Finance minister Tendai Biti sought the removal of three banks on the United States sanctions list arguing this would aid the country’s economic reforms, latest cables released by whistleblower website WikiLeaks have revealed.
According to a letter written by Biti to US envoy Charles Ray in December 2009, delisting the Infrastructure Development Bank of Zimbabwe , Agribank and ZB Bank and Building Society (ZB), would support his economic reforms.
“As specially designated nationals (SDNs) these banks cannot conduct transactions with US banks and are therefore unable to undertake normal treasury operations. This has resulted in the slow pace of some government projects and programmes,” wrote Ray in his report.
Ray said the motivation behind Biti’s request was not to throw Zanu PF a bone, but rather to see US government policies adjust to the new circumstances in Zimbabwe.
The US envoy said the Finance minister would like to see these three banks contributing to Zimbabwe’s economic recovery.
Biti argued in his letter that like all commercial banks in Zimbabwe, Agribank and ZB sustained severe financial losses during the hyperinflationary period and their status as SDNs impeded recapitalisation.
The ambassador said Biti would like to sell a portion of the government stake in both banks, but this was not practical while they were SNDs.
“I believe it is in our interest to honour Biti’s request. Zanu PF no longer has the means to abuse these three banks. The only risk in removing them from the SDN list is that (President) Mugabe may get the incorrect impression that we are loosening the screws on him and his cronies. But that will be their problem, not ours, and it would serve to weaken the impact of Zanu PF’s continuing rhetoric regarding sanctions and their economic impact,” Ray said in his recommendations to Washington.
“I recommend that we honour Biti’s request. The information available to me indicates that these three banks no longer have any role in supporting President Mugabe. This would cost us little while working to the advantage of reformers who stick their necks out to bring democracy back to Zimbabwe, and it would serve to undercut and weaken Zanu PF rhetoric regarding sanctions.
“There is, I sincerely believe, far greater risk for us in ignoring Biti’s request. Biti, his MDC colleagues and other brave Zimbabweans are in a high-stakes, long-term struggle to restore democracy to their country. We should not miss opportunities to help them “chip away at the fascist dictatorship,” as Biti likes to put it.
Ray said de-listing the banks was not going to hurt the US but would let Biti push his reform agenda a few inches forward and further bolster his standing as the most effective minister in the transitional government.
“If we believe sanctions give us leverage, now is the time to use it to Biti’s advantage and perhaps be an impetus at some point for further moves in a positive direction,” wrote Ray.