A fine red wine blend
Marianne bought the bottle of South African Saronsberg Seismic 2009 red wine about 3 years ago; she had fond memories of it and thought it would be a good wine to put aside for a major celebration. The first occasion we earmarked was Mugabe’s death but when it came it seemed a bit of an anti-climax. He’d become irrelevant and it certainly didn’t create a beacon of hope. The current Zimbabwean president, ED Mnangagwa has seen to extinguishing that one before it could get going. So we moved the goalposts to the day when we would have paid off the bond on the house.
We decided to buy a house in 2016. Like anyone who’s ever rented a house long term you soon realize that you are just putting a lot of money into someone else’s pocket. There were other reasons to invest in a house. In Zimbabwe there is little if any sense in putting money into a savings account. If the government doesn’t steal it, inflation will make it worthless. Banking on the local currency crashing yet again, we decided to pool our hard-earned foreign currency savings, borrow as much as we possibly could, and buy a house. After 6 months of despondent searching we settled with a house with “potential” (a real estate euphemism for needing a lot of work) and moved into town from the farm where I’d been renting.
The asking price was US$225,000 which we considered fair as the house was filthy and needed a lot of work but had a decent 2 bed-roomed cottage on the property that we reckoned we could easily rent out and help pay off the bond. We could also move into it when a bit older and rent out the main house for retirement income. We could only get a bond for $75,000 of the asking price as both of us were over 50 and we had to pay it off over 10 years. It sounds like a lot but I was banking on the currency losing it’s value as it had in 2008 when people had paid off multi-thousand dollar bonds for the equivalent of a few US cents. I was determined not to lose out again as prior to the 2008 currency crash I’d dithered about buying a house and lost out on a bargain.
Luckily the loan contract stated that the money was valued as US dollars or the dominant local currency of the day. At the time there were a number of legal currencies in Zimbabwe including the US dollar, South African rand, British pound and the local currency called the RTGS dollar if it was in electronic format or the Bond dollar if in cash notes. The latter were officially valued at 1:1 with the US dollar but very quickly started to trade at much less on the black market. Although the bank accounts were officially valued in US dollars it was soon evident that they were valued in local dollars (the reserve bank had made off with the US dollars) and nowhere near 1:1. From the point of view of paying off the house, that suited us just fine and in September I borrowed $14,000 of local money off my own company (it was about US$1,000 at the time) and paid off the bond. Somehow it didn’t feel sufficient enough of an achievement to open the bottle of wine. So we set the new goal as my 60th birthday.
I wouldn’t say that the 10 years since I posted Reflections on the first half have passed quickly but they have been eventful. In December 2016 I married Marianne, whom I met through friends who boarded my dogs whilst I was undergoing neck surgery to stop the rot caused by 2 previous surgeries that had gone badly. We moved in together some time later and I bought her a dog to help with the bonding process. It must have worked as we celebrated our third anniversary recently.
I also bought a new pickup. That’s probably not a big deal to many people who read this but it is the first new car I have ever bought and it was a necessity. My disability had been deteriorating noticeably and on at least 2 occasions I’d missed the brake in my old Mazda pickup. I’d recovered the situation without more than damaged nerves but at some stage there were going to be tears and dents. As a physically disabled person I can import a vehicle duty free with the proviso that it is automatic and of course I had to get a letter from a medical specialist stating the nature of my disability and that I needed an automatic vehicle (some vehicles are assembled in Zimbabwe but they are all manual). I chose to go through a private importer (rather than an official Ford dealer) as they were familiar with the system. Money was paid and after a considerable delay the vehicle arrived, complete with a hand-operated foot brake to ease the drama of stopping. It certainly is a pleasure to drive though not hugely economic on fuel use.
