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By
Nobuhle Nyathi
TAWANDA Hondora,
writing from Warwick University
asks: “What has caused Zimbabwe’s once stable economy to
so spectacularly collapse?”
In his wisdom or lack of it, he then spectacularly comes to the conclusion that the main reason why Zimbabwe’s economy is in a mess is because of economic sanctions imposed by US, the EU and Australia.
In another article written two weeks earlier, Dr Alex Magaisa also previously at Warwick University, suggested that the reason why Zimbabwe was having economic problems was largely because of the targeted sanctions on Zanu PF officials. Far be it for me to speculate what exactly it is that they smoke at the University of Warwick, but whatever it is, it dilutes their thinking and afflicts them with serious amnesia.
The arguments advanced by these two gentlemen are not only unsound, but they are patently false as they create the misleading impression that if the so-called sanctions are removed then Zimbabwe will be a better country.
To be sure I oppose smart sanctions because I believe that wicked as they are, the ministers and Zanu PF members of parliament should still be allowed freedom of movement. They should be allowed opportunities and spaces to articulate their case even though the same spaces are shut out for those not singing from the Zanu PF hymn book in Zimbabwe.
According to Hondora, “The US introduced economic sanctions on Zimbabwe through the Zimbabwe Democracy and Economic Recovery Act, 2001."
The impression created here is that Zimbabwe’s economic problems started with the introduction of this Act in 2001. Yet even those with a pedestrian understanding of economics will tell you that Zimbabwe’s government refused to listen to wise counsel and imposed the Economic Structural Adjustment Programme in the late 80s. We were told to tighten our belts as the chefs were eating on our behalf.
In 1997, President Robert Mugabe’s government paid unbudgeted amounts to War Veterans. This led to the plunge of the Zimbabwean dollar. And then there was the misadventure in the Democratic Republic of Congo. It is simply not true to argue as Hondora argues that “What Mugabe has done is to mismanage the endemic crisis caused by the country’s inability to access capital, which in turn are the result of a raft of economic sanctions in place against the country.”
The problems leading to the payment of war veterans had nothing to do with Zimbabwe failing to access capital. It is important to note here that through the War Victims and Compensation Fund, Zanu PF officials had claimed disability. Amazing scenes were witnessed where Zanu PF functionaries, some of them with cabinet positions were claiming 90% disability. The Emmerson Mnangagwa's, the John Nkomo’s and a host of other ministers claimed disability and were given thousands of dollars (a lot of money then). While this was happening, ordinary war veterans were wallowing in poverty. They couldn’t feed their families and were leading a hand-to-mouth existence. The war veterans decided they now wanted a piece of the cake. They had had enough and refused to listen to the ‘tighten your belt sermons’ coming from the church of Gluttony. After demonstrations that threatened to tear apart Zanu PF the war veterans were paid using unbudgeted money.
| "My beef with Hondora is his starting point that the problems that we have in Zimbabwe are largely because of economic sanctions. This is simply not true" |
| NOBUHLE NYATHI |
It must be pointed out here that war veterans had never said they wanted to be paid for liberating the country. The demonstrations they made and the money they now demanded emanated from the fact that while the great majority of them were leading pitiful lives, ministers and senior government officials who were already getting huge salaries were also getting extra amounts by looting the War Victims Compensation Fund. Imagine the obscenity of the whole arrangement – living a luxurious life with your family, having a government salary and forex allowances for the monthly international trips. You then proceed to claim 90% disability and are given more money. I am just an ordinary war veteran, struggling to raise school fees for my children and am on wheel chair and you are telling me to tighten my belt!
Hondora seems to be under the illusion that Zimbabwe’s problem stems from the fact that the country cannot access loans because the US blocks such applications even in the African Development Bank. This is false. ADB continues to lend Zimbabwe money. Infact, Hondora should find out how much Zimbabwe has been given by the ADB since the Zimbabwe Democracy and Economic Recovery Act was passed in 2001. As we speak right now, South Africa stands ready to lend money to Zimbabwe. So it’s certainly not about Zimbabwe failing to access loans.
Just this month alone over $200 billion dollars of money was lost at the stock exchange because of government’s plans to introduce capital gains withholding tax. Companies are also worried that although the central bank retains 50 percent of foreign currency proceeds from their exports, they are not able to get this money when they want to buy inputs. What stops companies from investing in a country has very little to do with whether that country can access lines of credit, it has very little to do with whether officials of that country are under smart sanctions or not. US, EU and Australian companies can be found in China, Russia and Libya despite the questionable democratic credentials of those countries. It has everything to do with the business environment in that country and the prospect of profits. In Zimbabwe you have a situation where the government believes that industry owes it a living. Why should companies have to beg to use their 50% percent that is retained by the bank?
It is Zanu PF’s system of patronage that has killed the country. The politics of accommodation and pure vindictiveness is what has led us to where we are today. This idea that people can reap where they have not sown is what has led us to this mess. This idea that laws can be created to deal with certain individuals (Look at what has happened to James Makamba, Mutumwa Mawere) in mind. The sheer arrogance of having a constitution that stops people from taking their case to the courts (never mind the fact that bench is dominated by Zanu PF sympathisers). Add this to the policy flip-flops and dearth of direction that epitomises Zanu PF and you have an undermined economy. There is no workable economic blue print in Zimbabwe. What exactly is our economic programme? Are we following the Millennium Economic Recovery Programe or the National Economic Revival Programme? Is it still Zimprest or we are now moving Towards Sustained Economic Growth? Who exactly is in charge of Zimbabwe’s economic programme and how rational is their thinking?
Can Hondora explain why it is that he thinks that the first and foremost way of getting foreign currency is by getting loans from IMF and World Bank. And while he is still at it, he must tell us where our friend Cuba that cut ranks with the IMF in the 1960s is getting its forex from. He must tell us why in Cuba there is no shortage of salt. I dare him to tell us that the reason why Cuba’s economy is stable is because it is trading well with the EU, the US and Australia.
The suffering being experienced by the people of Zimbabwe is largely the fault of Zanu PF. The ruining party is utterly clueless on how to pull the economy out of the gutter. The few Zanu PF officials who have a clue simply don’t care as they are preoccupied with positioning themselves in the succession equation. How do you explain the fact that the United Nations cannot start assisting Zimbabwe’s victims of operation Murambatswina simply because the government does not agree on the text of the document explaining how the assistance will come? I mean people are dying and the government is arguing over full stops and comas. To add insult to injury you have a whole President telling the world that there is no hunger in Zimbabwe. People have rice and potatoes but they don’t want to eat these because they are used to sadza!
My beef with Hondora
is his starting point that the problems that we have in Zimbabwe are
largely because of economic sanctions. This is simply not true. Our
problems are largely because of Zanu PF’s intransigence and pettiness.
They are largely because of Zanu PF’s policy inconsistencies.
They are a result of Zanu PF’s succession battles. Thst is the
starting point. No amount of theorising and academic posturing can change.
Nobuhle Nyathi is a Zimbabwean writing from Bulawayo. She can be
contacted at: nyathinobuhle@yahoo.co.uk
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