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Govt’s opaque deals burden taxpayers



THE government’s involvement in dubious deals that are shrouded in secrecy shows lack of transparency and accountability, which may plunge Zimbabwe into a full-blown authoritarian kleptocracy.


Last week, Russian company Rostec delivered 18 of 32 Kazan Ansat helicopters, which President Emmerson Mnangagwa said will be used for ambulance, disaster management, policing and wildlife protection duties.

Rostec is a massive Russian state-owned enterprise formed to consolidate the nation’s technological, aerospace, and military-industrial expertise.

It is also a holding company whose subsidiaries are engaged in a wide range of industries, including automotive, defence, aviation, and metals.

While Mnangagwa said he personally sourced the helicopters from Russia’s Vladimir Putin, the nature and cost of the deal entered by government has remained unknown, raising eyebrows, as it was done without Parliament’s approval.

Political analyst Rashweat Mukundu says the shoddy nature of the helicopter deal indicates that the government is becoming increasingly unconcerned about transparency and accountability.

In a kleptocracy, corrupt government leaders use political power to expropriate the wealth of the people and the land they govern, typically by embezzling or misappropriating public funds at the expense of the wider population.

“The challenge with the Zanu PF government after the 2017 coup to date is that they have absolutely no regard for the constitution. They have no regard for transparency and accountability in governance. This is a Mafia that has taken over the state and has no interest in being accountable in its utilisation of state resources,” Mukundu told The NewsHawks.

He said this is likely to see the demise of Zimbabwe partly because of unnecessary debt.

“This abuse of national resources is predicated on a thinking that they are above the law and nothing can be done to them. I think the saying of those who speak for them on the ground, even those who speak for them officially is; ‘So what will you do to us?’ (Saka muchaita sei?), as we heard from Passion Java, and we regularly hear from the likes of George Charamba on Twitter.

“So, a system that is all banked on looting national resources to no end with no regard for anything that has something to do with transparency and credibility. To expect anything better from this group then, is to expect miracles in terms of how we are governed.  

“There is absolutely no chance in hell for Zanu PF in its current format to be reformed, to respect the constitution and to respect laws of the land. So to me what we are seeing in terms of procurement issues just points to the collapse of state management. It points to the takeover of the state by criminal elements and it may point to the collapse of the Zimbabwe state as we know it,” Mukundu said.

 Vivid Gwede, a political analyst, said secrecy shrouding the helicopter deal shows that the government may be concealing more corruption. “There is no doubt that the current administration does not believe in being proactively transparent with procurement processes. But given how procurement processes have been used to loot, including through inflating prices, this attitude is not surprising. “The helicopter deal is no different. There have been contradictory statements on whether it was a donation or a purchase, with Parliament clearly sidelined.

“When a government is not proactively transparent or actively concealing its dealings in procurement, there is a high likelihood that it is corrupt,” Gwede said.

Zimbabwe’s fight against corruption has been hollow, with the country faring badly on the Corruption Perception Index (CPI) released in February by the civil society organisation Transparency International Zimbabwe (TIZ).

The country has been a non-mover, with a 23/100 score, falling behind the regional average of 32/100, while ranking 157 out of 180 of the most corrupt countries in the world. The index measures perceptions of public sector corruption levels in 180 countries around the world.

The global average has remained unchanged for over a decade at just 43/100, while the sub-Saharan region average is pegged at 32/100. Zimbabwe has the lowest score in the Sadc region, trailing all its neighbours, with the Seychelles scoring 70/100, the highest score in the sub-Saharan region, followed by neighbours Botswana with 60/100.

The country also falls below South Africa, Mozambique, Zambia and Malawi, among others, scoring 43/100, 26/100, 33/100 and 34/100 respectively.

Zimbabwe Coalition on Debt and Development (Zimcodd) programmes manager John Maketo says the uproar over the helicopter deal shows the need for the country to harmonise public finance management laws in order to strengthen parliamentary oversight.  “

This (the helicopter deal) emphasises the need to harmonise public finance management laws in Zimbabwe. You will actually find that, despite all the public uproar, the procurement has a supporting piece of legislation, meaning it is lawful.

“Governments use laws and procedures, not emotions or morality. It is therefore urgently imperative that PFM [public finance management] laws be aligned to the constitution,” Maketo said.

The government has been under fire for its opaque deals and loan disbursements without parliamentary approval. For instance, in March the High Court ordered Treasury to gazette within 12 months a Bill amending the Public Debt Management Act [Chapter22;21], after it emerged Finance minister Mthuli Ncube was approving loans without Parliament’s authorisation, in violation of the constitution.

This came after Zimcodd sought a court declaration compelling the government to approve loans only after parliamentary authorisation.

The organisation’s founding affidavit shows that the government issued guarantees for domestic creditors amounting to ZW$20.2 billion and US$1.4 billion without Parliament’s approval in 2021 alone. In terms of the current law, Treasury is empowered to provide guarantees in term of section 20 of the Public Debt Management Act [Chapter 22:21].

 More unbudgeted expenditure has also recorded.

 “In 2020, government had issued domestic guarantees to private companies totalling ZW$24.2 billion, and a 77% recovery rate for guarantees in respect of CBZ Agro-Yield (Pvt) Ltd for farmers only a 0.6% recovery in respect of CBZ AgroYield loans to farmers and a 22% recovery to farmers for the 2022 one agricultural season and only 13.2% recovery for 2020-2021 finance to soya beans farmers,” read the affidavit.

According to Zimcodd, approval of loans without Parliament’s endorsement weighs heavily on citizens, who end up paying the debt, since loans or debts contracted are ultimately paid by the people of Zimbabwe through the Consolidated Revenue Fund.

Zimbabwe has been weighed down by debt, which has seen the country fail to get external lines of credit from institutions like the International Monetary Fund (IMF) and the World Bank. With a total consolidated debt of US$17.5 billion, Zimbabwe owes international creditors US$14.04 billion, with domestic debt pegged at US$3.4 billion.

Debt owed to bilateral creditors is estimated at US$5.75 billion, while multilateral creditors are owed an estimated US$2.5 billion. The government has also failed to account for the US$10 billion unauthorised expenditure from 2015 to 2018.

In 2020, the government brought a Financial Adjustment Bill to Parliament as it sought condonation for the unapproved expenditure.

According to the Bill, in 2015 Treasury exceeded the national budget by US$25 305 741, which ballooned to US$1 490 888 789 in 2016 and trebled to US$4 562 064 124 in 2017.

 The government overshot the budget by US$3 560 343 130 in 2018. The government is yet to provide an explanation, hence the need for transparency.

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