Written on February 14, 2010 at 2:08 PM by Kabweza
Telecel Slashes International Call Rates To As Low As A Local Call

Starting today, if you have a Telecel mobile line and need to call someone in the US, the UK, Australia, the Emirates, China or India, you will be charged local call rates. Calls to these destinations can now be made for as little as 25 US cents. Note though that this doesn’t apply to calls to Vodafone numbers in the UK.

This compares quite favorably to making international calls on other Zim mobile networks (Econet and NetOne) which costs anything between US $0.30 and US$8,70 depending on the international grouping of the destination.

“We are now offering our subscribers the opportunity to make international calls to seven selected countries for the same cost as a local call. The selected countries are distant countries where there are substantial numbers of Zimbabweans or where Zimbabweans have significant business or trade interests and opportunities”, explained a Telecel spokesperson in a news release sent to us.

Worth pointing out that South Africa is strangely missing from this list. Our southern neighbour is home to a million plus brothers and sisters who fled the nasty economic situation that befell our beloved Zimbabwe this whole past decade.

Local rates for call to International destinations is likely to give Telecel an edge over the biggest mobile operator, Econet (who would be well advised to cook up something similar or better, sooner than later) The exclusion of South Africa and Vodafone UK numbers takes away some benefit but is sure not a deal breaker for most subscribers. In fact, some Econet subscribers will probably just buy a parallel Telecel line for international calls.

There’s no information on whether this is a temporary promotion or just the new effective rates to last for as long as it makes business sense for Telecel. We hope it’s the later!

Telecel Zimbabwe, which is affiliated to international telecommunications company Orascom Telecom, recently revealed it will soon be launching data services on its network.

Feb. 9 -- Zimbabwe passed a law that compels all businesses with assets worth more than $500,000 to be 51 percent black-owned within five years, according to a copy of the law distributed by Harare-based Veritas Trust.

The law was published in the Government Gazette, a public document. It comes into effect March 1 and stipulates prison sentences of up to five years for non-compliance. Veritas is a Harare-based non-governmental organization that monitors the passage of laws through parliament and their publication.

The new law may affect companies including Anglo Platinum Ltd., Impala Platinum Holdings Ltd. and Aquarius Platinum Ltd., three of the world’s four biggest producers of the metal, which all own mines in the southern African nation. Old Mutual Plc, Africa’s biggest insurer, owns properties and a life-insurance operation in the country.

“The news is very grim,” John Robertson, a Harare-based economist, said in a phone interview today from the capital. “It will effectively put a halt to any further investment in Zimbabwe, ironically just as the country is calling for investment.”

Zimbabwe has the world’s second-largest reserves of platinum and chrome, after South Africa, along with deposits of gold, coal, diamonds and nickel. The economy is recovering from a decade of recession that followed Zimbabwean President Robert Mugabe’s seizure of white-owned commercial farms to redistribute to black subsistence farmers deprived of land during colonial rule. The program slashed exports.

Disposal Plans

The new law states that “every existing business” must submit forms detailing ownership of companies by April 15, along with plans for the disposal of 51 percent of their shareholdings to black Zimbabweans.

Businesses that fail to comply after a 30-day reminder will be guilty of an offense and liable to a fine and or a jail sentence of as much as five years, according to the gazette.

Spokesmen from Mugabe’s Zimbabwe African National Union- Patriotic Front, which pushed the bill through parliament, didn’t answer calls to their offices or mobile phones today. Mugabe’s spokesman, George Charamba, didn’t answer calls to his office either.

The law, known as the Indigenization and Empowerment Act, was passed by parliament in 2008 without being signed into law by Mugabe. Zanu-PF controlled parliament from 1980 until March 2009, when it lost elections to the MDC.

Old Mutual’s London-based spokesman Matthew Gregorowski couldn’t immediately comment when contacted on his mobile phone today.

Another wave of diamond rush has hit Zimbabwe sparking a fierce battle to control the field site. This time diamonds said to be of high industrial quality have been found at the remote countryside of Chipinge in the eastern part of the country close to Mozambique.
Hundreds of illegal diamond miners including foreigners are flocking to the area.

A diamond rush at the famous Chiadzwa in 2006 led to a spike in criminal activities in the Eastern district of Marange as well as widespread environmental degradation. State security agents subsequently moved in to secure the area and legitimate mining operations have been established.

At the peak of looting in Chiadzwa, Zimbabwe was losing millions of dollars monthly to mineral leakages. This raised an outcry from the international community to ban Zimbabwe diamonds.

The bulk of the diamonds are finding their way to Mozambique’s Manica Province where a ready market is reportedly available. Buyers from Harare have invaded the area, but it is believed that Lebanese citizens are in the forefront.
  

Panners in Chipinge have built temporary settlements and police sources said a full-scale blitz on them would soon be launched.

Police have been carrying out periodic raids at the sites following reports of violence among the panners.

“The area has become a battlefield and there are reports everyday of miners fighting each other over control of mining claims. We hear that some people have even killed each other there,” Chief Muusha claimed.

He said some of the illegal miners were well equipped with modern mining equipment. “It is surprising that some of these panners have this equipment and we now suspect that they are being sponsored by powerful people.

“More people are getting to know about these diamonds as some even come from distant places, causing a rise in the clashes at the site and more deaths,” he said.

Meanwhile, unconfirmed reports at the weekend suggests that a secret airstrip is being built in a diamond of Chiadzwa to enable clandestine weapons shipments.

A kilometer long runway is said to be intended for arms shipments, for which troops loyal to President Robert Mugabe would pay on the spot with gemstones from the Chiadzwa diamond mines.

According to human rights groups, hundreds of independent miners were killed when soldiers seized control of the Chiadzwa area in November 2006.

China has long been Zimbabwe’s main source of arms, but delivery has been more difficult since a shipment was blocked in South Africa three years ago. Other deliveries have come in through the Mozambican port of Beira, but government officials in the country’s capital, Maputo, have expressed concern over the issue.

Zimbabwean bank mulled in UK 
Written by Staff Correspondent    
Tuesday, 26 January 2010 11:36 
LONDON (Zimbabwe Investor) - Zimbabweans in the United Kingdom are mulling setting up their own financial institution by way of a Credit Union to attend to their specific banking needs.

The Zimbabwe Diaspora Credit Union Limited, according to the promoters, is a bank that will cater for all Zimbabweans who live and work in Great Britain and Northern Ireland offering them various financial products.

“By creating our own credit union, which caters for all Zimbabweans who live and work in the United Kingdom, we will be able to reward sustainable behaviour by offering better interest rates for Loans, Mortgages, and supportive loan programs for those who lack credit ratings” read part of the memo circulated via email by one of the idea’s promoters Barbara Nyagomo.

The memo goes on to say, “We are no longer willing to participate in the non-ethical use of our financial resources. That is why those of us in the Zim Diaspora Credit Union Limited decided to undertake the task of forming a credit union based on Zim Diaspora ethics”

The credit union is seeking authorisation from the Financial Services Authority (FSA), UK’s financial regulator, and registration with the Association of British Credit Unions Limited (ABCUL). ABCUL is a trade association for British credit unions.

In November 2009, the FSA tightened the rules for credit unions by increasing capital and liquidity requirements to offer better protection for customers and avoid failures and defaults. Changes by the FSA on require smaller unions to meet a minimum capital-to-assets ratio of 3 percent -- previously they only had to be solvent -- and have raised start-up capital requirements to 10,000 pounds for small unions and 50,000 pounds for larger ones.

Harare - The US embassy in Zimbabwe on Wednesday confirmed a report in the state-run Herald newspaper that the US would not oppose the restoration of Zimbabwe's voting rights in the International Monetary Fund (IMF).

The US has since 2001 blocked funding from the IMF and World Bank to censure the regime of President Robert Mugabe for violent suppression of political opponents and reckless economic policies that turned the once prosperous nation into a failed state.

The Herald quoted US Ambassador Charles Ray saying: "We would want to assure Zimbabwe that once the issue of restoring Zimbabwe's voting rights is put forward for debate at the next IMF sitting, America will fully support the motion."

Those comments signal a major shift in Washington's tough stance towards Harare, according to diplomats.

US embassy spokesperson Tim Gerhardson said that Ray, who took up his post late last year, had added in his brief interview with the Herald that the US would not, however, table or initiate a motion for the restoration of Harare's voting rights in the IMF.

Mired in poverty

Diplomats said it was clear that the concession announced by Ray did not stretch to targeted sanctions against Mugabe's inner circle, which forbids them from entering the United States and from investing there. Most Western governments have similar bans against top officials from Mugabe's ruling Zanu-PF party.

The move follows repeated appeals from pro-democracy Prime Minister Morgan Tsvangirai, partner in a unity government with Mugabe since February 2009.

Zimbabwe's economy has showed significant improvement since Mugabe's policies were ditched but economists say Zimbabweans will remain mired in poverty without major international assistance.

Zimbabwe lost its rights to borrow money from the IMF and the World Bank in the late 1990s when the government fell seriously into arrears on loan repayments.

Diplomats say, however, that the US has never had to exercise its veto against Zimbabwe borrowing, because the regime was already disqualified by its combined arrears of $1.1bn to the IMF, the World Bank and subsidiary the African Development Bank.

Econet Wireless Zimbabwe (EWZ) has emerged as the country’s leading cellular telephone operating company in the country. Information made available by the company shows it has a subscriber base that exceeds 3 million subscribers in Zimbabwe.

In a statement released recently, EWZ Chief Executive Officer, Douglas Mboweni, said the company had exceeded the 3,1 million subscribers mark by the end of last year. Mboweni said Econet Wireless had anticipated strong demand for its products and services in the run up to the Christmas holidays.

This he said, had seem the network provider increase its capacity to more than 4 million subscribers on its various platforms.

Econet Wireless Zimbabwe communications manager, Rangarirai Mberi said: “Therefore, the company made extensive preparations, which included boosting network capacity to over 4 million, and also importing tens of thousands of new phones. The company also expanded its dealer network across the country to improve availability of products, particularly SIM cards”.

Mberi described the growth of Econet as being one of the most spectacular on the African continent this year.

This time last year, the company had only 987,743 subscribers; this means the company, in just one year, has registered a growth of 204%.

“This massive growth has been made possible by the huge investment of US$250m that the company has undertaken over the past year. This investment represents the largest investment by any company, in any sector of the Zimbabwe economy, for over a decade. This has allowed the company to build its network, as well as introduce a wider range of new products and services that are not available on other networks“.

Meanwhile, another service provider, Telecel Zimbabwe also announced last year, it was embarking on expansion works aimed at boosting its service provision to the public.

Word on the market has it that Telecel Zimbabwe had entered into a joint partnership with a South African company, Celtel that saw the former getting investment to upgrade its network.

Celtel is yet to issue a public statement on the said merger.

Said Telecel Zimbabwe: “Telecel Zimbabwe would like to inform its subscribers and general members of the public that it has embarked on a project to upgrade its network with an aim of expanding capacity. The scope of works has been in two phases with the first phase basically targeting Harare and Bulawayo. In these two centres, we have been installing capacity by pulling out selected base stations and replacing them with high capacity equipment.

“The objective has been to eliminate any form of congestion. We are happy to announce that this exercise has been completed successfully and has resulted in the availability of 100.000 lines details of which will be provided in due course”.

The country’s third cellular services provider, NetOne has however been silent on its expansion programs. But sources close to the company said there were plans by the company to pull a fast one on its competitors.

“The company is obviously clear it can not afford to sit back and watch as companies as small as Telecel continue to upgrade their services. There are plans to launch services that would include release of new lines and upgrades of platforms so that NetOne becomes a major player and competitor in the market”, the source said.

By Louis Charbonneau

UNITED NATIONS  - The United States, the EU and other Western powers blasted the U.N. General Assembly on Friday for ignoring Zimbabwe's reported failure to comply with international efforts to curb trade in "blood diamonds."

The 192-nation body adopted a resolution warning that "trade in conflict diamonds continues to be a matter of serious international concern" and increased vigilance was vital.

The assembly was responding to a report on conflict stones by Namibia, which chairs the diamond industry's Kimberley Process, a certification scheme set up in 2003 in the wake of devastating civil wars in Angola, Sierra Leone and Liberia.

Those wars were largely financed by the diamond trade.

Although the resolution was adopted, a number of Western delegations criticized the assembly for failing to mention concerns about Zimbabwe, which is suspected of not complying with Kimberley Process safeguards.

Namibia's report to Secretary-General Ban Ki-moon said there were "credible indications of significant non-compliance with the minimum requirements of the (Kimberley Process) by Zimbabwe."

U.S. delegate Laura Ross said: "We regret that language reflecting this concern has not been included in the text of this resolution."

Speaking on behalf of the European Union, Sweden's U.N. Ambassador Anders Liden voiced similar views, as did delegates from Japan, Australia and Canada.

Zimbabwe's U.N. Ambassador Boniface Chidyausiku rejected the suggestion that Harare was not complying with the rules.

"We are committed to the Kimberley Process," he told the assembly, adding that the United States and others were trying to politicize the issue by attacking his country.

Zimbabwe was one of the resolution's co-sponsors.

Before the implementation of the Kimberley Process, conflict stones made up about 15 percent of the world market. They are believed to account for less than 1 percent of stones traded today, although many diamonds remain untraceable.

The Namibian report warned that blood diamonds could be making a comeback. It said Internet sales and postal shipments "have become issues of concern, as it has proved difficult to track and reconcile rough diamond shipments."

In January, Israel replaces Namibia as the chair of the Kimberley Process. The United States, European Union and other Western delegations complained that the assembly resolution failed to welcome Israel's 2010 chairmanship.

The adopted resolution simply "takes note" that Israel will chair the Kimberley Process. Bashar Ja'afari, the ambassador of Israel's enemy Syria, proposed removing any mention of the Jewish state from the resolution, but his motion was defeated.

A United Nations panel of experts said in October that Israel, whose diamond trade is worth more than $10 billion, may be involved in the illegal export and sale of blood diamonds from Ivory Coast. Israeli officials rejected the accusation.

Harare 04 December 2009    The German ambassador to Zimbabwe says Western countries and major international financial institutions have changed their engagement with the country's inclusive government during the past few months. The countries, who have aligned themselves in a group they call Friends of Zimbabwe, have established ways to begin financing the rebuilding of the country's shattered infrastructure.

"Donor support, for the time being, cannot be done through classical instruments like financial aid or budgetary aid as Zimbabwe is not yet out of the corner it had maneuvered itself into over the past 10 years," says German ambassador to Zimbabwe.
The German ambassador to Zimbabwe says Western countries and major international financial institutions have changed their engagement with the country's inclusive government during the past few months. The countries, who have aligned themselves in a group they call Friends of Zimbabwe, have established ways to begin financing the rebuilding of the country's shattered infrastructure.

German Ambassador Albrecht Conze explained how the Friends of Zimbabwe group agreed in October to a new formula that has taken international funding from providing only humanitarian assistance to funding developmental projects.  He said this was a response to greater political stability in Zimbabwe.

Addressing a media briefing in Harare, Conze said under the new formula the money is held in a trust fund managed by the World Bank and distributed by the United Nations.

"Donor support, for the time being, cannot be done through classical instruments like financial aid or budgetary aid as Zimbabwe is not yet out of the corner it had maneuvered itself into over the past 10 years," he said.

He added that two sectors, agriculture and education, are receiving assistance from the trust fund.

The Friends of Zimbabwe includes the United States, Australia, Canada, Denmark, Finland, France, Germany, Ireland, Italy, Japan, Netherlands, New Zealand, Norway, Spain, Sweden, Switzerland, the United Kingdom, the European Commission, the European Union, the International Monetary Fund, the World Bank, the African Development Bank, and the United Nations. 

Conze said the group wanted to support Zimbabwe's transitional government, even while limited U.S. and EU sanctions exist that do not allow government-to-government aid.

He said Finance Minister Tendai Biti's budget was a dramatic example of the need for donor support.

"There is a clear indication that more than $800 million are missing," he said. "He knows he can only get this from donors.  Where else should he get it from?  Zimbabwe is still working on a cash budget, the country has practically no credit lines, its international rating does not permit it going to the capital market."

Conze said the Western countries hoped all outstanding issues of the so-called global political agreement (GPA) which led to formation of the unity government in February would soon be implemented. 

"Once this GPA has been implemented and once you have your new constitution and once you have free and fair elections, [then] that is more or less the road map for full engagement of the international community," Conze said.

He added that the Friends of Zimbabwe group hoped the country would be able to regain its voting rights at the International Monetary Fund's spring meeting next June.

Conze said that attitudes of the West towards Zimbabwe had been strongly influenced by Prime Minister Morgan Tsvangirai's statement earlier this year that although President Robert Mugabe was part of Zimbabwe's problems, he was also key to solving the country's 10-year crisis

Dec. 2  -- Zimbabwe’s Finance Minister Tendai Biti forecast a budget deficit of 40.5 percent of gross domestic product next year as the government uses foreign aid to help pull the economy out of recession.

Government spending will reach $2.25 billion, while revenue increases to $1.44 billion, leaving a shortfall of about $810 million, Biti said in a telephone interview from the capital, Harare.

“This will hopefully be funded by foreign aid or by drawing down of the $510 million we received from the IMF,” Biti said. “Sixty-three percent of the budget will be spent on employment costs and we will spend only 5 percent on capital projects.”

Speaking to lawmakers today, Biti raised his forecast for growth this year to 4.7 percent from 3.7 percent, and said economic expansion would accelerate to 7 percent next year. Zimbabwe is emerging from a 10-year recession triggered by the seizure of white-owned farms by the government of President Robert Mugabe.

The Movement for Democratic Change, of which Biti is a member, joined the government earlier this year in an attempt to stem the economic decline and end a political crisis.

Biti had said the budget would be limited by a lack of foreign aid.

Encouraging Growth

“The budget will encourage economic growth, though the country will be constrained by the need to spend only what we earn,” Biti said in an interview on Nov. 30.

The minister increased this year’s budget by 22 percent to $1.22 billion in July, after receiving some loans and aid pledges from South Africa and the International Monetary Fund.

Since then, it hasn’t managed to attract “a cent” in budgetary support because donors are wary of the central bank, Biti said in November.

The power-sharing government’s biggest success has been the reduction of inflation from 500 billion percent in January of this year after it ditched the local currency in favor of the dollar and South African rand.

Consumer prices are expected to decline by an average of 5.5 percent this year, before rising 5.1 percent in 2010, Biti said in a phone interview today.

Central bank Governor Gideon Gono had fueled inflation by printing money to compensate for shrinking fiscal revenue.

PRESIDENT Rupiah Banda and his Zimbabwean counterpart Robert Mugabe will officially launch the Chirundu One Stop Border Post (OSBP) on Saturday.

The Zambian Government contributed about K150 billion towards the construction of some infrastructure at Chirundu OSBP, which is expected to enhance trade and investment in the region.

UK Department for International Development (DFID) head of southern Africa Helen Mealins, commended the Zambian and the Zimbabwean governments for their effort to launch the OSBP.

