:00:00. > :00:09.Now on BBC News, it's time for Hardtalk.
:00:10. > :00:23.Welcome to HARDtalk two with Zeinab Badawi. -- with. Finance Minister
:00:24. > :00:25.Patrick Chinamasa is the long-time cabinet minister and ally of
:00:26. > :00:27.President Robert Mugabe. Zimbabwe's economy is once again staring down
:00:28. > :00:29.at the abyss. Hospitals are running out of basic supplies, more than
:00:30. > :00:31.half the population is hungry and criticisms of the veteran President
:00:32. > :00:34.Mugabe are gathering pace. How will he sort out this mess that he
:00:35. > :01:01.himself must stand accused of helping create?
:01:02. > :01:16.Patrick Chinamasa, welcome to HARDtalk. Thank you. Thank you for
:01:17. > :01:22.the invitation. You were Justice Minister for 13 years. Three years
:01:23. > :01:29.ago you made Finance Minister. Frankly, you were handed a poisoned
:01:30. > :01:37.chalice, weren't you? Yeah. We found ourselves in difficulties. Who may
:01:38. > :01:47.know the result of Zimbabwe in a vacuum in the programme. The
:01:48. > :01:56.decolonisation issue to sort out the issues that caused the armed
:01:57. > :01:59.struggle. The reaction arose from the fact there was a secession of
:02:00. > :02:03.hostilities and the British government, during the time of
:02:04. > :02:09.Margaret Thatcher, wanted to make resources available. Let me make
:02:10. > :02:15.this clear. You say the present problems, which I will talk about
:02:16. > :02:30.with you, our role because of the British? -- are all. Nothing because
:02:31. > :02:35.of ZANU-PF? Nothing without? As you know, Zimbabwe, up until the
:02:36. > :02:39.sanctions, was able to meet its international obligations. We had a
:02:40. > :02:44.functioning economy. But that was undermined by the sanctions which
:02:45. > :02:51.crippled our capacity to honour international obligations. We got
:02:52. > :02:56.into this. The exercise right now is to try to get us out of the hole
:02:57. > :03:02.which we were put into 16 years ago. OK. You brought up the issue of
:03:03. > :03:08.land. We have real food shortages now in Zimbabwe where the United
:03:09. > :03:20.Nations, UNICEF, they see that 37% of households in Zimbabwe go hungry.
:03:21. > :03:28.-- say. That is not true that we are going hungry. You want to argue with
:03:29. > :03:35.the United Nations? To make sure every person stays full, we are
:03:36. > :03:42.importing food and distribution has been going well. Can I just say...
:03:43. > :03:49.They are not going hungry. The system of distribution works.
:03:50. > :03:54.UNICEF's director said in March this year we have not seen these levels
:03:55. > :03:59.of malnutrition in more than 15 years. The United Nations is
:04:00. > :04:10.appealing for help. But, OK, you say no one is, the United Nations says
:04:11. > :04:17.otherwise... As I am telling you, as I speak to you, we are putting
:04:18. > :04:21.food... 70% of your food is imported. Agricultural output this
:04:22. > :04:28.year has been much more than we expected. And we are buying and
:04:29. > :04:35.distributing it. You import 70% of your food needs. Yeah. When you look
:04:36. > :04:38.at how rich Zimbabwe could be. You brought up this issue of farming and
:04:39. > :04:46.land and you blame it on the former British colonial power, but 4.3
:04:47. > :04:51.million hectares of arable land exists in Zimbabwe but only 2
:04:52. > :04:56.million was cultivated in the last season. Not because of the climatic
:04:57. > :05:00.shocks South Africa has gone through, natural problems, but
:05:01. > :05:04.because of the woeful lack of investment by your government over
:05:05. > :05:09.many decades. Like a mentioned, everything can be traced back to the
:05:10. > :05:19.stand-off with those countries which imposed sanctions on Zimbabwe. It
:05:20. > :05:25.undermines our culture. Clearly, I admit, it could be unproductive due
:05:26. > :05:31.to lack of farming because of lack of funding. These are issues we are
:05:32. > :05:36.seeking to resolve. We need to resolve those issues especially to
:05:37. > :05:43.do with accommodation. You accept state support to the agriculture so
:05:44. > :05:47.has been inadequate. -- sector. I admit that. I want you to understand
:05:48. > :05:56.the origin of that problem. The origin of that problem. OK. The
:05:57. > :06:01.Zimbabwe Farmers Union says the country needs 2 billion US dollars a
:06:02. > :06:08.year to revive the farming sector. I would put it at more than that. What
:06:09. > :06:11.is your projected spending for 2016? It has been inadequate. I can tell
:06:12. > :06:17.you the figure, minister. 1.5 million when you need 2 billion.
