Zimbabwe: The Link Between Politics and the Economy: The Link Between Politics and the Economy

By Godfrey Kanyenze

In this accessible and authoritative book, Godfrey Kanyenze provides a comprehensive and far-reaching analysis of the socio-economic development in Zimbabwe in light of the expanding authoritarianism and the ongoing destruction of democratic institutions during the four decades after independence. Kanyenze describes the various phases of the socio-economic development starting with 1980 when the people of Zimbabwe saw their hard-won independence and new democracy as a promise for a "better life for all". Kanyenze highlights how by dismantling all barriers of economic and legal restraint, and that despite being necessary, The land reform programme put the political and financial interests of the elite before those of the people which continues to this day. Kanyenze reveals the governmental attacks on civil society, and notes how economic policy was not even part of an "authoritarian bargain", an implicit arrangement between ruling elites and citizens whereby citizens relinquish political freedom in exchange for public goods. And he concludes this analysis with a current update of Zimbabwe today, where citizens have nothing -neither political freedom nor public goods. This impressive and gripping account of an authoritarian capitalist system and a country in decline is a must-read for students, researchers, policymakers and those who want to better understand how politics and the economy, interests, conflicts, and power work together.

• Language: English
• Publisher: Weaver Press
• Release date: Mar 31, 2022
• ISBN: 9781779224071

Godfrey Kanyenze

GODFREY KANYENZE is a scholar and development practitioner with over 35 years of experience. He is the Director of the Labour and Economic Development Research Institute of Zimbabwe (LEDRIZ), a research think-tank of the Zimbabwe Congress of Trade Unions (ZCTU). Prior to this he was an economist with the ZCTU and statistician with the Central Statistical Office (CSO) in Harare. Godfrey has worked extensively at both national and regional levels, including assisting governments develop National Employment Policies (NEPs). He currently also serves as Chairman of the Poverty Reduction Forum Trust and is a member of the Technical Committee of the Tripartite Negotiating Forum (TNF). He received his B.Sc in Economics at the University of Zimbabwe, his Masters in Economics at the University of Kent at Canterbury, and completed his Ph.D in Development Studies at the Institute of Development Studies, University of Sussex (UK).

Book preview

List of Tables

Table 2.1: Distribution of Land According to Natural Regions (%) Table 2.2: The Distribution of Income by Race (%)

Table 2.3: Structure of GDP and Employment by Sector for Selected Years

Table 2.4: Economic Policy Plans adopted during the Period 1980-90

Table 2.5: Trends in Major Economic Indicators, 1980-90

Table 2.6: Minimum Wages, Private Domestic and Agriculture; and Commerce and Industry, 1980-90

Table 2.7: Percentage Difference Between Actual and Predicted Average Annual Earnings, 1980-90

Table 3.1: Planned (P) and Actual Lending (A), FY91-01 (US$ million)

Table 3.2: Zimbabwe – World Bank Commitments by Sector, FY80-00 (US$ million)

Table 3.3: Zimbabwe – World Bank Commitments by Sector, FY80-00 (US$ million)

Table 3.4: Trends in Key Economic Indicators, 1991-96

Table 5.1 The Performance of the Economy through Key Macroeconomic Indicators

Table 6.1: Budget Deficit and Borrowing Requirements

Table 6.2 Breakdown of Domestic Credit, 2009-18 (%)

Table 6.3: Global Competitiveness, Ease of Doing Business, Economic Freedom and Corruption Perception Rankings, 2007/08–2019/20

Table 6.4: FDI Inflows, Selected SADC Countries, 2013-2018 (US$ million)

Table 6.5: Household and Individual Measured Prevalence of Poverty – 1995, 2001, 2011 and 2017 (%)

Table 6.6: Zimbabwe’s HDI Trends, 1990-2019

Table 6.7: Percentage of Population Living in Households with Consumption or Income per Person below the Poverty Line (2011 PPP, US$1.90 per day poverty line)

Table 8.1: Integrated policy responses to informality

List of Figures

Figure 2.1 The Inherited Dual and Enclave Economic Structure.

Figure 2.2: Real GDP Growth, Zimbabwe, SSA and World, 1975-2019 (%)

Figure 2.3: Zimbabwe Human Development Index 1980-2019

Figure 5.1: Real GDP Trend (%), 2000-2020

Figure 5.2: Sectoral Share to total Exports (%)

Figure 6.1: Breakdown of Domestic Credit

Figure 6.2: Rankings on Doing Business Dimensions – Zimbabwe, 2018/19 and 2019/20

Figure 6.3: Global Competitiveness Index Rankings, Zimbabwe (out of 141 countries)

Figure 6.4: FDI Flows to Zimbabwe, 1980-2019 (US$m)

Figure 8.1: Schematic illustration of sectoral linkages that can drive re-industrialisation

