Zim News Blog -NEWS NETWORK

PRESIDENT Emmerson Mnangagwa is under pressure from senior Zanu PF officials to reshuffle cabinet, which has failed to turn around the imploding economy, the Zimbabwe Independent understands. Mnangagwa, who swept to power through a military coup in November 2017 which toppled long-time ruler Robert Mugabe, is struggling to stem and reverse the economic meltdown. This […]

Source: Ginimbi tax evasion investigations complete | Daily News

HARARE – Businessman Genius Kadungure was back in court yesterday for continuation of his $22 million tax evasion case.

Kadungure was represented by Jonathan Samkange when he appeared before Harare regional magistrate Vongai Guuriro.

Prosecutor Shephered Makonde advised the court that investigations in the matter had been completed and a trial date would be issued for Kadungure on March 21. According to the State between February 2009 and May 2016, Kadungure allegedly made misrepresentations to Zimbabwe Revenue Authority (Zimra) that his company Pioneer Gases made total sales of $2 777 678,13 although the total was

$9 092 951,51.

It was alleged that Kadungure made the misrepresentation to avoid paying tax and Zimra was prejudiced $417 940, 58.

The offence came to light when Zimra investigated operations of Pioneer Gases and a lifestyle audit of Kadungure. On March 2, 2016, Kadungure told Zimra investigators that he owned a Domboshawa residential property valued at $200 000, Rolls Royce, Bentley Range Rover, a Mercedes-Benz S Class and BMW motor vehicles.

Zimra investigators asked Kadungure to prove the source of income but failed to do so leading to his arrest.

Between January 2010 and December 2015, Kadungure did not declare sales made by his Pioneer Gases amounting to $9 092 951.51 and concealed assets valued at $1 191 713.45.

Section 81 (1) (a) of the Income Tax Act required Kadungure to file tax returns and pay tax due to the Commissioner of Taxes.

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Source: Political parties withdraw from National Dialogue | Daily News

HARARE – President Emmerson Mnangagwa’s multi-party initiative for a national dialogue could soon reach a dead-end after three political parties withdrew citing lack of credibility among other reasons.

Sources who were present during the closed door meetings said some of the political parties were beginning voice concerns over the direction the talks were taking.

United Democratic Alliance (UDA)’s Daniel Shumba wrote on his Twitter handle soon after the meeting saying he had formally withdrawn from the National Dialogue process which he described as  “insincere, choreographed, and highly compromised, with some political principals singing for their supper.”

“We disagree with the process, purpose, issues and level of engagement. Clearly, no outcomes can be expected from this facade.

“The process starts with a predetermined agenda even before agreeing on the moderator, issues, or milestones.

“It’s inconsequential and of no effect,” he said.

While many had hoped for a national dialogue facilitated by the National Peace and Reconciliation Commission (NPRC), the organisation’s chairperson Selo Nare told this publication that the OPC was handling the dialogue.

With regards to the facilitator, Shumba added: “It (meeting) was presided over by a Nare (Selo Nare), who is clearly out of his depth, and following a Zanu PF script. They refuse to broaden the participation to include other stakeholders,” he added.

Some political parties who snubbed the meeting echoed Shumba’s sentiments questioning Mnangagwa’s model of dialogue which “fails the credibility test”.

In a letter addressed to Chief Secretary to the President and Cabinet (OPC) Misheck Sibanda, Build Zimbabwe Alliance leader Noah Manyika said: “No meaningful dialogue can happen without neutral and credible convener being agreed on to facilitate a broad and inclusive dialogue that will include trade unionists, political parties, civic groups and all stakeholders to ensure that the views and interests are represented.”

He added: “It is in my view that a dialogue without MDC Alliance and any other critical stakeholders … the (dialogue) will not pass credibility tests locally and globally and it is our collective  responsibility and specifically that of our convener that would emerge from this process to ensure that everyone who needs to be at the table is included.”

While this could have been a significant development which could signal the beginning of fresh dialogue to normalise politics in Zimbabwe, another political party also slammed the door to dialogue.

People’s Progressive Party of Zimbabwe leader Timothy Chiguvare also wrote: “We regret to inform you that we will not be taking part in the national dialogue due to the position we have taken as a party and intend to make our position public very soon.”

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Source: RTGS dollar starts strong | Daily News

HARARE – Zimbabwe’s new RTGS dollar held firm at around 2,5 to the United States dollar (USD) as it started trading yesterday, the Daily News can report.

With the bond note, bond coin and RTGS dollar (RTGS$) assuming the role of Zimbabwe’s medium of exchange, banks quoted the new currency within the 2,5 range to the greenback.