:06:18. > :06:23.Like I told you, there is no access to funding. It is a fraction. Yeah.
:06:24. > :06:28.There is no access to funding for agriculture. That is the major
:06:29. > :06:33.problem. The lack of funding is a rising from the stand-off between us
:06:34. > :06:41.and the traditional partners. -- arising. But you have $15 billion of
:06:42. > :06:48.revenue from the diamond industry in Zimbabwe which your president
:06:49. > :06:54.himself, Robert Mugabe, said in March had been looted and simply
:06:55. > :06:58.disappeared. I admit... There is money stability is potential in our
:06:59. > :07:02.economy, there is no doubt about that. But you aren't right to try to
:07:03. > :07:08.ascribe it to bad management. It hasn't been. The land issue was a
:07:09. > :07:15.revolution in itself. I have moved on from that. I wasn't
:07:16. > :07:19.criticising... The way we were heading with the economy... I wasn't
:07:20. > :07:23.criticising... Let me come back to the 15 billion. What we are saying
:07:24. > :07:33.is, over the years, there has been an economic loss arising from
:07:34. > :07:40.mispricing. To put it differently... OK... It is mispricing. The problem
:07:41. > :07:45.that we know happens in all developing countries. The mispricing
:07:46. > :07:50.of commodities over a period of time. Yeah, you can also put it to
:07:51. > :07:55.the effect that in that case we were caught sleeping. But the truth of
:07:56. > :08:04.the matter is that it is coming from mispricing. It is an issue now
:08:05. > :08:09.without we are interrogating. -- now that we are. We started this bit
:08:10. > :08:13.here with you saying that you don't have the money to put the investment
:08:14. > :08:18.into the farming sector that you say you would like to give. It is just a
:08:19. > :08:22.fraction. I said there is money but the suggestion is it isn't going to
:08:23. > :08:28.the right places. Zimbabwe is the world's eighth biggest diamond
:08:29. > :08:31.producer. There is a lot of money that could develop just from that
:08:32. > :08:37.industry alone. As Global Witness themselves say. We are looking at
:08:38. > :08:42.that sector. I am sure you are aware that we have descended on the
:08:43. > :08:47.downward sector to restructure it and consolidate the companies.
:08:48. > :08:52.Companies that were operating in that sector. It has become difficult
:08:53. > :08:57.to carry an oversight over all those companies. OK... We acknowledge that
:08:58. > :09:03.there has been a mistake. Who is looting this money? It was a
:09:04. > :09:09.Zimbabwean toolmaker and columnist quoted on the BBC website says no
:09:10. > :09:17.enquiry and no arrests, just a $15 billion hole in the nation's offers.
:09:18. > :09:24.It is an economic loss that we have suffered. Not just in diamonds, but
:09:25. > :09:28.also across the wider spectrum. -- across. That is to do with the
:09:29. > :09:34.invoicing of raw materials and imports. It is a matter that we are
:09:35. > :09:39.interrogating with a view to coming up with the necessary systems to
:09:40. > :09:46.prevent that coming up again. Wait a minute. The mining and mayoral
:09:47. > :09:50.sector needs to be watched to make sure systems are put in place. --
:09:51. > :09:55.mineral. I will give you an idea of who is doing the looting of the
:09:56. > :10:04.diamond wealth of Zimbabwe. Global Witness, a prominent group, they say
:10:05. > :10:06.that revenues from the diamonds are mined and marketed outside
:10:07. > :10:14.government control and that is propping up Robert Mugabe's
:10:15. > :10:23.oppressive regime. That is not true. OK. The point is, I want to
:10:24. > :10:32.emphasise the point, it is an economic loss arising from
:10:33. > :10:36.mispricing. We are going to, not just for that sector... The
:10:37. > :10:43.government will have to make sure that Zimbabwe has more than a 50%
:10:44. > :10:48.stake in each of these companies? In the sector we have started with a
:10:49. > :11:00.consolidated company right now owned by the government. That won't happen
:11:01. > :11:06.in the future, theft? Already, what has already been done with
:11:07. > :11:10.transparency, we are now able to get, on a daily basis, production
:11:11. > :11:15.figures which we did not used to get in the past. You have a huge
:11:16. > :11:20.challenge. I started saying you have a poisoned chalice. We talked about
:11:21. > :11:28.food, a basic need of course. Of cost. Another is healthcare. The
:11:29. > :11:34.state of your bottles. Ghastly. -- hospitals. Out of date. No
:11:35. > :11:41.painkillers. Yes. As long as we admit the Genesis of the problem.
