ABOUT JOSHUA CHIGWANGWA KARUMAZONDO

Joshua is a co-founder and director of a new UK based start up ESBM-Hub (https://esbm-hub.co.uk/) which focuses on building project management skills and development for small businesses and entrepreneurs. Josh has a unique performance leadership reputation of consistency and delivering results on assigned projects, strong communication and interpersonal skills that are critical to project success working in teams and keeping stakeholders on board, always striving to exhibit precision in quality delivery on time and within budgets. A great asset in researching, planning and budget scheduling. According to Traci Schwarzenegger (2019), the most effective teamwork is nurtured when individuals harmonise their efforts and commit to work towards a common goal.

Josh was conferred a distinction and graduated with an MSc in Project Management in October 2019 and holds a BA (Hons) Admin degree both from the University of Hertfordshire. He also holds a Diploma in Public Sector Accounting from Harare Polytechnic and is a qualified member of the Association of Accounting Technicians in Zimbabwe (ZAAT). He currently works for Hertfordshire County Council as a Support Specialist since 2006. Prior to that he acquired commercial working experience with Ocado for 4 yrs as a Personal Shopper and worked for 10 years in the Public Sector in the Zimbabwe Public Service specialising in Local Government Finance and Management of Donor Funded programs with the Public Service Commission involving the Civil Service Reforms, Performance management systems and dynamics of culture change in the public service to be more responsive to the needs of the people. He holds several in-service competence training and development courses acquired over the years.

According to Raghupathy (2011) ethics and social responsibility adds a moral dimension to leadership qualities of project managers. Joshua has served his community as a Trustee of Welwyn Hatfield Ethnic Minorities Group (WHEM) between 2009 and 2010. He assisted in restructuring  WHEM from a charity sustained on public donations to a company limited by guarantee capable of generating its own revenues to sustain its operations as Kaleidoscope Enterprises Ltd. Josh is a past director and Panelist’ in 2011 of the Zimbabwe Achievers Awards (UK) a philanthropy that seeks to identify outstanding Diaspora talent, innovations and creativity in a variety of genres.Visit http://www.zimachievers.com/uk/.  He is a founder and technical strategist of the Zimbabwe Global Business and Political Issues social media networking group which seeks to nurture and develop budding entrepreneurs on LinkedIn and Facebook.

                      Started from the Bottom Now l am Here !!

With lovely daughters Vimbai and Gamu

Started from the Bottom Now l am Here !!

CONSTITUTION MAKING ROAD MAP: A CASE FOR ZIMBABWE

OPINION - A review of Zimbabwe's Constitution is now being rolled calling for the participation of all Zimbabweans in crafting a historic document for the present and future generations. The controversies about the "Kariba Draft" appeared to have been watered down in the interests of progress.

Local and donor resources have been pledged to ensure the successful implementation of the consultation exercise in Zimbabwe in the next 65 days or so. The chairperson of the Commission indicated that consultations with people in the Diaspora will also be done and interest groups have shown willingness to fund the outreach to augment the initiatives of the State. It is estimated that at least 4 million Zimbabweans are residing abroad all over the World, and hence calls for the need to ensure a clear outreach strategy is adopted that will not disenfranchise the views of the majority of these Zimbabweans.

The challenges now are on Zimbabweans in the Diaspora to pool resources and to come up with effective strategies to popularise this historic event across the World so that as many Zimbabweans as possible participate. It may therefore be prudent to establish focal points which will be within reach of the Commission to consult and gather views given the resource constraints and finite time at its disposal. It will also be ideal for diverse representative groups to begin consulting their membership and to gather critical points of discussion which seek to harness talking points peculiar to the diaspora. I believe some accreditation criteria for such groups is agreed to present views on behalf of members given the sporadic settlement and distribution patterns of Zimbabweans across the world. This consultation should capture views from as many Zimbabweans in the diaspora as possible irrespective of immigration status. As such there should be a way of ensuring that undocumented migrants’ views are taken on board, as these may be crucial in ensuring the views of the worst case scenario are taken on board. How this is done, its the Zimbabwean people who needs to decide..

