News Update as @ 1530 hours, Monday 16 February 2015

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The European Union remains a cru-cial development partner to Zimba-bwe which has contributed immensely towards poverty eradication and eco-nomic transformation of the country, a Cabinet Minister said on Monday.

Finance and Economic Development Minister Patrick Chinamasa said this at a function where the EU was extending 234 million Euros (about $270 million) to the Zimbabwe Government under

the 11th European Development Fund (EDF, 2014-2020) to be utilized in var-ious sectors of the economy.

Chinamasa said the event was a signifi-cant step towards normalisation of rela-tions between the EU and Zimbabwe.

“It would be the first time since 2002 that the EU is engaging the Govern-ment of Zimbabwe directly with devel-opment assistance funds being chan-

neled through Treasury and not through NGOs as was the case before,” he said.

“Let me re-affirm Government’s com-mitment to the Zimbabwe–EU co-oper-ation and successful implementation of the NIP," he said.

Chinamasa urged the EU, which has removed economic sanctions on some Government officials and entities, to also remove President Robert Mugabe and his wife Grace from the embargo to foster better ties.

“Zimbabwe Incorporated has a chief executive and as long as the chief executive remains under sanctions our relations remain poisoned and unpro-ductive,” he said. The funds will be utilised under the National Indicative Programme (NIP), a joint framework between the Government of Zimbabwe

and the EU that will guide formulation and implementation of projects funded under the EDF.

About EUR 88 million will be channeled towards the health sector, another EUR 88 million will be directed to the agricul-ture sector while EUR 45 million will be used on governance and institutional capacity building.

Civil society, the national authorizing office and technical services would get EUR 6 million, EUR 3 million and EUR 4 million respectively.

Speaking at the same event, EU ambassador to Zimbabwe Philippe Van Damme said despite political differences of the past the EU was more than ready to normalise relations with Zimbabwe.

He pledged more dialogue and engage-ment with Zimbabwe, which missed out

EU extends $270m to Zim

on the 9th and 10th edition of the EDF due to sanctions imposed on Harare.

“The will and commitment has always been there to search for common strat-egies,” he said.

Van Damme said the EU was ready to provide at least half of the pledged funds this year. The EDF is the main instrument for EU aid for development cooperation with the African, Caribbean

and Pacific Group and is funded with contributions from the EU member states. The NIP is complemented by additional thematic and regional pro-grammes in fields that include trade and

regional integration, peace and security, natural resource management, support to civil society and human rights. -- New Ziana •

Beverage manufacturer Delta Corpora-tion says it did not increase production of sorghum this year since it does not anticipate a substantial rise in beer sales mainly due to the economic challenges the country is facing.

Delta company secretary Alex Maka-mure told New Ziana that they were still assessing the hectares planted this season though the target yields were at 4 to 6 tons per hectare for commercial

and 1 to 2 tons for communal.

“The target output for 2015 is at the same levels as last year as the vol-umes of beer sales are not expected to increase substantially given the state of the economy,” he said.

Delta contracts farmers to grow sor-ghum following the decline in its produc-tion as most farmers shifted to growing cash crops such as tobacco.

Makamure said Delta contracted 27 commercial and 5 000 communal farm-ers to produce sorghum in this cropping season.

He said the company uses about 12 500 tons of red sorghum and 2 000 tons of white and sweet red sorghum annu-ally to produce opaque beer and Eagle larger.

Sorghum is a small grain crop ranked second as a staple cereal crop after maize in Zimbabwe.

It is a drought resistant crop grown mostly in regions 3, 4 and 5 where there is uneven distribution of rainfall.— New Ziana •

2 NEWS

Delta expects beer sales to remain flat

Beverage manufacturer Delta Corpora-tion says it did not increase production of sorghum this year since it does not anticipate a substantial rise in beer sales mainly due to the economic challenges the country is facing.

Delta company secretary Alex Maka-mure told New Ziana that they were still assessing the hectares planted this season though the target yields were at 4 to 6 tons per hectare for commercial

and 1 to 2 tons for communal.

“The target output for 2015 is at the same levels as last year as the vol-umes of beer sales are not expected to increase substantially given the state of the economy,” he said.

Delta contracts farmers to grow sor-ghum following the decline in its produc-tion as most farmers shifted to growing cash crops such as tobacco.

