US embassy cable - 03HARARE310

C O N F I D E N T I A L SECTION 01 OF 02 HARARE 000310 
 
SIPDIS 
 
NSC FOR SENIOR AFRICA DIRECTOR J. FRAZER 
LONDON FOR C. GURNEY 
PARIS FOR C. NEARY 
NAIROBI FOR T. PFLAUMER 
 
E.O. 12958: DECL: 02/09/2008 
TAGS: ECON, ELAB, PGOV, ZI 
SUBJECT: PROPOSED WAGE FREEZE - ZCTU'S POSITION 
 
 
Classified By: Laboff KRBel for reasons 1.5 (b) and (d). 
 
1. (C)  Summary.  The Zimbabwe Congress of Trade Unions 
(ZCTU) continues to negotiate with employers and the GOZ in 
an attempt to find common ground for economic actions which 
will ease the burden on the ordinary worker.  Despite 
widespread agreement between the working-level contacts on 
the best way forward, the ultimate proposal stripped many 
areas of consensus and focused only on wage freezes and price 
controls.  The ZCTU believes that its mandate is to advocate 
-- with whomever is in power -- for the betterment of its 
membership, rather than engage in politics or attempts at 
government-building.  Chibebe has yet to be convinced that 
calling on the ZCTU's membership to be the "shock troops" for 
a mass action will guarantee any benefits to the average 
worker.  Until the positions of the military and police 
forces are clearly stated, the ZCTU remains wary of direct 
confrontation.  End summary. 
 
2. (C)  Laboff met with Wellington Chibebe, Secretary General 
of the Zimbabwe Congress of Trade Unions, for a discussion of 
the current Tripartite Negotiating Forum (TNF) process. 
Labor has been meeting with representatives of both business 
and government in an effort to come to some agreement on a 
prudent plan for short-term economic management.  However, 
while technical experts from all sectors agree on the 
practical steps necessary to stimulate the economy, the 
ultimate proposal -- dubbed the TNF protocol -- focuses only 
on a narrow range of actions. 
 
3. (C)  According to Chibebe, the TNF negotiators agreed on a 
broad range of steps viewed as necessary to prod the economy 
from stagnation.  These included the wage freezes addressed 
in the TNF protocol, and also encompassed addressing issues 
of governance, stabilizing the fuel supply, devaluing the Zim 
dollar, and tying controlled prices to the prices of inputs, 
including labor costs.  Despite widespread agreement in the 
negotiating team, only the wage freezes and local product 
price controls made it into the final proposal.  Chibebe 
believes that, even if the GOZ is negotiating in good faith, 
the level of actual control it is able to exert on the 
economy is likely to be limited.  Nevertheless, he believes 
it is incumbent upon them to continue with the negotiations 
-- for the present. 
 
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Wage Negotiations Likely to Threaten Accord 
------------------------------------------- 
 
4. (C)  While the ZCTU is willing to engage in dialogue, even 
though it does not believe the current regime to be 
legitimate, Chibebe fears that the talks may reach a sticking 
point on actual minimum wages.  Chibebe believes that the GOZ 
does not recognize the critical situation faced by most 
workers.  For instance, the minimum wage for agricultural 
workers is only Zim $4,500 per month (US $3.21) while Chibebe 
believes the poverty datum line is closer to Zim $20,000 (US 
$14.28).  Similarly, an industrial worker's minimum wage 
stands at Zim $13,000 per month (US $9.28), but Chibebe 
believes that poverty level for such a worker lies between 
$36,000 and $42,000 per month (US $25.71 - $30.00).  The 
variance between these two representative ranges is the 
result of differences between rural and urban living costs. 
The cost of food, traditionally lower in the rural areas and 
closer to the source of production, is now astronomical both 
in urban and rural areas due to shortages and widespread 
dependence on the costly black market.  However, some 
agricultural workers still benefit through subsidized 
housing, subsidized food, and lower transport costs. 
 
