President Emmerson Mnangagwa’s hope that the 2018 elections would deliver the legitimacy he so desired was marred by the shortcomings of the electoral process, the post- election violence on August 1, the continued lack of recognition of his victory by the opposition and the critical reports of international observers.
The Government of Zimbabwe’s planned political and financial re-engagement strategies, much-touted in the presidential narrative since the November coup, continue to face the hurdles of deeper economic and political reform that have been the precondition for such re-engagement.
Predictably, the continuing crisis of the economy immediately grounded any post-election optimism in the ruling party. The indicators of the crisis were patently apparent. These include: A long-term currency crisis that has resulted in cash shortages; a major budget deficit estimated at US$3,3 billion in 2018 as a result of largely unaccountable state expenditure; rapid price increases and accelerated inflation; the large-scale use of Real-Time Gross Settlement payments in the economy chasing a small supply of US dollars and fuelling a parallel currency market; a massive accumulating foreign and domestic debt of US$16,9 billion.
These indicators are reflective of a government policy which in Tony Hawkins’ assessment has resulted from a combination of currency overvaluation, government overspending and credit creation to finance budget deficits.
Moreover, as economist Godfrey Kanyenze of the Labour and Economic Development Institute of Zimbabwe (Ledriz), which is affiliated to the Zimbabwe Congress of Trade Unions (ZCTU), has noted, there is not just a liquidity crisis in Zimbabwe, but a major leakage of state funds due to weak state accountability.
Since the Mugabe years, a great deal of state funding has been funnelled into certain enclaves of the state elite away from any long-term developmental investment. Moreover, the practices in the private sector have also fed into the crisis. As a Ledriz briefing on the 2017 Commission of Inquiry into the Conversion of Insurance and Pensions Values from ZW$ to US$ reported, the accumulation of profits by pension companies as a result of the removal of 25 zeros during the between 2006 and 2009, resulted from “insurance companies technically extinguishing their obligations to policy-holders and pensioners without actual payments”. As a result, “assets that were supporting insurance companies’ pension liabilities were transferred to shareholders of insurance companies or became surpluses in some defined pension benefit funds”.
Among the first responses from the new technocratic Finance minister Mthuli Ncube was to place an increased tax on the working people of Zimbabwe. This amounted to a payment of 2 cents on every electronic dollar payment of over $10. Ncube also announced plans to reduce the public sector budget and the privatisation of parastatals. The immediate response of the ZCTU was to call for national protests against the 2 cents tax, a call that was greeted with widespread pre-emptive arrests of trade union leaders by the state.
In the face of these challenges, the Mnangagwa government has been desperate to move the discussion with the international financial institutions forward. However, the international players are finding it difficult to make progress on this issue. On the one hand, countries in the European Union (EU) are keen to move the re-engagement along and to avoid any further deterioration of the Zimbabwean economy. In their view, a further weakened Zimbabwean state would not be in their interests. On the other hand, the EU has reiterated its demands for both political and economic reforms before any further economic re-engagement can take place.
The final report of the EU Observation Mission made it clear that while there had been progress in the pre-election campaign period, in the end the right to an effective legal remedy was not adequately provided for and the lack of equal suffrage and “shortcomings in the registration of voters compromised universal and equal suffrage”.
This judgment, combined with the continued Zimbabwe Democracy and Economic Recovery Act legislation in the US means that there is unlikely to be any major movement on international financial assistance to the Mnangagwa administration in the medium-term. In this context, the international forces understand that they have substantial leverage on the Government of Zimbabwe but it is pressure that also has limits which they are not keen to push too far. They would prefer their diplomacy to encourage the government to intensify its actions on the reform agenda while also understanding the costs of failure. They also understand how quickly the defensive language of national sovereignty, with regional and continental support, will confront any more explicit political conditionality.
Already the pressures on the present regime are leading to tensions in the ruling party. Old guard Zanu PF officials who were moved out of Government into the party machinery after 2018 have started accusing the new Finance minister of not consulting the supreme structures of the ruling party on the new policies. We should expect more such attacks. The factionalism that has plagued Zanu PF for much of its history and intensified after 2014 and in the lead up to Mugabe’s removal has not gone away.
The close outcome of the 2018 presidential election as opposed to the strong parliamentary results of the ruling party left Mnangagwa with little doubt about the precarious nature of his presidential position. The coercive response to the planned trade union protests could also be indicative of Zanu PF’s return to more coercive politics in the face of unrelenting economic decline.
In response to the current conjuncture, Nelson Chamisa’s MDC Alliance has maintained its refusal to accept the legitimacy of Mnangagwa’s presidential election victory. In pursuing this objective, the opposition has adopted a dual strategy: a combination of protests and the hope of international pressure. The thinking behind this strategy is that the cumulative economic crisis and international constraints will force the Mnangagwa regime into conceding to their demands for a renegotiation of power. There are several problems with this approach.
Firstly, as we have seen in other parts of the continents crisis authoritarian states can maintain their rule for long periods of time through minimalist state forms of rule that combine a control of certain extractive forms of revenue with command over the central means of coercion. Moreover as Paul Nugent points out such states can combine coercive, productive and permissive forms of rule involving varying relations of coercion and consent and different episodes of negotiations and conflict between states and citizens. The reductionist view that economic crisis will deliver what the election could not is extremely precarious.
Secondly, the social base of the opposition, particularly in the now largely informalised urban sector, is likely to be further weakened by a deepening economic crisis. This is unlikely to result in more protests and a strengthening of the opposition presence in the public sphere. It could lead to a further retreat into individualised forms of survival and already well supported religious structures and their more optimistic ethereal futures.
Thirdly, the international pressure that the opposition is counting will not take the forms of more open political conditionality in favour of the opposition. At present, key players in the international community are more concerned with keeping Zanu PF on the reform agenda than with any more open or surrogate support for the opposition as in the past. For many countries in the EU the stabilisation agenda in countries like Zimbabwe remains a key factor in the face of all the changes in European politics, particularly around the massive migration issue that is currently dominating European politics.
Moving forward, there is clearly a need for a new national dialogue, including but not just limited to, the major political parties. It should also include a broad range of civic interests. In the recent past ,there have been calls for such a dialogue from Concerned Citizens and Churches. Even if Zanu PF is not yet ready for such an initiative, the need for it is increasingly clear.
While there are clear differences between Zanu PF and the MDC Alliance, the parties have moved closer together on their neo-liberal economic agendas. The TINA (there is no alternative narrative) position of the Thatcher/Reagan years has become the common sense of both parties. As it stands, it is the terms of this macro-economic stabilisation programme as well as political reforms that could be the start of such a national discussion.
Hopefully, this could also lead to a serious critique of this currently shared economic policy.
Raftopoulos is director of research and advocacy at Solidarity Peace Trust and a research fellow at the International Studies Group, University of the Free State, South Africa.
Originally posted on Zimbabwe Independent: The Leading Business Weekly