CHENGETAI ZVAUYA/ TAURAI MANGUDHLA
As the Zanu PF Annual People’s Conference roared into life yesterday, the faltering economy, which is expected to contract by 6.5% this year, became the elephant in the room. The conference runs from 11-13 December in Goromonzi under the theme, “Modernise, Mechanise and Grow the Economy towards Vision 2030”.
Since President Emmerson Mnangagwa was given a fresh mandate during last year’s elections, Zimbabwe’s economy has taken a knock despite his administration putting in place measures to stabilise it. During the election campaign, the Mnangagwa-led ZANU-PF promised to prioritise economic recovery.
However, mounting problems – such as rolling power cuts, the lack of confidence, fuel shortages, and a slipping local currency – have become a severe headache for the party and its leader. Job losses and company closures are on the rise. Inflation has hit record levels. A currency conundrum has brought pricing confusion in business.
As a result aggregate demand is falling. Party spokesperson Simon Khaya Moyo said the state of the economy, with mining as a crucial industry, and food security were top on the conference agenda. He said the conference was expected to consolidate national efforts towards reviving the economy, with President Mnangagwa aggressively pursuing economic recovery through the implementation of the Transitional Stabilisation Programme (TSP) 2018–2020.
Interestingly, Zanu PF’s 2018 manifesto promised to transform Zimbabwe into a middle income economy by 2030 and accelerate the harmonisation of investment laws and establish a one-stop-shop for the processing and administration of investments.
The Zimbabwe Investment Development Agency (ZIDA) Bill passed through Senate last week and now requires President Mnangagwa’s assent to become law. ZIDA will integrate all agencies responsible for processing investments under one roof to facilitate the ease of doing business. It will be modelled after the Rwanda Development Board, which is famed for being accommodative to investors.
Agriculture
The Zanu PF manifesto promised to bring finality to the land tenure system by making 99-year leases bankable. Yet banks do not accept the leases as security for loans which has inhibited farmers’ access to key funding to drive agriculture. The manifesto also promised to compensate farmers who lost their land during the land reform programme. On this aspect, the government has set aside ZWL$68m in 2019 and ZWL$380m in 2020 as compensation next year.
Mining
In the mining sector, the manifesto promised to amend the Mines and Minerals Act, enforce the use-it-or-lose-itpolicy, and support beneficiation. Winston Chitando, the minister in charge of the sector, warned recently that big wigs would lose their mining claims if they did not utilise them. Gold leakages triggered by the shock reintroduction of the Zim dollar, and lower-than expected foreign exchange retention thresholds for miners, have been on the rise, prejudicing the economy of millions in hard currency.
Manufacturing
On manufacturing, Zanu PF promised to accelerate the implementation of the ease of doing business reforms and the enactment of the Corporate Governance Bill. Zimbabwe jumped 15 places on the World Bank’s ease of doing business ranking to 140 out of 190 countries on the back of good performance on starting a business, streamlining approvals for construction permits, and a reduction of the business licensing fee. A Corporate Governance Act was launched last week which will clip the powers of ministers in the running of parastatals and state-owned entities.
Energy
In the energy sector, Zanu PF promised to open the sector for business and reduce the licensing fees of independent power producers. It also promised to increase the power generation capacity from the current 1800MW to 3000MW against the national monthly consumption requirement of 2200MW, thereby creating an excess of 800MW. The economy is currently facing rolling power cuts. Reports say more than 80% of companies are experiencing loadshedding of at least 18 hours a day and are losing millions in potential revenue.
Anti-corruption drive
The manifesto promised a corruption free environment in the private and public sectors. This, the manifesto envisaged, would be done through capacitating the democratic accountability institutions such as the Zimbabwe Anti-Corruption Commission (ZACC), Parliamentary Portfolio Committees, Zimbabwe Republic Police (ZRP) and citizens to report incidences of corruption.
ZACC was duly given arresting powers this year and went on to arrest the sitting Minister of Tourism and Hospitality Industry, Prisca Mupfumira, on corruption allegations. The matter is pending at the courts and Mupfumira has since been sacked from office. Analysts say the anti-corruption drive has been targeted at critics of President Mnangagwa.