Ms Mealins said the DFID and the UK government were proud to be partners to the OSBP project.

She said this in Lusaka yesterday during the Chirundu OSBP Press conference in a speech read for her by DFID regional growth and trade advisor, Liz Winton.

The Press conference was organised by the Common Market for Eastern and Southern Africa, East African Community (COMESA) and the Southern African Development Community (SADC).

"DFID celebrates the opening of the Chirundu OSBP and looks forward to seeing further one stop border posts open across the region. The UK government is strongly committed to supporting Africa's drive for regional integration," she said.

Ms Mealins said DFID had over the past three years provided approximately one million pounds in support of one stop border posts in the region.

She said DFID's 100 million pound trademark for the southern African programme, was launched on November 1, and is scheduled to support work on reducing delays at five other border posts in the region.

"DFID believes that investing in physical infrastructure such as border posts as well as improving the regulatory environment for trade and transport along the North South Corridor will transform trade and investment opportunities in the region.

It will also increase the region's prospects for generating growth, creating jobs and reducing poverty," she said.

Ms Mealins said delays at border posts along the North South Corridor were one of the biggest constraints to trade in the region thus increasing costs for business and making imports uncompetitive and more expensive.

Once the single stop becomes operational, delays at Chirundu will fall by between 30 and 50 per cent.

Japanese Ambassador to Zambia Hideto Mitamura expressed happiness at the final launch of the Chirundu OSBP.

Mr Mitamura said his country supported the initiative and constructed a bridge at a cost of US$ 30 million.

"The government of Japan congratulates the efforts made by Zambia and Zimbabwe as well as other stakeholders to ensure the launch of the Chirundu OSBP," he said.

COMESA director of infrastructure development Amos Marawa said his regional body took a lead to ensure the Chirundu OSBP was operational.

Mr Marawa expressed hope that the East African Community would also take a lead on the proposed setting up of Nakonde OSBP.

Ministry of Commerce, Trade and Industry economist Hillary Kumwenda said the OSBP initiative would bring a lot of benefits to manufacturers and consumers by reducing the cost of doing business.

OSBP project manager Kingsley Chanda said the successful implementation of the Chirundu OSBP was an important milestone in the trade facilitation agenda of the region and would contribute significantly to making the North South Corridor more efficient.

02.12.09- Zimbabwe’s Finance Minister Tendai Biti will probably keep a tight rein on spending when he announces the 2010 budget tomorrow after the country failed to attract donor aid as it emerges from a decade-long recession.

“The budget will encourage economic growth, though the country will be constrained by the need to spend only what we earn,” Biti said in a telephone interview from Harare yesterday. He declined to give further details.

Biti has said the government can’t spend beyond its means after the ruling coalition, which includes the party of President Robert Mugabe, failed to enact the reforms supported by foreign donors. Parliament is currently debating a law that will curb central bank powers.

Biti’s Movement for Democratic Change has blamed central bank Governor Gideon Gono for much of the country’s economic crisis. The bank accumulated debt of $1.5 billion last year alone, in addition to the $4.7 billion the country racked up over the past 20 years, he said on Nov. 11. It also fueled inflation by printing money.

“Zimbabweans will have to understand that there is very little money and that government is basically broke,” said John Robertson, an independent economist in Harare. “The finance minister is likely to present a budget that spends only what the country earns because there aren’t any significant signs of foreign aid on the horizon.”

Not a Cent

Biti increased this year’s budget by 22 percent to $1.22 billion in July, after receiving some loans and aid pledges from South Africa and the International Monetary Fund.

Since then, it hasn’t managed to attract “a cent” in budgetary support because donors are wary of the central bank, Biti said in November.

The economy contracted 40 percent between 2000 and 2007 after Mugabe seized white-owned farms, according to the IMF. There are no figures available for the past two years.

The IMF expects gross domestic product to grow about 3.7 percent this year, the first expansion in more than a decade.

The Movement for Democratic Change formed a power-sharing government with Mugabe’s Zimbabwe African National Union- Patriotic Front early this year in an attempt to stem the decade of economic decline and political crisis.

The new government’s biggest success has been the reduction of the inflation rate to about zero from 500 billion percent in January this year after it ditched the local currency. Zimbabweans now use mainly U.S. dollars and South African rand for financial transactions.

01.12. 09 Harare - German investment in Zimbabwe continues to be under threat because of ongoing lawlessness in the southern African country, the German government protested in an official complaint to Zimbabwe, it emerged Tuesday. The letter sent by the German embassy in Harare, which is dated November 26 but was only received by journalists on Tuesday, follows an attempt by some Zimbabweans to take over a German-owned farm near the border with Botswana.

Members of President Robert Mugabe's nationalist Zanu-PF party have seized thousands of white-owned farms, often without compensation, over the past nine years.

"Once again, the German Embassy notes with great concern that property rights of German nationals and their investments in Zimbabwe are put under threat, which is a clear violation of international law," the letter said.

"Despite repeated confirmations of high ranking representatives of the Zimbabwean Government about the latter's intention to honour the BIPPA (Bilateral Investment Protection Agreement) in full, the development on the ground so far shows few commitment to these clear announcements," the letter said.

Foreign Minister Simbarashe Mumbengwegwi confirmed he had received the letter.

"We are going to look at the concerns of the letter and communicate with the Germans," he said.

The letter is the second official protest by Germany to Zimbabwe.

Last month, Berlin protested to Harare over the beating meted to a 51-year-old German Catholic priest by soldiers in Zimbabwe.

Farmers protected from Zimbabwe deal
Nov 26, 2009 4:04 PM

South African farmers in Zimbabwe will not forfeit their land or investments as a result of a bilateral agreement still to be signed, a Pretoria judge ordered.

Responding to an urgent application to halt the signing of the promotion and reciprocal protection of investments agreement (Bippa) Judge Roelof du Plessis congratulated both parties for reaching a settlement.

"This is a big step the government [of South Africa] has taken. I believe this order is going to go far in assisting our citizens who have investments in Zimbabwe," he said.

The order also upheld government's assurance that it honoured a Southern African Development Community (SADC) tribunal finding that Zimbabwe's land reform programme was discriminatory.

This means that while the order protects investments from the time of the signing of Friday's agreement, South Africans who have already lost their land to expropriation will have to cite the tribunal finding in claims for compensation.

Lobby group Afriforum who brought the application alongside Zimbabwean farmers said the Bippa was generally understood to have the effect to exclude the enforcement of the SADC tribunal's orders, and to exempt Zimbabwe from liability for past human rights violations.

They believed it contravened South Africa's Constitution and international law and had been unable to discuss it with the trade and industry minister.

Speaking outside the court, Afriforum's legal representative Willie Spies said it was a "huge victory".

"It's a victory for the rule of law and it has spared the South African government the embarrassment of being unable to sign the agreement. It's a good day for Zimbabweans."

Spies said, however, it had been unfortunate that the government had been forced to court to hear the plight of its citizens across the border.

"It is actually a pity, unfortunately we only got this settlement after filing papers," he said.

Farmer and applicant in the matter Louis Fick - who faces prosecution for failing to vacate his farm in Zimbabwe - said he was "very relieved".

"We have been trying to get the government involved," Fick said adding that farmers had been battling for nine years.

"I am relieved that our protection has been granted. As we speak, three farmers have been klapped [had their farms taken away). It's never stopped in Zimbabwe."

When asked if he felt the ruling might aid in his defence against a prison term he said: "I hope so, but I'm not unrealistic about Zimbabwe."

The tribunal referred to took place in November 2008. It said Zimbabwe's land reform programme "constituted racial discrimination, an infringement of the right of access to courts, and an arbitrary taking without adequate compensation, each in breach of Zimbabwe's treaty obligations".

Business Unity SA said it would travel to Harare to observe the signing, but would not participate as it had not been consulted, nor seen the terms.

A legal representative for government would not comment on the record. Read the article below.

S African farmers dismayed by Zimbabwe deal
By Tony Hawkins in Harare

Published: November 26 2009 16:27 | Last updated: November 26 2009 16:27

South Africa and Zimbabwe will sign a bilateral trade agreement on Friday that the Zimbabwe government sees as a step towards rebuilding investor confidence but which has dismayed farmers in both countries.

The agreement, ten years in the making, is highly contentious because it fails to offer any hope of redress to hundreds of South African farmers whose land was expropriated by President Robert Mugabe’s government under its infamous land reform programme.

Some 244 South African farmers who lost their land in Zimbabwe are now threatening legal action against their own government. Agri-SA the leading farming union in South Africa says that signing the agreement is tantamount to “retrospective approval” of the Mugabe government’s land policies.

The agreement has also been criticized by white Zimbabwe farmers who have been campaigning for compensation for lands seized over the last 10 years. One former farmer says that “anything that appears to legalise the land takeovers will make it even more difficult for us to secure compensation”.

The Zimbabwe Commercial Farmers Union which represents past and present white farmers obtained a legal opinion on the draft treaty from a prominent South African advocate, Mr Jeremy Gauntlett.

His assessment was that the investment agreement “constitutes a breach of South Africa’s legal obligations” and that in signing it, the South African government will be in violation of its own constitution as well as other international agreements to which it is a signatory.

South Africa is the largest single foreign investor in Zimbabwe and the Harare government hopes the treaty will serve as “a confidence-building platform” for foreign investors generally, not just those from South Africa.

Zimbabwe desperately needs foreign capital. Elton Mangoma, economic planning minister, said recently that the country will need to raise $15.8bn to finance its ambitious medium-term economic recovery plan. Since the domestic savings base was annilihated by hyperinflation in 2007/8, almost all this funding will have to come from abroad.

But with the country’s fragile unity government unable or unwilling to put an end to ongoing farm invasions by Mugabe loyalists and with mixed signals from ministers about the future of the country’s “indigenisation” programme – requiring foreign investors to enter joint ventures with local investors who must own at least 51 per cent of the equity – foreign investors are hanging fire.

They are waiting to see whether this week’s negotiations between the three parties comprising Zimbabwe’s “inclusive government” can reconcile their differences in a manner that will help restore confidence.

The teams from President Mugabe’s Zanu-PF, Prime Minister Morgan Tsvangirai’s Movement for Democratic Change and the minority splinter wing of the MDC led by Mr Arthur Mutambara are scheduled to complete their talks by December 6.

By Carli Lourens

Nov. 25  -- Rapaport Group’s RapNet Diamond Trading Network, the world’s biggest, banned its members from dealing in gems from Zimbabwe’s Marange fields because of reports of “severe” human rights violations in the area.

“Rapaport believes that blood diamonds from the Marange fields have been legally exported to the diamond cutting centers with Kimberley Process Certificates and may now be reaching retailers as polished diamonds,” the New York-based company said in a statement e-mailed today.

The Kimberley Process, created to curb trade in gems mined to fund conflict and war, decided against suspending Zimbabwe this month following allegations of abuse. New York-based Human Rights Watch says more than 200 were killed last year as the army and police cleared as many as 20,000 illegal miners from Marange. Zimbabwe police say they had no reports of atrocities.

Marange was seized by the government from U.K.-listed African Consolidated Resources Plc in 2006 after gems were found at the site.

“The Kimberley Process is being used as a fig leaf to cover up human rights abuses in the diamond sector,” Rapaport Chairman Martin Rapaport said in the statement.

He called on world diamond trading and production bodies to expel members who deal in Marange diamonds, which can be identified before they are polished. RapNet says it has more than 4,100 members in 80 countries and daily online listings of gems worth more than $4 billion.

Old Mutual

Kimberley Process officials weren’t immediately able to comment when Bloomberg News called their offices today in Windhoek, Namibia.

Mauritius-based Grandwell, part owned by South African scrap metal recycler New Reclamation Group Ltd., in a venture with Zimbabwe’s government has begun mining in Marange, the Zimbabwe state-controlled Herald newspaper reported on Nov. 11. New Reclamation is part owned by Old Mutual Plc.

Reclamation Chief Executive Officer Michael Movsas wasn’t available when Bloomberg called his Johannesburg office. Lynn Bolin, head of media and communications at Old Mutual Investment Group, couldn’t immediately comment when Bloomberg reached her by phone today.

18/11/09 THE government of Zimbabwe and a Chinese joint venture company yesterday signed five strategic co-operation agreements that will see the country receive US$8 billion in investment deals in several sectors of the economy.

The deal with China Sonangol, a joint venture company between China and Angola, represents the single largest foreign direct investment since the formation of the inclusive Government and one of the largest since independence.

The investment will be in gold and platinum refining, oil and gas exploration, fuel procurement and distribution, and housing development.

A "significant" amount of the money is already being held by local financial institutions involved in the deals.

In a speech after the signing ceremony, the Chief Secretary in the Office of the President and Cabinet, Dr Misheck Sibanda, said the deal was an indication of the success of the Look East Policy adopted by Government four years ago.

"The signing of the five Memoranda of Understanding bears testimony to the relevance and efficacy of the Look East Policy.

"It is hoped that the co-operation will continue to grow from strength to strength and through such efforts it is only a question of time before Zimbabwe becomes the jewel of Africa," said Dr Sibanda.

Zimbabwe requires approximately US$8 billion to revive the economy as envisaged under the Short-Term Emergency Recovery Programme, but the mobilisation of funds has been affected by the illegal sanctions imposed on the country by some Western countries.

Dr Sibanda urged these countries to remove their economic embargo on Zimbabwe to facilitate expeditious turnaround.

"We continue to call for the removal of illegal Western sanctions in order to speed up our economic recovery process," said Dr Sibanda.

He said Zimbabwe remained committed to addressing all issues of concern to allay any fears foreign investors might have.

Reserve Bank of Zimbabwe Governor Dr Gideon Gono said the deals signed yesterday were of great importance to Zimbabwe’s economic recovery.

"This deal represents the most significant inward investment inflow in Zimbabwe. This comes at a time when the country is being ridiculed left, right and centre.

"The various banking and financial institutions that are handling this deal can’t believe the huge inflows that have come in already," he said.

He could not reveal how much exactly had already come in, but emphasised once more that it was a significant figure.

Dr Gono applauded the Chinese for being all-weather friends, especially during the difficult times the country experienced over the past decade.

China Sonangol chairman Manuel Vicente hailed the historically good relations between Zimbabwe, China and Angola.

"Zimbabwe, Angola and China enjoy good relations in their South-South co-operation. Zimbabwe is a land of opportunities with great potential," he said.

Company deputy general manager Kelvin Kwan confirmed the huge amounts of money involved and expressed confidence in Zimbabwe’s economy.

At the recent Forum on China-Africa Co-operation summit in Egypt, Chinese Premier Wen Jiabao and President Mugabe held bilateral talks after which Zimbabwean Foreign Affairs officials revealed that Beijing would soon unveil a new development assistance package.

China has stood by Zimbabwe since the days of the liberation struggle.

Over the past decade when the West began its onslaught on Zimbabwe over the revolutionary land reform programme, Beijing has been instrumental in keeping the economy afloat.

China has provided support in various sectors including agriculture, health and manufacturing, and has defended the country against machinations by Western countries to have the country put on the United Nations Security Council agenda. -

Political analyst, Dr Tafataona Mahoso, said the world should realise that the West was not interested in helping developing countries and was more concerned with protecting its own interests.

"This pledge made by the Chinese is a sign that those who are interested in providing bullets and guns to peaceful nations are not capable of providing economic assistance and expertise. Our people need not to look just to the West for solutions." He said Western "aid" came with stifling conditions that compromised independence.

Zanu PF Politburo member, Dr Sikhanyiso Ndlovu, said China's pledge strengthened the relationship between the two countries.

US$5 billion loan deal

In July this year, the government revealed that Zimbabwe and China signed a US$5 billion loan deal securing half of the amount the inclusive Government needs in delivering its Short Term Emergency Recovery Programme (Sterp).

The deal became the largest deal that has ever been signed between the two countries and is secured on various mining and infrastructural development rights.

Sources in Harare say Finance minister Tendai Biti and Reserve Bank officials on June 8 signed a Memorandum of Understanding (MoU) with China Exim Bank (CEB) guaranteeing the loan.

CEB is the export and credit guarantee agency of the Chinese government in Africa. The bank has played an important role in fostering the rapid expansion of Chinese trade and investment in Africa.

Under the deal Zimbabwe will get US$5 billion from CEB and in return the Chinese get some equity in a US$40 billion platinum concession.

Prime Minister Morgan Tsvangirai at the time, also announced that Zimbabwe had secured a US$950 million credit lines from the Chinese government.

HARARE, Nov 18  - Zimbabwe's parliament on Wednesday unanimously approved a bill to reform the central bank, including reducing the powers of the bank governor accused by critics of policies that ruined the economy.

Finance Minister Tendai Biti said last week the government had failed to attract funding from foreign donors for next year's budget because they feared the money could be misused by the Reserve Bank.

The bill is the first major law to be passed by parliament since the formation of a unity government between Prime Minister Morgan Tsvangirai and rival President Robert Mugabe in February.

The Reserve Bank of Zimbabwe Bill will reduce the powers of the governor by appointing an independent chairperson and board, and restrict the bank to dealing with interest rates, currency management and regulating banks.

The governor's core function would be to chair a planned monetary policy committee.

"There have been extreme discussions with the Minister (Biti) that there be amendments ... and we have agreed on these amendments," Paul Mangwana, a member of parliament's legal committee and from Mugabe's ZANU-PF party told parliament.

The bill will now be debated in the upper Senate, and if approved would be signed by Mugabe.

ZANU-PF legislators had last week threatened to block the bill, arguing that it targeted central bank governor Gideon Gono, a Mugabe ally with whom Biti has had an uneasy relationship.

But an agreement was reached between Biti and ZANU-PF lawmakers to make changes to the bill, including a clause giving immunity to the bank governor and employees "for anything done in good faith and without negligence".

Biti had, before his appointment, been vocal against Gono, at one time calling him "the country's number one enemy".

Critics blame Gono for policies that helped cripple the economy -- stoking inflation by printing money and taking over functions of the national treasury, including buying farming inputs and extending financial support to government departments.

Tsvangirai and Mugabe are locked in a dispute on how to share power, with the former trade union leader accusing Mugabe of refusing to appoint a new central bank governor and attorney general as part of a political pact signed last year.

Mugabe has vowed that Gono will not be sacked.

By Mary–Jane Ncube

HARARE - Transparency International’s popular annual Corruption Perception Index commonly known as the CPI was launched on 17 November 2009. 

Zimbabwe’s score moved up as Zimbabwe became number 146 along with Cameroon, Ecuador, Kenya, Russia, Sierra Leone and Timor Leste with a score of 2.2 of a possible 10.

This is a 0.4 improvement from 2008 where Zimbabwe had a score of 1.8 and was number 160 of 180 countries surveyed.

This is a positive sign for Zimbabwe however perceptual the index maybe as perceptions, especially those of international investors, donors, as well as international business have over the years come to refer a lot to the ranking of the survey.

TI Zimbabwe, along with many other Zimbabweans is encouraged by the score. It is of course hoped that this points to improved governance especially in the areas of public financial management and public service delivery. 

