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Since independence from Britain in 1980, president Robert Mugabe and his Zimbabwe African National Union-Patriotic Front (Zanu-PF) have dealt ruthlessly with any threat to their monopoly on government. Despite losing an election two years ago, they formed a power-sharing government in name, but where control still lies firmly with themselves. The Movement for Democratic Change (MDC) won the election, but its leader, Morgan Tsvangirai, has had to accept the new post of prime minister – subservient to the president – and has little real authority.
A new constitution is being worked out, but Zanu-PF wants to keep provisions that give the president a near-absolute authority. Despite a majority wanting a more democratic system of government, violence is routinely used to suppress dissent.
The battle between Mugabe and Tsvangirai is not new. In the 2000 election, MDC lost by a handful of seats. Polls in 2002 and 2005 were so violent that most western countries refused to recognize Mugabe’s victory. He and his ministers and army chiefs are banned from entering the US or Europe.
With no aid or investment, and funds increasingly channelled to prop up Zanu-PF, the economy collapsed, inflation reached more than one trillion per cent and the currency became worthless. Half the population live on food aid in a country that used to export milk, beef and cereals.
In the power-sharing agreement, Mugabe controls the military and most key portfolios. But the MDC did get the finance ministry, now led by Tendai Biti.
Biti’s challenges were formidable, coming in the wake of years of economic mismanagement, which had, among other things, led to hyperinflation.
But Biti took decisive action. In February 2009, he scrapped the worthless Zimbabwe dollar. He also reduced the import duty on capital goods to zero. Even so, a 2009 IMF report rated Zimbabwe as the toughest country in southern Africa in which to do business, with everything from start-up regulations to paying taxes made difficult by a mish-mash of regulations.
Conflict within the coalition is especially strong around economic reform. Tsvangirai has demanded that reserve bank governor Gideon Gono resign, but Mugabe will not allow it. (The MDC has tried equally ineffectively to remove Johannes Tomana, the attorney-general.) The MDC has a narrow majority in parliament, but the assembly has only been in session for 13 days this year.
This September, Tsvangirai assured investors that laws requiring foreign or white -owned companies worth more than $500,000 to surrender 51% of their shares to indigenous Zimbabweans had been put on hold. Mugabe disagreed. The policy remains unchanged.
ELECTION CALLS
But many reckon that this stalemate – even if the real control is held by the Zanu-PF – is unstable, and there are mounting calls for a further election. The latest talk is that Mugabe himself wants to hold an election next year. One newspaper reports that he has ordered Biti to find the $200 million needed to hold the poll.
Mugabe’s desire for early elections has surprised many analysts, who believe he would stand little chance of winning a new poll. However, recent signs of frailty show that age is finally catching up with the 86-year-old, and analysts suggest this is an election battle he would rather fight now than later.
Although he gave an interview in September to dispel rumours of his collapse, a western diplomat in Harare said his health was on a “downward trajectory”.
Any Mugabe campaign will be buoyed by the latest mining discovery – a diamond field in Chiadzwa that could generate $1.2 billion a month. The stones were discovered by Africa Consolidated Resources (ACR), which had a valid exploration licence. But when the extent of the field became known, the government cancelled ACR’s concession and handed production to the state-run Zimbabwe Mining Development Corporation.
Albert Makochekanwa, a Zimbabwean economist, claims, “Effectively, all of Chiadzwa diamond revenues have been pocketed by individuals... without any revenue going to the state coffers.”
The Zimbabwe economy was, at independence, the biggest on the continent after South Africa, and much of the infrastructure remains for tourism, light industry and tobacco exports. Though landlocked, Zimbabwe has extensive air, road and rail links to neighbouring Mozambique and South Africa, which handles the lion’s share of traffic.
NEW OPPORTUNITIES?
But there are those who see the economic collapse as a buying opportunity. Trevor Ncube, who owns South Africa’s leading news weekly, The Mail & Guardian, recently launched a daily paper in Zimbabwe. Already his circulation has outstripped the state-owned dailies (the press was nationalized in 1982), and he is optimistic about the country’s future. “There are great opportunities right now, and you can look on Zimbabwe as a kind of virgin territory,” he says. “Things had broken down so much that we have a new ground floor where investors can get in and build up their business.
“Assets are cheap for early comers but there will be a premium when politics normalizes.”
Ncube says that mining was still the sector that made the most news, but “the information and communication technologies sector is wide open, especially the internet because we still have Africa’s highest literacy rate. Tourism is going to be huge, and in agriculture people are doing well with specialty crops.”
ACR’s chief executive, Andrew Cranswick, agrees that the potential exists to build a strong economy, but only if the right environment is created for investors. “Commodities like diamonds and platinum can build wealth very fast, but it needs to be done ethically and transparently, not just to benefit a small clique in government,” he says.
“Look at how diamond wealth has been used in Botswana to create one of the best economies in Africa, and you can see how good things can be.”
Since 2000, an estimated four million people – one in three – have left the country, with 75% moving to South Africa and 500,000 now in Britain. In December, the South African government will end a special arrangement that granted the exiles temporary work permits. According to Pretoria, the situation in Zimbabwe has improved to the point where it is safe for these people to return.
In Harare, John Robertson, an economist, says this will not solve the shortage of skills but could make things worse. “Already we have seen a big jump in armed robbery in Harare,” he says. “And the main flood of people will only come next year. Rents will go up, goods will become scarce, and we will gain a million or more jobless people in a country that already has an unemployment rate above 90%.”
Education minister and MDC senator David Coltart believes a broader look is needed. He says that schools have reopened, books were being printed, and Zimbabwe was reversing its educational disintegration. “In a few years, if the present trend continues, Zimbabwe will retake its place as having the best-educated workforce in Africa,” he says. “I challenge any sector to tell me right now that they cannot operate because there are no skilled workers.”
So is it time for the world to give Zimbabwe a second chance? Certainly with diamond revenues there seems little need for aid, though sectors such as education and health have been getting donor funds.
A key test will be the constitution-making process, which is already underway. Tsvangirai has made it clear he will not contest an election under the current laws that allow the president’s office to virtually run the poll, including the count.
Mugabe’s hard-line youth militia was scaled down last year, but camps are appearing again in remote areas, suggesting that Zanu-PF is readying itself for a new campaign of violence and voter intimidation.