$300 mn Russian pledge for Zimbabwe mystery

John Helmer'17-OCT-06 10:00'

MOSCOW (Mineweb.com) --An announcement last week by Zimbabwe government officials in Harare that a Russian group has signed a pledge to invest $300 million in Zimbabwe's mining, power, and aviation sectors is unsupported by the Russian side, and may even be a hoax. On the other hand, the past history of Russian visitors to Harare suggests that RusAviaTrade may be the camouflage for something more serious that is yet to be disclosed.

"These MOUs [memorandums of understanding] are worth $300 million, but we hope we will develop our relations so that we bring more investments into the country," Yury Panchenko, external affairs director of RusAviaTrade, was quoted by wire services as saying after the signing ceremony. The investment pledge wound up a visit reported to include 31 Russian businessmen and 17 journalists, who had been invited by Gideon Gono, governor of Zimbabwe's Central Bank.

Zimbabwe's Ambassador to Moscow, Phelekezela Mphoko, has refused to identify the names of the Russian delegation members, or their company affiliations.

Russian Ambassador to Harare, Oleg Scherbak, also declined to respond to the same questions from Mineweb. According to the Zimbabwe media, he reportedly said: “These investors have various business interests ranging from transport, power and mining to tourism, telecommunications and agriculture. Russian journalists will meet local journalists from various media houses and will have an opportunity to share and exchange ideas.”

In Moscow, Panchenko's company is so small, it is unknown to the major aircraft builders located at Zhukovskiy, the Moscow suburban aviation centre. Sources at Renova, the Russian mining group most active in southern Africa, said RusAviaTrade is unknown. Renova owns an unrelated company called RusAviaAuto; this is a bus operator at a small airport Renova owns. Russian Aviation Company (RusAvia) told Mineweb that, despite the similarity in name, it has never heard of RusAviaTrade.

RusAvia says it operates only within Russia, repairing World War II-vintage aircraft, and publishing books and magazines for Russian plane enthusiasts. A company source said RusAvia has a representative in India, but it has never been in Zimbabwe.

RusAviaTrade has no website, and two telephones listed at its identified office do not work. The company has been identified through the Russian Center of Small Aviation Omega, where officials confirmed that RusAviaTrade is their subsidiary. Omega says it operates small aircraft for joyrides around the Moscow region. It also claims to sell Cessna, Piper, and Beechcraft imports, and to enable novice Russian fliers to attend local and European flying schools and receive European pilot accreditation. "Flying with us," Omega's website declares, "you become the pilot of a private plane. You will get acquainted with very interesting people, the surprisingly fine world of aircraft, and you will expand your horizons." Noone at RusAviaTrade could explain how Zimbabwe has suddenly appeared on the investment horizon. Panchenko was uncontactable.

The Russian Foreign Ministry told Mineweb it has no information on the delegation's visit to Zimbabwe, or its outcome.

The zealousness with which Zimbabwe government officials have pursued the appearance of international investment has led to Russian embarrassment before. In July 2003, a burst of local publicity surrounding the visit of a group of Russian corporate executives led to an embarassed announcement that there was no Russian intention to buy into Zimplats. A year later, fresh evidence indicated that that intention was under discussion at the time in Harare.

The categorical Russian denial followed a report in the Zimbabwe Herald, claiming that three officials of Norilsk Nickel had visited Zimbabwe a few days earlier, and met with executives of Zimplats to discuss a Russian interest in the company. Norilsk Nickel, Russia's leading mining company, is a natural rival of South African producers of platinum and palladium, and the news triggered special interest in Johannesburg. According to the Herald report, the meeting had been arranged by the Russian Embassy in Harare, and the results were under review by Norilsk Nickel.

Sergei Chernitsyn, Norilsk Nickel's principal spokesman, responded at the time: "the report by the Zimbabwian newspaper is nonsense. No delegation of Norilsk Nickel was in Zimbabwe."

Dmitri Suslov, who was then in charge of the Russian Embassy in Harare, told Mineweb the embassy had helped arrange a meeting with Zimplats for a recent group of Russian visitors, but he said there were no representatives of Norilsk Nickel in the group. According to Suslov, the group included Vladimir Shubin, an academic from the Moscow-based Institute of Africa, who had stopped in Harare after visiting South Africa. Suslov said the visit may have been exaggerated in the Zimbabwean media to counteract negative reports about business conditions in Zimbabwe in the western press. "The visit was not officially prepared," Suslov said, "and the embassy was not warned about it in advance." He said he does not know what the results were of the visit.

At the time, a source close to Norilsk Nickel claimed that, following the completion of its acquisition of US palladium producer, Stillwater Mining Company, Norilsk Nickel was not in the market for further foreign acquisitions. Nine months later, in March 2004, Norilsk Nickel bought Anglo American's 20% stake in Gold Fields for $1.16 billion.

What was not known until some time after the July 2003 visit to Zimbabwe was that among the Russian visitors at the time, was Andrei Dubina, the South Africa-based lobbyist and business scout for the owners of Norilsk Nickel, Vladimir Potanin and Mikhail Prokhorov. Dubina had set up a Johannesburg office with an associate, Artem Grigoryan, and they prepared the ground for the Gold Fields bid.

At the time, their role was so secret in Moscow, senior executives at Potanin's holding company Interros, and at Norilsk Nickel, claimed to know nothing about it. On the other hand, in South Africa, Dubina introduced himself to international and South African corporate sources as advising Norilsk Nickel and Interros.

The attempted Russian takeover of Gold Fields was subsequently abandoned, and the prime mover at Norilsk Nickel, Leonid Rozhetskin, was ousted from the company in January 2005. This week, Moscow prosecutors told Mineweb they have issued an international warrant for his arrest in relation to another investment operation. The prosecutors added they do not know where Rozhetskin is now living abroad. Grigoryan currently sits on the Gold Fields board of directors.

Source: www.mineweb.net/african_renaissance/292940.htm