The question TI Z is posing for the government and public is whether we can attribute this improvement to the formation of the Government of National Unity (GNU), shaky as its foundations may be?

The question cannot be immediately answered and requires further investigation, however TI Zimbabwe’s past Chairperson, Professor John Makumbe shared his immediate reaction to the scores and the slight improvement in the ranking.

Professor Makumbe has called the improvement an “apparent [upward] movement” that can only marginally be attributed to the change of governance structures through the inclusion of the two MDC formations.

While this has contributed to the improved levels of accountability and transparency; the improvement so far, has largely been in appearance.

The improved levels of transparency for example may be as a result of closer scrutiny of government than they has been before as evidenced by Mrs Chisi’s Comptroller and Auditor General’s special report of the first quarter of 2009.

Professor Makumbe is however of the view that the first and foremost reason for the apparent decrease in corruption is that there is in the current environment nothing to steal. Officially the State has been bankrupt since December 2008.

The dollarization of the economy also helped to kill off currency speculation that was driving hyperinflation and corruption.

Second, he proffers that the virtual collapse of industry and commerce, mainly the manufacturing sector and mining sector have meant little interface between public – private enterprises, and even between private and private. 

The interface between public - private is usually where most grand corruption takes place. In addition investors have shied away from Zimbabwe because of poor or seemingly politically motivated regulations.

Another important point cited by the Professor is that in the last nine months, most support has come to government and the public sector through credit lines that are difficult to manipulate by corrupt individuals.

If corruption is an opportunistic crime there appears to have been less opportunities in 2009 to be corrupt because of the dollarization, State bankruptcy, lack of investors, and the improved scrutiny on government spending seem to have all frustrated opportunities for corruption.

The CPI refers to the perceptions of the degree of public sector corruption in a country as seen by business people and country analysts and ranges from 10 (highly clean) and 0 (highly corrupt).

In the speech launching the 2009 CPI, the TI International board Chairperson Mrs. Huguette Labelle (www.transparency.org) commented that corruption blocks operations of good governance and long term economic sustainability.

There is a need for independent and competent investigative and oversight bodies.  Her speech highlights that poor countries, fragile and unstable states such as Zimbabwe tend to linger at the bottom of the index pointing to the huge toll in their capacity to govern.

To stem corruption strong oversight from parliament, a well performing judiciary, independent and properly resourced audit and anti corruption agencies, vigorous  law enforcement, transparency in public budgets, revenue and aid flows as well as space for independent and responsible media and a vibrant civil society are critical.

Where these are weak, corruption spirals out of control, resulting in mercenary individuals looting state resources consequently leading to a loss of trust in all public institutions.

Mrs. Labelle’s appeal to the investors and donor community is that they should not shun the lowest scoring countries but rather that the index is an indication of their need for continued support in the strengthening of these institutions of governance.

She also calls on the investor and donor communities to be vigilant of their own processes and accountable of their own actions to the same degree they demand of beneficiaries. 

The Government and people of Zimbabwe are all stakeholders in the fight against corruption to ensure that the country is saved from the scourge that has spiralled out of control in the last 10 years.

The governance of our institutions and recovery of the nation is dependent on how much we invest financially, politically and morally into ridding our country of all forms of corruption for positive development to start to take place.

Adherence and implementation of international instruments such as the UN Convention against Corruption, AU Convention for the Prevention and Combating of Corruption and Related Crimes and the SADC Protocol Against Corruption need to be monitored closely by all stakeholders.

Mary–Jane Ncube is the Executive Director of  Transparency International Zimbabwe

10/11/09 HARARE – Zimbabwe and South Africa are set to sign a Bilateral Investment Protection Agreement (BIPA) later this month, a Cabinet minister said at the launch of the country's six-year economic blue print on Monday.
"The issue of signing BIPAs is one of the things to be done," Economic Planning Minister Elton Mangoma said at the launch of the country's medium term economic blueprint for the period 2010-2015.
"The BIPA between Zimbabwe and South Africa will be signed on November 27," he said without revealing the venue for the inking of the long stalled agreement.
Signing of the agreement between the countries that are each other’s biggest trading partner on the continent in addition to being strong political allies has on several occasions been postponed on the eleventh hour, apparently after Harare objected to a clause in the accord referring to land investments.
The Economic Planning Minister also ruled out the return of the local currency that was shelved early this year in preference of a basket of foreign currencies that include the United States dollar, South African rand, British Pound and Botswana pula.
"It must be clear that the way we are planning our economy is to have a strong currency which is not the Zimbabwe dollar. The Zimbabwe dollar will bring its own problems and we don't want those problems," he said.
Mangoma said the major focus of the 2010 to 2015 economic blueprint that replaces the Short Term Economic Recovery Programme (STERP) that was launched in March is to bring economic growth as well to reduce poverty.
He added that the country needed to improve its investment climate to attract investors.
"We want investors everywhere to feel secure, we believe from our side the document is good and we believe they (South Africans) feel the same," he said without elaborating whether Zimbabwe had accepted the demand by the South Africans to have protection of land and related property rights included in the agreement.
He said he hopes to sign and implement bilateral trade agreements with other countries which will improve investor confidence and to raise money through auctioning mineral concessions and implement the “use it or lose it” on the mineral concessions.
President Robert Mugabe’s chaotic and often violent programme to seize white-owned farm land for redistribution to landless blacks also saw several farms owned by foreigners and protected under bilateral trade agreements between Zimbabwe and other countries seized without compensation.
The seizure of private land has raised questions about Zimbabwe’s commitment to uphold property rights as well as agreements entered with other countries.

WINDHOEK — A global scheme to ban trade in conflict diamonds on Thursday adopted a "work plan" for Zimbabwe, despite calls for the country to be suspended over rights abuses in its gem fields.

"Zimbabwe is not suspended as was proposed, a joint work plan was adopted by this plenary meeting," said outgoing chair of the Kimberley Process (KP) and Namibian deputy mining minister Bernard Esau late Thursday.

A KP review mission in July recommended a six-month suspension of Zimbabwe over human rights abuses alleged by the army against civilians in the eastern Marange diamond fields.

Zimbabwe had "until June 2010 to implement the work plan," said Esau, who visited the area in September, without giving further details on what the plan entailed.

"It was felt that we should give Zimbabwe the opportunity to address issues of compliance to remove like removing the military from the Marange diamond fields," he said.

"If Zimbabwe is not compliant at the next review meeting in June 2010, the KP will have to think of other measures, but let us give them a chance."

In a joint communique issued at the end of the four-day meeting, the 37 participating members which attended welcomed "Zimbabwe's commitment to urgently start implementation of the joint work plan."

The communique called on KP participants to ensure compliance with the system's certification scheme in Zimbabwe and to apply vigilance measures to contain illicit trade of Marange diamonds.

"The work plan was adopted by all parties attending the plenary, including Zimbabwe," Esau told reporters.

Civil society groups which are part of the process had demanded the suspension of Zimbabwe's international diamond trade.

4/11/09 Representatives of Zimbabwean non-governmental organizations attending a Kimberly Process Certification Scheme meeting in Namibia scrutinizing the country's management of a diamond field in the east of the country where human rights abuses and smuggling have been reported said Tuesday they were threatened by a state delegation.

NGO sources lobbying the Kimberly Process for action against Zimbabwe said they were threatened with unspecified action by Zimbabwe Mines Minister Obert Mpofu, who is heading a team of 29 seeking to avoid imposition of a ban on the sale of Zimbabwean diamonds.

The minister was said to have been incensed at the presence in Windhoek of representatives of Zimbabwean NGOs urging imposition of the ban on Zimbabwean diamond exports over human rights and other violations in the Marange field of Manicaland province.

NGO sources said the government team in particular targeted Mutare-based activist Farai Maguwu, at one point physically manhandling him.

The Canadian delegation issued a statement critical of the Zimbabwean minister and calling on the Zimbabwean government to allow activists to work unhindered, sources said.

Studio Seven was unable to reach Maguwu, who sources said left the meeting, or Mpofu.

For perspective, VOA Studio 7 reporter Sandra Nyaira turned to Manicaland parliamentarian Pishai Muchauraya of the Movement for Democratic Change formation of Prime Minister Morgan Tsvangirai, who has been deeply involved in the Marange crisis.

The Zimbabwe case has been referred to the Kimberly Process's participatory committee chaired by India, which was to render a decision on Thursday.

Sources said China and Russia were surprisingly in support of Zimbabwe’s suspension while South Africa, Namibia and the Democratic Republic of Congo opposed the action.

The Kimberley Process Civil Society Coalition has issued a statement saying Zimbabwe has failed to meet international standards set forth by the Kimberly Process and should be suspended from importing and exporting rough diamonds.

The NGO coalition, whose members include Global Witness, Partnership Africa Canada and Green Advocates of Liberia, was calling on Kimberly Process member countries to act on the allegations of human rights abuses within the Zimbabwean diamond industry.

The Kimberly Process administers mechanisms intended to ensure that diamonds do not fund conflicts and are not mined under conditions that violate human rights. Its 48 participants represent 74 countries with the European Community counting as a single participant.

"Since the discovery in 2006 of significant alluvial diamond deposits in Marange, eastern Zimbabwe, controls over the diamond sector have been nonexistent and communities in and around the diamond fields have borne the brunt of a series of brutal measures to restore state control over the area," declared a statement issued by Global Witness.

"The authorities have failed to stop the military from carrying out abuses and profiting from the illicit trade in diamonds, effectively condoning - and perhaps even encouraging - the looting and attendant violence against civilians," Global Witness said.

The Civil Society Coalition highlights the need for KP reforms including binding human rights provisions for Kimberly Process members; faster Kimberly decision-making to facilitate swift action; formation of an independent statistical and research analysis unit; and ensuring that diamond profits are at least partly used to promote development initiatives.

A Kimberly Process review mission went to Zimbabwe in July and found that Harare was not meeting Kimberly standards. Its recommendation that Zimbabwe not be allowed to import or export diamonds under the Kimberly process "until such time as a KP team determines that minimum standards have been met" was harshly criticized by Mpofu.

Human Rights Watch reported in June that the Zimbabwean military had killed more than 200 unauthorized diamond diggers in Marange in late 2008 and was profiting from the diamond trade. The group said last week that such abuses and diamond smuggling continue.

The Zimbabwean government continues denied any killings by the military in Marange. 
 

ZIMBABWE'S opposition MDC said it would boycott the country's power-sharing government until sticking points have been resolved and a political deal is reached, sparking the biggest crisis since the administration was formed nine months ago.

Prime Minister Morgan Tsvangirai said on Friday his Movement for Democratic Change would disengage from President Robert Mugabe's "dishonest and unreliable" Zanu PF party in the country's unity cabinet set up in February.

"It is our right to disengage from a dishonest and unreliable partner. In this regard, whilst being in government we shall forthwith disengage from Zanu PF and in particular from cabinet and the council of ministers until such time as confidence and respect are restored amongst us," Tsvangirai told reporters.

The fresh crisis in Zimbabwe comes after a court this week ordered the prison detention of Roy Bennett, a senior MDC official, and ruled that he should stand trial on terrorism charges.

Zimbabwe's High Court will rule later on Friday on a bail application brought by Bennett's lawyers. He is charged with illegally possessing arms for purposes or committing acts of terrorism which carries a maximum death sentence. Bennett denies the charge.

Tsvangirai said the detention of Bennett showed that Mugabe and his Zanu PF party regarded the MDC as a junior partner and that the power-sharing administration would collapse if the president continued his unilateral rule.

"The ... detention of our party treasurer Roy Bennett has brought home the fiction of the credibility and integrity of the transitional government. It has brought home the self-evident fact that Zanu PF see us as a junior, fickle and unserious movement," Tsvangirai said.

Tsvangirai said if the new constitutional crisis escalated further, it would only be resolved by holding fresh elections under supervision of the United Nations and regional body the Southern African Development Community.

Analysts said the MDC's decision illustrated that the settlement, brokered by former South African President Thabo Mbeki last year, was not stable.

"I think it continues to underline the fact that this is not a stable settlement. It's a settlement which Tsvangirai went into because SADC pushed him into it," said Steven Friedman, director at the Centre for the Study of Democracy in Johannesburg.

But constitutional lawyer and prominent Mugabe critic Lovemore Madhuku wondered how the MDC's stance would work in practise.

"This is a senseless position. It doesn’t make sense. It has no meaning," Madhuku told SW Radio Africa. "If you are still in government that is engaging Zanu PF because that government is an inclusive government. There is no concept of running a ministry which is different from being in government.

"This is all part of the thinking that the Zimbabwean public and everyone else is still so gullible to keep hearing these antics. They (MDC) must make up their minds, either they are in government or they are completely out of it. There is no concept of a half-way house.”

Oct 12, 2009

Australia has partnered with the World Bank to provide support to poor Zimbabwean farmers, the Australian High Commission in Pretoria said.
In a statement, the High Commission said Australia would provide USD7 million to the World Bank Global Food Crisis Response Program to expand maize production and food security in Zimbabwe during the 2009-10 summer cropping season.

The program would distribute quality certified maize seed to more than 300,000 poor smallholder farmers across Zimbabwe.

Australia's Ambassador to Zimbabwe, John Courtney, said Australia's contribution to the program was part of a co-ordinated donor community effort that was an important first step to support the recovery of Zimbabwe's grain production.

"Up to 17 non-government organisations will distribute these seeds to poor farmers in time for the coming planting season to expand planted areas and raise crop yields in the communal areas," Courtney said.

"Boosting farmers' capacity to meet their household grain requirements will help reduce Zimbabwe's dependence on expensive grain imports and food aid," he said.

Courtney said the program would complement those of other donors and directly support the agricultural sector revitalisation plan outlined in the Inclusive Government's Short Term Emergency Recovery Plan.

"This program builds on the extensive experience of all participants in distributing seed and fertiliser to farmers under humanitarian programs," he said.

While most of the seed would be distributed directly to smallholder farmers, the project would also support the revival of rural retail markets for agricultural inputs through a seed voucher program.

"Under this strategy the project will support the sale of 280 tons of hybrid maize seed through rural retailers in exchange for seed vouchers provided to some 28,000 needy rural families," Courtney explained, adding that his country and the World Bank worked in close partnership to reduce global poverty.

He said Australia had been at the forefront of international efforts - both political and humanitarian - to assist Zimbabwe and, since the establishment of the inclusive government a little over one year ago, had provided more than 20 million Australian dollars in assistance.

HARARE, Oct 6 - Zimbabwe's parliament will debate legal reforms badly needed by the battered economy, including the crucial mining sector, in coming weeks, but analysts say foreign investors will wait to see how the laws are applied.  

President Robert Mugabe opens a new session of parliament on Tuesday which officials say will consider amendments to the Mines and Minerals Act and a bill governing the operations of the central bank.

Mugabe told a mining conference last month that the government would pass a law on the sector soon and would address concerns raised by an earlier draft that would have given locals control of mining operations owned by foreign companies.

Several mining firms, including the world's two biggest platinum producers, Anglo Platinum ( AGPPY.PK - news - people ) and Impala Platinum, have retained operations in Zimbabwe but largely put new projects on hold, fearing the mines could be taken over by the state.

Details of the new legislation have not been published, but analysts say investors will be looking for a firm commitment by the power-sharing government to private property rights and the rule of law.
The new law will be very important but the most important issue for investors will be to see how the law is applied in practice,' said John Robertson, a Harare-based economic consultant.

'We have such a bad history here now that nobody takes the government on its word, and so any good words will have to be accompanied by good deeds,' he said.

INVESTMENT ON HOLD

After the collapse of commercial agriculture, mining emerged as Zimbabwe's largest foreign currency earner, with gold alone bringing in a third of total mineral export receipts.

Analysts say uncertainty over government policy will likely hold back big new mining investment in Zimbabwe for years as many foreign investors are still shaken by Mugabe's seizures of white-owned farms for redistribution to blacks under an empowerment drive.

Foreign companies with operations in Zimbabwe include Angloplat, Implats and Rio Tinto ( RTP - news - people ) , majority owner in the country's biggest diamond mine.

Mugabe formed a unity government with opposition leader and arch-rival Morgan Tsvangirai in February to try to end a decade-long political crisis which ruined Zimbabwe's once prosperous economy.

But the fragile coalition between Mugabe's ZANU-PF party and Tsvangirai's Movement for Democratic Change (MDC) is threatened by policy differences, the slow pace of reforms and feuding over some top state jobs.

Besides the mining bill, the new session of parliament -- which runs for a year -- is expected to consider changes to the operations of the central bank.

Central bank governor Gideon Gono, a Mugabe ally, has had a strained relationship with Finance Minister Tendai Biti, a senior MDC figure. Biti will present the 2010 national budget to parliament next month.

The government says it needs up to $10 billion in foreign aid to help repair an economy which saw inflation surge to over 500 billion percent in 2008, according to the IMF.

In January, the government introduced foreign currencies to stem the hyperinflation that had made the Zimbabwe dollar worthless. Inflation fell to 0.4 percent in August from one percent in July.

2/10/09 The Pinetown-based company that sold state-of-the-art dairy equipment to Grace Mugabe for her farm, did not know they were doing business with the wife of Zimbabwean President Robert Mugabe and regrets the deal.

Grace Mugabe established a dairy farm, Gushungo Dairy Estate, on one of the six farms she acquired after they were seized from white owners, and is selling milk to Nestle Zimbabwe.

The farms, some among the most valuable in the country, have fallen into ruin. She is apparently running this particular farm at a huge loss despite millions of rands worth of dairy equipment having been supplied and installed.

Delaval supplied Grace Mugabe with the dairy equipment imported mainly from Germany, Sweden and Poland.

The company's national spokesperson, Rykie Visser, did not respond to the Daily News's various messages and voice mail messages. However, on Tuesday Delaval's international spokesperson and vice-president of marketing and communications, Benoit Passard, said they became aware of who they were doing business with only after reading recent articles in various newspapers about the sale.

When asked why the company had completed a business transaction with Zimbabwe and the Mugabe family despite sanctions, he said: "We regret that this has happened. We first made contact with the SA Dairy Association and then a long list of investors. The Mugabe name was never mentioned. This has come as a surprise to us and we would never have done business with them had we known this was who we were dealing with."

The United Nations and the European Union have placed sanctions on Zimbabwe.

Passard said they were reviewing this transaction and taking the matter very seriously. The Daily News asked if the Pinetown-based company would be taken to task for their actions. "It's still too early in our investigation to say," was his response.

Nestle Zimbabwe on Tuesday said it had no choice but to buy milk from Grace Mugabe's farm because many of its suppliers had gone out of business.

1/10/09 HARARE — The World Bank on Wednesday announced a 74-million-dollar grant to revive Zimbabwe's agriculture sector.

"The money is 74 million dollars up from 25 million last year," David Rohrbach, a senior agricultural economist at the World Bank, told reporters on the sidelines of an agriculture conference in the capital Harare.

The bank hopes the money will help 700,000 farmers, said Rohrbach.