It is encouraging to note that the Commission acknowledges the apolitical status with which the consultation needs to pursue, as anything short of that will seriously undermine the objectivity of the views and how they will be considered for incorporation into a final draft. The need for members of this Commission to separate themselves from the partisan perspective in pursuit of this objective cannot be overemphasised, and only time will tell if they can withstand this objectivity test. Lessons from the 1999 consultation should be an easy guide on the current initiative to contain the tendency to digress to partisan platforms. Ethical standards and remedial measures needs to be in place to redress this issue should signs of it emerge.

In my earlier deliberation on this subject, I have emphasised on the need for government to separate itself from this exercise and to play a more facilitatory role in ensuring its successful implementation. Like l said, "if a constitution is the source from which government derives its existence and power, the government cannot logically create itself” Logically, a constitution cannot be the act of a government which is to be constituted by a non-existant constitution ; something as yet to be constituted (and therefore as yet non-existent) cannot act. Having said that, it is important to appreciate that in reality, there cannot be a power vacuum in government at any one time inorder to facilitate this role, hence it has to be tackled rather as a going concern, calling on the Constitutional Commission to display maturity, objectivity and professionalism in the conduct of its business. A transparent point of last resort, ideally invested in the Praesidium needs to be invoked strategically as well to guide the sticky and volatile moments in pursuit of a common goal. This task will be challenging given the fragile and skewed nature of the GPA consultations running concurrently with this consultation. The task for the GNU negotiators should be to tackle sticky issues including the media in a manner that does spill into the work of this Commission or influence its work in any way which may render its efforts futile.

My view is that this Constitution making process takes precedence on all other matters of governance as its successful implementation will ensure a stable and tolerant Zimbabwean society. A nation built on a firm and rocky foundation will not falter during trying times, and as such the constitution should be there to guide generations with a sense of pride and belonging. It should encompass Zimbabwe's cultural unique values and ethics that will enshrine sovereign and universal appeal. The question of legitimacy of the constitution is concerned with how to make it command the loyalty and confidence of the people, thus, it must be understood and be an acceptable product of the Zimbabwean people. It needs to be put through the process of popularisation with a view to generating public interest and participation in it and an attitude that everybody has a stake in it. The ultimate product from this process should represent the views and interests of the majority of Zimbabweans to make it legitimate and should guarantee the rights and freedoms universally perceived to be fundamental.

The height of challenges obviously are on how the issues of the rule of law, the property rights and freedoms of expression are formulated. For Zimbabweans abroad, this document should give them hope, inspiration and a source of national pride, which should resonate spiritually with Zimbabwe's national colours and anthem. The key issues of dual citizenship, governance philosophy and protection of property rights will feature prominently in the Diaspora.


The history of constitution-making in Zimbabwe has witnessed self-evident tension between the need to reach a broad-based consensus in the process of constitution-making on one hand advocated by the National Constitutional Assembly (NCA) including other civil society groups, and the need to ensure that the authority of the government is not undermined on the other hand. The subjective outlook of the modus operandi of a people driven constitution is appears to a trump card for the civil society. For all intents and purposes, ‘people-driven’ in this context, means involving key stakeholders in determining the points of consultation in the drafting of the constitution. Perhaps, civil society groups need to reflect on best practises globally, to appreciate that as Zimbabweans, we have a sovereign state to preserve and that the participative role of the Civil society will always be a complimentary role to the State. Perhaps, it may be the lack of this appreciative role that has generated mutual mistrust that has underpinned the constitution-making process that resulted in the rejection of Constitution in the 2000 referendum.

