Monday, January 28, 2008

"RBZ playing the victim and the perpetrator!"

The events surrounding the much-emphasized issue of cash barons, the equivalents of saboteurs are squarely positioned to divert attention from the owners of the economic chaos as mere victims of internal saboteurs. Which frames very well with the oversold sanctions myth.

The arrests and subsequent dramatic unveiling of the cash barons and their purported boxes of cash in the front the government owned daily, the Herald is a well-calculated, sinister plan designed to mentally cripple us as recipient of such toxic information. The 'toxic' articles are meant to divert us from the real issues which must be interrogated, issues of a highly informalised economy which is massively anti-financial inclusion, a typical situation reflective of a collapsed economy.

Like most informal businesspersons they do not want scrutiny therefore they carry most transactions outside the bank. Imagine if the USA, with all its military strength was to pursue all its currency littered around the world, it would inevitably arrest millions of global citizens including nations. Let alone if South Africa were to hunt down its Rands most Zimbabweans would have been nabbed for concealing them under their pillows.

This clearly locates the irrelevance of the so called cash barons in mothering the painful cash shortages, as I have emphasized before that there is no causal relationship between cash barons and the cash shortage, the cash barons are just results of a heavily mismanaged and highly informalised economy. The cash barons are a striking coincidence resultant and symptomatic of the economic collapse.

To make it a national priority to pursue the so called cash barons as one of the strategies meant to arrest the deteriorating situation is the equivalents of burning huge forests in order to pursue a problem rat. To what extent do the propaganda and the dramatic arrests; including more arrests to come contribute to the violation of the Zimbabwe brand? The treatment offered to local entrepreneurs, with the latest case of Hon Butau in mind is a national brand marketing disaster, which further taints our image as an unsecured and overregulated economy.

This unavoidably leaves domestic and foreign investors of all origins including the dear Chinese frightened as to their safety. The implications will be worse if Hon Butau is subsequently specified. Zimbabwe provides a critical specimen of nations that have endured a harsh legacy because of the deficiency in the sanctity of security in the economic arena.

The neo-populist laws of indeginisation, land reform (legal and illegal seizures of farms), to name a few, have all combined to compromise the Zimbabwe brand. The location of all policies within a campaign strategy has heavily influenced the postcolonial state's framing of policies. As a heavily recycled and out of touch leadership with no solutions to offer, the government including through its RBZ has located their 2008 survival manifesto in presenting themselves as victims of local and external saboteurs. This effectively frames well in their propaganda matrix, which also presents the government as a victim of a strategic response from Britain, EU, USA and Australia meant as punishment for engaging on the Fast Track Land Reform programme.

Dr Gono did effectively provided the recipe for the strategy when he threatened to name the barons if he appears before the relevant parliamentary portfolio committee. This locates the role of Gono as the conveyer belt of the propaganda who clearly was aware or played a central part in the formulation of this strategy.

Did Gono unveil this statement designed to launch the propaganda crusade without the approval of his principals?There was tacit approval of Gono's witch hunting strategy to the extent that it lacked the sense it was predicated to inform. How can Gono have the ironic propensity to appear at journalists and purport to hold strategic information about economic crimes instead of sharing the information with law enforcement agencies, who in a democratic value driven society are supposed to investigate and verify in order to prosecute any violators.

Gono was clearly attempting to trigger citizenry sympathy and empathy, of him and his principals who have arguably failed to arrest the economic decadence, as victims of the so-called cash barons whilst also tacitly playing the double role of perpetrators. Gono and his RBZ are well known drivers of inflation through his dubious quasi-fiscal programmes that have never delivered value to the ordinary citizens who have been made to endure painful economic suffrage.

The government destroyed the formal economy in a vigorous campaign from the time its legitimacy came under scrutiny from the people. Of late the operation dzikisai mutengo/ lower prices was clearly a strategy informed by the fact that the lack of control of the economy by government emanated from an unholy alliance between the businesses sector and the Western detractors. Who we were told were supposed to be made to loose out through the price shock therapy, which frames well with the double role victim and perpetrator.

And like a perpetrator the government managed to flush all transactions from the formal market and the current cash shortages were predictable as a consequence of the operation. It is also interesting that the introduction of the new bearer cheques of denominations $1million, $5million and $10million are simply efforts to postpone the cash crisis to a later date even before the March elections instead of implementing strategies designed to re-formalize the economy.

