Bill undermines Parly role on govt borrowing: Zela

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THE Zimbabwe Environmental Law Association (Zela) has said the recently gazetted Constitutional Amendment Bill should be rejected as it promotes secrecy, thereby increasing lack of transparency and accountability in the government’s use of mining rights as collateral for securing loans.

This comes amid widespread calls from various civil society organisations, including the Zimbabwe Human Rights NGO Forum and Crisis in Zimbabwe Coalition, for the public to reject the proposed amendment Bill, saying that it takes the Constitution back to being restrictive.

“It is now a known fact that the government of Zimbabwe accelerated the signing of investment agreements by the executive under the ambit of the Zimbabwe is Open for Business Mantra. This has been more evident in the mining, energy, oil, gas and infrastructure development sector. A lot of deals were publicly announced.

“Therefore, Clause 23 of the Amendment Bill appears to be meant to put beyond parliamentary scrutiny mining related financing agreements or loans between Zimbabwe and foreign credit banks or other financial entities,” Zela’s deputy director Shamiso Mtisi said.

Mtisi added that this trend is likely to continue given the squeeze the country is facing due to its unstable economic and political environment.

“The Parliament of Zimbabwe needs to analyse whether or not the mega deals being negotiated will actually translate into tangible benefits for the general populace. If this function is removed, this can be envisaged as free rein for the executive.

“Without any parliamentary oversight and approval of agreements that impose fiscal obligations on the country, Zimbabwe might further fall into a debt trap from secretive projects that may include punitive repayment terms, certain immunities or exemptions to foreign companies,” he said.

Mtisi further said another effect of the proposed amendment is that loan agreements and government guarantees in the mining sector will not be subjected to intensive public scrutiny due to removal of parliamentary approval.

“It also deprives civil society and citizens an opportunity to glean and monitor proceedings related to agreements with foreign entities and organisations imposing fiscal obligations on the State.

“Arguably, the other ripple effect of the proposed amendment is that it will water down the role of Parliament when it comes to state borrowings and state guarantees in Section 300 as well as contract performance and negotiation in Section 315(2) of the Constitution, which respectively requires Parliament to pass an Act of Parliament on setting limits to debts and obligations and concessions of minerals to ensure transparency, honesty and competitiveness,” Mtisi said.

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