Barclays provides loans to Mugabe’s Ministers

By Tererai Karimakwenda
12 November, 2007

Controversy has brewed once again for the British Barclays Bank over its alleged bankrolling of the Mugabe regime. This time the bank is accused of providing loans to Robert Mugabe’s land owning Ministers, to ‘improve productivity in agriculture,’ despite the fact that the farms were taken illegally and violently. The revelations come only months after it was revealed that a Barclays subsidiary was funding fuel supplies for the Zimbabwean government, including jet fuel for military planes, which is under a trade ban.

According to a report in The Sunday Times UK, Barclays has lent £750 million to at least 5 ministers in the first half of this year alone. The beneficiaries include the national security minister who is also in charge of Land Reform, Didymus Mutasa, Information and publicity minister Sikhanyiso Ndlovu, Justice Minister Patrick Chinamasa, Agricultural Minister Rugare Gumbo and Webster Shamu, Minister for policy implementation.

At issue is the question of ethics and corporate responsibility. Barclays is providing funds to Ministers who took farms illegally under the violent and chaotic land reform programme, which displaced hundreds of thousands of farm workers, thousands of commercial white farmers and led to the destruction of agriculture in Zimbabwe. Now these same ministers are gaining even more personal wealth under the guise of agricultural improvement, while their oppressive policies continue to deprive Zimbabweans of their basic Constitutional rights.

The Sunday Times report said Barclays made £34 million in profit in Zimbabwe last year, which is extremely negligible in terms of the bank’s profits worldwide. So the question remains as to why Barclays chooses to continue funding the government by operating in Zimbabwe.

Barclays made headlines earlier this year when it was alleged that ABSA, its subsidiary in South Africa, was funding fuel supplies for the Zimbabwean government, which included jet fuel for military airplanes. The allegations were made by a British NGO called Rights and Accountability in Development (RAID), which monitors corporate ethics in third world development.

At the time the group said they had reported the matter to the British Foreign Office, which is responsible for sanctions, and the Department of Trade and Industry which handles corporate governance and ethical behaviour by British registered companies and banks.

Meanwhile, lands and security minister Didymus Mutasa reportedly admitted, during closed hearings in a court in Paris recently, that the government was wrong to seize white farms which belonged to a group of 10 Dutch citizens 5 years ago. The Dutch citizens were not compensated for their properties and the court is now reportedly considering what amount the Zimbabwe government should pay.
Five years after their homes and livelihoods were taken by President Robert Mugabe's supporters, a group of 10 Dutch citizens who farmed in Zimbabwe have presented their case for compensation to an international tribunal in Paris.

Lands and security minister Didymus Mutasa appeared in the Paris court, despite a visa ban by the European Union on Mutsasa and members of the ruling Zanu PF.
The ban was temporarily lifted to allow him to travel to Paris to give evidence at the tribunal ten days ago. The hearings were closed to the media and the public.

The farmers took their case to the Washington-based International Center for Settlement of the Investment Disputes calling for the Mugabe government to admit breaching a bilateral investment treaty with the Netherlands. Mutasa admitted in court that the treaty had been broken.
The court is expected to present its ruling on the amount of compensation the farmers should receive before March next year.

If Mugabe's administration fails to pay compensation to the farmers, they would have the right to seize any Zimbabwe government property outside the country including loans from the World Bank and export earnings.
There are an additional 50 farmers from Switzerland, Germany and Denmark whose lands have been seized and who are also preparing to go to the tribunal to get compensation. All of them come from countries that have similar treaties with Zimbabwe.

More than 4,000 white farmers and hundreds of thousands of their workers lost homes and incomes during the land seizures. The land grab began after President Mugabe suffered his first political defeat in 2000 when he lost a referendum for a new constitution that same year.
Zimbabwean Bob Fernandes, now living in Britain, is chairman of a group called AgricAfrica, which helps pay for the farmers' legal fees. He said he hoped this case would eventually lead to fair compensation for all Zimbabwe farmers who were evicted from their homes.

A source close to the Dutch farmers, who have now all left Zimbabwe, said they have claimed about $48 million (33 million euros).

British lawyer Matthew Coleman, who represented the farmers at the tribunal said in an email: "The Zimbabwean government acknowledged that certain 'deprivations' had taken place without payment of compensation." He added that it would "pay compensation in full as and when it is able to do so."
Mutasa defended the seizure of white-owned farms citing the colonial era in which he said the best agricultural land was taken by white settlers, mostly British.

Most of the nearly 20 million acres seized by the government from white farmers since 2000 is now lying idle. Less than 10 percent of evicted white farmers have received compensation in the last seven years at less than 3 percent of the value of the properties.

The collapse of commercial agriculture triggered the dramatic downturn of the Zimbabwe economy which now has the highest inflation in the world at nearly 8,000 percent. Once the breadbasket of Africa, Zimbabwe now depends on international aid to feed at least a quarter of the population.