As Gono and his principals oscillate between victims and perpetrators they have failed to provide the critical success elements required in redeeming us from this evil. It has thus added an urgent matter before us as citizens of this troubled nation to collectively unite ourselves as a catalyst of the Zimbabwe we want. We should introspect ourselves as to how long should the future be compromised by a leadership devoid of an upright moral value system?

Hillary Kundishora is a Scholar of Strategic management. He can be contacted on or

Saturday, January 12, 2008

The RBZ: The Mother of all hypocrisy or a den of gangsters?

It is now certain that the 2008 elections will be held in March notwithstanding the protestations by ZANU-PF’s negotiating partners in the SADC mediated talks facilitated by President Mbeki.

The country will for the first time hold joint presidential, parliamentary and council elections after the negotiating partners through their parliamentary representatives unanimously agreed in Parliament to the Constitutional Amendment Act No. 18 which has paved way for the elections.

The terms of the President, parliamentarians (whose term of office has been shortened as a consequence of the negotiations), and local authority representatives are accordingly due to expire in March presenting an obvious challenge to anyone advocating a transitional period post March.

Clearly, the mandate of ZANU-PF and MDC to extend the election date has its own constitutional ramification that is not the subject of this article. The people of Zimbabwe will be presented with an opportunity to make a choice about who should govern them. The last eight years have been characterised by an atmosphere in which two forces have been engaged in an unprecedented political fight that has regrettably assisted in worsening the economic situation and in providing an opportunity for economic management experimentation.

The mere fact that Chinamasa/Goche and Biti/Ncube needed SADC intervention to arrive at the conclusion that the parliament of Zimbabwe, whose legitimacy in relation to ZANU-PF the MDC had consistently challenged, was a competent body to amend the constitution of Zimbabwe rather than the people as advocated by MDC’s traditional partners demonstrates the complexity of the crisis.

What the last 8 years have shown is that both MDC and ZANU-PF have no confidence in the Zimbabwean constitutional order. As a result, the executive has been provided with a unique opportunity to exploit the situation by systematically transferring the functions that are normally performed by cabinet to the RBZ thereby effectively rendering the parliamentary oversight function irrelevant.

As a result, it is now Gono who has to invite himself to parliament rather than the Minister of Finance reporting to the nation through parliament about the state of the nation’s finances and how it is that so-called cash barons have overtaken the political barons as the most wanted criminals.

Only a dysfunctional society would produce a situation where both parliament and the executive branch of the state abdicate resulting in the erosion of the rule of law and destruction of the moral values generally expected in a normal functioning state.
In such a situation, it is important for any discourse about change in the context of Zimbabwe to be located in an empirical framework otherwise it will be difficult if not impossible for citizens to make judgments about the culpability or otherwise of the key players in the Zimbabwean drama who have helped imprison the country is a state of siege while purporting to represent national interest.

The role of the RBZ in undermining democracy has to form part of the debate about the future of the country in the past March elections. Can President Mugabe who has presided over the systematic collapse of the state be trusted to bring the change that Zimbabweans can believe in? Can the MDC under the current leadership be trusted to bring the changes that Zimbabweans can believe in?

To the extent that MDC has found it fit to boycott parliament notwithstanding the fact that during the last 8 years, parliament has been used to rubber stamp some of the most draconian legislation that offend any democratic order, can the MDC be a trusted agent of change?
The economic health of any nation provides a reliable barometer of the extent to which the nation is leaving up to the expectations of its citizens. There is consensus among all that the economic situation in Zimbabwe has to change. ZANU-PF blames the MDC and its purported external principals for the economic decay and collapse while the MDC blames President Mugabe who has been in power for the last 28 years for the mess.
Even President Mugabe would agree that all is not well and yet ZANU-PF believes that without him the economy will not get better. ZANU-PF has not accepted that leadership has anything to do with the crisis rather the supporters of President Mugabe believes that the economy is safe in the current hands.

What is evident is that Gono has run out of solutions and the blame game is rapidly coming to its logical end. How long can Gono point fingers at other people without looking at himself in the mirror and taking responsibility?

It appears that Gono still has some currency and he will be a factor in the forthcoming elections. Already he has almost successfully exploited the cash crisis and generated useful political dividends for ZANU-PF.

He promised to identify cash barons and judging by the number of convictions that have already been reported it is evident that the RBZ is fighting back. The RBZ has already managed to ensure that Butau will not be a candidate in the next elections. Equally any prospective candidate for parliament will have to consider seriously about challenging the RBZ for the consequences can be personally disastrous.