Figure 8.2: Enhancing the Quality of Jobs Through Structural Transformation

Figure 8.3: Decent work strategies for the informal economy

List of Acronyms

The Author

GODFREY KANYENZE is a scholar and development practitioner with over 35 years of experience. He is the Director of the Labour and Economic Development Research Institute of Zimbabwe (LEDRIZ), a research think-tank of the Zimbabwe Congress of Trade Unions (ZCTU). Prior to this he was an economist with the ZCTU and statistician with the Central Statistical Office (CSO) in Harare. Godfrey has worked extensively at both national and regional levels, including assisting governments develop National Employment Policies (NEPs). He currently also serves as Chairman of the Poverty Reduction Forum Trust and is a member of the Technical Committee of the Tripartite Negotiating Forum (TNF). He received his B.Sc in Economics at the University of Zimbabwe, his Masters in Economics at the University of Kent at Canterbury, and completed his Ph.D in Development Studies at the Institute of Development Studies, University of Sussex (UK).

Acknowledgements

This book is truly a labour of love, emanating from the Youth Leadership Academy at the Friedrich-Ebert Stiftung (FES) where the author facilitated the economic module. Every cohort group of energetic young leaders who partook the training since its inception in 2011 had to undertake a ‘gallery walk’ on the economy, tracing the key milestones since 1980 as well as mapping the outcomes and causal factors. It is through this process that the idea of consummating the knowledge accumulated from successive ‘gallery walks’ into a book took root.

In this regard, the author is indebted to the young leaders that participated in these insightful processes for being the inspiration behind this book. The FES, which did not only host this Youth Leadership Academy, but bought into the idea of putting together this book, and brought it to life, deserve special mention and appreciation. A huge debt of gratitude is owed to its Resident Representative, Dr Ulrich Golaszinski who embraced this idea with great enthusiasm and became the main driving force behind the project. In addition, the FES Programme Officer responsible for that training programme, Aulline Chapisa became the ‘partner in crime,’ pushing hard to ensure that the set timelines were met. Thank you for your dedication to the project that went beyond the call of duty.

As always, my colleagues at LEDRIZ were exceptional in that not only did they help out with the design of some complex tables and graphs, but also became the captive guinea pigs on whom the raw ideas and arguments were tested. You really brought to life the true spirit of collegiality that provided so much wind in my sails. Thank you Dr Prosper Chitambara, Naome Chakanya (who unfortunately left us at the end of June 2021 after 18 years, we wish you all the best at your new station in Turin, Italy), Nyasha Muchichwa, Emmaculate Moyo, Nyaraiwo Gutuza, Isaac Tsaurayi and Clinton Musonza; you are my world.

In addition, so many friends helped in shaping the arguments and unpacking complex issues pertaining to Zimbabwe’s political economy. In the process, an irreparable debt of gratitude was incurred to Professor Brian Raftopoulos, Hugo Knoppert, Dr Dan Ndlela, Dr Joe Muzulu, Deprose Muchena, Herbert Jauch, Masego Madzwamuse, Bella Matambanadzo, Dr Tendai Murisa, Blessing Chiripanhura, Timothy Kondo, the LEDRIZ Board Members, and especially the Chairperson, Florence Taruvinga, as well as the ZCTU under the able leadership of Peter Gift Mutasa.

The choice of Professor Lloyd Sachikonye as the content editor was both aspirational and inspirational, and I am in awe of your great insights and prodding mind. The last word is reserved to our publishers, Weaver Press. I have been honoured and privileged to once again draw from your deep reservoir of editorial finesse! Thanks as always Irene Staunton and Murray McCartney for your meticulous approach to your vocation. What an inspiration working with you, and thank you for your perseverance and accommodating heart that would indulge my excesses and bring me back to the rails with such poise and grace. You are ‘simply the best’ and I am forever beholden to your spirit of camaraderie, we were in it together.

What could I be without the support and encouragement of my family, my dear wife Jullen Kudakwashe, and our two lovely children Rumbidzai Miriam and Ropafadzo Ryan. You simply covered me in unconditional love, for which I am eternally grateful.

Working on this book truly gave meaning to the Bantu expression that ‘umuntu ngumuntu ngabantu’, which literally means that a person is a person through other people. While it is such an honour and pleasure to acknowledge the aforementioned, I however remain solely responsible and liable to the errors of omission and commission, and for the positions taken in this book, which may not necessarily be shared by the above-mentioned colleagues.

Godfrey Kanyenze

August 2021

The crisis consists precisely in the fact that the old is dying and the new cannot be born; in this interregnum, a great variety of morbid symptoms appear.

Antonio Gramsci, Prison Notebooks

Zimbabwe paradoxically stands as one of the world’s most endowed countries when it comes to the abundance of God-given natural resources and human capacities. The fact that in spite of the presence of so much mineral resources and human capacities in our country, we remain unable to utilize the same signifies the need for a total paradigm shift in the way we conduct our economic and financial affairs as a country, as a people, and Government.