Makamure said Delta contracted 27 commercial and 5 000 communal farm-ers to produce sorghum in this cropping season.

He said the company uses about 12 500 tons of red sorghum and 2 000 tons of white and sweet red sorghum annu-ally to produce opaque beer and Eagle larger.

Sorghum is a small grain crop ranked second as a staple cereal crop after maize in Zimbabwe.

It is a drought resistant crop grown mostly in regions 3, 4 and 5 where there is uneven distribution of rainfall.— New Ziana •

Delta expects beer sales to remain flat

BH24 Reporter

The Zimbabwe Stock Exchange has suspended Meikles Limited from trading with effect from today.

The bourse announced without immedi-ately giving reasons for the suspension. However, sources have said the move is meant to pave way for the ZSE to seek clarification on the hotel group’s latest financials.

There have been reports that the group

published erroneous information with regards the Reserve Bank of Zimbabwe debt.

Meikles reported a $2,8 million loss for the half-year ended September 30 2014 and said it was owed about $90 million by the central bank, a debt which had accrued over the years from as far back as 1998.

But Bikita West legislator, Munyaradzi Kereke, and former advisor to then central bank Governor Gideon Gono

accused the group inflating figures with the intention of manipulating its price on the stock market.

In a parliamentary portfolio committee meeting recently, Kereke said the RBZ debt to Meikles stood at $34,1 million as at December 2008 and could not have ballooned to $90 million as Meikles had stated in its financials.

“Meikles published completely errone-ous information (whose) implications are far much more in the financial sys-

tem than just the numbers.

“They created a stock exchange bubble which is tantamount to fraud. When you artificially present falsehoods on the stock exchange you uplift the stock price or keep it where it is when in effect it was supposed to fall. The stock exchange has been tampered with,” he said.

Questions sent to Meikles had not been responded to by the time of publishing. •

3 analysis3 NEWS

Meikles suspended from ZSE

By Funny Hudzerema

The Food and Agriculture Organisation of the United Nations (FAO) will provide irrigation facilities to more than 2000 families in Manicaland before the end of the year as part of its Smallholder Irri-gation Support Programme which seeks to protect rural farmers from climate change and frequent droughts.

Speaking during a graduation ceremony of irrigation engineers, FAO representa-tive for Zimbabwe David Phiri said the organisation is committed to assisting the Government to construct and reha-bilitate irrigation schemes to increase agricultural production in the rural areas. “FAO has introduced the Small-holder Irrigation Support Programme aimed at improving the rural agricul-ture but Government support is critical. “This will be done through, improving irrigation infrastructure, capacity devel-opment of farmers to practice irrigation farming as a business and strengthen-ing of community-level Irrigation Man-agement Committees,” he said.

A survey conducted by FAO indicated that 70 percent of the population of Zimbabwe live in rural areas that are

characterised by low and unpredictable rainfall patterns.

He said the country’s irrigation system has been affected by lack of funding, sil-tation of local dams and canals and these issues could be addressed to maintain food security. Currently only 61 per-cent (10 000 ha) of total land equipped with irrigation facilities is functional. “We remain committed to addressing capacity gaps through mixed strategies, including development of appropriate technical information, specific studies and professional exchange, provision of material resources for strategic projects implementation and technical backstop-ping of counterparts,” he said.

He also said in 2016 FAO is also plan-ning to train other irrigation engineers to help rural farmers. In a speech read on

his behalf during the same event, Sec-retary for Agriculture Mechanisation and Irrigation Ringson Chitsiko said the Gov-ernment is working on policies which support the irrigation farmers to reduce food shortages in the country.

“The Government is committed to mak-ing the Smallholder Irrigation Develop-ment Programme a success by devel-oping both institutional innovations and enabling policies that can ensure adap-tation of new irrigation technologies in the agriculture sector,” he said.

He also said agriculture productivity is being affected by frequent droughts and effects of climate change leading to crop failure hunger and poverty hence irrigation development and training is critical. •

4 AGRICULTURE

FAO irrigation programme to benefit more than 2000 rural farmers by year end

55 AGRICULTURE

The Tobacco Industry and Marketing Board (TIMB) says the 2015 marketing season will begin on March 4 this year at auction floors, while contract sales commence the following day.