5. (C)  The difficulties inherent in negotiating new minimum 
wages are typified by the experience of GAPWUZ, the 
agricultural workers' union.  Last September, the 
Agricultural Labor Board (ALB) of the Commercial Farmers' 
Union (CFU) negotiated new minimum wages with GAPWUZ.  At 
that time, both parties agreed to increase the minimum wage 
from $4,500 to $7,500, with future increases to $9,500 in 
January 2003 and again to $11,500 in May 2003, and submitted 
their collective bargaining agreement to the Minister of 
Labor for "registration," or approval.  Minister of Labor 
July Moyo -- who himself is the recipient of a new farm, 
along with his deputy and other interested decision makers -- 
rejected the agreement in December 2002, demanding that the 
ALB and GAPWUZ renegotiate the agreement for a lower minimum 
wage.  The reason?  Minister Moyo claimed that the negotiated 
wage was too high for the newly-resettled farmers -- 
including himself -- to absorb, and constituted "sabotage" 
against the land resettlement program.  The irony, of course, 
is that anybody unable to meet a statutory minimum wage is 
entitled to request a waiver under the Labor Relations Act -- 
but this would then open the door for a review of the 
appellant's financial status.  Although the ALB has obtained 
two legal opinions that hold the Minister of Labor does not 
have the authority to demand that the two parties 
re-negotiate a lower minimum wage, the Minister has refused 
to recognize the collective bargaining agreement. 
 
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Comment:  Dialogue vs. Mass Action -- And the Aftermath 
--------------------------------------------- ---------- 
 
6. (C)  According to Chibebe, the failure of the ZCTU to 
support recent calls for mass action or widespread stayaways 
is the result of careful evaluation rather than lack of 
political will.  The National Constitutional Assembly (NCA), 
which has called for the past few failed stayaways, is quick 
to cast ZCTU as a sellout for engaging in dialogue with a 
discredited government.  However, as Chibebe points out, 
dialogue -- forcing the government to meet with its 
adversaries -- is the traditional goal of mass action.  If 
the main benefit to be gained from mass action is 
negotiation, why not engage in negotiation without the added 
burden of requiring members to expose themselves, both 
personally and financially, through strikes and stayaways? 
Besides, he added, the GOZ has committed itself to enough 
unachievable goals -- including reducing the deficit to 
eleven percent, and reducing inflation to 95 percent by the 
end of June -- that if it reneges on substantive matters such 
as reasonable minimum wages, the ZCTU has adequate grounds to 
call for mass action if and when the current dialogue has 
clearly failed. 
 
7. (C)  Another reason that the ZCTU has been unwilling to 
wholeheartedly support calls for mass action is that there 
have been no clear statements of who would fill any resultant 
power vacuum, and where the security forces will throw their 
weight.  If a mass action called by the NCA and supported by 
the ZCTU proved so successful that the existing power 
structures crumble, Chibebe's concerns would continue to 
focus on the situation of the workers.  Despite its close 
relationship with the MDC, the ZCTU is not convinced that the 
opposition party is prepared to manage the economy for the 
benefit of the labor force should the Zanu-PF hierarchy 
implode.  Chibebe is also wary of the role of the military as 
well as the police forces in a post-Zanu-PF government. 
According to his talks with the MDC leadership, there has 
been no indication of what role these powerful players would 
take in a confrontation with Zanu-PF or in a post-Zanu-PF 
government.  Chibebe hopefully described a potential 
situation wherein only "the first five or ten protesters 
would be shot, and the security forces would then refuse to 
be the enforcers and would come over to the side of the 
protesters..."  However, without any assurance that the 
security forces are actually aligned with the goals of the 
MDC, NCA and ZCTU, Chibebe remains completely unwilling to 
put his membership at the forefront of a potentially fatal 
conflict. 
 
8. (C)  As the tripartite negotiations demonstrate, the ZCTU 
still thinks that it can best work from within the system, 
and Chibebe believes firmly in dialogue at this stage.  If 
the dialogue nets no solid gains at the end of the period of 
the negotiated wage freeze -- currently scheduled through 
June -- mass action may again become the most appropriate 
response.  End comment. 
SULLIVAN