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Indicators of economic decline
Media Monitoring Project Zimbabwe (MMPZ)
Weekly Media Update 2005-36
Monday September 19^th – Sunday September 25^th 2005

THE country’s continued economic meltdown also featured prominently in the week with both sections of the media highlighting indicators of economic decline.

However, most of the 68 stories that the official media carried (ZBH [43] and government papers [25]) were piecemeal and failed to address holistically the causes behind the economy’s freefall.

ZBH’s reports in particular were largely reactionary and premised on fault-finding rather than problem-solving. For instance, ZTV (21/9, 6pm) did not investigate the economic rationale behind pharmaceutical companies’ drug price increases by more "300% since the beginning of the year" or relate the increases to the country’s economic meltdown.

Rather, the station resorted to regurgitating government threats against the firms with its reporter commenting: "…government has warned the sector to stop increasing prices in this manner."

Threats against industry also appeared in The Herald (22/9). The paper supinely reported the central bank claiming that it was owed about US$212 million by exporters "who have either not remitted their export receipts or submitted their foreign currency declaration forms". Without investigating the reasons for this, the paper simply quoted the RBZ threatening exporters to "immediately pay up" by "end of business on Friday September 30 2005" or risk "punitive" penalties such as "forfeiture of entitlement to foreign currency accounts retention until such a time that outstanding amounts have been paid".

ZTV (22/9, 8pm) carried a similar story. However, it did also quote the chief executive officer of the Zimbabwe National Chamber of Commerce (ZNCC), Innocent Makwiramiti, saying that although some businesses were guilty of this, he also held the RBZ liable for "inefficiency…when processing papers…"

The private media was more revealing in its 23 stories (private newspapers [17] and Studio 7 [6]) on the country’s economic problems. The reports tackled issues such as government’s continued failure to solve the fuel and foreign currency shortages and the country’s failure to attract foreign investment due to government’s controversial policies.

For example, The Standard reported analysts saying, contrary to claims by Justice Minister Patrick Chinamasa that the country had "bottomed out" and was "ripe for economic take off", Zimbabwe was headed for the worst times as "industrial capacity utilisation has deteriorated to between 25 and 30% while many firms are filing for bankruptcy".

Studio 7 (21/9) carried a similar story and quoted economist John Robertson attributing the poor showing of some industries to the decline in agriculture since businesses that relied on raw materials from agriculture were "almost out of business."

The Independent revealed that the country’s platinum mining giant Zimplats had threatened to close down due to government’s contradictory economic policies. The paper reported that government had made a "sudden U-turn" by revoking an agreement with the mining giant that exempted Zimplats from paying withholding tax. Now the government wanted the platinum miner to pay the tax, calculated at $400 billion including penalties.

Zimplats’ chief executive officer Greg Sebborn told the paper that the "impact" of the latest development "will be severe, not only to Zimplats’ operations but on investor perceptions in general" as the "agreement was specifically crafted to attract large-scale investment in the country".

In addition, the paper, Studio 7 (22/9) and SW Radio Africa reported on the fresh controversy surrounding the origin of the US$120 million that government used to offset its US$295 million arrears to the IMF to avoid expulsion. These media reported Zimbabwean businessman Mutumwa Mawere as having written to the Fund, including the World Bank and UN, complaining that government had used "proceeds" from his "expropriated companies", which "generate US$100 million per annum" to pay the arrears.

None of the media carried concrete evidence from Mawere to substantiate the claims.

However, Studio 7 (24/9) reported the IMF saying it would investigate the source of the funds but would not say whether or not the investigations were prompted by Mawere’s complaint.

The government media ignored the matter. The Sunday Mail, for example, only reported Reserve Bank Governor Gono defending his decision to pay the IMF instead of "putting the money to local use" as demanded by industrialists because the business community had "‘pleaded’ with him to make the payment". He also told ZTV (22/9, 8pm) that had Zimbabwe been expelled from the Fund, "the catastrophe (would have been) beyond what the ordinary man realises".

Meanwhile, as the media, especially the government ones, spiritedly debated the ‘disappearance’ of eight soccer players in the UK following a friendly match between Highlanders and CAPS United football clubs in Bradford, it was only Radio Zimbabwe (23/9, 8pm) that linked the disappearance to the economic decline.

It reported that the players were "suspected to be seeking economic refuge."

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