Editorial Comment: Essar deal discord proves inclusive Govt is counterproductive

mineral rights of ore to Essar only for actual value.
This position, made during his appearance at a Parliamentary Portfolio Committee on Industry and Commerce hearing on Monday, went some way in clearing the air on the issue.
All along we had wondered why it had taken so long to get NewZimsteel functional. But more questions still arise. How was it possible that such a deal could be signed without the involvement of the Minister of Mines and Mining Development, who happens to sit in Cabinet where such matters are discussed?
Equally surprising is the position of the Minister of Industry and Commerce, Professor Welshman Ncube, who recently told the same committee that the Mines and Minerals Act did not provide for valuation of minerals before a licence is granted; hence no valuation was done.
If the law does not provide for that valuation, we would want to think that common sense dictates that such valuation be made. The fact that no such valuation was done for other minerals such as diamonds shows that there is something wrong with the way we are entering into deals with foreign investors.
Deputy Prime Arthur Mutambara has previously raised alarm that we need to be more thorough before making decisions about how minerals are being exploited by foreign investors who would have come to partner us at our invitation. He was not taken seriously.
Essar are right to feel aggrieved. When dealing with one minister of the Zimbabwe Government and his officials they have every reason to believe that he is representing the Government position. They should not wake up tomorrow hearing a different position from the same Government, albeit from a different minister in a different portfolio.
Just last week there was the case of the Chisumbanje ethanol project, which is now being renegotiated from a Build, Operate and Transfer agreement into a joint venture deal. Again there was a bit of discord between the Minister of Agriculture, Mechanisation and Irrigation Development, Dr Joseph Made, and the Agricultural Rural Development Authority chairman, Mr Basil Nyabadza, in terms of the public communication on the matter.
The fact that Cabinet is now revising the deal shows that something went wrong along the process of entering into the agreement. Yet the Indigenisation and Economic Empowerment Act is clear on what should have happened.
As Zimbabweans we are learning all the time how to get the best out of our natural resources. We need to continue to strengthen ourselves and boost our skills to negotiate the best deals for posterity.
This is the future of our children. They must not ask us tomorrow how we entered into some of the agreements.
Admittedly, we are negotiating under immense pressure because of the economic sanctions. We are tempted to do certain favours for those friends who have stood with us in difficult times. So some of the decisions must be understood and accepted in that context as long as they are reasonable.
But this must be made clear to everyone. We thought the Essar deal fell in this category and this is why the 51-49 percent ratio did not apply. We thought the Indians were rescuing us from a tight corner and bringing life back to a whole community that was stranded.
When we waver in the decisions we make we create the impression that we cannot be trusted. We send confusing signals to investors. Investors want to get the sense that they are dealing with a unitary state and with one government which speaks with one voice. Whatever differences the members of that government might have must be ironed out indoors and never spill into the public domain.
Perhaps this is one of the weaknesses of an inclusive government or government of national unity. It has too many internal contradictions, which may be difficult to contain and will occasionally spill over. Before the advent of the inclusive Government it was rare to have such policy inconsistencies as we are now seeing. Whatever position was taken on an issue would be dictated to by the policies of the ruling party and all functionaries of the government tended to follow that direction.
Investors find it easier to deal with governments that are stronger and guarantee their investments. This is why we find it desirable that Zimbabwe should go for elections at the earliest possible date so that the future of the country is secured.
It is good that Parliament has started to inquire into the Essar deal as part of its oversight role and hopefully it will help the feuding ministries to find a common position which can be communicated to the investor. This should have been done much earlier. Whatever decision is made it must be in the national interest; Zimbabwe must win and so should Essar.
It is not too late to redeem the confidence and goodwill that has been damaged by the uncertainty we have shown over the Essar deal. The bottom line is that production must start as soon as these sticking points are cleared.