Saturday, May 22, 2010

(ZAMBIAN ECONOMIST) Eight reasons for rejecting higher mining taxes...

COMMENT - This is an excellent Socratic treatment of the pro's and con's of a re-introduction of the Windfall Tax, and why the Zambian economy is not benefiting from it's main economic activity - copper mining. Please comment on this article at the original page on the Zambian-Economist blog.

Eight reasons for rejecting higher mining taxes..
by Chola Mukanga
Saturday, 22 May 2010

Today, we turn the tables and present the most cogent arguments that could be made, if I was hired as a “spin doctor” for Rupiah Banda and help argue against relatively higher taxation than at present (It is taken for granted in the post below that higher taxation would mostly likely involve restoration of the Mwanawasa mining fiscal regime, with windfall taxation at its heart). I offer eight reasons that can be put forward for rejecting higher mining taxes - offering both the central argument to substantiate the reason and then the counter-argument (response). Effort has been made to be impartial but also succinct. One can write an essay on each of the arguments, but for ease of access I have tried to summarise them. I’ll leave it to the reader to expand on them and decide whether the “argument” is stronger than the “response”. By nature of the "title" and this introduction, I have shifted the burden of proof onto those seeking change.

Reason 1 : High taxes would reduce competitiveness

Argument: Increasing mining taxes when other countries are not changing their tax systems, with the exception of Australia, would make Zambia uncompetitive in this important area. Zambia is a small country and we are not exactly renowed as an attractive place to invest. on It is because of the mining revival that we are now having investment in excess of $3bn annually. We have also seen that countries that have imposed windfall taxes have lived to regret. For example Mongolia once raised its mining taxes only to find itself in a quagmire with investment drying up! We must also remember that low taxation is the bedrock of attracting foreign direct investment (FDI). It is therefore critical that we see mining in the overall context of Zambia’s successful FDI policy. No one doubts that low taxation is critical component to that.

Response: The argument is based false premises for several reasons.

First, Zambia’s taxation threshold has enormous scope for increasing taxes without harming competitiveness. Zambia has one of the lowest tax regimes in the world. Prior to 2008, the effective tax rate stood at around 32%, with the Levy Patrick Mwanawasa (LPM) changes it was intended to rise to 47%. LPM put it best : "with these new measures, the Zambian tax regime still remains competitive and moves Zambia into the media position in international comparisons at 47% effective tax rate. The effective tax will not adversely affect the companies' viability as their returns will remain well within the international norms". In short Zambia was to tax more than Tanzania but less than resource rich nations Botswana, Mozambique and Angola. It is therefore wrong to suggest that reintroducing the windfall tax for example would significant damage it’s competitiveness.

Secondly, there’s no concrete evidence that FDI is driven by lower taxes per se. Although tax competition is used usually to justify the level of tax, it is clear from literature that the key driver of foreign direct investment tends to be political stability, cheap / diverse labour and, most importantly, prevailing global economic forces. Zambia’s mining industry is booming because the prices of commodities are high and will continue to be high for some time, aside from few fluctuations because of the long term global imbalance between demand and supply. Of equal importance is that the investors are confident of the political ambiance in the country.

Third, the argument is structurally predicated on the idea that growth in mining must necessarily be driven by external investment – this need not be the case. Many economists believe that although FDI has a role to play in development, what matter is the structural transformation of the production side of the economy. To do that requires government investment in technologies and other supporting industries, which won’t happen without access to mining revenue. Indeed, without government revenue there can be no tangible and accelerated diversification.

Finally, there’s a broader point also to be made – the current low mining taxes may be attracting “wrong investors”. Many of the investors Zambia has attracted in the mining industry have been nothing short of short term vultures (term used is "infestors"), whose primary interest is to come into the country to siphon resources on the cheap and vacate premises when the going gets tough. Poorly designed incentives coupled with a friendly regulatory structure continues to undermine Zambia. A strong starting point in rectifying these problems is appropriate and fair taxation.

Reason 2 : High windfall tax would harm exploration

Argument: The biggest challenge for Zambia is to discover and exploit the vast minerals we have. To do that we need exploration, this is a costly and uncertain exercise. It is undertaken only if there’s a strong possibility of finding something and being able to earn a return on it. Relatively higher taxes, especially in the form of revenue windfall systems, are a disincentive to exploration. As a country we are in a hurry to develop and achieve middle income status by 2030. We must incentivise investors to undertaken exploration activities because that would guarantee a better future for our children. Allowing foreign mining firms to continue operating under existing conditions would guarantee the opening up of more copper mines, which would in turn create more employment for Zambians. Not only that government would collect more taxes through personal income tax and land tax the councils collect from the mining firms, while the tourism and services sectors would also benefit from wider catalytic impacts.

Response: There are three problems with this argument. First, it treats mining taxation in very general fashion. We must distinguish the principle from the application. It is not true that any mining taxation reform would lead to lower exploration activity. Different incentive or taxation structures can be developed that would allow the people to benefit from current mining activities while incentivising future exploration. Secondly, it predicated on a highly uncertain future. The investments that would be disincentivised, if the argument is to believed, are those taking place from 2020 and beyond. However, given the current configuration of the taxation system, as we have seen in Lumwana’s case, no significant revenue would begin to accrue from any such unknown investment until 2025 and beyond. In short this is an argument about an unknown and distant future. Finally, the argument again presupposes that only foreign firms can do “exploration activities”. There’s a strong case for government to assume a greater role in exploration activies to narrow the information loss between investors and government. This would also help reduce the sort of problems we have seen where Lumwana has huge uranium deposits off the back of a copper investment. More exploratory and geological exploration would put the Zambian people in the driving seat of their resources.

Reason 3 : Higher mining taxes will compromise safety and harm environment

Argument: Increased taxation will not have the desired social effect because it mainly leads to mining companies pushing the costs on workers and local communities. Principally mining safety and environmental damage would get worse as foreign firms seek to maintain their profits. Indeed the service conditions of workers may also be affected. We would be robbing Peter to simply pay Paul! The worker and the local community must come first. Higher taxation would not make things easier for these groups. Quite the contrary it will make it worse!

Response: There’s some truth in that argument. Increasing taxation will always create perverse incentives for mining companies. However, this is not an argument against increasing taxation per se. Rather it is an argument for why taxation must be part of a broader strategy that takes safety and environment into account. Indeed such a strategy much also bring into line how any windfall revenues are managed to empower local people and avoid the “Dutch disease”. Its therefore simply wrong to suggest again that higher taxation per se would be the source of these potential difficulties. We can have both high revenue and a good environment if careful thought was given to these issues.

Reason 4 : The profit variable tax does the same job as windfall tax

Argument: People who argue constantly for the windfall tax have a poor grasp of taxation issues or basic economics. It is quite obvious to everyone that the removal of the windfall tax will not lead to loss of government revenue as the variable tax still captures any windfall gain that may arise in the mining sector. Infact it is better because it ensures that mining companies are not being driven out of business by explicit accounting for cost of investment.

Response: This argument demonstrates complete ignorance of the common wisdom of tax collection. Although many would agree that theoretically the profit variable tax can go some way in capturing the necessary revenue from higher copper prices, a windfall tax is easier to implement. It is also easier for the public to check how much revenue government is getting in its coffers. With a profit variable tax it is an accountant's job! Multi national corporations love profit variable taxes because it is easy for them to hide their profits through inflated costs and so forth. Simply put, the mining companies have smarter accountants than the Government. This is why the mining companies pushed for removal of the windfall tax. They knew they'll pay very little. It is also the reason why all the donor partners have concluded the status quo is not desirable, with some calling it "depressing”. Simpler taxation mechanisms are key to improving collection.

Reason 5: The “certainty principle” favours the status quo

Argument: The long-term outlook for copper mining in Zambia is still very uncertain following the period of government led ownership prior to liberalisation. . Investors don't have sufficient confidence that government is committed towards an open investment policy. Constantly changing the fiscal regime whether for good reasons or not does not inspire investor confidence. What we need is certainty and stability that reduces the risks to long term investment. Having undertake reforms in 2008 and 2009, we need a period of calmness to settle things down. We perhaps can come back to this issue in 2015 or beyond. We must learn from successful countries like Chile, Australia and Canada who don’t arbitrary change their mining taxation regimes.

Response: The point regarding certainty is perfectly valid, but it misses the more fundamental question – what drives certainty? Certainty is derived from ensuring that you have a mining settlement that has the full buy-in of all Zambians. Otherwise, every government that comes along will constantly alter its mining policies. This calls for a Zambian solution, not an MMD or PF or UPND solution. The approach to mining policy must therefore be necessarily consultative and transparent. It is not just about the level of taxation but "how" you get these stable mining policies The mining companies need to realize it’s in their long term interests to push for transparency - deals made under the table are not sustainable. The approach should be consultative and transparent. These are the foundation of “rule of law”. At present there’s no rule of law in this area because government has acted without the people’s consent. It should also be noted that the suggestion that other countries are not changing their taxation regimes is blatantly wrong as can be found here.

Reason 6: ZCCM-IH is doing its job – its about empowerment not revenue

Argument: It is disingenuous to claim that Zambia does not benefit from mining because we are also owners of these mining companies! ZCCM –IH is a state owned venture and it owns 20% plus shares in joint venture with foreign mining corporations e.g. FQM’s Kansanshi and Vendata’s Konkola . Therefore as the transnational companies soar in their mining profits ZCCM-IH gains significant windfall. A "them Vs us" approach does not therefore quite reflect reality on the ground, where ZCCM - IH is a big player with assets over $1bn. When you attack mining companies, just remember you are also an owner of those investments! For example, recently we saw huge dividends of around $18m to the Zambian people by KCM.

