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Gumbo defends Zimbabwe Airways deal

18 Apr 2018 at 06:57hrs | Views
As Zimbabweans continue to ask questions on the murky Zimbabwe Airways deal, which for long was said to be a private project until last week when government announced that it was the owner of the airliner, Transport minister Joram Gumbo (JG) sat down with NewsDay's senior reporter Xolisani Ncube (ND)to unpack the deal. Below are excerpts from the interview:

ND: Honourable minister, can you tell us the truth regarding the Zimbabwe Airways' story. People are now confused over the ownership.

JG: Zimbabwe Airways was formed by government in 2012. It was the period Air Zimbabwe was not functioning for about two and half years or so. So therefore the government decided to come up with a new airline. When I joined the Ministry of Transport in 2015, I found the project for Zimbabwe Airways on the cards.

That time, the proposal was now to say we must look for a partner for Zimbabwe Airways or Air Zimbabwe. I perused the proposal and Cabinet approved the proposal I made, that we can look for a partner for Air Zimbabwe.

But because of its debts internationally and locally, no one would want to partner with such a company which is in such a bad state financially. Therefore, I proposed that the debt for Air Zimbabwe and also other parastatals in the ministry, which include CAAZ (Civil Aviation Authority of Zimbabwe) and the National Railways of Zimbabwe, be warehoused by government.

So this became my major project to resuscitate these parastatals. Twelve companies or airlines were identified and I have said before, these included African airlines, Asian airlines and also European airlines like Qatari, Egyptian, Malaysian, Turkish, Kenyan, Ethiopian, Singapore, Chinese there were listed as some of the 12 companies.
My first approach was to contact African airlines and I went to Ethiopian Airlines, who after looking at my story and analysing, said they could not, they were polite to say they would look into it, but they would not want to buy into my idea.

The next point of call was Malaysian Airlines, I discovered that they were under the management of PwC [PricewaterhouseCoopers]. How I got to Malaysian airlines is the issue that brings in the former First Family. We went to Malaysian airlines after consultations with their embassy in the country and we boarded the same aeroplane with former President Robert Mugabe, who was going to Singapore, so he gave us a lift.

When we got to Malaysia, it was myself and the team from Air Zimbabwe, who were going to do the negotiations with me, Air Zimbabwe and CAAZ. I had my legal department from my ministry, I had CAAZ personnel and Air Zimbabwe staff. Simba Chikore was the then chief operating officer for Air Zimbabwe, so, therefore, he was leading that section from Air Zimbabwe.

We got to Malaysia and at the airport, it was arranged that His Excellency Prime Minister of Malaysia Najib Razak knows that the former President was going to pass through his country and, therefore, had arranged to meet the President before he proceeded to Singapore. It is then that we sat in the same big room with everybody, the team from Malaysia and the team from Zimbabwe and we were introduced.

Mugabe then said to the Prime Minister of Malaysia, ‘this is my Transport minister, he is coming to have talks with your minister of Transport regarding the partnerships of your airlines and his airline and the Prime Minister said joking ‘I have planes that are being sold by PwC, if your minister has money, he can buy them'. Then I jumped in and said ‘for how much?' and he said ‘do you have money?' and I responded ‘yes, I have money' and he said ‘give me $70 million and I will give you four planes because I have six planes we are not using and I have asked PwC to sell them because we have had two bad incidents with them, so we don't want them, we are getting rid of them. One was shot down and one just disappeared, so we have parked them. They are fairly new and you can have them if you have $70 million'.

Then I said ‘I am here to negotiate and I will negotiate the purchase of those planes'. The Prime Minister and Mugabe left us, then we went ahead to prepare for our meeting for the following day. The former President proceeded to Singapore and I remained in Malaysia with my team. We started our negotiations the following morning at 9am, now with PwC and we told them we had been offered four planes by the Prime Minister for $70 million. They laughed at us and asked us ‘where do you think you can buy a plane like that? Four planes for $70 million', then we said ‘but this is what your Prime Minister said', and they said ‘we are selling on commission on behalf of Malaysian Airways, so we are not listening to that'.