My brother, Duncan, came out from the UK to help celebrate my 60th birthday in the middle of November. Unfortunately my sister, who lives in the north-western USA, couldn’t make it but gave me a present of 3 nights in a cottage in Nyanga in the eastern highlands of Zimbabwe. We gathered some friends, filled up some containers with diesel (it’s still critically short) and headed off for the 4 hour drive. Whilst stopped at a traffic light in the dormitory town of Ruwa some 20km out of Harare we were enveloped by a cloud of blue smoke. By the time Duncan got out to check it had dispersed but it was definitely ours. The truck computer didn’t indicate any faults but we stopped at the next town and changed the fuel filter, which was dirty. The power loss didn’t improve so in the absence of any warning lights on the dashboard we continued to Nyanga.
The cottage, named Rocky Glen, was at the end of a road in a tree plantation. It was very comfortably furnished and the staff ensured that the log fire burned all day and most of the night which irked a bit as it was not remotely cold. It did add atmosphere for the Saronsberg wine which was very good. Nope, there’s no more 2009 vintage – I have checked their website!
In good Nyanga form it rained, though not so heavily that we couldn’t get out and do things which can be an issue in the rainy season. The road to the Gairezi River was surprisingly good, not least because it has been very dry in that part of the country too. The river was low and dirty from the overnight rain but Duncan was not put off and had a ritual swim. The rest of us watched as the clouds closed in and the rain started.
World’s View. L to R: Marianne, Maria Wilson, Duncan, self, Zak
The next day it was time to leave the quiet and solitude of the Nyanga mountains and head back to Harare and stress. First stop was the turbocharger repair workshop.
The news wasn’t good; a new turbocharger was required from South Africa and the currency was US dollars cash, and no paper trail. Whilst such deals are illegal in Zimbabwe one has to accept that for fully imported one-off items foreign currency will be required. I didn’t really have a choice as it was not a good idea to drive the vehicle and I cannot safely drive manual vehicles. A deposit was paid with precious dollars and in due course the vehicle was fixed after parting with yet more. As of writing this it hasn’t been ascertained what caused the turbocharger to fail but this particular engine is prone to having the turbo fail. Thanks Ford.
Fortunately there had been some rain whilst we were away so the swimming pool (also a makeshift reservoir for rain water collected off the roof) had risen a bit. The borehole has been failing since October and finally became useful only for drinking water in early November so the pool has been tapped for non-drinking water. Finally last Friday we had to buy in water as the pool was very low and the remaining water was more than somewhat dirty. Then the following day the rains returned and we’ve had a good week of some 140mm. The pool is back to two thirds full (about 40,000 litres) and we have 2 rain tanks totaling another 10,000 litres. We are self-sufficient for a while. Municipal water supply is erratic in Harare. We have not had municipal water since we moved in and those that do have it say it’s unusable for anything but watering plants. Lake Chivero, Harare’s main water source, is heavily polluted and the municipality has no money for water purification chemicals.
The Zimbabwe government doesn’t have much money for anything which is not surprising considering they stuff their pockets with whatever money they can lay their hands on. There has been a long running junior doctors strike that culminated in more than 400 being fired. They complained that they didn’t even get paid enough money to get to work and when they did get to work there was little if anything to work with. Those that can have left for other countries and the government has backed down and offered to reinstate the dismissed doctors no questions asked. A very wealthy Zimbabwean businessman living in South Africa has offered to top up the doctors’ salaries with the local equivalent of US$310 per month but it’s not clear how many takers there have been.
It’s not just the healthcare system in a shambles. Air traffic controllers have also been on strike over poor pay conditions and unsafe equipment. Power supplies are still heavily restricted countrywide. The latter has got to the stage where the government is reportedly considering the nuclear power option. That they are extremely complex to run doesn’t seem to bother them in the slightest – much more challenging than supplying a country with fuel at which they have proved themselves utterly incompetent. Hopefully the cost will keep an African Chernobyl at bay. In the meantime the national supply authority, ZESA, has hedged it’s bets and installed a solar power system in its head office building. Oh the irony.