:11:42. > :11:46.When sanctions were imposed we no longer became a functioning economy
:11:47. > :11:55.overnight. The medical sector collapsed. The sanctions weren't
:11:56. > :12:06.there from day one in Zimbabwe. From 2000. Exactly. Not from 1986 the
:12:07. > :12:14.pillow yes. -- 1986. The sector was in good condition. So was the
:12:15. > :12:18.agriculture sector. You are not understanding the challenges. We
:12:19. > :12:26.have remained in pole position with respect to all those things. 1980.
:12:27. > :12:34.Look at life expectancy. 59 .5 years. It is now 57. 57.5. The
:12:35. > :12:41.sanctions are not... You can't just blame sanctions. That is part of a
:12:42. > :12:46.small number of the population. The wider population. If you are talking
:12:47. > :12:52.about those life expectancy is, they are to do with a smaller population.
:12:53. > :12:56.-- expectancies. Since independence we have expanded education and
:12:57. > :13:01.healthcare. And I think we should be given credit for that. But...
:13:02. > :13:14.Something that was not there before Independence. Only President
:13:15. > :13:17.Mugabe's government is able to undertake a look at the entire
:13:18. > :13:21.population. We have just talked about the hospitals. Some of
:13:22. > :13:30.Zimbabwe's major public hospitals are so poor they cannot even provide
:13:31. > :13:34.basic painkillers. Six cases of typhoid have been confirmed with
:13:35. > :13:40.more expected to emerge in. You might have a typhoid outbreak.
:13:41. > :13:48.UART... You are going on the negative. I am not. There are good
:13:49. > :13:54.success stories. The effect that after this pounding we have remained
:13:55. > :13:58.resilient and are able to have any help system still worth talking
:13:59. > :14:04.about is good credit for us. It is just that you are not appreciating
:14:05. > :14:13.that. These are not my words, can I tell you who it is? The health and
:14:14. > :14:15.childcare minister. He said the ministry concerns is that the
:14:16. > :14:21.government should do something urgently about is dumb at this. You
:14:22. > :14:28.are being asked to sort out this mess. -- about this. I explained to
:14:29. > :14:36.my colleagues and whoever bothers to listen. We are coming from a very
:14:37. > :14:43.bad situation. It is eight poisoned chalice, as you said. --A. You
:14:44. > :14:47.rightly pointed out. To come out of that situation will take time. It is
:14:48. > :14:51.a process. Above all, we need to have an economy that is performing
:14:52. > :14:56.so that we can address all those issues that challenge us.
:14:57. > :15:03.But people are now openly criticising the government. Even
:15:04. > :15:08.Robert Mugabe himself, the Zimbabwean broadcasting organisation
:15:09. > :15:11.put out a report blaming the government for the latest drug
:15:12. > :15:15.shortages, and the state broadcaster is rarely critical of the ruling
:15:16. > :15:19.party. What they are now saying, and it is not just the state
:15:20. > :15:25.broadcaster. You've got young people inside and outside Zimbabwean saying
:15:26. > :15:27.enough is enough. You know, the authorities are being openly
:15:28. > :15:31.criticised, even as I said one of your colleagues are saying something
:15:32. > :15:36.has got to be done about this woeful state of affairs. Yes, something
:15:37. > :15:43.which we have now crafted a path out of all of those challenges. But it
:15:44. > :15:46.is, -- has to be understood it a process, and not an event. We need
:15:47. > :15:52.to get all the factors together to make the economy grow again, which
:15:53. > :15:55.it is not. Yes, but when people look at that... I have to say this,
:15:56. > :16:00.really, the President's daughter gives birth recently in Singapore,
:16:01. > :16:05.and we have discussed how about the hospitals are, maternity health and
:16:06. > :16:08.particular is awful, and they see the President's daughter getting off
:16:09. > :16:13.to give birth somewhere else. What do you think most Zimbabweans would
:16:14. > :16:19.think of that? No, I think I have already said. But what do you think
:16:20. > :16:23.of that particular example? We accept that the health situation is
:16:24. > :16:27.not where it should be. And if you have got money, as she clearly
:16:28. > :16:38.has... And we are working very hard to improve the situation. You don't
:16:39. > :16:43.want to comment on... It is not a it is not an event, it is a process.
