Keep Us Strong WikiLeaks logo

Currently released so far... 97115 / 251,287

Articles

Browse latest releases

Browse by creation date

Browse by origin

A B C D F G H I J K L M N O P Q R S T U V W Y Z

Browse by tag

A B C D E F G H I J K L M N O P Q R S T U V W X Y Z
ETRD EAGR ETTC EAID ECON EFIN ECIN EINV ELAB EAIR ENRG EPET EWWT ECPS EIND EMIN ELTN EC ETMIN EUC EZ ET ELECTIONS ENVR EU EUN EG EINT ER ECONOMICS ES EMS ENIV EEB EN ECE ECOSOC EK ENVIRONMENT EFIS EI EWT ENGRD ECPSN EXIM EIAD ERIN ECPC EDEV ENGY ECTRD EPA ESTH ECCT EINVECON ENGR ERTD EUR EAP EWWC ELTD EL EXIMOPIC EXTERNAL ETRDEC ESCAP ECO EGAD ELNT ECONOMIC ENV ETRN EIAR EUMEM ENRGPARMOTRASENVKGHGPGOVECONTSPLEAID EREL ECOM ECONETRDEAGRJA ETCC ETRG ECONOMY EMED ETR ENERG EITC EFINOECD EURM EENG ERA EXPORT ENRD ECONEINVETRDEFINELABETRDKTDBPGOVOPIC EGEN EBRD EVIN ETRAD ECOWAS EFTA ECONETRDBESPAR EGOVSY EPIN EID ECONENRG EDRC ESENV ETT EB ENER ELTNSNAR ECHEVARRIA ETRC EPIT EDUC ESA EFI ENRGY ESCI EE EAIDXMXAXBXFFR EETC ECIP EIAID EIVN EBEXP ESTN EING EGOV ETRA EPETEIND ELAN ETRDGK EAIDRW ETRDEINVECINPGOVCS EPEC ENVI ELN EAG EPCS EPRT EPTED ETRB EUM EAIDS EFIC EFINECONEAIDUNGAGM EAIDAR ESF EIDN ELAM EDU EV EAIDAF ECN EDA EXBS EINTECPS ENRGTRGYETRDBEXPBTIOSZ EPREL EAC EINVEFIN ETA EAGER EINDIR ECA ECLAC ELAP EITI EUCOM ECONEFINETRDPGOVEAGRPTERKTFNKCRMEAID EARG ELDIN EINVKSCA ENNP EFINECONCS EFINTS ECCP ETC EAIRASECCASCID EINN ETRP EAIDNI EFQ ECOQKPKO EGPHUM EBUD ECONEINVEFINPGOVIZ ENERGY ELB EINDETRD EMI ECONEFIN EIB EURN ETRDEINVTINTCS EIN EFIM ETIO ELAINE EMN EATO EWTR EIPR EINVETC ETTD ETDR EIQ ECONCS EPPD ENRGIZ EISL ESPINOSA ELEC EAIG ESLCO EUREM ENTG ERD EINVECONSENVCSJA EEPET EUNCH ECINECONCS ETRO ETRDECONWTOCS ECUN EFND EPECO EAIRECONRP ERGR ETRDPGOV ECPN ENRGMO EPWR EET EAIS EAGRE EDUARDO EAGRRP EAIDPHUMPRELUG EICN ECONQH EVN EGHG ELBR EINF EAIDHO EENV ETEX ERNG ED
KMDR KPAO KPKO KJUS KCRM KGHG KFRD KWMN KDEM KTFN KHIV KGIC KIDE KSCA KNNP KHUM KIPR KSUM KISL KIRF KCOR KRCM KPAL KWBG KN KS KOMC KSEP KFLU KPWR KTIA KSEO KMPI KHLS KICC KSTH KMCA KVPR KPRM KE KU KZ KFLO KSAF KTIP KTEX KBCT KOCI KOLY KOR KAWC KACT KUNR KTDB KSTC KLIG KSKN KNN KCFE KCIP KGHA KHDP KPOW KUNC KDRL KV KPREL KCRS KPOL KRVC KRIM KGIT KWIR KT KIRC KOMO KRFD KUWAIT KG KFIN KSCI KTFIN KFTN KGOV KPRV KSAC KGIV KCRIM KPIR KSOC KBIO KW KGLB KMWN KPO KFSC KSEAO KSTCPL KSI KPRP KREC KFPC KUNH KCSA KMRS KNDP KR KICCPUR KPPAO KCSY KTBT KCIS KNEP KFRDCVISCMGTCASCKOCIASECPHUMSMIGEG KNNB KGCC KINR KPOP KMFO KENV KNAR KVIR KDRG KDMR KFCE KNAO KDEN KGCN KICA KIMMITT KMCC KLFU KMSG