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Mugabe has Mbeki over a barrel regarding financial bail-out
William Mervin Gumede
July 30, 2005

http://www.sundayindependent.co.za/index.php?fSectionId=1078&fArticleId=2727654

The cantankerous Zimbabwean President Robert Mugabe seems to have won again. In spite of his appalling record of battering the opposition, human rights abuses and disregarding basic freedoms, he is likely to be bailed out by South Africa to the tune of R6,5 billion.

This is the approximate amount Zimbabwe owes the International Monetary Fund. The IMF meets in August to decide whether to expel the country. A process of formal expulsion is already in motion. Mbeki and his strategists argue that providing Zimbabwe with a rescue package will finally give the South African government the leverage that five years of quiet diplomacy has spectacularly failed to secure.

Part of the South African rescue package would be agricultural help following Zimbabwe's predictable maize crop failure, which has left the country with a 1,6 million-ton shortfall. Not surprising,

if one considers the disruption of agricultural production following Mugabe's mismanagement of land reform.

Among the terms of the rescue deal would be that Zimbabwe return to the rule of law and that Zanu-PF step up talks with the opposition Movement for Democratic Change; lift the restrictions on the media and civil groups; stop Operation Restore Order, a controversial urban clean-up campaign; and protect the property rights of South African investments there.

It also compels the Zimbabwean government to manage the economy prudently, including reining in runaway inflation, devaluing the Zimbabwean dollar and raising domestic revenue by increasing fuel prices.

An important element in the renewed eagerness of the South African government to stand surety for Zimbabwe is that Mugabe has also approached China for a loan. The Chinese demand substantial concessions for such a loan, including access to coal, gold and platinum deposits. In return, the Chinese would not only grant the loan, but try to protect Zimbabwe at the United Nations and IMF.

Mbeki fears South Africa's political and economic interests are at peril if the Chinese get a clear foothold in Zimbabwe - although the Chinese are already there.

Chinese political reach into the region will presumably go against South Africa's attempts to bring good governance to Africa. The symbolic value of the Chinese presence would be that bad governance does actually pay.

The loan offer to Zimbabwe reflects Mbeki's belief that Zimbabwe's economic woes are partially to be blamed on the legacy of colonialism. Thus Mbeki's statement: "It is wrong to say that the debt problem in Zimbabwe is one of corruption, that money was disappearing to corrupt politicians."

But this is only half-true. It is obviously correct that after liberation in Zimbabwe, the former Rhodesian regime left a depleted and ransacked fiscus. The Nats did the same to the incoming ANC government in 1994. The Zimbabwean government initially spent and borrowed heavily to give its newly liberated citizens a better life.

The truth is that, since then, Zanu-PF corruption, kleptocracy and mismanagement have compounded the country's woes. Rampant cronyism and corruption - giving land and jobs to pals - caused outrage among Zanu-PF supporters.

Mugabe and Zanu-PF's leaders responded to a potential revolt by conveniently saying the fact that the land was still in a few white hands (which was true and, it must be added, also in the hands of a few blacks connected to Mugabe and the Zanu-PF leadership) was to blame for slow delivery on land and jobs.

The question of South Africa paying Zimbabwe's IMF debt was proposed by Mbeki, and supported by Nigerian President Olusegun Obasanjo, in 2000.

Then, predictably, Mugabe eagerly agreed to terms which were almost exactly the same. And, no surprises, he reneged on all those. Moreover, Mugabe has reneged on most, if not all, other promises he has made before.

How is the South African government going to hold the Zanu-PF regime to conditions when they've failed to do so up to now? And how is the SA government going to ensure the money is actually going to feed the starving people of Zimbabwe, and not only those seen as Zanu-PF supporters? So far, we've had no clear answers.

*Published on the web by Sunday Independent on July 30, 2005.

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