"We are dealing directly with NGOs. We are following suit with what other donors have done to help Zimbabwe. We are not yet at a stage to deal with government directly but we consult them," he said.

The announcement came as a new report -- prepared for the conference by donors and the government -- said compensation had been paid for about three percent of the 6,500 white-owned farms seized under Mugabe's land reforms.

The study said land reforms had drastically reduced the area of land under cultivation by 50,000 hectares (123,500 acres) and lands under irrigation also declined more than nine percent to 139,500 hectares.

Mugabe launched the land reforms in 2000, with at least 4,000 white farmers forcibly removed from their properties. He has defended the programme as meant to correct colonial-era imbalances.

Black farmers resettled on the land have received little government support, while banks have been unwilling to offer them loans without legal guarantees on ownership of the land.

Production of both food and cash crops like tobacco have plunged, leaving millions of people dependent on international food aid.

Secretary for agriculture Ngoni Masoka told a media briefing at the predicted a jump in crop production this year.

"This year the preparations are much more advanced compared to last year," he said. "Even in terms of funding, this year we are better prepared.

Mugabe in February joined former rival Morgan Tsvangirai, now prime minister, in a unity government tasked with returning Zimbabwe to stability after years of economic ruin.

1/10/09 HARARE – ZIMBABWE - BARCLAYS Zimbabwe has started providing Visa facilities on their automated teller machines for individuals who hold Visa-branded cards issued by other banks.

Holders of Visa-branded cards issued by banks outside Zimbabwe that are international can withdraw US dollars cash from Barclays ATMs countrywide.

The accessibility of Visa on Barclays ATMs has globalised the Zimbabwean banking environment and provided tourists with a financial solution away from home.

Commenting on the activation of Visa on all Barclays ATMs, Barclays acting managing director, Lawrence Nyazema, said: “This is a good achievement, not only for Barclays, but for all sectors as this allows visitors coming into Zimbabwe to access banking services via the ATM.

This has been a key issue since the economy dollarised, and it is pleasing that Barclays has been able to contribute to making Zimbabwe an easier destination to visit.”

Barclays retail director, Francis Ruwanda, added: “Our partnership with Visa has allowed us to offer service convenience to all Visa card holders, including Zimbabweans with offshore accounts.”

The dollarisation of the economy without the use of international credit cards has discouraged international tourists from visiting the country.

Zimbabwe’s tourism sector, like almost all other sectors of the economy, is operating on a cash basis but most international tourists prefer to use plastic money.

In most cases, up to 99 percent of international tourists rely on plastic money.

29/09/09 Trading resumed in February, after the local currency was abandoned and a unity government was formed between President Robert Mugabe and his long-time rival, Prime Minister Morgan Tsvangirai.

Since then the value of monthly trade is up 20-fold, though that's coming off a base of just $2.5m. ZSE boss Emmanuel Munyukwi said this still shows signs of at least cautious optimism in the country.

"This is a sign that confidence is coming back to the bourse when compared to last year," he said.

"There has been huge interest on our counters. Most of the buyers are foreigners especially from South Africa and United Kingdom."

Confidence in the use of US dollar

Monthly trading peaked in June at $57m but has since slowed. Munyukwi expects the September figures to register around $50m.

Without a local currency, trading is now conducted in US dollars, limiting currency risks for foreign investors, Munyukwi said.

That's brought stability to a market ravaged by inflation estimated in multiples of billions last year, said Dzikamai Danha, an analyst with Renaissance Capital, a Russia-based company that tracks emerging markets.

"The real reason why the economy has stabilised and the real reason why the stock exchange has had a fine rally... is as result of confidence in the use of the US dollar, which does not fluctuate like the Zimbabwe dollar," Danha said.

"Last year, the ZSE in terms of business was actually smaller to that of Botswana, Malawi and Zambia," some of the world's smallest markets, he said.

Danha expects ZSE market capitalisation to be $4.1bn by year end, representing a 138% increase over the quarter ending in June, but still tiny even compared to neighbouring South Africa's bourse.

Political noise

Significant political risks remain, as Mugabe and Tsvangirai publicly feud over key appointments, including the naming of the central bank governor.

"Although the political noise surrounding these disagreements has intensified in recent months, we do not believe any break in the government is imminent," Danha said.

But Jonathan Waters, analyst at the economic and financial data group Zfn, said despite the gains this year, the market remains far off its historic peaks.

The ZSE had a market capitalisation of about $9bn in mid-1997, before inflation began surging.

Last year at the height of the hyperinflation, the market was capitalised at about $4bn, against $3.5bn last week, he said.

"So in fact it's gone backwards," Waters said.

First dollarised results

But as companies adjust to doing business in a dollarised economy, some are performing surprisingly well, while foreign investors have begun returning to Zimbabwe, he said.

"Between $50m to $150m has certainly come into the country" this year from foreign investors, Waters said, adding that banks had performed well in their first quarterly results under the new financial regime.

"Our first dollarised results for the period to June have just been released, and we have been surprised by the performance of the banks," he said.

Although 79 firms are listed on the ZSE, 10 dominate trading - most of them local subsidiaries of banks such as Barclays and Old Mutual, as well as local telecom Econet.

Zimbabwe’s Kingdom Meikles Africa Ltd. postponed an emergency general meeting scheduled for today until an unspecified date, it said in an e-mailed statement.

The postponement follows a government order on Sept. 18 which put under state administration some of the company’s units, including Tanganda Tea Co., the country’s largest tea producer. Lawyers representing the Meikles family and John Moxon, the company’s biggest shareholders, have described the move as “null and void.”

Kingdom Meikles was scheduled to meet today to discuss the separation of Kingdom, a banking company, from Meikles Africa, which owns retail shops and hotels, as well as tea and cotton companies.

Armed riot police prevented the EGM from taking place, dispersing company executives who had arrived for the meeting, the Associated Press reported. Calls to the head offices of both Kingdom and Meikles weren’t answered when Bloomberg News called seeking comment.

The company was formed in January last year by combining Kingdom Financial Holdings Ltd. and Meikles Africa Ltd. The company said on June 26 that it would de-merge after disagreements between John Moxon, who had been the biggest shareholder in Meikles Africa, and Kingdom Meikles’ former Chief Executive Officer, Nigel Chanakira. It didn’t give further details.

Riot police have prevented shareholders of one of Zimbabwe's largest companies from gathering after a judge issued an order postponing the meeting for two weeks.

Dozens of executives in business suits had to disperse Thursday from the planned Kingdom Meikles meeting. Meikles executives are demanding the ouster of chief executive Chanakira, who has refused to quit. An ally of President Robert Mugabe, Chanakira was given the job to comply with a 2005 law that white-owned businesses have 51 percent black shareholders.

Meikles has banking, investment, supermarket, agricultural and retail interests, and a leading Harare hotel. At a shareholders' meeting earlier this year, 90 percent of stockholders voted to split from Chanakira's Kingdom Bank.

Zimbabwean Finance Minister Tendai Biti on Tuesday dismissed a request by Reserve Bank of Zimbabwe Governor Gideon Gono for the principals in the unity government to intervene in a dispute between the two men over the use of hundreds of millions of U.S. dollars that the International Monetary Fund recently made available to the country.

The special credit line of US$510 million was extended under a Group of 20 facility to help developing countries deal with the impact of the global economic downturn.

Gono reportedly said President Robert Mugabe, Prime Minister Morgan Tsvangirai and Deputy Prime minister Arthur Mutambara - head of a rival MDC grouping - should instruct Biti to tap the US$510 million line to step up the pace of economic recovery.

Mr. Tsvangirai's formation of the Movement for Democratic Change, of which Biti is secretary general, has been demanding the removal of Gono from his post at the central bank, but Mr. Mugabe, who reappointed Gono in late 2008, has adamantly refused to do so.

The finance minister earlier said that if Zimbabwe, which has US$5.7 billion in external debt, drew on the credit line, it would do so in order to rebuild the national infrastructure.

Biti,in an exclusive interview said that as finance minister he is the sole authority authorized to tap those funds, whose use must be approved by parliament, while issuing a scathing denunciation of Gono as the architect of Zimbabwe's steep economic decline over the past decade.

Zimbabwean and international non-governmental organizations are criss-crossing Europe at present drawing the attention of governments and civil society groups to human rights violations in the Marange diamond fields of eastern Manicaland province.

Representatives of the London-based Zimbabwe NGO Forum, the Center for Research and Development of Mutare, Zimbabwe, and Human Rights Watch have been meeting with foreign ministry officials and European NGOs to discuss whether Zimbabwean diamonds should be barred from world markets by the Kimberly Certification Process over the human rights violations which a Kimberly Process team recently documented on the spot.

Charges by Human Rights Watch that the Zimbabwean military units in control of the alluvial diamond field have murdered at least 200 people and forced others to mine diamonds were subsequently backed up by members of the Kimberly Process mission to the area.

The human rights delegation has visited Belgium and the Netherlands and will be meeting with various interlocutors this week in Switzerland and Germany, its members said.

World Diamond Council Chairman Eli Izhakoff told VOA that Harare has not yet responded to the final report issued by the Kimberly Process inspection team. He said it is hoped that Zimbabwe will have acted on the abuses before a meeting in Namibia in November.

Director Farai Maguwu of the Center for Research and Development in Mutare, Zimbabwe, near the diamond field, said that the human rights groups represented by the delegation are much concerned at how the diamond field Marange district, discovered in recent years, has caused conflict.

 21Sept. -- Econet Wireless Zimbabwe Ltd., Zimbabwe’s biggest mobile phone operator, will spend a further $30 million expanding its third-generation network, the company said today.

Demand for 3G services has “completely surpassed all projections,” Douglas Mboweni, Econet Zimbabwe’s chief executive officer, said on the company’s Web site.

Third-generation technology will be rolled out to all parts of Zimbabwe by December, Mboweni said. The expansion was authorized by parent company Econet Wireless Holdings Ltd., the statement added.

Econet Zimbabwe launched 3G services in the capital, Harare, last month. The company said Aug. 3 that it would spend $94 million expanding its network.

Econet competes with state-owned NetOne and Orascom Telecom Holdings SAE-owned Telecel in Zimbabwe. It has 52 percent of the Zimbabwean market, according to the company’s Web site.

The operator has mobile networks in several African nations and in New Zealand, and a satellite business in Europe.

HARARE — Zimbabwe plans to use 400 million dollars in recently announced IMF support to rebuild the nation's crumbling infrastructure, Finance Minister Tendai Biti said on Wednesday.

But he said the country also needs to attract foreign investment, because most donors are still reluctant to give direct aid to the unity government of long-ruling President Robert Mugabe and Prime Minister Morgan Tsvangirai.

The International Monetary Fund (IMF) offered Zimbabwe about 400 million dollars (272 million euros) in so-called Special Drawing Rights (SDRs), part of a 250 billion dollar scheme offered to all of its 186 members.

But the SDRs are not part of normal loan programmes, which put cash directly into state coffers, tied to strict conditions on its use.

To convert the SDRs into hard currency, Zimbabwe would have to find another country to buy them.

"We have got a vision for that money," Biti told the meeting of mining firms in the capital Harare. "The bulk of that money will go towards infrastructure development."

"It's going to be a long while before Zimbabwe has bilateral aid coming to Zimbabwe. We need to look at foreign direct investments," he said.

"A lot of friends are still sulking" over the unity government, he added. "For a long while, we are still on our own."

Zimbabwe convened the mining conference to try to lure foreign firms back into the country to revive the troubled industry, which has been hit by power cuts, tough government restrictions and threats of expropriation.

Since Biti became finance minister, the government has loosed currency and import restrictions, making it easier for companies to operate.

After years of economic contraction, the World Bank predicts Zimbabwe's economy will grow by 3.7 percent this year.

Biti said he plans to simplify taxes to lure investment, cut debt and won’t restore use of the country’s currency until annual exports more than double.

Zimbabwe needs to cut the number of taxes, restore annual exports to between $3 and $5 billion, a level last seen in about 1996, and tackle its debt “overhang” before it restores its own currency, Biti said. Exports totaled $1.52 billion last year, according to the Reserve Bank of Zimbabwe.

“The challenge for us is to broaden our tax base and to simplify it,” Biti told a mining conference in the capital, Harare, today. “Our thinking generally is to move to a flat rate of tax.”

In February, President Robert Mugabe and former opposition leader Morgan Tsvangirai formed a coalition government after intervention by the Southern African Development Community of neighboring states to end a 10-year political crisis. The economy, once the second-biggest in southern Africa after South Africa, suffered a decade-long recession that ended this year.

In mining alone, there are 15 different tax rates and a number of exemptions have cut the “effective” tax rate in that industry to 8 percent from 15 percent, he said. The top personal income tax rate is 47.5 percent.

Zimbabwe may look to emulate a simpler tax code adopted by Georgia, Biti said

500 Billion Percent

Under Georgia’s tax code, introduced in 2005, the number of taxes was cut from 21 to six, including a flat personal income tax rate of 25 percent that will fall to 15 percent by 2013, according to the government’s Web site. The country has no capital gains, inheritance or social taxes.

The government of the African country abandoned the Zimbabwe dollar this year in favor of currencies including the U.S. dollar and the South African rand in a bid to tame the world’s highest inflation rate. Inflation reached almost 500 billion percent in September last year, according to the International Monetary Fund. It is currently running at a monthly rate of 0.4 percent. Annual figures are not available.

Biti has forecast positive growth this year and Elton Mangoma, the minister of economic planning and investment promotion, told the conference that the country will expand at “double-digit” levels from next year.

Zimbabwe plans to consider new mining laws and will aim to make the country “attractive” for investment, Mugabe said in a speech at the conference.

The country currently has less than $2 million in import reserves, Biti said in an earlier interview. Total national debt is $4.7 billion, he added.

09/04/09  HARARE, ZIMBABWE — The International Monetary Fund has released $500 million to Zimbabwe as the world slowly starts to accept the southern African country's new coalition government.

Reserve Bank governor Gideon Gono announced the payment Thursday.

The IMF, which had suspended Zimbabwe in 2001, resumed limited help in May, citing "significant improvement in cooperation on economic policies." Zimbabwe owes billions of dollars to the IMF and other creditors.

The unity government, formed by longtime President Robert Mugabe with Morgan Tsvangirai's Movement for Democratic Change, is trying to turn around an economic crisis that began with a land distribution campaign in 2000. The often-violent campaign disrupted the agriculture-based economy of what was once the region's breadbasket.

Zimbabwe’s banks will raise wages for their lowest-paid employees by 86 percent for the three months to September 30, the Herald said, without saying where it got the information.

Bank employees will now receive $345 a month, including transport and housing allowances, backdated to July 1, up from $185 a month they have been paid since February, the Harare- based newspaper said on its Web site. The newspaper gave no other details.

Most Zimbabweans have been paid in U.S. dollars since February, when the government abandoned the use of the Zimbabwe dollar, which had been eroded by the world’s highest rate of inflation at the time. The country now uses multiple currencies, with the U.S. dollar and South African rand being the most popular.

12/08/09 Cape Town- There are signs of economic recovery in Zimbabwe, thanks to a change in the political landscape, indicating that now might be the best time to invest. But the government of national unity (GNU) is still facing monumental challenges.

The question is how far is it prepared to go to propel economic recovery?

A key catalyst for a turnaround remains securing external funding, a major challenge for finance minister Tendai Biti who has the unenviable task of finding means to clear the US$5 billion debt Zimbabwe owes to foreign creditors, in order to restore a credit rating that can attract loans from the private markets.

While the reaction from some western donors has been lukewarm, the Southern Africa Development Community's (SADC) promise to help raise the US$8.3 billion the country needs to fund its Short-Term Recovery Programme (STERP) should prove to skeptics that Zimbabwe is ready to do business.

The Development Bank of Southern Africa (DBSA) is also supporting Zimbabwe's economic recovery plan. Instead of adopting a "wait and see" strategy, the DBSA is taking the bull by the horns with a number of promising transactions under consideration. DBSA is considering projects in the energy, telecommunications, mining and agribusiness sectors. (These are amongst the sectors being promoted by the official Zimbabwe Investment Authority.)

"We are confident of growing this pipeline to include other sectors, and we are also confident that the downward cycle in Zimbabwe has turned for the better," says DBSA's chief economist Sam Muradzikwa.

Also eyeing Zimbabwe is Botswana's VPB Ltd, which is launching a €150 million private equity fund designed to benefit companies operating in targeted sectors in the SADC region, according to chief investment officer Ndaba Mpofu. "Recent changes will hopefully usher in a period of sustained economic growth and stability for that country," he says.

Companies from South Africa, the European Union, the US, and Australia are already looking at projects in mining, agriculture and the manufacturing of primary products. Canadian Caledonia Mining recently announced it would double gold production from its Zimbabwe mines, while steel maker Arcelor Mittal's South African unit is reportedly interested in taking over state-owned Zimbabwe Iron & steel Co. Agro-processing firm Tongaat Hulett plans to inject R145 million in its sugar mills in Zimbabwe to restore full productivity.

The signing of the Bilateral Investment Promotion and Protection Agreement between South Africa and Zimbabwe is crucial and will boost confidence amongst South African investors wanting to enter the country. "Zimbabwe's recovery will largely depend on the will of the government to provide a conducive environment for investment. Signing bilateral trade and investment treaties with investment protection guarantees will indicate its commitment to facilitate operations of the private sector," says Tinei Muwandi, an audit manager at Ernst & Young.

The GNU hit the ground running and already some policy reforms have been put in place, including the dollarisation of the economy and the re-opening of the Zimbabwe Stock Exchange. Investor interest has sharpened with most betting on the country to deliver decent returns once the unity government is working properly.

For investors who got in early, like mobile operator Econet and agribusiness firm Delta Corp, dollarisation of the economy in April rewarded their foresight, enabling companies to achieve quick gains, with Econet reaching a market cap of $500 million from $200 million.

Challenges in Zimbabwe

Investors now have some security but also recognize that all markets carry a measure of currency risk. Challenges for financing in Zimbabwe include political risk factors with potential investors waiting to see if the GNU will remain in place to implement a sustainable economic recovery.

"Currently the situation is quite delicate due to the rapid and complete dollarisation and due to the absence of liquidity in the local money market. However, the prospects look fairly good, especially if dollar inflows into the country - via foreign direct investment (FDI), credit lines and balance of payments support - will lead to increased intermediation within the banking sector," says the DBSA's Muradzikwa.

The mystery of the vanishing balance sheets wiped out by hyperinflation, which rendered accounting procedures impossible, has made asset values of Zimbabwe companies hard to determine. "You have no historical financial statements that can be referred to when considering project financing," says Muradzikwa.

Rather than be scared off by the risk, Zimvest - an investment company which provides investors with a wide range of viable investment opportunities - is looking at available investment vehicles at its disposal to mitigate risk. "The decade long period where there was little or no investment has opened up a myriad of opportunities present day. I think everything should be put in context - doing business and investing in Africa as whole is not easy. The foundation has been laid in Zimbabwe and now investors need to take advantage of that," says Zimvest's managing director Shaun Lightfoot.

