WHEN Reserve Bank governor Gideon Gono quietly slipped out of the country two weeks ago he had three main missions on his agenda. This week he returned home almost empty-
handed, having accomplished less than he had hoped.
His first task took him to Washington hoping to persuade the International Monetary Fund (IMF) to resume much-needed balance of payments support.
He also visited the United Kingdom to convince Zimbabweans in the diaspora that his Homelink initiative was a patriotic, safe and convenient means of sending money back home.
Another issue on the agenda was to sweet talk investors into pouring funds into the economy.
But judging by recent events in the UK, Gono has achieved only modest success on all three missions.
He, however, says the trip was a success.
The reasons for his failure is more political than economic analysts say.
The political crisis in Zimbabwe will continue to haunt Gono’s efforts to resuscitate the economy, which has been affected by President Robert Mugabe’s policies.
His drive to lure investors will hit a brick wall because Zimbabwe is still classified as a risky investment destination.
His attempt to persuade people in the diaspora to send money back home will not yield much because they want a change of government, political experts say.
The Bretton Woods institutions will not give financial support unless the Zimbabwean government is committed to pay its mounting debt and stop destructive economic policies.
Gono might be trying to sell noble and viable policies but because of his association with the regime his initiative could come to nought, analysts warn.
“His visits achieved nothing. He got nothing from the multilateral organisations (IMF and World Bank). And the stumbling block is politics,” said Eddie Cross economic advisor to the Movement for Democratic Change (MDC).
“The country remains suspended and the government’s token payments have not changed that. It’s the political crisis in this country that is causing problems for him.
“The answer is in addressing the political crisis before we engage the organisations otherwise we have no chance of getting foreign aid and balance of payments support.”
The IMF has in the past expressed concern over what they called destructive economic policies.
Zimbabwe owes about US$273 million to the IMF and continues to lag behind in terms of payments.
Analysts also said they feel the lack of agreement in the government on the role of the IMF also add to the organisation’s sceptical attitude towards Gono’s overtures.
In his monetary policy statement Gono said Zimbabwe would reengage the multilateral organisations in order to pay off its debt.
“We will engage whoever we owe money,” said Gono in the statement.
This bold statement was however immediately shot down by President Mugabe when he again attacked the IMF. This inconsistency in national policy also made Gono’s task in Washington more difficult. The World Bank and the IMF remain concerned about the political turmoil in the country, which has not improved since the last election.
Gono’s setbacks continued in the UK where angry Zimbabweans who protested against the Homelink initiative confronted him.
Hundreds of Zimbabweans in the diaspora are reported to have taken to the streets in protest against both Gono and his Reserve Bank team that is having Homelink road shows.
Zimbabweans in the diaspora want their voting rights before they can send money back, the media reports say.
They were, according to reports, also demanding a regime change.
“The attitude of the three million people in the diaspora is that Gono is a front man for the Zanu-PF government,” said an economic analyst with a local bank.
“The feeling is that Gono is part of the regime that has brought so much chaos. So sending money is as good as helping Zanu-PF clean up its mess.”
Other analysts said they felt that due to the their illegal status individuals in the diaspora are likely to be reluctant to use an official institute to send their money.
They note that most Zimbabweans in the UK are either political or economic refugees who are uneasy about revealing their whereabouts.
“People in the diaspora might want to send money home but they want something in return and that is their right to vote. It’s indeed a tall order for him,” said a local economist with a leading bank.
“As for the IMF issue I think Zimbabwe must just pay up to get more. And our politics also comes in. Zimbabwe’s high-risk profile will continue to haunt Gideon Gono and government’s efforts to lure foreign direct investment and to acquire foreign funding for local business. Local business firms have been battling to secure funding for their business due to the uncertain political and economic situation.”
Leading business intelligence organisations continue to produce damning analysis of the country’s risk profiles and environment.