:16:44. > :16:46.But you are not going to comment on the fact that Zimbabweans might get
:16:47. > :16:49.fed up when they see that the hospitals are unable to treat the
:16:50. > :16:52.sick. What is your opinion of the President's daughter going abroad?
:16:53. > :16:57.We should give a situation where we can, by all means, make sure that
:16:58. > :17:03.most Zimbabweans are treated at home and not outside. So the situation
:17:04. > :17:09.where some Zimbabweans feel that they should go outside the country,
:17:10. > :17:13.clearly, it needs attention. And that is precisely what we are
:17:14. > :17:16.saying. We need are performing a economy in order to make that
:17:17. > :17:22.happen. You are trying to now open up new credit lines with the IMF and
:17:23. > :17:27.the World Bank. Sure. You want to pay off the arrears not on the
:17:28. > :17:33.principal loan but so you can get some money to prop up your economy.
:17:34. > :17:36.What it is a bit ironic, isn't it, now, that the Zimbabwean government
:17:37. > :17:40.is trying to get help from the very same institutions of whom a large
:17:41. > :17:44.number of their members are the very people you have blame for getting
:17:45. > :17:48.you in this mess. No, please get this clear. We are a shareholder in
:17:49. > :17:52.the World Bank. We are a shareholder in the African development bank. We
:17:53. > :17:57.are a shareholder in the IMF. The ones that call the shots countries
:17:58. > :18:01.you criticise. For your information, even with the African development
:18:02. > :18:06.bank, we are the largest shareholders in Africa. What about
:18:07. > :18:10.the IMF and World Bank? Yes, all we are doing with the engagement is
:18:11. > :18:18.trying to enjoy the benefits of our ownership, access to credit. And if
:18:19. > :18:22.it turns out that we cannot enjoy those benefits until we create our
:18:23. > :18:25.arrears. So the engagement is about clearing our readers so we can enjoy
:18:26. > :18:31.the benefits of our membership. And we are not embarrassed by that. OK,
:18:32. > :18:35.so you are going to hope. Have you had a good reception? Yes, we have
:18:36. > :18:39.had a very good engagement. In the engagement is not an overnight one.
:18:40. > :18:46.We studied almost when I came in as Minister for Finance. It had just
:18:47. > :18:49.started. We been waiting on this programme, and we have been meeting
:18:50. > :18:56.our targets. Quantitative and social targets. Last targets we met, were
:18:57. > :19:01.December last year, the IMF is reasonably happy with the way we
:19:02. > :19:07.have been running the economy. All right, but confidence is very, very
:19:08. > :19:11.low. Sure. We know you started using the US dollar in 2009 when your own
:19:12. > :19:15.currency was destroyed by hyperinflation. And now we see long
:19:16. > :19:21.queues formed by depositors at the banks in Zimbabwe, seeking their
:19:22. > :19:25.money because there are worries about cash shortages, and you want
:19:26. > :19:30.to bring in one new measure aimed at halting the flow of US dollars from
:19:31. > :19:34.Zimbabwean called Bond notes, which would act as a kind of cash
:19:35. > :19:37.substitute, only in Zimbabwe, they wouldn't have any value outside the
:19:38. > :19:43.country. And this is increasing anxiety for your country. No, at Uni
:19:44. > :19:47.began to understand a unique situation. We are one of three
:19:48. > :19:52.countries in the world which don't have their own currency. Which means
:19:53. > :19:57.that we don't have a policy tool to address any shocks that happen,
:19:58. > :20:04.whether they are external shocks or internal shocks. But worse for us is
:20:05. > :20:10.that we use the US dollar for financing domestic transactions,
:20:11. > :20:14.whatever they may be. And we use the US dollar for paying mortgages, no
:20:15. > :20:18.other country has ever done that, for buying stocks on the market, we
:20:19. > :20:23.use the US dollar. And our difficulty arose when the US dollar