Health
The manifesto promised health for all, improving infrastructure, attracting skilled health personnel, improving the supply of critical drugs, and adequately equipping health institutions. It also promised to establish at least one hospital in every administrative district, translating to 78 new hospitals by 2023. The sector is currently in intensive care as a strike by doctors has paralysed government hospitals.
Doctors went on strike in September protesting against deteriorating working conditions in which they do not have adequate accessories to perform their duties, and worse the prevailing hyperinflationary environment has wiped out their salaries, and making it impossible for them to come to work and perform their duties properly.
At the time of writing, there was still an impasse – hundreds of the doctors had been sacked, the others were still on strike, patients were at severe risk in doctor-less hospitals, and things were simply not looking good.
Economic development
The Zanu PF manifesto promised the attainment of an economic growth rate of at least 6% per annum over the period 2018-2023. But the economy only grew by 3.4% last year, and is projected to contract by 6.5% this year. Next year, the it is projected to grow by 3%. Zanu PF also targeted a US$5bn annual FDI inflow and a US$10bn domestic investment.
FDI inflows jumped to US$745m last year, from US$349m in 2017, on the back of reforms. But it is still far away from the targeted US$5bn.
Re-engagement
Zanu PF promised to open Zimbabwe for global business, mending strained international relations, strengthening the existing and creating new friendships through re-engagement, and re-building local, regional and international partnerships.
President Mnangagwa has been to global capitals as part of the re-engagement drive under the Zimbabwe is open for business mantra. Zimbabwe’s return to the Commonwealth has hit a snag after London said Harare had not implemented genuine reforms. Critics also argue that Zimbabwe’s foreign policy appears ambiguous and may not achieve its desired results in a complex international political system.
Political analyst Ibbo Mandaza said the Zanu PF government had failed on the reengagement process because it had not been able to attract investors and revive the economy.
“This is one failure that the government has not been able to address despite its efforts, but you will realise that the Western world has not been forthcoming and it has been raising issues of human rights abuse and not very keen to reengage the government,” Mandaza said.
Despite the tough task confronting Mnangagwa, his party was expected to use the conference to re-endorse him as its candidate for the 2023 polls. Eldred Masunungure, the political analyst and University of Zimbabwe lecturer, said Mnangagwa had managed to consolidate power within his party, shutting out any candidate who could dare challenge him at the conference.
“Mnangagwa has been meeting party members to consolidate his support and would be re-endorsed by the critical party organs to show that he is still popular within the party structures,” Masunungure said.
Masunungure does not think that any party member can challenge Mnangagwa at this moment in time. The majority of Zanu PF members are still rallying behind him. He said Zanu PF had been having problems in dealing with the MDC which had managed to get the attention of the international community.
According to him, “the Western world has started to doubt President Mnangagwa’s reengagement programme. The beatings and arrest of MDC activists by the police have brought Zimbabwe back under the international spotlight as the world is watching what is happening in the country. Even though the MDC will not get what it wants, ie, forcing the government to agree to negotiations or a power-sharing arrangement like what is happening in Sudan.”
However, Foreign Affairs Minister Sibusiso Moyo insists that the new dispensation government is ready to re-engage the West, and is working on the normalisation of relationships between the country and the western countries.
“We have realised that our biggest problem to end the isolation of Zimbabwe has been the Western countries and we started refocusing our re-engagement process on the Western world, normalise relations with the UK, Europe and the United States of America,” the Foreign Minister said.
He said the country would continue with the re-engagement programme started by President Mnangagwa which has so far seen him visiting countries, such as China, Russia, Kazakhstan, Belarus and many others in Africa. As part of the efforts to normalise international relations, the government last month held formal political dialogue with European Union (EU) ambassadors in Harare, 18 years after the thawing of political relations between the government and the EU countries.
Whether this will lead to a significant improvement in Zimbabwe’s external relations is anybody’s guess.
