068_Global12_InFocus_Zimbabwe

Global 13

In FocusZimbabwe  materials required in the industrial sector, the other. This led to unsustainable labour remains perhaps the most witty and articu- as well as being a consumer of a large por- wage policies, an unrealistic tax regime, es- late African leader, and in the early period tion of industrial sector output such as fer- pecially in the mining sector, draconian for- after independence, his diplomatic skills in tilisers, chemicals, stock feed, machinery, eign exchange regulations that encouraged defusing what could have been a volatile spare parts and liquid fuels. massive flight capital, and more recently, a clash between black and white led to him The devastation of the agricultural sec- confused and confusing empowerment pol- being nominated for the Nobel Peace Prize tor, as well as the political unrest and the icy that has more or less put paid to foreign and receiving a knighthood from the Queen. violence often associated with it, has led to direct investment. But 20 years later, caught in the crunch be- hundreds of thousands of able-bodied Zim- tween an obdurate community of white farm- babweans fleeing to neighbouring coun- ers and a restive movement by the former tries. As a consequence, small-scale farms The devastation of the freedom fighters and other landless, the have been neglected while commercial agricultural sector, as gloves were off and Mugabe lashed out at the farms, ‘liberated’ from whites, have more West in general and Britain in particular. often than not been mismanaged by inexpe- well as the political The upshot was the most punitive set rienced new owners. of sanctions ever imposed on any African There has been a rally of sorts since the unrest and the violence country. Mugabe’s earlier disastrous mili- setting up of an inclusive government in often associated with it, tary foray into the Democratic Republic 2009, but heavy investment is required to of Congo had already alienated the World bring the sector back to its pre-2000 per- has led to hundreds of Bank and the International Monetary Fund formance levels. (IMF) who withdrew their support, and There has been a similarly gloomy picture thousands of able-bodied when the full brunt of the sanctions, mas- for the mining sector, which at one time con- Zimbabweans fleeing to querading as ‘personal sanctions’ fell on the tributed 8 percent to the economy. Its share of country, all financial access to the outside GPD in 2008 was less than 3 percent. Between neighbouring countries world completely dried up. 1999 and 2008, the cumulative contraction of To maintain some liquidity, the central the industry amounted to 81 percent. Services bank started printing money, with the in- fared no better during the ‘lost decade’. While these were serious issues, in them- evitable result of galloping inflation. By What were the causes of the dramatic selves they would not have been fatal. Sev- the end of 2008, hyperinflation had reached ‘riches to rags’ saga of the Zimbabwean eral developing countries, including Af- the stratospheric regions of 500 billion per- economy? Several factors played a part, rican ones, have endured worse and come cent! As one Zimbabwean put it, “We are but perhaps the leading role was taken by through to register healthy growth. the only country in history with millions of the government’s schizophrenic attitude What delivered the coup de grâce was the starving billionaires.” He could have said alternating between a socialist command confrontational attitude adopted by Mugabe “trillionaires” when the country printed its economy on the one hand and a grudging in the wake of the turmoil over the land re- one trillion dollar notes. acknowledgement of the private sector on distribution. Even at the age of 88, Mugabe This was the nadir of the country’s eco- 68 lwww.global-briefing.org first quarter 2013global


Global 13
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