The tobacco marketing season, which traditionally opens mid-February, was delayed as the crop was still at different vegetative stages.

The TIMB said three auction floors, namely the Tobacco Sales Floor, Boka Tobacco Auction Floor and Premier

Tobacco Auction Floors had been licensed to conduct sales this season.

“Sales bookings will open on Wednes-day 18th February 2015 and deliveries accepted as from Wednesday 25th Feb-ruary 2015,” the TIMB said.

Since the country adopted multiple for-eign currencies, the tobacco industry has experienced rapid growth as many farmers have shifted from other crops to the “golden leaf” due to the orderly marketing and favorable prices it

attracts.

The growth and viability of the tobacco industry has in turn inspired the local financial services sector to increase its support towards production of the crop.

The Bankers Association of Zimbabwe says local financial institutions have extended to tobacco farmers about 58 percent, of the cumulative loans extended to the agriculture sector dur-ing the 2014—2015 season, which translates to about $600 million.

In the 2015 National Budget, the gov-ernment projected that 90 000 hec-tares would be put under tobacco, with output projected at 220 million kg.

Last year, flue-cured tobacco output amounted to 216 million kg, compared to 165, 85 million kg in 2013.

An oversupply of tobacco on the inter-national market is expected this year and this may affect prices on the local market.— New Ziana •

Tobacco sales to begin next month

BH24

7 MINING

BH24 Reporter

Mwana Africa’s Freda Rebecca recorded a 14 percent decline in production for the third quarter ending December 2014 as the average feed grade fell 16 percent below the second quarter.

Although tonnes milled rose by 0.8 per-cent to 322,216 tonnes from 319,767 tonnes, total output for the period was 14,298 ounces from 16,555 ounces.

In a trading update, Mwana Africa said the main production stopes posted lower than expected grades resulting in the lower feed grade.

The group said gold recovery rate fell to 78 percent from 80 percent in the prior period as the plant had to cope with a

low-quality replacement carbon batch which resulted in gold being lost through fine carbon and being passed to tailings.

Cash costs for the quarter under review increased by 27 percent to $1,118/oz from the September quarter’s $880/oz as a result of the decrease in production and a 10 percent increase in operating costs.

All-in sustaining costs rose by 23 per-cent to $1,304/oz quarter-on-quarter from $1,061/oz in September. Royalties for the quarter were cown 37 percent due to lower gold production and to lower royalty rates introduced in Octo-ber.

The group’s Trojan Nickel Mine also recorded lower production as a result of

fewer tonnes of ore milled, a lower head grade and reduced recoveries.

Production was 30 percent below the previous quarter at 1,383 tonnes from 1,989 tonnes in the second quarter.

Equipment taken out for an ongoing refurbishment exercise resulted in a 23 percent drop in mill head grade and recoveries were also 2 percent lower than in the previous quarter. Nickel sales were 31 percent lower quarter-on-quar-ter from 2,008 tonnes to 1,395 tonnes. Cash costs and all-in sustaining costs both increased by 17 percent on a per tonne basis quarter-on-quarter as a result of the reduced nickel production.

The group also said work on the Bindura smelter re-start was ongoing with the delivery of the furnace bricks expected during fourth quarter of the year.

Mwana chief executive Kalaa Mpinga said the third quarter of the 2015 financial was a particularly challenging period.

“The nickel price decreased by 15% dur-ing the December quarter to $15,867/t (Q2 2015; US$18,592/t). Although gold’s price fell to an average •

Low head grade negatively impacts Mwana Africa Q3 perfor-mance

BH24

Zimbabwe’s first ever microfinance bank (MFB) will soon open its doors to the public after it was licensed to operate by the Reserve Bank mid-last month, an official has said.

The microfinance bank, named African Century Limited, will be a deposit tak-ing microfinance institution and makes history by becoming the first such legal entity operating in the economy.

Reserve Bank of Zimbabwe governor Dr John Mangudya said the central bank had licensed ACL on January 15 after it had met the minimum requirements.

“The institution will commence depos-it-taking microfinance business upon the successful completion of a pre-open-ing inspection,” he said.

“The coming on board of deposit-taking microfinance institutions is envisaged to enhance access to financial services particularly by the lower income groups of our society, thereby promoting a sav-ings culture in the economy.”