Response: It is true that ZCCM-IH does have interests in many of these companies, but it hardly possesses a controlling interest stake in any of the key joint investments. More worryingly it’s been clear for a while that ZCCM –IH has not been receiving meaningful dividends from its jointly owned projects. The $18m hardly qualifies as "huge". A fact which led to rumours last year that government was planning to convert these financial liabilities into equity, thereaby raising substantially its stake in the mines. That the government recognised this possibility is a clear testament that the ZCCM-IH model has not worked. Indeed, what seems to concern many people is that ZCCM - IH is not "empowering" ordinary Zambans. If ZCCM-IH was owned by ordinary Zambians a potential argument can be constructed that some money does filter back to ordinary Zambians via the "theoretical dividends". ZCCM-IH is currently listed in Lusaka (alongside London, and Euronext Stock Exchanges), with the government owning 87.6% shareholding, with the remaining 12.4% held by private equity holders largely abroad. Unfortunately the whole venture is not very transparent! According to foreign private equity holders in ZCCM-IH the company has never published its financial report for nearly 4 years! Its inventories are also not formalised! Remarkable for a listed company! It is hardly the sort of company one wants to appeal to as the reason for not increasing mining taxation. On the contrary, it beggars belief that many Zambians do not even realise that ZCCM-IH is a huge part of the reason Zambia is not benefiting from its vast reserves of copper.

Reason 7 : We are already benefiting through employment

Argument: Investment in Zambia has grown significantly, as much as $5bn has been invested in the mines. Without the current fiscal regime Zambia would never have the sort of investment it has had. Indeed part of the reason why Lumwana was built was due to the favourable regime, For 25 years, Zambia had no new mines opening, now we see plenty of new ventures being proposed under the visionary policies of the MMD led government over the two decades. Significant jobs have been created from new investment opportunities. Zambia may not be benefit as much as we all would like from mining taxes but it is benefiting significantly from new jobs. As His Excellency President Rupiah Banda has helpfully reminded us "we must ensure that we do not kill the goose that lays the golden egg. There is little point in taking in a few million dollars in tax if thousands of jobs are lost as a result”. We have seen that employment has risen from 22,000 jobs in 2000 to 48,000 jobs in the mining sector because of new investments. Any appraisal of Zambia's mining policies must account for the huge benefits we have got from this extraordinary ramp up in job creation. Our approach must be to continue allowing more money to come into the economy to create jobs.

Response: The argument as formulated is misleading for three reasons. First, without doubt Zambia has significantly increased foreign direct investment to the mining sector. But the fundamental question again is what has driven this investment? As the response to Reason 1 suggested its broader issues related to political stability, cheap / diverse labour and, most importantly, prevailing global economic forces. Secondly, the employment argument is easily rejected because the counter-factual is all wrong. The so called jobs created by the MMD led government of the last two decades are essentially the jobs they destroyed through the disastrous privatisation project of the early 1990s. But suppose we can allow the argument that these are new jobs how far does the argument go? Not very far because the real central question of course relate to the “quality of jobs”. The argument regarding job creation treats jobs as homogeneous and an end in themselves. The goal of government is to provide a conducive environment where individuals can create value adding jobs and thereby foster wealth creation. Pointing to jobs built on casualisation is not wealth creation.

Reason 8. We have corporate social responsibility!

Argument: There are many companies doing very good social responsibility projects. For example First Quantum Minerals has done much rehabilitating roads in Ndola. Similar Konkola Copper Mines is working to empower the Luano Community in Chingola through an innovative goat draft project - an interesting alternative to microfinance. Lumwana recently pledged to spend K4bn on the local area, including plans to launch a multi-million Kwacha programme to diversify its local economy in Solwezi away from dependence on mining. These are great initiatives that should be supported through lower taxation.

Response: Corporate Social Responsibility (CSR) is a positive undertaking but it is at best a distortionary second best scenario. The ideal scenario is that government should tax mineral resources sufficiently in a way that profits local people and does not impact negatively on the environment and safety of workers. The government is currently not pursuing the ideal and therefore our efforts should be directed at ensuring it does. The more serious problem with the argument is that it ignores the real manace of CSR. Such initiatives, though spun as “social projects” are essentially "bribes" to keep local people quiet. Firms do not engage in "social responsibility", they practice "shareholder responsibility". The projects mentioned in the argument should therefore be rightly seen as a small price that mining companies have decided to pay local people in Ndola and Solwezi lest they become agitated at the lack of development in the area and demand the Government to do more to tax the mine (which would be bad news for the shareholders).

I have set out the above arguments and responses for three reasons.

First, I wanted to bring all the arguments / counter-arguments together in one place for ease of reference.

Secondly, I believe both sides have reasonable arguments to make and what we need is actually dialogue rather than speaking past each other.

Thirdly, often in economic analysis it’s not black or white – the question is how one weighs up the pros and cons. If this post helps people approach other issues in similar manner, then we would have progressed how debate ought to be had. I trust that readers will find these arguments and responses useful.

More importantly, it is hoped that I have tried to make the best possible "argument" and the best possible "response". Where a "reason" appears to be missing, this should be cited and it can be added provided it is distinct from the above eight reasons. If its not added, I will respond explaining why I don't think that particular reason is distinct.

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LETTERS - Reinstate windfall taxes

Reinstate windfall taxes
By Edwin Zulu
Tue 18 May 2010, 18:10 CAT


It’s absurd that this government is not ready to introduce windfall taxes in the mines on account of fearing investors to flee, citing an example in Australia where investors probably fled because of taxes.

First, Australia is in a different hemisphere and has different environment with Zambia as well as rules.If the investors there fled it should not bother us so much because we have our own ground rules.

It is a shame and a crime that mine investors should pay $77 million where they reaped $2 billion in a year. Even in church you have to return 10 per cent tithe plus offering which could amount to more money.

Is this happening in other copper-producing countries where investors pay less tax?
Somebody is pocketing the money for selfish use and not considering the masses.
Can a Zambian investor pay tax of less than 1 per cent in Europe or China?

This is neo-colonialism and neo-imperialism which Rupiah Banda's government has allowed sidelining the indigenous people from benefiting in their own country. Rupiah's government is corrupt and reaping where it did not sow than Levy's which was a government of laws and not men.

Re-introduce windfall tax now. Or are you getting your palms oiled at the expense of the majority?

Osatudyela masuku pa mutu.

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Give farmers money when they sell their produce, Bishop Lungu urges govt

Give farmers money when they sell their produce, Bishop Lungu urges govt
By Christopher Miti in Chipata
Sat 22 May 2010, 04:01 CAT

CHIPATA Catholic Diocese Bishop George Lungu has urged the government to ensure that farmers are given their money as soon as they sell their produce. In an interview in Chipata on Friday, Bishop Lungu, who is also Zambia Episcopal Conference (ZEC) president, said farmers needed money urgently to solve their problems.

“Government should ensure that farmers are given money in good time after selling their crops. It shouldn’t be after five or six months. Why, what is the problem? If they Food Reserve Agency buy their maize let them give the farmers their money as quickly as possible because they need the money,” Bishop Lungu said.

“Again that’s another challenge because you see after selling they have receipts that show that they have sold their maize to FRA but they don’t have the cash. They are not going to use that receipt to buy things from the market, they are not going to use that receipt for the school fees and so on. They need cash.”

He said if the government buys maize in good time but fails to pay on time, the whole marketing exercise becomes fussy. Bishop Lungu said the government should establish markets close to farmers.

“Government should ensure that markets are close to a farmer and they did not give a chance to a briefcase buyer to reach the farmer first because people are desperately in need of money. They need money for school fees, they need for paying at the hospital,” Bishop Lungu said.

Bishop Lungu said markets should also be accompanied by good road network.

And Eastern Province FRA coordinator Godfrey Munyoro said the satellite depots had been increased in most districts of the province.

“I think FRA and the government have heard the cries of the farmers, so the satellite depots have been increased from seven to 15 in the province, apart from Chama and Mambwe. In Mambwe, we never used to buy maize there but last season we started in two satellites. But for this season the satellites in Mambwe have been increased to three,” Munyoro.

“Then in Chama we had seven satellite depots, six of which were being managed by FRA, then the seventh one was managed on behalf of Chama District by Isoka District that is Chibale. So basically from the six that were being managed by Chama have increased to ten but if you include Chibale then you are talking of eleven satellite depots,” he said.

Munyoro urged the farmers to ensure that the maize was fully dry before taking it for sale.

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We’re sitting on a time bomb, warns Mpundu

We’re sitting on a time bomb, warns Mpundu
By Ernest Chanda
Sat 22 May 2010, 04:02 CAT

LUSAKA Catholic Archbishop Telesphore Mpundu has warned that there will be more violence in the run-up to 2011 general election because cadres have attained the status of militia. And Archbishop Mpundu has said the National Constitutional Conference (NCC) has mutilated the core content of the Mung’omba draft constitution.

In an interview, Archbishop Mpundu said the levels of intolerance exhibited so far could blow the country into flames if cadres are not caged through legal instruments.

“In 1991, the so-called ‘New Political Dispensation’ was announced with flair and fanfare but this ‘New wine’ of plural politics to this day is contained in ‘Old Wineskins’ and no amount of recycling has produced the desired results” Archbishop Mpundu said. “Political intolerance and downright hooliganism is the order of the day. Consequently the cadres have resurfaced with a vengeance.

