Links ~ 4 October 2008

Mbeki agrees to stay on as Zimbabwe mediator (Reuters)
Zimbabwe’s President Robert Mugabe was set to meet opposition leader Morgan Tsvangirai on Saturday to try to break a deadlock over cabinet posts threatening a crucial power-sharing deal, a senior government official said. Arthur Mutambara, leader of a smaller faction of the opposition Movement for Democratic Change (MDC), was also due to attend the meeting at Mugabe’s State House offices in Harare, he said. “The principals will be meeting today in an effort to resolve the outstanding issues,” a senior official close to the talks told Reuters.

Refugees still pouring into South Africa (The Zimbabwe Times)
Disgruntled Zimbabweans, still grappling with an economic meltdown that has continued unabated, continue to cross into neighbouring Botswana and South Africa in search of employment and better living conditions. An immigration official in South Africa reported this week that thousands of Zimbabweans were still crossing into the more prosperous neighbouring country. “We host thousands of Zimbabwean immigrants daily, both legally and illegally,” said the official. “There has been no change in their flow into this country and I doubt if a change will come any time soon,”. Human traffickers, popularly known as Omalayitsha (human carriers), have not stopped bringing illegal immigrants in, said the official.

Zimbabwe bans bank transfers (Financial Times)
Zimbabwe’s central bank on Friday outlawed one of the last functioning parts of the country’s ravaged financial system, hampering businesses already brought to the brink of collapse by rapidly worsening hyperinflation. Gideon Gono, governor of the Reserve Bank of Zimbabwe and a close ally of President Robert Mugabe, suspended electronic transfers between banks on the grounds that they were “being used for illicit foreign exchange deals” and to charge excessive prices for goods and services. “We have no option but to take this drastic measure in order to maintain sanity in the financial system,” Mr Gono was quoted as telling state radio.

Economic crisis worsens as Reserve Bank suspends RTGS (SWRA)
The announcement by Reserve Bank Governor Gideon Gono to suspend RTGS has plunged the country’s banking system into a fresh crisis, after a move to put more cash into circulation backfired this week. The introduction of higher denomination bank notes, as well as the increase in cash withdrawal limits on Monday, saw chaos on the streets as tens of thousands queued to withdraw much needed funds. The move also prompted rampant price hikes, made worse by the collapse of the Zimbabwean dollar on Wednesday. The currency crashed to more than half its value as a result of the political stalemate between the country’s rivals over the distribution of cabinet posts.

Suspension of RTGS Commendable (The Herald – state controlled media)
The sudden suspension of the RTGS, potentially allowing almost instant transfers between accounts at different banks, will not hurt legitimate business much so long as the banks do not try and take advantage of the change to milk their customers. The RTGS always had its problems and it never worked as well as it was advertised; at times it came close to disaster.

RTGS cash movers lick their wounds (The Chronicle - state controlled media)
MANY big cash movers were yesterday left licking their wounds following the Reserve Bank of Zimbabwe’s (RBZ) decision to suspend the RTGS payment system for almost all transactions. The Central Bank’s move is meant to stop currency speculation and over-pricing of goods. While the move will have no effect on many ordinary citizens, some dealers who were making millions of dollars without breaking any sweat were left in a quandary.

Zim youth march in Pretoria (iafrica)
About 100 members of the Revolutionary Youth Movement of Zimbabwe handed a petition to the presidency at the Union Buildings on Friday in protest against the political impasse in that country. The movement’s president Simon Mudekwa said the petition was handed over shortly after midday. “It was signed by various organisations even civil society over a two week timeframe,” he said. The protesters called for, among other things, the speeding up of the process to create a new democratic constitution and the equitable sharing of key ministries between the parties.

Air Zimbabwe grounded as pilots strike (ZimOnline)
Cash-strapped Air Zimbabwe was on Friday forced to ground all its planes after pilots went on strike demanding more pay to cushion themselves against the country’s runaway inflation, which at more than 11 million percent is the highest in the world. Sources at the national airline said the pilots were demanding new and higher salaries paid in foreign currency, shunning the near worthless Zimbabwe dollar which continues to shed its value faster than any other currency on earth.

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