Why is Biti being allowed to take the nation for a ride?


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The naivety of Finance Minister Tendai Biti never ceases to amaze me. But then perhaps my colleagues in the media and I are to blame. How in the hell could we allow him to take the nation for a ride, telling us that the national referendum and the 2013 elections will be financed from diamond revenue?

Diamond revenue to the government up to end of October was only $41 million. The referendum is expected to cost $55 million and the elections another $75 million. So how in the hell does he expect to raise $130 million before the end of March?

Biti said he expected diamond revenue to be at least $400 million in 2013. This, he said, was based on increasing production levels.

In the same budget statement he said diamond exports increased from $233.7 million up to October 2011 to $563.6 million up to October this year.

In his 2012 budget statement he said the government got $122.3 million from diamond revenue last year. So it would appear that diamond revenue has nothing to do with increased sales or production because this year he got only $41 million. He had budgeted for $600 million for this year.

All along we have been told that the government is not getting the revenue due to it from the mining companies. How is that so if, according to his budget statement, Biti knows how much the companies have made?

He even told us the formula, that the government is entitled to retain 50 percent share in every gross sale made by Mbada, Anjin and Diamond Mining Corporation, plus normal tax, PAYE, VAT and royalties. So where are things going wrong? As young Zimbabweans would say: “Minister vari kurasika papi muka one-room aka?”

The more one looks at the minister’s statement, the more one gets the impression that the minister, like everyone else in government, does not want any elections. Those in power are now so comfortable they would rather have things stay the way they are.

Of course they have to make the necessary noises because people will start telling them that their term is over.

Why do I say so? Because Biti’s figures do not add up.

He said, for example, the value of exports for Anjin, in which the government is an equal shareholder, totalled $126.9 million up to October. In his mid-term review statement, he said Anjin’s diamond exports were $120.3 million to end of June.

Anjin boasts that it is now the world’s largest diamond producer, so how was it possible for it to make only $6 million in four months. I am not saying it is not possible, maybe they did not sell anything, but Biti should have explained to the nation why?

Mbada nearly doubled its export revenue from $145.1 million to $255.3 million during the same period. Murowa more than doubled its revenue from $15.5 million to $36.4 million. Marange Resources which is wholly owned by the government also doubled its revenue from $26.6 million to $53 million.

Biti should also tell the nation whether River Ranch and DTZ-OZGEO have stopped operations. Their revenue up to June, $2.4 million and $1.2 million, respectively, was the same as at the end of October. This should raise eyebrows because the owners of River Ranch are trying to sell the mine to the government.

So, what makes Biti think the government will get more revenue from diamonds?

(2 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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