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Cablegate: Private Schools Attempt to Dollarize Tuition

VZCZCXRO4366
OO RUEHBZ RUEHDU RUEHJO RUEHMR RUEHRN
DE RUEHSB #0767/01 2471444
ZNR UUUUU ZZH
O 031444Z SEP 08
FM AMEMBASSY HARARE
TO RUEHC/SECSTATE WASHDC IMMEDIATE 3370
INFO RUCNSAD/SOUTHERN AF DEVELOPMENT COMMUNITY COLLECTIVE
RUEHAR/AMEMBASSY ACCRA 2253
RUEHDS/AMEMBASSY ADDIS ABABA 2373
RUEHRL/AMEMBASSY BERLIN 0902
RUEHBY/AMEMBASSY CANBERRA 1650
RUEHDK/AMEMBASSY DAKAR 2006
RUEHKM/AMEMBASSY KAMPALA 2427
RUEHNR/AMEMBASSY NAIROBI 4859
RUEAIIA/CIA WASHDC
RUZEJAA/JAC MOLESWORTH RAF MOLESWORTH UK
RHMFISS/EUCOM POLAD VAIHINGEN GE
RHEFDIA/DIA WASHDC
RUEHGV/USMISSION GENEVA 1522
RHEHAAA/NSC WASHDC

UNCLAS SECTION 01 OF 02 HARARE 000767

SENSITIVE
SIPDIS

AF/S FOR G. GARLAND
DRL FOR N. WILETT
ADDIS ABABA FOR USAU
ADDIS ABABA FOR ACSS
STATE PASS TO USAID FOR E. LOKEN AND L. DOBBINS
STATE PASS TO NSC FOR SENIOR AFRICA DIRECTOR B. PITTMAN

E.O. 12958: N/A
TAGS: PGOV PREL ASEC PHUM ZI
SUBJECT: PRIVATE SCHOOLS ATTEMPT TO DOLLARIZE TUITION

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SUMMARY
-------

1. (SBU) Private schools in Zimbabwe began requesting payment
last week in US dollars or British pounds in an attempt to
retain teachers and meet rising educational costs.
Zimbabwean government officials quickly declared the practice
illegal and deployed inspectors t investigate schools and
threaten headmasters wit arrest. The ban is likely to
result in request for discreet donations and alternative
paymentsin fuel or commodities, or possibly the closure of
some schools. More likely, the policy will be canged or
exceptions will be made to the ban.

-------------------------------------------
Privat Schools Attempting to Bill in Forex
------------------------------------------

2. (U) Nearly al private primary and secondary schools
throughot Zimbabwe have begun billing tuition in US dollars
and British pounds in an attempt to retain teachers and meet
rapidly rising school expenses. The practice quickly gained
national attention, as last week, several hundred trust
schools*the equivalent of independent schools in the US*and
religiously-affiliated schools mailed out letters to parents
explaining the change in billing policy. Local independent
press cited tuition ranging between US$300 and US$800 per
term, depending on the school.

3. (U) Previously, tuition had always been billed according
to a fixed schedule, which at current bank transfer rates,
ranges between about US$8 to US$28 per term. Schools found
these fees to be insufficient to retain staff, provide
student meals, and meet utility payments.

--------------------------------------------- -
&Illegal8 Declares ZANU-PF; Deploys Inspectors
--------------------------------------------- -

4. (SBU) The immediate government reaction*voiced by Esau
Ndlovu, the chief of the National Incomes and Pricing
Commission (NIPC)*was to declare the practice illegal and
deploy inspectors to investigate the identified schools. At
the Bishopslea primary school near Harare for example, four
intelligence officers from the Zimbabwe,s Central
Intelligence Office arrived on August 28, ostensibly to
determine if the school was billing in forex, according to a
Zimbabwean parent of an enrolled child. The school, which
was in danger of losing 6 teachers, quickly froze all tuition
collections and is now determining how best to proceed.
Additionally, Raymond Majongwe, director of the Progressive
Teachers Union in Zimbabwe, told poloff that Mugabe,s office
had sent out security details charged with visiting
Harare-area schools and investigating tuition billing
practices.

5. (SBU) During a local news broadcast on August 2, the
Zimbabwean Deputy Minister of Education threatened
headmasters with arrest if their schools were billing in
foreign currency. An American parent of a child enrolled at
the Bishopslea school told us she had spoken with the school
headmaster, who confirmed that heads of school were
exceedingly nervous about the threats and were convening
emergency board meetings.

6. (SBU) The currency restriction may not be universally
applied across private education in Zimbabwe. Majongwe told
us that the police academy in Hatfield (a Harare suburb) was
in fact charging tuition in US dollars.

HARARE 00000767 002 OF 002

--------------------------------------------
Schools Likely to Resort Back to &Donations8
--------------------------------------------

7. (SBU) Should the NIPC remain adamant that billing tuition
in dollars or pounds is in violation of Zimbabwe,s foreign
currency controls, Majongwe believed schools were likely to
resort to discreetly asking parents for &donations8 in hard
currency, or alternatively, requesting payment in fuel
coupons or even food commodities. This has already been a
fairly commonplace occurrence within the private school
community, according to Majongwe. Majongwe cited cases where
children were asked to bring liters of cooking oil or pounds
of sugar and salt, to cover the rising educational costs due
to Zimbabwe,s runaway hyperinflation.

-------
COMMENT
-------

8. (SBU) Strict enforcement of the forex tuition ban could
result in the closure of some schools. More likely, since
many of these schools serve the children of Zimbabwe,s
ruling elites, there will be a change in policy or convenient
exceptions to the ban. The resort to forex tuition by
schools is symptomatic of the increasing dollarization of the
economy as businesses and traders find it more and more
difficult to operate in Zimbabwe,s hyper-inflationary
economy. END COMMENT
MCGEE

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