ZIMBABWE – The former CEO at Barclays UK, who resigned in 2012 after the bank was fined a record amount for trying to manipulate lending rates, is set to organize a bond worth millions to help the broke Mugabe regime.
Finance Minister Patrick Chinamasa told reporters Wednesday that Robert Diamond’s company Atlas Mara Co-invest had promised to organise “an issuance of a European bond” worth $207 million. This is part of the cash-strapped government’s efforts to raise money to fund its operations.
Concern has been raised over Diamond’s links to George Manyere, an investment banker and former World Bank official, whose company was hired by government to oversee the “indigenization” of foreign firms. Through his company Brainworks, Manyere last year faced allegations that he had profited from a deal involving the mining giant Zimplats.
According to The Telegraph newspaper, Manyere’s Brainworks was paid $40 million to simply prepare the indigenization agreement between Zimplats and a local community ownership trust. Manyere is an adviser and member of Diamond’s “founder network” for his Atlas Mara, an investment vehicle that raised $325 million for African projects.
Harare based economist Tony Hawkins said Diamond’s company has the necessary connections and this week bought local Zim bank BancABC. But Hawkins told SW Radio Africa that the deal with Diamond will increase Zimbabwe’s already large foreign debt.
“My feeling is simply that for Zimbabwe to raise more offshore money at this stage when it has already over-borrowed and has huge arrears is not a sound strategy from a long-term viewpoint, rather than criticism of Diamond and what he does. We need to reduce our offshore debt not increase it,” Hawkins explained.
Chinamasa and Diamond expressed confidence in the prospects of raising enough money for the Zim bond. But many Zimbabweans commenting online said no investors in their right minds would sink money into a country where government policy requires that 51% of all foreign firms be controlled by locals.
Others were more critical of Diamond, with one saying: “With a bit of luck, Diamond will be left holding the bonds, instead of Muppets. Then he can get some sense of emerging market risk in a country that has no respect for property rights, of any kind. It might be illuminating for him.”