HomeCommentEric Bloch Column

Eric Bloch Column

Casting the mantle of blame upon others

BASED upon reports in the state-owned press, it must be assumed that Zimbabwe’s president continues to be surrounded by ministers, advisors and others who grossly misinform him as to the economic realties of the countr

y which he leads, and of the countries which they clearly perceive to be Zimbabwe’s enemies.

Those reports related to an address by President Mugabe to a gathering of Zimbabwean ambassadors, which address reveals major misconceptions of the causes of Zimbabwe’s economic ills. As even the president’s opponents and critics acknowledged his renowned intellect, the greatly erroneous perceptions and perspectives that characterised his address can only be credibly attributed to his being the victim of extensive, ongoing, misinformation and disinformation. The misrepresentations to him of facts and their causes are pronounced and very wide-ranging, albeit that there are also indications that on occasion (although probably infrequently) he is correctly informed. That is presumably because on such rare occasions, it suits the agenda of the misinformants to recount certain facts.

One of those exceptions is the recognition of the very significant achievements of the governor of the Reserve Bank of Zimbabwe (RBZ), Gideon Gono, in his first year in office.

However, the president has been given a totally different impression of the previous governor of RBZ, Leonard Tsumba. Unjustifiably, he blames Tsumba for much of the economic morass that has been Zimbabwe’s increasing lot since late 1997. The president alleges that Tsumba “believed in textbook economics rather than practical solutions to the country’s economic challenges”, and stated “Government had difficulties working with Tsumba because he was Western-oriented and orthodox.”

One must ponder why, if government had such difficulty in working with Tsumba, it accorded Tsumba a second five-year term in office? Was government so masochistic that, when it had the opportunity of ridding itself of someone it (allegedly) could not work with, at the end of his first term, that it gave him another term? Surely not? The reality must have been government’s then satisfaction with him.

One must also ponder why, for four of the first five years of Tsumba’s reign as governor, the Zimbabwean economy enjoyed steadily increasing growth. It was attracting foreign and domestic investment, unemployment was reducing, inflation was falling, exchange rate stability was developed, and much else. President Mugabe’s attack on Tsumba implies that the economic growth was despite Tsumba. In reality, the economic recovery experienced from 1994 to mid-1997 was attributable to many different acts and causes. Some of those actions were initiated by RBZ at the very time Tsumba was governor.

The president also contended that whilst Tsumba was in office “banks and other financial institutions engaged in all sorts of unscrupulous activities such as under-invoicing of export earnings”, and that “supervision of the financial sector was poor”. Certainly there was a plethora of unscrupulous activities in the financial sector, although under- invoicing was the action of certain exporters, and not of financial institutions, for they do not issue export invoices.

Equally, supervision of the financial sector was abysmal, but not recognised in the presidential statement was that the authority and power of supervision of financial institutions was very limited in the hands of RBZ at that time, such authority and power having vested mainly in the Registrar of Banks and Financial Institutions within the domain of then Minister of Finance and Economic Development. Fortunately, when Gono came into office, RBZ was given markedly greater monitoring and surveillance authority.

The diplomats were informed by the president that the economic decline was due to the “textbook” and “orthodox” monetary policies prevailing during Tsumba’s reign, coupled with “high inflation, illegal economic sanctions imposed on the country by some Western countries led by Britain, fuel shortages and successive droughts”. It is appalling to note how massively the president’s ministers and advisors must have deliberately misled him.

Very often “textbook” and “orthodox” policies are the best to remedy a distressed situation, for they can be very effective. This has been evidenced on countless occasions, including the remarkable economic turnaround of South Africa post the apartheid era, the dramatic and very rapid recovery a few years ago of the Mexican economy, the spectacular economic upturn of Mauritius in the mid-1980s, to cite but a few of the many economies that have benefited from tried and proven “textbook” and “orthodox” measures.

But it’s time that Zimbabwe stopped deluding itself as to the origins of its economic woes. Contentions that a major catalyst of the economic ills is the imposition of “illegal” sanctions are devoid of substance. The only sanctions imposed upon Zimbabwe (by the European Union, including Britain, and some Commonwealth countries) are sanctions targeted at specific individuals, the first and foremost being the president and the government hierarchy. Those sanctions restrict such persons’ travel, and access to their assets situated in those countries.

In addition, many donor states have reduced or halted support, but Zimbabwe has been the trigger of the withholding of donor support, by its frequent, vitriolic outbursts against the donors, and through promulgation of non-democratic, inequitable and unjust legislation such as Posa, Aippa and the NGO Bill. And there was, and is, nothing illegal in the application of targeted sanctions.

By far one of the greatest causes of Zimbabwe’s near self-destruction of its economy was the disastrously implemented programme of land acquisition, redistribution and resettlement instead of pursuing a constructive, racially and internationally cooperative, merit-based, programme. That shattered the very foundations of the economy.

Of almost equal negative economic consequences was the foolhardy, profligate, irresponsible payout to war veterans (actual and pseudo), to an extent far beyond the means of government.

The third significant cause of the catastrophic collapse of the economy was government’s immensely excessive spending, at levels markedly greater than its revenues. Such expenditure is on the operations of the Presidency and the Cabinet, so-called Defence, Foreign Affairs (the president suggests that Zimbabwe needs many more embassies, and yet it cannot even pay its present diplomats timeously), on a Ministry of Information which does not fulfil its mandate, on a Ministry of Justice which mainly crafts despotic and draconian legislation, on a Ministry of Education, Sport and Culture which lowers Zimbabwe’s education standards, and much equally
wasteful and unaffordable fiscal outflows.

Another major cause of the Zimbabwean economic malaise is the ongoing alienation of most of the international community. Zimbabwe regularly disparages the very international institutions which could give it desperately need balance of payments support.

Previous articleEric Bloch Column
Next articleMuckraker

Recent Posts

Stories you will enjoy

Recommended reading

You have successfully subscribed to the newsletter

There was an error while trying to send your request. Please try again.

NewsDay Zimbabwe will use the information you provide on this form to be in touch with you and to provide updates and marketing.