Civil Society ideally exist as a plethora of pressure groups which have evolved as a third sector in corporate governance to provide an independent opinion in governance matters. Ideally, it should an oversight in the independence and professional conduct of the Constitution making commission in the discharge of its functions, in regardless of whether it is as an independent body or not. The Commission should be guided by its terms of reference and ethical code of conduct,because ultimately, its not accountable to itself. It is accountable to the people through the machinery which sets it up, which is the government ultimately. It should provide the much desired checks and balances and perpetually probe this entire process so that the Commission discharges its role satisfactorily. It is critical that as far as possible this Commission be well resourced and be manned by a full -time Secretariat, contracted or seconded for this specific task and directly reporting to the Commission for the duration of the process, so that it does rely on the State to implement its obligations. The funding of this exercise by donors ideally creates this independence for the Commission which should not rely on the whims of the machinery of government to access resources.

It is vital fur us to take a leaf from constitutional reform experiences of other countries as part of a learning experience. The South African Constitution is widely regarded as one such document we may benefit from noting that it has unique situations almost similar to our background and history. I have discussed experiences from the Nepal's constitution-making road map which we may also draw lessons from, particularly in the areas of terms of office for the parliamentarians and the Praesidium.

In conclusion, it is vital for the final document to jealously guard the rights and freedoms of its citizens, to deal with issues of corruption which have eroded the social fabric, to strengthen the independence of the judiciary, create a rationalised bureaucracy which is optimum for the needs of our country, address the issues of economic confidence and poverty alleviation among other key issues. We need to appreciate that this constitution is no ordinary law to be modified or replaced by ordinary legislative processes. It must be perceived as a higher law, authorising and governing ordinary law, and commanding adherence to constitutional precepts. While ordinary law may be adopted and altered by legislative majorities of whatever size, the adoption of this constitution and its subsequent amendment should require much more widespread participation by the citizenry, and achieves broad-based consensus. Ultimately, this should render the referendum a formality, and only time will tell.


Josh Chigwangwa writes in his personal capacity. He is the Executive Secretary of the Zimbabwe Community Groups Initiatives UK and is a Business Management student at Hertfordshire University. He worked previously in the Zimbabwe Public Service for 10 years and supported implementation of the Civil Service Reform programme in Public Finance and Administration. He can be contacted on jmchigwangwa@hotmail.com

THE HOUSING MARKETS AND HOW THEY CONTRIBUTED TO THE GLOBAL ECONOMIC CRISIS ?

"THE HOUSING MARKET IN THE US AND BRITAIN AND SUB-PRIME MORTGAGES INCLUDING THE ROLE OF SECURITASATION AND COLLATERALISED DEBT OBLIGATIONS "HOW THEY CONTRIBUTED TO THE GLOBAL ECONOMIC CRISIS?　

By Joshua Chigwangwa

The effects of the cold war have seen a new dimension in global politics and the unprecedented challenges in global co-operation and international trade leading to the historic collapse of global financial powerhouses and financial systems. The global economic crisis which began in 2007 has been linked to the rapid economic slump of major economies across the world. It suggests the crisis emanated from the Housing markets in the USA and rapidly spread to Great Britain and other parts of the World. The financial crisis of 2007-2009 has been called by leading economists the worst financial crisis since the one related to the Great Depression of the 1930s. The collapse of the global housing bubble, which peaked in the US in 2006, caused the values of securities tied to housing prices to plummet thereafter damaging financial institutions around the globe. Analysts argued and believed that the roots of the crisis could be traced directly to sub-prime lending by State entities, Fannie Mae and Freddie Mac, the US biggest underwriters of home loans among low and moderate income earners. Wikipedia also refers to Sub-prime lending as the credibility or quality of particular borrowers, who have weakened credit histories and are at greater risk of loan default than prime borrowers.