We argued the whole day and we did not agree. They said they were going to make consultations, which they did with the minister for Transport and they were told that this is what the Prime Minister had said. So they wanted confirmation, which were done and then finally on the second day, we were allowed to negotiate around that figure. The Malaysian Prime Minister said if we were going to pay $70 million, let it be cash. We said ‘we don't have that kind of money we are under sanctions', this is what I said. The PwC guys agreed and we wrote a letter of intent to buy and the negotiations started and we went on and agreed on the price and we agreed on payment plan of $70 million.

Two aircrafts were for $18,5 million each and the other two were for $16,5m each and that was $70 million. We were given times to pay, as the authorities there were also working on the worthiness of the planes, which had not been working for some time. So that was the arrangement. So we came back home and reported to Cabinet that this is what had happened. When they were ready now with the second stage, in the letter of intent, it was agreed that we pay $7m before any other discussion could be done and Dr (John) Mangudya [Reserve Bank of Zimbabwe overnor] paid $7 million on behalf of Zimbabwe.

The most important thing to remember is that we were discussing for Air Zimbabwe not Zimbabwe Airways, we were trying to get the planes for Air Zimbabwe, not for Zimbabwe Airways. That happened and we went to the second stage and the other amount was paid which was equivalent to the $18,5m for the one plane. When that was paid, the Malaysian people started to then look at the plane and they wanted us to go there and assess the planes.

We then told them we wanted the planes rebranded in our colours etc. They invited us to go there and have a feel of the plane, so we went to Malaysia and the flight test was conducted and when we landed back at the Malaysian Airport, the news had gone viral that Air Zimbabwe was buying aeroplanes and then we were advised by PwC that it looked like we might have a problem.

They told us ‘there are people whom you owe money and they are threatening to buy the planes, so they are calling us, as the people who are selling on behalf of Malaysian Airlines. If this is true, then we must impound those planes and have them sold when they are paid for'. We owed the government of German some money and they had gone to court for the forestry farms in Mashonaland Central and some timber farms in Manicaland and some farmers who had won a case against us in Namibia. Germany wanted about $500 million from us, so they were going to impound our planes.

We were advised that ‘what you can do in order to circumvent this problem, you can then form a leasing company, so anybody can lease planes to yourselves or to your country' and then we said ‘OK, that is a very good idea'. So we came back and said ‘this is the problem we are facing and this is the advice we are getting' and former President Mugabe advised us to talk to (Finance minister Patrick) Chinamasa and our legal section here and the then Vice-President (Emmerson) Mnangagwa. So I told them all that was happening and we all agreed, but now, the threat is about sanctions keep these things under wraps so that it doesn't get known by the world, so that's what we did and this is how the Zimbabwe Aviation Leasing Company was formed on the advice of those people who were negotiating.

I am giving you all this information so that you understand where we are coming from. Zimbabwe Aviation Leasing Company was then to be the owner of the planes and then would lease to Zimbabwe Airways.

ND: Who are the directors of Zimbabwe Airways and Zimbabwe Aviation Leasing Company?

JG: The directors for Zimbabwe Aviation Leasing Company are officials from the ministry of Transport and the trustee is Dr Mangudya. And this has always been the case on the formation of what is called Zimbabwean Airways, the officials are the permanent secretary and everybody from the ministry of Transport, the records are there. It has no other person from outside government the person responsible for the payment is Dr Mangudya, who is the trustee of Zimbabwe Airways. So this is how Zimbabwe Airways was then proposed.

Since government had already formed a company, let's not connect Air Zimbabwe with this one. Let's treat it like it's a new entity altogether but which is a government entity which is Zimbabwe Airways and its articles of association and registration is there.

ND: All along, the story has been Zimbabwe Aviation Leasing Company is owned by Diasporans. Where is this story coming from now?

JG: The story is coming from the idea of keeping this information as a secret. We wanted to safeguard our planes from seizure. Just as I have been doing with the National Railways of Zimbabwe and I have constantly said I am now a facilitator. We said this so that we could ensure our properties are not attached over debts. I am happy that the story is now coming out now when we are in the new dispensation. At least, we have opened talks for re-engagement and the risk of seizure is minimal.

Had people interrogated me on the payments and who is paying for these plans, probably I would have failed to shield the deal for so long. I am glad people did not ask that question. The bottom line is that these planes are owned by government. From day one, they have been owned by the government. Nothing had changed. Documents are there to show.