These cadres have attained the status of militias capable of defying the law and daring the law enforcers by ferrying their members to any part of the country to carry out their evil mission of terrorising and bullying helpless citizens.

“If the just-ended Mufumbwe by-election is anything to go by, the nation has just been treated to a dress rehearsal of the drama that is sure to unfold on the Zambian political stage in the run-up to next year’s elections. The police, ill-trained, ill-equipped, despondent, unmotivated, outnumbered and encumbered by blatant political interference are ill-prepared to protect the public. They can only sit and watch powerlessly the tragedy waiting to unfold right in front of their very eyes and those of the entire nation. This scenario does not augur well for the public’s confidence in the Police Service to protect them and is sure to drive people to seek refuge in their own ‘defence strategies’.”

Archbishop Mpundu said the violence experienced in the Mufumbwe by-election was a national shame that deserved an investigation.

“The so-called ‘peaceful Zambia’ is in fact a tinderbox that can go up in flames any time unless these outlaws called cadres are effectively reigned in and caged through legal instruments. In the Mufumbwe by-election fiasco, innocent citizens have been brutalised and several people have been killed but the authorities don’t see this disaster as serious enough to warrant a speedy inquiry by an independent and professional body in view of bringing the culprits to book and delivering justice to the affected people and bereaved families,” Archbishop Mpundu said. “In civilised nations heads of the relevant government wings responsible for security, law and order would have rolled and resignations demanded by the citizens and tendered. Such decency doesn’t exist in ‘Peace loving Zambia’! The Mufumbwe by-election fiasco is a national shame!”
Archbishop Mpundu said if people lived in fear for too long, they were bound to react and that could lead to civil disobedience.

“From January to March 2002, tension was palpable in this country in the wake of the December 2001 disputed elections and the subsequent electoral petitions. There was tension again in the aftermath of the 2006 elections and some people were killed. Tension was dangerously much higher after the 2008 presidential by-election. We are sitting on a time bomb unless the cadres are outlawed and disbanded and the much needed and long overdue electoral reforms are effected before next year’s elections. Kenya is a very good lesson for us to learn from and those who think that the Zambian people’s patience and love for peace are limitless are burying their heads in the sand ostrich-like. Fear is a very potent emotion. People’s fear of political violence, fear of threats from the political elite who threaten them with unspecified reprisals before, during and after elections can ignite the already explosive situation that would make the post election violence in Kenya appear like a Sunday morning picnic.”

And Archbishop Mpundu has said Zambia may never achieve anything on constitutional reforms because of selfishness from successive regimes.

“On constitutional reforms, the truth is that since Zambia’s independence nearly 46 years ago, successive regimes have not really been interested in a people-driven constitution but in a document that gives the government of the day an easy means to hold on to power,” he said. “The administration that assumed power after the 2001 elections had made it very clear during the campaign that constitutional review was not on the list of its priorities.

Public pressure, however, forced the administration to change its stance and the Mung’omba CRC Constitution Review Commission was appointed.

Unfortunately, the administration hijacked the roadmap, the process and in the end even the core content of the Mung’omba CRC Draft Constitution has been mutilated by the NCC.

“The Church Mother Bodies’ decision not to take part in the NCC has been more than vindicated. After so much time and enormous financial and other resources expended, we are back to where we were in 1991, namely still in the ‘Dark Age’ of our political history, only that the ‘Dark Age’ is much darker this time around. The truth that will free us is that each successive government views the Constitution as its way of holding on or retaining political power instead of regarding it as the most important if not the only tool to engender genuine and sustainable social, economic and political development. The meaning of the experience is that successive regimes including the present one seek to erode our liberties in every way possible. What has obtained at the NCC will no doubt produce a voluminous document purporting to be a new Constitution but in fact it is one from which the soul has been sucked out and its spirit smothered by politicians colluding with unpatriotic citizens.”

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‘Zambia’s political leadership is losing it’

‘Zambia’s political leadership is losing it’
By Masuzyo Chakwe
Sat 22 May 2010, 04:01 CAT

PROFESSOR Nkandu Luo has observed that Zambia’s political leadership is losing it. In an interview, Prof Luo who is former health minister said even if the word leader was used for certain people in the country, Zambia today did not have people worth calling leaders.

“I don’t think that Zambia today has people that if you follow the definition of a leader can be called a leader because leadership is anchored on various principles and one of the principles of leaders is love for others and the second is humility and the third is selflessness. And we don’t see these kinds of things in the people that are referred to as leaders,” Prof Luo said.

“All you see is selfishness, they must get what they get at all costs. So if it means killing a few people, those people have to be killed like we saw in Mufumbwe. I mean people being hacked, we saw a report of children dying because somebody just went and drove where people were celebrating. I think that is unacceptable and yet we do not hear what has happened to these people. Have they been prosecuted? It’s now like the lives of Zambians now don’t mean anything. What means something is the people that are providing leadership for as long as they are in the comfort zone and I think this is totally unacceptable.”

She said the violence currently being experienced in Zambia particularly at election time was very unfortunate. Prof Luo said leaders and all people needed to remember that violence was a big concern for women and in countries where it had broken out, the first victims were women and children.

“What happens when there is violence is that they take advantage and rape women or if people have to run away, the women always want to carry their children with them. The men will run away and the women and children will be casualties. I think it is important for the women of Zambia to take this very seriously with the leadership of the country so that this comes to an end especially in the run-up to the 2011 elections because if it is this bad now, it is likely to get worse in 2011,” she said.

“And I think as women, we need to reflect on this and we need to say to the leadership of the country that whoever is perpetuating violence, and we all know anyway, must bring it to an end because it is not in the interest of anybody. It’s not in the interest of the leadership, it’s not in the interest of the women and children and it is not in the interest of the populace of Zambia.”

Prof Luo also said the language being used by leaders in the country was unfortunate. She said there was a lot of persecution and malignment in the language. Prof Luo cited the recent attacks on Lusaka Catholic Archbishop Telesphore Mpundu.

“I as a Catholic, I was very sad with the kind of the things they talked about Archbishop Mpundu and what was so sad was that some of the perpetrators of Archbishop Mpundu have suffered persecution but because it suits them now, they should persecute another person. I think that is unacceptable,” she said.

Prof Luo said as a Zambian, she was not interested in knowing who was sick and who was suffering from what. She said she was only interested in her bread and butter.

Prof Luo said the leadership of the country needed to tell Zambians what they would do about the health sector, education standards, roads and issues at institutions like University of Zambia (UNZA).

She said she recently returned from Northern Province where the road network was terrible. Prof Luo said the road between Serenje and Nakonde was in a real bad situation and yet leaders were more interested in attacking each other on health issues.

“I am not interested. I want to hear who is going to repair the road and when so that people travelling on that road have a comfortable ride and also reduce the number of accidents on that road. As Zambians we need to make leaders accountable and it is important leaders account for the violence that has taken place and those responsible apologise and make a commitment that it will not happen again,” said Prof Luo.

Politicians in the country have in the last few weeks engaged in personal attacks, questioning each other’s health and calling names. The attacks started before the by-election in Mufumbwe in North Western Province, which was later marred by violence and loss of life.

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ZRA sit-in enters day 3

ZRA sit-in enters day 3
By Namtama Mundia
Sat 22 May 2010, 04:01 CAT

Police officers talking to ZRA union leaders as the sit-in enters day three without any solutions to their demands - Picture by Collins Phiri

UNIONISED Zambia Revenue Authority (ZRA) workers’ indefinite countrywide go-slow yesterday entered day three. The workers rejected the eight per cent increment offered by management, demanding a 25 per cent rise.

A check at the head office in the morning yesterday revealed that workers were not performing their duties, despite having reported for work and a long queue of customers who were trying to make their payments was seen.

The security at the premises had been re-enforced by paramilitary police while the main gate, which is normally open was found closed. One of the workers, who sought anonymity, said the go-slow by employees had continued despite their going back to work.

“The workers are still on go-slow, they want the Commissioner General Chriticles Mwansa to address them but he is not willing,” the source said.

“So the workers are just doing their own things and others have gone back to their homes. We have not heard from the union leaders because they are still having a meeting with the minister labour minister Austin Liato.”

When contacted, union acting general secretary Shaderick Kalunga said he could not comment on the matter because he was in a meeting with Liato.

ZRA finance secretary Happy Bwalya on Wednesday advised the workers to go back into their offices so that the situation is not jeopardised.

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Mangani was open to abuse – Rupiah

Mangani was open to abuse – Rupiah
By Chibaula Silwamba
Sat 22 May 2010, 04:01 CAT

President Banda congratulating Western Province permanent secretary Seth Muleya while newly-appointed home affairs minister Mkondo Lungu (l) looks on. This was after the duo was sworn in at State House yesterday - Picture by Collins Phiri

PRESIDENT Rupiah Banda yesterday disclosed that he demoted former home affairs minister Lameck Mangani because he became too open, too exposed and people began to take advantage of him, thereby endangering national security.

And President Banda advised civil servants not to be arrogant to Zambians. Speaking when he swore in Mkondo Lungu as Mangani’s replacement at State House, President Banda said he had great liking for Mangani but he failed to perform to satisfactory standard.

“I just want to say this that it’s not an easy thing for a President to drop a senior minister, especially a senior minister that he knows personally and has a great liking for as a person. But there is something more than me and you; the people out there, the interests of the Zambians,” he said.

“If I am satisfied that a minister is not performing up to the standards that he should perform, especially in your ministry, I have no choice but to move.”

