US embassy cable - 05PRETORIA3543

C O N F I D E N T I A L PRETORIA 003543 
 
SIPDIS 
 
DEPT FOR AF/S B. NEULING AND M. TABLER-STONE, EB/IFD, EB/OMA 
LONDON, PARIS, BRUSSELS FOR AFRICA WATCHERS 
 
E.O. 12958: DECL: 08/30/2015 
TAGS: PREL, PHUM, ECON, KDEM, ZI, SF 
SUBJECT: SOUTH AFRICA DENIES PAYING ZIMBABWE'S IMF BILL; 
GONO SAYS GOZ PAID DEBT ITSELF 
 
REF: A. 8/30 NEULING-RIPLEY EMAILS 
 
     B. PRETORIA 3141 AND PREVIOUS 
 
Classified By: Charge d'Affaires, a.i. Don Teitelbaum 
Reasons 1.4(b) and (d) 
 
1. (C) Per reftel A, the IMF reported to the USG August 29 
that Zimbabwe paid $120 million toward its IMF debt.  South 
African Department of the Treasury officials that Post 
contacted August 30-31 were unaware of any South Africa 
payments on behalf of Zimbabwe to the IMF.  Zimbabwean 
Central Bank Governor Gideon Gono told Strive Masiyiwa (see 
bio-note below) August 31 that the Government of Zimbabwe 
(GOZ) paid the loan itself without outside assistance.  In an 
August 31 telcon with PolOff, Masiyiwa said that Gono told 
him he had "starved" the nation of fuel and other key items 
to accumulate the hard currency.  IMF staff were not aware of 
the GOZ reserves because they were accumulated only since 
June 30.  Gono said that South Africa was not aware of the 
payment; only President Mugabe, Gono, and two Central Bank 
advisors knew of the plan.  Even Finance Minister Murerwa was 
not aware until late August 29.  Gono told Masiyiwa that the 
GOZ made the payment as a "matter of national sovereignty." 
Masiyiwa said that Gono was excited and very upbeat about the 
news. 
 
2. (C) Comment:  The payment of a chunk of Zimbabwe's IMF 
debt seems to take the wind out of the sails of the South 
African-Zimbabwe loan negotiations (reftel B).  While the GOZ 
still owes some $170 million to the IMF and desperately needs 
food, agricultural inputs, fuel, and electricity, the IMF 
payment (and resulting diminishing of expulsion threat) 
removes a key SAG leverage point.  South Africa may still 
make a loan/grant, but may have to abandon its political 
conditions.  Gono's story (through Masiyiwa) that the GOZ 
paid its own IMF debt is possible, but it also is possible 
that other, unspecified parties made contributions that both 
they and Zimbabwe want to keep secret.  End Comment. 
 
3. (C) Bio-Note:  Strive Masiyiwa is a Zimbabwean businessman 
and Chief Executive Officer of Econet Wireless, an 
international telecommunications company.  He lives in South 
Africa in political exile.  While a fierce opponent of the 
Mugabe regime and MDC supporter, Masiyiwa remains in contact 
with some GOZ officials, including Gono, who was once a 
member of his corporate board.  End Bio-Note. 
TEITELBAUM