COLUMNBy Carmel Rickard

While South Africans were enjoying the 1 May Workers’ Day public holiday, something extraordinary was unfolding in Port Elizabeth.

Something with far-reaching implications for international human rights and for international trade, a novel legal situation highlighting the plight of a little-remembered, embryonic state – Africa’s last colony, the Western Sahara.

Early that morning, the ship, N M Cherry Blossom, arrived at Coega, the specialised port on the outskirts of Port Elizabeth, to take on fuel.

Its cargo was phosphate worth about US$6m, bound for New Zealand. That much was clear. But just who owned the cargo is a much tougher question and one that the courts here have been asked to resolve.

The night before the Cherry Blossom arrived, the Saharawi Arab Democratic Republic (SADR) and the Polisario Front had brought an application before Judge Elna Revelas. They asked for a temporary order to keep the ship’s cargo in the area of the court’s jurisdiction and for the sheriff to attach the cargo pending the outcome of their action.

She granted the temporary order, subject to a confirmatory affidavit being filed once it arrived in South African territorial waters, and set 18 May for a full hearing on the disputed order. Through the night, as the Cherry Blossom closed in on the crucial 12 nautical mile zone off the South African coast, Polisario members all round the world, along with their lawyers in South Africa, were all watching its progress on their computers.

Once the ship arrived, it was a comparatively simple matter to serve the order. But come 18 May, when the question of confirming the order was argued, a specially constituted full Bench of the High Court presided, given ‘the novelty of the matter and the complexity of the international law issues’ involved.

Last Thursday those three judges delivered their decision: they approved the order that the sheriff attach and hold the cargo in Port Elizabeth and remove the ship’s registration documents and trading certificates.

However, the order provides that, if appropriate security is put up, the cargo would be allowed to continue its journey.

Now the SADR and Polisario have a month to issue summons for the return of the cargo, failing which the order lapses. Once summons has been issued, the dispute is likely to feature on the court rolls in South Africa for years ahead, with possible applications and appeals even before the hearing about ownership of the cargo.

There is no dispute that the phosphate comes from the Boucraa mine in the northern part of Western Sahara. That mine is operated by Phosboucraa, a Moroccan company and a wholly owned subsidiary of OCP, another Moroccan company, the largest exporter of phosphate rock and phosphoric acid, and producer of fertiliser extracts, in the world.

But why is a Moroccan company mining phosphate in Western Sahara, its southern neighbour? Because Morocco claims the area as its own. And that is where the issue of Africa’s last colony comes in.

From 1884, during the height of African colonisation and for nearly a century, this was known as Spanish Sahara. Polisario was formed to liberate the country and represent its people. In 1976 Spain eventually pulled out, but not before offering its former colony – not to its own people, but to neighbouring Morocco and Mauritania. In the meantime, however, the Polisario had claimed the Saharawi Arab Democratic Republic as a sovereign state.

Although Mauritania has since abandoned its claim, Morocco holds much of the area in a military grip. Anticipating by decades US President Donald Trump’s idea of a security ‘wall’, Morocco has built a rock and sand barrier three metres high and 2 700 km long across the desert. Some 80% of the country is on the western side of this berm, ‘occupied’ by Morocco. For additional security this part is controlled by 120 000 Moroccan troops, while literally millions of landmines are embedded in the sand around the length of the berm itself.

The question of the status of Western Sahara has proved intractable, with the United Nations so far unable to reach any finality. Key members of the Security Council have strong bonds with Morocco and appear reluctant to back self-determination for the region against the wish of their ally.

If this sounds familiar, you may be remembering pre-independence Namibia. After the Germans quit their former colony, it was ‘colonised’ by its neighbour, South Africa, and for a long time that neighbour-coloniser tried to hold on in the face of world disapproval.

Instead of a berm, however, South Africa waged a more conventional war to maintain its hold. Just as the war in Namibia was complicated by international politics and the cold war in particular, so is the situation in Western Sahara complicated by international terrorism with a number of security reports warning that disaffected refugees from Western Sahara are easy prey for extremists.

Seen against this background the phosphate cargo becomes almost a symbol. It was mined by a Moroccan company, operating in land that Polisario describes as unlawfully ‘occupied’ by Morocco. Polisario says the area’s mineral wealth belongs to the SADR, not Morocco, and money from the sale of the phosphate belongs to the people of the land where it was mined.

That question – to whom does the phosphate belong? – is what the court has now agreed to consider. If to Western Sahara, then the mining company would have to relinquish the cargo. No one has suggested the phosphate belongs to Morocco. Perhaps the best alternative candidates might be the New Zealand company that has bought the fertiliser and that is stressing about the delay in arrival. But reports in the New Zealand media quote the buyers there, Balance Agri-Nutrients, as saying they have not yet paid for it and that the cargo still belongs to the mining company.

The fact that the full Bench decided South African courts could consider the dispute, and that the vessel must stay put pending that decision has infuriated OCP. It has declared its ‘outrage’, and ‘denounces’ and ‘contests’ the decision of the court which, in the view of the company, ‘has no jurisdiction to rule’ on the situation.