February 2009-Monetary Policy Statement

There is nothing more difficult to carry out … than to initiate a new order of things. For the reformer has enemies in all who profit from the old order and only lukewarm support from those who would benefit from the new.

Machiavelli, The Prince

Foreword

In this accessible and authoritative book, Godfrey Kanyenze provides a comprehensive and far-reaching analysis of the socio-economic development in Zimbabwe in light of the expanding authoritarianism and the ongoing destruction of democratic institutions during the four decades after independence.

Kanyenze describes the various phases of the socio-economic development starting with 1980 when the people of Zimbabwe saw their hard-won independence and new democracy as a promise for a better life for all. And the government delivered, even though the country was not in the glorious economic state as representatives of the old regime had wanted to make the world believe.

The discourse continues from the following decade when the partly inherited, partly self-created economic and social problems became apparent and how instead of negotiating a new social contract with its citizens to reconcile the tensions between capitalism’s tendency to increase social polarisation and democracy’s universal premises, the leadership saw their interests being best furthered by weakening the system of liberal democracy and liberal capitalism. The land reform programme – and nobody can question the need for a land reform programme – was the starting point for this strategy.

Kanyenze highlights how by dismantling all barriers of economic and legal restraint, the programme put the political and financial interests of the elite before those of the people; it continues to this day. He discusses the period of the Government of National Unity when the programme was suspended. Brilliantly dissecting the government’s actions since the initiation of the land reform programme, he shows how it has systematically interfered in the existing structure of property and social rights, dismantled trade unions, systematically restructured the media landscape, and undermined the independence of the constitutional court and the judiciary in general. Kanyenze reveals the governmental attacks on civil society, with a particular focus on NGOs financed by international donors, served to delegitimize the extra-parliamentary opposition. He explains how the ruling political elite also systematically took over independent institutions such as the Auditor General’s Office and the Reserve Bank, with every supposedly independent State organ controlled by party loyalists. He notes how economic policy was not even part of an authoritarian bargain, an implicit arrangement between ruling elites and citizens whereby citizens relinquish political freedom in exchange for public goods. And he concludes this analysis with a current update of Zimbabwe today, where citizens have nothing—neither political freedom nor public goods.

This impressive and gripping account of an authoritarian capitalist system and a country in decline is a must-read for students, researchers, policymakers and those who want to better understand how politics and the economy, interests, conflicts, and power work together.

Ulrich Golaszinski

August 2021

1

Introduction, Methodology and Structure

1.0 Introduction

This book emerged out of the Youth Leadership Programme which the Friedrich-Ebert Stiftung has been running since 2011. In the political economy class, as the youth were mapping the ‘gallery walk’, which examines the path the economy has taken since independence in 1980, the Resident Director for Botswana and Zimbabwe, Dr Ulrich Golaszinski, walked into the room where the walls were ‘plastered’ with the milestones that the economy has experienced over four decades. Impressed by the detailed maps and energetic exchanges as the students figured out what happened in chronological sequence, the Director noted that what was pasted on the walls would translate into a useful resource – an idea which crystallised into this book. Fortuitously, the material also covers Zimbabwe’s forty-year journey from independence in April 1980. As the Covid-19 pandemic hit the country in March 2020, it was agreed to include this whole year as well.

1.2 Methodology

The development discourse has undergone radical transformation. In the past, development agencies defined their role narrowly in terms of provision of financial and technical assistance to advance agendas around governance, growth and service delivery. The focus was on what ‘should’ be done without paying much attention to the constraints and opportunities offered by the political environment. Increasingly, both the academic and aid literature has recognised that development, in key respects, is fundamentally a political process (see Bates, 2001; Collier, 2007; Easterly, 2006; DFID, 2009 among others). DFID (2009) illustrates how aid donors are increasingly looking to political economy analysis (PEA) to inform their country-level strategies and activities.

In line with the dictates of the Youth Leadership Programme, it was agreed to pursue a PEA that would reflect the mutually reinforcing influence of politics and economics. This helps to delineate the complexities of economic development where political and economic forces interact and interplay to influence the direction of the economy as well as the outcomes and impacts. Understanding and unpacking the complex dynamics in Zimbabwe would require the adoption of such an interdisciplinary approach. As Ichimura (1998:179) rightly observed, ‘The influence of these non-economic factors seems to be more important, or at least less transparent and non-systematic, in developing countries than in the developed countries.’

According to Collinson (2003: 3), ‘Political economy analysis is concerned with the interaction of political and economic processes within a society: the distribution of power and wealth between different groups and individuals, and the processes that create, sustain and transform these relationships over time.’ (OECD-DAC definition).

