President Robert Mugabe is insisting he remains Zimbabwe’s only legitimate ruler and balking at mediation by a Catholic priest to allow the 93-year-old former guerrilla a graceful exit after a military coup, sources said on Thursday.
A political source who spoke to senior allies holed up with Mugabe and his family in his lavish “Blue Roof” Harare compound said Mugabe had no plans to resign voluntarily ahead of elections scheduled next year.
“It’s a sort of stand-off, a stalemate,” the source said. “They are insisting the president must finish his term.”
The army’s takeover signaled the collapse in less than 36 hours of the security, intelligence and patronage networks that sustained him through 37 years in power and built him into the “Grand Old Man” of African politics.
The priest, Fidelis Mukonori, who has been mediating between Mugabe and the generals who seized power on Wednesday in a targeted operation against “criminals” in his entourage, had also made little headway, a senior political source told Reuters.
The army appears to want Mugabe, who has led Zimbabwe since independence in 1980, to go quietly and allow a smooth and bloodless transition to former vice-president Emmerson Mnangagwa. Still seen by many Africans as a liberation hero, Mugabe is reviled in the West as a despot whose disastrous handling of the economy and willingness to resort to violence to maintain power pauperised one of Africa’s most promising states.
A fighter, both literally and figuratively during a political career that included several assassination attempts, Mugabe now appears to have reached the end of the road. With the army against him and the police - once seen as a bastion of support - showing no signs of resistance, force is not an option. Similarly, his support inside the ruling party is crumbling and on the streets of the capital he is loathed.
Zimbabwean intelligence reports seen by Reuters suggest his exit has been in the planning for more than a year.
Mnangagwa, a former security chief and life-long Mugabe confidant known as “The Crocodile” who was axed as vice-president earlier this month, is the key player. According to the files and political sources in Zimbabwe and South Africa, once Mugabe’s resignation is secured Mnangagwa would take over as president of an interim unity government that will seek to stabilise the imploding economy.
Fuelling speculation that that plan might be rolling into action, opposition leader Morgan Tsvangirai, who has been receiving cancer treatment in Britain and South Africa, returned to Harare late on Wednesday, his spokesman said.
Former finance minister Tendai Biti added to that speculation, telling Reuters he would be happy to work in a post-coup administration as long as Tsvangirai was also on board.
“If Morgan says he’s in, I‘m in,” said Biti, who earned international respect during his time as finance minister in a 2009-2013 unity government. “The country needs a solid pair of hands so one might not have a choice.”
South Africa said Mugabe had told President Jacob Zuma by telephone on Wednesday that he was confined to his home but was otherwise fine and the military said it was keeping him and his family, including wife Grace, safe.
Despite lingering admiration for Mugabe among older African leaders, there is little public affection for 52-year-old Grace, a former government typist who started having an affair with Mugabe in the early 1990s as his first wife, Sally, was dying of kidney failure. Dubbed “DisGrace” or “Gucci Grace” on account of her reputed love of shopping, she enjoyed a meteoric rise through the ranks of Mugabe’s ZANU-PF party in the last two years, culminating in Mnangagwa’s removal a week ago.
Zimbabweans, including the Mnangagwa camp and the military, interpreted this as a move to clear the way for her to succeed her husband.
In contrast to the high political drama unfolding behind closed doors, the streets of the capital remained calm, with people going about their daily business, albeit under the watch of soldiers on armoured vehicles at strategic locations.
The European Commission proposes amending the blacklist by adding Ethiopia and removing Guyana from the list. It urges all European banks to enhance due diligence on any money coming from that country.
The European Commission blacklisted Ethiopia for being very risky in money laundering and terrorism financing, urging banks situated in Europe to apply enhanced due diligence on financial flows from the country.
Aiming to ensure proper functioning of the European market, the Commission, in its latest regulation released on October 27, 2017, added the country to the list of high-risk third countries along with Iran, Syria, Yemen and seven other nations.
The new rule will be applicable in 28 European Union member countries upon being approved by the parliament of the Union within twenty days after its release.
“Countries on this list must be subjected to additional counter checks and the ‘know-your-customer’ (KYC) rules- which involves cross-checking the business and identity of clients,” the regulation reads. The high-risk countries, according to the Commission, will pose significant threats to the financial system of the Union.
“Unlike countries under the high-risk non-cooperative list, this won’t bring any problem to the country,” said Berhanu W.Kiros, deputy head of Financial Intelligence Centre, established to combat terrorist financing, money laundering and related matters in the country.
The Commission added Ethiopia to the list of risky countries half a year after the adjustment of the proposal made by the Commission to swap Guyana from the list, for Ethiopia. The European Parliament voted against the list by 392 ballots to 80, with 207 abstentions.
For Ethiopia, it is not a new thing to be listed in a jurisdiction having a deficiency in anti-money laundering and countering terrorist financing. Seven years ago, the country was labelled as a threat to the international financial system by the Financial Action Task Force (FATF) – an intergovernmental organisation, with 37 member countries, founded in 1998 to combat terrorism financing and money laundering globally.