Mangani was demoted to the position of Deputy Minister of Science, Technology and Vocational Training. President Banda said the Minister of Home Affairs, the permanent secretary and members of staff in the ministry were endangered species.

“Everybody targets you for whatever they want to do which is not correct according to the laws of this country. You have to protect yourself,” President Banda said.

“I had to ask my colleague Mangani to stand down and demoted him because I felt he was not ready for the task of Minister of Home Affairs. He was too open, he was too exposed and people were beginning to take advantage of him.”

President Banda said he was receiving reports about what was happening.

“In my position, I hear many things. I don’t hear everything, but many, many things I hear them. The same people that come to you and say, ‘do this, do that’, the same people find the way to come and tell me or they go and tell somebody and that somebody thinks it is not right and come back and report to me,” President Banda said.

“So I want to say that as I advise you, I am also giving a reason why I have had to ask Honourable Mangani to be demoted to the position of deputy minister. It’s not actually a demotion because deputy minister is part of my government. I have given him an opportunity to come down and learn what it is to be a minister at that level; you are number four in the government hierarchy after the Vice-President, comes the Minister of Defence, comes yourself.”

President Banda said the portfolio of home affairs minister was a very important one in the Zambian government establishment.

“Don’t allow people to take advantage of you. I have no doubt that you will not allow that. You are an experienced person. I know your history very well. I know where you are coming from and I know you know what security is all about and that is why I feel comfortable that you are available,” President Banda said.

“When I called you and asked you to come and see me, I didn’t tell you it was Ministry of Home Affairs. I just said I wanted to work with you and you said you were honoured. I am honoured too and grateful that you have agreed to work with us. I hope that the people out there will see what we are trying to do.”

President Banda said his appointment of Lungu, the only parliamentarian for UNIP, was in line with his vision to work with any patriotic Zambian.

“He Lungu belongs to UNIP, is a member of parliament for UNIP. I am president of MMD. However, this is very much in line with my vision to work with everyone regardless of what political party they come from as long as I am satisfied that they are truly patriotic, that they are Zambians who care about the interests of all Zambians,” President Banda said.

“Knowing you as I have done for many, many years now I am satisfied that looking for a mature, qualified Minister of Home Affairs, which perhaps is one of the most difficult ministries in any government.”

President Banda said Lungu was eminently qualified for the ministerial position.

“I have received nothing but accolades for your appointment from all quarters of our society. People feel that you are qualified to look after their security, to look after them and this country, all parts of our country,” President Banda said.

“Every Zambian who is competent can be called upon, regardless of what position he is holding, what political party he belongs to or where in the world he is if he is a Zambian and we need him, we will call him, it’s up to him to say yes or no. It’s up to them to say yes or no. I am very grateful that you agreed. We are counting on you to assist us to run this country to the satisfaction of the Zambian people.”

And speaking after he swore in Seth Muleya as permanent secretary for Western Province to replace Ikenuke Noyoo, President Banda said the appointee was a an experienced civil servant whom people everywhere he worked from spoke well about.

“You will be happy to know that wherever I have gone, be it in the North-Western Province where you have worked, people have nothing to say but good about you. Your attitude towards the people that you are serving, your humility you are giving, you are willing to work, sacrifice everything in order to work for the people that you were appointed to serve,” President Banda said.

“This is just important to all the other leaders here. I am pleased about the good report I have received about you everywhere where you have worked that you are a true Zambian patriot and a true civil servant. It’s not easy when you are permanent secretary to satisfy everybody but people do know your limits too; they know that you can’t do this, you can’t do that. One thing people can’t take is arrogance from their public workers.”

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(NEWZIMBABWE) Zim ratifies trade pact with SA

Zim ratifies trade pact with SA
21/05/2010 00:00:00

ZIMBABWE has finally ratified a trade pact agreed with South Africa which is aimed at the promotion and reciprocal protection of investments between the two countries.

Ratification of the Bilateral Investment Promotion and Protection Agreement (BIPPA) comes months after the deal was signed by economic planning minister Elton Mangoma and South Africa’s trade minister Rob Davies in Harare last November.

The economic planning ministry said the BIPPA came into effect on May 15 this year, but gave no reasons for the delay in its ratification.

“The purpose of the agreement is to stimulate individual business initiatives and increase prosperity in both countries through the creation of favorable conditions for investment by South African investors in Zimbabwe and Zimbabwean investors in South Africa," the ministry said in a statement.

Negotiations for the deal started in 2002 and were driven by both governments’ desire to signal to existing and potential investors that they would abide by international norms regarding property rights.

South African companies – by far the largest African investors in Zimbabwe’s economy – were particularly keen to have anxieties about the security of their investments allayed in the wake of the country’s land reforms.

"The agreement provides legal certainty for those engaged in investments in Zimbabwe and we are committed together with the Zimbabwe government that all the commitments that are in this agreement are honoured.

"This agreement will provide the legal security that is required by present and future investors in this country." Economic Planning Minister Elton Mangoma said when the agreement was signed last year.

However, efforts by South African farmers whose land was acquired for resettlement to have the agreement cover such properties were unsuccessful with both countries insisting the deal would not be applied retrospectively.

A clause in the agreement reads: “the agreement applies to all investments, whether made before or after the date of entry into force of (the) agreement, but shall not apply to any property right or interest compulsorily acquired by either Party in its own territory before the entry into force of this Agreement”.

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Zim firms eye Ghana’s oil sector

Zim firms eye Ghana’s oil sector
by Business reporter
22/05/2010 00:00:00

ZIMBABWEAN companies are said to be keen to venture into Ghana to take advantage of investment opportunities in the West African country’s emerging oil and gas industry.

Zimbabwe’s Ambassador to Ghana Tendai Musaka told a meeting discussing the Ghana-Zimbabwe business summit set to be held in Accra at the end of May that companies were looking at downstream opportunities in the oil sector.

"The Zimbabwean private sector is particularly interested in the downstream activities of the emerging oil and gas sector in Ghana, and is prepared to invest in construction, housing, and other service industries associated with oil production in Ghana," she stated.

After years of casting envious looks at its oil-rich neighbours, Ghana recently announced significant offshore oil discoveries in a development expected to transform the country’s economy. Ambassador Musaka said Zimbabwe, which is emerging from years of economic decline, has the capacity of take advantage of opportunities arising from Ghana’s discovery.

"We have the capacity to pool resources to invest in Ghana's oil sector through joint ventures so that we can contribute to the development of Ghana's economy," she added.

Downstream opportunities in Ghana's fledgling oil and gas sector include the provision of accommodation, material and equipment supplies, transportation, storage and distribution, consultancy and other rig-related services.

The total value of these services is estimated at US$ 5 billion annually.
Masuka said Zimbabwe was also ready to form partnerships with Ghana's private sector to promote tourism services, transportation, banking and insurance in the areas of the oil find.

Ghana is expected to start pumping from its offshore wells this year with predictions that the country could eventually produce up to 10 billion barrels of oil. Additional reporting by JoyOnline.

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(NEWZIMBABWE) MDC fury as Chiweshe named Judge President

MDC fury as Chiweshe named Judge President
by Staff Reporter
21/05/2010 00:00:00

THE MDC reacted with fury on Friday after President Robert Mugabe named George Chiweshe, the controversial former head of the Zimbabwe Electoral Commission, as the new Judge President of the High Court.

Party spokesman Nelson Chamisa said Prime Minister Morgan Tsvangirai had not been consulted on Chiweshe’s appointment – the latest strain on the governing coalition formed in February 2009.

“We’re gobsmacked,” Chamisa said. “This is another act in addition to the catalogue of GPA [Global Political Agreement] violations and President Mugabe’s unilateralism. Zanu PF pretends inclusivity, but acts exclusivity.”

Chiweshe was ZEC chairman when election results from the March 2008 elections were delayed by close to a month – analysts said because Zanu PF was trying to manage its first electoral defeat after an uninterrupted 28-year rule.

The MDC says the new Judge President's impartiality is questionable.

In naming Justice Chiweshe as Judge President, Mugabe promoted the former incumbent Justice Rita Makarau to the Supreme Court.

The President also appointed three new High Court justices – magistrates Andrew Mutema and Garainesu Mawadze as well as prominent Bulawayo lawyer Nicholas Mathonsi, brother to Industry and Commerce Minister Welshman Ncube.

Chamisa said the latest appointments by President Mugabe followed on his "unilateral altering of ministerial mandates; the gazetting of the indigenisation regulations; the awarding of mining concessions to South African companies; and the appointments of the Reserve Bank governor and Attorney General" without consulting Tsvangirai and Deputy Prime Minister Arthur Mutambara, the third principal in the coalition government.

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(TALKZIMBABWE) Ayatollah Khamenei commends Pres Mugabe

Ayatollah Khamenei commends Pres Mugabe
By: Floyd Nkomo
Posted: Thursday, May 20, 2010 8:08 pm

IRANIAN Supreme Leader Ayatollah Ali Khamenei on Monday commended President Robert Mugabe for resisting political interference by the Western powers, pledging Tehran’s continued support for Zimbabwe.

Speaking with President Mugabe in Tehran on Monday on the sidelines of summit of the Group of 15, an offshoot of the Non-Aligned Movement, Supreme Leader Khamenei also applauded "strong, deep-rooted and friendly ties between Iran and Zimbabwe".

President Mahmoud Ahmadinejad visited Zimbabwe last month to strnegthen ties with Zimbabwe. He made similar statements as the Ayatollah.

