Fundamentals for the Future - Limiting Corruption; & Roy Bennetts article

In this series we are looking at the different areas that are fundamental to the welfare of the societies we live in. Strangely, the number of such topics is not large and you would think that we could all learn from this.

Watching the recent meeting of the Chinese Communist Party, I was impressed with the main theme - getting corruption under control. To emphasize this point they had just decided to sideline one of the new leadership that had been a candidate for national leadership. I contrast that with what happens here and our own horrendous record in this field.

One of the little acknowledged characteristics of the Rhodesian Government was its basic integrity. It is no secret that Ian Smith retired with very little to show for a lifetime of public service. There were others in the ranks that did rather better and I can recall scams over dam sites, public works and contracts and other things - but by comparison with what we have seen in recent years, this was child's play.

In the first decade of Independence, the basic integrity of the State was retained and when corruption was found, those responsible were sidelined and punished. We can all remember 'Willowgate' and the suicide of a Cabinet Minister and the resignation of the then Minister of Education - a pity because he was otherwise an excellent Minister, perhaps the best we have ever had. But after that, little real action and from then onwards it was downhill all the way with the 'fish rotting from the head'.

Yesterday I watched a programme on a TV station where it was stated that Africa loses an estimated $140 billion a year to corrupt practices. That is more than $250 per capita per year - enough to feed the entire population of Africa. This sum vastly exceeds total aid to Africa which runs at about $40 billion a year for the Sub Sahara region. It represents an astonishing 15 per cent of the total estimated GDP of the entire continent.

Here in Zimbabwe corrupt practices takes many forms. Perhaps the most criminal were the use of the Reserve bank and exchange and price controls - all nominally meant to protect the real interests of the country but in effect being hijacked by a small, politically connected elite. Until 2008 corruption took many forms. First the State took over a third of all foreign exchange receipts lodged with the Reserve Bank. In return they deposited local dollars at the official exchange rate, in effect worthless currency, into the accounts of the people generating the foreign exchange.

By these means the State had access to about US$1,5 billion a year, virtually for nothing. These hard currency resources were then used to buy luxury vehicles, make hard currency allocations to politically connected people in return for worthless local dollars bought on informal markets at market exchange rates which were a tiny proportion of the official rates. The printing of money to make these transactions possible, eventually led to the near total collapse of the economy under the weight of 240 million per cent inflation. In turn this inflation destroyed the private savings and cash capital of the entire nation.

A State monopoly importing liquid fuels siphoned off at least 10 cents a litre on fuel imports - all of it banked outside the country. On imports of 150 million litres a month this was $15 million or $180 million a year. Then there was NSSA - collecting 6 per cent of the salaries of all workers for their pensions and workers compensation. This was worth at least $200 million a year. When we took it over in 2009, there was less than $200 million in assets left in the Fund, accumulated over the previous 23 years; some $3 billion in workers social savings had disappeared.

There were many other similar examples of State sponsored looting of local assets, but by any measure, through these 'macro' corrupt practices, Zimbabwe was losing at least $2 billion a year up to 2008. If we add into this all the corrupt deals done over State contracts, defense purchases and the rest, corrupt losses must have been nearly $3 billion a year - a huge sum for a country with a GDP of about $10 billion.

After 2008, having lost control of all of the above sources of funds to the MDC, the Zanu PF elements in the inclusive government took control of the diamond and gold trade. The diamond deals involved the output from the Marange fields taken over by force in late 2008 and the gold deals involving the production of perhaps as much as 10 tonnes of gold a year from local small scale miners. By my own estimates, the diamond sales run to as much as $4 billion a year. The Minister of Mines admitted $2 billion in 2011 and it must be at least double that. Gold sales must be running at $500 million a year. Nearly all of these revenues disappear. The diamonds are flown out of the country and gold finds its way to the Rand Refinery in Johannesburg where we now contribute 70 per cent of its turnover. Once refined, the gold disappears.

You do not need to be a genius to see where some of this money is going. Harare is awash with luxury cars and you can see even new Rolls Royce's on the streets as well as all other luxury models. Drive around the country and look at the houses going up - many covering over 2000 square meters. Some with tennis courts on their roofs, indoor heated swimming pools, elevators. The trade deficit is nearly $4 billion - but no one gives us credit, it's all cash, where does this extra money come from? At least some of the corrupt money here comes home.

You simply cannot develop a country carrying this sort of burden, no country can. If we cannot get it under control, we will always be poor. Remember that on top of all this, we pay taxes - at least another 25 to 30 per cent of total GDP. How in fact we can still be standing up and functioning is a tribute to our innovative and energetic private sector and the wealth under our feet. If we can stop this boat leaking, believe me we can show the world a thing or two about growth.

Eddie Cross
Harare 16th November 2012


Distinguished guests, ladies and gentlemen-
I am going to keep my comments very brief. Over the last decade, just about everything that can be said about Zimbabwe has been said. I am not here to scrape around and present you one or two pieces of trivia that you may not have heard before. Neither am I here to draw an intricate analytical picture of what could happen in the next 12 months. Rather, I want to point to what I believe is the basic truth about Zimbabwe, but one that is increasingly forgotten amidst all the background noise. This background noise often reaches such levels that we forget what lies in the foreground. My message is a simple one: there needs to be a clean break with the past in Zimbabwe-and very soon-or else the country will be a permanent basket case akin to the Democratic Republic of Congo or the Central African Republic, or any of the other forgotten and forsaken backwaters in Africa, distinguished only by occasional atrocities and marked by the utter, grinding poverty of their inhabitants.