ND: When the aircraft landed, we saw Simba Chikore as part of the team. What was he doing there? Who is he in this project?

JG: Simba Chikore is a Zimbabwean first and foremost, just like you and me. He is the man who is spearheading this project. He has been involved from day one, when he was with Air Zimbabwe, as I told you that this project initially was for Air Zimbabwe and I have explained how we "changed" it to appear like it was a private deal. He was made to resign from Air Zimbabwe in September so that he could concentrate on the project as well as ensuring that it appears the project has nothing to do with government.

We agreed that, as government, we take a silent role so that we could not jeopardise the deal. He was given a budget to work with as Zimbabwe Airways and that budget was approved by the trustee, Dr Mangudya. He was tasked to look for personnel to work with and he has five people working with him. Although we told the public that this was a private deal, Chikore was working with a small budget of $1 million to run around, do the negotiations for the project until all the planes are here.

He has been in and out of the country, taking care of Air Zimbabwe workers whom we had left in Malaysia working on the project. I can tell you this, like him or hate him, Simba Chikore has connections in the aviation industry. He is well knowledgeable of the industry and has enough respect in that sector. As the ministry, we have been working with him assisting in negotiations on this project hence you saw him there.

ND: Questions are that when he came out of the aircraft, he was in full pilot regalia, yet he is not a full pilot. Why?

JG: Let me say this, Simba has enough experience in the aviation sector and he has worked for reputable organisations. He is a pilot and he came in that plane as a pilot together with other pilots. He is the man in charge of Zimbabwe Airways, although he has no contract, but working on goodwill. The plan was that by December 1 last year, we had envisaged that Zimbabwe Airways would be flying to London, while government was sorting out the issues around Air Zimbabwe.

Remember, in 2012, government had made a decision to retire Air Zimbabwe. So I don't know how Cabinet would now deal with the matter. So, on Simba, he is a qualified person who is working on the project as a consultant, although he has never been paid anything.

ND: Now that the planes are here, when are we expecting them to fly and what will happen to Air Zimbabwe.

JG: That is now up to Cabinet. If it so wishes, they can both fly or they can go ahead with its decision made in 2012 to dissolve Air Zimbabwe. But, at the moment, while the re-engagement process is on-going, Zimbabwe Airways will be a stand-alone entity and Air Zimbabwe and stand-alone company. We are yet to have a meeting and find a working solution to this.

I know that Simba has been moving around looking for space and operating papers for Zimbabwe Airways. He is looking for offices at airports and I know that the RBZ governor will have to give Zimbabwe Airways some money for operating licence.

We are now awaiting the delivery of the other plane, which we have paid for in full and the Finance minister has to pay the remainder to make it $70 million. So far, only $41 million has been paid and this is equivalent to two planes. We are also expecting to receive a smaller plane next week for Zimbabwe Airways. The Malaysian government has given us a June 30 deadline to pay and then we shall have the planes in the country. The other was just being refurbished.

ND: We saw the plane which was received written RGM and the public has been speculating that it was a registration for Robert Gabriel Mugabe. Why?

JG: And this is all because we are focusing on trivial issues. The RGM it just a registration which is not related to ownership. It is like you naming your plane as Zimbabwe or Mosi-oa-Tunya. It is just a registration which we opted to use. We said let us write on one of the planes as RGM in honour of the then President Mugabe. Not that he owns the plane, but we were just writing on one of the planes and the other we agreed to have it written as EDM (Mnangagwa), who by then was the Vice-President and the other was to be written as PRM (Phelekezela Report Mphoko), who was also the Vice-President. It had nothing to do with ownership.

Since the other two are not yet paid for, we might decide to change the one we had written PRM to either CGC (Constantino Guvheya Chiwenga) or the other to KDM (Kembo Duggish Mohadi) or something. This has nothing to do with ownership or anything. Let me also say this, I have read some people alleging that Bona Mugabe-Chikore had travelled with Simba to collect the planes. No, we found Bona at Robert Gabriel Mugabe International Airport waiting for her husband who was bringing the plane home. She was just like a number of Zimbabweans who were there ululating at the arrival of the planes. I know people have been mischievously linking her presence and the RGM thing.



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