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Chiwenga, Mnangagwa entangled in massive chrome scandal
28 Apr 2023 at 15:19hrs | Views
COMPANIES linked to President Emmerson Mnangagwa and Vice-President Constantino Chiwenga received US$3 million from South African chrome miner Zunaid Moti following a US$120 million deal signed between the tycoon and the President's adviser Kuda Tagwirei in November 2017, an investigation by The Sentry published this morning reveals.
The chrome mining deal was signed on 17 November, while the military coup which toppled former president Robert Mugabe was unfolding.
The Sentry is an investigative and policy organisation that seeks to disable multinational predatory networks that benefit from violent conflict, repression, and kleptocracy.
Launched in 2016, The Sentry produces hard-hitting investigative reports and dossiers on individuals and entities connected to grand corruption and violence.
Moti, a businessman who is fond of fast cars, cigars and private jets, is a well-known South African wheeler-dealer.
He acquired 70% of African Chrome Fields (ACF), a chrome mining company in Kwekwe, in 2014.
Moti quickly manouevred and established relations with the politicians and the military, resulting in ACF forming a joint venture with the Zimbabwe Defence Forces (ZDF) in 2015. Chiwenga was the ZDF commander at the time.
He also employed then-Vice President Emmerson Mnangagwa's son, Emmerson Junior, as a consultant, paying him as much as US$10 000 per month. Emmerson Jr normally represents his father's business interests.
In recent times, Mnangagwa has been travelling with Emmerson Jr or ensuring he takes part in vital meetings including where government business is addressed.
In January, Emmerson Jr attended a high-level State House meeting of Zimbabwe's top government officials and the visiting Belarusian delegation led by the eastern European country's autocratic leader, Alexander Lukashenko.
Mnangagwa travelled to Equitorial Guinea with Emmerson Jnr amid concerns he was pursuing personal family business interests in February. Tagwirei also travelled with Mnangagwa.
Moti also brought in Mnangagwa through businessman Lishon Chipango, who indirectly owned shares in ACF via Spincash Investments, a Moti Group holding company that held the remaining 30% of ACF. Chipango is believed to be Chiwenga's business ally.
The Sentry investigation revealed that after Moti signed a deal withTagwirei, in which Tagwirei paid US$120 million for Spincash's 30% of ACF, a money-moving operation in which Moti's companies paid US$130 million in 595 installments to a mix of established firms, companies whose records are missing, and politically linked entities in Zimbabwe followed.
"In December 2017 and January 2018 the payments included $1 million to Mnangagwa's farm and $2 million to a company controlled by Chipango and someone reported to be
Chiwenga's niece. In a separate commercial transaction in February 2018, ACF also paid $100 000 to a senior judge, Justice George Chiweshe, as part of a wider deal to mine chrome in concession areas controlled by a firm he chaired," The Sentry says.
Moti's initial plans for ACF, according to the report, was to mine and export raw chrome ore to be processed through his South African furnaces, while also building a new plant in Zimbabwe's Midlands province, so that more "beneficiation"-value-added processes- could take place inside the country.
"In pursuit of this two-pronged strategy, ACF benefited from valuable tax and regulatory decisions, such as when then-Vice-President Mnangagwa persuaded the cabinet to lift the raw chrome export ban in 2015," the report reads.
"ACF and its joint venture with the military - Zimbabwe African Chrome-submitted a combined application for National Project Status (NPS), which allowed them to import capital goods duty-free."
ACF also obtained duty-free chemical imports, an exemption from indigenisation laws, and central bank exchange control authorisation to "set-off" revenue against costs in Moti Group cross-border transactions.
"In 2016, Moti requested Mnangagwa's help in obtaining an exemption on paying duty on diesel, offering to supply 10 000 litres per month to the police, army, and Zanu PF in Midlands province. At the time, some of these concessions - including the successful request for duty-free diesel - were criticised by Parliament and by Mnangagwa's political enemies."
