Zimbabwe: power-play and opulence in an ailing economy

Zimbabwe: power-play and opulence in an ailing economy

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Capacity utilisation in the manufacturing sector has declined
President Robert Mugabe: presiding over an ailing economy
President Robert Mugabe: presiding over an ailing economy

A one-time jewel of Africa, Zimbabwe is mired in a deepening socio-economic crisis, writes Earnest Mudzengi in Harare.

A spate of company closures, infrastructural decay, escalating cost of living and a collapsed social service delivery system all but indicate that all is not well. But, the country’s ruling elite is too preoccupied with politics of power and self-pampering to give attention to the ailing economy.

The self-aggrandissement syndrome stretches from the first citizen to the most junior officer in the country’s bloated civil service and security sector. Soon after his daughter’s lavish wedding that reportedly cost $4 million last August, President Robert Mugabe left for his traditional December vacation in the Far East.

Accompanying him on the month-long, state-funded private holiday, were the First Lady, his daughter, two sons, the new son-in-law and support staff. This was against the backdrop of a gloomy national budget presentation by finance minister Patrick Chinamasa. Also preceding the vacation was the ruling Zanu PF’s sixth national congress, at which the main focus was the jostling for positions instead of fixing the comatose economy.

While the era of the coalition government between Zanu (PF) and the two Movement for Democratic Change (MDC) formations from 2009 to 2013 brought some ray of hope for economic recovery, the period after the 2013 elections, resoundingly won by Zanu (PF), has been characterised by a debilitating economic downturn.

As per minister Chinamasa’s 2015 budgetary statement, 4,500 companies have closed down in the last three years, with at least 55,000 job losses during the same period. Of the companies that closed down since 2013, 458 were once vibrant manufacturing sector.

Capacity utilisation in the manufacturing sector has declined
Capacity utilisation in the manufacturing sector has declined

As minister Chinamasa put it, Zimbabwe’s manufacturing sector is hamstrung by liquidity shortages, antiquated plant and machinery, cheap imports and high cost of production. There is, indeed a pressing liquidity crunch as Zimbabwe largely depends on imports for day-to-day needs. According to the Zimbabwe Statistical Agency, Zimbabweans spent a total of $469 million on importing motor vehicles in 2014. Most of these were cheap second hand vehicles, mainly sourced from Japan and the United Kingdom as capacity utilisation for Zimbabwean car assemblers sharply declined to 5 percent.

In industrial areas, the once well-oiled manufacturing plants now resemble archives of the nineteenth century industrial revolution. Without much coming by way of substitution, the greater part of the populace is now depending on cheap clothing and food imports from the Far East and some neighbouring countries.
Zimbabwe’s largest private sector umbrella body, the Confederation of Zimbabwe Industries (CZI), has confirmed the severe contraction of the manufacturing sector. In its most recent report, CZI states that capacity utilisation in the sector has declined to 36.3 percent from 39.6 percent in 2013.
Small-scale business is equally suffering. Bruce Mutikinyi, a taxi operator says business has hit an all time low since the 2013 elections. ‘In the era of the inclusive government, we were kept busy. People had money to spend. We did not have much time to sit around as we were constantly being hired,’ Bruce said, referring to the time of the coalition government when Zanu PF and MDC governed together. ‘Now, the case is different as we spent most of the days seated in our cabs, waiting for clients who hardly come,’ he added.
In the 1980s, people from neighbouring countries like Zambia and Mozambique used to flock to Zimbabwe in search of employment. Now the situation has reversed, with Zimbabweans now trickling to neighbouring countries in search of greener pastures. Those who work within Zimbabwe have to do with meagre wages that are not often paid on time owing to the liquidity crunch. A Finscope Consumer Survey of 2014 reveals that less than half of Zimbabwe’s working population earn less than $100 a month. This is against a monthly poverty datum line of $500.

School drop-out is on the increase
School drop-out is on the increase

The same survey shows that 44 percent of the Zimbabwean population have to skip a meal for lack of money to buy food. There was also an increase in the number of children dropping out of school for failing to pay school fees from 25 percent in 2011 to 36 percent in 2014. In addition, 70 percent of Zimbabweans are unbanked, with a significant number indicating that they cannot afford to maintain the minimum balances required by the banks. Another gloomy indicator from the survey is that 53 percent of Zimbabweans do not save, with the main reason being that they are left without any money after covering basic expenses such as rentals, food, and water and electricity bills.

Despite such depressing indicators, government officials continue to live ultra-luxurious lives. As part of their perks, cabinet ministers continue to be chauffer-driven in the latest Mercedes Benz E 300 sedans and state of the art S Class Mercedes limousines for vice- presidents. This is over and above being issued with equally expensive Sport Utility Vehicles that can be selected from a wide range including the Land Rover Discovery 4, Jeep Grant Cherokee and Toyota Land Cruiser Prado. These and many other entitlements filter to the most junior of chefs, including those in the state security apparatus.

In January, the weekly Zimbabwe Independent reported that the government purchased new vehicles for ministers and the Central Intelligence Organisation (CIO) at a cost of $2 million. Another set of new vehicles was bought following the 2013 harmonised elections.

This sort of extravagant spending amidst deepening poverty and decaying social services points to a government that thrives on self-preservation at the expense of citizenry welfare. In the words of the late Professor John Makumbe, formerly of the University of Zimbabwe, President Mugabe and most of his cabinet colleagues have been in office for far too long and have run out of ideas to resolve the many economic, social and political problems that confront Zimbabwe.

As has been observed by analysts, the recent power struggle within Zanu PF, which saw liberation war icon and former Vice President, Joice Mujuru being ousted from government and the top echelons of Zanu PF, point to the tragedy of a political elite that is clueless on the economy, but is primarily concerned with preserving political power and accompanying socio-economic gains. Among reasons given for Mujuru’s ouster was that she was cosying up to the MDC and the West in discussions relating to a post-Mugabe solution to the prevailing economic malaise.

Joice Mujuru: sacked from government
Joice Mujuru: sacked from government

At the core of Zanu PF’s narrow-ended survival strategy is a closed, centralised political system that repeals progressive political and economic reforms. As pointed out by Professor Gathseni Ndlovu, a historian and political scientist with the University of South Africa (UNISA), there is a cabal within Zanu PF that is so obsessed with remaining in power to the extent that they feel threatened by reforms that open up the political arena for free contest.

As Professor Ndlovu’s puts it: ‘Mugabe and Zanu-PF have openly expressed their antipathy towards democracy, and their disdain for human rights, claiming that both are aspects of western cultural imperialism. They have demonstrated that they ardently and faithfully worship at the altar of power for power’s sake.’

It is on the altar of power for power sake that the potentially vibrant Zimbabwean economy is being sacrificed. This is being done under a narrative in which Zanu PF proclaims itself to be the alpha and omega of Zimbabwean struggles. In terms of this narrative, there can be no other political or economic struggle other than that which Zanu PF has already championed. This narrative has been well captured by Eldred Masunungure, a political scientist with the University of Zimbabwe who says the top Zanu PF political generation and its allies in the military/security establishment has an ‘end of history’ perspective to the liberation struggle and the achievement of independence in 1980.

This mentality is not in sync with Zimbabwe’s present realities that call for an end to macro populist policies punctuated by an inherent state of contradiction in which a few political elites and their hangers on eat and enjoy on behalf of the masses.

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