Zimbabwe is set apart from many other African countries by its comparatively good infrastructure - a dream for foreign investors dealing in emerging markets. Considering the current scarcity of investment opportunities in the global economy, changes happening in Zimbabwe should rank it as a favoured option for investment.

Promising investment sectors

Investor interest over the last few years has been in portfolio investment at the Zimbabwe Stock Exchange and in mining. Currently most businesses are in need of recapitalisation. Privatisation of potentially profitable parastatals (including Air Zimbabwe, the National Rail, Cold Storage Company and Tel One) offers significant investment opportunities.

According to investment analysts the mining sector - with abundant reserves of gold, platinum, coal, diamonds, nickel, iron ore, copper and coal-bed methane - is attractive for foreign investors. The sector is currently the largest single contributor to export earnings with the potential to create downstream industries including retailing. The implementation of favourable policies could see mining attracting between $6 billion and $16 billion in exploration and mine development during the 2011-2018 period, the GNU estimates.

Agriculture, tourism, ICT, energy, infrastructure, financial services and retail sectors are also poised to offer lucrative opportunities. The government is actively pursuing the rehabilitation and expansion of all infrastructure and massive opportunities exist in dam and road construction, provision of urban housing on land provided by the State, and construction of energy and communication networks.

"We are banking on these projects to take off because of the huge opportunities that have the potential to improve our balance sheets ruined by the effects of the financial downturn in the industry," says Tito Mpungose whose South African based firm supplies construction and building materials in the region.

Many operators are optimistic that tourism will be one of the first sectors to recover as international arrivals increase. Although in need of recapitalization, its infrastructure is impressive and the country is well placed to benefit from the 2010 World Cup soccer tournament in South Africa. Opportunities exist in the construction of hotels and lodges and in operating tourist facilities.

"The tourism sector will only go from strength to strength. There are generous tax incentives in areas designated as Tourism Development Zones including a 0% tax on the first five years of operation," says Shaun Lightfoot.

The property market, buoyed by the Diaspora, has shown significant growth over the last four years but prices remains relatively cheap when compared with the rest of Africa. Property prices in the traditional tourist strongholds of Victoria Falls and Kariba have remained depressed and should offer good value for investors in the short to medium term as tourism recovers.

Smart investors will also be looking to buy assets that can be sold for a profit once there is some level of stability. "Due to the generally undervalued assets, asset management firms, merchant banks and insurance companies have very good prospects going forward should the current political and policy stability prevail," says Sam Muradzikwa.

It is clear that a wealth of opportunities awaits intrepid investors in Zimbabwe.

Harare  —ECONET says MTN is welcome in Zimbabwe after reports that Africa’s biggest cellular company was keen to invest in the country.
Chief executive officer, Douglas Mboweni told media here that the company always thrives on competition in all the markets it is operating.

Reports have suggested that South Africa’s MTN was interested in investing in Zimbabwe’s mobile phone network industry. Mboweni says Econet is not wary of such developments.

“Econet has always been in a competitive environment wherever it operates. We already have Orascom of Egypt, who have invested in Telecel. MTN were at the Zimbabwe International Trade Fair. In Botswana, we are competing with Orange,” Mboweni told media.

Econet, the biggest cellular network provider in Zimbabwe, operates networks in Lesotho, Botswana, Burundi and Kenya.-

HARARE, June 4 ,2009 - The National Railways of Zimbabwe (NRZ) requires at least USd 100 million dollars to be rehabilitated, a report on the Public Private Partnership (PPPs) compiled by the office of the Deputy Prime Minister Arthur Mutambara has revealed.

"The cost of the project to rehabilitate NRZ resources total is 100 US million dollars. The project involves the repair of 20 mainline locomotives, 20 yard/shunt locomotives, 1500 wagons and the recovery of temporary speed restrictions (cautions) on stretches of the railway track," the report titled Public Private Partnerships for Economic Development in Zimbabwe compiled by Mutambara office says.

The report indicates the country is set to benefit if the railway system which has been neglected for long, is repaired.

The USd 100 million dollars will help NRZ to construct railway lines from Lion's Den to Kafue in Zimbabwe ,while plans are also there to construct a railway link from Mutoko to Moatize,Tete in Mozambique.

Heavy vehicles were being used to transport heavy granite blocks from Mutoko to Harare or Mutare to reach the Beira port and roads are being damaged as a result.

The NRZ has been facing financial difficulties in the past years as transporters of cargo relied mainly on the road link due to the poor service provision by the NRZ.

Passenger trains have also in the past years been charging cheap fares when the country was still using the Zimbabwean dollar, benefiting nothing to the parastatal.

Trains carrying passengers are constantly delayed and at times passengers reach their destinations late due to faults along the railway lines.
The communication equipment is reportedly not working and has caused accidents in the past years, while the staff have relied on mobile phones to communicate.
The report by Mutambara's office aims to resolve infrastructural challenges, boost capacity utilization, drive industrial production, improve public sector performance in-order to improve Zimbabwe's battered economy so as to create employment and stabilize the economy.

The World Bank announced Monday that it will provide Zimbabwe with $22 million grant to help the country rebuild its shattered economy, marking its first such assistance to the impoverished African country since 2000.

World Bank official Toga Gayewea McIntosh said that the grant would be available in the next few weeks, describing the small assistance to Zimbabwe as "a first step."

Acknowledging that the grant that would soon be made available to Zimbabwe was relatively small, McIntosh said that further funds would be released only after Zimbabwe clears its existing arrears.

"This is the first step. This is a nation in arrears, a nation in crisis," McIntosh said told reporters in Harare after his meeting with Zimbabwean Prime Minister Morgan Tsvangirai and Finance Minister Tendai Biti. "The first task is to see how Zimbabwe can get on with debt reduction."

The World Bank assistance comes just after the opposition Movement for Democratic Change (MDC) joined President Robert Mugabe's Zanu PF party in a new power-sharing government in an effort to end the country's political crisis and to pull back the impoverished African country from economic collapse.

In February, MDC leader Morgan Tsvangirai was sworn in as the Prime Minister in Zimbabwe's new unity cabinet, while another MDC leader Tendai Biti was appointed the country's finance minister.
Soon after he took office, Tsvangirai had pledged to normalize ties with international donors and lenders, as most of them had stopped funding Zimbabwe over President Robert Mugabe's economic mismanagement and controversial land reform policies.

The latest World Bank grant is seen as a major victory for Zimbabwe's new unity government as strong ties with the World Bank and International Monetary Fund are vital for rebuilding the country's broken economy.

Moreover, the U.S. and the EU have said that they will restore aid to Zimbabwe only when there is notable evidence of genuine power sharing between the rival parties.

Earlier in March, U.S. President Barack Obama had extended the U.S. sanctions against Zimbabwean President Robert Mugabe's regime for one more year, saying that the political crisis in Zimbabwe remained unresolved and was a "threat" to US policy.

The U.S. sanctions on Zimbabwe, which were introduced six years ago by Former U.S. President George W Bush bans more than 250 Zimbabwean individuals and companies from doing business with the United States.

The International Monetary Fund (IMF) will send a team to Zimbabwe next week to assess the country's tax policy, banking and governance issues, an official said on Thursday.

The IMF technical team, the second delegation from the institution since March, will be in the country from Monday until May 29.

"An IMF delegation will be in the country on Monday next week to assess the country's financial systems," an official close to the delegation told AFP.

"The delegation's visit follows the executive board's decision early this month which approved technical assistance in the areas of tax policy and administration, payments system, lender-of-last-resort operations and banking supervision, central banking governance and accounting."

On May 6, the IMF announced that it had resumed technical assistance to targeted areas in Zimbabwe following consultations with the new unity government in the southern African country.

The board took into account a "significant improvement in Zimbabwe's co-operation on economic policies" to address its problems over arrears, which amounted to 133 million dollars, an IMF statement said after the board meeting.

The official however said "many outstanding issues need to be resolved before the IMF and other multilaterals like the World Bank and the African Development Bank can provide financial assistance to Zimbabwe."

"This is a first step that will start to resolve some of the outstanding issues," he added.

The new government led by Prime Minister Morgan Tsvangirai has made it a priority to restore relations with major international organisations and revive the country's economy.

In February, Tsvangirai joined President Robert Mugabe in a power sharing government.

"The government's forward-looking policy intentions are sound but their success mainly depends on the authorities' ability to sustain political commitment and strengthen technical capacity," an IMF report released this week said.

"Other risks include political tensions within the unity government and unfilled budgetary financing gaps."

The International Monetary Fund announced Wednesday that it has lifted the suspension of Zimbabwe insofar as technical assistance is concerned, clearing the way for IMF experts to help the country in areas such as tax policy and central bank governance.

The decision to resume technical assistance was reached on Monday by the IMF Executive Board, which reviewed the findings of a recent IMF mission to the country.

"Effective from May 4, 2009, IMF technical assistance can be provided to Zimbabwe in the areas of (i) tax policy and administration; (ii) payments systems; (iii) lender-of-last-resort operations and banking supervision; and (iv) central bank governance and accounting," the statement said, identifying the "targeted areas" for such assistance.

An IMF statement said factors influencing the decision included “significant improvement” in Zimbabwe's cooperation on economic policies aimed at resolving its outstanding arrears to the Fund, as well as “severe capacity constraints...that represent a major risk to the implementation of the government's macroeconomic stabilization program."

But it is understood that the IMF will not extend financial aid to Zimbabwe until the country has cleared its arrears on debt payments to all international financial institutions, including the World Bank and the African Development Bank, which total more than US$1.2 billion.

In order to clear those arrears, Zimbabwe will have to secure loans from international donors which means convincing them it is committed to a broad range of reforms.

The IMF described Zimbabwe's short-term economic outlook as “uncertain.”

But it said the short-term recovery program and 2009 budget set down by the national unity government in place since February contain important macro-economic and structural policy commitments that could lay the foundation for a recovery led by the private sector.

However, it cited “significant downside risks” if those policies should be reversed.

JOHANNESBURG – A Dubai state-owned company on Sunday said it was investing in Zimbabwe’s wildlife sector where poaching has been rising as human beings encroached on conservancy areas.

Dubai World said the investment into Zimbabwe’s Bubye Game Reserve was part of its African branch’s plans to boost investment on the continent.

"(Africa) is a place where you can see growth . . . double-digit growth," Dubai World Chairman Sultan Ahmed bin Sulayem told the Arabian Hotel Investment Conference.

"It's virgin and has so much charm and we can add value to it," he said, adding Dubai World was looking at investing in game parks in Zimbabwe and South Africa.

In March Dubai World Africa announced that it had bought three top-end South African wildlife game parks, as part of boosting its exposure to Africa's tourism sector, including investments in hotels and beach resorts.

The investment is welcome relief to Zimbabwe’s troubled wildlife sector after conservationists last week said hundreds of elephants have been forced to migrate across the strife-torn southern African country’s borders, fleeing poachers and human encroachment into wildlife areas.

The Zimbabwe Conservation Task Force (ZCT) said in its latest monthly bulletin about 400 elephants have crossed the Zambezi River into Zambia, Zimbabwe’s northern neighbour, in recent months as people struggling to eke a living in the crisis-torn country “are encroaching more and more into areas previously reserved for wildlife".

Zimbabwe’s tourism sector, at one time one of the three biggest foreign currency earners in the country, is now a shadow of its former self after President Robert Mugabe stepped up violence against political opponents 10 years ago. 

Tourists stayed away from Zimbabwe in their thousands, fearing for their safety and photographic safaris dropped sharply during years of political and economic turmoil since the often violent seizures of thousands of white-owned farms began in 2000, disrupting the agriculture-based economy in the former regional breadbasket.

More than 700 families, with tacit approval from the government, invaded Gonarezhou National Park in the southeastern border with South Africa and Mozambique around 2000 as part of the government’s violent land reforms, putting pressure on the wildlife conservancy.

The formation of a government of national unity by Mugabe and his long time rival Morgan Tsvangirai has raised hopes the political crisis will dissipate and allow the economy to pick up again and with it the tourism sector. 

Prime Minister Tsvangirai has appointed the British-based World Travel Group (WTG) to help spruce up Zimbabwe’s tainted image abroad as part of efforts to revive the country’s once booming tourism sector.

By Bathandwa Mbola

Pretoria - Zimbabwe's new power-sharing government has secured $300 million in budget support from its neighbours to revive the country's economy.

"This grant is aimed at assisting Zimbabwe in some of the critical sectors that require assistance," said Foreign Affairs Director-General Ayanda Ntsaluba, on Tuesday.

He said negotiations between the countries, including South Africa and Botswana, had been wrapped up and now all that was left was for the legal process to be concluded. Botswana alone donated $70 million.

Mr Ntsaluba said the southern Africa region was also finalising the discussions around the credit lines for the country. "It is only a matter of days before it is finalised," he said, declining to divulge how much the credit line would be.

Last week, a delegation from Zimbabwe's unity government visited Washington for meetings aimed at securing funds for the country's reconstruction.

Britain has pledged more than $21 million in humanitarian aid to Zimbabwe, which is estimated to benefit three million people by way of food, seeds and fertilizer

Zimbabwe - The International Monetary Fund (IMF) has urged international donors to give financial support to Zimbabwe, now that the country has formed a coalition government and has a credible economic plan.

In a statement, IMF's Africa Department director Antoinette Sayeh said support was urgently needed in Zimbabwe to underpin an economic recovery process that the new government had started.

After years of wrangling, the government and the opposition in the country formed a coalition administration in February, and immediately began tackling deep-seated economic problems.

"It's (coalition government) the context in which we think there is a window of opportunity in Zimbabwe that is worthy of support by the international community," Sayeh said.

"The actions taken recently...by the government in Zimbabwe are encouraging," she added.

The IMF resumed contacts with Zimbabwe last month after suspending ties for years over economic policy disagreements.

But it has not restored aid to Harare, which the southern African country said it desperately needed to reverse years of economic decline.

World Bank Tribunal Tells Zimbabwe to Pay US$21M to Evicted Dutch Farmers

The international Center for Settlement of Investment Disputes, an arm of the World Bank, has awarded US$21 million in compensation to 13 Dutch farmers whose land in Zimbabwe was expropriated by the Harare government.

Ruling April 22 in the case of Bernardus Henricus Funnekotter and others versus the Republic of Zimbabwe, the tribunal said Harare's bilateral agreement with the Netherlands obliges it to compensate the farmers in full for properties that were seized, including the land.

The Zimbabwean government is on record as saying that it will only compensate farmers who are dispossessed of their land for improvements such roads, buildings and reservoirs.

The previous Zimbabwean government under President Robert Mugabe brushed off a similar ruling by a tribunal of the Southern African Development Community finding for a group of 78 white farmers saying they had been denied due process under the law.

Under the current national unity government, Prime Minister Morgan Tsvangirai and Deputy Prime Minister Arthur Mutambara have argued that such farm takeovers, which Mr. Mugabe has championed, must be halted because they drive away international investors.

Ongoing farm takeovers have thus become a volatile issue for the unity government.

Agricultural expert Mandla Nkomo, a former chairman of the Zimbabwe Farmers Union, told reporter Chris Gande of VOA's Studio 7 for Zimbabwe that in any case even if the Harare government wanted to compensate the Dutch farmers, it lacks the means to do so.

The sale of Zimbabwe's state-owned mobile phone operator NetOne -- a first key test for the new government's massive privatisation plan -- is generating huge interest, the company's CEO told AFP.

"Since September 15, when the power sharing agreement was signed, there has been an increase in inquiries from the UK, Canada, Italy, looking for opportunities," NetOne chief executive Reward Kangai said in an interview.

NetOne is the second biggest operator in the country and competes with two privately owned companies for the Zimbabwe market, which has only 1.4 million mobile phone users but is seen as having strong potential for growth.

The sale is part of a broader effort to bring in much-needed funds for an economy riven by hyperinflation, political strife and disease. State assets in the oil sector, air transport and railways are also planned for privatisation.

The unity government, which only took office this February following disputed elections in March 2008, says it needs more than 8.5 billion dollars (6.4 billion euros) over three years to haul the country out of economic ruin.

A regional bloc has pledged to help, but international donors are reluctant to release funds until they see the uneasy power sharing deal between long-time rivals President Robert Mugabe and Prime Minister Morgan Tsvangirai in action.

The new cabinet has already made major moves towards economic reform, unveiling a recovery plan that slashed price controls, eased import restrictions and made the South African rand the currency of reference.

In March, new Finance Minister Tendai Biti presented a revised budget to parliament, updating the one unveiled in January by Mugabe's cabinet.

His new estimates showed that government revenue would be one billion dollars, down from the 1.7 billion dollars projected in the January budget.

Biti has also suggested the government must sell parts of state-owned entities like the National Oil Company of Zimbabwe, national carrier Air Zimbabwe and the rail company although no concrete plan has yet been approved.

"Selling state owned assets will send a right signal to investors, but it is better to get a correct value of those assets before disposing of them," said Best Doroh, chief economist at local investment group ZB Holdings.

In the interview with AFP, NetOne's Kangai did not reveal the names of the firms interested in buying the company but said they were already present "in a number of African countries" and promised maximum transparency on the sale.

The Zimbabwe telecommunications industry, like most businesses in the former British colony, has been knocked back by nearly a decade of political turmoil, with crumbling infrastructure and the imposition of crippling state controls.

Industries have been at less than 10 percent of capacity for years.

Kangai said that one reform planned by the government for the telecoms industry was the removal of high tax charges on imported equipment. Telecoms companies are currently taxed up to 60 percent on imported materials.

"We want all Zimbabweans to have broadband, access to other markets. We want to be home away from home and have technical expertise," he continued.

As for the cost, Kangai said NetOne was valued at half a billion dollars three years ago, adding that capital requirements would be 200 million dollars.

The NetOne chief sounded an optimistic note about the economic future of this struggling southern African nation saying: "Zimbabwe is open for business, investors will be able to invest to start operations here at low cost."

Harare — FINANCE Minister Tendai Biti has pushed for amendments to the Reserve Bank of Zimbabwe Act which will put an end to quasi-fiscal operations blamed for fuelling inflation.

Biti has not hidden his dislike for Gono whom he blames for inflation that spiralled out of control before the use of multi-currencies.

Sources said Biti made his proposals to the cabinet last week where he also announced he wanted an audit carried out on the RBZ books.

Before his presentation, The Standard is informed the Ministerial Economic Committee had agreed to have the amendments, which would reduce some of the powers wielded by the RBZ Governor.

The committee however cautioned that the amendments should not be undertaken in such a manner that the bank would become so subservient to the Minister, and rendered ineffective.

The proposed amendments, sources said, would outlaw any quasi-fiscal operations that saw Gono dishing out tractors, scotch carts, food hampers and vehicles.Under the proposed amendments, the RBZ would concentrate on its core business: matters concerned with banking, currencies, monetary policy and the supervision of the financial services sector.

Parliament would also have an oversight role on the activities of the bank, which would require approval for borrowing money.

Biti told cabinet that amendments to the RBZ Act were necessary in view of the fact that the operations of the bank had been cited as one of the critical areas that needed attention.

