Search

 

Cablegate: The Goz's Anti-Corruption Show

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

171022Z Mar 04

UNCLAS HARARE 000460

SIPDIS

SENSITIVE

STATE FOR AF/S AND AF/EX
NSC FOR SENIOR AFRICA DIRECTOR JFRAZER
USDOC FOR AMANDA HILLIGAS
TREASURY FOR OREN WYCHE-SHAW
PASS USTR FLORIZELLE LISER
STATE PASS USAID FOR MARJORIE COPSON

E. O. 12958: N/A
TAGS: ECON EINV ETRD PGOV ZI
SUBJECT: The GOZ's Anti-Corruption Show


1.(U) Summary: The Reserve Bank's (RBZ) much ballyhooed
anti-corruption campaign has now shut down one large bank
and a smattering of marginal institutions while pursuing
several hundred individuals. Although the RBZ has
dredged up genuine instances of impropriety and
embezzlement, it has mostly acted against holders and
facilitators of undeclared foreign accounts and not yet
against political leaders. This is part of the RBZ's
latest and misguided attempt to destroy the parallel
currency market. End summary.

Uneasiness Over Vingirai and Ncube Charges
------------------------------------------
2. (SBU) So far, RBZ investigators have raised charges
against four significant players: businessmen Philip
Chiyangwa and James Makamba as well as Intermarket's
Nicolas Vingirai and Barbican Bank's Mtuli Ncube.
Chiyangwa and Makamba were successor generation ZANU-PF
upstarts aiming to leverage their political influence
into commercial endeavors. Many Zimbabweans - including
older ZANU-PF politicos - seemed to rejoice at their
imprisonment. Reactions to charges against Vingirai and
Ncube have been more conflicted. (Intermarket is a large
bank, while Barbican was only launched as a commercial
bank last year.) Both Vingirai and Ncube were founders
and CEOs of their banks, prominent businessmen who served
as role models and financiers for emerging black
entrepreneurs. Those who liked and respected the two
have been pained to see them flee the country.

3. (U) In addition, the RBZ has pursued a host of tiny
financial institutions - such as Trust, NMB and ENG - as
well as several hundred individuals. In some cases, the
RBZ seems to have unearthed evidence of malfeasance,
perhaps best epitomized by Chiyangwa's large collection
of fancy cars. In most cases, however, the RBZ is
charging individuals and financial bodies with
externalization of assets. Ultimately, this is
selective and opportunistic enforcement, since almost
every large business and businessman has dealt in the
parallel market and maintained undeclared foreign
accounts. For example, RBZ Governor Gideon Gono's own
bank, CBZ, had been a prominent parallel market trader.

Comment
-------
4. (SBU) The net effect of the RBZ's energetic anti-
corruption campaign has been negative on two accounts.
First, this economy needs a parallel currency market, at
least until there is sufficient export revenue to fuel
the twice-weekly auctions. By killing the parallel
market while enforcing an overvalued zimdollar at
gunpoint, the RBZ is further damaging the economy by
limiting sharply access to essential foreign exchange.
Second, the RBZ has been too selective in its targeting.
Despite ample evidence of similar "offenses," authorities
have yet to snare a truly "big fish" such as a cabinet
official or Parliament speaker Emmerson Mnangwagwa.

5. (SBU) It is ironic that Barbican's Ncube was a serious
runner-up to Gono as the new RBZ chief. In a parallel
universe, we have no doubt that RBZ Governor Ncube is
contemplating whether to take a call from fugitive Gono
in London.

Sullivan

© Scoop Media

 
 
 
World Headlines

 



UN: Visionary ‘Blue Transformation’ Strategy To Enhance Underwater Food Systems

Record levels of fisheries and aquaculture production are making a critical contribution to global food security, the UN Ocean Conference under way in Lisbon, Portugal, heard on Wednesday...
More>>
Abu Akleh Shooting: Fatal Shot Came From Israeli Forces, Says OHCHR
Israeli forces were behind the fatal shooting of Al Jazeera journalist Shireen Abu Akleh in the West Bank - not indiscriminate Palestinian firing - the UN human rights office, OHCHR, alleged on Friday... More>>


Ethiopia: Conflict, Drought, Dwindling Food Support, Threatens Lives Of 20 Million

Hunger is tightening its grip on more than 20 million Ethiopians who are facing conflict in the north, drought in the south and dwindling food and nutrition support beginning next month, the UN food relief agency warned on Thursday... More>>


UN Ocean Conference: Opens With Call For Urgent Action To Tackle Ocean Emergency
With climate change, biodiversity loss and pollution exacting a devastating toll on the world’s ocean — critical to food security, economic growth and the environment... More>>

World Vision: Deeply Concerned For Thousands Affected By Afghanistan Quake
World Vision is deeply concerned about the deteriorating humanitarian situation in Afghanistan in the wake of a powerful earthquake in the early hours of this morning... More>>



Malaysia: UN Experts Welcome Announcement To Abolish Mandatory Death Penalty

UN human rights experts* today commended an announcement made by the Malaysian government that it will abolish the country’s mandatory death penalty and encouraged Parliament to take concrete steps to pass the agreement into law... More>>