Cablegate: Govt/Business: At Least They Talk

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

UNCLAS HARARE 001347

SIPDIS

STATE FOR AF/S
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 ETRD EINV PGOV ZI
SUBJECT: Govt/Business: At Least They Talk

1. Summary: The Confederation of Zimbabwe Industries
(CZI) annual conference intimates the GOZ is more willing
to listen to, though not act upon, private sector
concerns. End summary.

Cordial Confrontation
---------------------
2. Government and business repeatedly congratulated
themselves during the Aug 5-6 sessions on a newfound
inclination for discussion. The GOZ's daily Herald
shared this view, proclaiming an end to "mud-slinging
between the two parties." In fact, the GOZ turned out in
full-force for this business congress. Five ministers as
well as the Reserve Bank (RBZ) Governor planned to
address the gathering of some 300 businesspersons at the
Victoria Falls resort town. (The death of Zanu-PF leader
and other unforeseen commitments kept several away.)

3. The two sides did not agree concretely on much. The
GOZ regurgitated familiar polemics, e.g.:

- Trade/Industry Minister Mumbengegwi credited President
Mugabe's so-called war cabinet with turning around the
economic decline. (Comment: Named in August 2002, the
cabinet enacted strict price controls. On the heels of
fast-track land reform, these controls plunged the
country into its deepest ever recession, culminating with
negative-15 percent growth in 2002. Two years on, the
economy is still shrinking.)

- RBZ Governor Gono continued to label exporters
complaining of an overvalued exchange rate "crybabies."

- Trade/Industry Permanent Secretary Katsande insisted
Western sanctions had largely caused Zimbabwe's economic
plight.

This is not the stuff of GOZ moderation or introspection.
However, top officials also listened politely while
speakers and delegates blasted the overvalued currency,
controlled media and ministerial land-grabs. Zimsun CEO
Shingi Munyeza, who heads the country's top tourism
outfit, nearly shouted to roaring applause: "I urge all
A2 farmers [recipients of larger farms during land
reform] to go farm and stop being weekend farmers."

Comment
-------
4. Given how combative government-business relations have
been, such open exchanges hint at progress, albeit
minute. During breaks, many businesspersons commented to
Emboff that this dialogue would not have taken place a
year ago. Both sides have moderated their tone, led by
RBZ Governor Gono for the GOZ and CZI President Anthony
Mandiwanza - a Zanu-PF loyalist - for the business
community. Transforming words to action, however,
there's still an ocean to scale.

Sullivan

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