The Sentry also reports that Moti attempted to use his close relationship with Mnangagwa to acquire a Zimbabwean diplomatic passport "so that he would not have to reveal details of his chrome processing techniques in South Africa", but the attempt was unsuccessful.
"However, Moti won a long list of concessions between 2015 and 2019, when ACF had business relationships with Mnangagwa's son and Chiwenga's business associate, and many of these lapsed after 2019, when Moti reportedly fell out with Mnangagwa. The Moti Group said that these concessions were designed to raise foreign direct investment and were available to other firms and that ACF did not receive favourable treatment," the report reads.
"The joint venture with the ZDF was to mine chrome on military-owned concessions, but the project never took off," Moti told The Sentry.
When Spincash received Tagwirei's US$120 million in installments, Spincash and ACF began moving the money over several months, including to former ICT minister Supa Mandiwanzira and then High Court judge president George Chiweshe.
"The company that owns Mnangagwa's farm, Pricabe Enterprises, received $1 million in December 2017, while $2 million went to Cosmotex Investments, controlled by Chipango and Evelyn Chakuinga, reportedly Chiwenga's niece, in two $1 million transactions in December 2017 and January 2018. Chakuinga, Chiwenga, Mnangagwa, and Pricabe did not respond to requests for comment," the report reads.
"In January 2018, another $500 000 went into a joint property investment with a company owned by Supa Mandiwanzira, a businessman who was then the information, communication and technology minister."
Mandiwanzira told The Sentry the property investment was part of a wider - eventually fruitless - deal to mine chrome on concessions legitimately obtained in purely commercial transactions by Mandiwanzira's firms. He said although he was a minister, there was no conflict of interest, as his ministry did not regulate mining or environmental matters.
"ACF paid Chiweshe $100 000 in February 2018 as part of ultimately unsuccessful negotiations to mine chrome on concessions obtained by a firm Chiweshe chaired, Overseas Trends Resources (OTR). Chiweshe," the report reads.
The US$1 million payment to Mnangagwa's farm-which has echoes of the unexplained cash found at South African President Cyril Ramaphosa's farm-has still not been adequately explained.
The chrome mining deal was signed on 17 November, while the military coup which toppled former president Robert Mugabe was unfolding.
The Sentry is an investigative and policy organisation that seeks to disable multinational predatory networks that benefit from violent conflict, repression, and kleptocracy.
Launched in 2016, The Sentry produces hard-hitting investigative reports and dossiers on individuals and entities connected to grand corruption and violence.
Moti, a businessman who is fond of fast cars, cigars and private jets, is a well-known South African wheeler-dealer.
He acquired 70% of African Chrome Fields (ACF), a chrome mining company in Kwekwe, in 2014.
Moti quickly manouevred and established relations with the politicians and the military, resulting in ACF forming a joint venture with the Zimbabwe Defence Forces (ZDF) in 2015. Chiwenga was the ZDF commander at the time.
He also employed then-Vice President Emmerson Mnangagwa's son, Emmerson Junior, as a consultant, paying him as much as US$10 000 per month. Emmerson Jr normally represents his father's business interests.
In recent times, Mnangagwa has been travelling with Emmerson Jr or ensuring he takes part in vital meetings including where government business is addressed.
In January, Emmerson Jr attended a high-level State House meeting of Zimbabwe's top government officials and the visiting Belarusian delegation led by the eastern European country's autocratic leader, Alexander Lukashenko.
Mnangagwa travelled to Equitorial Guinea with Emmerson Jnr amid concerns he was pursuing personal family business interests in February. Tagwirei also travelled with Mnangagwa.
Moti also brought in Mnangagwa through businessman Lishon Chipango, who indirectly owned shares in ACF via Spincash Investments, a Moti Group holding company that held the remaining 30% of ACF. Chipango is believed to be Chiwenga's business ally.
