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Cablegate: Goz Forex Crusade Snags Finance Minister

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

UNCLAS HARARE 000702

SIPDIS

SENSITIVE

STATE FOR AF/S
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 PGOV ZI
SUBJECT: GOZ Forex Crusade Snags Finance Minister

Ref: 03 Harare 2140

1. (SBU) Summary: With the detention of Finance Minister
Chris Kuruneri over the weekend, the GOZ's witch hunt
against foreign exchange externalizers reached a new
level. Kuruneri is the GOZ's latest pretext for blaming
the country's economic demise on parallel market trading
and foreign accounts, rather than its own policies. End
Summary.

2. (SBU) For over a month, the South African Sunday Times
has been embarrassing the GOZ by reporting of Kuruneri's
new 8-bedroom R$ 30 million beachfront Cape Town getaway.
This has put the Finance Minister in the surreal position
of defending himself against a repressive Foreign
Exchange Control Act that his ministry helped create, but
that he - and nearly every affluent Zimbabwean - has
violated. Ostensibly, the GOZ is charging Kuruneri not
because he acquired millions of U.S. dollars through
graft, bribe or other corruption, but because he invested
in a foreign country without subjecting funds to official
exchange. Underscoring the heavy-handed nature of the
weekend imprisonment, the GOZ is also charging Kuruneri
with the benign offense of possessing a Canadian
passport. (GOZ law does not recognize dual nationality.)

3. (SBU) Comment: We are concerned about the selective
enforcement of the Foreign Exchange Control Act. Using
it to bring down one of many allegedly corrupt ministers
does not make the legislation or the GOZ's tactics less
repressive. If Kuruneri deserves sanction or
prosecution, it is probably for graft and abuse of
privilege rather than foreign investment. While nearly
every Zimbabwean motorist relied on black market fuel
last year, the Government similarly imprisoned political
enemies for purchasing fuel outside official (at the
time, nonexistent) channels. By GOZ cabinet standards,
Kuruneri was a relative moderate who even spoke out
publicly last year against a proposal from hard-line
Agricultural Minister Joseph Made (ref). Now he is the
latest victim in the GOZ's clumsy attempt to demonstrate
that forex speculation destroyed the economy and that the
Government is weeding out corruption.

Sullivan

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