The observation was made by a joint mission comprising the IMF, World Bank and African Development Bank that visited Zimbabwe between March 9 -24.

The team was in Zimbabwe as part of Article IV consultations.

It also called for the appointment of five non-executive members to the Reserve Bank Board.

The joint team also called for an audit on the Civil Service payroll, at one time suggesting that outsiders come to audit it. The proposal was thrown out on the basis there were firms in Zimbabwe which could do the job.

Biti is in Washington where he is attending the Annual World Bank and International Monetary Fund Spring Meetings.

A £15m package to help the people of Zimbabwe was announced by International Development Secretary Douglas Alexander today.

This critical humanitarian aid will mean increased support for the country’s health system, greater access to clean water and more support for struggling farmers in Zimbabwe.

The package will help address a number of urgent priorities identified by Zimbabwe’s new Inclusive Government and builds on existing UK support, which amounted to £49m last year.

This UK assistance will help to:

* strengthen distribution systems for front-line health clinics with improved access to life-saving medication and basic health care for vulnerable people;
* improve capacity to respond to future health epidemics;
* reduce the likelihood of large-scale cholera outbreaks in the future by ensuring greater access to clean water;
* improve the supply and availability of food for up to 3 million people by providing seeds and fertilizer, and boosting smallholder farming, thereby reducing reliance on emergency food aid;
* support the welfare of people who have been forced to leave their homes;
* strengthen the capacity of national systems which provide essential basic services.

International Development Secretary Douglas Alexander said:

“The welfare of the people of Zimbabwe remains a major concern, with the humanitarian situation continuing to cause great hardship for millions.

“The creation of a more inclusive Government represents a real opportunity for much-needed change. We welcome efforts by the new Government to deliver economic, social and political reform. Credible progress will attract increasing support from donors and other partners to tackle the root causes of Zimbabwe’s problems.

“The UK remains committed to providing humanitarian support, which is why I am announcing £15m in additional assistance to ensure that people have food to eat, and access to life-saving health services.”

JOHANNESBURG/LONDON - Gold producers are re-starting shut mines in Zimbabwe after new rules allowed them to sell gold directly on world markets, but uncertainty is likely to block big new mine investments for years.

The rush to re-open mines comes at a time when Zimbabwe's unity government of President Robert Mugabe and Morgan Tsvangirai is seeking to repair a tattered economy, but investors are holding out for major reforms.

The global credit crunch has also dried up cash for investment, and even once this hurdle is crossed, Zimbabwe is unlikely to see new cash flowing its way immediately.

"It's going to take a long time to build people's confidence to invest in the country," said analyst Cailey Barker at RBC Capital Markets in London.

"In terms of a big rush into the country, I think there are far better opportunities in other countries that people are not even doing because of the rest of the problems with debt and capital markets."

A key stumbling block to mining investment in Zimbabwe -- which has the world's second-biggest platinum reserves and hefty deposits of diamonds, coal and nickel -- is a law limiting foreign ownership of mines to 49 percent.

Gold producers already in the country have jumped at the opportunity presented by the central bank, which in February relinquished its role as sales agent for gold, allowing firms for the first time to sell the metal and keep all the proceeds.

This is a far cry from the previous scenario where they got 40 percent of proceeds in Zimbabwean dollars, a currency made worthless by hyper-inflation.

Zimbabwe's central bank, which owes gold miners millions of dollars, plans to repay this in special foreign currency bonds.

A wave of gold firms that had shut down mines leading to near halt in output are now seeking funds to resume business. They had shut their mines in the face of sharply rising costs, frequent power cuts, equipment and foreign currency shortages.

The country's biggest gold producer, Metallon Gold, London-listed Mwana Africa and Canada's New Dawn Mining Corp are all planning to re-open their gold mines within months.

"Gold producers there were scraping the bottom of the barrel in terms of profits," Johannesburg-based gold analyst David Davis of Cr edit Suisse Standard Securities said.

"If the rules are relaxed even further, we could see more exploration of gold, platinum and so on, and this is what hasn't happened yet."

Analysts said opportunities in Zimbabwe at the moment were mainly for those already established in the country.

Chief Executive David Brown of the world's No. 2 platinum producer Implats, which has the biggest mining investments in Zimbabwe, has vowed to pump more cash into the country only if the political and economic situation improves.

Brown met Mugabe this month in Harare and invited him to the launch of Implats' $340 million mine expansions in the country.

A new rule revoking a special concession that allowed platinum and diamond miners to keep offshore foreign currency accounts, has also caused uncertainty.

The miners must now keep such accounts with local banks. But so far this rule has not deterred some key players.

"We have had support from government and we are definitely not planning to wind up business in Zimbabwe," Brown said.

Rival Anglo Platinum, the biggest in the sector, is also forging ahead with its planned 150,000-ounce a year platinum project in the country.

Business hopes Tsvangirai's faction of the government can change the laws which limit foreign ownership to 49 percent as it had promised during Zimbabwe's elections.

"It doesn't appear as though they are willing to use their parliamentary majority to repeal this legislation," economic analyst John Robertson said, referring to Tsvangirai's party.

But Zimbabwe's wealth of mineral resources could attract some daring investors, analyst Nick Hatch at ING in London said.

"If you are prepared to take a long-term view and you don't bet every dollar in your portfolio, then it makes sense to buy in Zimbabwe," he said.

Such investors were keeping Zimbabwe in their sights.

"We have definitely seen an increase in conversation around Zimbabwe," said Thys Terblanche, London-based head of mining and metals at South Africa's Standard Bank,

"Now with the relaxing of the regulations, the hope certainly is that when equity markets return, when banks start lending again and there are more funding resources available, a lot of it will go into Zimbabwe."

By Our Correspondent

HARARE - Gideon Gono, the governor of the Reserve Bank of Zimbabwe (RBZ), has dismissed outright suggestions that he was the de facto Prime Minister of Zimbabwe prior to the establishment of the inclusive government.

He suggested instead that the sweeping powers he wielded were bestowed on him under the provisions of the RBZ Act.

He also insisted that he was taking instructions from his principal, President Robert Mugabe, as he implemented policies that have wrecked Zimbabwe’s dramatic economic ruin.

His explanation to parliamentarians Thursday, when he came out all guns blazing, betrayed his determination to hold onto his job amid mounting clamour for the removal of a man who in his heyday became more powerful than government ministers.

As pressure for Gono’s removal has mounted with the collapse of the economy, he has in turn blamed sanctions, banks, the Zimbabwe Stock Exchange, black-market currency dealers as well as insurance companies for wreaking havoc on the economy. As well as firing bankers, he has blacklisted more than 20 investment companies and frozen their accounts.

On Thursday he told legislators in Harare that Section 6 (g) of the RBZ Act empowered him to act as a banker, financial adviser and a fiscal agent of the State.

It was an apparent feeble attempt to justify his rapacious minting of cash to bankroll Mugabe and Zanu-PF’s profligate spending. He also cited Section 6 (l), which empowers the Reserve Bank to exercise any functions conferred or imposed upon it in terms of the enactment.

The embattled governor also sought refuge for some of his more questionable policies in Section 8 (2) of the RBZ Act which states that “nothing in this section shall prevent the State from carrying on transactions in such manner as the State may require and, if so requested by the State, the Bank shall make the necessary arrangements to this end”.

He shifted blame to Mugabe and said he was working under instructions from him as his principal. He claimed to have engaged in non-traditional roles of a central bank because of declining capital flows, droughts, declining capacity utilisation, limited fiscal resources, political polarisation, sanctions and a failure to access balance of payments support.

“People forget what they legislated,” Gono said. “You said to me, ‘Ita zvese zvese as long as takuti ita.’ (Do whatever as long as we have instructed you to do so). So that is what I have been doing. You don’t shoot the messenger.”

Gono is blamed by economists and the IMF for compounding Zimbabwe’s crisis through quasi-fiscal activities that have seen the RBZ pump millions into financing newly resettled black farmers, most of them Zanu-PF supporters and who have failed to produce enough food to feed the starving nation.

For example, Gono provided foreign currency to purchase combine harvesters, tractors, motorcycles, generators and small farming implements that were handed for free to resettled farmers by Mugabe just before elections last March, in what analysts said was a clear attempt by the Zimbabwean leader, working in cahoots with Gono to curry favour with a disgruntled electorate.

Mugabe and Zanu-PF still lost the election.

Gono told parliamentarians: “All that we did was, however, authorised, transparently reported upon at different platforms and appreciated by all beneficiaries, including by those who today hold different views in public.”

Economists say Gono’s sacking is a necessary prelude before any aid is released, and major donor countries, including the G20 group of richest countries and the US have recently said the central bank chief’s removal was one of the key indices of whether Zimbabwe was a fit recipient of aid.

A statement issued on March 20 after a meeting in Washington DC of the G20 bloc, which again met in London yesterday to consider Zimbabwe’s US$8billion rescue package request, urged the inclusive government to “take additional steps to demonstrate its commitment to reform such as … the establishment of a credible and transparent central bank team.”

Britain’s Africa minister Lord Malloch-Brown has also called for the dismissal of Gono before the country could be eligible for budgetary support. He said he did not trust the people who signed the cheques at the central bank.

Gono has failed to account for US$7.3 million donated last year by the Global Fund to Fight AIDS, TB and Malaria to buy medicines for Zimbabweans living with the HIV virus.

Prime Minister Morgan Tsvangirai and Deputy Prime Minister Arthur Mutambara have insisted that Gono must be fired, but Mugabe has refused to budge. Analysts believe Gono, 49, has played a central role in the collapse of Zimbabwe’s economy.

Gono has played a key role in fundraising for Mugabe’s Zanu-PF party by minting cash. As recently as February 2, the central bank knocked 12 zeroes off the local currency and introduced seven new notes.

Gono’s policies have been one of the main drivers of the country’s hyperinflation, which for the first time in a decade started registering deflation this month following dollarisation of the economy by the new administration, whose Finance minister Tendai Biti has ring-fenced Gono to his core business.

Gono - who started his working life as an office orderly but spectacularly rose through the ranks to reach the pinnacle of Zimbabwe’s banking sector - was first appointed central bank governor in December 2003 as a turnaround strategist after successfully salvaging the fortunes of the once struggling bank, Commercial Bank of Zimbabwe (CBZ).

The government, a shareholder in the bank was a catalyst in the much hyped turn-around success story. University students’ payouts as well as the salaries of the police and military were disbursed through the Jewel Bank, as it came to be known. Government officials obtained unsecured loans from the bank, which some did not pay back. That became the foundation of Gono’s rise to power.

He was reappointed to a fresh five-year term in December last year amid fierce resistance from the MDC leaders who insisted that his reappointment by Mugabe without consultation with the other two principals was in contemptuous violation of the power-sharing agreement.

Mutambara told business leaders at the Harare Chamber of Commerce’s post-budget breakfast meeting last week that discussions over replacing Gono were still ongoing, despite President Mugabe’s utterances that debate on that matter was closed.

Hope that foreign aid would be released again to help the country recover from its current economic chaos was one of the most powerful pressures that forced Mugabe finally to agree to share power with Tsvangirai.

According to one diplomat, Gono has little credibilityand, while the international community has offered billions in aid to a reforming Zimbabwe, it is essential that the power-sharing agreement is seen to be working.

Western governments say openly that they see Gono’s removal as one of the conditions for resuming full financial support for Zimbabwe’s power-sharing government.

Current indications are that Mugabe is unlikely to yield.

HARARE, April 2  - An international diamond group called on Thursday for a ban on trade in Zimbabwe diamonds, suggesting proceeds had been used to fund human rights violations by President Robert Mugabe's government.

The call by the World Federation of Diamond Bourses follows a similar one by the European Union (EU), which in January urged the Kimberley Process -- an international certification scheme to ensure that diamonds do not fund conflict -- to probe Zimbabwe's diamond trade.

The EU expressed concern that the trade in illicit diamonds provided financial support to the Mugabe government, a charge Harare has denied.

"The WFDB and its membership worldwide are committed to do all it can to prevent conflict diamonds from Zimbabwe or from any other source for that matter to be traded by our members," WFDB president Avi Paz said in a statement.

There was no immediate comment from the Zimbabwe government.

The World Diamond Council has put Zimbabwe's production of rough diamonds at 0.4 percent of world output, mostly exported with Kimberley Process certificates.

Harare, Zimbabwe - In the clearest sign yet that international donors were again loosening the purse for Zimbabwe, the World Bank and Denmark on Monday announced a combined donation of US$18.7 mi llion to the country to help it grapple with its social and economic challenges.

Also on Monday, the leaders of the Southern African Development Community (SADC) were meeting in Swaziland to raise a US$2 billion aid package for Zimbabwe, to help it repair its battered economy.

After carrying out separate fact-finding missions to Zimbabwe two weeks ago, Denmark and the World Bank said they would provide the country with US$18.7 million, much of it devoted to providing clean and safe wat er for the capital, Harare.

The African Development Bank (AfDB) said it would chip in with Euro 2 million for the same purpose.

Zimbabwe was hit by a devastating cholera outbreak at the beginning of the year, which was widely blamed on use of unclean water.

Much of the water purification and pumping infrastructure in urban areas in Zimbabwe has broken down, leaving most households without clean water.

More than 4,000 people died in the cholera outbreak, while close to 100,000 others were infected.

Denmark and the World Bank said most of the funds would be spent on water infrastructure in Harare, a city of more than four million people which is hardest hit by the water shortages.

International donors are again warming up to Zimbabwe after President Robert Mugabe agreed to form a coalition government including the opposition last month.

This has seen a flurry of donors coming to the country, including missions from the International Monetary Fund, the World Bank, the AfDB and other agencies.

Australia and Sweden were the first countries to resume aid to Zimbabwe, each giving the southern African country US$10 million.

South Africa could experience a “commercial boom” if trade with Zimbabwe was increased, Zimbabwean Economic Planning and Development Minister Elton Mangoma said on Monday.

Mangoma urged South African companies to recapitalise and extend some loans to their Zimbabwe affiliates.

Once Zimbabwean companies could access South African products and services more easily, demand for South African-produced goods would rise, boosting the local economy.

Speaking at a conference hosted by international tax and advisory firm KPMG, Mangoma said that the Zimbabwean government had little funds to invest in its own country. It would now be up to the private sector to restart the Zimbabwean economy.

He added that the government’s view on the private sector would have to change, and that tax and operating conditions within Zimbabwe would have to be made more appealing to investors. “As Ministers of the government, we will have to mingle a lot more with businesses, consult them a lot more meaningfully, and make sure that if they have any concerns, that these concerns are dealt with.”

Mangoma noted that less than 10% of Zimbabwe’s manufacturing capacity was currently being used, and if government wanted to increase that to 60% by December, it would need to attract foreign investment.

To do so, government would have to look at issues of electricity availability. “Right now, our generating capacity is less than 40%, and yet for an investment of less than $100-million, we can get our capacity to over 80%. We are taking this issue seriously, and we are in discussions with Eskom and other financiers here to make sure that our generation capacity is restored.”

The Zimbabwean government would also have to look at stabilising the agricultural sector, which was previously the country’s biggest source of income. Mangoma noted that fertiliser manufacturers were currently hard at work to produce enough fertiliser, while efforts were being made to procure enough seed to cover all the rural areas.

“As a minimum, Zimbabwe must be food self sufficient by 2010. This does not mean that we will have surplus for feeds, but we will have enough for human consumption.”

He noted that the country would also be focusing on yield, as opposed to boosting the acreage planted.

Zimbabwean Institute of Chartered Accountants president Nyasha Zhou identified several areas in which foreign investment would be most profitable. These included agriculture, mining, manufacturing, tourism and infrastructure.

In the case of infrastructure development, Mangoma noted that the government was willing to negotiate concessions, and open up previously prohibited areas to the private sector.

Zhou noted that besides concession opportunities, Zimbabwe was also ripe for equity and debt transactions, joint ventures, franchising, and partnerships. He added that the country had several benefits, which should draw foreign direct investments, including the country’s operational business structures, strategic geographical position, and strong work ethics.

The changing political climate would also offer a more stable environment for investing.

BIO-DIESEL

Zimbabwe was aiming to produce biodiesel from jatropha to substitute about 10% of its imported fuels by 2017, which National Oil Company of Zimbabwe (Noczim) biofuels programme manager Abisai Mushaka said would be about 100-million litres of biodiesel a year.

The company was targeting to eventually plant about 120 000 ha/y of jatropha plantations to produce the biodiesel.

Since December last year, Zimbabwean farmers had planted about 1,5-million jatropha plants a week. Noczim was hoping to double this to about three-million plants a week.

This would equate to about 50 000 ha/y of plantations, which would allow Zimbabwe to reach its 10% target by 2015.

The plantations were mostly being planted in the arid and semiarid regions of the country, mostly on a small-scale basis.

A 35-million litre a year biodiesel plant had been commissioned at the end of 2007 to produce the fuel.

However, Mushaka noted that some key elements were still needed to ensure the sustainability of the programme. The company was hoping to eventually establish large central estates for the planting of crops, as well as a number of smaller processing plants.

THE central bank's quasi-fiscal operations over the past five years opened loopholes for corruption as both public and private interests took advantage of lapses in implementation to enrich themselves.

Gideon Gono, the Reserve Bank of Zimbabwe governor, stitched together a number of facilities to keep the country limping and to bust economic sanctions.

The central bank undertook quasi-fiscal projects and introduced projects such as the Productive Sector Facility, Basic Commodity Supply Side Intervention (Bacossi), Local Authorities Reorientation Programme (LARP), the Farm Mechanisation Programme and the Agricultural Support Enhancement Facility.

Under these programmes, parastatals, local authorities and government departments and ministries relied heavily on the central bank for financial assistance to discharge their statutory mandates.

Many of the operations were abused by corrupt individuals and public officials within and outside the central bank for personal gain.

Several people have been arraigned in court for abusing the RBZ's facilities and at least one central bank divisional boss is on the run.

Other facilities to boost agricultural production like subsidised fuel and inputs were also abused by farmers who sold them on the black market for quick returns.

This month, the Anti-Corruption Commission said it was hunting for the RBZ's Agricultural Mechanisation and Small to Medium Enterprises Support divisional head, Mordecai Masakwa, to explain the recovery of farm equipment and inputs at a church and two houses in Harare.

The equipment and inputs, which include three tractors, 41 tonnes of fertiliser, 30 tonnes of soyabean seed, 11 electricity generators, 10 motorcycles, 50 assorted garden tools, 21 knapsack sprayers and eight cultivators, were allegedly diverted from the Farm Mechanisation Programme.

John Banda, who impersonated a senior police officer, was arrested in connection with the case and has since appeared in court where the state said it suspected that the equipment and inputs were released improperly from Bak Storage in the capital.

Two weeks later, a Harare businessman, Anderson Mwashita -- the managing director of Westgate Investments (Pvt) Ltd -- was found guilty by the High Court of theft by conversion for swindling the RBZ out of more than Z$1,5 billion in 2005 that was earmarked to buy two tractors and a CAT grader for Chegutu Municipality.

