From 2000 to present, Zimbabwe’s economy has been on a slippery slope.
FOR the first time in many years, Zimbabwe appears seriously committed to breaking the economic isolation jinx that has haunted the country since 2000.
Earlier this month, Zimbabwe extended its begging bowl to Western capitals for the first time since falling out with the United States, Britain and their allies over its controversial 2000 land reforms that forced the southern African nation to look east, mainly to China.
Through its much hyped “Look East Policy”, government had hoped to plug the trade deficit caused by its isolation but the strategy has had mixed outcomes.
From 2000 to present, Zimbabwe’s economy has been on a slippery slope.
While the adoption of a multicurrency regime in February 2009 eased the economic pressures, Zimbabwe is now finding the going much tougher in a hard currency environment.
Although trade with China has been looking up, it is becoming clear to the ZANU-PF government that the “Look East policy” alone cannot pull the country’s economy from the precipice.
Without openly admitting to the country’s citizens that they had been led down the garden path for years, Zimbabwe has lately been making overtures beyond its “all-weather” Asian allies.
Analysts reason that this could be a tacit admission on the part of President Robert Mugabe’s government that they could not go it alone without support from Britain, the US and their allies.
Patrick Chinamasa, the Finance Minister, recently led a team that met with Western ambassadors and representatives from the International Monetary Fund (IMF), the World Bank and the African Development Bank to discuss direct budgetary support.
Western nations have often accused President Mugabe’s government of election rigging and human rights abuses and have, since 2002, restricted funding to charities and non-governmental organisations.
Without balance of payments support from the IMF and the World Bank, Zimbabwe has perennially failed to balance its books.
Because other countries tend to take a cue from the Bretton Woods institutions, Harare has been more like the Biblical leper in the international community.
Chinamasa has of late been frantically knocking on the doors of financers to assist Zimbabwe ease its liquidity crisis.
And when he met diplomats from western countries he couldn’t hide the country’s desire to normalise relations with its foes.
“As we go forward and as we successfully build trust among ourselves, we can in future channel development assistance through the vote of credit (budget) so that we are able to plan more effectively and more efficiently,” he told the gathering.
Charles Mangongera, a senior research fellow at SAPES Trust, said attempts to unlock direct funding from the West smacked of desperation on the part of the Zimbabwean government.
He said the “Look East policy” has clearly failed and government has now realised that China and other eastern countries, just like the West, are looking for bankable investment projects and will not dish out money like confetti.
“The government needs to realise that it will not be able to attract investment capital until it demonstrates a firm commitment to respecting the rule of law and property rights especially…,” said Mangongera.
Zimbabwe’s budget is entirely funded by tax revenue collected by the taxman, the Zimbabwe Revenue Authority, which has faced difficulties in meeting revenue targets simply because the tax base is shrinking as the economy increasingly becomes informal.
China–Zimbabwe relations date back to the days of the liberation struggle in the 1970s.
While the then Soviet Union was closer to Joshua Nkomo’s ZIPRA, ZANLA enjoyed support from Beijing.
And in April 1980, Zimbabwe and China formally established diplomatic relations.
Despite that effort, Zimbabwe didn’t do much to transform its political ties into tangible economic benefits for both countries.
It was only in 2003, following Harare’s standoff with the European Union that Zimbabwe sought to strengthen its economic ties with the eastern bloc to stem the capital flight and economic depression.
However, there are increasing signs that China remains apprehensive about their relations with Zimbabwe and prefer to concentrate their political capital on countries with oil reserves.
Chinese’s former president Hu Jintao did not visit Zimbabwe on his February 2007 tour of southern Africa, though his schedule took him to a number of countries near Zimbabwe, including Mozambique, Namibia, Zambia and South Africa.
The Zimbabwean side is also ambivalent about the increasing Chinese influence on the economy; Zimbabweans have complained about the low quality of Chinese goods, including buses.
Zimbabwe is not the only country to pursue the “Look East policy”.
India’s Look East policy represents its efforts to cultivate extensive economic and strategic relations with the nations of Southeast Asia in order to bolster its standing as a regional power and a counterweight to the strategic influence of the People’s Republic of China.
Initiated in 1991, it (Look East policy) marked a strategic shift in India’s perspective of the world.
But unlike Zimbabwe which sought to spite the US, Britain and their allies, India embraced all global economies in doing business.
In his analysis of Zimbabwe’s “Look East policy”, Jeremy Youde, an academic, gave a background to what inspired this strategy in Zimbabwe.
He wrote: “As part of its ‘Look East’ foreign policy strategy, Zimbabwe has sought to strengthen its ties with China—a move that has alarmed many Western states. While not necessarily denying the pragmatism behind such a strategy, I examine how this policy represents an attempt by the Zimbabwean government and its leader, (President) Robert Mugabe, to redirect the public imagination toward a different identity at the domestic and international levels. The government seeks to draw on its image as a freedom fighter and liberator to shore up its domestic legitimacy, while simultaneously reasserting its role as an important international actor. The rhetorical strategy used by (President) Mugabe and his government has had material benefits, but its success in redefining Zimbabwe’s identity has been decidedly mixed.”
The ZANU-PF government has often pointed to China’s large haul of Zimbabwe’s tobacco crop as an indication that its “Look-East” policy was successful.
A State trip to China last year by President Mugabe and top government officials was also hailed as having resulted in “mega-deals”, which are, however, yet to materialise.
Leader of the Movement for Democratic Change, Welshman Ncube, said ZANU-PF was oblivious of the extent it had turned the country into a beggar nation, while it continued to speak of mega deals with Russia, China and South Africa.
“…It does not matter how endowed or rich a country is; its development agenda cannot be complete without friends. International friendship – garnered through economic blocs like ECOWAS, SADC, COMESA; political gatherings like the United Nations and the African Union – is critical for us all.
“It is the capillary, the umbilical cord through which crucial financial, technical and trade support flows to any country, especially poor countries like Zimbabwe,” said Ncube.
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