According to OCP, the court’s decision disregards established international law principles and the ongoing UN process, and ‘impedes international trade in South Africa’. The company also contrasts the Port Elizabeth decision to hear the case with a very similar case brought in Panama earlier this month, again by the SADR and Polisario, contesting ownership of a cargo. In that case, the judge declared the court had no jurisdiction to entertain the matter, a view that the company ‘commends and welcomes’.

Back in Port Elizabeth, however, the full Bench quoted key findings of the International Court of Justice: Morocco has no claim to sovereignty over Western Sahara; it acquired control of the area by force, contrary to customary international law. The natural resources of a territory may only be exploited on behalf of its people ‘if to do so will be for (their) benefit’. Yet OCP does not claim to have mined the phosphate ‘with the consent of the people’ of the territory, and ‘they do not and cannot claim to do so on behalf of its people’.

As to the criticism that the court should not agree to hear the case because it affects the legal rights of Morocco, the judges say that Morocco did not assert any right or interest in the cargo. It was not a party to the case. If a South African court found that the company’s exploitation of minerals was illegal this ‘can have no effect upon the legal rights of Morocco’.

It’s a fascinating judgment, important for the way it interprets the law and how it highlights a continuing international disgrace – the failure of both the UN (where Morocco is a member, but not Western Sahara) and continental bodies such as the African Union (of which both are members) to resolve the issue of the continent’s last colony. There are even suggestions that the case could play a significant role in resolving the dispute because of the pressure it might put on the parties – and other world players – to focus on ending the stalemate.

By Samuel Kamndaya

Dodoma — The government has advanced a proposal that seeks to ensure investors from East Africa and beyond as well as Tanzanians in diaspora are able to take part in the impending initial public offerings (IPOs).

Winding up the debate on the Sh31.7 trillion budget for the Financial Year 2017/18 in Parliament yesterday, the Finance and Planning Minister, Dr Philip Mpango informed the House that the government would amend the Electronic and Postal Communications Act (Epoca) 2010 with a view to allowing investors across the East African Community member states, Tanzanians in diaspora and foreign investors to take part in pending IPOs for telecommunications firms, including those for Airtel Tanzania and Tigo.

Going by Epoca 2010, telecommunication firms are required to offload 25 per cent of their shares for the public through the Dar es Salaam Stock Exchange (DSE).

In this regard, Vodacom Tanzania became the first telecommunications firm to issue an IPO early this year in which it sought to raise Sh476 billion by selling 560 million shares at Sh850 each.

With capital controls, however, the IPO was only open to local investors and so far, the company has been unable to reveal the IPO results, with pundits speculating that it might have underperformed due to a tight liquidity in the economy.

The Vodacom Tanzania PLC’s IPO ended on May 11 and subsequent listing was scheduled for June 12 but it has remained silent–including on revealing the IPO outcomes–since then, causing anxiety among some of its new investors.

The company’s MD, Mr Ian Ferrao, told The Citizen on Monday that Vodacom was only awaiting regulatory approvals from capital markets authorities to go ahead with listing after a total of 40,000 new investors bought shares.

But speaking after eight Cabinet ministers and his deputy, Dr Ashatu Kijaji responded to some other issues as raised by MPs during the six days of the budget debate, Dr Mpango, said the government is amending the Epoca 2010–probably through the Finance Bills 2017–so as to allow more investors to take part in telecommunication firms’ IPOs.

“If a company that will have issued an IPO and fails to raise the required amount, the relevant ministry will come up with a modality that will guide it (the company) on how to raise the entire money as required by the law,” he said.

Dr Mpango’s statement comes at a time when Airtel Tanzania has already successfully completed the process of issuing an IPO after India’s Bharti Airtel and the Tanzanian government successfully agreed to offload 12.5 per cent of their shares each.

Similarly, Maxcom Maxcom Africa–popularly known as MaxMalipo–has already received the approval of capital markets authorities to change its name to a plc while several other telecommunications companies are on several stages of issuing their IPOs in line with Epoca 2010 as amended in the Finance Act 2016.

Water supply

Responding to some of the issues, Dr Mpango said the government has noted with concern that water remains a serious challenge in various constituencies but hastened to say that at least six major projects–currently in offing–will relegate water blues to history.

“Similarly, we are currently finalising a $500 million (about Sh1.1 trillion) from Exim Bank of India that will specifically be targeted towards alleviating water shortage.

The government is also targeting to get some money through the Green Climate Fund–which assists developing countries in adaptation and mitigation practices to counter climate change–to source money the Simiyu Water Project.

Road licence

Presenting the Sh31.7 trillion revenue and expenditure plan for the financial year 2017/18 in the House on Thursday, June 8, Dr Mpango announced the abolition of the annual motor vehicle license fees and instead increased excise duty on petroleum products by Sh40.

The proposal did not, however, go down well with some MPs, with the Opposition bench saying it would affect the poor–mostly those who use kerosene–hard.

In response however, Dr Mpango said exempting the Sh40 on kerosene may result in fuel adulteration. “Currently, the difference in excise duty rate between petrol and kerosene is only Sh53. If we exempt kerosene from the proposed Sh40, the difference will rise to Sh93 and that will entice sellers to mix kerosene with petrol and maximize their profits,” he said.