So what’s it like being 60? Much the same as 59. I did get a set of hearing aids from my brother, courtesy of the National Health Service in the UK. His hearing profile is much the same as mine, though mine is a bit worse thanks to a more extended military service. He just has to pay £50 a piece to replace his “lost” ones. Do they work? Yes. I can now hear the workings of my electric toothbrush but they haven’t cured the persistent tinnitus as I hoped they might. I might be able to get them reprogrammed here but otherwise they will just have to do.
Bette Davis is credited with saying “Getting old is not for sissies”. I know 60 is the new 40 and all that but I think we need a different standard for Zimbabwe. Life here is just difficult regardless of age and of course makes one feel older. Some days I feel like I’m well into my eighth decade (I don’t like to think I’m already into my 7th). Partly it’s a structural issue – an artificial knee is giving a lot of trouble these days and it’s not helped by less than successful neck surgery in 2010 that has exacerbated my disability. Mostly it’s the dismal state of the economy which even our government has said will shrink by around 6% in 2020. The Economist, in its annual predicting the coming year supplement, has predicted it will shrink by around 23%. How can one make any plans in this sort of environment?
I asked Marianne recently if she would opt to stay in this country if we were financially secure. She said probably. I said I would seriously at moving to where I could do the things I really want to namely paragliding. I am now dependent on other people to take off – a critical part of the sport – and there’s only a few people I’d trust to do that. In fact there are about 2 and neither of them are available. One has stopped flying and the other is not interested in helping out – I am seen as baggage. Quite often there is just nobody around interested in going flying anyway – such is the dire state of the sport. France would be good, paragliding is big there and there would always be people around to help and yes, I can get by with the language. Dreams.
Most people at 60 have a retirement plan laid out. No chance of that in Zimbabwe for most people. There is a national pension scheme but the pensions don’t remotely keep pace with inflation so we are putting as much money as we can into improving the property in the hope that one day we can sell it for real money. So here we stay.
Zimbabwe Absurdity 
Taxed if you do, taxed if you don’t
26 08 2023It had to be a mistake, I couldn’t possibly owe the tax department (ZIMRA – Zimbabwe Revenue Authority) that amount. Even if I converted it to US dollars it would amount to an impossible figure – about 17,500 at the unofficial rate and 23,000 at the bank rate. I checked the email address – it was from a person with whom I’ve corresponded over the years. Then there was the wording; FINAL DEMAND. Where were the other demands? I did what any sensible person would have done and contacted my bookkeeper in a state of panic.
Alison was more than a bit puzzled but told me she couldn’t do anything without seeing how they’d got the figures. “Your are entitled to see what’s going on” she said. “Ask them for the ledger”
The ledger was duly sent and the waters immediately became a lot murkier. It stated the figures were in US dollars and the numbers, if the currency was US dollars, were impossible. I sent it on to Alison. It was a while before she came back to me by which time my imagination had run riot. What if I really did owe 105 million dollars? I would have to buy it on the open market with my US dollars and would be left with no operating capital and nothing with which to pay wages. The company would be unlikely to survive.
Alison assured me that the figures on the ledger were Zimbabwe dollars and I probably did owe the 3,835,807 listed. She had no idea where the 105 million came from. “Ask them” she said. So I did.
The reply was abrupt; the 105 million was to be ignored (RTGS is another way of saying Zimbabwe dollars). The amount on the ledger was also incorrect as it didn’t account for some US$550 that I’d paid in presumptive tax (they are called Quarterly Payment Due or just QPD) which would have reduced the amount owed close to zero.
I speculated to Marianne that it was all just a bit of psychological bullying to get me to pay attention to the outstanding amount, then two days ago I bumped into Gary whose wife had had a strikingly similar experience.
Gary works for a seed company that occasionally uses my nursery to grow seedlings for various trials. They have a trial on ART Farm which is a neighbour to my nursery and I sometimes use it access my nursery so as to avoid the appalling direct road and take in a bit of soothing farm scenery on the way. Gary was having a look at one of their trials near the road so I stopped to chat.
