24 December 2007

Zimbabwe: Corruption 'Destroyed' the Country

Harare — Corruption has now been officially acknowledged as one of the greatest cancers abetting Zimbabwe's sharp economic decline.

At the ruling ZANU-PF party's Extraordinary Congress last week, Reserve Bank Governor Gideon Gono named it as one of several factors responsible for the nation's economic woes.

Analysts say, however, that in spite of this official recognition of the problem, the government is not expected to try to stem the scourge of corruption as so many officials are themselves involved.

At the congress, which ran from December 11 to 14, Gono said there were "cash barons" in the ruling party and government who were keeping huge quantities of money for speculative purposes and trade in the illegal foreign currency market.

Zimbabwe has been in the grip of a serious currency shortage which has seen people spending days queuing outside banking halls to withdraw their salaries. This has badly affected production as man hours are wasted while people move from bank to bank in search of cash.

The official exchange rate is 285,000 Zimbabwe dollars to one US dollar. On the parallel market, one US dollar fetches 1.6 million ZWD.

Opposition parties and business have in the past accused the central bank of stoking the country's inflation of over 8,000 per cent by printing paper money and introducing other quasi-fiscal activities into the economy.

This week, the central bank was expected to introduce new currency to ease the cash shortage.

Gono revealed at the ZANU-PF congress that while the central bank had injected 67 trillion ZWD into the market, only 2 trillion ZWD could be accounted for by the close of business last week.

"Our question is: who has all the other money? That is also the reason the central bank has taken its time to respond to the cash crisis," said Gono. "We cannot keep on printing money before we account for the other 65 trillion ZWD.

"Corruption, corruption, corruption has destroyed this country," Gono told last week's congress, which was also addressed by President Robert Mugabe among other senior government officials.

Analysts said the official would not have made such a bold claim without the knowledge and tacit approval of the president.

However, his claim is contrary to the official party line, which blames most of the nation's economic woes on western sanctions imposed on Mugabe and his top officials, and on this year's drought.

Gono's claim was along the same line as that taken by the country's corruption watchdog, Transparency International Zimbabwe - which has also blamed the nation's problems on misconduct, as well as Mugabe's intricate patronage system.

Last year, Industry and International Trade Minister Obert Mpofu told a parliamentary committee that senior government and party officials were deeply involved in the wholesale looting of resources at the Zimbabwe Iron and Steel Company.

While he later retracted the claim, some thought that this was done under pressure.

Mpofu was charged with perjury for lying to parliament - a charge likely to fall away after parliament is dissolved to make way for the harmonised presidential, parliamentary and local government elections scheduled for March.

A number of party and government officials have been implicated in the smuggling of precious minerals since the discovery last year of diamonds in the Chiadzwa district of Manicaland Province.

While Mugabe had warned that corruption would not be tolerated, neither he nor anyone else has dared name names.

Last week, Gono said an average of 15 tonnes of gold worth 400 million dollars was smuggled out of Zimbabwe every year.

"Diamonds worth over 800 million dollars have been smuggled out of the country," he said. "Other minerals have either been smuggled or under-invoiced to the tune of about 200 million dollars per year.

"In total, therefore this economy is losing on average not less than 1,7 billion dollars per year through economic sabotage perpetrated by a few of us with the knowledge and/or complicity of many seated in this hall," he said to deafening applause from the public gallery.

"We are now aware of the massive syndicates of cash barons who are hoarding cash and consequently creating shortages."

However, Gono immediately beat a retreat.

"I will not disclose what we are going to do and we want to see the congress express itself on what is causing the shortages," he warned darkly.

His challenge was immediately taken up by Mashonaland East provincial chairman Ray Kaukonde, who called on Gono to produce this list of cash barons.

Kaukonde then asked the question on everybody's lips, "On behalf of provinces, I would want to ask what it is that is causing these people not to be arrested?"

Gono said by speaking his mind, he was making many enemies for himself. "I will be the focal point of attack and worse smear campaigns than ever before," he said.

A senior official with Transparency International said he was sceptical that any action would be taken by the authorities.

"Gono is saying all the right things. Unfortunately, corruption thrives in ZANU-PF and government itself," he said.

A political analyst at the University of Zimbabwe said that nothing would come of Gono's self-righteous protests and that ZANU-PF was well known for protecting its own.

"We have become hostage to the culture of secrecy," said the analyst. "Nobody wants to name and shame because none of them is clean. Not even the president seems to have the courage to name corrupt officials in his administration.

"The same people accused of hoarding cash have been implicated in black-market foreign currency deals, the illegal sale of state-subsidised fuel, fertiliser, maize seed and other farm inputs.

"It is the same people implicated in the smuggling of precious minerals. Once in while there are token arrests but the real culprits are beyond the reach of the law.

"Corruption has become a cancer in Zimbabwean society, and unfortunately the pain is felt mostly by you and me - the poor."

Meshack Ndodana is the pseudonym of an IWPR journalist in Zimbabwe.

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