A blue­print for eco­nomic trans­for­ma­tion

The Sunday Mail (Zimbabwe) - - OPINION & ANALYSIS -

of a com­mu­nity with the av­er­age work­ers and cit­i­zens of so­ci­ety.”

Vi­sion 2030, there­fore, fore­casts a mod­er­ately pros­per­ous so­ci­ety.

On the other hand, the MDC-Al­liance man­i­festo, dubbed Sus­tain­able and Mod­erni­sa­tion Agenda for Real Trans­for­ma­tion, en­vi­sioned a $100 bil­lion economy by 2029, which was sup­posed to be achieved through an­nual growth rates of 10 per­cent per an­num.

The MDC-Al­liance also wanted to join the Rand Mone­tary Union and give ti­tle deeds to new farm­ers, in­clud­ing full com­pen­sa­tion for white farm­ers.

There was also a pitch to get debt re­lief through sound eco­nomic man­age­ment.

The point must be made that some of the sub­stance of Smart ap­pears to have been de­rived from Zim-As­set, which is not sur­pris­ing given that some of the char­ac­ters in the Al­liance had pre­vi­ously ex­pressed ad­mi­ra­tion of the pol­icy.

How­ever, I am not sure how they came up with the tar­geted $100 bil­lion economy, since this is math­e­mat­i­cally im­pos­si­ble, even if the economy — whose GDP cur­rently stands at $18 bil­lion — grows at 10 per­cent an­nu­ally.

A more prudent es­ti­mate would be be­tween $50 bil­lion and $65 bil­lion, un­less the un­der­ly­ing as­sump­tion is that the $18 bil­lion is un­der­stated.

We call this blue­print Zim-As­set II.

In the event that the coun­try has gen­er­ated suf­fi­cient con­di­tions to in­tro­duce its own lo­cal unit, I sug­gest the lo­cal cur­rency should be named af­ter one of the coun­try’s found­ing fa­thers — dead or alive — ei­ther from the First Chimurenga or Sec­ond Chimurenga.

Or it can be named af­ter one of our pre­cious min­er­als or rich min­eral belts. For ex­am­ple, Great Dyke, just like the Rand in South Africa.

The new cur­rency should be backed by one or a com­bi­na­tion of the coun­try’s pre­cious min­er­als such as gold, plat­inum and di­a­monds so that it doesn’t suf­fer the same fate as the Zim­babwe dol­lar.

I would ad­vise that back­ing the cur­rency with gold would be ideal.

I don’t be­lieve that we should im­pose un­nec­es­sar­ily con­di­tions for our­selves to adopt a new cur­rency.

I am, now more than ever, con­vinced that dur­ing the sub­sis­tence of the 10-year plan, we will be able to achieve that we which sought to achieve.

Since the ad­vent of the New Dis­pen­sa­tion in Novem­ber last, the coun­try has been able to record in­vest­ment com­mit­ments of more than $20 bil­lion, in­clud­ing from for­mer hos­tile coun­tries.

But what is most pleas­ing is the suc­cess­ful el­e­va­tion of re­la­tions be­tween China and Zim­babwe from “all­weather” sta­tus to a “com­pre­hen­sive strate­gic part­ner­ship” af­ter Pres­i­dent Mnan­gagwa’s State visit in April this year.

Sino-Zim re­la­tions date back to the mid-1850s.

This po­si­tion­ing and change in re­la­tion­ship is both timely and ap­pro­pri­ate, and is no mean feat.

There are three dif­fer­ent types of bi­lat­eral or mul­ti­lat­eral re­la­tion­ships that ex­ist be­tween na­tions and these are: Part­ner­ships; Al­liances and Non-Al­liances; as well as Non-Part­ner­ships.

China, as the sec­ond-big­gest economy in the world af­ter the US, is now a global eco­nomic gi­ant, but even then it still en­joys a $500 bil­lion trade sur­plus with the US.

Be­low, in or­der of im­por­tance, are the re­la­tions China en­joys with other coun­tries: 1. All-Round Strate­gic Part­ner­ship; 2. Com­pre­hen­sive Strate­gic Co-op­er­a­tive Part­ner­ship;

3. Com­pre­hen­sive Strate­gic Part­ner­ship;

4. Strate­gic Co-op­er­a­tive Part­ner­ship; 5. Strate­gic Part­ner­ship; 6. All-Round Friendly Co-op­er­a­tive Part­ner­ship;

7. Com­pre­hen­sive Friendly Co-op­er­a­tive Re­la­tion­ship;

8. Com­pre­hen­sive Co-op­er­a­tive Re­la­tion­ship;

9. Friendly Co-op­er­a­tive Part­ner­ship; 10 Friendly Part­ner­ship; and 11 Non- Part­ner­ship Re­la­tion­ship. Since Zim­babwe won In­de­pen­dence in 1980, our diplo­matic re­la­tions were ranked at level 10 but we have now leapt to level 3.

This means bi­lat­eral co-op­er­a­tion be­tween the two coun­tries is now wide-rang­ing and multi-lay­ered.

It cov­ers eco­nomic, sci­en­tific, tech­no­log­i­cal, po­lit­i­cal and cul­tural fields.

By “strate­gic” it means co­op­er­a­tion should be long-term and sta­ble, tran­scend­ing dif­fer­ences in ide­ol­ogy and so­cial sys­tems.

By “part­ner­ship” it means that the co­op­er­a­tion should be on an equal foot­ing and mu­tu­ally ben­e­fi­cial.