Hypocrisy plays an important part in any political life. However, no one would expect an institution like the RBZ to be at the center of hypocrisy at a defining moment in Zimbabwe’s history. The manner in which exchange control violations have been handled by the RBZ under Gono’s stewardship requires critical examination.
Anyone who cares deeply about Zimbabwe can ill affords to ignore the role of the RBZ in distorting and undermining political and economic morality. I am convinced that people no longer know who to believe or what to believe.
How can any nation seriously go for an election when citizens have been sufficiently abused by their own servants? The stakes are high for Zimbabweans to be nice to each other.

I believe that there comes a time in every generation when each one of us is called to think seriously about legacy and what future generations will say about this moment and the choices made. Zimbabweans have gone through a lot and they deserve better.
The Butau case is pregnant with lessons that should form part of the conversations about the future of Zimbabwe. The factual matrix keeps on unfolding but the latest information that Mr. Butau’s Personal Assistant has been convicted provides yet another example of the manipulation of public opinion by the RBZ and, indeed, by the state.

The Herald informed us that Ms. Getrude Matika pleaded guilty to illegally dealing in foreign currency and by default confirming that Butau is also guilty. If his PA is guilty then surely Butau cannot argue that he is innocent and this then confirms what Charamba has been saying that the West is guilty of undermining the sovereignty of Zimbabwe by giving sanctuary to criminals like Butau.

This begs the question of what precisely did Ms. Matika plead guilty to. The facts presented by the Herald are as follows: a company, Dande Holdings, allegedly owned by Butau, employed Ms. Matika. At all material times she worked for Dande and not for Butau. She has pleaded to transferring Z$87 billion from the company and not to Butau’s account into various accounts before getting the equivalent in local currency using the parallel exchange rate.

From the above, it is evident that Ms. Matika derived no benefit from the transaction. Equally, Butau did not derive any personal benefit from the alleged transfer of funds. In any normal country, the mere transfer of funds from one party to another would not constitute a criminal violation. Ms. Matika was imprisoned for her role in performing duties for her principal, Dande Holdings. If Dande was the party to the transfer of funds then surely the company would have been the accused and the imprisonment of officers of the company would be improper.

Notwithstanding, Ms. Matika had to buy her temporary freedom by posting a bail of Z$50 million with stringent conditions. The agreed facts are that between October 25 and December 19 last year, Ms. Matika was instructed to complete Real Time Gross Settlement forms transferring money from the account of Nyamasoka Farming, a company allegedly owned by Butau. It is alleged that Butau signed all the RTGS forms and the money was channelled into the black market for the purchase of buying foreign currency. In October 2007, it is alleged that Ms. Matika in the course of performing her duties to her employer was further sent to Bulawayo to collect the foreign currency sourced from the illegal parallel market from one Bekezela Jabwa who gave her US$12,891, R81,580 and 1,100 pula being the foreign currency equivalent of the funds transferred from Nyamasoka’s account. The foreign currency was delivered to Butau.

It has now emerged that the funds transferred by Nyamasoka were part of the deal structured by the RBZ whereby the bank acting as an agent of the government in the procurement of imported tractors put together a scheme involving a shelf company, Flatwater Investments. It is commoncause that Flatwater received Z$2.1 trillion from the RBZ for the sole purpose of buying foreign exchange in the black market.

Mr Guvamombe also convicted a director of Flatwater, Mr. Taziwana Chivaviro and the Chief Operations Officer, Nigel Tatenda Marozhe, on their pleas of guilty to dealing in foreign currency. They were remanded out of custody to today for mitigation and address of special circumstances before sentence is passed. It has been reported that Mr Guvamombe ordered the pair to pay $250 million bail each and surrender the title deeds of their respective properties. At the core of the Butau matter that has regretably resulted in the arrest of third parties is the role of the RBZ in a transaction that is now alleged to have contravened the laws of the country. It is now known that In October last year, RBZ released Z$2.1 trillion to Flatwater for the purchase of 102 tractors for the Government’s Agricultural Mechanisation Programme on terms and conditions that are still not known and for which Mr. Guvamombe appears not to have an interest in apart from expressing outrage while proceeding to convicting individuals who appear to have been agents of their employers. The court heard that RBZ, a body corporate established under an Act of Parliament and Flatwater entered into a verbal agreement and not a written agreement before the cash was released. Can you imagine a bank that is supposed to be repository of national trust and confidence being party to a transaction in which public funds are transferred to a private company without any written document? Only in a banana republic would you expect this to happen and for the courts to turn a blind eye to such actions by a state organ.