KSEC KUM KCUL KMNP KSMT KCOM KOMCSG KSPR KPMI KRAD KIND KCRP KAUST KWAWC KTER KCHG KRDP KPAS KITA KTSC KPAOPREL KWGB KIRP KJUST KMIG KLAB KTFR KSEI KSTT KAPO KSTS KLSO KWNN KPOA KHSA KNPP KPAONZ KBTS KWWW KY KJRE KPAOKMDRKE KCRCM KSCS KWMNCI KESO KWUN KPLS KIIP KEDEM KPAOY KRIF KGICKS KREF KTRD KFRDSOCIRO KTAO KJU KWMNPHUMPRELKPAOZW KEN KO KNEI KEMR KKIV KEAI KWAC KRCIM KWCI KFIU KWIC KCORR KOMS KNNO KPAI KBWG KTTB KTBD KTIALG KILS KFEM KTDM KESS KNUC KPA KOMCCO KCEM KRCS KWBGSY KNPPIS KNNPMNUC KWN KERG KLTN KALM KCCP KSUMPHUM KREL KGH KLIP KTLA KAWK KWMM KVRP KVRC KAID KSLG KDEMK KX KIF KNPR KCFC KFTFN KTFM KPDD KCERS KMOC KDEMAF KMEPI KEMS KDRM KEPREL KBTR KEDU KNP KIRL KNNR KMPT KISLPINR KTPN KA KJUSTH KPIN KDEV KTDD KAKA KFRP KWNM KTSD KINL KJUSKUNR KWWMN KECF KWBC KPRO KVBL KOM KFRDKIRFCVISCMGTKOCIASECPHUMSMIGEG KEDM KFLD KLPM KRGY KNNF KICR KIFR KM KWMNCS KAWS KLAP KPAK KDDG KCGC KID KNSD KMPF KPFO KDP KCMR KRMS KNPT KNNNP KTIAPARM KDTB KNUP KPGOV KNAP KNNC KUK KSRE KREISLER KIVP KQ KTIAEUN KPALAOIS KRM KISLAO KWM KFLOA
PHUM PINR PTER PGOV PREL PREF PL PM PHSA PE PARM PINS PK PUNE PO PALESTINIAN PU PBTS PROP PTBS POL POLI PA PGOVZI POLMIL POLITICAL PARTIES POLM PD POLITICS POLICY PAS PMIL PINT PNAT PV PKO PPOL PERSONS PING PBIO PH PETR PARMS PRES PCON PETERS PRELBR PT PLAB PP PAK PDEM PKPA PSOCI PF PLO PTERM PJUS PSOE PELOSI PROPERTY PGOVPREL PARP PRL PNIR PHUMKPAL PG PREZ PGIC PBOV PAO PKK PROV PHSAK PHUMPREL PROTECTION PGOVBL PSI PRELPK PGOVENRG PUM PRELKPKO PATTY PSOC PRIVATIZATION PRELSP PGOVEAIDUKNOSWGMHUCANLLHFRSPITNZ PMIG PREC PAIGH PROG PSHA PARK PETER POG PHUS PPREL PS PTERPREL PRELPGOV POV PKPO PGOVECON POUS PGOVPRELPHUMPREFSMIGELABEAIDKCRMKWMN PWBG PMAR PREM PAR PNR PRELPGOVEAIDECONEINVBEXPSCULOIIPBTIO PARMIR PGOVGM PHUH PARTM PN PRE PTE PY POLUN PPEL PDOV PGOVSOCI PIRF PGOVPM PBST PRELEVU PGOR PBTSRU PRM PRELKPAOIZ PGVO PERL PGOC PAGR PMIN PHUMR PVIP PPD PGV PRAM PINL PKPAL PTERE PGOF PINO PHAS PODC PRHUM PHUMA PREO PPA PEPFAR PGO PRGOV PAC PRESL PORG PKFK PEPR PRELP PREFA PNG PGOVPHUMKPAO PRELECON PINOCHET PFOR PGOVLO PHUMBA PRELC PREK PHUME PHJM POLINT PGOVPZ PGOVKCRM PGOVE PHALANAGE PARTY PECON PEACE PROCESS PLN PRELSW PAHO PEDRO PRELA PASS PPAO PGPV PNUM PCUL PGGV PSA PGOVSMIGKCRMKWMNPHUMCVISKFRDCA PGIV PRFE POGOV PEL PBT PAMQ PINF PSEPC POSTS PHUMPGOV PVOV PHSAPREL PROLIFERATION PENA PRELTBIOBA PIN PRELL PGOVPTER PHAM PHYTRP PTEL PTERPGOV PHARM PROTESTS PRELAF PKBL PRELKPAO PKNP PARMP PHUML PFOV PERM PUOS PRELGOV PHUMPTER PARAGRAPH PERURENA PBTSEWWT PCI PETROL PINSO PINSCE PQL PEREZ PBS

