US embassy cable - 02HARARE1863

C O N F I D E N T I A L HARARE 001863 
 
SIPDIS 
 
E.O. 12958: DECL: 08/14/2012 
TAGS: ECON, EMIN, PINR, ZI 
SUBJECT: BREDENKAMP CONSULTANT DISCUSSES HIS PROMINENT 
CLIENT'S BUSINESS DEAL (C-NA2-00908) 
 
Classified By: Laboff KRBel for reasons 1.5 (b) and (d). 
 
1. (C) On August 15, Laboff met with a local economist and 
John Hollaway (protect), a Zimbabwean mining consultant, to 
discuss potential economic lifelines available to the GOZ 
through development of platinum resources.  As expected, 
Hollaway believes that any sizable expansion of the platinum 
mines will depend heavily upon outside investment, which is 
not very likely given the dismal investment climate as well 
as the perennial rumors of nationalization/ indigenization of 
the Zimbabwean mining industry.  Hollaway has agreed to 
facilitate a visit to one of the platinum mines for Laboff 
and DCM in order to get a better feel for the situation on 
the ground. 
 
2. (C) Hollaway was returning from a trip to the Democratic 
Republic of Congo (DRC), where he has been working as a 
consultant for wealthy Zimbabwean businessman John 
Bredenkamp, who has long enjoyed a cozy relationship with the 
Mugabe government.  According to Hollaway, Bredenkamp is 
disenchanted with his investments in one of the world's 
richest cobalt deposits located in the DRC, where he has 
recently spent over US$24 million with no profit in sight. 
Hollaway noted that mining is a capital-intensive, long-term 
investment, which contrasts with many of Bredenkamp's other 
ventures in such businesses as oil, weapons, and land, which 
tend to produce more immediate profits.  In a business 
venture which Hollaway requested that Post keep confidential, 
he is currently investigating whether a failed Zimbabwean 
platinum refining unit can be retrofitted in order to refine 
cobalt mined from the DRC deposit. 
 
3. (C) Hollaway also mentioned that he had the opportunity to 
speak with some of the Zimbabwean soldiers while on 
assignment in the DRC.  In what he characterized as "about a 
dozen highly discreet conversations" with non-commissioned 
officers and lower level commissioned officers, Hollaway 
discerned more than a little discontent.  According to 
Hollaway, the soldiers expressed frustration at being used as 
pawns as well as a fairly widespread lack of interest in 
being Zanu-PF lackeys.  Although there is extensive talk of 
Zimbabwe looting the resources of the DRC, Hollaway reported 
that the soldiers felt that Zimbabwe was actually being 
looted instead.  Timber concessions granted to Zimbabwe have 
turned out to generate insignificant profits, while diamond 
mine concessions have benefited only a handful of the top 
military brass.  While some soldiers are obtaining Zimbabwean 
farms through the land resettlement program, apparently only 
the higher-level officers are beneficiaries.  In return, 
Zimbabwean soldiers have been involved in a long-running 
conflict in a far-off land while the news from home signals 
repressive social legislation, political unrest and domestic 
economic disaster.  Hollaway acknowledged that the return of 
discontented troops to a volatile domestic situation could be 
problematic.  In fact, he speculated that if soldier 
discontent were to ripen into some sort of action, that 
action will likely take the form of a junior-officer coup, 
perhaps with a "sprinkling of generals" just for legitimacy's 
sake. 
 
4. (C) Comment:  John Hollaway is a fairly significant mining 
consultant on the regional scene who was introduced to us by 
a well-respected economist.  Hollaway is a second generation 
white Zimbabwean who has experience in assessing deposits and 
mining gold in Zimbabwe, South Africa, and Tanzania, among 
other projects, and he is currently working as a consultant 
with Bredenkamp and other local clients in an attempt to 
increase the production of platinum from Zimbabwe.  He has no 
apparent axe to grind and, unlike some other white 
Zimbabweans, he does not seem to be indulging in fanciful 
scenarios wherein U.S. Marines ride in to the rescue.  He did 
not offer his observations as a method of spurring the 
Western powers to action, but simply as responses to 
questions about his recent work in the DRC.  In fact, he was 
on his way to address the Chamber of Commerce in Harare about 
the "window of opportunity" which existed in the DRC mining 
industry, at the request of a DRC contact interested in 
luring Zimbabwean technological investment in the DRC.  End 
comment. 
SULLIVAN