HARARE - President Robert Mugabe says Indigenisation minister Saviour Kasukuwere “got it wrong” in some empowerment deals stitched together with several foreign-owned companies.

The development not only vindicates the Daily News’ on-going exposé on the implementation of the key programme, but also affirms Vice President Joice Mujuru’s statements that top government officials must not abuse the empowerment programme at the masses’ expense.

 “So the problem ndiyoyo, ivo vakatipa 51 percent vachiti chikwereti chatirikukupai asi tichakubhadharirai mangwana mozotibhadhara that is where the difference is’,” the 89-year-old Zanu PF leader said in an interview ahead of his Bindura birthday celebrations yesterday.

“I think that is where the minister made a mistake. He did not quite understand what was happening and yet theory yedu ndeyekuti resource iyoyo ndeyedu and that resource is our share that is where the 51 percent comes from,” Mugabe said.

This also comes as Kasukuwere has put Zimbabwe “into bondage” by agreeing to a raft of debt-driven indigenisation deals such as the Zimbabwe Platinum Mines Limited (Zimplats)’s $971 million localisation deal.

And as Mugabe expressed his strong views over the “shoddy work” masterminded by the young, and boisterous minister — and in the process hauling him over the coals — he suggested the Mount Darwin South legislator was dancing to the whims of foreign nationals at the expense of the poor who own the minerals.

According to deals signed by Kasukuwere and several miners, for instance, Zimbabweans will only be able to lay their hands on the actual shareholding until after at least 10 years after paying off their debts and under a much-discredited vendor financing scheme.

While several analysts said that locals may even fail to pay for their shareholding in the prescribed period, this form of financial engineering relates to a process where an established company lends money to an entity seeking to buy into it.

Under the Zimplats deal, for instance, 31 percent was issued to National Indigenisation and Economic Empowerment Board (Nieeb), 10 percent to employees and the other 10 percent was given to Ngezi-Zvimba Community Share Ownership Trust.

Apparently, if the Zimbabweans fail to pay the cash in 10 years — which is almost certain considering Zimplats has declared a $50 million dividend in the past decade — they will be given 10 days within which to pay the cash or they will forfeit the shares.

Also, what endangers the vendor financing deal is that Zimplats has already posted a staggering loss.

Zimplats registered a $6 million loss in the half year to December 31, 2012 down from a $68,4 million profit recorded in previous comparable period.

Since our sister paper the Daily News broke the news on February 14, it has since emerged that the proposed mechanism of ceding 85 percent of the dividends to repay the $971 million loan in 10 years is unsustainable.

At 10 percent interest per annum, the indigenisation parties will need to make an annual repayment of approximately $158 million.

Mugabe, who has been in power since the country got its independence from Britain 33 years ago, is using the indigenisation programme as his last trump card as the country gears for a watershed election.

The former guerrilla leader, who at 89 is likely to be contesting his last election with indigenisation as the last ace up his sleeve, boasts of having brought sovereignty, empowerment and total independence but the recent revelations that the Zimplats deal was flawed presents a major setback.

At his birthday celebrations yesterday, loyalists did not disappoint as they took turns to bootlick the octogenarian leader, showering him with unprecedented praises over the indigenisation programme.
 
From choir groups to other praise singers, Mugabe proved a hero for bringing the indigenisation programme.
Yet Kasukuwere, the programme’s torch bearer, has clearly hit an off-target.

It has become apparent that the Zimplats deal is not feasible in any foreseeable future or it will never materialise.

Mugabe’s comments come as Kasukuwere’s indigenisation deals have been questioned right from the beginning.
 
South-African-based businessman Mutumwa Mawere has said while the objective to empower previously disadvantaged persons is laudable, the legal, just and equitable and constitutional instruments to achieve the desired goal will always be more difficult to develop.

“After reading the comments by Mugabe in an interview aired on the Zimbabwe Television and published by the Herald newspaper on Saturday, 2 March 2013, one gets the distinct impression that Mugabe’s indigenisation template is diametrically opposed to the one used so far by Kasukuwere and defended vigorously by Moyo (Jonathan),” he said.

“Obviously oblivious of the construction of the mining deals concluded so far, he (Mugabe) said that the government would not buy shares in mining companies, but would use the value of the mineral deposits to determine shareholding,” Mawere added.

When the Daily News broke the news, which it has since dubbed Nieebgate, the frenzy has gone viral and has courted the ire of several people, spurring the corruption watchdog Zimbabwe Anti-Corruption Commission into action.

Many stakeholders have called for an investigation to be carried out on the manner in which the indigenisation programme was handled.

In yet another Daily News exposé, it emerged that one of the advisory firms which played a consultancy role and fronted by ex-banker George Manyere — Brainworks Capital — was expected to pocket up to $45 million from the Zimplats deal alone at least according to advisory firm’s mandate letter.

Brainworks has also under its armpits, indigenisation consultancy deals for six other top-earning companies.

Nieeb chairperson retired lieutenant general Mike Nyambuya and other spin-doctors insist that Brainworks Capital was awarded the contract transparently.

 Nyambuya and Brainworks claim the transaction was not done outside the law but the $971 million deal is way above $300 000 — which is the value of all government deals that must be put to tender.

This paper however, has authoritatively established that the ministry of Mines, under whose jurisdiction the indigenised mines fall, and the Reserve Bank of Zimbabwe (RBZ), who play an advisory role in such deals, were not consulted.

State Procurement Board chairperson Charles Kuwaza has also confirmed that Brainworks was awarded the lucrative empowerment deals without going to tender.

“We have not received any proposal of that description and consequently have neither considered or authorised it. The accounting officer at Indigenisation board or Nieeb has not approached us in that regard,” Kuwaza said.

“Your lead in today’s issue of the Daily News is the first time we have ever heard about these arrangements,” said Kuwaza, referring to the story published on February 14.