Zimbabwe: Rushing backwards

COUNTRYFILE

Despite the defiant stance taken by the Zimbabwe government, Finance Minister Simba Makoni has admitted that the country's economic situation is dire. Witness Chitepo asks just how bad it can get.

Zimbabwe's manufacturing base, already shaken to the core by more than two years of skewed economic policies, is expected to shrink further. Inflation, the highest in the southern region is expected to hit 200% by year end, from June's 114.5%. Hunger is stalking half of the 13m people and shortages of most basic commodities, like maize meal, sugar, cooking oil, milk, cigarettes, salt and margarine, are rampant. Queues - which at times turn violent - are now common place throughout the country.

The balance-of-payments deficit is set to worsen almost 10-- fold this year - from $194m to $1.lbn - in what analysts say is another sign that the government is now realising that its policies have failed to arrest the freefall in exports and contain a two-year old foreign currency crisis.

According to independent economist John Robertson, at 2001 Zimbabwe dollar prices, Zimbabwe has seen export trade fall by Z$134bn over just two years. This sum converts to $600m at an exchange rate of Z$220 to one US dollar, or to $2.4bn at the ridiculous official exchange rate of Z$55 to one US dollar.

"The $600m is equivalent to a whole year's earnings from tobacco, Zimbabwe's most important export crop," Robertson says. "Because it was lost, about 20,000 jobs have been lost in industry. The $600m would also have been enough to pay for all the food imports now that we have failed to produce the needed crops. Instead, we have to beg for loans or grants to pay for it," he said.

Zimbabwe's conduct has led to withdrawals of development aid from most of its regional neighbours. Zambia believes that but for the `contagion effect' from Zimbabwe, it would have had much more success attracting direct investment as well as in restoring more of its own manufacturing capacity. The amount lost cannot be estimated accurately, but probably exceeds $500m.

In South Africa, the lack of will to express disappointment or anxiety about Zimbabwe's conduct since 1997 has caused the rand to fall from R6.5 to one US dollar to figures that recently reached R11 to the dollar. Even if the rand's loss of value is estimated at the lower end, ix from R6.5 to R9.5 to one US dollar, South Africa's import bill of $27bn a year grew, in rand terms, from R175bn to R256bn, an increase of R81bn. This expressed in US$ terms amounts to $7.7bn, so South Africa's direct loss exceeds the full amount of support agreed to at the Nepad Conference in Canada for all the beneficiary countries.

The social disaster in Zimbabwe cannot be measured. More than 100,000 displaced farm workers are now living wretched lives in refugee camps and another 200,000 are expected to be displaced within the coming month.

More than a quarter of a million children who were being educated in schools built and maintained by commercial farmers cannot now expect to continue their education. Perhaps 80,000 industrial jobs will be lost as supplies of agricultural inputs run down, or as their former customers for crop inputs are driven from the land.

Three quarters of the agricultural exports will come to an end with the destruction of commercial agriculture and the loss of this revenue will damage or destroy the prospects of survival of most of the remaining businesses and most other urban jobs.

The only political figure in recent history who comes close to Robert Mugabe's wilful destruction of the lives of his own citizens and his country's economic resources is Pol Pot. Because Pol Pot's romantic, but absurd vision of the perfect pastoral life under a peasant agricultural economy could accommodate only about a quarter of Cambodia's actual population, he started to ruthlessly slaughter the excess numbers, choosing to kill any with an education or who showed reluctance to slip quietly under his totalitarian subjugation.

Economist Robertson says Zimbabwe's carrying capacity for its human population has been boosted vigorously over the years by industrial growth and the adoption of first world technologies, and the population now stands at about 13m. "However, its carrying capacity if the people are forced to revert to peasant agriculture will be no more than a quarter of that. The climate is too hostile, the ecology too fragile and the natural hazards of crop diseases and pest invasions are too destructive to farm successfully in any manner other than in the highly capital and management-intensive commercial methods that are now being destroyed," he warns.

By being forced to accept the basic farming methods of their ancestors, Zimbabwe's new farmland occupiers will face poverty and starvation on the million small plots being carved out of the 6,000 commercial farms now being nationalised.

According to Finance Minister Makoni, Zimbabwe's mainstay agriculture sector, in turmoil over the part two years, is this year expected to shrink by 24.6% instead of only 6% projected at the beginning of the year. But the Commercial Farmers Union, whose white members contribute 60% of total agricultural output, has said the sector would fall by much more than the 24.6% predicted by Makoni because of an alarming 40% decline in commercial agriculture.