Recovery will be long and slow
By Eric Bloch
THERE are diverse levels of the prophecies of doom and gloom. Some of the Zimbabwean populace are convinced that the economy is beyond recovery, and that the future has naught but further economic decline and
collapse, poverty and hardships for all.
There are others who also enunciate little but prophecies of doom and gloom, contending that an economic turnaround is improbable in the extreme, but nevertheless acknowledging a remote possibility that it may occur.
However, in admitting that an economic transformation could materialise, albeit that they perceive the prospects thereof to be very unlikely, they qualify their admission of the possibility of an economic recovery by stating that if it does occur, it will be extremely long and slow.
As recently as a week ago, one of Zimbabwe’s leading economists foreshadowed that, if an economic metamorphosis did lie ahead, some time in the future, it would be an extremely prolonged one in coming, requiring 10 to 15 years before it could be authoritatively contended that the economy had recovered.
Professor Tony Hawkins is indisputably one of Zimbabwe’s foremost economists, with a near unchallengeable depth of knowledge and expertise of economic issues in general, and Zimbabwean economics in particular (even though he scathingly attacks that which he has dubbed “Blochenomics”, notwithstanding that he attributes to this columnist opinions or principles which I have not stated, and of which I am not possessed — but it is his absolute right, as it is of all others, including RES Cook, PRN Silversides, and the so-called economic experts of the MDC, to differ with me and my views, even when he and they misinterpret them).
That he and I must sometimes agree to differ does not necessarily reflect negatively upon either of us, or upon both of us, and conflicting views can provoke dialogue which in turn can enhance understanding and the development of solutions.
As was evident when we addressed a seminar last week, we have very different perspectives as to the period of time that will elapse, if and when an economic recovery commences, and that recovery will be complete.
Hawkins was outspoken that at least 10 years will be required, and very possibly as much as 15 years. In contradistinction, although I am not hopeful that the commencement of recovery is imminent, I believe that once it does begin, it will be attained in a period of six years.
In expressing that view, I foreshadow that it will take three years after recovery commences to restore the economy to the levels that prevailed in mid-1997, which was shortly before government embarked upon its vigorous paths of economic destruction.
Thereafter, it will require at least a further three years to achieve that which would have been Zimbabwe’s economic well-being, had the path of immolation of the economy not been pursued by government for nine or more years.
The prophets of doom and gloom focus their depressing predictions upon diverse factors, all of which have undeniable relevance, such as the ravaged state of the agricultural sector, whose infrastructure has been decimated, upon the magnitude of the national debt in general, and the state’s vast fiscal deficits in particular, upon the pariah status of Zimbabwe within the international community (and especially insofar as the investor populace is concerned), upon the marked lack of substantial success of Zimbabwe’s greatly heralded “Look East” policy, upon the overwhelming loss of skills occasioned by the very pronounced “brain drain” of recent years, and upon very many like, negative factors.
None of these negatives can be denied, and all must impact adversely upon the progress of economic recovery, once that recovery commences.
However, there are also numerous positive factors which can aid and enhance economic development, once a recovery-enabling environment comes into being.
Zimbabwe has vast potential economic wealth in a number of very material respects.
These include a tremendous treasure trove of minerals, most of which are as yet barely exploited. It has very considerable, commercially exploitable, gold reserves, but its present mining of those reserves is relatively minimal.
The same is fact in respect of platinum, uranium, diamonds, coal, chrome, nickel, other precious and semi-precious minerals, metals and methane gas. Provided that Zimbabwe can assure investors of security of investment, political and economic stability, economic deregulation, international acceptability (inclusive of preservation of law and order, a free and independent judiciary and respect for human rights), much capital and technological expertise will pour into Zimbabwe’s mining sector.
That will generate great employment, considerable downstream economic benefits, invaluable foreign exchange inflows and fiscal revenues.
The same holds good for the presently embattled, ravaged, agricultural sector. Its potential is indisputable, as evidenced by its decades of provision of food self-sufficiency to not only Zimbabwe, but also neighbouring states, its considerable, quality production of tobacco, cotton, sugar, citrus, tea and coffee, beef and much else.
The sector can recover and can be a major economic contributant, if the same positive factors as necessary for the mining industry would be put in place, together with the provision of security of tenure of land, harmony and co-operation between farmers of all races and removal of governmental confrontationalism.
Zimbabwe can also have one of the world’s foremost tourism economies.
It has an almost overwhelming array of attractions to offer the tourist, ranging from the incomparable Victoria Falls and the great Zambezi River to an amazing wealth of wildlife (provided that poachers are prevented from destroying that wealth), to the grandeur of the Matopos, the mystic of Great Zimbabwe and Khami.
The splendour of Nyanga, Bvumba and Chimanimani, the breath-taking Lake Kariba and much, much more.
And, despite the very considerable harm inflicted upon the manufacturing sector in recent years by dogmatically destructive governmental policies, nevertheless Zimbabwe still has the second most advanced industrial infrastructure in southern Africa, and is geographically poised to serve a central, eastern and southern African population of over 320 million consumers.
The magnitude of the Zimbabwean “brain drain” in the last few years has been horrendous, resulting in a very great lack of skills.
That lack can be a major constraint upon economic recovery, for the reality is that most who have left will not return, even though that had been their intent when they left.
In practice, they have developed new lives, embarked upon new career paths, sunk new roots and most will not come back to Zimbabwe.
But, when the fundamental elements required for economic recovery are put in place, the need for skills can be transitionally addressed by facilitation of expatriate employment, pending the development of a new, permanent skills base.
The imponderable, however, is when will the recovery commence?
It cannot occur until the necessary enabling environment is created and that can only occur when government has a genuine, unlimited will to make it happen.
In theory, the National Economic Development Priority Plan (NEDPP) is supposed to do so, but it is yet another economic recovery façade, for that will does not, in practice, exist.
That will can only come about when there is either a change of government to one that has the will or, in the alternative, there is a transformation within the present government to one able to acknowledge the very great deal that it has done wrong, able to learn from such acknowledgement, and therefore willing to undergo genuine change.
Until then, it is inevitable that the economy will continue to decline, economic recovery will be nothing other than wishful thinking, and Zimbabwe will continue to blame the international community, non-existent economic sanctions, climatic conditions, and the like.
But, as was the case in Russia, China, Yugoslavia, Serbia, Mexico, Brazil, Argentina, Zambia and innumerable other countries, eventually economic desperation, and the need to survive, bring about the necessary changes.
Then economic recovery will commence and, with its very great potential wealth, the Zimbabwean economy can well transform, positively and substantially, within six years.
Recovery will be long and slow