While re-engagement with the West is gridlocked, Zimbabwe will seek to revive its “look East policy” of the Mugabe days.
However, not much will come out of it, global think tank The Economist Intelligence Unit (EIU) said.
At the turn of the millennium – when the US and EU put in place targeted sanctions on Harare – the regime of former president Robert Mugabe sought to strengthen its economic and political ties with China, which became Zimbabwe’s “all-weather friend”.
However, the relationship on the investment front has been underwhelming – and it will continue on that trajectory because of Zimbabwe’s poor credit ranking.
“Zimbabwe will seek to deepen its trade and financial relations with China. However, China will remain concerned about Zimbabwe’s repayment capacity and actual Chinese lending may well fall short of the pledged commitments,” said EIU.
China tacitly supported the November 2017 coup that brought Emmerson Mnangagwa to power.
This added to the global goodwill the new president enjoyed even from the West but the new establishment has failed to move away from the Mugabe-era socio-political policies. As such, no tangible investment has come Zimbabwe’s way.
EIU says investor confidence and a financial bailout from the IMF will be hard to come by because “relations with Western institutions remain poor and progress on reforms is slow”.
On the political front, EIU raised fears that the military could rise against President Emmerson Mnangagwa if the economy continues to fail. But because he enjoys close relations with the top brass in the army, that’s a far-fetched reality.
“If senior military figures perceive the president to be incapable of preventing economic collapse, they could move against him, although entrenched cronyism within the upper echelons of the military has cemented Mr Mnangagwa’s position,” it said.
The EIU’s forecast is that Mnangagwa will remain in power.