VZCZCXRO8376
RR RUEHBZ RUEHDU RUEHJO RUEHMR RUEHRN
DE RUEHSB #0243/01 0881001
ZNR UUUUU ZZH
R 281001Z MAR 08 ZDK NUMEROUS SVC'S
FM AMEMBASSY HARARE
TO RUEHC/SECSTATE WASHDC 2640
RUCNSAD/SOUTHERN AF DEVELOPMENT COMMUNITY COLLECTIVE
RUEHUJA/AMEMBASSY ABUJA 1892
RUEHAR/AMEMBASSY ACCRA 1845
RUEHDS/AMEMBASSY ADDIS ABABA 1969
RUEHRL/AMEMBASSY BERLIN 0542
RUEHBY/AMEMBASSY CANBERRA 1246
RUEHDK/AMEMBASSY DAKAR 1603
RUEHKM/AMEMBASSY KAMPALA 2025
RUEHNR/AMEMBASSY NAIROBI 4456
RUEHGV/USMISSION GENEVA 1096
RUEAIIA/CIA WASHDC
RHEFDIA/DIA WASHDC
RHEHAAA/NSC WASHDC
RHMFISS/EUCOM POLAD VAIHINGEN GE
RUAEJAA/JAC MOLESWORTH RAF MOLESWORTH UK

UNCLAS SECTION 01 OF 03 HARARE 000243 
 
SIPDIS 
 
AF/S FOR S.HILL 
ADDIS ABABA FOR USAU 
ADDIS ABABA FOR ACSS 
NSC FOR SENIOR AFRICA DIRECTOR B.PITTMAN 
TREASURY FOR J.RALYEA AND T.RAND 
STATE PASS TO USAID FOR L.DOBBINS AND E.LOKEN 
COMMERCE FOR BECKY ERKUL 
 
SIPDIS 
 
E.O.12958: N/A 
TAGS: PGOV PREL ASEC PHUM ECON ZI
SUBJECT: Zim Notes 03-28-2008 
 
 
HARARE 00000243  001.3 OF 003 
 
 
¶1.  The Embassy Harare Political/Economic Section began producing 
Zim Notes in July, 2007 to present a perspective on current events 
in Zimbabwe.  Suggestions are always welcome. If you would like to 
receive Zim Notes by email, as well, please contact Frances Chisholm 
at chisholmfm@state.gov. Distribution is restricted to U.S. 
government employees. 
 
--------------------------------------------- ------ 
Price Movements-Exchange Rate and Selected Products 
--------------------------------------------- ------ 
 
¶2.  Price Movements-Exchange Rate and Selected products 
Parallel rate for cash steady at ZW$42million:US$1; bank transfer 
rate: Z$65 million; official rate: ZW$$30,000:US$1 
Sugar rose to Z$50 million/2kg vs. controlled price of 
Z$8million/2kg 
Cooking oil more than doubled to Z$95million/750ml vs. controlled 
price of Z$9.3million/750ml 
Petrol and diesel rose to Z$60million/liter vs. controlled price of 
Z$60,000/liter 
----------------------------- 
On the Political/Social Front 
----------------------------- 
 
¶3.  Zimbabweans Head To The Polls...  A poll conducted by the Mass 
Public Opinion Institute of Zimbabwe (MPOI) from March 3 to March 10 
showed the MDCQs Tsvangirai with about 30 percent support, President 
Robert Mugabe with about 20 percent, and Simba Makoni with about 9 
percent.  Thirty percent declined to state a preference; the 
individuals who conducted the poll believe that most of this group 
is sympathetic to the opposition.  The MPOI poll comports with what 
Embassy pre-election teams who visited a number of provinces found: 
significant and growing support for Tsvangirai.  Countering the MPOI 
poll is a poll conducted by Joseph Kurebwa, a University of Zimbabwe 
lecturer known to be sympathetic to Mugabe.  He claims to have 
sampled over 10,000 voters between February 15 and March 15 and 
found that Mugabe had 56 percent support, Tsvangirai 26 percent, and 
Makoni 13 percent.  This poll may be an attempt to justify a Mugabe 
victory which we believe cannot be achieved without significant 
rigging.  See Harare 227. 
 
¶4.  Sparse Attendance At Makoni Meeting In Harare... Independent 
presidential candidate Simba MakoniQs March 26 meeting in Harare 
targeted at women attracted only about 60 people, including SADC 
observers and other independent candidates such as Fay Chung. 
Makoni responded rather unconvincingly to the audience's questions 
on social issues by saying he did not have any answers to their 
concerns but as president would work to remove the barriers put in 
place by ZANU-PF that prevent people from solving their own 
problems.  Makoni also argued that he was not a newcomer and had 
always spoken out against poor GOZ policies when he was on the 
ZANU-PF Central Committee and Politburo. 
 