Property tax

During the budget presentation, Dr Mpango said the government will continue to collect property tax for both valued and non-valued houses in all local government authorities.

He said TRA would continue collecting the tax as determined by the Minister of Finance and Planning, noting that for unvalued houses, a flat rate of Sh10,000 per normal house will be charged and Sh50,000 on every floor of a multiple-storey house.

However, the proposal was opposed by the opposition MPs who said the move meant that even the poor–who live in mud-walled, thatched house would also be required to pay tax.

In response however, Dr Mpango said going by the Urban Authorities (Rating) Act, 1983, the houses for which tax is to be paid are those built in cities, towns townships.

“In the same vain, claims that the retired people will also be subjected to this form of tax make little sense since the law says people above 60 years will not be subjected to tax payment,” said Dr Mpango.

MCs, caterers

In the endeavour to increase tax revenue, the government is also targeting caterers and those working as Master of Ceremonies (MCs) in various projects.

Presenting the budget, Dr Mpango said small scale business operators including food vendors, small scale second hand clothes sellers, sellers of agricultural products such as vegetables, bananas and fruits among others would be given special identity cards as the government seeks to identify them so they could be given special places where they will conduct their businesses from.

Bank lending rates

The other hot topic was the one on commercial banks’ lending rates, which were described as being too high to nurture the growth of the private sector, with some MPs blaming the situation on the government’s huge appetite to borrow locally.

But according to Dr Mpango, it is impossible for the government–through the Bank of Tanzania–to regulate lending rates in commercial banks, saying that if it does so, it won’t be able to bring the banks to task when they register losses.

“It should also be remembered that our economy has grown by an average of 6.7 per cent for the past ten years due to the policy of leaving interest rates to be controlled by market forces,” he said.

He said as much as he understands, the major challenge facing commercial banks now is an increase in the level of non-performing loans (NPLs).

“BoT has instructed commercial banks to ensure that they bring their rising NPLs back to an average of five per cent of their total gross loans. They have also been instructed to make use of credit reference bureau to know some of the habitual defaulters,” he said.

COLUMNBy Kasera Nick Oyoo

That Africa needs to redress the huge gulf between its wealth and its poverty is a foregone conclusion.

Statistics of outflows from Africa against inflows in everything from aid, foreign direct investment to remittances will boggle the mind.

But you already know that.

What Africa needs to do about it is another matter altogether. President John Magufuli seems to agree with the view that there is outright robbery which must come to an end.

Others, and especially so if they are beneficiaries, feel foreign investment shall be destabilised if radical adjustments are made.

There needs to be common ground because radical approaches will do more harm than good. However, we must begin by establishing some hard truths as to where the rain began to beat Africa.

Not so much as to the timing, although that too is of significance, but to the complicity of a combination of factors that have enabled Africa’s wealth to continue to make Western capitals glitter in diamonds, gold and silver while Africans remain basket cases worth of pity.

Back in the old continent, we are our worst enemy. Africans are hopelessly divided on the basis of nations and our friends in the richer world exploit these divisions to the maximum to the detriment of Africa.

Take the on and off case of common external tariff in the East African Community (EAC). We have everything in common that includes natural resources. Many of the people in this region share common ancestry, traditions and languages. Unfortunately, our politics, which drives decision making, are also shared in their naivety. None of which convinces us that tourists visit our regions not because of our common borders, but to enjoy flora and fauna that do not share such a myopic view of national borders.

Year after year in schools and colleges, our curriculum still takes the view that each of our nations is self-sufficient and that its worst enemy is the sister nation next door. We continue to exhort the war across the River Kagera to remove Iddi Amin as if it was a war between Tanzania and Uganda. It wasn’t.

Recently no debate has dominated headlines more than the ban on mineral concentrates and its ramifications.

Last week, at the Annual Mwalimu Nyerere convention at the University of Dar es Salaam, Professors Bathily of Senegal and Lumumba of Kenya spoke very passionately about African unity.

This war that Dr Magufuli has started has been waiting for someone to start it. It needs one to be bold, daring and willing to face the consequences for consequences shall be there.

But in the bigger context, the two professors are right that for this war to be won the approach must be Afrocentric. That means this is really not about Acacia versus the government of Tanzania. Our friends, if you notice showed up with the Canadian High Commissioner to Tanzania. It tells you this matter goes beyond Acacia. It’s an economic war.

There is a chance now for us to engage as a region and get the best of us to prepare in advance for negotiations. There will be conditions ahead of negotiations. This is a hurdle we must be prepared for.

International diplomatic stakes are in high gear. Lobbying is going on out there; we cannot afford to wait to get EAC, South African Development Community and African Union on our side.

Individual countries too, for after all, the same North Mara Gold Mine belt stretches into Macalder Mines in Kenya and Acacia have an interest there as well.

We should remain firm and focused, unleash the best for this country and the continent to have a win-win deal. That will depend on how well we are prepared to face this onerous task.