As the designation would suggest, political economy is therefore concerned with how political forces influence the economy and economic outcomes. Politics is understood as contestation and bargaining between interest groups that have competing claims on rights and resources. It is equally concerned with economic processes that generate wealth as well as influence how political choices are reached. However, the interactions go both ways, and hence political economy is interested in both as they are closely interrelated and are part of a set of dynamics that impact development outcomes. PEA helps shed light on why states act or perform as they do and why they also formulate the policies that they do. This way, PEA reflects how policies are actually formulated and reflects on the relative importance of vested interest against evidence in policy design.

Critically, economic activity creates the resources required to sustain political activity (e.g. succession struggles, election campaigns, etc.). While policy may result in a particular economic activity blossoming, this success can, in turn, generate a political constituency which has an interest in sustaining that particular economic activity as a group of people now derive benefits from it. Critically, therefore, economic outcomes affect the relative wealth across various groups, and this, in turn, impacts the distribution of political power and the direction of future policy.

PEA is concerned with the way power and resources are distributed and contested in different contexts, and their implications in terms of development outcomes. An important aspect of PEA is its focus on the distribution of wealth, which assumes a central place in terms of who gains and who loses from a particular policy. It therefore provides important clues as to which groups or individuals support the continuation of the policy, as well as which groups might be drawn into a coalition seeking to change it.

Accordingly, PEA probes beneath formal structures to highlight the underlying interests, incentives and institutions that either enable or frustrate change. PEA helps in identifying where the main opportunities and barriers for policy reform lie and how positive change can be promoted. Such an understanding is particularly relevant in fragile and conflict-affected contexts such as Zimbabwe where state and peace building are critical in the promotion of inclusive and stable political settlement. Hence the importance of power and stakeholder analysis to identify the entry points. Furthermore, PEA also helps us better understand the impact of external drivers such as trade, climate change, the media, and donors on domestic governance and political processes. It is critical to recognise the role of donors as political actors as well as providers of aid.

Critically, it is therefore important to understand what shapes political behaviour, which DFID (2009: 4) identified as involving:

•Interests and incentives: ¹ where those with ability to influence policy do so in order to further their own economic and/or political interests. While those outside of government may be concerned with economic outcomes, those inside government may have their own private economic interests, as well as political interests, especially regarding retention of their positions of power.

•Values and ideas : alongside direct economic or political interests, ideology is also an important driver of policy. Ideology provides a guide as to what people can do to remain consistent with their basic beliefs and values. Incorporating ideas or ideology as part of political economy recognises that other factors besides self-interest may motivate some political action as some people enter politics in order to make the world a better place, even though this emphasis may later change.

•Institutions : institutions are the formal or informal ‘rules of the game’ that inform human behaviour. Formal political rules, include a constitution, that provides guidance as to how leaders are chosen and new policy introduced. However, in practice, informal norms and ways of doing things may be as influential in shaping actual outcomes. These rules help to structure the incentives facing political actors.

DFID (2009: 8) also outlines the tools of political economy analysis that are relevant to three levels:

•Macro-level or country analysis : where it is important to understand how the big decisions, such as selection of political leaders or the allocation of budgets, are made. At this level, the most powerful interest groups will be visible. Such macro analysis will include considering how the highest level political institutions function: the rules of the game facing influential political players, how a country’s history helps shape prevailing ideologies and ideas about how things should work and why.

•Sector-level analysis : examines in-depth the forces shaping policy formation and decision-making at the level of the individual sector or industry. The more important and prominent the sector is in the economy, the more likely national level forces will influence decision-making within the sector. Some actors who do not feature at national level may exert influence over outcomes in their particular sector. Sectoral and local rules will be critical to outcomes and may be fiercely contested by the relevant players.

•Problem-driven analysis : a highly practical approach that identifies a particular problem to be solved and proceeds to examine all the forces (actors and interests, ideas, institutions) that have a bearing on it. The World Bank developed this approach to explain how policy reforms that were desirable from a growth or poverty reduction perspective seemed to be continually blocked.

It is important to note that sector-level and problem-focused exercises are not alternatives to macro-analysis. They simply allow the issues to be explored more deeply, closer to where the operations take place. In fact, sector-level and problem-driven analyses start from the assumption that a satisfactory macro-level analysis is already in place and seek to build on it.

On the understanding that the same general approach can be applied to the analysis of political economy issues in developed and developing countries, Drazen (2008) posits that the main elements of the model are political actors, their objectives and the mechanisms by which political decisions are made (i.e. institutions), and distinguishes four groups of actors within a political economy system, namely:

•Policy-makers : who may or may not have been elected, and those tasked with implementing policy, who may be members of the bureaucracy or civil service.

•Citizenry : in the Drazen model, citizens do not exert any influence over decision-making. However, policy-makers are assumed to take their preferences into account when designing policy.