Mwashita was fined Z$450 000 and ordered to pay US$91 762 as restitution to the central bank.

His company had won a tender to supply the tractors and graders to the municipality at a cost of Z$2,2 billion to be paid by the RBZ, which deposited Z$1,5 billion -- 70 % of the contract price -- into the firm's account.

Mwashita failed to deliver the tractors and grader and could also not refund the central bank.

Besides the abuse of the Farm Mechanisation Programme and the LARP, the RBZ's Bacossi and vehicle acquisition schemes also fell prey to corruption.

The Bacossi programme was introduced by the central bank in July 2008 to sell basic commodities in the form of food hampers to the public at affordable prices.

Former radio and television personality Tichafa Matambanadzo and his business partner Raymond Chamba were recently hauled before the courts on allegations of defrauding the central bank of Z$150 140 which was meant to buy food hampers under Bacossi.

Matambanadzo and Chamba's company, Subvented Solutions (Pvt) Ltd, were approached by the RBZ in November last year and contracted to supply 1 151 food hampers comprising salt, maize-meal, laundry soap, candles, petroleum jelly, toothpaste, bath soap and margarine.

The RBZ transferred Z$150 140 into the firm's account and later advised the company to cancel the order and reimburse the money on the grounds that the central bank no longer required the goods.

Matambanadzo and Chamba allegedly did not comply and withdrew the money for personal use.

The duo is on US$500 bail each and will appear in court on Tuesday for further remand.

Questions have been asked why the RBZ had approached the two's company instead of manufacturers of the goods it wanted.

The central bank's vehicle acquisition facility to benefit parastatals, government departments and ministries to alleviate their transport blues was also abused by public officials.

A senior official in the Media, Information and Publicity ministry is on the run after he was implicated in a scandal where the RBZ vehicles were sold using fake registration papers.

Clyde November, the acting director of finance, human resources and transport in the ministry, is also wanted by police for his alleged role in the sale of the cars.

His accomplices, Isaac Chigumadzi (34), employed as a driver and Blessing Mphawanyera (21), who is a freelance salesperson, were convicted last week by Harare regional magistrate Stephen Musona on two counts of stealing two vehicles valued at US$29 000.

Between February 12 and 16, 2008 the RBZ handed over 79 various cars to the ministry.

In April last year, the two who were accused of acting in cahoots with November and went to Production Services in Harare where they drove away with a Mazda B1800 valued at US$17 000, which they sold to Francis Dewe Mutyavaviri for US$8 500.

Two months later, the trio went to the ministry's parking area at Munhumutapa Building, where they drove off with a Mazda BT 50 worth US$12 000.

They sold the car for US$8 000.

Mphawanyera is also facing charges of stealing three more vehicles valued at US$54 000 belonging to the same ministry.

Several other RBZ vehicles are reportedly not accounted for.

The introduction of quasi-fiscal operations by the central bank was largely blamed for hyperinflation in the country. Gono defended the move arguing that these were extraordinary measures meant to address extraordinary circumstances and realities on the ground.

Gono said this position would be confirmed by the bank's external auditors as part of their due-diligence of the central bank's financial records.

He said the operations were embarked on as survival interventions in the national interest.

But multilateral financial institutions like the International Monetary Fund and the World Bank said the quasi-fiscal activities had interfered with monetary management and the independence and credibility of the RBZ. The institution estimated that losses from the activities had in 2006 alone amounted to about 75% of the gross domestic product because they were financed by money printing or issuing RBZ securities.

Soon after President Robert Mugabe re-appointed Gono to serve a second term at the helm of the central bank, the former CBZ chief executive officer said the RBZ would cease quasi-fiscal operations and concentrate on its main function of inflation control and financial sector stability with effect from January 2009.

He said: "As I accept this extended call of national duty, I pledge to maintain a very tight monetary policy stance, anchored on the comprehensive realignment and streamlining of the Reserve Bank's functions in a manner that leaves monetary authorities with the core responsibilities of inflation-targeting, management of the national payments systems and safeguarding financial-sector stability."

Gono said under the thrust, the central bank would establish a stand-alone, self-funding and well-capitalised developmental institution to manage "all the work-in progress" under the previous quasi-fiscal desks of the bank, as well as meeting other developmental programmes as they arise.

"I also wish to take this opportunity to once again re-affirm the bank's position and assurances to stakeholders that all the bank's quasi-fiscal outlays since December 1, 2003 have been fully amortised such that there will be absolutely no penny to be transferred as a burden on the fiscus, and hence the taxpayers," he said.

Gono said this position would be confirmed by the bank's external auditors as part of their due-diligence of the central bank's financial records.

Harare — FINANCE Minister Tendai Biti has directed the Zimbabwe Revenue Authority (ZIMRA) to enforce tax laws and ad hoc tax remittance measures, including seizing the assets of tax evaders and auctioning them to recover lost revenue and forestall future defaults.

In his budget review speech on Wednesday last week, which slashed the revenue and expenditure estimates for the year by approximately half, the Finance Minister revised the Finance Bill and added a clause providing for the seizure and auctioning of the assets of tax offenders.

This applies to all tax laws such as the VAT Act, the Income Tax Act, the Customs Duty Act and many others, including the quarterly presumptive tax law covering informal-sector business entities such as hair salons, driving schools, commuter transport operators, haulage truckers and taxi operators.

Tax expert, Tendai Mavhima, warned that the directive could actually result in asset seizures, prosecutions and imprisonment of offenders given the tightening of remittance periods for various tax heads, especially Value Added Tax (VAT).

"There are many tax laws that were not being implemented," Mavhima said.

"All tax laws in Zimbabwe have a section dealing with offenses and penalties regarding tax evasion. If one is convicted of a level 12 offense, he/she could actually be fined heavily or imprisoned for a period of up to two years or be fined and imprisoned at the same time.

"If the penalties are implemented fully, we may actually see property being seized and tax offenders being imprisoned. Remember our Finance Minister has a legal background."

Chapter 23:12 of the VAT Act defines a tax evasion as inaccurately completing tax returns; giving false answers either in writing of verbally when asked by the Commissioner General; maintain or preparing false books of accounts; fraud involving false claims to avoid paying tax; issuing false tax invoices for the purpose of claiming high input tax; issuing tax invoices; debit or credit notes knowing fully well that the information is inaccurate, and many others.

The VAT Act categorises all these offenses as level 12 offenses that attract a fine of US$2,000 or imprisonment for a period of up to two years or "both such fine or such imprisonment." Level 14 offences attract a fine as high as US$5,000.

Mavhima cautioned that the accelerated tax reporting period has put companies at the risk of prosecution as the chance of inaccuracy has also increased. Government introduced accelerated remittance periods for VAT, Pay as You Earn (PAYE) and Capital Gains Withholding Tax on January 30, but backdated them to January 1.

The remittance period for PAYE and Capital Gains Withholding Tax was collapsed to the third of the following month effectively cutting the remittance periods from within 15 days of paying a salary and from within 30 days of receipting the proceeds from the sale of immovable property, respectively.

VAT remittance period has been changed more than once this year, from the traditional 30-90 days to the fifteenth for mid-month tax returns and to the third of the following month for tax returns covering the whole month.

The revised Finance Bill last week moved the VAT reporting period from the third of the following month to the fifth but did not alter the provisional remittance date of the fifteenth of every month.

Effectively, says Mavhima, companies are now obliged to pay VAT twice in one month, on the fifteenth for total invoice sales from the first up to the fourteenth and on the fifth of the ensuing month for total invoice sales for the whole month.

This has not only undermined voluntary compliance with tax laws, but also inverted the role of businesses from being agents of state to financiers of the state since VAT returns are based on invoices, not actual receipts.

The government claims that it has reviewed the tax remittance periods only as an ad hoc measure with the aim of minimizing the "loss of value of revenue remitted to the fiscus" in the wake of hyperinflation, implying that it was not legislating in foreign currency.

But, legally, the measure has had a blanket effect as it does not exempt other currencies in which tax is exacted.

Harare companies interviewed by this paper said the new measure has created administrative problems as the provisional mid-month payment date, which obliges them to remit VAT a day after invoicing or receipting it, effectively reduced businesses to government tax clerks. They also confirmed that ZIMRA has already started doing spot checks - sometimes lasting a week - whereby officials from the revenue collecting agency call on every company listed in their database to peruse through invoices, receipts and other accounting records checking if tax records are up to date.

"They don't show any hurry at all," Sally Makurumidze, a Harare businesswoman said.

"They will patiently go through the invoices and receipts with you checking every transaction to check if the value of VAT you paid is what you actually collected from every 'VATABLE' sale.

"If your business was licensed as a foreign currency licensed warehouses and shops (FOLIWAS), they will also check to see if you were remitting all the taxes, from VAT, PAYE to Corporate Tax, in foreign currency."

Earlier this year, ZIMRA ordered the closure of some businesses, which it accused of prejudicing the government of millions of United States dollars in unremitted taxes after they failed to pay arrears and a penalty of 80 percent. Both the arrears and the fine must be paid on the spot after a conviction is effected.

"In terms of Zimbabwe's laws, it is lawful for ZIMRA to lock up a shop if it has defaulted," Mavhima said.

Except for corporate tax and capital gains withholding tax, technically, all other taxes do not constitute a cost to a company. For instance, VAT, charged on goods and services at every stage across the value chain is a tax on consumers, which business enterprises collect on behalf of the government.

PAYE is also deducted from an employee's income by an employer acting on behalf of the government. Legally, non-remittance of both taxes constitutes fraud.

TORONTO, Mar 27, 2009  ----New Dawn Mining Corp. (TSX: ND: undefined, undefined, undefined%) is providing an update to report further positive economic policy changes in Zimbabwe as outlined in the Short Term Emergency Recovery Program ("STERP") recently presented by the new Minister of Finance. The new STERP is expected to have a direct positive impact on the Company's Turk Mine, as well as positive effects for the Zimbabwe economy as a whole.

Specific to New Dawn and the Zimbabwe mining industry, the new STERP eliminates any retention on revenue derived from export sales. In the January 2009 Monetary Policy Statement, retention was reduced to 7.5% from 15%. Now, under the new program, it has been eliminated completely. The result is to allow gold producers to continue to market their gold directly and to now retain 100% of the proceeds from such gold sales in foreign currency. At the same time, the STERP proposes to review taxation and royalty structures to bring them in line with international standards.

The STERP also confirms that the new liberalized exchange controls will remain, which will result in New Dawn receiving payment for its gold sales in US dollars, thus eliminating any currency risk.

Additionally, the STERP maintains the previous threshold that any business transaction under US$5M, including the sale of gold, does not need Reserve Bank of Zimbabwe approval. For New Dawn, this permits flexibility for future gold sales and further demonstrates the extent of the positive changes that are now occurring with respect to Zimbabwe's economic policies.

The STERP also includes expediting amendments to the Mines and Minerals Act, particularly in respect to the framework for mining rights, with a view toward reviewing the mining title system, discouraging hoarding of claims which are not being worked, and reforming the Mining Affairs Board.

"Positive changes in economic policy in Zimbabwe are occurring. The new STERP provides us even further confidence and evidence of the positive steps forward being taken by the government towards ensuring economic stability," said Company President and CEO Ian R. Saunders. "For New Dawn, the STERP provides us greater visibility as we move closer to resuming full-scale gold mining operations and begin to generate free cash flow in US dollars, from our export sales of gold mined at our Zimbabwe operations."

New Dawn anticipates moving into full-scale mining operations at the Turk Mine in Zimbabwe during the second calendar quarter of 2009, and expects to report to shareholders in this regard in the near future.

About New Dawn ...

New Dawn Mining Corp. is a junior gold company concentrating its efforts in southern Africa. The Company is well established there with three mines, two production facilities, a skilled and experienced workforce and significant resources.

Two recent NI 43-101 reports documented an aggregate of 969,546 ounces of gold reserves and resources grading between 2.9-6.1 g/t, with additional inferred mineral resources of 355,873 ounces of gold grading between 3.90 - 5.91 g/t. Reserves and Resources are based upon a 2.45 g/t cut-off and US$875/oz gold price at the Turk and Angelus Mines and a 2.0 g/t cut-off at US$750/oz gold price at the Company's Blue Dot Property. For further information on the Company's gold reserves and resources, visit the Company's website at www.newdawnmining.com or filed on SEDAR at www.sedar.com .

New Dawn wholly owns the Turk and Angelus Mines in the upper southwest area of Zimbabwe, with a production facility currently capable of processing up to 400 tonnes per day or 12,000 tonnes per month; and owns a 74% interest in the Blue Dot Property in South Africa, with a production facility there rated at 180 tonnes per day or 5,500 tonnes per month. The Company maintains a highly experienced work force of over 800 people.

The Company has additional assets that form a portfolio of exploration properties, and include the Consolidated Bubi Gold Fields, consolidated Midlands Gold Fields and consolidated Shurugwi Gold Fields properties, all of which are located in Zimbabwe.

The TSX has not reviewed and does not accept responsibility for the adequacy or the accuracy of this release. Statements in this press release regarding the Company's business which are not historical facts are "forward-looking statements" that involve risks and uncertainties, such as estimates and statements that describe the Company's future plans, objectives or goals, including words to the effect that the Company or management expects a stated condition or result to occur. Since forward-looking statements address future events and conditions, by their very nature, they involve inherent risks and uncertainties. Actual results in each case could differ materially from those currently anticipated in such statements.

The contents of this news release were supervised and reviewed by Ian R. Saunders, B.Sc., who is President, Chief Executive Officer, and a Director of New Dawn Mining Corp., and who is a Qualified Person within the meaning of NI 43-101.

FRASER MPOFU
Correspondent

HARARE - Pan-African hotel group, Cresta Hospitality has budgeted $7 million to refurbish its facilities and build additional rooms.

HARARE, Zimbabwe -- Zimbabwe will get no financial assistance from the International Monetary Fund until it moves ahead with sound policies and settles its outstanding debt, the IMF said Wednesday.

The Zimbabwean government had been hoping the international financial organization would be willing to resume aid now that the country has established a coalition government and brought some stability to its economy.

But at the end of a 15-day visit to the country, an IMF team issued a statement saying "technical and financial assistance from the IMF will depend on establishing a track record of sound policy implementation, donor support, and a resolution of overdue financial obligations to official creditors, including the IMF."

It noted, however, that "IMF staff stand ready to continue to assist the authorities through policy advice."

The ability to gain support from international donors was one thing the Zimbabwean government had been hoping a good report from the IMF would facilitate.

Last month, Morgan Tsvangirai, the former opposition leader and new prime minister, said the country needs about $5 billion to kick-start the economy, of which $2 billion is required immediately.

President Robert Mugabe last Thursday pleaded for international aid as he announced the Short Term Emergency Recovery Plan, which his finance minister said would attempt to persuade businesses to gear up, increasing factory utilization to levels above 60 percent.

He also appealed to the European Union and the United States to remove targeted sanctions imposed against him and his close associates in response to his policies, including his policy of taking farms from white commercial owners.

Mugabe recently said that he planned to continue that policy, which has been in effect since 2000. Many analysts blame the policy for the country's food shortages and economic meltdown because the land was given to inexperienced farmers whose prime qualification was being loyal to Mugabe's ZANU-PF party.

Zimbabwe's economic crisis has stretched for months. Its inflation rate became the highest in the world last year, fueled by acute shortages of all essentials, including food, fuel and electricity. The IMF report added that "the Reserve Bank of Zimbabwe's (RBZ) quasi-fiscal activities" also were a factor behind the hyperinflation that brought down the nation's economy.

That inflation has been under control since the country abandoned its worthless legal tender earlier this year and began using the U.S. dollar, the British pound and the South African rand. The IMF report noted that move had strengthened Zimbabwe's position.

But further steps are needed, it said.

The IMF team noted that the humanitarian situation in the country suffered "significant deterioration" last year, in part as a result of "the steep decline in economic activity and public services."

"Poverty and unemployment have risen sharply," it said.

Estimates earlier this month put the unemployment rate at 94 percent, and the United Nations said more than half the population was facing starvation.

A cholera outbreak that began in August has claimed more than 4,000 lives, according to the World Health Organization, which said Monday that although there has been a decrease in the number of cases and deaths over the past two months, there remains a chance of the outbreak restarting.

At the start of the IMF team's visit, the organization said its report would probably be discussed by the IMF's executive board in early May.

Private Zimbabwean economic commentator John Robertson said at that time that he saw little hope of the nation getting IMF funding.

"As long as we do not change our policies, no cent will come from the IMF -- even if they are to come here every day," he said. "No institute would pour funding where there is no rule of law or a sound economic policy."

Zimbabwe Consumer Prices Declined 3.1% in February

March 24 (Bloomberg) -- Zimbabwean consumer prices fell for the second consecutive month in February, dropping 3.1 percent, indicating the central bank is beginning to bring the world’s highest inflation rate under control.

The decline compared with January’s drop of 2.3 percent, Moffat Nyoni, director of the National Statistics Office, said by phone from the capital, Harare today. Annual inflation has not been calculated since it reached 231 million percent in July.

“Inflation has dropped enormously since government revalued the Zimbabwe dollar and allowed trade in foreign currency,” Nyoni said. “It hasn’t been possible to estimate the cost of a basket of goods because for much of last year, goods weren’t available.”

Zimbabwe’s central bank this year cut 12 zeroes off its currency, lifted all restrictions on foreign cash withdrawals and allowed Zimbabweans to use multiple currencies for their business transactions.

“Dollarization has slashed costs and a wedge is being driven deeper and harder into the old order,’’ Harare-based economist John Robertson said in a telephone interview. “It could well be that the process is now irreversible.’’

The southern African nation’s economy has contracted every year for a decade under the rule of President Robert Mugabe, who has been in power since 1980. Zimbabwe has an unemployment rate of 94 percent, according to the United Nations, and about 6.9 million of its 11 million people are in need of food aid.

HARARE  — Zimbabwe President Robert Mugabe on Thursday called for foreign aid to revive his nation's shattered economy and urged Washington and Brussels to end "cruel" sanctions on his inner circle.

"I on behalf of the inclusive government and the people of Zimbabwe say, friends of Zimbabwe please come to our aid," Mugabe said at the launch of a new economic recovery plan prepared by the month-old unity government.

"To the European Union and the United States, I appeal for the removal of your sanctions which are inhumane, cruel and unwarranted."

"We also wish to appeal to all those countries which wish us to succeed to support our national endeavour to turn around our economy," he added.

The European Union and the United States maintain a travel ban and asset freeze on Mugabe and his inner circle in protest at controversial elections and alleged human rights abuses by his government.

Although his long-time rival Morgan Tsvangirai became prime minister in a unity government last month, western countries say they will maintain the sanctions until the 85-year-old leader proves he is ready to reform.

Zimbabwe's once-dynamic economy has been crushed by world-record hyperinflation and the collapse of farming, mining and manufacturing.

Finance Minister Tendai Biti, Tsvangirai's top aide, slashed the government budget by nearly half on Wednesday, saying that revenues would be 43 percent lower than predicted just two months ago.

