Zim­babwe in fo­cus

Finweek English Edition - - Creating Wealth -

WHILE MANY

ex­ter­nal ob­servers are yet to see any pos­i­tive changes in Zim­babwe since the Gov­ern­ment of Na­tional Unity ( GNU) took power in Fe­bru­ary 2009, some in­ter­nal ob­servers be­lieve that there is some cause for hope.

Speak­ing at a re­cent fo­rum at the Uni­ver­sity of Pre­to­ria’s Gor­don In­sti­tute of Busi­ness Sci­ence, MDC Se­na­tor David Coltart ex­plained that al­though he be­lieves that the pow­er­shar­ing agree­ment upon which the GNU is based is flawed, there was no other re­al­is­tic way of mov­ing the coun­try for­ward in a non­vi­o­lent man­ner. He hopes that the lack of in­volve­ment by the in­ter­na­tional com­mu­nity at the time of the ne­go­ti­a­tions will change and that they will en­gage with Zim­babwe in the not-too-dis­tant fu­ture, al­though the cur­rent global eco­nomic cli­mate has meant an in­evitable re­align­ment of so­cial, eco­nomic and po­lit­i­cal poli­cies around the world.

Coltart ar­gues that al­though the MDC should have been given more power hav­ing won the ma­jor­ity of the vote in the last elec­tions, that their con­trol of ser­vice port­fo­lios in the cab­i­net is pos­i­tive for the Zim­bab­wean peo­ple, as that gives the MDC ac­cess to the masses and al­lows them to make a mean­ing­ful con­tri­bu­tion to the coun­try. Coltart is pos­i­tive about the Zim­bab­wean peo­ple’s com­mit­ment to peace­ful change, and while he ac­knowl­edges that quicker re­forms were ex­pected, he be­lieves that there is a “new mood” in the coun­try and that ten­sions eased in the past year.

The grad­ual re­lax­ation of me­dia re­stric­tions is also a cause for hope, says Coltart, as is the de­sire of many in the cab­i­net across the po­lit­i­cal spec­trum who “...in some re­spects have the abil­ity to work to­gether in non-con­tentious ar­eas and are get­ting things done.”

The path that Zim­babwe is trav­el­ling down can­not be re­versed, says Coltart, and as lives start to be im­proved he hopes that the recog­ni­tion that “democrats are try­ing to do the right thing and act in the best in­ter­ests of the peo­ple” will spread.

Coltart is re­al­is­tic that this road will be a long and ar­du­ous one, how­ever. As a hu­man rights lawyer who now finds him­self as the Min­is­ter for Ed­u­ca­tion, he was hor­ri­fied to dis­cover that there are an av­er­age of 15 pupils to each text­book in the coun­try, and that his Min­istry takes up to three weeks to dis­trib­ute poli­cies to schools as they do not have a pho­to­copy ma­chine.

Coltart is not naïve, how­ever, and crit­i­cises his own party for not seiz­ing op­por­tu­ni­ties that have been pre­sented to them. This, cou­pled with a lack of ex­per­tise in gov­ern­ment, his own in­cluded, slows pro­cesses and hin­ders de­vel­op­ment. West­ern scep­ti­cism is an­other ma­jor con­cern for Coltart, who has been lob­by­ing the World Bank, the IMF, the US and the EU for fund­ing, only to be turned down due to the on­go­ing farm in­va­sions and the con­tin­ued de­tain­ment of po­lit­i­cal ac­tivists.

Tony Hawkins, a Pro­fes­sor of Eco­nomics at the Zim­bab­wean Grad­u­ate School of Man­age­ment does see some light at the end of the tun­nel, but cau­tions that a great deal of as­sis­tance will be needed from the in­ter­na­tional com­mu­nity, cou­pled with the im­ple­men­ta­tion of strong poli­cies by the gov­ern­ment if real eco­nomic progress is to be made. In 2008, Zim­babwe’s GDP fell by 14%, inflation reached the quadrillions, the lo­cal cur­rency was dol­larised and over one half of the coun­try’s for­mal sec­tor jobs were lost. This left in­come lev­els on a par with those of the 1950s and three­quar­ters of the pop­u­la­tion liv­ing on less than a dol­lar a day.

Hawkins be­lieves that the com­pany needs “a new busi­ness model”, as well as a new gov­ern­ment which can “make de­ci­sions to­gether”. Pub­lic ser­vices are weak, the coun­try can­not pay re­gion­ally rel­a­tive wages, which has meant a brain drain, the bank­ing sys­tem has been dam­aged by a lack of cap­i­tal, there is a se­vere cur­rency short­age, food short­ages are be­ing felt na­tion­wide, ex­ports are down and there is for­eign debt amount­ing to US$6 bil­lion. Given that there is a global eco­nomic cri­sis and the gov­ern­ment can­not see eye to eye on many is­sues, Hawkins be­lieves that Zim­babwe will only see growth of 2,5% this year.

Ad­di­tional con­cerns in­clude that pub­lic ser­vices are un­der-funded and un­der­re­sourced, which is not con­ducive to eco­nomic re­form. The in­ter­nal squab­bling about perks such as lux­ury cars is dis­ap­point­ing for Hawkins, par­tic­u­larly given the debt over­hang the coun­try is bur­dened with. “Loose talk” about mov­ing back to the Zim­bab­wean dol­lar could also be dam­ag­ing, and “must be put off for a long time”, as it is ex­tremely dif­fi­cult to make the tran­si­tion back from dol­lar­i­sa­tion he ex­plains.

Should the gov­ern­ment make “the right de­ci­sion” to pri­va­tise the re-build­ing of the coun­try’s in­fra­struc­ture, that would make the process a great deal smoother, says Hawkins, how­ever he be­lieves that this is un­likely given the gov­ern­ment’s short-term plan of “in­di­geni­sa­tion”. Hawkins won­ders how this will be done given the gov­ern­ment’s lack of cap­i­tal cou­pled with the lack of skills in the coun­try. For Hawkins, how­ever, the most se­ri­ous con­cern is the de­struc­tion of in­sti­tu­tions that has taken place, in­clud­ing health, ed­u­ca­tion, me­dia, rule of law, po­lice ser­vices and the civil ser­vice. He ar­gues that it will take years for th­ese to be re­gen­er­ated to any mean­ing­ful level.

Given all of his neg­a­tive sen­ti­ment, how­ever, Hawkins be­lieves that there should be re­cov­ery in man­u­fac­tur­ing, min­ing and tourism, and that the IMF’s es­ti­ma­tion of 6% growth in 2010, while “at the up­per end”, is not un­re­al­is­tic. He does note how­ever that it would take 12 years of 6% growth to get back to where the coun­try was in 1998.

Says Hawkins, “ There is no sil­ver bul­let. Re­cov­ery will come slowly now, ac­cel­er­at­ing next year. We need to adopt the ‘big bang’ ap­proach that China took in 1978. Zim­babwe needs to change the sys­tem and open the door.”

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