We are, of course, already a basket case, but the sense that this is permanent is becoming ever stronger. I reject the notion that Zimbabwe can evolve toward democracy and prosperity. That is the fallacy that has been peddled by many politicians in Zimbabwe and accepted by a growing segment of the international community. But, realistically, what are the grounds for such expectations? I put it to you that nothing much has changed in Zimbabwe since the last elections in 2008, barring the end of hyperinflation. It was a one-hit wonder that has removed the intense desperation of economic life, yet it has not changed the fundamentals. The desperation is there still; our industrial and agricultural capacity remains derisory. Our prospects for substantial domestic growth or foreign direct investment remain pitiful as long as corrupt ZANU PF functionaries pedal the lunacy of Crony Indigenization Yet I am not going to focus on economic measures of our health. They, too, are just a symptom of a deeper and more serious illness. We have not yet rid ourselves of the cause of these problems-first and foremost, Robert Mugabe's Zanu (PF). They are still in control of the instruments that have steered Zimbabwe since independence in 1980-the army, the police, the air force, and the intelligence organisation. The optimists among us point to the decline in

political violence, the divisions in Zanu (PF), the ageing of that party's war veterans, and so on and so forth. These arguments have been peddled for years. We must begin to regard such people as false prophets. I prefer to look at the enduring realities. Remember that there was little political violence in Zimbabwe for a full ten years from the late 1980s. Remember that violence has always, almost without exception, declined between elections. Why go to the effort of beating and killing people when power is not at stake? Remember, too, that there have been major fissures within Zanu since the early 1970s. And don't forget that there are any number of clones among the younger generation within Zanu (PF) who are eager to follow in the footsteps of the war vets, notwithstanding the fact that they know no nothing of the colonial period that continues to be the stock-in-trade of Zanu propaganda. White Zimbabweans now make up approximately 0.25 percent of Zimbabwe's population and yet-if Zanu's apologists are to be believed-they constitute about 99 percent of the country's problems. This obsession with race is utterly absurd, and is intended to hide the continuing inept, corrupt ZANU PF machine from reasoned scrutiny. These are the realities of military dictatorship, the rape of our resources, and the bastardisation of our national culture.

It is this last aspect that concerns me the most. Aside from continuing to hold our nation to ransom with guns, and baton sticks, Zanu (PF) have slowly and insidiously infected and corrupted our culture with their own venal disease. From the lowly constable to the political elites-the individuals and institutions that are meant to be the foundations, the bricks and the mortar of any civilised system-have instead become predators. Self-seeking, greedy and lawless, they suck the life out of our people-and our people, in turn, are becoming amoral survivors in this world of dog-eat-dog and rat-eat-rat. If you don't believe me, just go through the border at Beitbridge, a living nightmare of vice and corruption, where officials and touts compete and collude for the spoils of hapless travellers, most of whom are their own Zimbabwean brothers and sisters. And if you are heading north, when you eventually manage to escape that cesspit, you are faced with innumerable roadblocks, where the parasites from our police force fleece you of anything from cash to drinks to personal belongings. Our border posts and our roads are a microcosm of what is happening to our integrity as a people.
The impact of this moral disintegration on the opposition movement is the worst part of it all-and its reversal contains the only hope that our DRC-like trajectory can be halted. It is a fact

that some in my party have joined the ZANU PF GRAVY TRAIN. Having participated in the so-called inclusive, government, some now do exactly what their Zanu counterparts do. They drive the same cars, they buy the same houses, and they dress in fancy suits. Politicians from both parties spend more time doing so-called business deals than anything else. There are regrettably some who have even turned to violence. Change must come from politicians with integrity, who respond to the people's desperate cry for participative, transparent democracy. I truly believe that the window of opportunity could nearly be closed for Zimbabwe. Historically, we will look at the period from 2000 to 2015 as the turning point. Unless we in MDC renew our vision and determination and complete the return to Democratic Normalcy in the next three or so years, it might be too late. There will be no new Zimbabwe. I am not predicting an apocalypse. That is quite possible, but it's equally likely that Zimbabwe will degenerate into a Somalia. It will be just be another perennial slum in Africa, a shantytown, a bantustan where the dream of the citizens extends no further than emigration. The privileged few will gorge themselves, on the scraps. In practical terms, MDC and Civil Society must drive Zanu (PF) from power and find enough leaders who will put the country before themselves. We who began MDC as a Broad Based movement -- must now renew ourselves. We must find

ways of uniting and working with each other. We must re direct ourselves to give it a last, all-out push toward our original objectives. We used to know what our objectives were. They remain the objectives of the majority of Zimbabwean citizens. The evolutionary strategic approach toward co-operating with a ‘reformed' ZANU-PF is a pipedream. One example of the myth of a ‘reformed' ZANU-PF and there are many, is to consider the shameful attacks every Sunday on Anglican parishioners beaten and harassed by ZANU-PF as it terrorizes institutionalized Christian denominations. This is a deliberate strategy of theirs. Have we heard any so-called heavyweight ZANU-PF functionaries denounce this disgusting behavior? Not a chance.

I'm not really surprised that the diplomatic communities have latched on to this muddled concept. Western and regional countries are busy with their own problems, and are tired of seeing the same old B-grade Zimbabwe movie over-and-over again. And, at the end of the day, they don't have to live in Zimbabwe. If evolution turns out to be a Somalian mirage, what do others really care? But us Zimbabweans need to be real. If we don't get it right-and quickly-we are facing a future of enduring squalor and oppression. Period.