Corruption watch WITH TAWANDA MAJONI
A decent-sounding but obviously crude word is trending in Zimbabwe: Cartelism. That means using similar crookedness by selfish individuals, social classes or groups and institutions to fleece an already sorry population without caring too far about it.
It’s a phenomenon that can’t be difficult to understand because we have been living it for some time now. Real time. Since government’s weird decision to introduce an equally weird currency called bond notes in late 2016, we have been having acute shortages of good money — particularly US dollar. But “shortages” is also an awkward word to use. Because, you see, that good money has all along been available everywhere but in the banks.
Why and how? Start off with your dictionary and look for the word “cartelism”. Zimbabwe’s elites have been using Zimbabwe’s not-so-elites to trade the foreign currency on the black market. And the elites have been doing that with incredible success because they have access to other elites in the banking sector who, in turn, have access to the bad money — the bond notes — which makes it possible to trade in good money. That’s a practical description of “cartelism”. A currency cartelism.
This currency cartelism is, by far, the crudest and biggest form of cartelism that we have had to endure in close to three years. Most of all the other forms of cartelism emerge from there and are, at a closer look, refined versions of this one. Just recently, the minister of Finance, Mthuli Ncube, and that of Industry and Commerce, Mangaliso Ndlovu, told us that our biggest problem was the existence of cartels. As if we didn’t know that all along.
These cartels exist in the transport, food, financial, service, fuel and other you-name-it sub-sectors of the economy. The barons stash away basic commodities to force price increases. They virtually create monopolies and fix prices. They send their runners to scoop up the foreign currency and the bad bonds alike and fix the rates under dim candle light. And once they fix the rates, everything bad follows.
But no one can touch these cartelists because they are untouchable. They are the guys who rule you every day. They hold power. They don’t care about you because their constituencies are their pockets. Everyday, they holler into the void about the need to nip the cartelists but, unless you are a pathological optimist, you can’t believe them. How can the cartelist nip himself? It’s socially, politically, biologically and psychologically impossible.
The problem with these elite cartelists is that they generate many other problems for the people and themselves alike. That’s what they have done in the property industry. Knowingly and also without the intention, they have created a monster in the form of landlords. Most of those elites, of course, are landlords, so they couldn’t worry a whisper about the new form of cartelism, which is the rent cartelism.
First, the elites chased away the good money from the formal market by insisting on the bond note, which, confusingly, they want to replace with another worthless piece of paper come Christmas time. They did that so that they could create the currency cartelism, of course. Pity that they kicked out the foot soldier, Patrick Chinamasa, once he did the job for them and the last we heard about him, he was sniffing around rubbish bins somewhere.
And once they chased away the good money, they created a huge appetite for good money. Because the bad money is what it is, bad. Now, landlords everywhere are saying it’s bull to be getting payment for their properties in bad bond money, so they must be getting their dues in US dollars. As the landlords and property developers are at it, they are engaging in all sorts of crooked things to make hay while the sun shines.
Take this sad case. A citizen entered into an agreement with a property developer to subscribe towards a residential stand in 2011. Along the way, things got so bad for the home-seeker and she started defaulting on monthly payments. Then, suddenly, the developer sent his secretary who he pays using the bad money to tell the home-seeker to report at their offices for talks. The next thing, the home-seeker was getting a form shoved into her face to sign, otherwise her matter would be taken to the High Court for closure and she would get nothing.
Well, she was defaulting, so that couldn’t be the developer’s problem. After all, their contract was clear on defaults. The developer could withdraw the residential plot on default. But to look and sound humane, the developer said they were prepared to reimburse whatever she had paid between 2011 and 2018. The moral of this anecdote starts there. The secretary made quick calculations — which were never given to the other party for confirmation — and told her that she would “tomorrow” get her reimbursement through her bank. The currency? Bond RTGS.
Now, you will recall that Zimbabwe was using the US dollar and a basket of other foreign currencies between February 2009 and late 2016. After that, it was those currencies and the bond note, which was, officially, at par with the US dollar until early this year. After that, the bond weakened like a diseased zygote. That means the developer was supposed to remember that and reimburse the hapless lady accordingly.
Not only did it take time for the developer to transfer the repayment into her account using the RTGS mode and, as has been happening of late, but the bank took time to action the transfer. She clearly lost out on the good money that she had paid the developer in monthly instalments towards the residential stand considering the rate at which inflation is cruising. That says the developer took unfair advantage of the home-seeker. To make matters worse, this developer which, to clear any possible queries, is called Damofalls — is demanding that home-seekers make their monthly subscriptions in US dollars despite making re-imbursements in our very bad money.
The story of this sad home-seeker is not like the fable of the single stork that made a summer. There are thousands of people out there is her situation and they are being robbed by property developers like Damofalls in broad daylight and at night alike.
But that’s not all about these rent and property cartelists who have seen a million opportunities to fleece people. Take a different but similar case. Jojo signed an office lease agreement with a landlord four years ago, He paid a good tenancy deposit of US$600 but, since the introduction of the bond, he has been paying in bad money. Now, the landlord had trebled the rental and wants it in foreign currency. Jojo wants out and wants his deposit too. The landlord is saying he will only pay the equivalent in RTGS! Again, Jojo is not that single stork that made a summer. There are so many people who are suffering the same predicament.
As we speak, the resort town of Victoria Falls is facing extinction, so to speak. This is because residents are fleeing the town to live in rural areas after landlords connived to demand rentals in US dollars without the local dollar option. The mass flight of residents is understandable. Most Zimbabweans — if they are lucky to be still employed — are getting their salaries in RTGS, not US dollars. And they are not getting too many RTGS dollars.
By insisting on payment in foreign currency, the landlords are telling us one thing, loudly. They are saying they are cool with criminality. The only place you can get US dollars if you are not paid in US dollars is the black market.
Tawanda Majoni is the national coordinator at Information for Development Trust and can be contacted on firstname.lastname@example.org