US embassy cable - 04HARARE73

C O N F I D E N T I A L SECTION 01 OF 02 HARARE 000073 
 
SIPDIS 
 
AF/S FOR S. DELISI, L. AROIAN, M. RAYNOR 
NSC FOR SENIOR AFRICA DIRECTOR J. FRAZER, D. TEITELBAUM 
LONDON FOR C. GURNEY 
PARIS FOR C. NEARY 
NAIROBI FOR T. PFLAUMER 
 
E.O. 12958: DECL: 01/12/2009 
TAGS: PGOV, PHUM, ECON, EFIN, ZI, ZANU-PF 
SUBJECT: RULING PARTY TURNS ON ONE OF ITS OWN 
 
REF: 03 HARARE 2364 
 
Classified By: Political Officer Win Dayton under Section 1.5(b)(d) 
 
1.  (C) SUMMARY: Flamboyant ZANU-PF MP and prominent 
businessman Philip Chiyangwa was arrested January 10 on 
charges relating to a GOZ investigation of troubled ENG 
Capital Asset Management (ENG).  His arrest manifests 
divisions within the ruling party that probably are based on 
business considerations and personal rivalries, not political 
views.  Chiyangwa's difficulties may foreshadow additional 
intramural combat stemming from failing economic fortunes of 
selected principals and machinations among ambitious or 
insecure ZANU-PF politicians.  END SUMMARY. 
 
2.  (C) Chiyangwa, the ZANU-PF MP for Chinhoyi, has remained 
in jail since his arrest, emerging only for court hearings 
over the weekend and again January 12.  The High Court ruled 
over the weekend that police had no grounds to hold Chiyangwa 
but police refused to release him.  According to the 
government-controlled Herald newspaper, police claimed that 
the High Court order was technically invalid because it had 
been addressed to the wrong official.  Late January 12 a 
magistrate's court heard defense counsel's petition to have 
charges dismissed.  The magistrate reserved judgment and 
remanded Chiyangwa into police custody.  The magistrate is 
expected to decide this week whether Chiynagwa has a case to 
answer and, if so, to consider application for bail.  An 
attorney with the law firm representing Chiyangwa told the 
embassy that police had been unavailable to discuss the 
matter with counsel and would not predict when Chiyangwa 
might be released. 
 
3.  (U) Chiyangwa reportedly faces charges of obstructing 
justice, perjury, and contempt of court.  The first two 
charges relate to his alleged lack of cooperation with 
authorities in their investigation of ENG during the last two 
weeks.  Two ENG principals reportedly had enlisted 
Chiyangwa's support in protecting them from creditors and in 
getting a criminal fraud investigation against them scotched 
(Chairman of the Parliamentary Budget, Finance, and Economic 
Planning Committee David Chapfika reportedly also was 
involved in "facilitating" matters for ENG).  Chiyangwa 
allegedly had sheltered some of the ENG principals' cars from 
creditors and obstructed police efforts to recover them.  The 
second charge stemmed from Chiyangwa asserting in open court 
last week during proceedings on ENG that he "would deal with" 
police connected to the case.  He refused the sitting 
magistrate's instruction to retract the statement. 
 
4.  (U) Media reports during recent months indicated that 
many components of Chiyangwa's diversified business empire 
were overleveraged or being sold at distressed prices.  The 
government-oriented Mirror on January 11 further reported 
that Chiyangwa was attempting to extort ZD400 million (USD 
60,000) from FSI Agricom Holdings through an illegal lease 
arrangement relating to a farm he had seized -- allegedly 
outside the terms of the GOZ land reform program.  The 
article added that Chiyangwa had sent thugs from the 
so-called Chinhoyi-based "Top Six" gang to suppress violently 
FSI's efforts to remove its equipment from the property. 
 
5.  (C) Curiously, the law firm retained by the ruling party 
stalwart is known best for  election petitions and other 
actions aligned with the opposition.  One lawyer from the 
firm noted that the actions supporting the charges against 
Chiyangwa -- sheltering the cars and then threatening the 
police -- would normally have required arrest on the spot or 
no arrest at all.  Indeed, the magistrate who heard the 
threat to police took no action when Chiyangwa refused his 
instruction to retract it.  It was only later that he was 
arrested, which the lawyer suggested indicated the 
intervention of high-level officials. 
 