The central bank said nearly two years ago it would permit MFBs, required to have a minimum capital threshold of $5 million, to operate but there had been no takers despite earlier market cries

for such institutions to be allowed to operate.

Struggling commercial banks, some of which have since ceased operations, had been largely expected to down-grade their operations into MFBs while some microfinance institutions (MFIs) were anticipated to upgrade their license but this did not happen.

“While the current minimum capital of $5 million may be too high for our members to consider upgrading, there is likely to be new players coming into the sector and open microfinance banks or existing banks struggling to meet the new capital requirements downscaling

to micro banks,” said Zimbabwe Asso-ciation of Microfinance Institutions chair-man, Patrick Mangwendeza.

Zimbabwe has 147 registered microf-inance institutions registered with the central bank and hundreds more oper-ating in the shadows.

Experts in the MFIs sector say some of the institutions have not upgraded into microfinance banks to avoid central bank scrutiny.

Unlike commercial banks, which have been criticised for milking depositors, MFBs are expected to serve low income groups, providing not only basic bank-ing services at reasonable rates but also

extending loans at affordable rates compared to those offered by ordinary microfinance institutions.

Referred to in some countries as “bank-ing for the poor” MFBs are popular and are flourishing in countries such as Nige-ria where over 700 are in operation.

MFBs are known for being the major players in supporting the informal sec-tor as well as small to medium enter-prises, which in the case of Zimbabwe have become the economy’s spinal cord. — New Ziana•

99 NEWS

Zimbabwe licenses first Microfinance Bank

The equities market opened the week on a higher note in thin trading with the industrial index adding 0.66 points to close at 169.02 points.

Delta and Zimplow were up a cent each at 116 cents and 7.50 cents respectively and Innscor gained 0.99 cents to close at 59.99 cents.

Fidelity Life was the only counter to trade in the negative territory after shedding a cent to trade at 5 cents.

The mining index was flat at 58.13 points as Bindura, Falgold, Hwange and RioZim were unchanged at 5 cents, 3 cents, 4 cents and 15 cents respectively

Meanwhile, Meikles limited was sus-pended from trading on the ZSE with effect from today. — BH24 Reporter •

10 ZSE REVIEW

Equities opens week higher…as ZSE suspends Meikles

Last year, Finance Minister Patrick Chinamasa noted how the sanctions imposed upon Zimbabwe had brought the economy to its current precarious position.

“Over the past 15 years our economy has been battered by the imposition of sanctions by Western countries,” he said.

He offered a solution too. “Because of the sanctions, we are basically on our own. We have to look inward to see what we can do to leverage our own resources and mobilise fresh money.”

Zimbabwe presently has all the symp-toms of an economic depression, nota-bly a long-term downturn in economic activity.

But as Minister Chinamasa explicitly highlights, Zimbabwe needs to start building up savings.

Economists contend that savings are critical for economic growth because savings are offered to businesses that need credit hence boosts investment and economic growth. To this extent, it becomes clear that the liquidity con-

straints in the country is an indication of low savings and low incomes, which has led to low aggregate demand and low economic activity hence declining infla-tion and the cycle continues.

The situation therefore needs critical and urgent redress.

First, we need to ensure that all eco-nomic related policies are consistent and in line with what it is trying to achieve. Policies have effects on credit distribu-tion and availability, FDI, external credit attraction and private domestic invest-ment and ideally these effects should be

positive.

This step will help identify and under-stand the factors that can assist in attracting the much needed capital and the factors that disrupt the attraction.

If these are identified Government may begin to immediately work on imple-menting the factors that will improve the liquidity situation in the short term than develop the ones that have a long term effect. Second, considering that resources are extremely limited, the Government needs to focus on spe-cial and critical areas that need to be

addressed.

ZimAsset is a good policy but it is extremely broad in the areas that need to be sorted out yet funding is limited. The State needs to take a specialisation approach in resolving the economic cri-sis rather than trying to divide the little Government revenue it has on a large number struggling sectors.

The Government needs to identify the few well performing sectors at the moment and try to focus of boosting them so that they become the drivers of investment. Income from these sectors will then be spread to the other strug-gling sectors for their growth and devel-opment. Because of the low revenue levels the state has it is almost impossi-ble that all sectors can be assisted ade-quately at this point.