Bernanke (2009) argues that in the past 10 to 15 years, the United States and some other industrialised countries have been recipients of a great deal of foreign injections. He states that net inflows had peaked in 2006 to 1,5% of GDP, an amount equal to about US $825 billion, which resulted in a housing boom fuelled by a rapid expansion of poorly managed mortgage lending schemes. Lenders expected the house prices to continue to rise, thereby allowing borrowers to build up equity in their homes, simultaneously availing credit for refinancing easily. Regulators did not do enough to prevent poor lending, in part because loans were made by firms subject to little or no federal regulation. Banks and finance houses were lending mortgages at 5 to 10 times the annual incomes of people. They used aggressive terms and conditions without insisting on creditworthiness. Foreign investors who had invested in the real estate market in the US had to declare bankruptcy owing to massive losses. (Housing News, 2009)


Paul Krugman (2008) suggests, the housing bubble started when house prices started rising indiscriminately, as homebuyers took on mortgages they could not afford, fuelled by low interest rates and a departure from traditional banking practises which resulted in an upsurge in unsecured housing loans. Buyers were given loans requiring little or no down payment, and with no regard to creditworthiness, or ability to repay should the economy reset. He further argues that lenders came to believe that because of ever-rising home prices, borrowers in times of difficulty could either take out home equity loans to get more cash or just sell the home equity loan to pay off the mortgage. Robert J. Shiller (2008) also argues that the impact of the loose monetary policy was amplified by the large number of adjustable-rates mortgages issued after 2000, particularly to subprime borrowers. He suggests that these mortgages were more responsive than fixed-rate mortgages, to cuts induced by the US Federal Reserve, triggering a boom. Borrowers had high expectations of compensation from rapidly increasing house prices and were also thought to be able to permit them to refinance at even lower rates. 　


Paul Krugman (2008) further argues that Lenders were involved in speculative lending, as they did not hold on to loan portfolios, these were on-lent or sold on to ignorant investors, as part of Securitization. Wikipedia defines Securitisation as financial innovations in which banks essentially sell mortgages to homebuyers and distribute risk to investors through mortgage backed securities (Wikipedia, 2009b). This meant that those issuing mortgages were no longer required to hold them to maturity, by off-loading these to potential investors, allowing the banks to replenish their funds and thus enabling them to issue more loans and generating transaction fees. It is argued that this may have fuelled the bubble as it accelerated substantially prior to years leading to the crisis. Securitisation was pioneered by Fannie Mae, a State-sponsored lending agency and was traditionally confined to prime mortgages. Krugman suggests that financial innovation that made securitisation of subprime mortgages possible was the collateralised debt obligation, or CDO. CDOs offered shares in the payment from a pool of AAA rated mortgages, but saturated with dubious and unsecured mortgages. This fuelled large scale financing of subprime lending from many institutional investors, such as pension funds and local authorities, resulting in the overvaluation of housing by more than 50% prior to the crunch. In reality, this meant that properties purchased during the bubble, ended up with negative equity, triggering massive involuntary defaulting by borrowers and the collapse of the shadow banking system.　


Paul Mason (2009) suggests that this burst caused a sudden rush of speculative capital into commodities and hedge funds.ie the shadow banking system. The subsequent bursting of the commodities bubble resulted in the acute starvation in villages across the developing countries and political disorientation. Robert J. Shiller (2008) also argues that the rating agencies that pass judgement on securitized mortgages persisted in giving AAA ratings to mortgage securities that ultimately were vulnerable because they too believed that there would be no bursting of the bubble. Shiller attributes the crisis to the failure of regulators to rein in aggressive lending. He also argues that since the Depository Institutions Deregulatory and Monetary Control Act of 1980 effectively ended state usury laws, thus making it possible for Lenders to reap super profits with subprime lending by charging exorbitant interest rates to offset the costs of the inevitable defaults and foreclosures. 　