By Anthony Wesaka

Kampala — The Court of Appeal has ordered government to pay over Shs100b to about 1000 former spies under Internal Security Organisation (ISO) in terminal benefits.

The ruling by Justice Remmy Kasule upheld the 2005 judgment of the High Court that awarded the same former spies Shs72b, which the government’s Attorney General and leaders of the complainants later negotiated downwards to Shs36b.

The money attracted interest of 10 per cent per annum as ruled by Justice Okum Wengi of the High Court, about 12 years ago.

“The remedies to be pursued must be those that ensure that the judgment of the court is respected and complied within its entirety by all parties to the suit. The judgment debtor (Attorney General) has to fulfil what the judgment orders him to do. The judgment creditors (former spies) must get in full what the judgment has awarded to them. The remedies must be to ensure that a court of law does not act in vain whatever the circumstances,” Justice Kasule ruled in his judgment delivered on June 12.

Due to the accruing interest, the amount the government owes the former intelligence operatives has accumulated to more than Shs100b to-date since the High Court judgment was passed.

About 1,000 intelligence officers sued government for terminating their services and failing to pay them their terminal benefits.

They said their employment was terminated contrary to the law and in denial of their terminal and severance packages and as such they had suffered loss and damage.

They sought court orders for terminal benefits, pension, gratuity, arrears of unpaid allowances, money in lieu of notice of termination, medical and transport allowances as well as general damages.

On May 20, 2005, the then trial judge of the High Court Wengi ruled in favour of the former spies and granted them all their prayers in the suit.

The court also awarded each of them Shs500,000 as general damages.

The other issue that Justice Kasule determined in his ruling was the prayer by the ex-spies to substitute three of their leaders whom they accused of colluding with the AG to vary the original award from Shs72b to Shs36b without the consent of others.

However, in his ruling, Justice Kasule referred them back to the High Court which originally handled the case to sort out this issue if they suspect the terms and amount of their compensation were altered to their disadvantage.

Counsel Roberts Kagoro and Fred Muwema from Muwema & Company Advocates, who represented the former spies in court, welcomed the ruling of Court of Appeal.

“This ruling has far reaching implications in that judgments of the court now can’t be varied by the AG just like that,” Mr Kagoro said by telephone yesterday.

When Daily Monitor contacted Mr Denis Bireje, the director civil litigation in the Justice ministry, about the ruling, he said he had not yet received it and could therefore not ably comment on it.

ANALYSISBy Sauli Giliard and Emmanuel Mtengwa

Fadhili Mbwambo was among people who participated in last year’s Dar es Salaam International Trade Fair (DITF) famously known as saba saba. He didn’t participate as a shopper but as an exhibitor. It was an opportunity for him to promote his leather products.

The 37-year-old shoemaker says, “The 2016 fair was a good opportunity for I not only sold my products but I also received many business orders. Unfortunately I could not take all the orders due to lack of capacity to produce shoes in large quantities.”

The father of two does not have the required machines to help him produce enough shoes in a short time. He met a Kenyan trader during the trade fair who wanted to buy a large quantity of shoes but unfortunately, Mbwambo could not manage without modern shoe making machines.

“The Kenyan trader asked me if I was capable of making 100 pairs of shoes every day, but I was not in the position to do so,” Mbwambo recalls sadly. To him, this was an opportunity to penetrate the Nairobi market.

Using rudimentary tools at his workshop in Tabata-Aroma in Ilala District, Mbwambo can only make 30 pairs a day. To produce 100 pairs or more in a day, he needs a minimum of Sh10 million to buy the required machines.

“I can’t afford a leather cutting machine that costs Sh5 million, a shoes sewing machine that costs Sh3 million and a shoe sole pressing machine which is available for Sh2 million,” he says.

His main tools are a hammer, a pair of scissors, a knife and a shoe needle.

Apart from selling the shoes to ordinary customers, Mbwambo also receives orders from institutions such as the Agha Khan Hospital for staff shoes, a security company based in Dar es Salaam and some schools. He receives many school orders in January and June.

A long the Bima-Kimanga road is another shoemaker, Francis Adrian. As you approach his shoe factory, a mere three square metres room, one can hear the sound of a water pumping machine. The machine goes on and off several times before it finally comes to a stop. Then Adrian appears holding a pair of sandals. He tells me that he was using the water pumping machine to level the rough surface of the new sandals he has made.

“I use the rotating part of this water pump to make the rough surface of shoes or sandals smooth. I do so to make them look nice and attractive. I use the water pump because I cannot afford a shoe roughing machine ,” says Adrian.

Apart from using outdated technology in making shoes and sandals, the 42-year-old Adrian says the high cost of importing raw materials is another factor that is hindering the growth of the industry.

Unlike most shoe makers who learn the trade from older folks, Adrian received partial training from the United Nation’s Industry Development Organisation (UNIDO) in 2004 before dropping out due to illness. Adrian is concerned that despite the rise in the price of raw materials, the price of shoes has remained the same over the years. In 2004, when he started his small factory in Gongo la Mboto, in Ilala District, one square foot of leather cost Sh1,600. The price has gone up to Sh3,000 today.