Third, Government should assertively tap into the informal sector and illicit activities that are feeding both external-isation and the underground economy.

Zimbabwe is only a few steps and a few decisions away from righting its wrongs.

•

11 analysis11 BH24 COMMENT

Few decisions needed to avoid economic depression

Minister Chinamasa

BH24

The Executive Board of the Interna-tional Monetary Fund (IMF) yesterday approved the immediate disbursement of SDR 45.135 million (about US$63.6 million) to the Republic of Guinea to help enhance international reserves, and cover the budget and urgent balance of payments needs resulting from the fight against the Ebola crisis.

This follows the completion of the fund’s fifth review of Guinea’s economic per-formance under the program supported by an Extended Credit Facility (ECF) arrangement.

The West African country has now received a total disbursement of SDR 136.935 million (about US$192.9 mil-lion) under the ECF agreement.

The IMF said it also approved a request for an extension of the current ECF arrangement to end-December 2015; it had in 2012 approved the three-year ECF arrangement for Guinea on Febru-ary 24, 2012, for SDR 128.52 million.

Naoyuki Shinohara, IMF’s Deputy Man-aging Director, praised Guinea’s appro-priate response to the humanitarian and economic crisis caused by the Ebola epidemic. He said that although the epi-demic slowed growth in 2014, inflation

continued to decline despite the modest exchange rate depreciation, while inter-national reserves were maintained at a satisfactory level.

“Despite these challenges, program performance under the Extended Credit Facility (ECF) arrangement was satis-factory. All end-June 2014 performance criteria and indicative targets, and most indicative targets for end-September were met. However, progress in struc-tural reform has been slow, in large part

because of Ebola-related constraints on capacity and delays in the delivery of technical assistance,” said Shinohara, who is also the chair of the Executive board, in an IMF press statement.

Uncertainties about the impact and duration of the Ebola epidemic dampen the near-term macroeconomic outlook, and real GDP is projected to contract in 2015. The 2015 budget, which appro-priates resources to combat Ebola and maintain a strong public investment effort, envisages an expansion in the fiscal deficit.

The January 2015 agreement on increases in civil service wages is within the limits of the 2015 budget, but will reduce budgetary flexibility over the medium term. The IMF says it is important to ensure that recruitment

in the social sectors is implemented as planned. The board adds that going forward, the authorities should press ahead with their civil service reform to ensure that the wage bill remains affordable and creates space for priority expenditure.

The IMF also called for sustained assis-tance from the international commu-nity, through the provision of highly con-cessional loans and grants and technical assistance.

It said the authorities have proven their commitment to ensure transparency in Ebola-related spending and complete their structural reform agenda under the program, to help underpin a revival in growth in the period ahead. — Ven-tures Africa•

REGIONAL NEWS 13

IMF approves $63.6m loan for Ebola-hit Guinea

14 DIARY OF EVENTS

The black arrow indicate level of load shedding across the country.

POWER GENERATION STATS

Gen Station

17 February 15

Energy

(Megawatts)

Hwange 275 MW

Kariba 614 MW

Harare 30 MW

Munyati 28 MW

Bulawayo 26 MW

Imports 100 MW

Total 1079 MW

Powerspeed Electrical AGM, 17 February 2015 at

1100 hrs, Powerspeed Complex Boardroom, Gate

1, Cnr Cripps road/Kelvin north rd.

26 February - 48th Annual General Meeting of

Mashonaland Holdings Limited; Place: Boardroom,

19th Floor, ZB Life Towers, 77 Jason Moyo Avenue;

Time: 1200 hours.