Browse by classification

Community resources

courage is contagious

Viewing cable 04HARARE564, IMF Advocates Devaluation

If you are new to these pages, please read an introduction on the structure of a cable as well as how to discuss them with others. See also the FAQs

Understanding cables
Every cable message consists of three parts:
  • The top box shows each cables unique reference number, when and by whom it originally was sent, and what its initial classification was.
  • The middle box contains the header information that is associated with the cable. It includes information about the receiver(s) as well as a general subject.
  • The bottom box presents the body of the cable. The opening can contain a more specific subject, references to other cables (browse by origin to find them) or additional comment. This is followed by the main contents of the cable: a summary, a collection of specific topics and a comment section.
To understand the justification used for the classification of each cable, please use this WikiSource article as reference.

Discussing cables
If you find meaningful or important information in a cable, please link directly to its unique reference number. Linking to a specific paragraph in the body of a cable is also possible by copying the appropriate link (to be found at theparagraph symbol). Please mark messages for social networking services like Twitter with the hash tags #cablegate and a hash containing the reference ID e.g. #04HARARE564.
Reference ID Created Released Classification Origin
04HARARE564 2004-04-01 12:52 2011-08-24 16:30 UNCLASSIFIED Embassy Harare
This record is a partial extract of the original cable. The full text of the original cable is not available.

011252Z Apr 04
UNCLAS SECTION 01 OF 02 HARARE 000564 
 
SIPDIS 
 
STATE FOR AF/S AND AF/EX 
NSC FOR SENIOR AFRICA DIRECTOR JFRAZER 
USDOC FOR AMANDA HILLIGAS 
TREASURY FOR OREN WYCHE-SHAW 
PASS USTR FLORIZELLE LISER 
STATE PASS USAID FOR MARJORIE COPSON 
 
E. O. 12958: N/A 
TAGS: ECON ETRD EINV PGOV ZI
SUBJECT: IMF Advocates Devaluation 
 
 
1. Summary: International Monetary Fund (IMF) Southern 
Africa Chief Doris Ross has called on the GOZ to devalue, 
spend less and restart tripartite discussions.  She also 
predicted the IMF Board of Governors would neither 
restore privileges nor expel Zimbabwe from the lending 
body as a result of these talks, freezing the country's 
current suspended status.  While the Ross delegation 
prescribed sound medicine, we do not yet see a GOZ 
willingness to swallow the pill.  End summary. 
 
2. Ross' IMF delegation held Article IV consultations in 
Zimbabwe March 17-31.  Reserve Bank Governor Gideon Gono 
has repeatedly stated he wants to lead Zimbabwe back to 
IMF reengagement.  At a diplomatic briefing, Ross 
summarized her delegation's findings for us.  Highlights 
follow. 
 
Foreign Currency Generation 
--------------------------- 
3. Concerning forex inflows from exports, Ross lamented 
that her crew had not "gotten to the bottom of the story" 
despite repeated queries. She estimated the GOZ was 
sending at least half its export proceeds to underfunded 
currency auctions, where it sells US$16 million each week 
to importers at a preferential, overvalued rate.  She did 
not believe the current supply of forex to the auction 
system was sustainable.  However, she argued the 
auctions, introduced in January, provided a handy 
mechanism for the RBZ to depreciate its currency to 
reflect market conditions, even if the RBZ has not yet 
deployed it effectively.  Only an export rebound could 
lead a recovery, Ross stressed. 
 