The Islamic republic is at loggerheads with Western countries who have pressured Tehran on its nuclear energy programme, suspecting Tehran intends to acquire nuclear weapons capabilities.

The summit was attended by the presidents of Algeria, Brazil, Senegal and Sri Lanka in addition to Zimbabwe.

Addressing the one-day gathering, President Mugabe launched a broadside at the United States and Britain, accusing them of “abusing the United Nations Security Council to bully and threaten smaller countries.” He reiterated his support for Iran’s controversial nuclear programme, which he had similarly endorsed during Ahmadinejad's visit.

Khamenei rallied developing countries in Africa, Latin America and Asia to strengthen ties to push development.

"The meddling trait of world powers is the scourge of humanity and the only counter measure against this is increased cooperation between independent states," Press TV of Iran quoted Khamenei as saying.

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(TALKZIMBABWE) Exploration begins at Turk and Angelus Mine complex

Exploration begins at Turk and Angelus Mine complex
Posted: Thursday, May 20, 2010 12:07 pm

NEW Dawn Mining Corporation has commenced three separate exploration programmes at its Turk and Angelus Mine Complex in a bid to increase its gold resource base. Turk and Angelus Mine Complex consists of three mineshafts namely — the Main vertical shaft, the Armenian shaft and the Angelus shaft.

“Over the past several months New Dawn has advanced three independent exploration programmes at its Turk and Angelus Mine Complex that are intended to not only add to our existing gold resource base, but may also add a fourth operating section to the mine complex,” said the company’s president, Mr Ian Saunders, in a statement.

He said the exploration programmes would be funded from operating cash flow from gold sales generated from gold produced at Turk Mine.

“The three separate underground exploration programmes at Turk and Angelus mines complex are aimed at increasing New Dawn’s gold resources. Exploration has commenced in a new area located west of the Armenian Shaft.

“Phase two of the underground diamond-drilling programme has commenced in the area west of the Armenian shaft. The two-phase programme has been designed to cover the area from four Level and 12 Level along the approximately 100 metres of newly identified strike,” reads part of the statement.

New Dawn said the area of Batyali it was now exploring was approximately 240 metres deep.

“The section is expected to contain approximately 650 000 to 900 000 tonnes of mineralised material.”

New Dawn said it expected the first phase of the drilling to be completed in the third quarter.

Gold mining companies have embarked on various activities to increase output following the liberalisation of the sector by the central bank last year that allowed miners to look for own markets and get prices prevailing on the international market for their mineral.

The measures have seen companies once placed on care and maintenance resuming operations.

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Ngwenya ties Malawi’s success in agriculture to govt subsidies

Ngwenya ties Malawi’s success in agriculture to govt subsidies
By Mutale Kapekele
Sat 22 May 2010, 04:00 CAT

COMESA Secretary General Sindiso Ngwenya says Malawi’s agriculture is thriving due to the government fertiliser and farming inputs subsidies. Ngweya clarified that Malawi was not using Genetically Modified Organisms (GMO) to improve its agricultural yields.

He said Malawi was using high breed seeds that were not GMO to increase their agricultural yields from 850 kilogrammes per acre previously to 2.2 tonnes per acre after the improved seeds were introduced.

During the Alliance for Commodity Trade for Eastern and Southern Africa (ACTESA), the specialised agency of COMESA, stakeholders meeting last week, Ngwenya urged member countries to emulate Malawi that had improved its agricultural yields through the use of improved seed.

He said using hybrid seed would increase threefold the agricultural yields in the region and help to reduce poverty levels especially for the rural poor.

Ngwenya also said member countries would adopt under the COMESA, East African Community (EAC) and SADC tripartite arrangement, the seed harmonisation seed regulations.

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Maize crop yield hits all-time high

Maize crop yield hits all-time high
By Fridah Zinyama
Sat 22 May 2010, 04:00 CAT

ZAMBIA has produced the highest quantity of maize ever recorded in the country’s history at 2.8 metric tonnes for the 2009/2010 farming season. There has been a marked improvement in other major staple crops such as sorghum, rice, groundnuts, Irish potatoes and cassava as well.

Presenting the crop forecasting survey for 2009/2010 agricultural season and the food balance status for 2010/2011 marketing season, agriculture minister Peter Daka said the last time Zambia had come close to this high production was in the 1988/89 season when 1.9 metric tonnes of maize was produced.

“According to the crop forecasting results, the food security situation in the country is favourable,” he said, adding that once again Zambian farmers had this year managed to produce enough food to feed the nation as well as a substantial surplus to allow for both adequate replenishment of the national strategic reserves and exports.

Daka said due to the relatively favourable production experienced in the previous season, the country had a large amount of maize carry-over stock amounting to 298,681 metric tonnes.

“Adding the maize carry-over stock from last season to the maize production for 2009/2010 agricultural season brings the total available or supply of maize for the 2010/2011 marketing season to over three million metric tonnes,” he said.

Daka said the national food balance sheet for the 2010/2011 marketing season based on the crop forecasting survey for the 2009/2010 agricultural season indicated that the country had produced sufficient maize for both human consumption and industrial use.

“For an estimated population of 13.3 million people, the food balance sheet shows that total maize required for human consumption amounts to about 1.3 million metric tonnes,” he added.

“The estimated maize requirement for industrial use, specifically stock feed and breweries is 230,000 metric tonnes.”

Daka said when total maize requirements were netted out of total maize availability, the food balance sheet indicated that the country had recorded a maize surplus of over one million metric tonnes.

“The total maize requirement includes an anticipated government strategic reserve stock of 200,000 metric tonnes for the Food Reserve Agency,” he said.

“Total maize production this season has increased by 48 per cent or 908,473 metric tonnes, from about 1.8 million metric tonnes in the 2008/2009 season to about 2.8 million metric tonnes in the 2009/2010 season.”

Daka said the area on which maize was planted had also increased by 14 per cent or 116,802 hectares to 1,242,268 hectares from 1,125,466 hectares.

“The increase in maize this year is largely attributed to the good price farmers received last season and the adequate rains that were experienced in most parts of the country,” he said. “The relatively attractive price offered to farmers last marketing season, contributed to the increase in production this season.”

Daka said farmers also used hybrid seed rather than recycled or local seed this season in comparison to the 2008/2009 season.

“The area planted to maize and the average yield for maize has also increased thereby improving overall production. The average yield for maize in the 2009/2010 season increased significantly by approximately 34 per cent to 2.2 metric tonnes,” said Daka.



What kind of cadres do we need?

What kind of cadres do we need?
By Editor
Sat 22 May 2010, 04:00 CAT

IT is very strange that in a country that has declared itself a Christian nation people can be killed and maimed without anyone in power being concerned.

People were killed during the campaigns for the Mufumbwe parliamentary by-election. And many have been left maimed for life as a result of the politically motivated violence that rocked that very poor parliamentary constituency of our country. But to date we do not have any meaningful enquiry into what happened, into what led to that violence.

In a nation that has declared itself Christian, human life is something that should be considered to be very sacred, a gift from God to be highly valued from the moment of conception until death. One cannot claim to uphold the sanctity of life while at the same time placing the value of winning an election above human life. It would appear it was more important to win the by-election, at all costs, including the cost of human life and dignity.

There’s need for an independent and impartial enquiry into what happened in Mufumbwe. That was not a small thing because lives were lost and a large number of our fellow human beings, our fellow citizens have been left maimed for life. This needs to be investigated and the culprits brought to book. There should be no room for impunity where the life of any single citizen of this country is concerned.

It is clear that the police are not in a position to deal with this matter in a just, fair and impartial manner because they favour those in power and their cadres. The police are clearly on the side of the ruling party, its leadership and cadres. They get away with murder, with any crime they commit in the name of their party and its politics. For this reason, the police has lost the respect and trust of our people in matters where crimes are committed by those in power and their supporters. The only way left for the families of those killed to see justice and know what happened to their loved ones is through an independent and impartial special enquiry. It is also the only way those maimed for life may have a chance to know and face those who ruined their lives.

But we know that it will be very difficult for Rupiah Banda to set up such an enquiry because there’s already a prima facie case against him for inciting that violence. And the name of his chief vigilante, William Banda, has also been mentioned in connection with that violence. But nevertheless, those who seek the best for all our people should press hard for an enquiry to be set up so that there’s no repeat of Mufumbwe. If that is not done, we should brace ourselves for more Mufumbwes in the future, for veritable chaos as we approach next year’s elections.

We don’t favour violence. We hate it because it dehumanises human beings, it puts those who resort to violence next to animals. If we could bring about recognition and respect for the constitutional and human rights of all our people by peaceful means, well and good. Every decent human being would like to reach his or her objectives peacefully. But we are also realists. The only people in this country who Rupiah and his minions ask to be non-violent are those who exercise their democratic rights in our multiparty political dispensation to oppose them and challenge their hold on power. We have never seen Rupiah strongly oppose and pursue his supporters and cadres who engage in violence so that they can be brought to book and face the law. Non-violence is only preached to the opposition, its supporters and cadres, and we don’t go along with anyone who wants to teach our people non-violence until someone at the same time is teaching Rupiah and his cadres to be non-violent. What did anyone expect Hakainde Hichilema, his supporters and cadres to do in Mufumbwe when they were being attacked by Rupiah’s cadres ferried all the way from Lusaka for that purpose? And we say this given the experience of the Solwezi by-election where MMD cadres took over the policing and harassed opposition supporters and cadres with impunity. We believe opposition leaders and their supporters should protect themselves by any means necessary when they are attacked by Rupiah’s lawless cadres who today seem to be above the law – because even the police fear them, can’t touch them and run away from them when attacked instead of arresting them. They are trying to make the opposition the victim of every kind of discriminatory and unjust enforcement of the law, a permanent victim of ruling party violence. Then when they explode, you want them to explode politely! Why, you are dealing with the wrong people at the wrong time in the wrong way.

