past year, the GOZ has only rarely

spoken at length about the economy without identifying

U.S. and European sanctions as a prime cause. In

yesterday’s remarks, Mugabe also acknowledged that a

World Food Program contribution of US$212.8 million

“through the international community is sincerely

appreciated.” He asked that “partners extend their

support to our land reform programme.”

¶3. (SBU) On the other hand, Mugabe did indirectly

criticize U.S. policy in Iraq and upbraided “the Anglo-

Saxon unholy alliance against Zimbabwe” in the

Commonwealth. The President offered no coherent

proposals to turn around the economy.

Comment

——-

¶4. (SBU) The GOZ now sees forex leakages as the main

economic villain, even displacing mythical Western trade

and investment sanctions. We understand the GOZ is

trying to more firmly control remissions, foreign

currency accounts and export processing zones – but it

has not decided on a policy. Interestingly, Reserve Bank

Governor Gideon Gono’s bank – CBZ – continues to be one

of the most brazen parallel market players. Finally, we

do not know if Mugabe’s failure to mischaracterize U.S.

travel and financial restrictions in this address is a

result of Amb’s Sullivan’s interviews in the independent

press last week – and whether the GOZ will continue in

this vein.

Sullivan

(21 VIEWS)