Cablegate: Delta Corporation: Financing Its Own Interests

This record is a partial extract of the original cable. The full text of the original cable is not available.




E.O. 12958: N/A

1. Summary. In a new development, local powerhouse Delta
Corporation (which, coincidentally, owns several breweries)
has reportedly announced a Zim $10 billion initiative
(approximately US $14.5 million at the parallel rate) whereby
it will loan inputs for the production of maize, sorghum and
malting barley to selected farmers. However, while the
publicity has cast Delta as a solid corporate citizen doing
its part to uphold the GOZ's programs, Delta's self-interests
are driving the deal. End summary.

2. According to published reports, Delta Corporation has
announced a joint venture with the GOZ whereby Delta will
loan the equivalent of Zim $10 billion over two growing
seasons to farmers in the form of agricultural inputs. These
inputs will reportedly support the production of 70,000
tonnes of maize, 60,000 tonnes of malting barley, and 20,000
tonnes of sorghum annually. While this has been met with
great fanfare by Minister of Lands, Agriculture and
Resettlement Joseph Made, as well as Minister for Information
and Publicity Jonathan Moyo, as evidence of Delta's support
of agrarian reforms, the details of the transaction give a
different gloss.

3. Delta subsidiaries include United Bottlers (Coca-Cola),
National Breweries, and Chibuku, which produces the local
opaque beer known as "shake-shake." According to published
accounts of the deal, the inputs and support provided by
Delta "will be treated as loans to be netted off against
final prices." Delta further reserves the rights to manage
the program and select which farmers will receive the loans.
Additionally, while the farmers will forward all maize
produced to the Grain Marketing Board (GMB), which by law
controls all movements, sales and purchases of maize within
the country, Delta has requested an "undertaking and
guarantee" that for as long as maize remains a specified
commodity under the control of the GMB, Delta will be
guaranteed its quota -- with only the surplus to be
distributed to other buyers. If this deal takes place as
agreed, Delta will thus have provided loans to selected
farmers (with their loan repaid by skimming off the first cut
from the produce) who will grow the agro inputs required for
the operations of Delta's subsidiaries.

4. Comment. One local economist notes that this is actually
an expansion of a previous program which Delta has been
operating for the past 12-15 years. Historically, Delta has
preferred to grant malting barley, hops, and grain inputs to
"captive farmers," who then provide inputs for Delta's
various breweries. According to this economist, the dollar
value of the program has increased, but this has much more to
do with inflation than with increased hectarage.
Additionally, he believes that Delta is taking the
opportunity to "make a virtue out of a necessity" by publicly
announcing the program in this fashion. While it is true
that the increase of maize inputs is a new initiative,
Delta's motivations are based much less on altruism and more
on protecting its bottom line. End comment.

© Scoop Media

World Headlines


Syria: Economic Decline, Rising Hunger And Surging Humanitarian Needs

Syria’s fragile economy has “suffered multiple shocks” over the past 18 months, with its currency plummeting and joblessness swelling as people struggle to cover their basic needs, the UN Emergency Relief Coordinator told the Security Council ... More>>

OECD: Final Quarter Of 2020 Shows Continued Recovery In G20 International Merchandise Trade

G20 international merchandise trade continued to rebound in the fourth quarter of 2020 ( exports up 7.2% and imports up 6.8%), following the sharp falls seen in the first half of 2020, as lockdown measures affected trade globally. Although growth ... More>>

UN Report: Civilian Casualties Surged After Peace Talks Began In Afghanistan

Monitoring by the UN Assistance Mission in Afghanistan, UNAMA, and the UN Human Rights Office has revealed that despite a drop in civilians killed and injured overall in 2020 there was a rise in civilian casualties following the start of peace negotiations ... More>>

Focus On: UN SDGs

2021: Critical Year To ‘reset Our Relationship With Nature’ – UN Chief

During this time of “crisis and fragility”, the UN chief told the United Nations Environment Assembly on Monday that human well-being and prosperity can be vastly improved by prioritizing nature-based solutions. Painting a picture of the turmoil ... More>>

Paris Agreement: UN Secretary-General António Guterres To Mark U.S. Reentry With Envoy For Climate John Kerry

Watch live at UN Secretary-General António Guterres will join U.S. Special Presidential Envoy for Climate John F. Kerry at an event marking the United States’ reentry into the Paris Agreement this Friday. The discussion with the Secretary-General ... More>>

WeBeliev: Scoop In Conversation With Abhishek Sinha, Founder Of WeBeliev, An NZ Crowdfunding Platform

WeBeliev supports 17 SDGs, launching sector specific campaigns every month Q. What is WeBeliev and why did you start it? A. WeBeliev is a Singapore-registered crowdfunding platform aimed at fundraising for all the 17 Sustainable Development Goals (SDGs) ... More>>