VZCZCXRO7595
RR RUEHBZ RUEHDU RUEHJO RUEHMR RUEHRN
DE RUEHSB #1040/01 3290542
ZNR UUUUU ZZH
R 240542Z NOV 08
FM AMEMBASSY HARARE
TO RUEHC/SECSTATE WASHDC 3730
RUCNSAD/SOUTHERN AF DEVELOPMENT COMMUNITY COLLECTIVE
RUEHUJA/AMEMBASSY ABUJA 2129
RUEHAR/AMEMBASSY ACCRA 2457
RUEHDS/AMEMBASSY ADDIS ABABA 2575
RUEHRL/AMEMBASSY BERLIN 1075
RUEHBY/AMEMBASSY CANBERRA 1851
RUEHDK/AMEMBASSY DAKAR 2206
RUEHKM/AMEMBASSY KAMPALA 2631
RUEHNR/AMEMBASSY NAIROBI 5059
RUEHGV/USMISSION GENEVA 1723
RHEHAAA/NSC WASHDC
RHMFISS/EUCOM POLAD VAIHINGEN GE
RUZEJAA/JAC MOLESWORTH RAF MOLESWORTH UK
RHEFDIA/DIA WASHDC
RUEAIIA/CIA WASHDC

UNCLAS SECTION 01 OF 03 HARARE 001040 
 
SIPDIS 
 
AF/S FOR B. WALCH 
ADDIS ABABA FOR USAU 
ADDIS ABABA FOR ACSS 
NSC FOR SENIOR AFRICA DIRECTOR B.PITTMAN 
TREASURY FOR D. PETERS 
STATE PASS TO USAID FOR L.DOBBINS AND E.LOKEN 
COMMERCE FOR BECKY ERKUL 
 
E.O.12958: N/A 
TAGS: PGOV PREL ASEC PHUM ECON ZI
SUBJECT: ZIM NOTES 11-21-2008 
 
----------- 
¶1.  SUMMARY 
----------- 
 
Topics of the week: 
 
- Still No Political Progress 
- Health System Collapses 
- While Cholera Crisis Continues 
- Over 700 Doctors and Nurses Protest 
- Biti Still Faces Treason Charges 
- Tsvangirai's Travels Could Land Him in Jail 
- Freedom Defenders win awards 
- Reserve Bank of Zimbabwe Reads Riot Act to Zimbabwe Stock 
Exchange 
- Dollarization Gathers Momentum 
- Old Mutual Shares Used to Secure Electricity Imports 
- Foreign Currency Shops Disappoint 
- Quote of the Week 
 
--------------------------------- 
¶2.  Price Movements-Exchange Rate 
and Selected products 
--------------------------------- 
 
Parallel rate for cash shot up to Z$1,000,000:US$1 
 
Check rate is steady at Z$20 quadrillion:US$1 against inter-bank 
average of Z$25,593:US$1 (NOTE: Due to the suspension of the 
Real-Time Gross Settlement system by the Reserve Bank of Zimbabwe on 
October 3, Post will now be reporting on the unofficial check 
transfer rate that individuals and entities are using to make 
non-cash payments. END NOTE.) 
 
Bread on the parallel market tripled to Z$1,500,000 
 
Sugar rose to Z$3,000,000/2kg 
 
Petrol and diesel rose slightly to Z$1,200,000/liter 
 
----------------------------- 
On the Political/Social Front 
----------------------------- 
 
¶3.  Still No Political Progress...  In the wake of the SADC summit 
last week, MDC leader Morgan Tsvangirai has been visiting European 
leaders to press his case and encourage humanitarian assistance. 
Meanwhile, the GOZ has drafted Constitutional Amendment 19 that will 
legally reflect the terms of the September 15 signed power-sharing 
agreement.  Press reports revealed that a draft of the amendment has 
been provided to mediator Thabo Mbeki.  The MDC-T has made clear 
they will not join a new government until all their concerns - that 
were not deliberated at the summit - are addressed.  See Harare 1037 
and Harare 1034. 
 
¶4.  Health System Collapses...  Once a model for sub-Saharan Africa, 
the Zimbabwean public health system has ceased to function.  All 
three of Harare's public hospitals are closed, church-related 
hospitals struggle to absorb patients fleeing Harare to seek care in 
rural areas, and even private clinics struggle to maintain supplies 
and staff.  For a detailed description of the collapse, see Harare 
¶1039. 
 