•Selectorate : citizens only exert influence over decision-making if they are also part of the selectorate, ‘the group who actually selects leaders or who control the instruments of power that enable a leader to remain in office’. In a democracy, this equates to the electorate. However, in most real world democracies, certain individuals and groups – for example, media barons and powerful interest groups – wield more power than others and exert particular influence over the choice of leaders and policies, due to their ability to finance political campaigns or to influence voting behaviour in other ways. In dictatorships, the selectorate is the powerful individuals and groups (often quite small in number, but likely to include the heads of the armed forces and security services) that keep the dictator in power or, alternatively, have the capability of removing him if they are not sufficiently rewarded by his rule.

•Coalition : in practice, the leader does not need the support of all the whole selectorate; just sufficient of them to keep him in power or to approve a particular policy. In a democracy, the coalition is the electoral majority required to vote the government or leader in, plus the interest groups or other financiers required to fund the election campaign.

In terms of political actors’ interests, Drazen argues that the utility functions of political leaders are likely to include general societal welfare, ideological preferences for particular outcomes and their own private interests. Their primary private interest is generally assumed to be the acquisition and/or retention of power, as this is the key to enjoying the ‘perks’ of office, whether these perks are prestige, power for its own sake or the financial benefits that can flow from being in office. Political leaders are individual human beings, so the relative weightings that they attach to societal welfare, ideological preferences and their own private interests will vary from individual to individual. One would expect that a leader who attached greater weight to the pursuit of societal welfare and less to their own private interests would generate better policy outcomes for the majority of people in his/her country.

If it is the selectorate that is the key component of Drazen’s model, then it is the interests and objectives of the selectorate that drive policy outcomes. This is because political leaders have to keep enough of the selectorate happy in order to retain power.

1.3 Beyond the Traditional Conceptualisation of Development

The choice of PEA as the guiding philosophy is underpinned by an alternative development paradigm that sees development as much more than growth of GDP. The Nobel Prize Laureate, Amartya Sen, characterised development as freedom where expansion of human freedom is viewed as both the primary end as well as principle means of development. As such, development is seen as a process of expanding the real freedoms that people enjoy. While growth of GDP or individual incomes can be an important means to expand the freedoms enjoyed by members of society, freedoms depend also on other factors such as social and economic. arrangements (e.g. facilities for education and health care) as well as political and civil rights (e.g. liberty to participate in public discussion and scrutiny).

Looking at development in terms of expanding substantive freedoms focuses attention on the ends as opposed to merely stressing some of the means that are a part of the process. Therefore, development would entail removal of major sources of ‘unfreedom’, namely, poverty, tyranny, poor economic opportunities and systematic social deprivation, neglect of public facilities, intolerance or actions of repressive states. The argument is that what people can achieve is shaped by economic opportunities, political liberties, social powers, and enabling conditions of good health and basic education. Sen argued that ‘development’ should not simply be viewed in terms of economic measures (e.g. GDP growth, average annual income), but in terms of real ‘freedoms’ that people can enjoy. To him, human freedom is both the primary end objective and the principle means of development. Economic measures are seen as the means to this end.

This way of articulating development as freedom brings to the fore multidisciplinary insights from politics, economics, ethics, demography, and sociology. Thus, Sen frames development as the realisation of freedom and the abolition of ‘unfreedoms’ such as poverty, famine, and lack of political rights. As such, development is contextualised in both economic and political terms. To enhance human capabilities would therefore require the elimination of such ‘unfreedoms’ as child labour and famine. Critically, development is framed in political terms. In this framework, poverty is seen as ‘capability deprivation’ that limits an individual’s realm of choices.

This thinking informed the concept of human development adopted by the UNDP in 1990 defined as ‘a process of expanding people’s choices by enabling them to enjoy long, healthy and creative lives’. To this concept was added the aspect of ‘sustainability’, framed by the Brundtland Commission report of 1987 as development that meets the needs of the present generation without compromising the ability of future generations to meet their own needs. Sustainable human development (SHD) puts people at the centre of the development process, and its central tenet involves the creation of an enabling environment where people can enjoy long, healthy and creative lives.

In the context of human development, growth is seen as a means rather than an end in itself. Such an approach acknowledges that a country may achieve high levels of growth, but that does not mean it has a high level of human development. Economic growth is therefore a necessary, but an insufficient condition for SHD. What is critical for human well-being, therefore, is the quality and distribution of growth, not just its quantity. This way of looking at development has implications in terms of the role of the state. Under the human development strategy, the state ought to play a leading and strategic role in expanding capabilities and opportunities, and in ensuring that growth is broad-based, inclusive (shared) and pro-poor.

The principles guiding SHD therefore include the following:

•Ethical development that does not violate human rights;

•Equity – less disparities between groups;

•Inclusion – broad-based approach to growth and development;

•Human security – promotion of stability and minimisation of the vulnerability of people;

•Sustainability – less environmental destruction;

•Human development – no poverty and deprivation.