We need a different type of cadres for our political parties for our multiparty politics to flourish. We need to arrest the decline in democratic morality, ethics and values. This is causing a considerable strain on the moral standing of our politicians and their politics. We need to have cadres who conduct themselves in a civilised and democratic manner, cadres who realise that every citizen has a right to directly take part in shaping their own destiny, the destiny of their country. We need cadres who understand what it means to live in a multiparty political system and to operate in a plural society. We need cadres who are selfless and who are not taking or influencing decisions based on their own narrow interests. We need cadres who are able to subordinate their interests, including those of their political parties, to those of the nation.

We need cadres who understand the broader national and international situation and who understand the significance, relevance and role of our multiparty political system and of all the actors in it. We need cadres who view accountability to the people as an important duty of their political work. Cadres must be rooted and grounded in society and understand what their role is in transforming or democratising our nation.

We have witnessed the total absence of political education and cadre development programmes in all our political parties. There’s need for all our political parties to invest in cadre education and development programmes and strengthen their democratic political outlook. It is a crime to abuse young people by sending them on criminal political assignments. Buying young people Chibuku, Tujilijili and dagga so that they can have courage to engage in violence is criminal. It is evil to exploit the poverty, ignorance and greed of these youngsters. If these young people were given proper political education – by proper political education, we mean given a true picture of the political history of our country and the contributions each of us could make – we think many young people would be less violent in their politics, in their campaigns. They would have more respect for their colleagues in other political parties or formations. Their negative feelings would be at least partially negated and their feelings towards others would be replaced by a balanced knowledge of themselves. They would feel more like human beings. They would function more like human beings, in a society of human beings.

So it takes political education to eliminate violence. But the question is: who will be the teacher? Not Rupiah; not William because these two need to be schooled in civility and tolerance. What we are trying to say is that the choice of political leaders is something that should be done with a lot of care lest we choose people who think with their blood for leaders.

Many citizens of goodwill have warned the nation against the dangers of this intolerance and this drift towards politics of violence. It is said that “wise people walk the road that leads upward to life, not the road the leads downward to death” (Proverbs 15:24). It is also said that “sensible people will see trouble coming and avoid it but an unthinking person will walk right into it and regret it later” (Proverbs 22:3).

There’s need for us to decide what type of Christian nation we want to build in this country that is increasingly becoming intolerant and violent; what type of multiparty democracy we want to construct in this country that is increasingly becoming intolerant of opposition, plurality and diversity; and indeed we need to ask ourselves: what kind of cadres do we need or don’t we need?

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MMD in Luapula will not accept imposition of PF ‘rebels’ - Chanda

MMD in Luapula will not accept imposition of PF ‘rebels’ - Chanda
By Patson Chilemba
Sat 22 May 2010, 04:00 CAT

MMD members in Luapula will not accept the imposition of PF ‘rebel’ parliamentarians to be adopted on the MMD ticket, party provincial youth chairperson David Chanda said yesterday.

Commenting on the recent reports that chiefs in Luapula Province had endorsed the re-election of PF rebel members of parliament, Chanda said ‘rebel’ parliamentarians were not guaranteed automatic adoption on the MMD ticket.

“You know the former head of state is an experienced man, and he knows the danger of that imposing rebel PF parliamentarians on the MMD. When you are measuring an irregular object, the volume of water which is displaced is equal to the volume of that irregular object,” Chanda said. “Meaning if we can impose on the party, the other colleagues may be frustrated and leave the party, and it will not solve any problem…therefore, imposition will not be accepted.”

Chanda said the rebel PF parliamentarians should submit themselves to the norms and rules of MMD.

“The concerns are that as I take it and the other party leadership in Luapula, there can’t be an imposition on the party. They rebel parliamentarians are very much alive that where they are returning to, they will find people in that house,” said Chanda.

“They have to submit themselves to the norms and rules of the party. And anyone who is talking about parallel structures, if anyone is creating parallel structures that is a danger to the party because parallel lines can never meet.”

Recently, there were assertions that chiefs in Luapula Province, except Mwata Kazembe of the Lunda people had endorsed the re-election of PF rebel members of parliament.

And MMD sources in Luapula Province revealed that Chiluba’s ploy to force PF parliamentarians on President Rupiah Banda to adopt them as parliamentary candidates in next year’s election would lead to fallouts among party stalwarts.

The insiders said parliamentarians want Chiluba to secure them adoptions in the MMD hence their recent alignment with him, the ruling party and president Banda.
The insiders said Chiluba was trying to form parallel structures within MMD to regain his political clout in the province.

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The law on television licence is punitive, says Nyirenda

The law on television licence is punitive, says Nyirenda
By Christopher Miti in Chipata
Sat 22 May 2010, 04:00 CAT

FORMER Kasenengwa UNIP member of parliament Timothy Nyirenda has urged the government to amend the law on television licence because it is punitive.

Nyirenda told the parliamentary committee on information and broadcasting, which had a one-day sitting in Chipata to look at the mandatory migration from analog to digital system, that it was bad that some people were forced to pay TV licence when they did not watch Zambia National Broadcasting Corporation (ZNBC) television.

“The analog television system has not helped us here in Chipata. For example, when you reach the Chipata Motel area you cannot watch ZNBC TV but meanwhile all of us are forced to pay K3,000 TV licence fee. And this law which brought about TV licence is bad, punitive and should be amended,” Nyirenda said.

He said the government had not done enough to sensitize people on the migration from analog to digital system.

Nyirenda said people were already facing a lot of problems with the analog system.

Kapata ward councillor Sinoya Mwale said people especially from rural areas needed more sensitization about the transition from analog to digital.

Eastern Province FDD information and publicity secretary Frank Banda said the government should ensure that people were informed about the migration because the issue may be politicised.

Nakonde MMD parliamentarian Clever Silavwe, one of the committee members, said the mandatory migration from analog to digital need to be taken seriously.

Silavwe said the change would have a lot of effects and should not be taken for granted.

Earlier, committee chairperson Mwansa Kapeya who is also Mpika Central legislator said all nations globally would adapt to the new digital technology in 2015.

He said the International Telecommunications Union meeting that was held in 2006 in Geneva (Switzerland) decided that a change from analog to digital should be effected.

The parliamentary committee also had a meeting in Katete on Wednesday.

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Chiluba is now looking foolish, says Syakalima

Chiluba is now looking foolish, says Syakalima
By Patson Chilemba in Lusaka and Speedwell Mupuchi in Kitwe
Sat 22 May 2010, 04:00 CAT

SIAVONGA UPND member of parliament Douglas Syakalima yesterday charged that Frederick Chiluba is now looking foolish following revelations on his ‘development meeting’ in Luapula Province.

In an interview, Syakalima said it was clear that former president Chiluba’s trip to launch campaigns for President Banda had failed miserably.

“First of all, did anybody believe that Chiluba was going there for development? Because that guy is a lie himself, he lives on a lie. He eats a lie. Most of us intelligent people know that he was not going there for development,” Syakalima said. “

Who is now looking foolish, if the chief can come out in the open that ‘this is what happened?’”

Syakalima said Chiluba should not think that he could fool Zambians anymore.

“It was bad enough for us to elect him president, and should not provoke us more. It was during his reign that the health sector went back. His word that he can press the button for Rupiah Banda, he is nothing,” Syakalima said. “He overvalues himself. You know what crooks do, they overvalue themselves.”

Syakalima said in the past Chiluba could manipulate people but now many people could see through him as they had now come to know the kind of person he was.

“Let him just sit down and keep quiet since now he is no longer sleeping. I don’t know when he got healed for his heart condition,” Syakalima said. “Even for him to start doing politics when the Constitution says don’t do politics as former head of state, so all these things he is doing, he is now piling up all the things Zambians dislike about him.”

Syakalima said President Banda should not think that he could bank on Chiluba because he was just wasting his time. He said Chiluba was no longer a factor in Zambian politics.

“Zambians are not looking for anything but to remove the MMD. When curtains have fallen, it’s always better to get out of the stage,” Syakalima said.

And Change Life Zambia executive director Fr Frank Bwalya on Thursday said Chiluba is still a thief who cannot add value to any developmental meeting.

During a live phone-in Radio Icengelo programme that featured Luapula Province minister Dr Boniface Kawimbe who was explaining the ‘developmental’ meeting held in Mansa last week, Fr Bwalya said government could have afforded not having the former president at the ‘developmental’ meeting.

He said government knew well that Chiluba had a controversial character because of his overtone and the cases he was facing in court, especially the London High Court Judgment.

“I personally still believe he is a thief who stole from Zambians; a thief cannot add value to any developmental meeting,” said Fr Bwalya.

Towards the end of the programme, following Dr Kawimbe’s defence of Chiluba, that he had freedoms of speech, movement and association, Fr Bwalya again phoned and said the London High Court judgment found Chiluba guilty of stealing from Zambians.

He said according to the London High Court, Chiluba was supposed to pay back US $41 million.

“The judgment clearly said Chiluba is a thief. The government of Mr Rupiah Banda ni government yabuwelewele, you can see ubuwelewele bweka,” he said.

Fr Bwalya questioned the logic in taking people like former Patriotic Front secretaries general Charles Chimumbwa and Edward Mumbi to attend the developmental meeting.