We discussed various things then I related my experience with the tax authority. He said that Clare, his wife who works as a bookkeeper for a local church, had received a final letter of demand for payment from ZIMRA for an impossible amount about three months ago. She replied that as a church they were not liable for tax and any money made was given away to various charities and nothing more was heard. He agreed with me that as the government was desperate for money it was likely endorsing ZIMRA’s intimidation tactics to get in whatever money they could, maybe they were even giving a commission.
On getting to work I related the story to my senior foremen. They were decidedly cynical. “They are all on the take” opined Chingedzerai. “Yes”, added Fabian, “they see the rest of the government officials stealing and think that they should have some of the pie too. They see what they can bully you into paying and then split the extra between themselves”. It was obvious that they thought I was being naïve.
Marianne had been doing some questioning of her own and posted my problem on the local community WhatsApp group. Someone had responded with a name and phone number of a senior official at ZIMRA whom he thought would be able to help. I gave him a call and related my problem and asked if it was official ZIMRA policy to send out threatening demands based on nothing much at all. His indifference was striking; I should send him a copy of all the correspondence and documents and he’d forward it to the relevant manager. I duly sent him the copies but I am not expecting a reply.
It’s no secret that Zimbabwe is in deep financial trouble. Mismanagement, corruption and incompetence have seen our GDP plunge after the Mnangagwa government took power in a coup back in 2017.
At the time it was welcomed by the majority of the population who were relieved to be rid of the much hated and feared Mugabe regime but it was not long before the new government of E D Mnangagwa revealed its true colours of repression and corruption. Chingedzerai reminded me that the current administration has never bothered to investigate the estimated US$15 billion worth of diamonds that went unaccounted for from the Chiadzwa diamond fields in the east of the country in the latter part of the Mugabe era. More recently there was the gold smuggling exposé by al Jazeera that showed how top Zimbabwean officials were, with the highest approval, smuggling gold out of Zimbabwe and laundering the resulting cash. Indeed, for a country that is struggling financially, there is an eye-opening amount of property development around town. In the past this would have attracted the attention of ZIMRA who would have demanded to see the accounts of owners of expensive properties and made to account for the development. Now it’s easier, and more personally profitable, to send out threatening letters.
I paid wages on Tuesday. We chose the date years ago when getting cash from the bank at the end of the month meant enduring long queues and not getting the desired breakdown. Chingedzerai had heard the income tax limits had been increased and asked me to check on the internet before he entered the attendance and overtime figures on the computer. I was fairly sure it was only the Zimbabwe dollar tables that had changed but checked on the US dollar tables anyway (I have been paying my staff in the latter currency since August last year).
In Zimbabwe salaries are taxed monthly and the system is known by its acronym PAYE; Pay As You Earn. The rates are iniquitous. Wages are taxed from US$100 per month upwards! Given that the minimum agricultural wage starts at US$60 before any of the required allowances, most of my staff are taxed. Some do get age exemptions but the rest of them have to endure.
Such is the government’s demand for money that it has taken to taxing money transfers at 2% per transfer. It goes without saying that most transactions are cash though it’s not always possible. The government used to tax cash withdrawals from banks but gave up when it became evident that people were simply not depositing cash in order to avoid paying the tax.
Given the high cost of living and taxation in Zimbabwe one would assume that the majority of the population would be keen for a change of government. Indeed, given that we had a general and presidential election on Wednesday, one could be forgiven for thinking it imminent. With the recent exception of Zambia, southern African is not known for changing its governments and Zimbabwe is not about to become an exception too.
My foremen and I were all in agreement on this; the incumbent ZANU-PF party, which has maintained its grip on power since 1980 by means mostly foul, will certainly cheat its way to victory; only the level of the fiddle is not known. So far it’s been “limited” to delaying delivering voting papers to polling stations in regions known to be opposition strongholds, sending voters to polling stations where they found they weren’t registered, making sure one couldn’t check the online registration database and of course blatant intimidation. Few, if any, believe the logistical problems to be anything but deliberate. We remain cynical.
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Tags: corruption, general election, tax, ZIMRA
Categories : Blogroll, Economics, Social commentary