Twenty-five years of failure – the cost

By John Robertson

AFTER 25 years of Independence, we Zimbabweans should be feeling proud about our achievements and eager to boast about our social, economic and political progress. Sadly, we can share feeli

ngs of honest pride in very little.


If anything, the comparisons we can all make between the benefits and costs of recent events should generate anger, rather than pride.


So many things have gone wrong, become worse, failed or fallen apart, and so few things have improved that we all know which group would form the longer list. Worse than that, the few things that a few people might say are improvements would be disputed, if not rejected outright by almost everybody else.


In other words, narrowly subjective opinions apply to most of the claimed benefits, but broadly objective facts describe the horrendous costs that have been inflicted on all but a privileged few.


A good place to start is the value of our savings and our currency. People who cautiously saved for whatever reason have seen even respectable sums turned into almost valueless waste paper. Well-run countries have stable currencies. A measure of how well Zimbabwe has been run is that our currency has lost 99% of its value since the beginning of 2001. This is not a matter of opinion, it is a cold fact revealed by simple, dispassionate arithmetic.


Almost the identical figure is reached by comparing our past and present official exchange rates against the US dollar. This was $55 to one US dollar at the beginning of 2001 and had reached $5 700 by the end of 2004. As 55 is less than one hundredth of 5 700, the Zimbabwe dollar at the end of 2004 had the value of a January 2001 cent.
 
The exchange rates prove that we now need more than a hundred times as many Zimbabwe dollars to buy one US dollar.


Our economy is now only about half the size it was in 2001.


Zimbabwe might have broken a few world records with these achievements. This is simply because no other country appears to have suffered such a sharp decline without having been attacked by a ruthless foreign enemy or by domestic insurgents. A war has been waged in Zimbabwe, but it was not the result of an attack by an external enemy and neither was it because of an attack from within.


What has happened in Zimbabwe is best described as the effects of a ruling party decision to withdraw the protection of the law from a specific economic bloc — the collection of large-scale business enterprises usually referred to simply as Zimbabwe’s commercial farms. Then the same party enthusiastically joined in the resulting looting and pillaging of the unprotected business assets.


Their attempts to formalise and legitimise their actions through constitutional amendments and new Acts of parliament have not brought as much as a hint of legitimacy or morality to their actions. Neither have they offset the massive injustices inflicted on the people whose personal endeavours, sacrifices and lifetime commitments were destroyed.


The claimed benefits that were said to have emerged from this now amount to almost nothing. Apart from homesteads acquired for nothing by political heavyweights, the changes have created small farms in place of big farms, but they all need subsidies that the country cannot afford.


Vast areas of the country that used to deliver large tonnages of valuable crops and earned considerable sums in foreign exchange are now delivering, at best, a little comfort to some of the resettled families.


Statistics are usually too cold and impersonal to convey the facts about the human consequences of bad decisions, but in Zimbabwe these are glaringly obvious to everyone. Hundreds of thousands of people used to have jobs on the farms, regular cash incomes, houses for their families, schools for their children and clinics that could help them stay healthy.


What is left of these barely rates a mention, but the losses to the affected people are profound. Very few of the family heads have found alternative jobs or accommodation, most have had to settle for subsistence farming or charity and millions of children have seen their prospects of a reasonable education destroyed.


Vagrants and street-children are now far more numerous in the urban areas and the appalling conditions have dramatically reduced life expectancy across wide swathes of the population.


The architects of the chaotic conditions focus only on the relatively small number of farmers they have displaced. They dismiss as irrelevant the wider social issues, but the destruction of about 4 000 large-scale farming businesses has impacted directly upon about 400 000 employees, suppliers and customers and indirectly upon every other member of Zimbabwe’s 12 million population.


Zimbabwe’s ruling party will go down in history, not for recovering for the country’s population of 12 million the land that was sparsely inhabited by half a million people a century earlier, but for wiping out the benefits of decades of painstaking development that had brought benefits to everyone.


Food production has fallen to about a third of our requirements, investment

inflows have almost stopped and very few of the 1,5 million school-leavers of the past five years have yet found the kind of employment they need.

In 2005, Zimbabwe is producing fewer manufactured goods than it produced in 1971 when our population was less than half its size today. And this year our export revenue is likely to closely match the US dollar values of our exports of 23 years ago in 1982.


The Zimbabwe dollar/US dollar currency conversions for 1982 are not difficult because during that year our respective dollars were almost of equal value. Now you will need lots of luck or good connections to buy a US dollar for $6 070, and if you are not one of the fortunate few, the price will be closer to $15 000 each.


Having seen our exports fall back to the values of 23 years ago, we can now afford to pay for imports of only that value too, but our situation is even worse than that. Back then we had a perfect debt service record, so we had credit lines, foreign loans and aid donations to help pay for imports. We could therefore cope with temporary setbacks like poor harvests.


Now our overdue debt repayments and debt service arrears have pushed our country risk and credit ratings to the lowest levels possible on their respective scales. We are getting no balance of payments support, budget support or commercial loans and we must now pay cash in advance for just about everything we import. Food imports can be paid for only by cutting the imports of just about everything else, so shortages of all kinds are mounting by the day.


Our crippled economy is certainly nothing to be proud about. Policies deliberately chosen and spitefully enforced on our long-suffering population have been backward-looking, destructive and painfully inappropriate. The costs are mounting still, even as the claimed benefits rapidly crumble away.

We should now be considering the potential costs and benefits of an angry response to the ruling party’s callous abuse of its power. It is long overdue.


In 2005, Zimbabwe is producing fewer manufactured goods than it produced in 1971 when our population was less than half its size today. And this year our export revenue is likely to closely match the US dollar values of our exports of 23 years ago in 1982.


The Zimbabwe dollar/US dollar currency conversions for 1982 are not difficult because during that year our respective dollars were almost of equal value. Now you will need lots of luck or good connections to buy a US dollar for $6 070, and if you are not one of the fortunate few, the price will be closer to $15 000 each.


Having seen our exports fall back to the values of 23 years ago, we can now afford to pay for imports of only that value too, but our situation is even worse than that. Back then we had a perfect debt service record, so we had credit lines, foreign loans and aid donations to help pay for imports. We could therefore cope with temporary setbacks like poor harvests.


Now our overdue debt repayments and debt service arrears have pushed our country risk and credit ratings to the lowest levels possible on their respective scales. We are getting no balance of payments support, budget support or commercial loans and we must now pay cash in advance for just about everything we import. Food imports can be paid for only by cutting the imports of just about everything else, so shortages of all kinds are mounting by the day.


Our crippled economy is certainly nothing to be proud about. Policies deliberately chosen and spitefully enforced on our long-suffering population have been backward-looking, destructive and painfully inappropriate. The costs are mounting still, even as the claimed benefits rapidly crumble away.

We should now be considering the potential costs and benefits of an angry response to the ruling party’s callous abuse of its power. It is long overdue.


*John Robertson is an independent economic consultant.

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