6.  (C) In his diatribe against party members who put 
personal interests ahead of the party, President Mugabe 
singled out Chiyangwa (and only Chiyangwa by name) for 
warning during December's national ruling party conference. 
Vice-President Joseph Msika was one who had it in for 
Chiyangwa; his January 9 warning to unnamed politicians who 
abused their position and threatened law enforcement 
authorities was widely reported by national media as a stern 
warning to Chiyangwa.  Perhaps reflecting more than 
coincidence, Msika's remarks were made at the opening of a 
grocery store owned by ZANU-PF Central Committee member James 
Makamba, who reputedly fought Chiyangwa over a farm seized 
under land reform.  A close relative of Msika confided to 
DATT that Msika indeed had played a role in driving 
proceedings and had waited to take action against Chiyangwa, 
a distant Mugabe relation, until Mugabe was out of the 
country and Msika himself would be acting president.  A 
second source who knows Msika well told us (on what basis we 
do not know) that Msika informed Mugabe in advance of his 
intention to act against Chiyangwa. 
 
7.  (C) COMMENT: A cocky favorite with the local media, 
Chiyangwa is one of the most prominent of a new breed of 
ZANU-PF young turks who have translated their position into 
phenomenal business success by hook or by crook.  The 44-year 
old is a rough cut: during the run-up to the 2002 elections, 
he took out ads promising money to supporters and appeared in 
video clips encouraging violence against white farmers and 
MDC supporters.  More recently, his notorious "Top Six" gang 
has been implicated in violently preventing MDC political 
candidates from filing nomination papers, as well as in the 
violent seizure of farm properties.  A high profile black 
empowerment advocate, Chiyangwa is a lightning rod who 
provokes strong reactions among Zimbabweans; dozens of his 
supporters (including other politicians) chanted 
revolutionary songs (and, curiously, anti-opposition slogans) 
in his support at the courtroom during his hearing January 10. 
 
8.  (C) COMMENT (CONT'D): Notwithstanding his national 
prominence and appeal to many, Chiyangwa clearly lost favor 
with those who matter.  His alleged improprieties generally 
conformed to popular practice in Zimbabwe; that they did not 
enjoy customary impunity substantiates the political nature 
of his prosecution.  Although the youthful Chiyangwa's 
political career may not be over for good, the rising star's 
rather sudden eclipse offers some lessons.  First, it 
underscores the precariousness of power among those who 
jockey for position below the ruling party's pinnacle.  We do 
not know fully what led to Chiyangwa's apparent demise; 
however, the braggadocio and colorful disdain for authority 
that contributed to his fast rise to prominence appears also 
to have been instrumental in his fall.  In a party with but 
one leader and voice, individualism and ambition often 
provoke suspicion, jealousy and a concerted drawing of 
daggers among rivals who view power as a zero sum game.  His 
plight, prominently chronicled in humiliating detail by the 
government media, is a warning to other party mavericks and 
rising stars.  The turning of the state media, always under 
the control of Information Minister Jonathan Moyo, against 
Chiyangwa is itself an object lesson on the fickleness of 
cronyism. 
 
9.  (C) COMMENT (CONT'D): The decline of Chiyangwa's business 
empire certainly reduced his value to the party and to those 
in the party who might have protected him.  In that vein, 
there are other party business moguls who, like Chiyangwa, 
are finding themselves dangerously overextended -- and 
increasingly expendable -- as the economy continues its 
downward spiral.  Those who, like Chiyangwa, have built 
economic and political success at the expense of rule of law 
may increasingly find themselves hoisted on their own petard 
should Zimbabwe continue on its current course.  The 
situation appears ripe for additional intrigue and 
bloodletting within the ruling party but, with depth of 
personal loyalty to Mugabe being the principal credential for 
career security and advancement, little of this augurs well 
for a healthier policy-making environment. 
 
SULLIVAN