HomeLocal NewsThe good, the bad and ugly of 2014

The good, the bad and ugly of 2014

THE year is once again coming to a close with events that would make another blockbuster film in the league of legendary director Sergio Leone’s The Good, the Bad and the Ugly.

Chris Muronzi

From shocking salaries, company closures, business deals, International Monetary Fund (IMF) engagement, President Robert Mugabe’s stinging attacks on his Information minister Jonathan Moyo, Grace Mugabe’s political tsunami, Chinese and Russian deals, former vice-president Joice Mujuru’s political problems to Mugabe toppling and assassination plots and the Zanu PF congress drama, the year 2014 was characterised by some sprinkles of good news, bad experiences and ugly events.

The good
January: At the request of Zimbabwean authorities, the IMF approves a six-month extension of the country’s Staff-Monitored Programme (SMP) — an informal and flexible instrument for dialogue between the IMF staff and a member state on its economic policies — to allow time for the national authorities to strengthen their policies and deliver on outstanding commitments.

The SMP was approved by the IMF management in June 2013 for the period April–December 2013. During the October 2013 annual meetings of the IMF and the World Bank, Zimbabwe’s government, after the July 2013 general elections, reiterated its commitment to the SMP and to the process of re-engagement with the IMF and with other multilateral institutions.

Under the extension, an IMF team visited Harare in March 2014 to assess performance, combining the first and second reviews under the SMP. During the March 2014 visit, the targets for a third review with an assessment date of end-June 2014 were to be set.

Finance minister Patrick Chinamasa visits China looking for money and investment, although he returns home empty-handed;
February: Mugabe returns to work after his annual break with hopes that he would focus on economic issues.

March: An IMF staff mission, led by Alfredo Cuevas, meets with Zimbabwean authorities in Harare during March 12-26, 2014, to hold discussions on the 2014 Article IV consultation and the combined first and second reviews under the SMP.

Former CBZ Holdings CEO John Mangudya appointed Reserve Bank of Zimbabwe (RBZ) boss, a job he was to start in May;
June: The IMF executive board concludes the Article IV consultation with Zimbabwe.

IMF directors took note of the staff’s assessment that the real exchange rate is overvalued. They underscored the importance of addressing structural bottlenecks to boost competitiveness and promote a sustainable external position, and highlighted the need to improve the business environment and basic infrastructure.

Directors also saw a need to reduce uncertainty regarding the indigenisation policy, including in the financial sector, to avoid deterring investment. They urged the authorities to fully implement the recent measures to boost transparency in the diamond sector and to modernise mining legislation;

July: Government sends a Letter of Intent and a Memorandum of Economic and Technical Memorandum of Understanding of Zimbabwe to the IMF. The document, which is the property of Zimbabwe, describes the policies that it is implementing in the framework of the SMP.

IMF management completes first and second reviews of the SMP.

IMF issues its Article IV consultation staff report on Zimbabwe, a press release and statement by the executive director for Zimbabwe. About a week later it also issues the first and second SMP reviews report.

Chinamasa and his Mines counterpart Walter Chidhakwa visit Moscow to court investors;

August: Former Barclays Bank boss Bob Diamond’s Atlas Mara completes the acquisition of BancABC’s parent company and African Development Corporation in the first step towards realising its dream of becoming a giant financial services group in sub-Saharan Africa.

Mugabe visits China and signs “mega deals” which are, however, subject to feasibility and bankability studies;

September: Russia and Zimbabwe sign a US$3 billion deal to jointly mine platinum in the world’s third largest platinum producing nation. The deal is, however, shrouded in secrecy despite an exclusive story in the Zimbabwe Independent trying to dig out and explain the nitty-gritties;

October: A five-member business delegation from the United Kingdom arrives in the country for the first time in nearly 20 years for a three-day working visit to engage government and the business community.

The European Union lifts its 12-year suspension of direct financial aid to Zimbabwe, imposed after accusations of rights abuses by Mugabe’s administration;

November: The Welshman Ncube-led MDC and the Tendai Biti-led MDC Renewal formations, which both split from the mainstream party led by former premier Morgan Tsvangirai, form an alliance, raising hopes among pro-democracy activists of a grand coalition against Zanu PF rule;

December: Emmerson Mnangagwa and Phelekezela Mphoko appointed co-vice-presidents.