“Dr Kawimbe, we Zambians are not happy with the inclusion of Dr Chiluba in that meeting,” said Fr Bwalya.

Dr Kawimbe had said all Zambians would prefer a president who hails from their areas.

“Luapula people are very fortunate to have produced a president (Chiluba) and we are proud of that. For many years, Dr Chiluba was not able to visit Luapula Province, this was his first time, so naturally he was going back home,” said Dr Kawimbe.

He said the freedoms of speech, movement and association were applicable to all Zambians including Chiluba.

“He (Chiluba) should be free to associate with anyone he wants; he is free to express himself on any issue,” he said.

Dr Kawimbe said people might not like Chiluba, but he had freedom of movement and association.

“Unfortunately that’s what our Constitution says. We can’t apply these freedoms in a discriminatory manner,” he said.

Dr Kawimbe earlier said parliamentarians from Luapula and not government organised the meeting in Mansa last weekend.

He said the meeting was a follow-up to last year’s meeting members of parliament from Luapula had with chiefs.

Several callers criticised the involvement of Chiluba in the “developmental” meeting in Luapula.

A Mrs Bwalya from Kalulushi said Chiluba just went to Mansa to scold other politicians.

A caller from Ndola told Dr Kawimbe he was defending everything for his job and that he was not able to see the negative side of things.

Another caller, a Mrs Chileshe from Ndola, said the country had no credible leaders to which Dr Kawimbe said voters should shoulder the blame because it was them that elect leaders.

Another caller from Mufulira wondered how perceived differences between Michael Sata and Paramount chief Chitimukulu of Northern Province could be discussed at a meeting in Luapula Province.

A Mr Phiri told Dr Kawimbe to be sincere about the Mansa meeting saying Zambians were not dull because they read between the lines.

Dr Kawimbe also said the K1 million that chiefs who attended the meeting got did not come from government but from members of parliament who organised the meeting.

He said it was not unusual for the chiefs to get the K1 million because allowances were given at all workshops.

On the appointment of opposition UNIP member of parliament Mkondo Lungu as home affairs minister, Syakalima said desperate people did desperate things.

He said people had consistently warned President Banda that Mangani was not fit to serve as interior minister.

“The man wanted to be the commanding officer of all the provinces. He became Inspector General of police. You don’t behave like that as interior minister. He told Inspector General of police Francis Kabonde to go to Mufumbwe and you saw what happened there,” said Syakalima.

“And since Mangani has been dropped, let this guy Kabonde also resign for having surrendered his powers to Mangani

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Zambia, Finland launch policy framework for investment

Zambia, Finland launch policy framework for investment
By Mutale Kapekele
Sat 22 May 2010, 04:00 CAT

ZAMBIA, with assistance from Finland yesterday launched the policy framework for investment project which is aimed at enhancing investment policy design and implementation.

The project, which will be conducted within the framework of the ‘unlocking investment potential in Southern Africa’ programme, aims to enhance investment policy design and implementation in Zambia and would use the Organisation for Economic Cooperation and Development (OECD)’s Policy Framework for Investment (PFI) as a benchmark to carry out the work.

Speaking at the launch, Finland under secretary of state for policy and development Ritva Koukku-Ronde commended Zambia for consistently strengthening the country’s business climate over the past five years.

“Private investment is a key to achieving sustainable development,” Koukku-Ronde said.

“It plays a crucial role in generating economic growth, job creation and poverty reduction. We commend the Zambian government for consistently strengthening the country’s business climate over the past five years as evidenced by Zambia’s improved ranking on the World Bank’s doing business index.”

She said the use of policy framework for investment offered Zambia a chance to increase the opportunities for attracting investments in the long term.

And commerce minister Felix Mutati said the government would continue working towards making Zambia the investment destination of choice.

Mutati said it was not enough to attract foreign investment to the country but to also be competitive by creating a conducive environment where the private sector thrived.

He said to respond to the need of an integrated approach to boost competiveness, the PFI project would engage “numerous government agencies involved in developing and implementing investment related policies.”

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Friday, May 21, 2010

(MRK) - Fraudulent Inducement, the Development Agreements and the IMF

COMMENT - I think the conditions under which Zambia's mines were 'privatised' could amount to 'fraudulent inducement' by the IMF and World Bank. The IMF made the unsupportable claim that copper prices would not rise 'within Edith Nawakwi's lifetime', in order to facilitate the privatisation of Zambia's mines at all cost, a few years before copper prices took off to historic highs. The definition of Fraudulent Inducement from

What Does "Fraudulent Inducement" Mean?

It is generally held that agreements should be made in good faith. For this to happen, all parties of an agreement should provide information that is accurate to the best of their knowledge. Fraudulent inducement refers a tort claim that can be made in instances where acts of good faith are based on information that is intentionally misleading.

A person is fraudulently induced when deceit and trickery are used to encourage her to act in someone else's favor. Generally, this also results in her acting against her own interests. Such a situation could arise, for example, if a woman decides to transfer her property to her son who is a physician based on his deceptive diagnosis that she will soon die. Since she was intentionally misled, she may have the right to seek damages for losses that occurred.

In order for a person to successfully claim fraudulent inducement, she must show that her reliance on the provided information was reasonable.

[Like, when it comes with the authority of the IMF. - MrK]

In the above mentioned example, the woman's belief in her son can be justified by the fact that he is a medical professional. If, however, her son was a painter, it may be difficult for her to convince a court that she had good reason to rely on his assessment of her health.

A person also needs to show that the fraudulent information was used as a basis for decision making. One party may make claims that deceive another party. Courts, however, tend to assess how large a role the deceptive information played in the choice that a person made.

[That is easy. The lies told to the Finance Minister by the IMF and World Bank directly led to the privatisation of Zambia's mines. - MrK]

Fraudulent inducement claims can be made with regards to both oral and written contracts.

[Like the oral assurance that copper prices would not rise within Edith Nawakwi's lifetime.

From The Post: IMF, World Bank pressured govt to privatise mines - Nawakwi

FORMER finance minister Edith Nawakwi has revealed that the IMF and the World Bank pressured the Zambian government to privatise the mines on the pretext that copper prices would not increase in 20 years. MrK]

It should be noted, however, that reliance on an oral contract may prove harmful to the aims of a person who claims that she was fraudulently induced. Courts have often ruled against such claims on the grounds that the information upon which a person relied should have been in writing.

[I would love the IMF to make that defense. Gee, you didn't get it in writing, of course you shouldn't have believed us. - MrK]

Courts have also ruled against cases in which an oral contract includes statements that are contrary to same matters that are addressed in a written contract.

There are instances, however, when a person may feel misled but the misleading party did not act intentionally.

[There is no way the IMF could know future copper prices. Therefore, they should have known that they could not possibly predict that copper prices would not rise within Edith Nawakwi's lifetime. - MrK]

Such instances often stem from the online sale of used goods. In many instances, the sellers provide descriptions using terms such as "good condition" or "almost new." These terms usually lack universal standards, meaning that one person's assessment can be wholly different from another person's. Fraudulent inducement claims brought in these cases are likely to be fruitless.

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Thursday, May 20, 2010

(HERALD) Parly summons A-G over Zambian debt

Parly summons A-G over Zambian debt
Herald Reporter

THE Parliamentary Portfolio Committee on Agriculture has summoned Attorney-General Mr Johannes Tomana to give evidence on the US$2,7 million owed to the Grain Marketing Board by the Food Reserve Agency of Zambia.

The debt emanates from a grain deal between Zimbabwe and Zambia entered into in 1998. The committee however, expressed displeasure with the failure by Mr Tomana to respond to previous invitations.

The committee also threatened to take action against him if he fails to appear at the next meeting. Committee chairperson, House of Assembly member for Chikomba Central Mr Moses Jiri (MDC-T) said Mr Tomana had failed to attend three meetings.

Speaking after officials from the GMB gave evidence to his committee, he said Parliament would take action against Mr Tomana.

The debt has been referred to the two countries’ attorneys general and Mr Tomana is expected to give evidence on the latest developments on the matter. Giving his evidence, acting GMB General Manager, Mr Zvidzai Makwenda said they were pursuing the matter vigorously.

"The issue of the Zambian debt is one that we are pursuing and pursuing vigorously.

"The US$2,7 million that is outstanding is very important for the organisation in terms of funding for our activities," he said.

Mr Jiri confirmed that the GMB had since submitted a file with the information they were now perusing.

"The information we requested was submitted and we are now studying it to see how we will proceed with the matter," he said.

The committee is investigating the delay in payment of the debt.

It also directed GMB officials to furnish the committee with details of what transpired since the time the deal was entered into.

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(HERALD) Zim, SA still deadlocked over TTDs

Zim, SA still deadlocked over TTDs
Herald Reporter

Zimbabwean and South African officials have failed to agree on the recently introduced Temporary Travel Document and the matter could now have to be handled by the two countries’ Home Affairs ministers.

Indications are that the disagreement could stem from the security features on the travel document. Zimbabwe introduced TTDs last month to replace the Emergency Travel Documents, which were easy to fake.

However, South African officials at Beitbridge Border Post have refused to accept the new document though other regional countries have seen nothing wrong with it.

Secretary for Home Affairs Mr Melusi Matshiya yesterday told Senate’s Thematic Committee on Peace and Security that talks to reach an agreement with their South African counterparts had collapsed.

"The Department of the Registrar-General advised embassies that we had changed from the ETD to the TTD and the South Africans were the first ones to be notified of the changes.

