Cable reveals Biti's hand in Zimbabwe sanctions

By: Samantha Chidzero

Posted: Sunday, February 6, 2011 8:47 am

THE Movement for Democratic Change party has been working with the European Union in the maintenance and partial lifting of sanctions against Zimbabwe, despite claims by that party that they have no control of decisions made in Brussels over Zimbabwe.

A confidential cable released on Friday by whistle-blowing website WikiLeaks shows that MDC-T secretary general Tendai Biti has been making recommendations to the EU over who should, and who should not, remain on the sanctions list.

Despite media remarks by Biti that sanctions were hurting the economy and should be lifted, he has been advocating their "partial lifting".

The confidential memo released on Friday entitled "SOMALIA/ZIMBABWE/SOUTH AFRICA: UK MINISTERS ON RESOURCES, SANCTIONS, AND RELATIONS" quotes Biti suggesting the "partial lifting" of sanctions against eight parastatals and at least one individual and informing the EU of dead persons on the sanctions list.
The cable, which originated from the US embassy in London, in January 2010 says the EU "decided to support ... a minimal lifting of sanctions on Zimbabwe by delisting the eight parastatals requested by Finance Minister Tendai Biti."

The memo also revealed that Biti was instrumental in having Zapu leader Dumiso Dabengwa removed from the list: "UK ministers agreed to support within the EU the de-listing of (1) the eight parastatals requested by Zimbabwean Foreign Minister Tendai Biti, (2) any persons on the list who have died, (3) a Lebanese national (NFI), and (4) former ZANU-PF supporter Dr. Dumiso Dabengwa."

The confidential diplomatic dispatch put paid to claims that MDC-T has no control over the sanctions policy in Brussels.
It also shows the duplicity of the MDC-T within the inclusive Government.

Ironically, Biti's MDC-T party has been involved in the EU-Zimbabwe political dialogue team which seeks to normalise relations (including lifting of Art. 96 of the Cotonou Agreement and sanctions) alongside progress in the implementation of the Global Political Agreement.

A separate confidential cable released last week revealed that MDC-T leader Morgan Tsvangirai, who is also the prime minister in the inclusive Government, used a state visit to the US to plot regime change in Zimbabwe.

Last year the MDC-T said it has no control in the matter of sanctions after President Mugabe and his Zanu-PF party charged that the former opposition party had a hand in setting the sanctions and therefore should be held responsible for removing them.

Zanu-PF has maintained that it will not give in to anymore MDC-T demands as it was not playing its role in the lifting of sanctions.

Subject: Poverty Datum Line update

Subject: Poverty Datum Line update


Figures for December have now been received from the Central Statistical Office and they show that the cost of food went down slightly in December and the average is almost the same as it was in February 2010. For all the items in the index, the December figure was also down on November's and also not far off the figure for February, but all the prices had increased during the year and they peaked out in May for food and in June for the full range of goods in the index.

No details of the items included in the index are provided in these tables, but the differences in costs between different parts of the country are shown. Compared to $466,85, the average cost for the basic requirements for a family of five for the whole country, the figure for Harare is $455,41, for Bulawayo $476,15, for Masvingo $473,57 and for Manicaland $452,29. The highest figure for the country is Matabeleland North at $507,53 and the lowest is Mashonaland Central $430,48.

The fact that a very high percentage of the working population is not earning as much as $400 a month suggests that either most households have more than one source of income, or that the definition of the word “poverty” should be re-examined. In many other countries, the monthly wages are known to be very much lower than the rates of pay in Zimbabwe and they would probably be extremely envious of their Zimbabwean counterparts.

Unfortunately for Zimbabweans, the goods that our retailers can import from those countries are making many of the jobs in this country extremely insecure and employment growth appears not to be happening in any important business sector.

The trades unions are using these PDL figures to strengthen their arguments for pay increases that will further reduce Zimbabwean manufacturers’ hopes of being able to compete, so all the signs suggest that the whole issue should become the subject of much more intense debate. But before that debate starts, workers should be advised that if their trades unions get their way, it will be at the expense of many of the jobs that exist today and many more jobs that will never come into existence.

Kindest regards,

John

China to pump in US$10bn into Zimbabwe's economy

By: MW-Reuters-TZG
Posted: Wednesday, February 2, 2011 12:54 am

CHINA Development Bank is poised to fund up to US$10 billion in Chinese investment in the Zimbabwean mining and agriculture sectors ‒ a significant boost for a country struggling to attract foreign investors.