11 March 2015 - 3rd ZIMBABWE SME BANKING &

MICROFINANCE SUMMIT 2015; Place: Sango Con-

ference Center (Cresta Lodge Harare); Time: Time:

8.30am -4.30pm

THE BH24 DIARY

15 ZSE

ZSEMOVERS CHANGE TODAY PRICE USC SHAKERS CHANGE TODAY PRICE USC

ZIMPLOW 15,38 7.50 FIDELITy -16.66 5.00

INNSCOR 1.67 59.99

DELTA 0,86 116.00

INDICES

INDEx PREVIOUS TODAY MOVE CHANGE

INDUSTRIAL 168.09 168.36 +0.27 POINTS +0.16%

MINING 59.93 58.13 -1.80 POINTS +3.00%

Stocks Exchange

PREVIOUS

16 AFRICA STOCKS

Botswana 8,664.65 -11.96 -0.14% 12July

Cote dIvoire 249.37 -2.77 -1.10% 13Jan

Egypt 9,544.08 +235.10 +2.53% 14Jan

Ghana 2,259.78 -0.36 -0.02% 13Jan

Kenya 5,138.07 +16.08 +0.31% 13Jan

Malawi 14,904.99 +0.00 +0.00% 14Jan

Mauritius 6,693.78 -23.07 -0.34% 14Jan

Morocco 10,221.94 +195.15 +1.95% 13Jan

Nigeria 28,740.61 -1,149.25 -3.84% 14Jan

Rwanda 143.39 +0.20 +0.14% 02Oct

Tanzania 2,602.19 -30.74 -1.17% 28Oct

Tunisia 4,624.39 -39.32 -0.84% 07Mar

Uganda 1,942.77 -12.69 -0.65% 10Dec

Zambia 6,155.26 +3.96 +0.06% 12Jan

Zimbabwe 164.41 +0.66 +0.40% 14Jan

African stock round up Commodity Prices

Name Price

Crude Oil 1,300.91 -0.21%

Spot Gold USD/oz 1,292.63 -0.26%

Spot Silver USD/oz 19.38 -0.46%

Spot Platinum USD/oz 1,421.25 -0.33%

Spot Palladium USD/oz 798.50 -0.64%

LME Copper USD/t 6,770 -0.18%

LME Aluminium USD/t 1,780 -1.17%

LME Nickel USD/t 18,230 -1.73%

LME Lead USD/t 2,095 -1.41%

Quote of the day — EithEr you run thE day, or thE day runs you.

Globalshareholder.com

17 INTERNATIONAL NEWS

FOR more than a fortnight, Europe’s single warning to Greece has been that the chaos and misery of national bank-ruptcy await it unless its new govern-ment changes its anti-austerity tune.

The message of impending doom appears to have gone largely unno-ticed on the streets of Athens, where a mood of hope and optimism border-ing on euphoria reigns as Greeks see themselves finally shaking off foreign shackles to shape their own destiny.

"Bankrupt but free" proclaimed a ban-ner at a pro-government demonstra-tion last Wednesday that drew thou-sands.

Finance Minister yanis Varoufakis was isolated at Thursday’s crunch eurozone meeting in Brussels, however, Greek TV channel Mega’s main news broad-cast gushed over him "stealing the show".

"For the first time in years I feel proud to be Greek," said Lena Dousiou, who worked in a printing shop before being laid off two years ago. "We went to the Europeans with our head held high and told them ‘Enough is enough!’"

Another TV feature on Mr Varoufakis

had the pop hit Can’t take my eyes off you in the background. Far from obsessing over a potential Greek banking collapse or a euro exit after Thursday’s talks ended without agree-ment, Greek newspapers suggested a "bridge" deal would soon be adopted.

"Spring in Athens, fog in Brussels" pro-claimed Efimerida ton Syntakton on its front page.

Two polls last week showed that over three-quarters of Greeks support Prime Minister Alexis Tsipras’s hardline stance for a wholesale cancellation of Greece’s bail-out programme, which has alarmed Europe and left Athens close to bankruptcy.

An opinion poll last week showed 79% of Greeks backed Mr Tsipras’s policies and 74% believed his negotiating strat-egy will succeed, even though Greece has so far found not a single ally among 19 eurozone nations.

The mood is in stark contrast to 2012 when panic over a potential Greek eurozone exit prompted Greeks to vote in a pro bail-out government despite popular discontent with the programme. Two and a half years later, the public mood has shifted from anger

to the point where many Greeks feel they have nothing more to lose.

Austerity imposed as a condition of the €240bn European Union-International Monetary Fund bail-out has pushed joblessness over 25% and cut incomes by over a third.

"We’d hit rock bottom," said Minas Kontogeorgopoulos, 59, who works in a key-cutting shop. "The Europeans have humiliated us. I don’t know if Mr Tsipras will succeed but someone had to tell them enough is enough."

