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Eric Bloch Column

Government bent on economic destruction

By Eric Bloch

THE extent to which the Zimbabwean government is bent on the absolute destruction of the country’s economy and thereby the total annihilation of the Zimbabwean

population, knows no boundary. For 10 years, without any let or reason, it has embarked on one economically cataclysmic measure after another. In most instances it has done so in complete disregard of the authoritative warnings given as to the dire consequences of those measures.

Without fail it has cavalierly dismissed and disregarded those warnings. So pronouncedly has it ignored or rejected all good-faith expressed concerns and cautions as to the dire consequences of its actions, actual and intended, and as contemptuously been insensitive to the never-ending catastrophes created by it, that one must inevitably believe that the utter ruination of the economy is its determined objective.

Government’s first major endeavour at economic annihilation was 10 years ago, when it succumbed to the demands and pressures of the war veterans for compensation for services rendered during the liberation struggle.

Whether or not they were deserving of compensation is irrelevant, the harsh fact is that Zimbabwe could not afford the compensation payments. This was especially so as the amount required was severely inflated by the numbers of the claimants being massively swollen by thousands who had never been engaged in that struggle.

Numerous pretenders were included as recipients of the compensation packages, including many who, when Independence was attained had not even been conceived!

The consequences of government surrendering to the demands, threats and near-blackmail of the compensation claimants included an immediate collapse in the value of the Zimbabwean dollar, it losing almost 75% of its value in a matter of hours.

That currency devaluation immediately fueled inflation because Zimbabwe is a very import-dependant country. The devaluation drove the landed costs of the imports upwards.

Although the economic prejudice was immense, it did not suffice to destruct the entirety of the economy. Government strategists cast their eyes about the economy, and recognised that agriculture was the foundation and mainstay of that economy. Determined on economic destruction, whilst seeing opportunities for major political gains, the government embarked upon an ill-conceived, ill-managed, foolhardy and apocalyptic programme of land reform.

It is indisputable that land reform was necessary and overdue, but not in a manner that almost completely destroyed agriculture, and thereby also the economy and the Zimbabwean people.

Government displaced the agriculturally skilled and productive and failed even to replace them with others with like attributes.

Instead, most of the lands of the dispossessed farmers were allocated to those in high political favour, to relatives and friends of those in power, and most lacked either the skills, or the resources, or the will, to use the lands with levels of productivity commensurate to those previously attained.

Zimbabwe’s economic foundation was rapidly severely shaken and cracked, but government dogmatically ignored that it, and its actions, were the cause thereof. Instead, it fabricated allegations that Britain had reneged on its Lancaster House undertakings, and so promulgated the allegations that the majority of the population, and much of Africa, soon unreservedly believed them.

Concurrently, it blamed adverse climatic conditions to excess, mismanaged the sourcing and timeous availability of essential agricultural inputs, and to all intents and purposes facilitated the vandalisation and destruction of much of agriculture’s infrastructure. Moreover, it failed to honour Bilateral Investment Protection Agreements, thereby destroying Zimbabwe’s international repute and creditworthiness.

As the economy’s decline intensified, government continuously assured the ongoing economic collapse by profligate spending far beyond its means, thereby fuelling inflation and compounding the accelerating economic collapse.

It reinforced those destructive actions by forcing the central bank to engage in quasi-fiscal activities, by turning a blind eye to world-eclipsing levels of corruption, by steadfast rejection of recovery-directed advices of the International Monetary Fund (IMF), World Bank, African Development Fund (ADB), and many others. Instead, it adopted an intensive confrontation campaign against them, and against all of Europe, much of the Commonwealth, USA, and others. It flaunted a “Look East” policy which yielded little, and it forfeited the support of the well-disposed international community which could have enabled restoration of economic wellbeing.

Unable to admit to its absolute culpability, it then invented the myth of “illegal international sanctions”. To such extent as sanctions exist there is nothing illegal about them, for there is no law which bars sanctions, and no law which compels trade, investment or the rendition of aid. For a period of time the populace of Zimbabwe believed the sanctions fable, but increasingly it is recognising that government is the underlying cause of Zimbabwe’s economic ills.

Therefore, to placate the aggrieved, oppressed, suffering people of Zimbabwe, whilst concurrently furthering their unadmitted intent of total economic destruction, and simultaneously fulfilling their political objectives, Zimbabwe’s government is now pursuing a policy of indigenisation and economic empowerment.

It is legislating that not less than a 51% controlling interest of all businesses operating for gain must be owned by indigenous Zimbabweans. As with the ill-fated, disastrous land reform programme, so too a programme to achieve substantial indigenous economic empowerment.

But that is not attainable by expropriating from the rich to redistribute to the poor, thereby temporarily making the poor rich, and making the rich poor. Instead, the programmes should be targeted at a dual facilitation of economic growth and development of indigenous participation therein.

Instead, government has driven a near-final nail in the coffin of both foreign direct investment and of domestic investment. None are prepared to invest when they are threatened with investment insecurity, and to the vulnerability of being subject to third party control, and even more so if there is not even assurance of just and fair compensation, or of respect for investment protection agreements.

There is grave demoralisation of the existing owners of businesses, both foreign and domestic, exacerbated by numerous confrontational and racist comments by the Zimbabwean political hierarchy, repercussing very negatively upon business operations. Furthermore, government’s timing is exceptionally inept, with a majority of existing business enterprises teetering on the precipice of collapse as a result of the hare-brained and thoughtless price controls of the last three months, the non-availability of exports, the non-availability of foreign exchange, the collapsing infrastructure of Zesa, Zinwa, NRZ and other parastatals, and much else.

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