Maravi

Govt scheme to grab finance bank exposed

COMMENT - Is it a surprise that a corrupt government would go about nationalisation corruptly? Just as they went about privatisation corruptly? Something deeper is going on too. Anyone who would accumulate enough money to present a challenge to the party in government is systematically undermined. I think that could be the real motivator behind the corruption that we see in the mining sector and the non-collection of revenues or dividends. They are bleeding the country dry, just so the local elite can remain in power. This is a real problem, and it needs real solutions. We need to break out of this system.

Govt scheme to grab finance bank exposed
By George Chellah
Thu 09 Dec. 2010, 04:01 CAT

PRESIDENT Rupiah Banda’s government is planning to nationalise Finance Bank Zambia Limited (FBZL) in a bid to cut off Dr Rajan Mahtani’s influence on the institution and make sure he gets nothing. But sources say the bank is currently doing very well and it would be madness for the authorities to take such an extreme move just to fix Dr Mahtani.

Sources at the Ministry of Finance and National Planning (MoFNP) have revealed that government through the Bank of Zambia (BoZ) is expected to move on the bank in an operation code named Project Water.

The sources, however, say that the move has attracted some opposition from experts within MoFNP and the Central Bank who strongly feel that there are better ways of dealing with Finance Bank than through nationalisation.

“It’s madness to nationalise a bank, which is doing fine just to punish Mahtani. Actually, the take-over process would have taken place earlier on, but finance minister Dr Situmbeko Musokotwane seems to have problems with the idea of using taxpayers money in such a manner. There is a lot of political maneuvering to make sure that Mahtani is brought down,” the sources said.

“And this is being planned from State House. A joint team including senior officials from State House, Ministry of Justice and Bank of Zambia has been pushing the agenda. This team has been frequenting South Africa to prepare for the nationalisation of Finance Bank. And people have been shifted around to make sure this project is implemented.”

The sources revealed that the operation was intended to make it look like a normal BoZ activity when in fact the architects of ‘Project Water’ were just politically motivated.

“The real issue is that State House suspects that Mahtani is financing the opposition through the bank and to cut off this life line, they need to remove him from the bank completely through this take over,” the source said.

The sources disclosed that the scheme is that BoZ would be used to try and make the nationalisation acceptable to the public.

“It is now abundantly clear that there were no issues or problems of any serious nature in the bank except for the politically motivated actions,” said the source.

The source added: “This is wrong for our country, how can someone be so reckless and start tampering with the banking industry for political reasons. It seems whatever political fears they have, have blinded them to the dangers of destroying the Zambian financial sector. We just privatised Zanaco, how can people now be thinking of nationalising a private bank?”

Labels: FINANCE BANK, NATIONALISATION, RAJAN MAHTANI

posted by MrK @ 2:33 PM