The purchase by a German company of a 45 percent stake in the Premier Finance Group was hailed as a major foreign investment into Zimbabwe but it was full of inconsistencies and exposed the West’s double standards vis-à-vis doing business with people on the European Union sanctions list.

German company African Development Corporation (ADC) bought 45 percent of Premier Finance Group (PFG) in December while KMQ Enterprises of Mauritius bought another 9 percent, thus shifting ownership of the bank from locals, barely weeks before the indigenisation law came into effect.

The deal was worth US$6 million but no one raised an eyebrow, yet the German company had actually bought shares from central bank governor Gideon Gono, the man who everyone says must go to pave way for the inclusive government to function smoothly. Even proponents of indigenisation, who have vowed there is no going back, did not say a word.

Gono is still on the European Union sanctions list but the German government was mum about the deal yet only three years ago it ordered another German firm, Giesecke & Devrient GmbH of Munich, to stop supplying the Reserve Bank of Zimbabwe (RBZ) with paper for printing money in a bid to suffocate the Harare administration of President Robert Mugabe.

The German firm stopped shipment of the paper though the RBZ had paid for it. Germany’s Chancellor Angela Merkel insisted that her country would not back Zimbabwe until the country had restored property rights on confiscated farms, despite the formation of an inclusive government by Mugabe and the Movement for Democratic Change’s Morgan Tsvangirai and Arthur Mutambara who are Prime Minister and deputy Prime Minister, respectively.

Last year there was an outcry when it was announced that Swiss giant Nestle was buying milk from Mugabe’s Gushungo Dairies. Swedish company, DeLaval, was also put under the spotlight for selling dairy equipment to Mugabe.

While Gono’s name does not appear on the Premier Finance Group’s shareholder lists, he was one of the two major shareholders of the bank. Gono’s shares were held through his uncle Blazio Binio Tafirei, who had a 25 percent stake in PFG.

Tafirei has been Gono’s front in most of his private investments in Zimbabwe. He is currently the executive chairman of publishing group, Zimbabwe Publishing House (ZPH), which is wholly-owned by Gono.

French-based Africa Intelligence reported in November last year that the United Nations Children’s Fund (UNICEF) had withdrawn a multi-billion dollar deal to purchase children’s books from ZPH because of Gono’s interest in the publishing house.

Tafirei was seconded to The Financial Gazette as finance director when Gono bought the paper ostensibly to avoid any pillaging by the former owner.

The other parcel of shares in PFG was held by Norman Mataruka, head of surveillance and supervision at the RBZ. Mataruka also held 25 percent in PFG through a brother in law, Andrew Nyambiya. The balance came from some minority shareholders.

ADC chief executive Dirk Harbecke said they were allowed to violate some of the country’s laws because of their business plan which he said detailed a long term road map which will see PFG expanding into the region following consolidation in Zimbabwe.

ADC is a pan African financial services investment group which was founded and is controlled by the Altira Group, one of Germany's leading, independent asset managers with more than US$ 1 billion of assets under management. Altira Group’s shares are listed and traded on the Frankfurt Stock Exchange.

It is not clear whether ADC and KMQ Enterprises are related or not. ADC refused to talk about the deal or to comment on whether it was aware that it had bought shares from Gono. ADC spokesman Josef Schiebl said: “As a private equity investor ADC does not comment on issues related to the companies in its portfolio.”

The consolidation at PFG saw the new owners firing managing director Douglas Mamvura and 42 other workers this month. Len Steffen (62), a Dutch national, has been appointed group chief executive officer. The appointment is said to have been approved by Gono, who last week attacked the indigenisation drive as reckless.

"The last six months have seen a flood of interest in the economy from both friends and foes and we must not disturb the momentum by being reckless, inconsistent and self-contradictory with our pronouncements or with what we say or do," Gono was quoted as saying.

"You don't shoot yourself in the foot during a time of scarce capital availability and neither do you start any new wars before concluding battles of yesteryear," he added.

There has been speculation that Gono is offloading some of his equity holdings in readiness to leave because of mounting pressure for his departure from the Movement for Democratic Change as well as from organisations like the International Monetary Fund.

Reports say Gono has been offered an ambassador’s post in South Africa currently being held by Simon Khaya Moyo who is now ZANU-PF national chairman and should ideally be residing in the country.