Falling out … President Emmerson Mnangagwa (C) stands next to Chairman of South African Moti Group Zunaid Moti (L) during the launch of an Aluminothermic Plant by Zimbabwe’s biggest chrome miner African Chrome Fields (ACF), which is part of the Moti Group, in Kwekwe, Zimbabwe, on July 25, 2018
HARARE – Controversial South African tycoon Zunaid Moti is scaling down his Zimbabwe mining operations amid revelations that his relationship with President Emmerson Mnangagwa has soured.
Moti and petroleum tycoon Kudakwashe Tagwirei of Sakunda Holdings are in a joint venture at the African Chrome Fields near Kwekwe, but Moti says Zimbabwe has become a “bad investment destination” for his Moti Group company.
Moti says the toxicity of the Zimbabwe investment is now affecting his other businesses.
“There’s a lot of pressure out there. People ask why we’re in business in Zimbabwe. That has affected our ratings. Some people wouldn’t want to do business with us because we’re in Zimbabwe,” Moti told the Sunday Times.
African Chrome Fields has shut down all but one plant and retrenched hundreds of workers, which Moti’s company – the Moti Group – blames on a decision by the central bank to re-introduce an unstable local currency.
“The situation got so bad that we couldn’t procure spare parts from China and other countries because we were trading in the volatile RTGS currency (now Zimbabwe dollar),” Moti legal adviser Ashruf Kaka said.
Kaka said African Chrome Fields would be fully operational if Zimbabwe had a “proper dollar economy”, adding: “Unless and until economic reforms are adhered to, Zimbabwe will be a bad investment destination.
“If you invest in Zimbabwe, you get stuck. You can’t take out your money or rather realise profits because of the failing RTGS dollar that replaced the United States dollar.”
At its peak, African Chrome Fields boasted that it was Zimbabwe’s biggest exporter of chromium, employing 1,600 workers with an output of 30,000 tonnes annually. Over a thousand workers have been retrenched or left, turning the US$250 million investment into a white elephant.
Moti is a close ally of Zimbabwe’s vice president Constantino Chiwenga, who is currently hospitalised in China after falling ill in May.
ZimLive understands Moti fell out of favour with Mnangagwa in late 2017 when the then vice president was sacked by President Robert Mugabe and needed to flee the country. Mnangagwa reportedly asked Moti to allow him use of his private jet but the businessman baulked, fearing Mugabe’s wrath.
Mnangagwa later conspired with the military then headed by Chiwenga to oust Mugabe, before returning and being installed as the president.
Kaka said: “We respect both men in their respective offices. We are not politicians but investors. We want what’s good for our investment.
“He (Mnangagwa) never asked us for our help. I was in Zimbabwe when he was fired from the government. He could have even used any flight out of the country if he needed to.”
Relations did not improve when Moti was arrested in Germany last year on an Interpol red notice warrant, accused of defrauding Russian citizen Alibek Issaev out of several million dollars in an alleged bogus mining deal. The alleged incident took place in Lebanon in 2013.
He was also accused of stealing a rare US$35 million pink diamond.
Kaka said: “I personally went to see President Mnangagwa to ask for help to get Zunaid released. Nothing came of it. We ended up using South African authorities. They were better placed to assist.”