“The wholesale price of a pair of sandals still stands at Sh8,000 today and Sh10,000 retail price.” The reason, he says is because Tanzanians prefer buying imported shoes than locally made ones. This is why shoemakers keep the price constant as a way of attracting customers.

A pair of shoe sole sells at Sh10,000 which is up from the Sh6, 000 old price. “The soles are usuallly imported from China,” says Adrian.

Like Mbwambo, Adrian, too can only produce 30 pairs maximum in a day. The reason? Poor technology and low capital.

The training challenge

When Mbwambo left Same District in Kilimanjaro Region to come to Dar es Salaam in 2002, he had no idea that shoe making would be his way of earning a living.

For nearly a decade, he worked as an assistant to a relative who used to own a small shoe making factory. His relative had trained at Peramiho Vocational Training Centre in Ruvuma Region.

“He used to run a small factory at Magomeni and so I used to help him with work for nearly 10 years. In the process, I too learnt how to make shoes,” he says.

Adrian too learnt the trade on the job. He used to help a friend at Manzese with work and earned a little money. He later attended UNIDO’s shoe making training which he could not complete. Adrian who has trained his two younger brothers to make shoes says most shoemakers in Dar es Salaam never attended formal training but they learnt from small factories like his. School fees becomes a hindrance most of the time.

Adrian’s younger brother, 31-year-old Xavery appeals to government to support shoe makers so they can compete in the East African market. He says as small -scale shoe makers they do not qualify for bank loans as they do not meet the conditions such as collateral.

EAC market potential

Mbwambo is among the 150 members of Tanzania Leather Products Producers Association (TALEPPA) who are likely to miss the opportunity to compete in the East African Community (EAC) market especially now that plans are under way to ban importation of second hand goods and leather products from overseas countries.

The ban aims to boost local manufacturing sectors in the region that will consequently increase job opportunities. To benefit from the ban, local leather products producers need capital to meet market demand.

Last year, the EAC community that now has six member states of Tanzania, Kenya, Uganda, Rwanda, Burundi and South Sudan, declared that by the end of 2019 there will be no importation of textile and shoes from outside EAC. Member States will be required to buy such goods or products within the market comprising of 150 million people.

The decision is underpinned by EAC common market protocol that guides, “the free movement of goods, people, labour, services and capital from one partner state to another as well as the rights of establishment and residence without restrictions.”

Despite the favourable decision, local shoemakers believe lack of capital, outdated technology and inadequate skills may hinder their penetration to the market. These, they say need to be addressed fast.

TALEPPA Secretary, Timothy Futo says with capital, TALEPPA members can equally compete with other producers in the EAC as they are capable of producing high quality products. He says it is difficult for local shoemakers to afford machines worth between Sh12 million and Sh30 million.

“Government should connect leather product producers with financial institutions or firms that make or supply machines so they can access loans easily,” he suggests.

If government invests in the sector, Futo believes it will help create a lot of jobs. He says government should build shoe factories including those manufacturing soles which are currently imported.

He points out that China products are killing the efforts of small-scale shoemakers. “While the Chinese counterparts are using advanced technology to produce quality products in large quantities, it’s a different story for Tanzanian shoemakers. Yet you expect them to compete in the same market.”

TALEPPA leader opined that the EAC decision to ban importation of leather products will benefit the sector only if government empowers local shoemakers to cover the anticipated deficit of leather products in the market. “Government should motivate all Tanzanians to love and use locally-made products.”

A light at the end of the tunnel

While shoemakers claim that government is not doing enough to empower them to compete in the local and East African markets, the Small Industry Development Organisation (Sido) director general, Prof Sylvester Mpanduji refutes the claim. He says government provides an enabling environment for accessing individual or group loans to purchase shoe machines.

“Yes, there are challenges in getting machines but we insist that they visit our offices to access low interest loans of a maximum of Sh5 million per individual,” says Prof Mpanduji. He adds that if someone needs from Sh10 million to Sh50 million, Sido can always link them to CRDB bank.

Other roles of Sido according to the director, include consultancy and training services to strengthen the competitive ability of small-scale industries.

Prof Mpanduji says in an effort to cut down unemployment, the Ministry of State in the Prime Minister’s Office responsible for policy, parliament, work, youth, employment and the disabled in collaboration with Dar es Salaam Institute of Technology has trained 1,000 youth on how to make leather products in Mwanza.

He calls upon established businesses to invest in shoemaking industries as the country is geared towards industrial economy.

The Prisons Department too in collaboration with the Parastatal Pensions Fund is constructing a new shoe factory at Karanga Prison in Moshi, Kilimanjaro. The factory that will use locally sourced raw materials will be completed by 2018.

Zanu-PF youth leader Kudzi Chipanga has reportedly urged Zimbabwean President Robert Mugabe to eject all remaining commercial white farmers in the country’s Manicaland province, saying they should relocate to Harare’s leafy Borrowdale suburb “where they can relax and play golf”.

According to New Zimbabwe.com, Chipanga said this during a rally that was also addressed by Mugabe on Friday in Mutare.

Chipanga said most Zanu-PF party youths remained landless even after the country’s controversial land reforms.

