This week I received two pieces of correspondence both causing upset. One evoking sadness and the other serious anger. Both are maladies brought about by the illegal land and farm assets confiscation in Zimbabwe in the early 2000s. The first one is easier to deal with as it is emotional, while the second one although also emotional will also affect any compensation claims and especially the value placed on that compensation if and when it is ever paid. I do not have a solution to either of them although the first appears to be done in good faith explaining clearly the plans and action to be taken while the second appears to have an agenda which in my mind is promoted by a group within our own community, mainly to the benefit of the government. At best it is window dressing, at worst, devious and reprehensible.
The first one arrived in the form of an email from Mashonaland Turf Club asking me if I was happy to give my proxy to an old friend, John Smith, in supporting his efforts to save horse racing at Borrowdale Park. I am a lifelong Centennial Member and therefore I am allowed a say in the actions to be taken in regard to the Turf Club. A democratic way of doing things with everyone with the right to vote to be able to do so.
Borrowdale Park has been the home of premier horse racing in Zimbabwe since 1957 and the only track in that country since the closure of racing in Bulawayo many years ago. I have many happy memories of afternoons spent with friends at the races. For me, more of a social event than a gambling event, despite being a racehorse owner. I always had more trust in cards than the horses. On occasion, my neighbour, Des Bruk-Jackson, and I would sneak off on Saturday afternoons during winter, the quiet time on a tobacco farm, to an afternoon racing, stopping at Nyabira club on the way home for an ABF (Absolute Bloody Final). Of course, there is no such thing. On more than one occasion I had to assist Des from the car to the bar.
Borrowdale Park was one of those racetracks which catered for family outings with facilities for all, including a broad spectrum of catering establishments from high dining to the poisons of takeaway. The latter is more effective to stabilise the effects of copious volumes of wine or beer. Eventually, the late Buster Rutter convinced me to join a syndicate in the ownership of a horse which unfortunately won a couple of times, whetting my appetite for further participation. Over the years I was to have a reasonable number of wins, probably just exceeded the number of horses I had owned. Horse syndicates were generally made up of friends or like people as disputes could occur on the choice of trainer, the running and fate of horses can be bitter. In owning a racehorse you had to apply for your racing colours. That is the attaining of a unique racing shirt and cap worn by the jockey riding your horse in a race. This involved due diligence of character and your financial status. Soon after I became a Centennial Member of Mashonaland Turf Club the funds raised were used to upgrade the facilities at the track. This gave life membership to the Club and access to the Owners and Trainers Lounge stand, it overlooked both the pre-race viewing paddock and the finishing post. It also provided private parking some fifty metres from the Owners and Trainers Lounge.
This is all excess information, I am now running ahead of myself. The issue is now the club, which is in severe financial trouble. Many of the regulars at the racetrack were farmers, owners and or employees of companies that served farmers or bought their produce. With the land confiscation and a general collapse of the economy, not only farmers but the service industries lost their source of income resulting in a mass exodus from the country leaving those remaining in a much reduced financial situation. That is, except for those that had gained political patronage by benefiting from some chef or senior government official. The club has survived the last twenty years by selling parcels of land mainly for office development with the track now embedded within what looks like an office park. I do not know the details, but I presume the free land is now exhausted and any further land sales will encroach on the track or at least interfere with the required area needed for race days. This has brought about the likely demise of racing, the end of an era on one of Africa’s finest racecourses and all the jobs that go with it, not least a fine day out. Funnily enough, on special days the masses would enjoy a day at the races with promotions offering huge prizes at draws held during the event. As many as 80,000 have attended the OK Grand Challenge Cup, a race one of the horses I was involved in once won unfortunately in my absence.
For me, sad to hear it has gotten to this stage and sorry that I cannot see any solution in saving the track. The economics of the country are the main cause, who can afford a racehorse let alone train one if the winnings are pennies? I am therefore happy to give my proxy to John, a successful businessman to make that effort. Good luck to him.
The second email was informing me that the promoters of the Global Compensation Deed (GCD), the Compensation Steering Committee (CSC), with an offer by the government wanting us to agree to change the original agreement from a cash offer to be paid over five years to one with poorer terms with payment in kind by means of ten-year government bonds. This was still to be under the now-defunct GCD included as an addendum. I do not think CSC has any formal constituency or mandate to continue representing us after their initial failure. Lack of transparency excludes us from the closed-door negotiations or offer documents. The original agreement was if the money could be raised it would be paid, this was the carrot in obtaining our mandate. If the money was not raised, the agreement fell away. What was there to lose? Most of us were sceptical from the onset. Of course, it was proven that it couldn't be raised. Zimbabwe is a failed country run by a corrupt regime with no credibility in the world. Certainly, no ability to raise money to pay off the very farmers they disenfranchised. Something we farmers knew but perhaps in desperation were willing to give the GCD the benefit of doubt.