In any functioning state, the central bank deals with authorised financial institutions and not directly with the public. Flatwater is alleged to have engaged a foreign currency dealer, Joseph Manjoro, to source the foreign currency. According to the court records, Manjoro received the funds and allegedly converted Z$708 billion to own use and concluded a transaction with Butau’s company for Z$562.5 billion. Mr. Anthony Hobwana was also engaged by Flatwater to source foreign currency in line with the mandate from the RBZ and received Z$575 billion. Another company, Squareaxe (Private) Limited, owned by Royas Mazorodze, also received Z$575 billion from the RBZ deal. It has now been alleged that parties that were contracted by Manjoro on behalf of his principal, Flatwater, did not raise the equivalent in foreign currency as expected by the RBZ. Ordinarily in such a situation, Manjoro would have recourse to the courts against its counter parties. It is evident that the RBZ would have no interest in the dealings between Manjoro and his contracting parties and, therefore, no criminal violation would have been committed against the state. The complainant would be Manjoro himself who now finds himself also accused in the same matter. The RBZ’s contracting party appears to have been Flatwater and yet it is not evident in the proceedings in Zimbabwe that this was the legal position. It is not clear why the state would be interested in the affairs of Flatwater and its agents or contracting parties. It is also clear that there were no agreements between the parties leading the RBZ to take the law into its own hands. The idea of self-help is inimical to the rule of law and it is clear that the RBZ is judge in its own cause.

The only instance in which all the convicted parties would stand accused for what is clearly a corrupt and non-transparent deal is when the rule of law is no longer applicable.
Zimbabweans have been told that even Manjoro converted some of the funds received from Flatwater to his own use. The RBZ expected Flatwater and not Manjoro to raise US$1.25 million at an exchange rate of Z$1,696,520 per US$1. Manjoro only managed to raise US$357 000 from the black market. The funds were deposited into the bank account of Michigan Tractors in South Africa resulting in the procurement of only 39 tractors out of the expected 102, which naturally must have enraged Gono. It has been establisged that Mr. Phillimon Makuvise, whose surname is the same as the CEO of CBZ, Gono’s former employer, acted as a middleman between Flatwater and Manjoro leading him to be convicted as well. He is also on a $100 million bail. What emerges from the above is a classic case of abuse of state power. It does not take a rocket scientist to see that Gono unleashed the state machinery to resolve what appears to be a deal gone sour.
If the individuals implicated had known that the real principal in this corrupt deal was the RBZ, I am sure they would have taken a different view to their involvement. But who would imagine that an organ of state would be involved in an illegal transaction fully knowing the consequences of such actions. What is shocking is that the state appears to be impotent in dealing with the RBZ leading to questions being legitimately asked about whom is the state really serving. Would it be fair to conclude that the RBZ is now the mother of all hypocrisy or a den of gangsters who have the state machinery at their disposal to resolve disputes in violation of Section 18(9) of the Constitution of Zimbabwe that states as follows: “Subject to the provisions of this Constitution, every person is entitled to be afforded a fair hearing within a reasonable time by an independent and impartial court or other adjudicating authority established by law in the determination of the existence or extent of his civil rights or obligations. [Subsection as amended by section 3 of Act 4 of 1993 - Amendment No. 12]. “

By Mutumwa Mawere. He can be contacted at

Sunday, January 6, 2008

Dr Gono A Threat To Foundation Of The Nation-State

A Nation-State was conceived out of popular sovereignty arising from the ‘will of people’. The Nation-State derives legitimacy, and the natural right from a collective shared meaning and identity of those subjects who are constitutive of it, this creates a unity (socio-economic and political unity). A classical case is the conception of the USA from the declaration of independents on the 4th of July 1776. Society is the one that shapes the rules of the game and social order emanating from the wants of the collectivity of a people, who comprise the Nation-State.

Nation-States in much of postcolonial Africa collapse in most instances because of leadership failures and leadership decisions which are in conflict to the socio-economic and political unity that underpins a Nation-State, these are instances when the leadership (On behalf of the Nation-State) can no longer deliver positive political goods (e.g. Health, education, economic opportunity etc), and this eventually triggers a legitimacy crisis and to some extent a legality crisis or both.

A shared meaning and understanding in postcolonial Zimbabwe is under attack from some offensive false mental revolution, called economic discipline being propagated by none other than Dr Gono, through his RBZ, the Chief conveyer belt of the face serving propaganda that the economy is under siege from detractors. Gono has caused wide spread panic and anxiety in many law abiding and moral citizens of this beloved nation in the name of his false and elusive economic turnaround slogan.