President Robert Mugabe adopted a 'Look East Policy' after the west imposed illegal sanctions on Zimbabwe.
He has increasingly looked for help from China, which in turn is in search of natural resources for its rapidly expanding economy.
“We have met with officials from China Development Bank and they have said they are willing to invest up to US$10 billion in Zimbabwe," economic planning and investment promotion minister Tapiwa Mashakada told Reuters on the sidelines of a business conferencein Harare, Zimbabwe.

Such an investment would dwarf Zimbabwe's gross domestic product (GDP), which is expected to be about US$6 billion this year.
No immediate comment was available from the Chinese embassy in Harare.
Mashakada told the conference he saw gold production hitting 13t in 2011, up from 8.3t in 2010.

He also expected Zimbabwe to produce about 1.5Mt of maize in 2011, up from 1.3 million a year before. Zimbabwe also has the world's second largest platinum reserves after South Africa.

“China is looking into mining development, as well as agriculture, infrastructure development and information communication technology,” said Mashakada, a minister from Prime Minister Morgan Tsvangirai's Movement for Democratic Change party. He would not say if the investment would come this year.
China's investment in Zimbabwe has been growing steadily over the last decade.
“The Chinese are now moving towards strict due diligence, accountability and transparency.
"At the end of the day this really depends on us, and how we position ourselves as a destination for investment,” said Mashakada. “China is coming in a very big way.”

From John Robertson

We have now had two full years since the Consumer Price Index was rebased on the US dollar prices recorded in December 2008 and the averages for that month were set at 100. Such were the distortions at the time that, of the twelve groups of goods and services identified, the averages for only four of them are now recording figures of more than 100. These are liquor and cigarettes at 102,26, the rent, rates, power and water category at 116,12, transport at 105,76 and education at 110,00.


As the services can be described as almost entirely of Zimbabwe origin, their costs seem less likely to be held down by their suppliers having to compete with imports, so from medical services to hairdressers and from motor mechanics to the rates charged by local authorities, the indices have all trended well above the figures for most imported goods, as well as for locally produced goods that face competition from imports.

Some of the lowest price indices are for clothing and footwear, household textiles and the types of goods that competing supermarkets are obliged to offer at attractive prices, whether imported or sourced from local manufacturers. Other prices have remained almost unchanged and among these, fuels and lubricants are a good example. Although the index for these has reached 153,9, this figure has varied very little for the past 17 months. Fuel price increases that occurred in December appear to have happened too late to be included in the December index.

The month-on-month increases show that 28 of the 67 items surveyed for the index went down in price in December, but the tightness of the market conditions is illustrated by the fact that the prices of 30 of the 67 items were lower than in December 2009. While the managements of some factories are known to have invested in plant and equipment to achieve improved production volumes and standards, the most obvious investments have been in retail premises that might have extended the areas and stocks of goods well beyond the spending power of Zimbabweans, specially as about 70% of the working-age population is sill unable to find steady employment.

In my comments after the Budget presentation in November, I pointed out that funds for the claimed doubling of public sector salaries had not been provided for in the figures. The January salaries paid to the military and civil servants reflect my concern, and we now hear of plans for strikes and other protests. As about one third of Zimbabwe’s working population draws a government salary, this disappointment is affecting the business sector too.

Reports are also being circulated about food shortages and the growing need for assistance in the rural areas ahead of the maize harvests. Hopefully the news will start improving when the crops start coming in.

Kindest regards,

John

German investor in Zimbabwe vows to press case against land seizure

Harare - A German investor who has taken the Zimbabwe government to the Paris-based International Centre for Settlement of Investment Disputes (ICSID) after Harare seized his properties under its reform programme is vowing to stay put until the case is settled.


In an interview at one of his properties north of Harare, Heinrich von Pezold, 58, said he went to the ICSID after Harare refused to deal with his complaints.

He said that his three investments are covered by a bilateral investment protection treaty that Berlin and Harare signed in 1995.

'A lot of damage has been caused on my assets by settlers on my properties,' he said. 'Over the years I have tried to engage the government of Zimbabwe.'

Von Pezold called Zimbabwe 'a place to do productive investment, which is why we continue to invest here.'

