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Tuesday, December 5, 2017

LESSONS FROM ZIMBABWE

On Tuesday President Robert Mugabe threw in the towel and resigned as Zimbabwe’s leader, forced in to this decision by a military takeover that was not a military takeover.

Last week the military put the aging president under house arrest following an unprecedented warning just hours before, that the army would not allow the purging of the Independence veterans to go on unabated. The latest victim was former vice president Emmerson Mnangagwa whose dismissal at the beginning of the month, it was suspected,  paved the way for first lady Grace Mugabe to take over and be first in line in the event that Mugabe stepped down or worse.

Grace, who is at least 40 years younger than her husband, is not popular with the “comrades” and they saw her as a real threat to their cozy living if ever she assumed power.

"It doesn’t help too, that Grace's  conspicuous consumption and ostentatious living has continued in recent years, despite the collapse of the economy and the widespread suffering of Zimbabweans...

The seeds of Mugabe’s downfall were planted in colonial times.

The takeover of more than half the arable land of Zimbabwe by the colonial government and the settlers, relegated millions of Zimbabweans to marginal land that they struggled to eke a living from.

In hindsight on attainment of black majority rule in 1980, a robust land distribution process which walked a tight rope between getting more farmland to the blacks and maintaining the productivity of the agricultural sector should have been embarked on with a sense of urgency.

What happened of course, is that Mugabe and his cronies parcelled out the land from initial land redistribution efforts to themselves, leaving a lot of his countrymen feeling shortchanged and disenchanted.

This disillusionment was leveraged by his opponents and in an effort to hang on to power Mugabe   forcefully redistribituted land starting in 2000 whose net effect has been to collapse the productivity of the agricultural sector.

"While he hang on to power, barely, the ripple effect from this political expediency has affected industry, services, the general economy to the point that the once food basket of South Africa cannot feed itself, they now use the US dollar as their currency because the Zimbabwe dollar was decimated by hyperinflation and for all intents and purposes Zimbabwe is teetering on the edge of economic ruin....

The official figures show that the real incomes of the average Zimbabwean are now down to the levels they were at around the end of the Second World War, a fifth of Zimbabweans now live outside the country and the billions of dollars are going to be required to resuscitate the economy.

There are numerous lessons but the one that sticks out for me is that governments should collaborate rather treat with suspicion the productive sectors of the economy, to ensure long term stability of their nations but also, from purely selfish perspective, to ensure their continued stay in power.

The productive sectors, agriculture, manufacturing and services as opposed to the rent seekers and corrupt, are what create jobs, pay the taxes and drive innovation.

While governments main reason for existence, couched in populist justification, is to hang on to power this should not be at the expense of the private sector.

"Once a government treats the private sector with suspicion and even actively undermines it, you know the end is near...

Wherever you look around the world, a country’s viability is determined by the robustness of its private sector and this can only come through the active collaboration between the private and public sectors.

So while one can sympathise with Mugabe for inheriting a poisoned chalice in 1980, his putting his political survival ahead of the welfare of the private sector is what has brought him to his current sorry situation.


The catch of course is that, if as a leader you prop up the private sector, it becomes a counterweight to your government and disagreements can end up being resolved politically to your detriment.

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