Opinion / Columnist
Kiya kiya Chinamasa to reschedule government debt repayments but for how much longer!
27 Feb 2015 at 18:13hrs | Views
The hard-up Zimbabwe government, "which has resorted to domestic borrowings to support its budget, is struggling to repay and is scrambling to reschedule some of the debt as it falls due," reported The Source.
It is one thing to have 90% plus unemployed and forced in the informal sector, kiya kiya, but now we have a kiya kiya government too!
Mugabe has given up on the economic recovery, he knows that ZimAsset is dead and as the revenue base continue to shrink as more and more companies close and throw workers on the mountain of unemployed - kiya kiya people do not pay tax or council rates. Minister Chinamasa has been forced to start his own kiya kiya moving pay days, rescheduling debt repayments, etc.
Government departments like ministry of defence have started their own kiya kiya too; soldiers are now forced to take one month leave every other month just to save on food bill.
Mugabe has been making things worse and not better by stepping up on his extravagant spending, he had an extended holiday with his extended family in the Far East costing $12 million, at least, and this weekend he is having a birthday party with 20 000 guest in Victoria Falls, it will cost $5 million at least. All the bills will end up at Minister Chinamasa's desk for him to pay.
Corruption is kiya kiya at a grand scale and these involved, like their counter parts selling air time on their street, they too do not pay tax or council rates. Last week Information Minister, Jonathan Moyo, announce on his twitter page that tax revenue from the sale of Marange diamonds had "dramatically shrunk". Not that the nation had ever receive the true value of the diamonds in revenue.
According to Partnership Africa Canada Mugabe made a cool $2 billion from his share of the looting and plunder of Marange diamonds in 2012 alone compared to a few hundred million paid to treasury as tax that year. Mugabe is not the only Zimbabwean official with a secretive deal with a foreign company, Chinese, Indian, Israeli, Russian, etc. who do the mining and pay him a share in returned for a reduced tax burden. The Army, Police and a number of senior Zanu PF leaders are all in the deal. What Minister Moyo was announcing is that the local tax burden, little as it was already, had been "dramatically shrunk".
Pen East Mining Company is active in Marange and they and their foreign partner there do not pay any local tax. The same arrangement will apply on the platinum deal, no local tax for the first five years at least; the Russians are very pleased, naturally.
The most significant difference between the impoverished street vendor and filthy rich Zanu PF oligarch is the waste; whilst the street vendor will fight for every penny and see to it that nothing is wasted, the latter the exact opposite reckless, extravagant and wasteful with the "there is plenty more where that came from mentality".
In his parliamentary report in 2013 the late Zanu PF MP Chindori Chininga confirmed that no Zimbabwe official knew the quantity and quality of the diamonds being mining and shipped out of Marange. So in their greed and selfishness to keep the Marange bounty to themselves and deny the rest of us a share Mugabe and his cronies have instituted a system that allows their foreign partner whatever they pleased and walk away with the rest.
Yes to Mugabe the individual $2 billion is a fortune. Even if Mugabe and his cronies end up receiving $20 billion when all is said and done; what is $20 billion out of $800 billion the diamonds were valued at?
The parliamentary report showed the foreign companies are operating 24/7; they are mining and shipping out the germs as fast as they could. India has a thriving diamond industry cutting and processing Marange diamonds according to former Vice President Joice Mujuru. Zimbabwe has no such industry.
So out of a potential $ 8 000 billion diamond resource (increased ten-fold if processed local by creating jobs and adding value) the nation will have a misery $20 billion paid to Mugabe and his cronies to show for it all.
And Zimbabwe's oligarch love to squander their ill got fortunes on business ventures that collapse as soon as the loot stop flowing in like Minister Obert Mpofu banking company. With months of the minister losing the job as Minister of Mines and the generous kickbacks from all the corrupt activities in that sectors his multi-million banking company was in trouble.
Others oligarchs like Philip Chiyangwa prefer to spend their loot on luxury cars; he has just taken delivery of a $500 000 monstrous customer-made limousine. He will have very limited use of it given the country's narrow and pot-holed roads! What a waste of money and what makes it all such a criminal waste is that this is happening in a country where 76% are living on less than $200 per month!
Yes Minister Chinamasa, go ahead and reschedule the domestic debts, you are only kicking the can down the road and not just any road a cul-de-sac. You will still need to borrow from new domestic sources to pay the next civil servants' wage bill – you are running out of local companies to borrow from since so many companies are struggling or have already closed. Yes there are millions you could be getting from all the billions of dollars' worth of diamonds being looted and plundered from Marange but even the little you got has "dramatically shrunk". Only the very select few are allowed to benefit from Marange diamonds.
By the way you will still have to pay the reschedule debt plus the interest plus the rescheduling charges.
The Greeks rescheduled their debt for four months; what did you get, six month, a year? The Greek economy is registering some new growth and recovery; the Zimbabwe economy is showing all the signs that it is getting even worse.
Rescheduling debts, moving pay days, forcing people to go on leave, etc.; these are all kiya kiya gimmicks that are not addressing the key causes behind the country's economic meltdown – gross mismanagement and rampant corruption. After decades of kicking the can down the road the regime is now in cul-de-sac; there is no more road left. Minister Chinamasa you are in a very dig hole; stop digging!
The only realistic way to end Zimbabwe's economic meltdown is for the nation to hold free, fair and democratic elections. Mugabe and Zanu PF will have to step down or will be forced out of office; there is no other way.
Source - Wilbert Mukori
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