Thomas (2007) suggests that the UK was adversely affected and among major economies hit hardest, following market corrections in the US housing crisis and its impact on the global economy. A substantial number of UK companies had invested substantially in the US housing market and off-shore in Icelandic banks. The increase in mortgage defaults at the subprime end of the US market meant institutions that bought up large packages of these debts were forced to close or bail-out exposed funds. The Times-Online (2008), reports that the endemic fraud in the UK housing market also proliferated. This rampant practice led the Financial Services Authority to ban at least two mortgage brokers for submitting false applications to lenders. This followed over 200 complaints of mortgage fraud allegations by Lenders to the Financial Services Authority. 　


Green S. (2008) the HSBC Group Chairman issued a statement that the UK economy was experiencing the worst economic downturn in well over half a century. He argues that it marked the first crisis era of globalised securitisation and also marked the first just-in-time global economy as the impact of the financial crisis fed rapidly straight into the performance of the real economy. He attributes the cause of the crisis to the global financial imbalances that rose from the accelerating global shift towards emerging markets which had created a macro-economic triangle consisting of major consumer markets. Green argues that huge global savings were invested in US dollars, which kept rates low and cheap. This cheap money fuelled consumer boom and rising house prices, characterised by increased borrowing by banks and consumers, fuelling asset price bubbles in housing markets. The complexity of financial instruments had peaked beyond the capacity of experienced bankers leading to sloppy risk assessments. Finally, Green also suggests that it was the result of excessive and unchecked gearing, which resulted in over-gearing and hence dependence on wholesale funding. The eventual collapse resulted in banks crowded with assets they could neither sell nor fund, forcing huge losses on housing markets. 　


Fulcher (2009) argued that the bankruptcy of rock solid US financial Institutions such as Bear Stearns, Merrill Lynch and Lehman Brothers, Mortgage Finance corporations like Fannie Mae and Freddie Mac and Global Insurance giants such as AIG, signalled the collapse of the global finance systems. The crisis spread rapidly causing global financial panic. Banks became reluctant to lend to each other, sending liquidity shock waves through the whole economy. This hoarding of capital caused the financial system to freeze. In the UK, private sector financed capital projects came to a halt, causing despondency and spiralling unemployment. The Government was forced to rescue most of the projects as they are linked to the successful hosting of the 2012 London Olympics.　The extent of the impact of this crisis on the global economies meant that unprecedented and extraordinary responses were involuntarily required to find lasting solutions to the challenges. The US government was forced to bail out insurance giant AIG following the collapse of Lehman Brothers. The UK experienced the shock waves following the collapse of Northern Rock, forcing the bail out from Treasury to avert the collapse of the financial system. According to Sam Flemming (Daily mail 2009), the Bank of England pumped £200bn of fresh cash into financial markets and pegged rates at just 0,5% to prop up the economy. (The scale of this crisis unearthed serious flaws in the management and control of financial sectors in economies around the globe. The financial monitoring mechanisms failed to flush out the problem at its infancy stages, rendering them irrelevant and in need of major overhaul. The risk management and assessment mechanisms, including stress tests which needed reforming to address the challenges emanating from adverse outcome. Adair Turner (Mail Online, 2009) Chairman of the UK Financial Services Authority suggested that banks that are too big to fail may need stricter capital requirements than smaller rivals and was also broadly in favour of the EU proposals to tighten financial supervision across the continent.　


The overview of the global financial crisis has led Analysts, Experts and governments introspecting on the broad concept of global capitalism, as a leading philosophy in driving International trade as well as global financial reforms. Fulcher (2009) suggests that the capitalist world economy’s failures have led some to suggest that the capitalist system may be in danger of collapsing. He however, argues that the history of capitalism is littered with episodes of financial crises and economic depressions. He suggests that the complex global environment will always characterise capitalism and will continue to do so. He also suggests that global reforms require an engagement with capitalism because of its global dominance. China’s entry to the capitalist world economy, with its huge reserves of cheap labour and substitutes, has transformed global financial trade and emboldened the dominance of capitalism. Mason (2009) suggests that the challenges of finding a better model always confront us during periods of recession and financial crises. 　