Presently, studies indicate that money laundering is posing a significant danger to the developmental and security efforts of the world. Being a principally informal and cash-based economy, Ethiopia is exposed to terrorism and money laundering activities, the assessment made by FATF reveals.
Realising the effects, Ethiopia’s government had enacted a legal framework eight years ago, although it criminalised money laundering back in 2005. Three years later, it established the Financial Intelligence Centre to oversee the terrorist financing, money laundering and other related matters. Since then, the Centre has been undertaking various measures to fight such acts including directing financial institutions to implement customer due diligence.
Nevertheless, this was not considered adequate by the European Commission that identified the country as a threat to the financial system of the Union. Although Ethiopia has provided a written high-level political commitment to address laundering, the analysis indicates it should be considered as a third-country jurisdiction considering the progress it has made, the Commission’s regulation reads.
For the three-decade experienced macro-economist and policy analyst, this is alarming.
“This shows there is a high amount of illegal capital flight in the country,” he said. “It is a result of lack of transparency and surge in corruption.”
Berhanu replied. “We are striving to get out of the list,” he said. A study by the Global Financial Intelligence revealed that about 26 billion dollars left the country unlawfully between 2004 and 2013. The same reports discovered that Ethiopia loses two billion dollars annually due to illicit financial flows.
But for the macro-economist, working to get out of the list is not a priority.
“Abolishing backdoor contractual agreements and measures to ensure transparency should be taken to combat laundering,” he said.
Credit: (Tesfa News)
The countries of Sub-Saharan Africa have reached a critical juncture. Strained by a collapse in commodity prices and China’s economic slowdown, the region’s growth slipped to 3.4% in 2015 – nearly 50% lower than the average rate over the previous 15 years. The estimated growth rate for 2016 is lower than the population growth rate of about 2%, implying a per capita contraction in GDP.
Sustained economic growth is essential to maintain progress on reducing poverty, infant mortality, disease, and malnutrition. It is also the only way to create sufficient good jobs for Africa’s burgeoning youth population – the fastest growing in the world. As Gerd Müller, Germany’s development minister, noted at a recent press conference, “If the youth of Africa can’t find work or a future in their own countries, it won’t be hundreds of thousands, but millions that make their way to Europe.”
One way to sustain growth and create jobs would be to collaborate on planning and implementing a massive increase in infrastructure investment across Africa. Public infrastructure is particularly important. This includes highways, bridges, and railways linking rural producers in landlocked countries to Africa’s urban consumers and external markets; mass transit and Internet infrastructure to accommodate greater commercial activity; and electricity transmission lines integrating privately financed power plants and grids.
Major regional projects are also needed to knit together Sub-Saharan Africa’s many tiny economies. This is the only way to create the economies of scale needed to increase the export potential of African agriculture and industry, as well as to reduce domestic prices of food and manufactured goods.
While governments in Africa are spending more on public infrastructure themselves, outside finance is still required, especially for regional projects, which are rarely a top priority for national governments. Yet aid from Africa’s traditionally generous foreign donors, including the United States and Europe, is now set to shrink, owing to political and economic constraints.
But there may be a solution that helps Africa recover its growth in a way that Western leaders and their constituents find acceptable. We call it the “Big Bond” – a strategy for leveraging foreign aid funds in international capital markets to generate financing for massive infrastructure investment.
Specifically, donors would borrow against future aid flows in capital markets. That way, they could exploit current low interest rates at home, as they generate new resources. With 30-year US Treasury rates of about 3%, donors would have to securitize only about $5 billion to raise $100 billion. That money could come from the $35 billion in annual official development assistance (ODA) to Africa (which totals about $50 billion) that takes the form of pure grants.
Donors would pass on the interest cost to African countries, reducing their own fiscal costs. For African countries, the terms would be better than those provided by Eurobonds. In fact, as audacious as it may sound, passing on the interest costs to recipient countries could actually bolster their debt sustainability.
According to a study of eight countries by the African Development Bank’s Policy Innovation Lab, a 3% interest rate in US dollar terms would be lower than the marginal cost of commercial borrowings undertaken by several African countries over the last five years. Moreover, far longer maturities and grace periods, compared to market finance, would ease growing pressure on foreign-exchange reserves.
Frontloading aid in this way is not new. Doing so in the early 2000s to finance vaccines saved millions of lives in the developing world. Big Bond resources, managed by the African Development Bank, could be used to help guarantee financing for major regional infrastructure projects that have long been stuck on the back burner, such as the East Africa Railway connecting Tanzania, Rwanda, and Burundi, and a highway stretching from Nigeria to Côte d’Ivoire. Such projects could also be co-financed by private investors.
Moreover, the Big Bond could help to reinvigorate the relationship between donors and African countries. And, as it supports investments with important country-level benefits, it could serve as an incentive for African countries to pursue reforms that increase their absorptive capacity, in terms of choosing and executing public infrastructure investments.