:20:24. > :20:29.started to appreciate. I understand the reasons, but it is causing
:20:30. > :20:36.anxiety. Yes, we know, but when people are faced with change, and we
:20:37. > :20:38.needed to change. And there is no person right now internally or
:20:39. > :20:48.externally who can say that the usage of the US dollar for domestic
:20:49. > :20:58.financing is at a solution. And it is through the back door, is it? It
:20:59. > :21:02.is not. What is coming in is an export incentive. It is causing a
:21:03. > :21:08.lot of problems. I will just tell you, a shopkeeper north of Harare
:21:09. > :21:14.says it is a zombie money made from nothing. Exporters are not
:21:15. > :21:21.complaining because this is to benefit exporters, because our stock
:21:22. > :21:27.of value, US dollars, comes from exports. And we want to incentivise
:21:28. > :21:30.the exports. You want to issue bond notes. Bond notes will only be
:21:31. > :21:37.issued relative to the volume of exports. No exports, no issues of
:21:38. > :21:41.bond notes. And it is backed, by the way, by a 200 million US dollar
:21:42. > :21:48.facility from the African support bank. It can only come from
:21:49. > :21:54.people... You will have to calm the worries in your own country. The
:21:55. > :21:59.words I getting now is that they are too late in coming. OK, well, that
:22:00. > :22:02.is a view of some people but the Zimbabwean investment authority
:22:03. > :22:05.chairman says there is very little support at a recent meeting of
:22:06. > :22:09.delegates who said they are opposed to it. But you know, this economic
:22:10. > :22:13.uncertainty is backed by political uncertainty because your president
:22:14. > :22:19.is 92. With all respect to somebody his age, there is no succession
:22:20. > :22:26.plan. This country has the right to travel its own path in history. And
:22:27. > :22:33.in the case of our President, yes, he is 92, but you must also know the
:22:34. > :22:38.long path he has travelled, almost since 1958. So he has definite views
:22:39. > :22:47.about the destiny of Zimbabwean. And he remains in place to ensure that
:22:48. > :22:51.the trajectory he wants to set for Zimbabwe will be there even after he
:22:52. > :22:55.is gone. So... People are beginning to call out now that they think it
:22:56. > :22:58.is time for him to go in the country. They are beginning to say
:22:59. > :23:08.that. Good grace, his wife, I must ask, good grace, his wife, succeed
:23:09. > :23:12.him? She remains a very solid, political, formidable force in
:23:13. > :23:18.Zimbabwean and all the instability that you are talking about is not
:23:19. > :23:24.within... So it won't be Grace, who succeeds him, because she got a
:23:25. > :23:28.Ph.D. In five months. Please, do not use the platform to insult her. She
:23:29. > :23:32.is not a subject for discussion. We are talking about the age of our
:23:33. > :23:38.President, and I am saying that as far as Zimbabweans are concerned, we
:23:39. > :23:44.are happy. And aspire as we are concerned, we are happy. And the
:23:45. > :23:51.President wants to leave this country on a trajectory in terms of
:23:52. > :23:54.values and trajectory, and as far as bubbly and are concerned, we are
:23:55. > :23:59.saying anyone who wants to talk on this, feel free. And if the
:24:00. > :24:03.population agrees with them, of course. It means the result will be
:24:04. > :24:10.otherwise. But we should not be dictated to when we choose our
:24:11. > :24:13.leader. The Finance Minister of Zimbabwe, Patrick Chinamasa, thank
:24:14. > :24:34.you very much for coming on HARDtalk. Thank you. Thank you.
:24:35. > :24:39.Your impression of Monday's weather will have been dictated by just how
:24:40. > :24:42.close you were to an area of low pressure, this area of cloud,
:24:43. > :24:47.which brought a fair amount of rain to some parts of the British Isles,
:24:48. > :24:50.Lull in proceedings for Tuesday, then Wednesday and Thursday sees