¶5.  Health Sector Assessment...  Dr. Sambe Duale from Tulane 
University School of Public Health conducted a rapid assessment of 
ZimbabweQs public health system for USAID from March 10-15.  The 
purpose was to provide an independent view of the current state of 
the health care system and formulate recommendations for increased 
support for short-term assistance to mitigate the effects of the 
current social and economic decline.  Despite the difficult and 
deteriorating health care delivery environment, the dedication shown 
by health care workers to maintain service provision is remarkable. 
It is clear, as evidenced by the HIV programs, that little 
investments in the system can yield outstanding results.  While 
health sector human resources, essential drugs, water and 
sanitation, immunization, maternal and newborn health, and supply 
chain logistics management were all recommended areas of focus, 
essential drugs and supply chain delivery would be ripe for rapid 
start-up for USAID given current in-country partners and existing 
 
HARARE 00000243  002.2 OF 003 
 
 
activities. 
 
-------------------------- 
Economic and Businss News 
-------------------------- 
 
¶6.  Tighte Monetary Policy...  In a move to mop up excess liuidity 
that has been averaging Z$4 quadrillion a ay, driven primarily by 
high government expenditre associated with the upcoming elections, 
the Rserve Bank of Zimbabwe (RBZ) this week increased te term of 
excess liquidity management zero-coupo bonds to 90 days from seven 
days; hiked statutor reserve requirements on demand deposits for 
comercial and merchant banks from 35-40 percent to 50percent; and 
increased secured and unsecured accmmodation rates from 1,200 
percent to 4,000 percent and from 1,650 percent to 4,500 percent 
respectively.  It will now be extremely expensive for banks to 
borrow from the RBZ in case of shortages on the market.  While the 
tightening of monetary policy in a hyperinflationary environment is 
welcome, these measures, in fact, penalize banks for a crime they 
did not commit and increase the fragility of the sector by reducing 
banksQ ability to lend profitably to the private sector.  The more 
prudent measure to counter excess liquidity would have been to 
reduce GOZ spending. 
 
¶7.  RBZ Set To Raise Daily Cash Withdrawal Limit...  Daily cash 
withdrawal limits will rise from Z$500 million to Z$5 billion with 
effect on April 4, 2008.  The increase will alleviate a cash 
shortage on the street that has arisen from the high transactions 
demand for cash under hyperinflation.  Although banks are currently 
receiving all the cash they order from the RBZ, the low withdrawal 
limit and consequent shortages slowed depreciation of cash on the 
parallel market this week. 
 
¶8.  Civil Servant Salary Increases And An Apparently Hollow Threat 
Of Another Price Blitz...  The average salary of a civil servant 
went up from Z$100 million in December 2007 to Z$500 million on 
February 12, and was reportedly revised up again last week to more 
than Z$4 billion a month (close to US$100/month).  At a rally on 
March 21, calling price increases part of a scheme to effect regime 
change, President Mugabe threatened the riot act if businesses did 
not roll back prices to February 12 levels.  The GOZ met with the 
business community on March 25 to discuss its Qunjustified price 
increases,Q but an official from the Confederation of Zimbabwe 
Industries (CZI) told us with relief that a price rollback was not 
discussed; the focus was on business abiding by the price control 
mechanisms already in place. 
 
¶9.  No Noticeable Increase In Supermarket Stocks...  Contrary to our 
expectations, and perhaps a sign of just how tight grocery supplies 
continue to be, HarareQs supermarket shelves have failed to fill up 
in this pre-election week.  The aisles are still bare of most 
price-controlled goods like fresh meat (except pork), milk, maize 
meal, cooking oil, sugar, eggs and flour; bread deliveries arrive 
only sporadically. 
 
------------------ 
Quotes Of The Week 
------------------ 
 
¶10.  President Mugabe addressing a rally in Bulawayo on March 23: 
QYou can vote for them (MDC), but that will be a wasted vote.  You 
will be cheating yourself as there is no way we can allow them to 
rule this country. 
 
¶11.  Independent presidential candidate Simba Makoni addressing a 
rally in Chitungwiza on March 20, as reported in The Herald, March 
24: QThere are stories that I have some Qbig wigsQ behind my 
campaign but I want to make it clear today, I have no so-called Qbig 
wigsQ from the ruling party behind my campaign.  My Qbig wigsQ are 
 
HARARE 00000243  003.2 OF 003 
 
 
the people who are going to vote for me... 
 
¶12.  Chorus to the ZANU-PF campaign jingle aired regularly on the 
GOZ-owned radio stations: 
If you want a farm, Vote ZANU-PF 
If you want a business, vote ZANU-PF 
For a visionary leader, vote ZANU-PF 
For consistent leadership, vote ZANU-PF 
 
¶13.  And Another Rich Pre-Election Week for Cartoons... See the Word 
version of Zim Notes for those, and have a safe and quiet weekend. 
 
MCGEE