This was way lower than trades that had obtained on the parallel market before the unveiling of the monetary policy statement on Wednesday, where the USD was fetching as much as four bond notes.

Ecobank and Steward Bank were among lenders quoting prices, with rates between 2,44 and 2,53 per dollar.

On the black market, the rate for the quasi-currencies strengthened slightly, but at roughly 3,5 per dollar yesterday, according to local website marketwatch.co.zw.

RBZ governor John Mangudya told an oversubscribed business forum hosted by the Daily News yesterday that the central bank had agreed with commercial lenders to let the RTGS$ float at 2,5 to the USD.

“This is a willing-buyer, willing seller arrangement. So, it’s not an auction, it’s a floating exchange rate system…,” he told business leaders.

Under the new regime, banks will be required to report interbank activities daily to the RBZ while bureaux de change shall be authorised to sell up to US$10 000 daily for small transactions.

The central bank will publish the going daily rates in national newspapers.

Mangudya said black market prices for real dollars were high because it had been illegal to trade that way and thus they carried a risk premium, which would drop now that trading had been formalised.

The RTGS$ are expecting to hold steady, with an anticipated central bank sell-off of dollars helping ease tightness in the supply of hard currency.

On Wednesday, the RBZ made a bold step to free up its fiat currency, particularly scrapping the bond note-USD peg and paving way for devaluation as the market will now determine rates.

If yesterday’s trades are anything to go by, these measures have won the support of banks and business.

Finance minister Mthuli Ncube who also graced the Daily News Business Breakfast Forum said “industry also wanted this (currency reforms) to happen,” referring to the market-based mechanism in the allocation of foreign currency and the market-based exchange rate.

He said government could not let “the streets” continue “driving policy, driving prices, driving everything.”

“And look, we thought, this is not a good idea, you think so as well. Now we want to make sure that we formalise things and that’s what we have done. And let’s be honest colleagues, the 1:1 was punishing exporters. We saw that the market top-over was a better way of doing this,” Ncube said.

First launched in 2016, the authorities had decreed a one-to-one pegged exchange rate between bond note and the US dollar even though the greenback and other foreign currencies were now fetching higher premiums on the parallel market.

The much-criticised move starved the economy of dollars into the formal market, scared away investment and plunged the stuttering economy into massive price hikes of goods and services as businesses played a cat-and-mouse game with the authorities who abhorred dealing on the unofficial market.

Mangudya told guests at the Daily News Business Breakfast Forum that all prices will now be in RTGS$, which will replace the US dollar as the currency of reference, pricing and debt settlements.

He said there will be no change in money held by individuals and corporates.

“EcoCash is going to continue working the way it was working yesterday, so is Telecash and OneMoney. No change. Are the banks going to change? Not the accounts that are there, they are not going to change. So, all what we have done is to formalise what is there. So that formalisation has implications, this is where we spend more time to present the Monetary Policy Statement,” he said, denying reports of a rift with Ncube.

The Finance minister concurred with Mangudya that there was no rift between them.

The RBZ boss said he has secured sufficient foreign currency funding to safeguard and underpin the interbank market from the Africa Export Import Bank, PTA Bank and Ecobank.

Explaining why he decided to adopt the RTGS$ as the major instrument of trade, he said all the money in Zimbabwe was seated on the RTGS platform.

“And out of $10 billion of deposits in this economy, about 95 percent of that money is seated on the RTGS platform; 25 percent are bond notes. We have been very restrained in printing the bond notes. We only have $437 million of bond notes and $86 million of bond coins,” he said.

Mangudya called on black market traders to apply for licenses to operate retail foreign exchange bureaux as the southern African country cracks down on money-laundering.

Mangudya admitted that the 1:1 exchange rate was unfair to exporters.

“I am guilty as charged, taking exporters’ money at 1:1 when prices had risen by three or four times, it was unfair. We had to change in accordance with the demand for change in the market,” Mangudya.

The biggest opposition party, the MDC, isn’t convinced.

“It’s insanity,” said Tendai Biti, a senior party leader and former Finance minister.

“They have through the back door reintroduced the Zimbabwe dollar.”

He said the country’s fundamentals won’t support a new currency because there are no reserves to back it up, no market confidence and no macroeconomic stability. Biti estimates that the RTGS dollar will trade at between six and eight to the US dollar.

The central bank will probably have to supply plenty of real dollars to keep the exchange rate stable, according to NKC African Economics, based in Paarl, South Africa.

“To anchor price stability, the Reserve Bank will aggressively intervene in the liquidity market,” Jee-A van der Linde, an economist at NKC, said in a note to clients.

