Robert Mugabe henchmen backed by Barclays

Robert Mugabe henchmen backed by Barclays

Insight
From The Sunday TimesJune 29, 2008
http://www.timesonline.co.uk/tol/news/world/africa/article4232283.ece
Jonathan Calvert and Maurice Gerard


Barclays is flouting European Union sanctions on Zimbabwe by providing two of President Robert Mugabe’s most senior henchmen with bank accounts.

Both men are named on an EU blacklist that compels European-based financial institutions to freeze their bank accounts and have no dealings with them.

Barclays has been able to get around the sanctions by persuading the UK Treasury that the rules do not apply to its 67%-owned Zimbabwean subsidiary because it was incorporated outside the EU.

The two henchmen have been heavily involved in the regime’s crackdown, which in effect fixed Friday’s presidential election in favour of Mugabe. They are Elliot Manyika, minister without portfolio, who is a key figure in the recent violence, and Nicholas Goche, minister of public service, who is said to have masterminded attacks on white farmers.

Yesterday Kate Hoey MP, chairman of the all-party parliamentary group on Zimbabwe, said Barclays had a moral responsibility to comply with at least the spirit of the sanctions.

“It is reprehensible that Barclays is still prepared to offer [the two ministers] bank accounts . . . [the bank is] using intricacies of incorporation overseas as a means of sanction-busting in order to service Mugabe’s brutal henchmen,” she said.

Zimbabwe’s human rights abuses have made it a pariah state and the 84-year-old Mugabe’s attempts to maintain his 28-year grip on power have drawn international criticism.

In the run-up to the election, Mugabe’s Zanu-PF party is alleged to have carried out attacks that left more than 80 political opponents dead and caused Morgan Tsvangirai, the rival presidential candidate, to withdraw.

The EU sanctions were first imposed when Mugabe attempted to rig his 2002 presidential campaign. A blacklist was produced naming senior politicians whose funds – such as “deposits with financial institutions” – were to be frozen. The sanctions make clear: “No funds or economic resources shall be made available, directly or indirectly, to or for the benefit of [people on the blacklist].”

However, both Manyika and Goche – who have been on the list since 2002 – told The Sunday Times they have held accounts with Barclays for some time. They could have used the bank to transfer funds out of the country, avoiding the hyperinflation that has made Zimbabwe’s currency almost worthless.

Both ministers have fearsome reputations. They are based in the country’s northeastern Mashonaland region, which has been the focal point of government violence since the first presidential poll on March 29.

Manyika is Zanu-PF’s national commissar directing Mugabe’s election campaign. The opposition Movement for Democratic Change (MDC) party claims Manyika told supporters at a rally in May to beat up opponents. The MDC says that, in addition to the deaths, 10,000 people have been injured and 200,000 have been displaced from their homes. Manyika is also understood to have instructed the police to turn a blind eye when opposition supporters were being attacked.

Manyika has been accused of orchestrating the burning-down of four opposition members’ houses. He was also implicated in the shooting of an opposition demonstrator during a rally outside Harare. Court documents revealed he had ordered a supporter to shoot into the crowd.

Goche is a former national security minister who ran Mugabe’s infamous Central Intelligence Organisation (CIO). He was heavily involved in the “land reform” policy that left thousands of white and black farmers without their livelihood.

At the height of the evictions in 2000, Goche was accused of being the planner of violent farm invasions by bands of so-called war veterans. He was also behind for a leaked CIO document, entitled Solution to the White Problem, which aimed to drive whites from Zimbabwe.

Earlier this month Goche announced that humanitarian agencies would be suspended from operating in the country – a ruinous development for many of the 4m people who depend on food aid. It was believed to be a ploy to enable Zanu-PF to control food supplies to hungry villagers ahead of the election.

Barclays, which faced criticism for operating in South Africa during the apartheid years, has remained one of only a handful of banks with extensive operations in Zimbabwe. It has been operating in Zimbabwe through a subsidiary company for almost a century and has recently been opening branches there.

Last November The Sunday Times revealed that the bank had contributed millions in loans to a scheme that was used by Mugabe to fund cronies given land seized from white farmers.

Internal Foreign Office and Treasury e-mails – acquired under freedom of information laws by Norman Lamb, the Liberal Democrat MP – show there was little enthusiasm for intervening against Barclays at that time.

Initially, officials drafted a statement saying they believed it “morally” wrong for Barclays to make farm loans to members of Mugabe’s regime but this line was quashed. The word “investigating” was also removed in case it might result in what an official described as a “whoops there go the money markets” incident.

In the end Treasury solicitors ruled that the Barclays subsidiary did not come under the EU sanctions scheme because it was incorporated in Zimbabwe.

On Friday Barclays issued a statement saying: “[Barclays] services are critically relied upon by many of the 135,000 customers for their day-to-day operations to maintain access to banking and employment, with a benefit to the wider community. This continued presence brings the benefit of avoiding additional hardship [to that] already being experienced within the country.”