MUTAPA INVESTMENT FUND: A GRAND HEIST OR A GENUINE SOVEREIGN WEALTH FUND?

The spotlight is once again on President Emmerson Mnangagwa, as fresh concerns arise about the rebranded Mutapa Investment Fund (MIF), previously known as the Sovereign Wealth Fund (SWF). Accusations are flying thick and fast, suggesting that this venture is a meticulously orchestrated scheme, mirroring Russian oligarchs’ methods, to allow the politically influential to acquire invaluable state assets at a fraction of their worth and subsequently sell them for vast profits.

President Emmerson Mnangagwa’s controversial Mutapa Investment Fund (MIF) – formerly the Sovereign Wealth Fund (SWF) – is a calculated grand heist scheme designed facilitate to help the politically connected to snatch up valuable state assets at dirt cheap prices and flog them for huge profits Russian oligarchs-style, a former cabinet minister has said. Tendai Biti, former Finance minister, says the MIF is unconstitutional, illegal and opaque, as well as murky and muddy to ensure that it is not transparent and accountable to facilitate looting on an industrial scale. “The Mutapa Investment Fund is conceptually flawed; it is like an asset management behemoth created to house state enterprises and related assets illegally, make them fungible and easily transferrable. It’s not a typical Sovereign Wealth Fund as we know it. It’s not like the Norway’s US$1.4 trillion Sovereign Wealth, the biggest in the world, for sure,” Biti told The NewsHawks in an interview. “A normal sovereign wealth is a state-owned investment fund comprising of money generated by government surplus reserves or its resources to create wealth for current and future generations. It’s a pool of assets owned and managed directly or indirectly by governments and invested in stocks, bonds, real estate, precious metals, or in alternative investments such as equity funds or hedges funds to achieve national objectives. “For instance, before this Mutapa scam, we had created a proper sovereign wealth fund in 2014 because Zimbabwe has world-class deposits of gold, platinum, diamonds, chrome and now lithium. Yet these are non-renewable natural resources so we need to exploit them for current and future generations. Collect royalties and invest them in a sovereign wealth fund.” Biti says the changing of SWF to MIF has created conduit for industrial scale looting. “Mnangagwa’s opaque structure is a scheme for a grand heist. We will witness unprecedented grand scale looting and industrial scale corruption under this Mutapa Fund. The structure is flawed conceptually. It is also unconstitutional. It is illegal. It was established through a statutory instrument, a presidential decree, violating the constitution, laws and principles of separation of powers,” he said.

The revelations come from none other than Tendai Biti, Zimbabwe’s former Finance minister. Biti doesn’t mince his words when he describes the MIF as “unconstitutional, illegal, and opaque.” His primary concern is the lack of transparency and accountability inherent in the Fund, which, according to him, is designed to promote large-scale plundering.

In a candid conversation with The NewsHawks, Biti criticised the MIF’s core concept. He expressed, “The Mutapa Investment Fund is conceptually flawed; it seems more like an asset management giant, unlawfully formed to govern state enterprises and associated assets. Its main objective appears to make these assets easily transferable.” Biti further compared MIF to the world-renowned Norwegian Sovereign Wealth Fund, which boasts a staggering US$1.4 trillion, noting the stark differences between the two. “It’s not a typical Sovereign Wealth Fund as we understand it. It doesn’t even come close to Norway’s impressive fund,” he stated.

For those unfamiliar with the concept, a sovereign wealth fund is essentially a state-owned investment pool, comprised of surplus reserves or resources, aimed at generating wealth for both the present and future generations. The assets within such funds are typically managed directly or indirectly by governments and are diversified across various sectors – from stocks and bonds to real estate and precious metals.

Drawing on Zimbabwe’s rich natural resources, Biti recalled the establishment of a legitimate sovereign wealth fund in 2014. “Zimbabwe is blessed with world-class reserves of gold, platinum, diamonds, chrome, and now, lithium. These are all non-renewable resources. Hence, it’s imperative that we exploit them not just for our current populace but also for future generations. The ideal way forward is to collect royalties from these assets and invest them diligently in a sovereign wealth fund,” he elaborated.

However, the metamorphosis of the SWF into the MIF has raised numerous red flags for Biti. He believes that this transformation is merely a façade for industrial-scale looting. Biti doesn’t hold back in his criticism of President Mnangagwa, asserting, “Mnangagwa’s nebulous structure is nothing but a blueprint for an epic heist. Under the guise of the Mutapa Fund, we’re set to see corruption and looting on an unprecedented scale.”

He further lambasted the establishment of the MIF, deeming its inception as a violation of constitutional norms. “It’s not just conceptually flawed; it’s downright unconstitutional. Furthermore, it’s illegal. The MIF came to life through a statutory instrument, a presidential decree, which blatantly infringes upon our constitution, laws, and the sacred principle of separation of powers,” Biti concluded.

As the debate rages on, the real question remains: Is the MIF a genuine attempt at safeguarding Zimbabwe’s future, or is it just another ploy in the playbook of the powerful? Only time will tell.