US sanctions should be taken seriously

By Ken Mufuka

I WAS visiting Washington, DC, the United States capital. Like many Zimbabweans, I had never heard of a small but important office in the US treasury department called office of foreign assets control.

This division of the US treasury is the one responsible for sanctions enforcement. Like most Zimbabweans also, I was surprised to learn that it is not a toothless bull-dog.

It is full of poisonous fangs. It issues enforcement guidelines, and apparently acts in the capacity of prosecutor and judge all at once.

The issue, according to Brother Nathaniel Manheru, who works in the President’s Office in Zimbabwe will undergo further sanctions if it goes ahead with the Russian-sponsored Darwendale Platinum Project. This US$3 billion project will employ 8 000 Zimbabweans when it is fully operational. That definitely is a big deal. At the moment, platinum is selling about gold at US$1 200 per troy ounce.

That also is a big deal. If the project were to succeed, Zimbabwe might become the second largest producer of platinum after South Africa. That also is a big deal.

So, now you will say: “Ken, what seems to be the problem? The winds are in Zimbabwe’s favour.” Not quite. Though the US State Department and the US embassy in Zimbabwe have not verified Manheru’s statement, the concern he raises is credible and fits the US profile.

If the platinum deposits were to fall into the hands of non-US companies, such as Russian and Iranian companies, such an occurrence would strengthen the nuclear interests of those countries. Platinum is used in thermocouple elements, electrical contacts, coating of missile nose cones, jet engine fuel nozzles and other corrosion resistant apparatus.

The connection lies in the friendship with Iran and Russia. Iran is building a nuclear bomb, an occurrence which the US and ally Israel deems improper.

For this reason, Iran was placed under the US sanctions regime, causing its Rial (money) to lose half its value by 42 percent, and generating inflation. In brief Zimbabwe is being accused of supping with US enemies, Russia and Iran, and for that it must be punished.

The trade between Iran, Russia and Zimbabwe in platinum is covered under Restrictions (ii) which covers goods which have dual use, military or civilian. While trade between Zimbabwe and the US is no longer significant; in 2012 Zimbabwe exported US$60,5 million worth, while importing US$13,9, thus leaving us with a positive surplus.

In 2014 US imports have declined to US$32 million while our imports have gone up to US$20 million. Though these figures are not earth-shaking, with our economy in the doldrums, every little positive surplus helps us.

Americans are the biggest tourist spenders and they are known to give large tips to waiters and personnel assisting them in any way. Tourism is therefore Zimbabwe’s goose that lays golden eggs. However, no matter how hard we try, there are persistent perceptions shared by the US State Department which discourage American visitors to Zimbabwe.

The US State Department shares the following observations with Americans wishing to travel to Zimbabwe. The US Embassy also gives its own advice on a website on Zimbabwe. “The political, social, economic and security situation… is unpredictable and could deteriorate quickly without warning.” How is that for a start?

When travelling to Zimbabwe, “you should notify a trusted friend or family member of your itinerary, including expected departure and arrival times.” The reasons for this hyper sensitivity are listed below.

“Resident and visiting US citizens have been arrested, detained and threatened with expulsion for activities including humanitarian aid and expressions of opinion” deemed unfavourable to Zimbabwe.” Zimbabwean authorities also “run motorists off the road, beat and harass drivers who fail to pull out of the road” when presidential motorcades are passing.

Visitors can register at the US Embassy before travelling so that if need be, the embassy can come to their assistance. Worldwide travel agency advises that another “thing is to make sure your travel insurance cover rescue when political unrest or a revolution starts. It is just being a smart traveller.”

Building perceptions is part of the economic war against a country. Unfortunately, the perceptions described above are very much near the mark and are not exaggerations of a hostile country. Travel agencies do have problems with Zimbabwean bookings.

Perhaps not surprisingly, booking through South Africa agencies, using Visa and American Express Cards is as easy as eating cheese cake. The penalty, however, paid by Zimbabwean operators can be as high as 20 percent of their fees.

Some sanctions are self-imposed. Greg Duncan, a correspondent for several South African newspapers, reported on August 2, that “the fun and excitement of travelling through Zimbabwe was marred by fear in Zimbabwe.” Duncan says that there is a decidedly anti-white feeling among Zimbabwean authorities who handle foreign visitors.

A drunken highway patrol officer stopped him and demanded a minimum of US$100 or some jail time on Friday evening. Friday was auspicious in that the resident magistrate would be available on Monday to review his case. “I thought our experience with the bad cop may have been an isolated incident.

However, most people we spoke to in Zimbabwe had tales of police harassment on the roads.” Thus a combination of US sanctions and self-imposed sanctions are destined to reduce the numbers in our tourist trade.

You can reach Ken Mufuka on [email protected]. This opinion piece was initially published by the weekly Financial Gazette