Dr Gono has vigorously campaigned to position himself as the greatest threat to the founding principles of a Nation-State by necodemosouly re-writing the rules of the game from outside the society’s wants, by criminalizing rationality rather than supporting it. A lot of minds, crucial for the economic resuscitations are being externalised out of his devious efforts through his externalisation crusade, which targets the so-called cash barons, the case of Hon Butau is the most recent one to hit the headlines, after he was made to flee for his dear life to the UK.

To what extent is Gono determined to destroy the shared meaning and identity of the economic unity (Nation-Sate) espoused by the Zimbabwean people? Economic regulations must be designed in such a way that they deliver, in continuum economic opportunities to the people of Zimbabwe. In fact all laws to be functional they should make practical and moral sense to the people.

When Gono was appointed and not elected he immediately sought to undermine the shared economic understanding and identity of a collective people by trying to convert people to submit to a warped, immoral, illogical, and criminally undervalued exchange rate, which militates against the economic vision of competitiveness to which the liberation struggle was predicated.

This clearly raises questions as to what extent are the so-called cash barons/economic fugitives actually victims themselves, since there are defying an unjust and immoral law? It is not a contested reality that the Zimbabwean Diaspora is now remitting huge remittances to their loved ones in this economically dysfunctional Zimbabwe, which finds its way to the so called black Market, which is a euphemisms for Gono’s externalisation crime.

To What extent is Gono responsible for trying to criminalize the whole nation by making these rational efforts of engaging in financial exclusion a crime? Gono also knows it facts, that once you carry out your transactions via the banking system you cannot access your money any more, so who wants to sacrifice his resources just to satisfy the quest for Gono’s irrationality?

A deeper understanding clearly shows that Gono is part of some broader and sinister political propaganda considering the much power he holds in entrenching all these nonsense solutions predicated on failure is not an option. Gono’s efforts are designed to divert national discourse from his own failures and those of his principals, who are supposed to face a legitimacy interrogation because of their leadership failures.

The so-called cash barons like the sanctions myth are just mere sacrificial lambs in an election gimmick premised on a false anti-corruption drive. People should be awake to the fact that the financial exclusion by the so called cash barons is not responsible for causing the cash shortage but an issue of just a correlation/coincidence in occurrence, which does not necessarily mean causation but resultant of the cash shortage, hence the two being intertwined.

Who are the beneficiaries of the fixed exchange rate policy? What happens if we adopt a managed float exchange rate, which is more realistic? Are all top officials, including the executive arm of government submitting and carrying out their personal transactions using this nonsensical exchange rate?

What harm has been done to the Zimbabwe brand through the widening of the fugitive list? Are other international foreign investors prepared to invest in Zimbabwe given the treatment offered to indigenous born businessmen?

To what extent is Gono a paradox of what he purports to represent? Where does he source foreign currency for government programmes?

How can there be an economic turn around devoid of popular collective national vision and wisdom? How can we police a law, which everyone is making an effort to break? To what extent is Gono assaulting our natural liberties? To what extent is Gono trying to fool us to runaway from our shadows? Answers to all these questions will reveal that Gono is now a liability to this nation; in fact more costly than the inflation he purports to fight.

What we need as a nation towards a failed state is to find each other based on the economic unity, which was in the past used to underpin us as a Nation-State. We need to foster a full partnership in economic progress not witch-hunting by building sustainable regulations, not over-regulation in order to create domestic and international investors who are psychologically liberated and secure

I submit that building a truly prosperous competitive economy, which is robust, entrepreneual, and resilient is the only way we could get out of this vicious cycle of economic decay. We must ditch old-fashioned economics of controls for exchange rate parity to allow more increased private sector participation if we are to secure an economy which continuously deliver political goods in order to avoid a popular legitimacy crisis.

We cannot afford to abandon a winning formula, government leadership should be pro-active and ensure a healthy fiscal and monetary management of the economy. The rest of the world is entering an accelerated industrial drive, a drive not based on fascination with industry but on simple truth that we want to develop rapidly-a situation where the developed economies are moving out of industrialisation to a post-industrial age.

As for Gono, all elected officials with a mandate from the Zimbabwean electorate should work tirelessly to reclaim all the stolen and illegal authority he now holds. Of which I presume reclaiming the abused authority will be difficult because he has already outgrown most of the elected office bearers in orchestrating his externalisation war with the blessings from his illegitimate principals.

Hillary Kundishora is a scholar of Strategic management. He can be contacted at or