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Updated Feb 6, 2020

Multinational commodities trader Trafigura has severed ties with a Zimbabwean fuel magnate embroiled in a scandal involving the looting of state resources under President Emmerson Mnangagwa. Trafigura announced on Wednesday, February 4, that it had established total control over its fuel supply business in Zimbabwe after buying out the majority stake in Trafigura Zimbabwe, owned by Kudakwashe Tagwirei’s Sakunda Holdings.

Tagwirei is at the heart of a state scandal, with allegations that he used close connections to the ruling ZANU-PF party to secure state contracts and access to loans in a country that is significantly cash-strapped. Trafigura did not disclose what it paid for Sakunda’s 51 percent stake.

Pressure against Sakunda and Tagwirei specifically has been growing within Zimbabwe, among ZANU-PF and the opposition, as well as from the international community. Last year, the Bank of Zimbabwe froze Sakunda’s accounts following a warning from the International Monetary Fund that hundreds of millions of dollars’ worth of state payouts to the company would trigger a currency collapse. Trafigura had previously denied that Tagwirei used his political clout to secure favorable access for the Swiss-based commodities trader to Zimbabwe’s main fuel pipeline.

Zimbabwe has been facing a protracted shortage of fuel for several months, making Trafigura a vital international partner as one of the largest providers of fuel on credit for the struggling Southern African nation. President Mnangagwa had promised reforms and an opening of the economy following a military coup in 2017 that removed long-standing dictator Robert Mugabe from power, but reforms have been slow in coming, leading to intense scrutiny of Mnangagwa allies like Tagwirei.

The ZANU-PF Youth League has called for the arrest of the “heartless” tycoon Tagwirei for the damage he has caused through state-capture schemes. Until that possibility arises, Tagwirei is continuing to expand his business empire to investments in Zimbabwean mines and the establishment of a commodities trader in Mauritius named Sotic International. Among the Sotic personnel are former employees of Trafigura and Puma. Trafigura denies any links with Sotic International.

 

https://www.ft.com/content/e6a15d62-4806-11ea-aeb3-955839e06441

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