The fledgling prime minister’s resound-ing success on the domestic front, while simultaneously horrifying policy makers elsewhere, reflects the extent to which Greeks resent the "humilia-tion" of being told what to do by foreign powers, a common theme in the Medi-terranean nation’s history.

In an emotional first speech to par-liament as prime minister, Mr Tsipras mentioned the word "dignity" 11 times.

A skilled orator with a keen sense of the public mood, he has made restor-ing Greek pride after four years of "national humiliation" at the hands of what he paints as dogmatic foreign

technocrats a cornerstone of his rhet-oric. "We declare categorically that we will not negotiate our history. We will not negotiate the pride and dignity of this people," he said.

While many European policy makers see the Greek problem as a mostly economic issue which Greeks must resolve by following the terms of com-mitments they have made to secure money, for many Greeks it is a cultural issue that taps into suspicions of nefar-ious foreign interests and victimisation.

Much Greek resentment towards for-eigners stems from the centuries when it was under Ottoman rule, cut off in what many Greeks saw as a backwater away from the Renaissance and other enlightenment progress enjoyed by other Europeans.

There is also simmering discontent with Germany’s Second World War occupation, some of Britain’s colonial exploits and the role the US played in both the 1944-49 Civil War and the 1967-74 military dictatorship.

Many senior Syriza officials have spent years portraying Greece as a victim of foreign interests. — Reuters •

Greece shrugs off Europe warning of bankruptcy

By Bernard Bwoni

A recent report by the Oakland Institute revealed that there are billionaires from the West who have been buying and grabbing land in Africa at a very con-cerning rate.

These investors and hedge funders are reportedly paying next to nothing for these vast tracts of land in some Afri-can countries. This is a worrying trend and puts into context the Zimbabwe land policy and reform. Interestingly in South Africa in his State of the Nation address, President Zuma said that for-eign nationals will not be allowed to own land in South Africa but will be for long-term lease only.

The land reform debate in SA has been taking centre stage with the country exploring a 50-50 Policy framework on rights to people who live and work on farms. The Zimbabwe Land Reform programme is a beckon of hope for the historically and perennially disad-vantaged and displaced Africans. Any other African country in the same pre-dicament as Zimbabwe was before the land reform will have to go through the

same mire and mud Zimbabwe went through to regain their land. It is such a shame that some African countries are relinquishing their God-given heritage for a few pieces of silver. Zimbabwe is a unique country and all the hard work was not for nothing. There is no other route to land reform in Africa except for the Zimbabwe Model. Anything else is child's play.

There is no universal definition of the term property rights as everyone has an opinion and vested interest in the matter. The definition can and has been evolving over time, thus considering different perspectives, the historical context and background underpinning the Zimbabwe land and property rights issue is necessary. Property rights are not absolute but just a function of what society is willing to acknowledge, defend and enforce. They may need to be adjusted at some point because they do not evolve optimally on their own. There is not enough empirical evi-dence in Zimbabwe of how the complex property rights package influences eco-nomic behaviour and as such those who remain fixated on property rights as the panacea to Zimbabwe’s economic

woes are unreflective and insincere. The Development Economist Daniel W. Bromley in his book, Environment and Economy: Property Rights and Public Policy, argued “property rights do not necessarily imply full ownership and the sole authority to use and dispose of a resource”. To be secure, property rights should be of a sufficient duration to allow one to reap the benefits of the investment and should be backed by an effective, socially sanctioned enforce-ment institution. Zimbabwe has in place ninety-nine year lease in place and that is “a sufficient duration” for anyone to benefit from their investment, case closed.

The relationship between the rights of the individual and the rights of the community has been constantly chang-ing and without doubt will continue to evolve. We live in a complex and dynamic world where conventional wis-dom can be overturned for the good of the majority and it is important to acknowledge that changes in theoretical views on property rights do take place. During the unrestrained land grab by the colonial settlers the rights of the individual settlers took precedence over

the collective rights of the indigenous community and in the new Constitution the Zimbabwe government addressed those inequalities created by these his-torical interactions.