Thousands of white commercial farmers and their employees were displaced and left without sources of income during the fast-tracked agrarian reforms that were masterminded by Mugabe’s administration in 2000.

Fresh land grabs

“President, whites are not superior and you once told us that a good white man is one who is asleep.

“Whites are not superior; it’s time they totally vacate the farms and find a place somewhere in the leafy suburbs of Borrowdale where they can relax and play golf whilst youths take the opportunity to farm their own country,” Chipanga was quoted as saying.

Chipanga’s utterances came just a few weeks after Mugabe threatened to embark on fresh land grabs targeting the few white commercial farmers still remaining in the country.

Addressing thousands of his ruling Zanu-PF party supporters in the farming town of Marondera two weeks ago, the nonagenarian said white commercial agronomists who still remained on the farms should be removed from their properties because most Zimbabweans were in need of land.

Said Mugabe: “We are going to take those farms and re-distribute them to our youths, some of whom did not benefit from the land reform programme but the land would not be enough for everybody. We are also going to take away the land from small scale purchase farmers who are not utilising those farms for re-distribution.”

News24

By Ouma Wanzala

Teachers in administrative positions are the major beneficiaries of a salary increase whose implementation will start on July 1.

An analysis of the implementation schedule that was signed on Friday between the Teachers Service Commission (TSC) and union leaders indicate that, a teacher in administrative position currently taking home Sh16, 692 as basic salary will earn Sh62,272 at the end of four years.

These include head teacher, deputy head teacher I and senior master III.

Teachers in this category which is Job Group G to M and to be now known as C5 earn between Sh16, 692 and Sh50, 840.

FULLY IMPLEMENTED

In four years time, they will all be earning between Sh62, 272 to Sh64,631 once the increase has been fully implemented.

In the first phase for instance, a teacher in administrative position earning Sh16,692 will earn Sh29,427 which is almost double.

The analysis also indicate that lowest paid teacher with no administrative duties will now get Sh21,756 up from Sh16,692 while Chief Principal will earn Sh157,656 up from Sh144,928 per month exclusive of allowances.

This means that the lowest paid teacher will get an increase of Sh5,064 in two years while highest paid will get Sh12,692 in four years.

CHIEF PRINCIPALS

“Chief principals currently in Job Group R (D5) in the first phase will earn an increase of Sh3,432, second phase Sh4577 while in third phase they will get Sh4,719.

The lowest paid chief principal who currently earns Sh109,089 will now get Sh131,380 an increase of Sh22,291,” indicates the plan.

The highest paid chief principal in job group Q who currently takes home Sh120,270 will get Sh131,380 an increase of Sh11,110 while lowest paid chief principal currently earning Sh89,748 will earn Sh131,380 an increase of Sh41,632.

“For senior principals job group P (D4), the highest paid who takes home Sh103,894 will earn Sh121,890 an increase of Sh17,996.

The lowest paid who gets Sh77,527 will now get Sh118,242 an increase of Sh40,715,” it adds.

INCREASE OF SH25,751

Principals in job group M(D3, the highest who earns Sh55,840 will now get Sh104,644 an increase of Sh48,804 while lowest currently getting Sh41,590 will get Sh104,644 an increase of Sh63,054.

Principals in job group M(D3, the highest who earn Sh55,840 will now get Sh104,644 which translates to an increase of Sh42,857 while the highest paid who earn Sh65,290 will get Sh91,041 an increase of Sh25,751.

For senior head teachers, senior master II and deputy principals IV, the highest paid in job group M(D1) will earn Sh77,840 up from Sh55,840 while the lowest paid will earn Sh77,840 up from Sh41,590.

HEAD TEACHER

Those in Job Group N(D1)currently earning Sh48,190 will also get Sh77,840 while highest currently earning Sh65,290 will get Sh85,269.

In the head teacher, deputy head teacher and senior master III category, those in job group G(C5) currently earning Sh16,692 will get Sh62,272 while those in the same group earning Sh21,304 will take home Sh62,272.

Deputy head teacher II under C4 will also have their salaries tripled from Sh16,692 to Sh52,308.

A secondary school teacher I and senior teacher I currently earning between Sh35,910 and Sh45,880 will now get between Sh43,154 and Sh53,943.

SENIOR TEACHER

For senior teacher II ,secondary teacher II , secondary teacher II UT and primary special need education teacher in job group C2 , their salaries will be increased from Sh34,955. Currently they earn between Sh16,692 and Sh29,918.

Secondary teacher II and secondary teacher II UT and primary special need education teachers in job group K(C2) currently earns between Sh31,020 and Sh41,590 and will now earn between Sh34,955 and Sh43,694.

Primary teacher I and secondary teacher III who fall in job group H and J(C1) currently earning between Sh19,323 and 29,918 will get Sh27,195 and Sh33,994 in two years time.

Primary teacher II in job group G(B5) currently earning Sh16,692 to Sh21,304 will get between Sh21,756 and Sh27,195 in two years period.

LOWER CADRES

More than 152,000 teachers fall in lower cadres and their pay will be implemented in two phases.

The Sh54 billion salary increase deal will benefit 305,000 teachers across the country and will run until June 30, 2021. The agreement also abolished the P1 teacher position.