In the apt words of the UNDP (2010: 12):

The economics of growth and its relationship with development, in particular, require radical rethinking. A vast theoretical and empirical literature almost uniformly equates economic growth with development … The central contention of the human development approach, by contrast, is that well-being is about much more than money: it is about the possibilities that people have to fulfill the life plans they have reason to choose and pursue. Thus, our call for a new economics – an economics of human development – in which the objective is to further human well-being and in which growth and other policies are evaluated and pursued vigorously insofar as they advance human development in the short and long term.

The new Constitution adopted in 2013 takes this rights-based approach to development, inclusive of human and socio-economic rights. Section 13 on national development emphasises the need to facilitate rapid and equitable development, and in particular ‘bring about balanced development of the different areas of Zimbabwe, in particular a proper balance in the development of rural and urban areas.’ Section 13(3) makes reference to the need to ‘…protect and enhance the right of the people, particularly women, to equal opportunities in development.’ Section 14(1&2) on empowerment and employment creation obliges state and all institutions and agencies of government at every level to facilitate and take measures to empower marginalised persons, groups and communities in Zimbabwe to create employment for all Zimbabweans, especially women and youths.

The importance of domestic ownership of policies and programmes is also highlighted as critical. Section 13(2) of the Constitution obligates Government to ‘…involve the people in the formulation and implementation of development plans and programmes that affect them.’ This is reinforced through Section 3(a) of the TNF Act (signed into law on 5 June 2019) which provides as the function of the TNF the need to ‘Consult and negotiate on social and economic issues and submit recommendations to the Cabinet’. Section 3(c) says the function of the forum shall be to ‘foster cooperation of the tripartite constituents and consult other key stakeholders and contribute to the formulation and implementation of social and economic policies.’ In addition, Section 3 (e) talks about generating and promoting a shared national socio-economic vision.

1.4 Policy Frameworks, 1980-2020

Since independence in 1980, Zimbabwe has adopted no less than 17 economic blueprints:

i. Growth with equity (1981);

ii. Transitional National Development Plan (1982-1985);

iii. First Five Year National Development Plan (1986-1990);

iv. Economic Structural Adjustment Programme (ESAP) (1991-1996);

v. ZIMPREST (1996-2000);

vi. Millennium Economic Recovery Programme (MERP), 2001-02;

vii. Ten Point Plan based on Agriculture (2002);

viii. National Economic Revival Programme (NERP) (2003);

ix. Macroeconomic Policy Framework (2005-2006);

x. National Economic Development Priority Programme (NEDPP) (2007);

xi. Zimbabwe Economic Development Strategy (ZEDS) (2008) (aborted at Conception);

xii. Short Term Emergency Recovery Programme (STERP I) (2009-10);

xiii. Short Term Economic Recovery Programme (STERP II) (2010-12);

xiv. Medium Term Plan (2011-15);

xv. ZimAsset, October 2013–December 2018 & Ten-Point Plan, August 2015

xvi. I-PRSP (2016-18) & Sustainable Development Goals (SDGs), 2016-2030.

xvii. Transitional Stabilisation Programme [TSP (October 2018-December 2020)] & Staff Monitored Programme, May 15, 2019-March 15, 2020.

It is important to note that these economic plans are derived from different ideological perspectives, from statist to more market-oriented approaches, a volte-face as with ESAP and TSP (see Jenkins, 1997). From a PEA perspective, it is critical to understand how a government can change course so dramatically. Since ZIMPREST, the programmes became short term as government was grappling with an emerging crisis. The MTP represents the return to medium term planning. Experience suggests that government has been long on planning and short on implementation, with regular changes to the programmes, policy incoherence and inconsistency, and even reversals. With the adoption of ZimAsset after the July 2013 Harmonised Elections, the MTP was effectively been unilaterally abandoned in midstream. The rationale was that after the landslide victory by the ZANU-PF Party in the 31 July 2013 harmonised elections, the party was given the mandate to govern the country for a five year term.

1.5 Structure

Following the structure employed in the political economy class, this book is based on the five phases / epochs or sub-periods characterised by structural break in policy over the period 1980-2020. Clearly, the first decade of independence (1980-90), with its continuity and social welfare thrust constitutes a distinguishable phase. This will become Chapter 2 after this introductory chapter. The next phase with a distinct policy break is the period of ESAP, 1991-96, when the country shifted from a state-led to a more market-driven economy. This constitutes Chapter 3. Chapter 4 is based on the decade of discernible crisis, 1997-2008, when the economy underwent a sustained, broad-based decline.