Policy makers need to draw important lessons from this crisis and take bold measures to reform the global financial systems, adopt effective intelligence models and monitoring mechanisms. The need to reign in laws and sound operational global co-operation to ensure compliance is as vital as dealing with a crisis ounce it has kicked off. The ripple effects of a global financial crisis affect across nations and require global interaction and solutions for it to be effective. The initiatives taken by the G20 Nations to find lasting solutions to the crisis are commendable. (Guardian Online News 2009) US President Barrack Obama, in his speech on financial regulation, recommended a raft of measures aimed at address the challenges of the global financial crisis. He announced the setting up of the Consumer Protection Agency to act as a consumer scrutiny and strengthening of financial monitoring mechanisms. (G-20.org On-line News 2009) The G-20 communiqué further details the G-20 Framework designed to manage the transition from crisis response to stronger, more sustainable and balanced growth for global financial systems with close co-operation with the IMF, World Bank and key agencies such as the Financial Services Board. The G-20 also viewed as critical, the need to have co-operation from both developing and developed countries in adopting common approaches to tackling the crisis as well as positively reviewing capacity building mechanisms to support the efforts of developing countries.　

Bibliography

Brummer A. (2009) The Crunch. How greed and incompetence sparked the credit crisis: London, Random House Business Books.

Fulcher, J. (2009) Capitalism: A Very Short Introduction: Oxford: University Press.Krugman, P. (2008) The Return of depression Economics and the crisis of 2008: London: Penguin Books.

Shiller, R.J. (2008) The Subprime Solution. How Today’s Global Financial Crisis Happened, and What to Do about it: Oxford, UK: Princeton University Press.

Mason, P. (2009) Meltdown: The end of the age of greed. London: Verso.　

External links and further reading　

Ben S. Bernanke (2009) Chairman’s speech at the Morehouse College, Atlanta, Georgia.14 April. Available at: http://www.federalreserve.gov/newsevents/speech/bernanke20090414a.htm. Accessed on 14/11/2009.

Financial Times (2007) Equity income hit by fallout from US housing crisis. Available at: http://www.ft.com/cms/s/2/c7baea48-57e2-11dc-8c65-0000779fd2ac.html Accessed on 21/11/2009.

Housing News Live (2009) Housing News [Online] Housing Market Crush in US. Available at: http://www.housingnewslive.com/housing-market crush-in-us.php. Accessed on 2009/11/12.

HSBC Annual Review (2008) Group Chairman’s Statement. Available at: http://www.2008.annualreview.hsbc.com/chairman_statement/index.html Accessed on 21/11/2009.

The Times Online (2008) UK housing market close to collapse. Available at: http://business.timesonline.co.uk/tol/business/industry_sectors/construction_and_property/article3406268.ece Accessed on 21/11/2009

IMAGE: Predicting the Global economic crisis forecastingnet.com

Wikipedia, the free encyclopaedia (2009a) Financial crisis of 2007-2009. Available at: http://en.wikipedia.org/wiki/Financial_crisis_of_2007_&_2009. Accessed on 2009-11-14

Wikipedia, the free encyclopaedia (2009b) Financial crisis of 2007-2009. Available at: http://en.wikipedia.org/wiki/Financial_crisis_of_2007_&_2009. Accessed on 2009/11/14.

Wikipedia, the free encyclopaedia (2009c) Financial crisis of 2007-2009. Available at: http://en.wikipedia.org/wiki/Financial_crisis_of_2007_&_2009. Accessed on 2009/11/14. h

http://www.dailymail.co.uk/money/article-1194171/FSA-head-Adair-Turner-says-biggest-banks-face-tougher-regulation.html Accessed on 23/11/2009

http://www.guardian.co.uk/business/2009/sep/14/obama-speech-regulation-wall-street Accessed on 23/11/2009

http://www.g20.org/Documents/2009_communique_standrews.pdf Accessed on 24/11/2009.