He hopes for a chance to meet the government and find a solution under the bilateral investment protection accord.

'But for now we want the arbitration centre to settle this matter,' von Pezold said, declining to disclose how much compensation he was claiming.

Zimbabwe Attorney General Johannes Tomana confirmed that Harare was being summoned by the ICSID.

'We have received the papers and we are looking at them,' he said.

Von Pezold, one of the few white commercial farmers left in Zimbabwe, said he was confident that one day Zimbabwe will honour its international obligations. He vowed that he will not leave his investments until justice has prevailed.

'We have no dispute with Zimbabwe. We have dispute with some policies. Many countries go through times of difficulty,' he said, and added he believed Zimbabwe's current problems will be resolved.

But it was important for investors stand up for their rights, von Pezold said.

'Only if people have faith in the future will they risk their savings to build a future Zimbabwe,' he said, while gazing out at his tobacco fields.

Von Pezold has three estates in Zimbabwe, which he said he bought in 1988 from a commercial farmer.

'I have invested millions of dollars in Zimbabwe and just can't let that investment go,' he said.

Von Pezold last year was the focus of controversy between Berlin and Harare, after he refused to vacate his seized coffee plantation which the government wanted to confiscate for resettlement.

The German embassy in Zimbabwe protested to Zimbabwe's Foreign Ministry to help cool the dispute down.

Zimbabwe Finance Minister Says Government Unable to Lift State Salaries

Despite talk of a strike, sources say civil servants are not unified on how to proceed, some arguing for a strike or other industrial action, others proposing to seek an audience with President Robert Mugabe

Studio 7 Reporters
Harare & Washington 21 January 2011

Zimbabwean Finance Minister Tendai Biti has told negotiators for state employees that the government is in a financial crisis, tightening the deadlock over the demand by public workers for a significant rise in salaries amid threats of a strike next week.

Biti and Public Service Minister Eliphas Mukonoweshuro met representatives of state employees on Thursday, when the finance minister said resources are tight.

Negotiators had issued an ultimatum demanding an increase in the base pay rate to US$500 a month, roughly equal to the monthly cost of living for an average family. Civil servants dismissed the small pay increases offered by the government early this month putting the base rate for public employees at US$168 a month.

Despite talk of a strike, sources say workers are not unified on how to proceed, some arguing for an industrial action, others proposing to seek an audience with president Robert Mugabe, who will be on annual leave until February 8.

Public Service Minister Mukonoweshuro told VOA Studio 7 reporter Blessing Zulu that negotiations with representatives of state workers will continue.

Progressive Teachers Union of Zimbabwe Secretary General Raymond Majongwe said the two ministers wanted discussions Thursday to remain secret.

Zimbabwe Teachers Association Chief Executive Officer Sifiso Ndlovu told reporter Brenda Moyo that his organization won’t call a strike until all avenues of negotiation with the government have been explored.

Elsewhere, ZANU-PF members staged a violent demonstration at Town House in Harare to protest the recent slashing of maize crops in the Kuwadzana and Glenview suburbs, but council officials said that they had not ordered the destruction of crops.

VOA Studio 7 correspondent Thomas Chiripasi reported on the protest

Big Power Cuts in Zimbabwe Cities Unrelated to 2009 Estimated Bills - ZESA

ZESA Public Relations Manager Fullard Gwasira said that while the utility did not write off estimated bills , indications are that some people delay paying their bills until they can no longer afford to settle them
Gibbs Dube
Washington 21 January 2011
A spokesman for the Zimbabwe Electricity Supply Authority on Friday dismissed reports the parastatal has disconnected power supplies to Zimbabweans in urban areas based on 2009 estimated bills which a regulatory body had ordered it to write down.

ZESA Public Relations Manager Fullard Gwasira said that although the estimated bills were not written off by the electrical utility, indications were that some customers delay paying their power bills until they can no longer afford to settle them.

Gwasira said the Competitions, Pricing and Tariff Commission ordered a revision of the bills based on meter readings. He could not account for bills as high as US$600 in some cases.

Residents who have been cut off said bills were based on 2009 estimated usage.

Gwasira said consumers must pay their electricity bills in order to continue receiving power from the utility. “We are currently not disconnecting power on estimated bills but for electricity consumers used over a long time without paying for it,” he said