The Global Political Agreement of September 2008 resulted in the formation of the Government of National Unity (GNU) in February 2009, which ran until the elections of July 2013. This phase can be differentiated by the adoption of multi-currencies and fiscal discipline, which returned the country to macroeconomic stability and economic rebound. Thus, the GNU Period from 2009 to July 2013 constitutes Chapter 5. Finally, the Post-GNU period is also distinct as it marks the end of the GNU and the return of a ZANU-PF government. Intensified factional fights, fiscal indiscipline, policy inconsistency and contradictions characterised this sub-period. However, during the process of the analysis and writing, it became clear that even this period could be distinguished between the Post-GNU Period Under Mugabe, August 2013-November 2017, which would become Chapter 6, and the Post-Mugabe Period, November 2017-2020, which now constitutes Chapter 7. These phases/epochs capture the evolution of the economy and the associated dynamics. Finally, Chapter 8 offers a synthesis, and provides the way forward.

References

Bates, R. (2001) Prosperity and Violence: The political economy of development. London and New York: W.W. Norton.

Collier, P. (2007) The Bottom Billion: Why the Poorest Countries are Failing and What Can be Done About It. New York: Oxford University Press.

Collinson, S. (ed.) (2003) ‘Power, Livelihoods and Conflict: Case Studies in Political Economy Analysis for Humanitarian Action’. Report No.13, Humanitarian Policy Group. London: Overseas Development Institute.

DFID (2009) ‘Political Economy Analysis: How to Note’. DFID Practice Paper. London: Department for International Development,.

Drazen, A. (2008) ‘Is there a different political economy for developing countries? Issues, perspectives and methodology’, Journal of African Economies, 17(1), pp. 18-71.

Easterly, W. (2006) The White Man’s Burden: Why the West’s Efforts to Aid the Rest Have Done So Much Ill and So Little Good. New York: Penguin.

Ichimura S. (1998) ‘The Political Economy of Policy-Making’, in S. Ichimura, The Political Economy of Japanese and Asian Development. Tokyo: Springer.

Jenkins, C. (1997) ‘The politics of economic policy making in Zimbabwe’, The Journal of Modern African Studies, 35(4), pp. 575-602.

UNDP (1990) ‘Human Development Report 1990. Concept and Measurement of Human Development’. New York: UNDP.

UNDP (2010) ‘Human Development Report 2010 20th Anniversary Edition. The Real Wealth of Nations: Pathways to Human Development’. New York: UNDP.

____________

1Incentives refer to the driving forces of individuals and organised group behaviour. They depend on a combination of factors including, (i) the individual’s personal motivations (material gain, risk reduction, social advancement, spiritual goals, etc.); and (ii) the opportunities and constraints arising from the individual’s principal economic and political relationships (DFID, 2009: 26).

2

The First Decade of Independence, 1980-90

2.0 Introduction

The liberation war ended following the Lancaster House conference held in London, in December 1979, which culminated in the country being granted independence from Britain in April 1980. After winning the March 1980 elections, the Zimbabwe African National Union – Patriotic Front (ZANU-PF) led by Robert Mugabe took over political power and formed the first post-independence government. The expectations were naturally high – in fact euphoric – following 90 years of colonial rule. Black Zimbabweans wanted immediate tangible proof that they were indeed free at last, hence during the period leading to the inauguration of the first black government, the nation was engulfed in nation-wide strikes emanating from ‘a crisis of expectations’.¹ While these were naturally high on the part of the black majority, the anxieties were equally high within the white community frightened at the prospects of black majority rule, given years of Smith propaganda and perceptions that Mugabe would introduce socialism and expropriate their assets.²

Thus, upon assumption of power in 1980, the new government faced significant constraints and difficult policy choices. On the one hand, a central objective related to the need to address the severe inequalities which were a legacy of past racial prejudices; and, on the other, the government recognised the importance of maintaining ‘…the health and vitality of the productive sectors of the economy, which were dominated by whites,’ (Dashwood, 2000:4). It is reported that Mugabe’s own experiences in Mozambique had impressed upon him the need to guard against a rush of revolutionary zeal that would result in out-migration of indispensable white skills as happened in Mozambique upon gaining independence in 1975 (see Stoneman, 1989; Martin and Johnson, 1981).³ The message was reinforced when Julius Nyerere of Tanzania advised his erstwhile colleague on the eve of independence that he had inherited ‘a jewel in Africa’ and must ‘preserve it’ (see Kanyenze et al., 2011:1).