¶5.  While Cholera Crisis Continues... Outbreaks continue in two 
Harare-area locations while a new upsurge with potentially 
widespread consequences is occurring in Beitbridge, the border post 
with South Africa.  UNICEF reported 1,244 confirmed and 2,590 
unconfirmed cases, with a total of 194 confirmed cholera deaths as 
of November 18.  Medecins Sans Frontieres (MSF) estimated that up to 
 
HARARE 00001040  002 OF 003 
 
 
1.4 million people are at risk if cholera continues to spread 
unchecked across Zimbabwe.  The humanitarian community is responding 
with water, sanitation, and hygiene initiatives in outbreak areas, 
but a collapsing healthcare system has lead to uncommonly high 
case-fatality rates. 
 
¶6.  Over 700 Doctors and Nurses Protest...  Hundreds of medical 
professionals attempted to march from Parirenyatwa Hospital to the 
Ministry of Health to present demands for medication and supplies in 
hospitals and living wages for health workers on November 18. 
Around 70 riot police armed with tear gas and batons arrived at the 
hospital and prevented protesters from leaving the parking lot. 
After several hours, riot police violently disrupted the protest, 
beating some health workers; fortunately, no one was seriously 
injured or arrested. 
 
¶7.  Biti Still Faces Treason Charges...  On November 18, a court 
dropped two of the four charges facing MDC Secretary General and MP 
for Harare East Tendai Biti. Charges of Qinsulting the president 
and Qcausing disaffection to the armed forcesQ were dropped.  Biti 
still faces treason charges and charges related to Qmaking 
statements likely to cause public disorder.Q His next hearing will 
be on December 4. 
 
¶8.  Tsvangirai's Travels Could Land Him In Jail... Morgan Tsvangirai 
continues to travel using an Emergency Travel Document (ETD) while 
he awaits a passport.  Although his current ETD limits his travel to 
South Africa and Swaziland, Tsvangirai made arrangements with 
European leaders to travel to the EU without a passport.  Now, the 
Zimbabwean government is reportedly furious that the South Africans 
allowed him to fly to Europe.  Local press speculation is that if he 
violated Zimbabwean laws he will be arrested upon his return to 
Zimbabwe. 
 
 
¶9.  Freedom Defenders win awards... Zimbabwe Lawyers for Human 
Rights (ZLHR) is the winner of the Rights & Democracy 2008 John 
Humphrey Freedom Award in recognition of its courageous pursuit of 
justice for victims of human rights abuses inside Zimbabwe.  Women 
of Zimbabwe Arise won Amnesty International GermanyQs Human Rights 
Award.  Jenni Williams and Magodonga Mahlangu, who are still on 
bail, were granted permission to travel to Germany to receive the 
award. In New York, Lawyer Beatrice Mtetwa received the Committee to 
Protect JournalistQs Lifetime Achievement Award.  Mtetwa has 
represented numerous journalists, including New York Times reporter 
Barry Bearak when he was arrested in Zimbabwe earlier this year. 
 
---------------------------------- 
On the Economic and Business Front 
---------------------------------- 
 
¶10.  Reserve Bank of Zimbabwe (RBZ) Reads Riot Act to Zimbabwe Stock 
Exchange (ZSE)... The RBZ issued a stern warning to the ZSE for its 
role in processing bad checks worth up to Z$40 sextillion (US$2 
million at the current check rate). The RBZ directed that anyone who 
failed to settle at the end of the day would have their accounts 
closed and their trading privileges revoked.  Consequently, activity 
on the ZSE dropped dramatically with the industrial index falling by 
58.2 percent on November 19. 
 
¶11.  Dollarization Gathers Momentum... One of the largest fast food 
chains in the country is now accepting payment for meals in fuel 
coupons which are convertible into foreign currency. The food chain 
joins a growing list of companies and private schools that demand 
payment for goods and services in coupons. In a related development, 
the state-owned Zimbabwe Newspapers Group no longer accepts personal 
or bank checks for payment of subscriptions. Only bulk subscriptions 
for companies are still payable in checks. However, ordinary 
subscriptions are still open to those willing to pay US$10 per 
 
HARARE 00001040  003 OF 003 
 
 
month. 
 
¶12.  Old Mutual Shares Used to Secure Electricity Imports...  The 
local press reports that Old Mutual shares, which are registered on 
the ZSE, the Johannesburg Stock Exchange (JSE) and the London Stock 
Exchange (LSE), are being used as collateral for South African 
electricity imports.  The RBZ buys shares on the ZSE and transfers 
them to the JSE where they are held in the pension fund of South 
African utility company Eskom. 
 
¶13.  Foreign Currency Shops Disappoint...  Early signs indicate that 
the forex licenses sold to some local shops have not generated 
enough foreign currency income for retailers.  Consequently, 
manufacturers are still not generating enough forex to improve their 
low capacity utilization rates.  The prices of forex-priced goods 
have not come down either, while shelves dedicated to selling basic 
goods (such as bread) in local currency are empty, leaving the 
majority of Zimbabweans without options. 
 
MCGEE