PF government stuck with ZANACO Inquiry

By Geroge Lubasi
When Michael Sata directed Sebastian Zulu to probe the sale of ZANACO to Rabobank, he had already concluded that it was a “corrupt transaction”. Like all other predetermined Commissions of Inquiry, that was the premise on which Zulu proceeded.  
When the news reached Rabobank in the Netherlands, they were shocked. It was for that reason that senior managers from Amsterdam hastily flew into Lusaka to get the full story as well as testify at the Inquiry.  The Dutch government took the matter so serious that they ordered their Embassy in Lusaka to closely monitor the Inquiry and keep their government back home updated.
The European Union has strict laws on financial and corporate governance. It demands of companies owned by its member states to operate above board.  Companies of EU members that engage in corruption or any deceitful dealings are expressly banned from operating in other EU states. The sanctions can be so severe that such companies cannot access capital from any EU institution. That was why during the sale of ZANACO, Rabobank ensured that they followed every law and procedure that was required.   
What mostly unsettled Rabobank was the highly astounding claim by David Chewe, a member of the Commission of Inquiry that no money was paid for the sale of 49% shares in 2007.  Apart from being a lie, Chewe’s comment was sour grapes because he was once a ZANACO employee and his departure was quite unceremonious. Thus being a member of the Inquiry now gave him an opportunity to get back at his ex-employers.  The question that Rabobank asked was how were they allowed to take over the bank if they didn’t pay anything? Was the Zambian government so stupid to surrender such an asset for nothing?
When ZANACO was advertised, a group of Zambians led by Bwalya Chiti (currently Zambia’s Ambassador to Germany) had put up a bid via the Zambezi Consortium. They lost to Rabobank. Chiti and group misled Sata when he became president that ZANACO was sold corruptly and that was the message Sata gave to Zulu. Like in Chewe’s case, this was mere sour grapes.
When the Inquiry sat at Mulungushi International Conference Centre, it operated on the basis that the bank was sold corruptly. They had to do a serious screening of witnesses who would lend credence to their case of ‘corrupt sale’.  Ngandu Magande, who was Finance Minister at the time ZANACO was sold, publicly expressed interest to testify if he was called. But because Zulu’s team knew Magande would tell them as it was, they avoided him.  Among other witnesses, they settled for Michael Musonda who was also hired as legal consultant to the Inquiry.  Musonda told the Inquiry that it was wrong for Price Water House Cooper (Kenya) to have been hired by DFID to offer valuation consultancy on ZANACO in 2001 and 2004 and later became transaction advisors. This, he argued, was a conflict of interest. But Musonda himself was a legal consultant to the Inquiry as well as a witness. How impartial was his testimony when he was paid by the same Inquiry?  
Aware of the premise they were operating from – that the bank was sold corruptly – Zulu’s team was so animated when listening to evidence of those claiming the bank was undervalued or was corruptly sold. They amplified this evidence by attempting to compel witnesses to use ‘corrupt sale’.  They were short of clapping when Musonda finished his testimony. Those who submitted that the sale was clean were questioned at length and sometimes asked questions beyond the scope of the Inquiry.   
Despite a determined attempt to link Rabobank or sale of ZANACO to corruption, the Inquiry found no such evidence. Instead, Rabobank provided hard evidence showing that it negotiated and conducted the transaction within the law. Further, the Secretary to the Treasury had confirmed to Rabobank that the money for the 49% shares had hit the government account at Bank of Zambia. That was what made Chewe’s claim ridiculous.
The Inquiry report was done but Zulu was not sure how to hand it over to Sata when its findings are contrary to Sata’s deeply held view that corruption was involved in the sale of the bank. For now, the report remains under lock and key.  
Ideally, Sata should have directed Wynter Kabimba to complete all assignments left by Zulu, among them to handover the ZANACO Inquiry Report. But he was sent to review the concessioning of Zambia Railways. Whether Sata or Kabimba will revive the ZANACO issue whose findings are a slap in their faces remains to be seen. 

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