The bad
January: Three unnamed banks said to be struggling and under RBZ surveillance.
Chinamasa returns empty-handed from China where he wanted investment and money;

February: Mwana Africa chairman Mark Wellesley-Wood is sacked amid suspicion he was an agent for hostile take-over;

Mugabe returns to work, but starts globe-trotting to Singapore, Malawi and other countries ignoring the economy and other urgent problems.

Tokwe-Mukosi flood disaster, 60 000 people affected. Mugabe fails to visit victims;

March: The IMF warns the macro-economic environment is expected to remain challenging in 2014, and the outlook is for continued moderate growth;

June: The Reserve Bank of Zimbabwe (RBZ)’s Registrar of Banking Institutions cancels Capital Bank’s licence. A total US$30 million in public funds and about US$50 in National Social Security Authority money lost.

Non-performing loans (NPLs) rise from 15,9% in December 2013 to 18,5%.

Mugabe goes to Bolivia for G77 summit in Santa Cruz, ignoring serious problems at home.

IMF says Zimbabwe’s fragile economic situation is characterised by growth slowdown, a large external deficit, and low international reserves. With risks on the downside, it highlights the need to restore fiscal and external sustainability and reduce financial vulnerabilities. It also emphasises that achieving sustainable and inclusive growth requires determined and comprehensive reforms;

July: Mugabe flies out to Malawi to attend the former British colony’s golden jubilee, even skipping the burial of national hero Stanley Sakupwanya who was a member of his Zanu PF’s politburo. But he was the only foreign head of state in the world who attended the ceremony, leaving the country burning.

IMF says Zimbabwe’s economic rebound experienced since 2009 has ended, with economic growth decelerating in 2013. The external position is vulnerable, with a wide current account deficit, an overvalued exchange rate, and low international reserves. The baseline scenario is marked by sluggish growth in 2014 and over the medium-term, with risks clearly to the downside in the near-term.

Key risks to the outlook include lower-than-programmed tax collections, policy slippages, financial sector stress and global commodity prices. Zimbabwe faces these risks with very thin buffers;
August: Egypt Air suspends its flights to Harare citing viability challenges;

September: Chinamasa revises GDP growth forecast from 6,1% to 3,1%, citing serious economic problems;

October: Trust Bank is placed under provisional liquidation after shareholders withdraw court papers opposing the action.

NPLS rise to 20% by end of October 2014 from 18,5% as the total surges over US$700 million further weighing down the economy. Capacity utilisation tumbles by 3,3% to 36,3%, according to the CZI, showing the economy is in serious trouble;

November: Nelson Chamisa, the then MDC-T organising secretary, loses a bid for the MDC-T secretary-general’s position and is cast out of the party’s supreme decision-making body.

Chinamasa presents the 2015 national budget, exposing a deep fiscal crisis gripping Treasury amid shock revelations that government will spend 92% of revenues in recurrent expenditures, leaving a negligible 8% for capital projects and service delivery.

Chinamasa’s figures show that more than 4 600 companies have closed down since 2000, while over 55 400 lost jobs;

December: The RBZ says the NPLs are dragging the economy down, hence the need to attach stringent measures to would-be borrowers as a way of rebuilding confidence in the financial services sector.

ABC Holdings founding CEO Douglas Munatsi and two other executives have stepped down from the financial group following the banking group’s take-over by an investment company co-owned by former Barclays CEO Bob Diamond and African entrepreneur Ashish Thakkar, pocketing at least US$17 million in cash but nonetheless a loss of experience and skill to the local banking sector.

Chinamasa says government will start retrenching civil servants to rationalise the bloated public service in 2015 as part of measures to reduce the unsustainable wage bill.
Mugabe goes on his annual leave, while the economy and the country burn;

and the ugly
January: Media publishes a shock Premier Services Medical Aid Society (Psmas) salary schedule showing former CEO Cuthbert Dube drawing a basic salary of US$230 000 per month — which rises up to US$500 000 all things considered — heralding what would come to be known as “salarygate”. Dube and board chairperson fired following a public outcry over the scandal.

Former MDC-T deputy treasurer-general Elton Mangoma writes a shocking letter to party leader Morgan Tsvangirai demanding leadership renewal which he says is “an inexorable truth that the party will have to confront lest it is plagued by the same succession conundrum affecting Zanu PF”.

