Chinamasa got it right

HARARE - On September 1, 2014, the Daily News, reporting on the aftermath of President Robert Mugabe’s State visit to China under the headline,’ Mugabe returns from China with signatures’, reduced the presidential trip to a “begging trip” that had only secured “… secretive agreements and signatures but with no cash to revive an economy which is virtually on its knees.”

“However, it is not clear how a broke government will repay China, and how the deals will ease the suffering of Zimbabweans blighted by shrinking incomes and failing social services. What China will get in return also remains another big question,” further read the Daily News article.

But most importantly and very critically as if to self-correct the gloomy picture created of Mugabe’s trip to China, the Daily News went on to reproduce a quote by Finance minister, Patrick Chinamasa, which they attributed to the State media.

“No country sets aside a lump sum payment for no specific projects. Projects must demonstrate their ability to pay for themselves. You will not come to China to ask for money to invest in a project that won’t pay for itself. That would not make economic sense,” read the quote.

It is important to note that in China, the following big sectors are either 100 percent or majority controlled by the state: oil, petro-chemicals, mining, banks, insurance, telcoms, steel, aluminium, electricity, aviation, airports, railways, ports, highways, autos, healthcare, education and the civil service.

What is the relationship of Zimbabwe’s government to the afore-mentioned sectors and their contribution to the economy as a whole? Chinamasa’s statement in a way answers this rhetoric question.

Going by Chinamasa’s statements, one reaches a conclusion that, in as much as Zimbabwe might seek lines of credit to boost investment, there is an urgent need to realign our state institutions into profit-making machines before seeking external funding.

The Zanu PF government is alive to the fact that it should concentrate on putting its house in order, cracking down on their current harmful activities such as the ill-informed factionalism and corporate malpractice. On the latter, Government recently proposed a National Code of Corporate Governance which to large extents directs how state entities should be run?

What we see today through the National Code of Corporate Governance is the reincarnation of positive governance traditions and a hands-on role for the state.

This kind of approach gives Government time to make an assessment of all its state enterprises and type of investment required. The internal strengthening of state institutions using local resources gives them time to stabilise and have an edge to negotiate favourable contractors with potential investors in future unlike the current situation which exposes the country to exploitation.

For example, the New Limpopo Bridge which was recently handed over to the Transport ministry following the lapse of the 20-year Built Operate Transfer (BOT) agreement was built at a cost of $5 million.

According to government the private investor collected a net profit of over $400 million during the said 20 years. But the million dollar question is whether in 1995 the same government failed to raise the $5 million to necessitate the loss of $400 million into foreign economies.

It is important for government to re-establishment the Roads Department before its road rehabilitation and dualisation programme.

There is no reason why the country should be contracting companies such as Group Five, South Africa whose employees are mostly Zimbabweans when we can resuscitate the department.

One major investment that could rock Bulawayo back into life is the resuscitation of the National Railways of Zimbabwe (NRZ). The parastatal is reportedly in need of $450 million to achieve a total turn around.

Surprisingly there are reports that in the UK the same NRZ is sitting on real estate worth over 200 million pounds. In South Africa the parastatal has huge platinum mines that remain untouched yet it is living from hand to mouth.

Investments by the National Social Security Authority (NASSA)? They stink of corporate malpractice

Does a country with such a strong baseline of infrastructure really need to be reduced to beggers? No! To borrow Chinamasa’s words to get Zimbabwe at its best there is need to identify projects that can demonstrate their ability to pay for themselves and run with them.

Comments (6)

The NRZ Pensions Fund owns the real estate in the UK and here in Zim and all those other investments. The Pension Fund is a separate entity from NRZ!

gogo - 3 September 2014

@ Gogo, but contributions are from Zim workers.

Gogodera - 3 September 2014

And what benefit are the workers deriving from this super rich pensions fund? Im sure a lot of former employees have died paupers but being very rich pensioners.

badass - 3 September 2014

In China,corruption of any amount attracts a good jail term, or death,theft of any state money attracts death sentence, lying under oath is punishable by a heavy jail term,under performance attracts dismissals from one's job and in Zimbabwe,corrupt chefs are rewarded by promotions and free houses,free education,etc,,theft is rewarded by a transfer to a better job,lying under oath is rewarded by another senior portfolio .In China ,their president earns an annual salary equivalent to that of our parastatal chairman's monthly salary and which country can borrow which, and if it is Zimbabwe,is there any logic for the Chinese to give money to pay civil servants who earn more than their ministers.

kabston - 3 September 2014

It is naive for anyone to believe ZANU PF lies that China is our friend&we should expect them to help us in any way.How could our economy sink so low yet we always sang the 'Look East'policy?This Chinese trip only confirmed our perennial begger status.After all, Chinese are very much aware of our government's corruption which they actually hate back in their country.

makoronyera - 4 September 2014

Sometimes one can't help empathysing with Chinamasa. He knows what needs to be done but is completely powerless to reign in his comrades.

Johno - 18 September 2014

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