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How to plunder an economy
John Rapley, Jamaica Gleaner
August 09, 2007

http://www.jamaica-gleaner.com/gleaner/20070809/cleisure/cleisure2.html

First lesson in economic plunder: take a regional breadbasket with a dynamic industrial base, mismanage it into the ground, and you have the recipe for Zimbabwe.

Imagine having to rush through your grocery shopping to reach the check-out before the prices rise yet again. That's how life is becoming in Harare. Rushing is probably a waste of time anyhow: queues can keep you waiting for an hour or more, and the goods you await might not be available.

And the prognosis is for worse. Zimbabwe already has the world's highest inflation rate, with some estimates suggesting it may reach 100,000 per cent by year's end. Inadequately maintained due to shortages, the country's infrastructure is running down. Electricity and water supplies can stop running for days.

Urban unemployment is soaring. The wages of those who have jobs have been gobbled up by inflation. Most of Zimbabwe's population lives in the countryside, where an agrarian crisis has created food shortages. In desperation, thousands of Zimbabweans leave the country each day. Estimates of the daily exodus to South Africa alone range up to 10,000. It is all creating a sense of crisis in neighbouring countries.

Pressing for changes quietly

However, South Africa has stuck by a regional tradition of pressing for changes quietly, while openly supporting the government of Robert Mugabe. It is no secret the South Africans are not pleased with Mr. Mugabe. But so far, their actions to dislodge him or to persuade him to create space for the opposition have amounted to little.

Not that there seems to be much the South Africans can do. As unhappy as Zimbabweans have become, they still see Mr. Mugabe as the best of a bad lot. Despite the country's parlous state, the opposition cannot rally around a common cause or leader.

Faced with this, the ruling clique around Mr. Mugabe has opted for the status quo. Reportedly unhappy themselves, they cannot agree on a way forward for the country. In the midst of the inertia, the ruling party has once again approved Mr. Mugabe as its candidate in next year's presidential election.

Mr. Mugabe's response to the crisis appears to be to rail against white farmers and British colonialism. Warranted as some of his rants may seem, they do not solve the crisis. His government's response to the inflation has been to print new bank notes and freeze prices, using thugs to enforce the regulations. Meanwhile, he has announced a programme of taking over white-owned business in order to enrich poor Africans.

No friend to black bourgeoisie

As is to be expected, the price controls have only worsened shortages. As for the Africanisation of the business community, Mr. Mugabe is acting a bit disingenuously. Despite his rhetoric, Mr. Mugabe long patronised the white urban business class, and was no friend to Zimbabwe's black bourgeoisie. The Africanisation programme appears mainly to be benefiting his inner circle. With their access to scarce foreign currency, they are snapping up assets at fire-sale prices.

The amazing thing is that, despite this mess, foreign investors are still coming into Zimbabwe. Some adventurous punters are betting that things cannot get much worse, that Mr. Mugabe will soon die, and that the country's immense potential will then begin to be realised once again. So while Zimbabweans head for the exits, a few brave souls are venturing in.

It may be a tad optimistic. Though it's a pity that in recent years Mr. Mugabe has been most effective at doing damage, there is little doubt he is an effective leader. Zimbabwe has no obvious successor to him. The circle around him is opportunistic, not visionary or reformist. The outlook is not promising.

* John Rapley is a senior lecturer in the Department of Government, University of the West Indies, Mona.

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