Wrote Mangoma: “Since the outcome of the election, calls for leadership renewal have been made in different quotas and at different platforms. It is my unbending resolve that leadership renewal, at this juncture, could be the only avenue to restoring the credibility of the party lest it risks being confined to history. At a time when confidence is plummeting, there is need for the MDC to freshen up, create fresh impetus and rally its troops to remain united and focused. However, this impetus cannot and will not be created if the leadership status quo is preserved.”

In the letter, Mangoma essentially accuses Tsvangirai of leadership failure, incompetence and recklessness through personal life indiscretions which have tarnished the party’s image.

February: Mangoma’s letter triggers fierce infighting which rocks MDC-T, resulting in him being beaten up at Harvest House, the party’s headquarters. This leads to a split as Tendai Biti comes out fighting, triggering suspensions and counter-suspensions and dismissals and counter-dismissals.

In a sensational rape case RMG End Time Message church leader Robert Martin Gumbura was convicted on four counts of rape and one count of possession of pornographic material and sentenced to 50 years in prison. Ten were suspended on condition of good behaviour.
April: Former Zanu PF secretary for administration Didymus Mutasa says ex-vice-president Joice Mujuru was nominated by Mugabe to lead the party during the 2004 congress and the President made it clear that “the sky is the limit for Mai Mujuru”.

In apparent reference to Justice minister Emmerson Mnangangwa, Mutasa describes those angling to snatch the presidency during the Zanu PF congress in December as “rebels and fools”.

This marks the beginning of a long, hard and dirty Zanu PF succession campaign until congress in December;

June: Mugabe attacks Information minister Jonathan Moyo, describing him as “a counter-revolutionary”, “devil incarnate” and a “weevil” who is “destroying the party from within”. The alarming attack shocks the nation as it was like a bolt from the blue — surprising, sudden and unexpected;

A meeting between Mugabe, Mutasa, CIO director-general Happyton Bonyongwe and Moyo is held to resolve the issue and eventually Moyo survives the brutal attack.

July: “In a political development likely to shake the ruling Zanu PF party to its core ahead of its Youth and Women’s League congresses next month, President Robert Mugabe’s wife Grace is manoeuvring to enter the political fray by occupying the post of Women’s League boss,” the Zimbabwe Independent reported;

August: Ugly scenes mark Zanu PF Youth and Women’s League conferences. Grace enters the fray after being officially nominated by the Women’s League to replace Oppah Muchinguri as new leader;
September: Dirty campaigns ahead of the Zanu PF congress intensify;

Zanu PF legislator Temba Mliswa savages Moyo, Environment minister Saviour Kasukuwere and Mugabe’s nephew Patrick Zhuwao describing them as “gay gangsters” as Zanu PF infighting escalates. This later led to dreadful events of votes of no confidence against Mujuru’s provincial chairpersons allies, starting with Mliswa in Mashonaland West province.

Grace Mugabe graduates with a fraudulent PhD in Sociology at the University of Zimbabwe;

October: Grace begins nationwide campaign rallies and meetings, launching a campaign of innuendo, brutal attacks and character assassination against Mujuru;

Doctors embark on a crippling strike over poor remuneration;
November: Mujuru, Mutasa and Nicholas Goche accused of plotting to topple and assassinate Mugabe as the Zanu PF sucsession power struggle reaches its climax. Demonstrations against Mujuru start, while votes of confidence in Zanu PF provincial chairs heighten amid chaos. Serious internal purges follow as everyday becomes the Night of the Long Knives.

Eleven people, including a pregnant woman and children, died and many more were injured in a stampede after 15 000 people packed a 7 000-seater Mbizo Stadium in Kwekwe for a service by celebrity preacher and self-styled miracle worker, Walter Magaya, of the Prophetic Healing and Deliverance Ministries;

December: Zanu PF holds its congress and Mujuru and her allies are ousted from the party amid high-profile political casualties and turmoil paving way for Mnangagwa and Mphoko.

Interfin recovers only 2% of its NPL book.

Mugabe dismisses Mujuru and eight ministers before reshuffling cabinet and appointing Mnangagwa and Mphoko and some new ministers;
After that Mugabe goes on his annual leave from mid-December to mid-January while the economy and country burn.

Recent Posts

Stories you will enjoy

Recommended reading