Cancel Chinese US$98m loan or turn it into a grant

OPINION: What is left now is for the Parliament of Zimbabwe to cancel the Chinese US$98m loan or turn it into a grant. There are overwhelming reasons for taking such a drastic move in the national interest but we will focus on 5 key reasons.

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Firstly, it is standard practice in contracts to reverse a loan deal which you feel does not meet your expectations. It is normal for any loan agreement to have a 28 or 30 day cancellation or ‘cooling-off’ period. It would be unusual if the Chinese loan was an exception.

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Although some loan agreements have cancellation clauses which provide for a penalty fee, in this case, it would be worthwhile to pay any reasonable penalty fee and opt out of such an unbearable national burden in good time than to recklessly mortgage our children’s future.

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Should the Chinese refuse to cancel the US$98 million loan deal, they can be told in no uncertain terms will Zimbabwe ever seek a loan from them again as long as they refuse to cancel it or turn it into a 100% grant with no strings attached e.g. use of Chinese labour and materials at the expense of Zimbabwe’s own unemployed population and abundant materials. One recalls the case of the National Sports Stadium which was built by the Chinese allegedly using sand imported from their country.

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Secondly, the public outrage that the loan deal has provoked is enough to forewarn the MPs about the trouble that lies ahead if they don’t sort out their blunder before the elections. Among those who have spoken out against the loan are civil society e.g. Zimbabwe Coalition on Debt and Development (ZIMCODD), Mavambo/Kusile/Dawn (MKD), the press editorials and ironically, the Minister of Finance Tendai Biti called the loan “criminal” (Voanews.com, 15/06/11).

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Thirdly, it is not needed now especially for constructing a spy centre which could potentially be used against the very people whom the spies purport to be protecting especially ahead of the referendum and general elections when State security agents suddenly turn into Zanu-pf activists 24/7.

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Fourthly, we cannot afford it because we are already over-borrowed at over US$7 billion.

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Fifthly, it is unfair by being tied to our diamonds for 20 years and depriving our children and grandchildren of any breathing space from the toxic loans some of which were amassed by the pre-GPA regime under mysterious circumstances.

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Civil society should keep pressure on the government for a full audit of Zimbabwe’s US$8billion debt to determine how much was borrowed when, by whom, from whom, for what and how was it spent? Similarly, a full forensic audit is needed on the diamond sales, again to establish the quantity sold, the dates, the value, the buyer, the seller and what happened to the proceeds. These audits are very important in holding those in public office accountable and to prevent corruption and money laundering.

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©Clifford Chitupa Mashiri, Political Analyst, London, zimanalysis2009@gmail.com