Kenya National Union of teachers (Knut) and Kenya Union of Post Primary Education Teachers signed the deal on behalf of teachers while TSC chairperson Lydia Nzomo signed on behalf of the commission.

Knut secretary-general Wilson Sossion said the deal is the best for teachers.

WINDING JOURNEY

“The matrix is as a result of winding journey that involved far and wide consultations and exhaustive negotiations,” said Mr Sossion.

He warned that the union will not entertain barriers created by Salaries and Remuneration Commission in future negotiations.

The worth of every job will be determined based on the category, size of school and level of responsibility.

NEW STRUCTURE

The new structure has grades B5, C1, C2, C3, C4, C5, D1, D2, D3, D4 and D5. Previously, teachers were graded in Job Group G, H, J, K, L, M, N, P, Q and R.

Primary and post-primary teachers in non-administrative positions have been moved from Grade B5 (former Job Group H) to D1 (formerly P).

Primary school administrators will be appointed substantively and placed in grade C2 (formerly K) to D1 (formerly P).

The City of Cape Town on Monday warned residents to curb water consumption, saying recent rains had done little to elevate the ongoing drought.

On Monday afternoon, the city’s storage dam levels stood at 23.1%, an increase of 3.7%, following recent rains.

With the last 10% of a dam’s water mostly being unusable, dam levels are effectively at 13.1%.

The mayoral committee member for informal settlements, water and waste services and energy, Councillor Xanthea Limberg, in a statement said that residents should still use less than 100l per person per day.

“Apart from safeguarding our current sustainability, we must think about building additional reserve capacity by continuing with the most hard-hitting water-saving efforts that we can muster,” Limberg said.

“It may take a few seasons of normal rainfall for the dams to recover and we must bear in mind that we are expecting an even tougher summer in 2018.”

Citywide consumption increased by 25 million litres per day and was 40 million litres above the target of 600 million litres per day, by Monday, June 12.

Meanwhile, Mayor Patricia de Lille said she had instructed city officials to divest from fossil fuel assets and companies in favour of greener and cleaner investments.

“We are going to instruct investors looking after our money not to put our money into fossil fuel-related companies, or for it to be used to fund the development of dirty and unsustainable projects,” she said in a statement.

“We want our investments to be aligned with our principles of resilience and sustainability.”

Source: News24

By Ismail Musa Ladu

A report seen by Saturday Monitor has revealed that Eskom Uganda Limited (EUL) is not living up to the terms of the 20-year concession it signed with Uganda Electricity Generation Company Limited (UEGCL) about 15 years ago.

The report, which reviewed the performance of the South African electricity company was prepared by UEGCL at the close of last year.

It indicates that EUL is transferring money out of the country without reinvesting it into the power plant, contrary to the conditions of the concession.

However, in a detailed response, Eskom contests the findings of the report, saying on the contrary, everything possible has been done to implement the Concession and Assignment Agreement (CAA) to the letter.

The 2002 CAA signed between UEGCL and EUL requires the South African electricity company to maintain and operate Kiira and Nalubaale hydroelectric power stations for a period of 20 years.

The two power dams, located in Jinja, eastern Uganda, generate a combined capacity of 380MW.

But findings of the report reveal a number of shortages, key among which include the failure to run the 15 key units in the complex. Only 13 are fully operational, which negatively impact on power generation capacity and availability.

The report also shows that there is currently no plan to conduct remedial works on the Nalubaale Power House despite recommendations from various studies.

According to the report, maintenance of critical equipment is also lacking with some failing to work normally, compromising the safety of the plant.

For instance, the report says, the switchyard computer, compressed air system and 110 VDC battery bank, all at the Kiira Power Station, have been badly maintained and are currently facing the risk of failing.

“EUL has performed satisfactorily from the production side; however, performance in respect to maintenance of the plant(s) is below expectation,” the report prepared by UEGCL management late last year, reads in part.

“This in itself points to the fact that Eskom has not fully complied with the CAA objective of restoring and maintaining the plant for posterity of the asset life, and there is an imminent threat of handing over (after the concession has expired) a derelict plant at the end of the concession,” the report further reads.

While reviewing the investment injected in operation and maintenance between 2003 and 2015, the report reveals that Eskom has invested less than it should have, contrary to the requirements of the concession.

According to the review of the performance report, operation and maintenance cost into the power complex averages at about Shs5.3b per year, which is about 33 per cent less than the manpower cost.

UEGCL, which owns the two plants on behalf of government, believes that the operation and maintenance budget of the two complexes should be in the region of Shs14b at the very least.

Therefore, the report suggests, it has been difficult for the Electricity Regulatory Authority (ERA) and UEGCL to determine what constitutes investment because there has not been clear and agreed terms of reference to guide the two stakeholders.

For the meantime, however, Eskom continues to make profits with declining revenues that could be a result of low investment in operation and maintenance.

The report also reveals that there could be no investment originating from the Eskom Uganda parent company, considering it has been facing challenges back home.

This, the report reveals, has forced Eskom to rely on a business model that rotates around saving money and making profit from the operation and maintenance.