Tsvangirai has asked neighbouring countries for two billion dollars to help jump-start the economy, but has said that a total of five billion dollars would be needed to put the country back on track.

Mugabe did not say how much aid Zimbabwe wanted, as he launched the Short-term Emergency Recovery Progamme (STERP) in a ceremony at a Harare hotel.

"The successful implementation of STERP will indeed require a substantial amount of resources... We hope these will be forthcoming," he said.

Mugabe said that Zimbabwe needed to move away from "divisive and distractive activities and devote ourselves to a constructive and beneficial socio-economic reconstruction programme."

The wide-ranging scheme calls for reviving agriculture, which has been devastated following Mugabe's chaotic land reform programme, as well as mining, manufacturing and tourism.

Mugabe said the programme would involve lifting price controls, which have been blamed for undermining manufacturing as the president tried unsuccessfully to battle inflation by mandating prices below the cost of production.

"We thus envisage a giant step towards economic stabilisation," Mugabe said at the ceremony attended by Biti and other officials from Tsvangirai's Movement for Democratic Change (MDC).

The economic blueprint said that the government would stop measuring inflation in Zimbabwe dollars and use foreign currency instead. No inflation estimate has been published since the last figure of 239 million percent in July.

The local currency, which was being printed in larger denominations every few weeks, has now disappeared from the streets since dollars and rands were legalised in January.

The document said that the switch to foreign currency could bring inflation down to 10 percent by the end of the year.

African Development Bank chief economist Steve Kayizzi-Mugerwa, who attended the presentation, said that the document "showed an attempt to project a unity of purpose" by the new government.

"The five billion dollar bail-out might sound like a lot of money, but it is the right amount for a for a country like Zimbabwe," he said.

Stockholm - The Swedish government pledged 84 million kronor (10 million dollars) in humanitarian aid for Zimbabwe on Thursday, but said it wants to see more reforms in place before it resumes direct aid to the government.

'Sweden is prepared to give more humanitarian aid but a stronger involvement in the country hinges on reforms taking immediate effect and that they have an impact,' International Development Cooperation Minister Gunilla Carlsson said.

About 34 million kronor were to be channelled via the International Red Cross Committee (ICRC) and the remainder via the United Nations and its consolidated appeal, Carlsson added.

The UN appeal funds were to be distributed via various UN agencies including the UN's childrens fund UNICEF, the UN food and agriculture agency FAO as well a non-governmental groups like World Vision, Mercy Corps and Save the Children UK.

The focus of these efforts was on health, water and sanitation as well as small-scale agriculture.

Carlsson repeted earlier calls for the immediate release of all political prisoners and that the rule of law be reinstated as well as 'end to the political violence' and that the freedom of the press be restored.

Sweden has previously welcomed the unity government formed between Morgan Tsvangirai, leader of the Movement for Democratic Change (MDC) and President Robert Mugabe's Zanu-PF, and hoped it 'would provide a step towards resolving the crisis' in the southern African nation.

FORMER Zanu PF MP David Butau, facing fraud charges linked to the Reserve Bank's farm mechanisation programme, has been stripped of his chairmanship and directorship in Dande Capital Holdings, a company in which he is the majority shareholder.

High Court judge Justice Lavender Makoni recently granted an application by the company's chief executive officer, Danisa Mhlanga, and Butau's co-shareholders -- Evison Musanjeya, Wilfred Hlanguyo and Decent Chitsungo -- for the removal of the former legislator from Dande Capital Holdings' board of directors.

Makoni also barred Butau's brother, Grey, from interfering in the running of the company.

In the default judgement, Makoni ruled: "1st Respondent (Butau) forfeited his directorship in Dande Capital Holdings by being absent at the board of directors meeting for a period in excess of six months without permission."

The judge also ruled that Mhlanga, Musanjeya, Hlanguyo and Chitsungo were the legitimate directors of the company.

"The 2nd (Mhlanga), 3rd (Musanjeya), 4th (Hlanguyo) and 5th (Chitsungo) applicants herein are the lawful directors of Dande Capital Holdings and as such have the exclusive mandate to conduct the company's affairs," read Makoni's judgement.

The company was incorporated in 2000 and re-registered in 2002. Its core business is to offer financial advisory services to local, regional and overseas organisations.

The company has seven subsidiaries -- El'e Resources (Pvt) Ltd, Cynthesis Agriculture Pvt) Ltd, Cythensis Cotton (Pvt) Ltd, Tsakare Chickens (Pvt) Ltd, Timbsbury Timbers (Pvt) Ltd, Heldnet Enterprises (Pvt) Ltd and Telequip (Pvt) Ltd.

Sources close to Butau told the Zimbabwe Independent that the former Guruve North lawmaker returned home last week to fight for the chairmanship and directorship of the company and the criminal charges against him.

Butau fled Zimbabwe in December 2007 when police said they intended to question him in connection with dealings in foreign currency on the black market.

He flew to Britain on a six-month tourist visa before later moving to Pretoria, where he was holed up until March 6 this year.

Butau returned home after arrangements with the Attorney-General's office that facilitated travel documents for him after he lost his passport in South Africa.

The state alleges that on October 19 2007, Butau asked a Joseph Manjoro to deposit $562,5 billion into his company, Nyamasoka Farming's CBZ account after having agreed that he would source US$450 000 using a parallel market rate of US$1 to $1 250 000 to purchase tractors from Michigan Tractors of South Africa on behalf of the government.

"After receiving the money, and during the period extending from October 25 to December 19 2007, the accused sourced foreign currency from the parallel market, which foreign currency was never remitted to Joseph Manjoro," read the state outline.

"When he did so, the accused knew very well that he had no exchange control authority to deal in foreign currency thereby contravening the said (Foreign Exchange Control) Act."

The state alleges that after receiving the $562,5 billion and changing it on the parallel market, Butau gave Manjoro a copy of a telegraphic transfer dated October 23 2007 purporting that he had transferred US$450 000 to the credit of Michigan for the purchase of equipment meant for the Farm Mechanisation Programme.

Verifications made by Manjoro with Michigan proved that no funds were deposited by the accused and when asked to clarify the issue, Butau allegedly asked Manjoro to hand him back the copy of the telegraphic transfer.

He then gave Manjoro a copy of cheque number 100146 for 215 000 British pounds drawn upon his HSBC account number 82435063 domiciled at Channel Islands, United Kingdom, to the credit of Michigan South Africa.

The accused caused the cheque to be deposited into Michigan tractors held by Standard Bank of South Africa.

However, the cheque was returned by HSBC Bank late in November 2007 unpaid with the reason "refer to drawer".

The state alleged that Butau issued the cheque even though he knew he had insufficient funds in his account.

As a result of this misrepresentation, the state alleged, government suffered a prejudice of $562 billion and nothing was recovered.

Last week, a Harare magistrate dismissed Butau's bail application on the basis that he may abscond.

His lawyer Charles Chinyama has since appealed to the High Court against the lower court's decision.

South Africa is considering opening lines of credit and other measures to help Zimbabwe recover from an economic crisis and ease its international isolation, the two countries said on Monday.

Senior officials meeting at Victoria Falls in Zimbabwe also discussed other steps such as providing export credit insurance and facilitating trade to support Zimbabwe's new unity government, a joint statement said.

"The two sides exchanged views on political developments in their respective countries. They agreed to work together in Zimbabwe's re-engagement with the international community and in the lobbying for the lifting of economic sanctions...," it said.

Zimbabwe, beset by 90 percent unemployment, hyperinflation and shortages of basic goods, needs Western donors and foreign investors to rescue its economy.

Their help will be conditional on the implementation of fully democratic government and economic reforms, such as reversing plans for nationalisation, by the joint administration of President Robert Mugabe and Prime Minister Morgan Tsvangirai.

South Africa, the continent's biggest economy and a regional diplomatic power, is well placed to secure support for Zimbabwe.

South Africa and Zimbabwe agreed to boost output in mining and taking steps to increase investment in the sector, said the statement.

A new power-sharing government has raised hopes of an end to an economic meltdown in the once prosperous southern African country where inflation was last calculated in mid-2008 at 231 million percent, the world's highest.

Zimbabwe has estimated it needs $1 billion now to get farms, schools and hospitals working, and another $5 billion later to fully rebuild the economy.

Until this week, it seemed as if nothing could shake the determination of Zimbabwe's long time ruler, President Robert Mugabe, to keep his belligerent war with the West going.

Somehow, the prospect of the International Monetary Fund (IMF) writing off Zimbabwe's ballooning foreign debt and resuming balance of payments support has changed that, at least a bit.

As Mugabe cheer-led renewed land grabs at his birthday party two weeks ago and continued to allow farmland to lie fallow, foreign governments' frustration with him was almost equalled by their frustration with the South African presidency, which has pursued a widely discredited policy of quiet diplomacy, preferring engagement with Mugabe rather than isolation.

This has sometimes appeared to work at cross purposes with openly hostile politicians from Britain and the United States, which extended sanctions against Mugabe and his cronies last week for another year.

Now, South Africa seems to hold the key to the resumption of IMF balance of payments support to Zimbabwe. Events of the past two weeks show that South Africa's influence could finally rescue Zimbabwe's moribund economy.

South Africa Finance Minister Trevor Manuel has managed to persuade the IMF to re-engage Zimbabwe and help it emerge from its ten-year-long economic recession. IMF Managing Director Dominique Strauss-Kahn spoke to Manuel last week about the prospects of resuming relations with Zimbabwe and helping to arrest its economic decline.

This week a top level IMF delegation led by Vitaliy Kramarenko arrived in Harare and has held meetings with top officials, including Economic Planning Minister Elton Mangoma, Finance Minister Tendai Biti, Gideon Gono, the Reserve Bank governor.

The IMF team is accompanied by World Bank officials, who deserted Harare in 2006 and will be in Zimbabwe until 24 March. The visit is part of an annual review of IMF member countries to assess economic and financial stability and policies.

The strain in Zimbabwe's ties with the IMF date to 1999, when arguments about the value of the country's currency and its troops in then-Zaire, now the Democratic Republic of Congo, caused the fund to withhold aid. Within a year, the African Development Bank and the World Bank had followed suit.

By 2001, Zimbabwe had stopped paying back all foreign loans. In early 2002, Zimbabwe's arrears with the IMF amounted to more than 100 million US dollars, and the government's own deficit was ballooning.

In 2003, the IMF suspended Zimbabwe's voting rights in the organization.

In 2007, when the Fund started the process of expulsion, Zimbabwe began taking steps to placate it.

Zimbabwe started paying back its debts and undertook a new monetary policy aimed at denting annual inflation and shoring up the shrinking economy. Even though its efforts were in vain, the fund was mollified and decided to delay Zimbabwe's potential expulsion by six months, by which time there were disputed elections involving Mugabe and opposition leader Morgan Tsvangirai, which eventually led to talks to establish an inclusive government.

The new leaders, in particular Tsvangirai, leader of the Movement for Democratic Change (MDC) and now prime minister, and Biti, as the new finance minister tasked with resuscitating the shattered economy, optimistically pushed the view that the IMF should re-engage Zimbabwe to help with balance of payments support so that the inclusive government would have an easier time obtaining aid.

Biti and Tsvangirai met South African president Kgalema Motlanthe and his finance minister on 20 February. The two Zimbabwean leaders pleaded with their Southern African counterparts for South Africa's help and goodwill in re-engaging the international community.

At that meeting, Biti tabled a document containing a two billion US dollar request.

Half would be for "direct on-budget assistance" to get schools, hospitals and farms running. It includes the costs of recurrent expenditure to pay civil servants salaries in foreign exchange; the purchase of drugs, medical equipment and agricultural inputs; and for urgent assistance to the vulnerable and destitute.

The other half would be a "self-liquidating credit line" that would allow wholesalers, retailers and producers to purchase goods using credit.

The document also outlined that full reconstruction would cost about five billion dollars and would require IMF backing, which Biti argued could help convince sceptical western governments to provide much needed financial assistance and other support.

Manuel, with his status and influence with institutions like the IMF and World Bank, was asked to spearhead the process of winning back IMF backing by underwriting Biti's request.

IWPR has been told that the IMF team is in Harare mainly to review economic developments and prospects, and it will report to the 24-member IMF executive board, which plans to meet after 24 March to decide Zimbabwe's fate.

Clearly, Mugabe is paying attention.

Zimbabwe has been pleading with South Africa for aid. So far, no deal has been reached. A donor conference called by the Southern African Development Community’s Council of Ministers also ended in failure. A package from Pretoria would allow Zimbabwe to pay some or all of what is overdue, perhaps salvaging its strained relationship with the fund and getting back desperately needed foreign aid.

On 10 March, the IMF's director for Africa, Antoinette Sayeh, said the organisation could not disburse funding to Zimbabwe until the country cleared its arrears and demonstrated responsible economic policies.

"The fund is not in a position to disburse resources to Zimbabwe, among other things, because Zimbabwe is in arrears," Sayeh told Reuters. She was speaking on the sidelines of an IMF conference in the Tanzanian capital to discuss the impact of the global crisis on African economies.

Mangoma said after meeting the IMF team officials from the Bretton Woods institutions had expressed willingness to immediately assist Harare "to start things happening".

"The meeting was positive," said Mangoma. "They have told us that they are willing to immediately assist us."

By itself, this is a remarkable development. Mugabe has seemed impervious to foreign pressure, even as his own country has experienced extreme hardship and starvation. That he should care about the IMF is intriguing.

Analysts say perhaps he values the prestige of membership of one of the few international groups that wields real power in the form of cash, or perhaps he is hoping for new loans from which to skim cash - something that Britain and the United States have accused him of doing in the past.

"Mugabe may even want the money just to keep the lights on in Harare. It actually doesn't matter. The important thing is that the leverage is there," said a banking economist.

The leverage, however, does not reside with the IMF. By allowing itself to be placated, the fund has limited its own ability to affect policies in Zimbabwe. That may be for the best, some economists say, since insisting on specific changes would allow Mugabe to score political points by again rejecting the IMF altogether, with disastrous consequences for the inclusive government.

But the upshot is that the leverage sits solidly in South Africa’s hands. South Africa also seems willing to bail out its northern neighbor, provided Mugabe makes some lasting changes and shows real commitment to power sharing.

By Lesley Wroughton

WASHINGTON, March 5 - A high-level International Monetary Fund mission will visit Zimbabwe next week after a two year break to assess the country's dire economic situation and humanitarian crisis.

In a statement, the IMF said a staff mission led by Vitaliy Kramarenko will visit Harare between March 9 and 24 to conduct a regular review of the economy under the IMF's so-called Article IV consultations.

The visit by the IMF is not expected to lead to financial aid for Zimbabwe, but officials said it would give the lenders an idea of the direction of government economic policy.

"The IMF mission will review Zimbabwe's economic situation and prospects and discuss with the authorities their policies to address the acute economic and humanitarian crisis facing the country," the Fund said.

"The IMF team will work closely with a parallel World Bank mission," the IMF added.

The visit comes weeks after a new power-sharing government of old rivals was formed between Zimbabwe President Robert Mugabe, the country's sole ruler for nearly three decades, and Prime Minister Morgan Tsvangarai, the main opposition leader.

The IMF suspended Zimbabwe's voting rights in June 2003, barring it from participating in IMF decisions, as the Mugabe government fell behind on paying its IMF debts and the economic situation deteriorated.

"It is an important mission for the Bank, the Fund, for the government and donors," said Michael Baxter, the World Bank's director in the region told Reuters.

"We're trying to get a direct assessment of the governments proposed policies, how they are starting to implement them, and how they will lead to a longer term stabilization," Baxter added.

Last week, Southern African finance minister called on the World Bank, IMF and African Development Bank to help Zimbabwe recover from economic collapse and put the initial financing need at $2 billion.

Under their rules, the IMF and World Bank would not be able to provide financial assistance to Zimbabwe until the country has cleared its arrears to them.

The IMF said it will meet with Zimbabwe's Finance Minister Tendai Biti and other senior government officials, as well as representatives from the financial, business and diplomatic communities.

A report on the visit will be discussed by the IMF board in early May, the Fund said.

Tsvangarai has warned that the country urgently needs help as inflation has reached more than 200 million percent and rendered Zimbabwe's currency worthless.

He also said on Thursday that nearly 4,000 people were killed and up to 80,000 infected since the outbreak six months ago of a cholera epidemic in the country and the deadliest cholera outbreak in Africa in 15 years.

CAPE TOWN, Feb 26  - Zimbabwe has made an impressive start on an economic recovery plan which warrants support from the international community, African Development Bank President Donald Kaberuka said on Thursday.

He also told reporters on the sidelines of a summit of southern African finance ministers that the AfDB was prepared to set up a donor meeting for Zimbabwe but said the country's $5 billion foreign debt needed to be cleared to secure more aid.

Zimbabwe's new power-sharing government will be heavily dependent on foreign aid and investment to salvage the country's ruined economy.

But Western donors have made it clear money will pour in only when a democratic government is created and bold economic reforms implemented.

"It will require that Zimbabwe comes forward with a credible economic programme. Now the first steps I have seen, listening to (Zimbabwean Finance) Minister Tendai Biti is quite impressive and it merits support," Kaberuka said.

The new administration urgently needs to tackle an economic meltdown that has led to the world's highest inflation, food shortages and a cholera epidemic.

Prime Minister Morgan Tsvangirai said last week it would cost as much as $5 billion to repair the economy.

By Antony Sguazzin

Feb. 26  -- Zimbabwe is seeking aid of $2 billion over the next 10 months to revive its economy and tackle a humanitarian crisis, Trevor Manuel, South Africa’s finance minister, said.

The country is seeking loans to help rouse its economy from a decade-long recession and repair infrastructure, the minister said in an interview with the Johannesburg-based SAFM radio station today.

Zimbabwean officials presented two plans at a meeting with finance ministers from the Southern African Development Community in Cape Town, both of which need about $1 billion in funding, Manuel said. South Africa is in talks with Zimbabwe over one of the plans to improve the economy on a “bilateral” basis, he said.

Zimbabwe’s political leaders this month ended an impasse by forming a coalition government after disputed elections last year. A failed land reform program that began in 2000 has deepened the country’s recession, left more than half of the population in need of food aid and caused the world’s highest inflation rate. More than 83,000 people have been infected in a cholera outbreak.

Zimbabwe needs as much help as it can get to tackle “this horrible, horrible scourge of cholera,” Manuel said.

Fraser Mpofu
Correspondent

HARARE: Zimbabwe's biggest chicken producer, Irvin's Day Old Chicks, is now selling chicks in Botswana as well as Mozambique in an effort to circumvent foreign currency shortages and rising feed prices.  

HARARE, Feb 20 - International and regional financiers have offered Zimbabwe $500 million in credit lines to help repair its economy, but they remain cautious over conflicting government signals on policy, the central bank said on Friday.

Central bank governor Gideon Gono told reporters the funds would be used to rescue the economy following moves to liberalise the economy and the formation of a unity government, which is expected to ease political tensions.

LEAVE A COMMENT