The Sentry investigation revealed that after Moti signed a deal withTagwirei, in which Tagwirei paid US$120 million for Spincash's 30% of ACF, a money-moving operation in which Moti's companies paid US$130 million in 595 installments to a mix of established firms, companies whose records are missing, and politically linked entities in Zimbabwe followed.
"In December 2017 and January 2018 the payments included $1 million to Mnangagwa's farm and $2 million to a company controlled by Chipango and someone reported to be
Chiwenga's niece. In a separate commercial transaction in February 2018, ACF also paid $100 000 to a senior judge, Justice George Chiweshe, as part of a wider deal to mine chrome in concession areas controlled by a firm he chaired," The Sentry says.
Moti's initial plans for ACF, according to the report, was to mine and export raw chrome ore to be processed through his South African furnaces, while also building a new plant in Zimbabwe's Midlands province, so that more "beneficiation"-value-added processes- could take place inside the country.
"In pursuit of this two-pronged strategy, ACF benefited from valuable tax and regulatory decisions, such as when then-Vice-President Mnangagwa persuaded the cabinet to lift the raw chrome export ban in 2015," the report reads.
"ACF and its joint venture with the military - Zimbabwe African Chrome-submitted a combined application for National Project Status (NPS), which allowed them to import capital goods duty-free."
ACF also obtained duty-free chemical imports, an exemption from indigenisation laws, and central bank exchange control authorisation to "set-off" revenue against costs in Moti Group cross-border transactions.
"In 2016, Moti requested Mnangagwa's help in obtaining an exemption on paying duty on diesel, offering to supply 10 000 litres per month to the police, army, and Zanu PF in Midlands province. At the time, some of these concessions - including the successful request for duty-free diesel - were criticised by Parliament and by Mnangagwa's political enemies."
The Sentry also reports that Moti attempted to use his close relationship with Mnangagwa to acquire a Zimbabwean diplomatic passport "so that he would not have to reveal details of his chrome processing techniques in South Africa", but the attempt was unsuccessful.
"However, Moti won a long list of concessions between 2015 and 2019, when ACF had business relationships with Mnangagwa's son and Chiwenga's business associate, and many of these lapsed after 2019, when Moti reportedly fell out with Mnangagwa. The Moti Group said that these concessions were designed to raise foreign direct investment and were available to other firms and that ACF did not receive favourable treatment," the report reads.
"The joint venture with the ZDF was to mine chrome on military-owned concessions, but the project never took off," Moti told The Sentry.
When Spincash received Tagwirei's US$120 million in installments, Spincash and ACF began moving the money over several months, including to former ICT minister Supa Mandiwanzira and then High Court judge president George Chiweshe.
"The company that owns Mnangagwa's farm, Pricabe Enterprises, received $1 million in December 2017, while $2 million went to Cosmotex Investments, controlled by Chipango and Evelyn Chakuinga, reportedly Chiwenga's niece, in two $1 million transactions in December 2017 and January 2018. Chakuinga, Chiwenga, Mnangagwa, and Pricabe did not respond to requests for comment," the report reads.
"In January 2018, another $500 000 went into a joint property investment with a company owned by Supa Mandiwanzira, a businessman who was then the information, communication and technology minister."
Mandiwanzira told The Sentry the property investment was part of a wider - eventually fruitless - deal to mine chrome on concessions legitimately obtained in purely commercial transactions by Mandiwanzira's firms. He said although he was a minister, there was no conflict of interest, as his ministry did not regulate mining or environmental matters.
"ACF paid Chiweshe $100 000 in February 2018 as part of ultimately unsuccessful negotiations to mine chrome on concessions obtained by a firm Chiweshe chaired, Overseas Trends Resources (OTR). Chiweshe," the report reads.
The US$1 million payment to Mnangagwa's farm-which has echoes of the unexplained cash found at South African President Cyril Ramaphosa's farm-has still not been adequately explained.
Source - newshawks