Fiscal Policy 
------------- 
4. Ross complained of fiscal indiscipline, noting the 
2004 budget "was not conducive to bringing inflation 
down."  Last year's budget deficit reached 7.5 percent of 
GDP.  While high inflation continually drives down the 
rate of domestic debt on borrowed funds, she expects the 
GOZ will require a supplementary budget this year. 
Government ministries and parastatals are still enjoying 
very cheap forex. 
 
5. The IMF advised the GOZ to adapt its tax collection to 
this high-inflation environment, suggesting both that 
firms pay estimates during the year and that the GOZ 
readjust rates more frequently to account for bracket 
creep.  If the GOZ abolishes its 25 percent retention of 
export earnings, it will face a significant budget 
shortfall.  On the other hand, the 2004 budget did not 
account for a 5-fold increase in customs collections on 
imports, which came about when Gono decided to assess 
goods using the new auction rate.  The IMF bemoaned 
inconsistent terms of domestic borrowing, where the RBZ's 
T-bills compounded either daily, monthly or quarterly 
while the Finance Ministry's own bonds compound daily. 
Due to high inflation, the means of compounding causes 
effective rates to vary wildly. 
 
Agricultural Rebound 
-------------------- 
6. Ross opined that mining might some day lead a 
recovery, since there is no short-term means to 
reinvigorate post-land reform agriculture.  Special 
Affairs Minister John Nkomo, who now has the GOZ lead on 
land reform, told the delegation he wanted to prepare by 
May a register of farm occupants and end multiple farm 
holdings.  Nkomo said he sought to introduce 99-year 
leases for large-scale resettled farms (A2s) as well as 
communal farms that could serve as collateral for bank 
loans. 
 
Other Findings 
--------------- 
7. In addition, the IMF group added: 
- The GOZ should reconvene Tripartite talks with business 
and labor.  The GOZ has no formal dialogue with the 
Zimbabwe Confederation of Trade Unions at this time. 
- The IMF foresees a GDP decline of 4-5 percent in 2004, 
significantly below the GOZ's own 8-9 percent estimate. 
Partly, a GOZ double counting of certain service charges 
may explain the difference.  Although fodder for 
methodological debate, the IMF now believes GDP has 
receded 30 percent in five years, versus alternative 
estimates as high as 40 percent. 
- There are still too many banks for Zimbabwe's shrunken 
economy, even after the current shakedown. Due to 
negative borrowing rates, however, the sector has a low 
ratio of non-performing loans. 
- Zimbabwe may soon reach Heavily Indebted Poor Country 
(HIPC) levels, given current debt-to-export levels.  If 
the country returns to good standing with the IMF, it 
will almost certainly have to restructure external debt. 
- The Finance Ministry and RBZ should better coordinate 
economic policy.  Since Gono became RBZ governor in 
December, the Finance Ministry's role has become 
marginal. 
- Gono will make another policy statement in mid-April. 
The besieged export sector hopes for relief at that time. 
- By next year, the GOZ's entire IMF debt - currently 
$310 million - will have fallen into arrears.  Ross has 
been told a symbolic payment of US$6 million is in the 
pipeline, and that the GOZ would pay missing portions of 
similar symbolic payments begun since 2001. 
- In conclusion, Ross speculated that IMF governors would 
neither expel Zimbabwe nor restore its privileges, 
although she noted that it would be IMF management 
recommending to the Board and the Board deciding. 
 
Comment 
------- 
8. Ross, who has learned much about Zimbabwe since her 
first consultations in 2003, carried the right message - 
export promotion, fiscal control and dialogue.  She would 
not speculate upon GOZ receptivity.  Although government 
interlocutors asked anxiously when they might access IMF 
money, this Government probably accomplished all it could 
by staving off expulsion.  On the other hand, we were 
disappointed the eager-to-reengage RBZ is still unwilling 
to handle data objectively and transparently.  The GOZ 
treats weekly export revenues as a state secret, invents 
unfounded maize harvest projections and offers no public 
accounting of resettled farmers.  We do not believe it 
will act decisively to turn the economy around until it 
confronts these ghosts. 
 
Sullivan