“The fact that officials finally came to their senses and ditched the notion that Zimbabwe’s quasi-currency was at par with the US dollar, is comforting.”

Foreign investors in Zimbabwean equities, who have struggled to repatriate dividends or move their money out in recent years because of the dollar squeeze, would probably wait before using the new system, according to Allan Gray Ltd.

The Cape Town-based investment manager owns stocks in brewer Delta Corp. Ltd. and Econet Wireless Zimbabwe Ltd among others.

“It is too early to tell how this new system will work, but it is an important step in the right direction,” said Nick Ndiritu, a money manager at Allan Gray.

“Once the dust settles over the coming days and weeks, the long-term success of any currency reforms in Zimbabwe depends on the extent to which government can curb the growth of money supply and maintain fiscal discipline.”

—  Additional reporting by Bloomberg

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Source: Ex-minister's hero status angers Zapu | Daily News

BULAWAYO – The honouring of the late former Cabinet minister Callistus Ndlovu as a national hero has left the Dumiso Dabengwa-led Zimbabwe African People’s Union (Zapu) seething with anger — as it sees him as “a sellout”, the Daily News can report.

Ndlovu — who was the ruling Zanu PF’s Bulawayo provincial chairperson — collapsed and died at the age of 83 in South Africa on Wednesday last week, where he was being treated for pancreatic cancer.

He will be buried at the National Heroes Acre in Harare today, having defected to Zanu PF in 1984, at the height of the brutal crackdown against PF Zapu members by the country’s security forces around the time.

This was just before PF Zapu, which was led by the revered late former vice president Joshua Nkomo, entered into a peace accord with ousted former president Robert Mugabe and Zanu PF — following the Gukurahundi atrocities of the early 1980s in which an estimated 20 000 innocent people, mainly in Matabeleland and the Midlands, were killed by the security forces.

Thirty-five years after Ndlovu’s controversial defection from PF Zapu, including calling the party a “dead donkey” at the time, Dabengwa’s organisation said bluntly yesterday that the fallen politician did not deserve to be ranked among the “genuine heroes” of the country.

“We do commiserate with the Ndlovu family on the death of their loved one. I also knew him personally, but Ndlovu’s declared hero status is a nonevent to Zapu.

“We recognise the remaining sell-outs in Zanu PF on the account of the 1987 Unity Accord that was signed to end the Gukurahundi genocide on Zapu and Ndebele speaking people.

“The lesser sell-outs are those who, after being arm-twisted to join Zanu PF in 1987, developed cold feet when Zapu pulled out in 2009.

“But Ndlovu does not belong to this category of spineless former cadres. He belongs to the real sell-out clique of Zapu members who abandoned their kith and kin right at the peak of the Gukurahundi genocide,” Zapu spokesperson Iphithule Maphosa told the Daily News yesterday.

“So, and in a nutshell, his hero status is nothing more than Zanu PF’s celebration and rewarding of mediocrity and loyalty — in the same manner they have rewarded corruption and looting.

“Mediocrity as seen on Ndlovu as a nationalist politician and leader with zero contribution to the development of the country and its people, and lack of loyalty as seen by his ditching of his people during the genocide to go and dine with the perpetrating murderers,” Maphosa added.

He also said Ndlovu’s 1984 jibe, that Zapu was a dead donkey, was at the time tantamount to “celebrating the annihilation of the innocent Ndebele people by security forces at the height of Gukurahundi”.

The jibe was never forgotten nor forgiven by many people in the region, which saw Ndlovu being booed routinely during public appearances.

As a result, the late minister was always under pressure to defend himself against the “dead donkey” statement — which he, at one point, said had been misinterpreted by irresponsible journalists.

“First of all, I believe that one would expect an average person to be intelligent enough to know the difference between a metaphor and a statement of fact.

“And if someone thinks that a metaphor is exactly the same as a matter of fact, then that person lives in cuckoo land.

“For starters, I never said PF Zapu was a dead donkey. The statement which I made speaking in Kalanga at a rally in Plumtree was that if anybody thought PF Zapu was going to win the election that year, that person was actually failing to see reality.

“It is a worthless effort if someone is to translate it, as some hired journalists decided to do and made an issue out of nothing,” Ndlovu said then in an attempt to explain the issue away.

An estimated 20 000 people are said to have been killed in the Matabeleland and Midlands provinces when the government deployed the North Korean-trained Fifth Brigade to the two regions, to fight an insurrection.

Unity Day was subsequently set up to commemorate the Unity Accord which was later signed between PF Zapu and Zanu PF on December 22, 1987, and which ended hostilities between the two parties.

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