The Big Bond approach represents a much-needed update to the ODA framework – one that supports higher and more sustainable growth in recipient countries, while lowering the burden on donor countries. At a time when aid is under political pressure, perhaps such a bold approach to maximizing the efficiency of donor resources is exactly what the world needs.
By Nancy Birdsall and Ngozi Okonjo-Iweala
Nancy Birdsall is President Emeritus and a senior fellow at the Center for Global Development.
Ngozi Okonjo-Iweala, a former finance minister of Nigeria and managing director of the World Bank, is a distinguished visiting fellow at the Center for Global Development.
Nobody is safe from the rages of Zimbabwe’s First Lady, “Dr. Amai” Grace Mugabe. There was the young South African model Grace lashed with extension cords. 93-year-old President Robert Mugabe’s longtime and usually trusted ally Emmerson Mnangagwa, was next in the firing line: he was sacked because his supporters allegedly booed her at a rally.
The consequences of her vengeance may have led to a coup headed by Zimbabwe’s army chief General Constantino Chiwenga, who is commonly perceived to be Mnangagwa’s protégé. But ex-freedom fighter Mnangagwa has his own presidential aspirations.
Mnangagwa has been exiled from the party in which he has served since he was a teenager. But he is not just skulking in the political wilderness. On arrival in South Africa he issued a statement calling those who wanted him out “minnows”. He promised to control his party “very soon” and urged his supporters to register to vote in the national elections next July.
As if to back Mnangagwa, on November 13 General Chiwenga announced that he and his officers could not allow the “counter-revolutionary infiltrators”, implied to be behind Grace Mugabe, to continue their purges.
Factions and purges
Chiwenga declared that the armed forces must ensure all party members attend the extraordinary Zanu-PF congress next month with “equal opportunity to exercise their democratic rights”. He flashed back through Zanu-PF’s history of factionalism, reminding his listeners that although the military “will not hesitate to step in” it has never “usurped power”. Chiwenga promised to defuse all the differences “amicably and in the ruling party’s closet”.
Although this airbrushed more than it revealed about the party’s rough patches when leadership vacuums appeared, the statement appeared more as a cautionary note than a clarion call to arms. It’s not often a coup is announced before it starts; but once in motion direction – and history – can change. Grace Mugabe may have unleashed a perfect storm and her own undoing.
All the “shenanigans” that have inspired the generals to consider a coup have set the stage for an extraordinary Zanu-PF congress this December instead of in the expected 2019: that is, before rather than after the July 2018 national elections.
This suggests some people were in a hurry to settle the succession issues for the president, who is now showing every one of his 93 years. Maybe Robert Mugabe won’t rule until he is 100-years-old. If not, and members of his family or party wanted to keep their dynasties alive, they had to work quickly lest some similarly inclined contenders are in their way.
These contenders include Mnangagwa and a slew of his “Lacoste” faction consisting of war veterans and the odd financial liberal. The best-known of these is Patrick Chinamasa. This former finance minister tried to convince the world’s bankers he could pull Zimbabwe out of the fire. He was demoted to control cyberspace and then fired. Perhaps he may make a comeback in the wake of the semi-coup.
The pro-Grace faction includes the members of Generation 40, or “G-40”. Many are well over 40. But in Robert Mugabe’s shadow they appear young, as does the 52-year-old First Lady. Without a base in the liberation-war cohort, they resorted to working with the Mugabe couple: sometimes their ideology appears radical, espousing indigenous economics and more land to the tillers.
If the history of their best-known member – the current Minister of Higher Education Jonathan Moyo – is indicative, however, they are pragmatic; or less politely put, opportunist.
But with Grace Mugabe sans Robert, they would have to muster inordinate amounts of patience and manipulation to steer the sinking ship to the shores of stable statehood and incorporate yet younger generations who cut their political teeth as Robert Mugabe’s rule faltered.
Yet the possible plan for the upcoming congress – to create a third vice-president – appears not to move far beyond the cold hands of the old. Phelekezela Mphoko would be pushed to third vice-president status. Grace would be the second vice-president.
The current defence minister, Sydney Sekeramayi would be first vice-president and so, next in line for the presidential palace. He is a quiet but no less tarnished member of the Zanu-PF old guard; especially when one remembers the massacre of thousands of Ndebele people during the Gukurahundi.
When performing the calculus necessary to rectify Zimbabwe’s graceless imbalances, remember that Mnangagwa was perhaps the key architect of the nearly genocidal Gukurahundi, now chronicled in archival detail in historian Stuart Doran’s Kingdom, Power, Glory: Mugabe, Zanu, and the Quest for Supremacy. Among the scores implicated therein are the British, condemned by Hazel Cameron, another meticulous archivist, as exercising “wilful blindness” during what Robert Mugabe has dismissed as a “moment of madness”.
Perhaps it’s no surprise, then, that many are suspicious of Mnangagwa’s relationship with the UK. Many suspect he has been swimming with perfidious Albion for a very, very long time.
Those waters, in the shadow of Mugabe’s heritage, will take a few more generations of hard political work to clear. It hardly seems propitious that a coup, and the same generation that has ruled since 1980, starts it off.