"All the internationally accepted practices were followed. If the Government recognises that document, then it is an acceptable document.

"You don’t have to subordinate yourselves to others and reveal your security features," he said.

Mr Matshiya added: "As far as I know, the position has not changed. We have talked to the (South African) embassy and this week our officials were at their embassy.

"At this moment, I would recommend that the two (Home Affairs) ministers talk to their South African counterpart because at a technical level it has failed."

The TTD has enhanced security features following an increa-se in the number of forged ETDs.

The rejection has seen South African-bound public transporters refusing to accept bookings from passengers in possession of the new document.

A senior official in Pretoria yesterday reiterated that the impasse was over procedural issues.

South African Ministry of Home Affairs spokesperson Mr Ronnie Mamoepa said: "The TTD was introduced without forewarning. I cannot give you any more information about government-to-government discussions."

Yesterday, Zimbabweans using TTDs were still being turned away at Beitbridge.

Assistant regional immigration officer (southern region) Mr Charles Gwede said: "South African officials have indicated that they are still waiting for feedback from Pretoria.

"We are also waiting for a directive from Harare on how to proceed."

Meanwhile, the principal director in the immigration department, Mr Clement Masango, yesterday said they had started computerising their Harare International Airport, Victoria Falls Airport and Beitbridge Border Post offices to detect fraudulent documents.

Appearing before the Senate Thematic Committee on Peace and Security, Mr Masango said they wanted to spruce up their operations ahead of the 2010 Fifa Soccer World Cup in South Africa that starts next month.

"I have secured funding to computerise ahead of time for the World Cup tournament and it is being done at Beitbridge, Harare and Victoria Falls.

"Funding allowing, we would have wanted to computerise more stations," he said.

Mr Masango said officials from the department were undergoing training to familiarise themselves with the new equipment.

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(TALKZIMBABWE) Memories of sobbing shadows at Nyadzonia

Memories of sobbing shadows at Nyadzonia
By: By Alexander Kanengoni
Tuesday, May 18, 2010 6:12 am

(Article reproduced from The Sunday Mail, 08 August 2004)

LAST week, I wrote in The Sunday Mail a story about my bizarre experience with a VOLVO at Nyadzonia a day after the grisly 1976 massacre. A young woman phoned and requested me to write a story about the massacre. I told her I had already written one that appeared in the Press nearly 20 years ago but she said she had not seen it because she was still very young then; please, Mr. Kanengoni, please. Suddenly, it was no longer a mere request; it was a plea. I felt trapped and wretchedly treacherous. It was as if I was refusing with something that did not belong to me but to the entire nation.

At Nyadzonia, it took us over a week to bury the nearly 2 000 people who had perished in the horrendous incident. And as we walked away from the horrible place, I was afraid to turn back and see the thousand or more sobbing shadows with their heads bowed, following us, refusing to be left behind and got forgotten.

To most of us, Heroes' Day has become synonymous with the National Heroes' Acre. Each year on the solemn day, thousands of us gather on the sacred national shrine to remember those who shed their blood for the liberation of the country. Here, we laid to rest Herbert Chitepo. There, we laid to rest Jason Moyo. And over there, Sally Mugabe. And beyond and slightly secluded and mounted on a granite plinth is the Tomb of the Unknown Soldier. And even if we might no longer have any flowers left, let us spare a moment, walk over and pause. The effortless tears tumbling out of our eyes and collecting around the pedestal are the flowers. Because the huddled shadows with bowed heads and ashen faces are still sobbing silently at Nyadzonia.

I was not at Nyadzonia when the Rhodesians attacked it. I was at Chimoio. But I was among the platoon of 30 that was dispatched to the camp soon after the news of the attack was received. Thus, I will tell the story of the massacre not as a survivor but as one of the first people who got to the scene immediately after the massacre. I am making the prompt clarification because it can only be a survivor who will be able to capture and translate into words the horror, the agony and the hopelessness of that gigantic historical misfortune.

Nyadzonia was attacked on the morning of 9 August 1976 but the news only reached Chimoio in the afternoon because the Rhodesians had blown up the bridge over the Pungwe which was the link with Chimoio. We were sent not as a relief but a security measure ahead of any help that would come to Nyadzonia.

So armed with AKs , light machine-guns and bazookas, we raced to Nyadzonia in four Land-Rovers and an armoured personnel carrier. And at the devastated bridge, we met the first survivors. Among them was the camp commander, the late Moses Mvenge, the politician from Mutare. There was no need to ask him any questions because the tragic story was everywhere for everyone to see. The survivors' torn clothes, their lacerated bodies, the terror in their eyes and the ghosts that their faces had become told the grim story. There had been a total disaster.

We abandoned the vehicles and searched for a place to cross the angry and roaring river. It took us over an hour to cross and unfortunately during the arduous process, Nyika was swept away down the leaping treacherous river. We watched helplessly as his desperate and muted cry finally drowned and suffocated in the cascading fury. No one among us knew his home name or the part of the country where he came from. He could be anyone's son or brother. At the National Heroes Acre, his memory is embodied in the Tomb of the Unknown Soldier. We proceeded to Nyadzonia.

As we trudged forward with the setting sun on our back, we came upon the first dead bodies and they increased dramatically as we got closer and closer to the camp. And then at last, we were confronted with an endless sea of dead bodies stretching in all directions and I shook my head in disbelief. There were corpses here, corpses there, corpses everywhere. There were corpses of babies strapped on their mothers' backs, there were corpses of small boys and girls. There were corpses of young men and women, there were corpses of old men and women. And the corpses had all sorts of mutilations: decapitated heads, shattered jaws, crushed or missing limbs, disemboweled entrails, scattered brains, gouged eyes, everything.

The highest concentration of the corpses was around the open space they used for their morning assembly. We would later learn from the survivors that the Rhodesians had come with their faces painted black and with camouflage, weapons and vehicles similar to those used by Frelimo, the Mozambican army. That was how the 15 000 or so refugees at Nyadzonia had mistaken them for Frelimo. And so when one of the Rhodesians stood on the pedestal at the centre of the square and blew the emergency whistle, everyone had stampeded to the square, anxious for any good news. And with everyone around the pedestal still gasping for breath, Nyathi, a recently defected guerilla commander, gave the orders to shoot. There was nothing to understand.

Then there were the flies. Swarms of swarming heavy, green bombers. They hovered from corpse to corpse, their laden stomachs bulging to bursting point. In two days' time, the worms would begin to appear on the corpses decomposing in the sun but for now, it was just the nauseating green flies. Yes, in two days' time, the fat, wriggling lethargic worms would begin to appear.

And then there was the stench of the decomposing corpses that filled the air. But like all the other things, the stench would slowly disappear from our noses and by the third day, it would have completely disappeared. And it would be left to the new arrivals to tell us that our eyes looked unfocused and that we also looked frightening and that the smell of death followed us wherever we went. Of course, that was before they too had stayed long enough to also acquire the unfocused look and to have the smell of death following them wherever they went.

And there was fire and smoke everywhere. Virtually every building in the camp had been gutted and only their charred hulks remained. The shell of the makeshift clinic run by the Red Cross across the drift stood looking up like an old woman wailing at a funeral. There were corpses strewn all over the smouldering logs and others burnt beyond recognition.

And a short distance away to the east, the Nyadzonia River writhed and cried, heaving under the weight of hundreds of bloated, floating bodies.

And then there were the injured, hundreds of them, writhing and crying like the river. Some had been shot and left for dead. Others had their limbs crushed by the rumbling steel-belted wheels of the pursuing armoured vehicles. And providing hope and assurance to some of them was one of the most difficult tasks that I had ever done.

A small girl of not more than eight whose chest had been ripped open by a machine-gun with part of her lung now exposed asked me as she calmly sat in a donga: "Do you think I will survive comrade?"

Strangely, all through that nightmare, I had not cried, not a single tear. I stood up, looked away and wept for something that was much, much more than the tragedy of the little girl. Why had I ever joined this war? Why, why, why, I kept asking myself. When I at last turned, the little girl had died. And then something inside me went out like a flame in the wind. It was as if she was waiting for someone to be close by to die. And not far way, the river continued to cry. The war would never be the same again.

Help started coming in the following morning and because the bridge over the Pungwe River had been blown up, the injured could only be ferried by helicopter to either Chimoio or Beira. And for four days, we battled to bury the dead in mass graves that a caterpillar that had been brought in from Tete was digging.

Then the skins of the decomposing corpses began to peel in our bare hands and we had no choice but to leave the work to the bulldozer. The bulldozer moved the decomposed corpses into the huge graves that it had dug and covered them up. On the seventh day, we finished writing the traumatic chapter of our chequered history but the stench of death that followed us remained. For nearly a month, people everywhere we went told us our eyes were unfocused and frightening and that we carried the stench of a decomposing death.

In the new camp outside Chimoio, the survivors sang and danced, stamping the ground: "Zimbabwe ndeye ropa baba: Zimbabwe ndeye ropa redu nemadzibaba" and then the anger and determination: "Ndati ndiudzei baba, mamboaona kupi mabhunu tinobayana."

Therefore, even if we no longer have any flowers, we should always remember to pause at the Tomb of the Unknown Soldier and let the tears collect around the pedestal.

They are to the memory of the small girl who I failed to give any hope to at Nyadzonia. She is our heroine. And there are thousands of others like her whose places of death have been forgotten. I have painful memories, rolling out with the tears from my eyes.

They are memories of the sobbing shadows at Nyadzonia and many more others who failed to arrive.

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