It was certainly not a mandate to come to any alternate agreement and certainly the one being promoted now with even less chance of happening even with terms very much poorer than on offer from their initial approach. My blood is boiling that the Commercial Farmers Union (CFU) and Valcon do not feel they should protect the rights of their present, let alone past members. At the very least they should be providing international legal opinion on the offer and all the detail of the agreement content.
This offer is only for fixed assets hugely discounted in acceptance of the original offer which they are constitutionally obliged to pay in full. That is, if they care to obey their own laws. No compensation offered for your moveables be it a tractor or cow. This compensation is not for the land taken illegally from us, only improvements, leaving the ranchers in the south of the country little recompense if ever they get paid. By accepting the bonds, you will be required to cede your title, they say into some unknown as yet escrow account until the bonds are redeemed. Certainly not as safe a place as under your bed. The CSC, are now asking us to mandate them again, by what seems like a show of hands, to let them go into an agreement that does not compensate us in monetary form, but rather in ten-year government Bonds. Once an agreement is made it will go to a referendum where if it is rejected no doubt the government will blame the farmers of poor faith. A piece of worthless paper attracting only, one 1% coupon with the payments loaded at the far end. Personally, I think the present government has no intention of redeeming these bonds. Do you think thieves pay back their victims voluntarily?
No saying where the money will be found other than selling some unknown mining shares and assets. We are desperate but surely in our desperation, we are not so gullible to hand this group a mandate such as this? Especially as it seems to work in secrecy just as the SNP in Scotland which is falling apart for just this.
“Organisations that avoid transparency should be avoided at all costs.” - Peter McSporran
The offer has raised much commentary within the ex-farming community, with the formation of an informal group known as the Compensation Awareness Group. They are advocating a more formal legal approach rather than accepting a false promise supported by worthless paper and questionable agreements. It would appear most lawyers agree that the original GCD was a legally flawed document that would not have stood up in court if there was default by the government. After all, it is drafted for the government's benefit, not ours.
Zambia, a country with a stable economy and democratically elected government is offering 30% coupons on 10-year bonds. Zambian inflation is under 10%, Zimbabwe’s is over 200%, yet we are being offered 1%. They say it is in US$, but they will be locally issued bonds requiring local currency to purchase. Within the first four years, a very nominal sum is being offered, probably less than 4% of the value of the improvements on the properties. This will be paid on the submission of your title from year four. Funnily enough, this is the very title the government had previously said it had cancelled and yet now they are saying these documents have some value. If you submit your land title for the bonds they say they are only going to pay for the improvements. Why do they take the title they are not paying for?
“Only the foolish offer their house for collateral when they are buying a car.” - Peter McSporran
No Act of Parliament passed to say the value will be honoured or under the constitution what is on offer is legal. Most times because of chronic debt the government just rolls its bonds. Is there any reason these will not be treated the same?
“Financing of the budget deficit has been primarily through issuance of treasury bills by the Reserve Bank on behalf of Government. However, lack of capacity to service domestic debt has also seen roll-overs, which are posing some financial risks on domestic debt instrument holders and domestic financial institutions. This situation, unfortunately, is not tenable and is undermining the stability of the financial sector and overall economy.” - Patrick Chinamasa the previous Minister of Finance
Do they think we are desperate enough to swap our title deeds for worthless pieces of paper? My anger is not so much at the government but at the members of the CSC, all farmers and the CFU for promoting this mandate which can only be both a false promise and detrimental to any logical negotiations. Many of us are elderly now, in fact, many have already passed, but in my mind to be coerced into taking this paper in exchange for our titles by some of our peers is nothing short of promoting fraud to obtain our titles. If we fail to receive any payment when the bonds mature, they will not be holding up their hands and taking responsibility. It will not help us either to say we told you so. Further, members of this group, the signature to the latest cover letter including an ex-CFU President, have still got their land. Perhaps through patronage government is now calling on their capture for repayment of past or present favours.
“If the government swop our title deeds for bonds and fails to redeem the bonds it will still claim the land issue has been resolved albeit parting with little or no cash.” - Peter McSporran
The actual agreement is exceedingly simplistic and generated on the back of what was sold to the farmers presented as a cash payment for the discounted improvements despite the government and its agents having no chance of raising or for that matter ever would have considered paying. Especially if they got their sticky fingers on it. On the back of that, it appears the CSC has claimed to have a mandate to continue representing us and is now wanting to hold a referendum to sign the agreement on our behalf. What jurisdiction will recognise this? Perhaps Zimbabwe, certainly not international law. Interestingly enough, the letter to the government raising some of the issues of concern were all immediately simply agreed upon without negotiation indicating the piece of paper in their eyes is not going to be honoured. Many of these conditions would require parliamentary approval and a much stronger binding agreement with guarantees of what should take place when the state defaults which it surely will. What constitutional body is the referendum being held under and what does it represent? So many questions and so few sensible answers. I do not particularly like Trump but:
“The worst thing you can possibly do in a deal is seem desperate to make it. That makes the other guy smell blood, and then you’re dead.” - Donald Trump in the Art of the Deal
Disclaimer: Copyright Peter McSporran. The content in this blog represents my personal views and does not reflect corporate entities.
Comments