Old Mutual gets Vic Falls

FINALLY, Al Jazeera aired the first of the four-part series documentary Gold Mafia. Social media went into overdrive, with many people condemning the attitude and character of some of those implicated.

However, the gold mafia is only but one of those things happening as privatisation of public land is also on the increase.

The frightening thing about the gold mafia is how its activities are abetted by the State in the name of sanctions busting.

Secondly, the big players in gold smuggling or money-laundering are Anglo-Saxons or Indians.

Indigenous players do not have the international exposure and connections with the humongous amounts of money needed.

Uebert Angel, the Zimbabwe ambassador-at-large to Europe and Americas, at some point in the documentary admitted that he and his syndicate had never washed US$1,2 billion because most of their deals rarely topped US$300 million.

This is a big boys’ league and the players show it. Flying first or business class on the Fly Emirates everyday pushing gold is no joke.

In the meantime, let us get back to the continued privatisation of land under the Emmerson Mnangagwa administration.

The ink has not dried on the US$60 billion new Mount Hampden City that is being privately developed and will be run by a company for 15 years.

In Cabinet briefing number 2 of 2023, government was clear that the new city plan will be replicated.

Less than a month later, we are now aware that another private city is being developed in Victoria Falls as a joint venture between financial behemoth Old Mutual and the government of Zimbabwe.

The Zimbabwean government in 2013 created the Mosi-oa-Tunya Development Company for the hosting of the United Nations World Tourism Organisation conference.

The company’s mandate has since been broadened to spearhead the development of the Masuwe Special Economic Zone on a 1 200-hectare (ha) piece of land.

In a post-Cabinet statement, government said: “In August 2020, Cabinet broadened the mandate of the company to cover tourism infrastructure development in Victoria Falls. The company subsequently entered into a joint venture partnership with Old Mutual Life Assurance Company for financing a feasibility study for the development of backbone infrastructure for the Masuwe Special Economic Zone, measuring 1 200 hectares.”

Old Mutual has lots of properties in all urban areas. It has shopping malls and high rise buildings across the country.

However, the Victoria Falls gig will become one of the biggest single investments in Zimbabwe and more importantly creating an offshore financial hub.

In the signed agreements, Old Mutual will develop the project in two phases. The first phase entails construction of bulk water supply systems for the entire Masuwe and development of internal water, sanitation, roads and storm water drains at an estimated total cost of US$120 million.

Phase 2 of the project will witness the development of the remaining 930ha at an expected cost of US$85 million. The project is expected to be complete in 24 months.

It is easy to understand why Old Mutual jumped at the project. The project is a simple money spinner and will churn out good profits.

Cabinet said: “The feasibility study appraisal indicated that the development project is viable, with an acceptable profit margin of US$57 696 447, which is 15,5% and 18,2% of gross development value and development cost, respectively.”

The financial group will have a free pass to construct a four-star hotel with a 5 000-seater conference facility, medical tourism facilities, a golf estate and a shopping mall on land which government will allocate. The project will also use green energy in the form of solar.

Government has further sweetened the deal by declaring Masuwe a special economic zone. This means it is exempt from many of the labour and tax laws that affect any other investor operating in Zimbabwe.

It should be restated that since Mthuli Ncube became Finance minister, he has been working hard to make Victoria Falls an offshore location or a tax haven like Monaco and Jersey Islands.

This will make it a playground for the rich and famous who want to make super profits, pay the least in taxation and easily transfer their money to other destinations without cumbersome paperwork: The exact conditions that capital wants to feed its insatiable appetite without regard for the communities surrounding them.

The modus operandi of developing the New City in Harare is being replicated in Victoria Falls.

Cabinet says the status of a special economic zone would ensure that the project raises funds for self-financing. This will be another city run by a private company with zero accountability to anyone.

On a serious note, Zimbabwe is speeding into the territory of charter cities.

As a means to contain a fallout with citizens, Cabinet said the government will have “a shareholding on every portion of the land earmarked for development projects in Victoria Falls”.

The fact remains that the plan is opaque and has not been subjected to scrutiny by citizens’ representatives in Parliament. The tax incentives for the special economic zone should be debated and passed by Parliament. It should not be merely an Executive decision.

I cannot help but conclude by paraphrasing Naomi Klein in her book, The Shock Doctrine: The Rise of Disaster Capitalism.

Klein compellingly argues that in times of disaster when people are shocked, capitalists and governments introduce a crude dosage of capitalism.

In the last three years post the COVID-19 outbreak, Zimbabwe has privatised health, education and now even cities, while the people are still in shock.

Parliament should for once have a spine and scrutinise these deals where public land is being put into private hands for development of charter cities in an arbitrary manner.

The deals should be tabled in Parliament for debate, nothing short. Otherwise, we will wake up back in 1890 with a new version of the British South Africa Company running Zimbabwe.

Source: Old Mutual gets Vic Falls (25/03/2023)

See Also:

Victoria Falls Bits and Blogs (15th September 2019) Old Mutual to construct ‘massive’ hotel in Vic Falls.

Victoria Falls Bits and Blogs (2nd June 2021) Old Mutual, Govt strike Vic Falls land deal for new hotel project.

Victoria Falls Bits and Blogs (24th March 2023a) How a ‘Gold Mafia’ is looting Southern Africa, washing dirty cash.

Victoria Falls Bits and Blogs (24th March 2023b) Govt okays Victoria Falls SEZ.