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(HERALD) Biti deal backfires

Biti deal backfires
Monday, 23 May 2011 23:03
Herald Reporter

FINANCE Minister Tendai Biti has drawn sharp criticism from trade uni-ons and the business community for instructing the National Social Security Authority to invest US$20 million in Renaissance Merchant Bank to bail out Mr Patterson Timba. Mr Timba was chief executive of the troubled bank which had received a US$5 million loan from businessman Mr Jayesh Shah for recapitalisation.

In separate interviews on Sunday, founding president of the Affirmative Action Group Mr Philip Chiyangwa and National Indigenisation and Economic Empowerment Board chairper-son Mr David Chapfika accused Minister Biti of interference and abusing public funds.

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"Let the market be determined by market forces. Why would the Minister of Finance want to interfere in a business transaction between two individuals?

"If it was proper for the Government to intervene in such situations, why then is the same Government not intervening to bail out Mutumwa Ma-were?

"It appears there is some conspiracy here. There seems to be an MDC-T conspiracy considering that Minister Paurina Mpariwa (Labour and Social Welfare) belongs to MDC-T, Innocent Chagonda who usually represents the MDC-T is the NSSA board chairman and he is also a board member of one of Timba's firms," Mr Chiyangwa said.

He said there were other companies that had faced challenges yet Minister Biti did not move in to bail them out.

"In Bulawayo, companies there need recapitalisation and efforts shou-ld be put in addressing those problems than intervening in things that can sort themselves out. Are we going to see all banks that have problems being bailed out? Things should be done properly. If someone borrows on certain conditions, no one should then try to interfere," Mr Chiyangwa said.

Mr Chapfika said Minister Biti shou-ld have directed his efforts at bailing out parastatals.

"We are aware that there are several parastatals that would require intervention, but Minister Biti argues that there is no flexibility yet he intervenes in private business.

"It will be extremely unfortunate if Minister Biti goes ahead and intervenes. He should concentrate on critical Government issues that require his intervention. It is my considered opinion that public funds should be first made available for the existing mandate," Mr Chapfika said.

Zimbabwe Congress of Trade Unio-ns acting secretary-general Mr Japhet Moyo said the money should at least be directed to projects which benefit wor-kers directly.

"If NSSA invests in a bank, workers are not going to benefit directly. They should at least invest in housing becau-se most workers face accommodation problems.

"The money contributed to NSSA is for workers and thus it should benefit them directly," he said.

Zimbabwe Federation of Trade Uni-ons president Mr Jacob Gwavava echoed the same sentiments.

"He (Minister Biti) says he cannot increase civil servants' salaries becau-se of liquidity constraints yet he can direct NSSA to put money on things that are not going to benefit workers directly.

"NSSA money is for workers. It sho-uld be used in areas where workers will benefit directly, for instance buil-ding houses for workers.

Mr Chagonda was last week quoted in the media as saying NSSA would consider investing in Renaissance Financial Holdings Limited if the deal has commercial sense.

Minister Biti, however, said his advise was motivated by the need to protect the banking sector.

"We don't want the banking sector to collapse, this has nothing to do with Timba (Patterson). It is about the banking sector."

Mr Patterson Timba is brother to Mr Jameson Timba who is the Minister of State in the Prime Minister's Office.

Mr Chagonda has on several occasions represented MDC-T officials, including Prime Minister Morgan Tsvangirai in court.

Last year, Mr Chagonda represented, Mr Patterson Timba on allegations of fraudulently attempting to take over a mining company.

Labels: MDC CORRUPTION, SOCIAL SECURITY, TENDAI BITI

posted by MrK @ 5:14 PM