Much of the early property rights litera-ture was quite optimistic about the evo-lution of property rights towards eco-nomic efficiency. The available literature indicate that property rights form the cornerstone of every Western country’s economic modernisation and Hernando De Soto even calls the system of legal property rights the ‘’hidden architecture of modern economies’’ and “if a devel-oping country is willing to succeed eco-nomically, property rights which have to be well-defined must be enforced”. De Soto of course did not factor in China which “recognises the right to private property but only as a right bestowed by the state and not as a natural right’’. And, by the way China, is by far the fastest growing economy in the world and is poised to edge the USA as the biggest economy in the world by 2016 or so. My argument is that the property rights construct and debate in Africa was distorted by the colonialism and imperialism’s accumulative streak and

18 analysis

Africa's only hope is Zim's land reform model

18 ANALYSIS

19 analysis19 ANALYSIS

that makes De Soto’s claim invalid in the African context. Property rights are theoretical constructs in economics and the discourse needs to reflect that espe-cially on a uniquely multiplex case like Zimbabwe. Property rights are formed and enforced by political entities and they reflect the historical context, the conflicting economic interests and the bargaining strength of those affected. They are the social institutions that define or delimit the range of privileges granted to individuals of specific scarce resources. In the modern economic lit-erature the argument is that it makes sense to have secure property rights as it makes it easy to access finance and credit from financial institutions and pro-mote sustainable development.

Some contemporary development economists have gone as far as stating that sustainable development will only come from stable property rights and that markets are less efficient when property rights do not exist. From a the-oretical economic point of view that is true however complexities in different situations need to be acknowledged. There is an element of imperialism that has pervaded much of the discourse of property rights on Zimbabwe. I have

looked into available literature on prop-erty rights on Zimbabwe and there is absolutely nothing and the question is how do you make recommendations without empirical evidence from realities on the ground?

Those who remained opposed to Zim-babwe’s land reform have argued that separation of provisions on property rights from rights over agricultural land is fatal as the section in the new Consti-tution on agricultural lands restricts thus running against natural justice. Chapter 4, Part 2, Section 72 of the Constitution points out that access to agricultural land is seen as a “fundamental right” and that “every citizen of Zimbabwe has a right to acquire, hold, occupy, use, transfer, hypothecate, lease or dispose of agricultural land regardless of his or her race or colour’’. The new Constitu-tion also notes that following the colonial occupation and the triumphant libera-tion war “the people of Zimbabwe must be enabled to re-assert their rights and regain ownership of their land”. If you read the above clauses then the issue of secure property rights is not as conten-tious as some would want the world to believe. The land reform in Zimbabwe is irreversible, and that is fact. Property

rights with regards to agricultural land fall within the limits set by the State to avoid abuse and the government has set up the Land Commission to address issues of abuse through a transparent land audit which is still pending, and this is all within the bounds of international law. Chapter 4, Part 2, section 71 of the new Constitution addresses the overall issue of property rights fairly and again in line with international law. The rights are extended to all people and the rights to compensation are recognised. How-ever the issue of property of agricultural land needed to be and was addressed in line with the need to “redress the unjust and unfair pattern of land ownership that was brought about by colonialism”. Conventional economic wisdom tells you that economic progression is based on strong foundation of secure property ownership, but what it does not do is take into account complex interactions on the ground.

Chapter 4, Part 2, section 72 of the Con-stitution seeks to protect the continuing rights of persons currently occupying or using agricultural land under a lease or other agreement with government and states that the State must take appro-priate measures ‘’to give security of ten-

ure to every person lawfully owning or occupying agricultural land”. The Con-stitution states that, not all agriculture land will not be State land and “owners and occupiers will be allowed under the provisions and limits of the law to ‘transfer, hypothecate, lease or dispose of his or her right in agricultural land”. It is important to understand the fact that the property rights issue is insufficient in explaining why capitalism has suc-ceeded in the West but failed dismally in other parts of the world.

The issue of property rights surely can-not be absolute without taking into con-sideration the realities on the ground. The choices we make today are often constrained by the decisions and actions of yesterday. History does matter and it is history that shapes our futures. The shifting relationships of property and property rights in the Zimbabwean con-text are contentious and as such it is important to adopt a historical outlook to it to garner a better understanding. The discourse around the issue of prop-erty rights needs to be reflective and all-encompassing for better outcomes for all Zimbabweans. — benardbwoni.blogspot.com •