Mugabe and his ZANU-PF colleagues had experienced first-hand the daunting challenges Frelimo faced at independence (see Martin and Johnson, 1981). As the colonial state in Mozambique had made little effort to ‘Africanise’ the bureaucracy, with the Portuguese making up the bulk of the country’s professional and managerial class, their exodus at independence left behind a weak administrative structure. As Finnegan (1992) observed: ‘Frelimo was left to run an effectively bankrupt country with virtually no trained people. The illiteracy rate was over 90%. There were six economists, two agronomists, not a single geologist, and fewer than a thousand black high school graduates in all of Mozambique. Of 350 railroad engineers working in 1975, just one was black and he was an agent of the Portuguese secret police,’ (1992: 30). It is reported that President Samora Machel advised Mugabe just before his return home from exile in January 1980, ‘Don’t play make-believe Marxist games when you get home … You will face ruin if you force the whites into precipitate flight.’⁴

In his independence eve broadcast to the nation, the new Prime Minister, Robert Mugabe, made it clear that, ‘Our new nation requires every one of us to be a new man, with a new mind, a new heart, and a new spirit. Our new mind must have a new vision and our new heart a new love that spurns hate, and a new spirit that must unite and not divide. This to me is the human essence that must form the core of our political change and national independence.’⁵ As expressed in his victory speech as Prime Minister-designate on 4 March 1980, peace and stability were uppermost in Mugabe’s mind. In his conciliatory tone, ‘Surely this is now time to beat our swords into ploughshares, so we can attend to the problems of developing our economy and our society.’

Ominously, he insisted that, ‘Only a government that subjects itself to the rule of law has any moral right to demand of its citizens obedience to the rule of law.’ Hence, the fear of ‘the lowering of standards’ and the imperative of preserving the inherited economic edifice resulted in the adoption of a pragmatic approach steeped in the implementation of a ‘welfarist approach’. This gradualist approach was embedded in the Transitional National Development Plan (TNDP), where it was stated that: ‘…While the inherited economy, with its institutions and infrastructure, has in the past served a minority, it would be simplistic and, indeed, naïve to suggest that it should, therefore, be destroyed in order to make a fresh start. The challenge lies in building upon and developing on what was inherited, modifying, expanding and, where necessary, radically changing structures and institutions in order to maximise benefits from economic growth and development to Zimbabweans as a whole,’ (Zimbabwe, 1982: 1).

2.1 The Economy at Independence

2.1.1 The Dual and Enclave Economic Structure

In order to fully comprehend the scale of the challenges faced by the post-independence government, it is necessary to reflect on the nature of the inherited economy. At independence, Zimbabwe inherited an economy that had been moulded on the basis of an ideology of white supremacy, resulting in ‘separate development’ – economic dualism. Essentially, at its advent, colonial capitalism captured a small segment of the economy, the formal sector, and left the bulk of the economy (non-formal segment) under pre-capitalist (traditional) modes of production.⁶ As such, this disarticulate structure of the economy implies that the formal sector has a growth momentum of its own, and relates to the non-formal segment in a manner that marginalises and impoverishes the latter, resulting in uneven development.

The dual economic structure is reflected in the existence of a relatively developed and modern formal sector, co-existing with a relatively backward and neglected traditional non-formal (communal and informal) segment, home to 70% of the black population. The social formations this entails reflect the co-existence of capitalist (in the formal sector) and pre-capitalist (in the non-formal segment) modes of production that have been fused together in a rather uneasy and tenuous manner – grafted capitalism (see Mhone, 2000).

In addition to its dual structure, the economy exhibited an enclave nature in the lack of linkages between the two segments of the economy, with the most dynamic part of the Zimbabwean economy, the formal sector, which accounted for the greater part of gross domestic product and employed about one fifth (one million) of the potential labour force, more linked to the external than the internal economy. This enclave relationship is largely determined by the fact that the performance of the formal sector is influenced by external market conditions for the export of primary goods and on the importation of capital and intermediate goods. Because of the external links, the formal sector therefore depends less on the non-formal sector for its growth. The tragedy of such an economic structure is that the majority of the labour force, mainly women and youth, is trapped in pre-capitalist forms of production which are not driven by the need to employ labour to generate profit and the further expansion of capital – capital accumulation.

Thus, the enclave and dependent nature of the Zimbabwean economy is not only mutually reinforcing in marginalising the non-formal sector, but also imparts dualism to the economy. The majority of the labour force constituting about four fifths, were either under-employed in the non-formal sector, or openly unemployed. Critically, the formal sector has its own growth momentum that is relatively isolated from that of the non-formal sector. As such, the non-formal sector is linked to, and dominated by the formal sector in a highly exploitative manner as a buffer for those retrenched in the formal sector, and also as a reservoir of cheap labour for the formal sector, as well as producing some food requirements of the latter sector. Most activities in the non-formal sector are characterised by weak and involutionary growth, with few employment opportunities and low wages.⁷

Figure 2.1 The inherited Dual and Enclave Economic Structure.

Technically efficient enterprises are few in the non-formal sector such that too many people are working on a survival (subsistence) basis, being trapped in a low productivity, low income trap. This structural distortion therefore implies that even in the presence of growth, the economy is unable to absorb the vast numbers of the un- and under-employed into the mainstream economy. In the formal segment, production involves the use of reproducible capital (including advanced technology), and

Reviews for Zimbabwe

[David Makora · Rating: 4 out of 5 stars]

It very enlightening on how to understand the political and economic trajectory of Zimbabwe since independence