South Africa (2010), Al­ge­ria (2014) and Egypt (2016) en­joy the same com­pre­hen­sive strate­gic part­ner­ship with China.

Over­all, 22 coun­tries in the world en­joy the same re­la­tion­ship, and these in­clude coun­tries such as Rus­sia, France, UK, Spain and Greece, among oth­ers.

China can only be ig­nored by those who do not un­der­stand the global busi­ness ma­trix. For ex­am­ple, those in our lo­cal op­po­si­tion ranks.

As re­cent as this year, MDC-Al­liance pres­i­dent Mr Nel­son Chamisa made un­char­i­ta­ble com­ments towards China.

This is un­wise, out­ra­geous and im­ma­ture, if you ask me.

Some of his part­ners in the Al­liance are al­ready known for their ill-ad­vised, per­sis­tent and strong anti-China rhetoric.

Con­sid­er­ing China’s sta­tus, it is im­por­tant to do busi­ness with China.

Con­sid­er­ing that China’s to­tal bank as­sets stand at $40 tril­lion, while to­tal bank de­posits are at $27 tril­lion, it pro- vides scope for lo­cal banks to form strate­gic part­ner­ships with them.

So, Zim­babwe can lever­age on its re­la­tion­ship with China in or­der to achieve mid­dle-in­come sta­tus.

En­gage­ment and re-en­gage­ment will, there­fore, be key.

In any case, Zim­babwe can al­ways look to the China for in­spi­ra­tion in its en­deav­our to record sus­tained dou­ble-digit growth.

Closer to home, in Africa, An­gola at one time af­ter the end of its civil war be­tween MPLA and Western-backed Unita, al­most be­came a very good ex­am­ple worth em­u­lat­ing.

How­ever, the sharp drop in oil prices put brakes on eco­nomic growth.

Thank God, oil prices are now re­cov­er­ing.

Over­all, the pil­lars and or drivers of Zim­babwe’s en­vis­aged eco­nomic growth in the next 10 years, like in the past, will con­tinue to be agri­cul­ture, min­ing, tourism and man­u­fac­tur­ing.

Al­ready, agri­cul­ture em­ploys more than half the pop­u­la­tion, con­trib­utes 25 per­cent in ex­port re­ceipts, in­clud­ing 60 per­cent raw ma­te­ri­als to the man­u­fac­tur­ing sec­tor.

It cur­rently con­trib­utes be­tween 11 per­cent to 16 per­cent to GDP.

The con­tri­bu­tion of the sec­tor to the economy is likely to im­prove given in­creased to­bacco out­put, which rose from 58,5 mil­lion kg in 2010 to sur­pass the cur­rent record 240 mil­lion kg. To­bacco ex­ports are also ex­pected to rise to $1 bil­lion this year.

In my view, Zim­babwe has po­ten­tial to pro­duce over 365 mil­lion kg per sea­son with more sup­port to farm­ers.

Again, the ten­dency and prac­tice has been to rely on Chi­nese in­vestors.

Com­mand Agri­cul­ture is al­ready prov­ing its worth and value in gold.

Our si­los are rea­son­ably stocked with our sta­ple food maize stocks and rea­son­able de­liv­er­ies are ex­pected; in fact, they have started ar­riv­ing at our de­pots.

There are pos­i­tive spin offs such as food se­cu­rity, em­ploy­ment cre­ation and so­cio-eco­nomic gains that can be de­rived from agri­cul­ture.

Zim-As­set II, how­ever, has to strive to build dams and water reser­voirs, ac­quire of ir­ri­ga­tion equip­ment in or­der to re­duce de­pen­dence on rain­fed agri­cul­ture, in­clud­ing in­creas­ing yields.

Like­wise, min­ing pro­duc­tion fig­ures so far this year are pleas­ing and en­cour­ag­ing, es­pe­cially for gold, plat­inum, coal and di­a­monds.

Gold out­put is fore­cast to rise to 30 tonnes this year, while di­a­mond pro­duc­tion is ex­pected to reach 4,6 mil­lion carats.

No doubt, lithium will also be a game-changer, given ris­ing global de­mand.

The min­eral has be­gun to be called “white pe­tro­leum”.

The ex­pected re­vival of Zis­cos­teel may have a pos­i­tive im­pact on the iron, steel and chrome in­dus­try.

In ad­di­tion, the in­flux of tourists, es­pe­cially af­ter the up­grade of Vic­to­ria Falls In­ter­na­tional Air­port, more than jus­ti­fies the in­vest­ment into these projects.

The up­grade of the Robert Gabriel Mu­gabe In­ter­na­tional Air­port is now un­der­way, and there are also plans to up­grade smaller air­ports in Masvingo (Buf­falo Range), Mutare, Beit­bridge and Kariba.

Tourist ar­rival fig­ures in­creased from 2 mil­lion in 2016 to 2,2 mil­lion in 2017 and in­di­ca­tions point to even more growth this year.

Ca­pac­ity util­i­sa­tion in in­dus­try has also shot up to 50 per­cent.

Fi­nanc­ing for nec­es­sary re­tool­ing and mod­ernising is ex­pected to come from in­creased in­flows of FDI.

Ser­vice in­dus­tries such as ICT, bank­ing and fi­nance are also ex­pected to grow.

I will also sub­mit that build­ing, re­pair­ing and main­tain­ing en­abling in­fra­struc­ture is key to achiev­ing the set goals un­der Zim-As­set II.

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