“The concession of the state-owned asset has not substantially improved. UEGCL feels that now is time to commence preparation to take over the management of the plant as capacity is built within the sector to manage its assets, and reduce on pilferage of assets,” part of the report says.

The general breach of the CAA, according to the report, puts the two dams at risk yet there is no sufficient evidence to suggest that Eskom can within the remaining six years of the concession come good on its promise as agreed in the concession.

Regulator’s take

When contacted last week, the owners of the two power complexes on behalf of the government had this to say: “It is true UEGCL’s mandate includes monitoring the performance of the operation and maintenance regime at Nalubaale and Kiira hydro power complex. Matters arising out of the performance monitoring are addressed in accordance with the CAA.”

The UEGCL adds: “Indeed remedial and mitigation measures are clearly spelt out. Failure to heed the asset owners (UEGCL) recommendations and findings have reprimands which are also clearly spelt out in the CAA.”

The statement issued by the UEGCL corporate affairs manager, Mr Simon Kasyate, also quoted the acting UEGCL chief executive officer, Mr David Isingoma, as saying: “We can authoritatively say that the issues you are referring to are being handled in accordance with agreed procedures. We remain unwavering in our execution of this cardinal mandate and as such, take the assurance that we are and have been doing our best to ensure proper asset care and management of the Nalubaale/Kiira hydro Power complex.”

On Wednesday, the ERA principal communications officer, Mr Julius Wandera, told Saturday Monitor that they have not seen the report (EUL performance review) yet.

He said: “I cannot comment because I am not aware about that report. And even then I will have to internally verify it before saying anything. But at the moment I am not aware about such a report.”

Eskom reacts

In a written response to questions from this newspaper, Eskom said all its operation and maintenance activities are highly regulated and approved on an annual basis by ERA, Uganda Electricity Transmission Company Limited (UETCL) and UEGCL.

“We are operating as per the guidelines within the CAA and indeed we have consistently met our obligation,” reads part of the statement.

The statement further said the complex is comprised of 15 units, 10 at Nalubaale and five at Kiira power station. And that all the five units at Kiira are fully operational. The two units, three and 10 at Nalubaale, are currently undergoing extensive overhaul and the company expects to bring unit three back to operation by the end of the year.

“High level engineering works are involved as the entire unit is dismantled up to the turbine. Both overhauls were for improving performance of the units and were duly approved by both UEGCL and ERA,” the statement reads.

Escom said a technical plan approved for the period 2015-2018 by both ERA and UEGCL was in place, and that it is reviewed annually “in line with current landscape and again approved by both UEGCL and ERA”.

On maintenance of key installations, Eskom said although they recognise that all equipment at the plant requires regular maintenance and replacement, “we have prioritised all our technical interventions based on our robust engineering risk assessment, and indeed the prioritisation also involves consultation and approval of the asset owner and the regulator.”

Regarding operation and maintenance cost, Eskom wrote: “We don’t know the basis where these figures (in the report) were derived from. Our maintenance cost budget is approved by ERA based on the agreed upon outage plan (maintenance programme) by both UETCL and UEGCL. Prior to ERA’s approval, the costs were scrutinised and benchmarked and found to be reasonable in line with the needs of the plant and tariff considerations of the country.”

The company, in response to the charge that it is not investing enough, said it “is a puzzle to note that we scale down on maintenance to do more investments, at the same time, we are seen not to do investments and remain profitable.

Escom added: “Our revenue is determined by ERA and it includes many parameters that can be well explained by the regulator because not all such parameters are within our control. Notwithstanding, EUL is a profitable company based on its efficient operations and investments.”

On the accusation that Escom’s parent company has not been supporting Escom financially, Escom Uganda wrote: “The parent company has been supportive right from the start of the concession where we had to meet all the investment obligations as stipulated by the licence agreement and will continue to deliver their support as they are the custodian of the company’s funding plan.”

Escom added that its annual maintenance plan, which is agreed upon by UETCL and UEGCL and approved by ERA, has been “executed consistently over the years.”

Escom said: “It should also be noted that the Concession Agreement requires us to hand over the plant in an operable condition. Aware of this obligation, our maintenance philosophy and investment plan are geared towards this and to date over $20 million (about Shs72 billion) have been invested and additional $25 million (about Shs90 billion) will be invested in the next five years.”

To sum it up, Escom argued: “We operate in a highly regulated sector which has a direct influence and impact to our only customer, who is also the system operator (UETCL) to whom we sell the power in line with the power purchase agreement and the regulator (ERA) who regulates our operations in line with our generation licence.”

Background

Eskom Uganda took over operations and maintenance of the power generation complex from UEGCL in April 2003 after being awarded a 20-years concession. The concession is now left with about five-six-years to run out. Before then the complex was being managed by UEGCL.

The senior management of the South African electricity company about two months ago in Jinja told President Museveni that more than $2 million (about Shs72.3b) has been invested here to date in upgrading systems and equipment at the power plant.

They also told the President that Eskom intends to invest an additional $25 million (about Shs90 billion) in the remaining period of the concession in upgrades and new systems to sustain electricity availability.