ZIMBABWE’S ECONOMIC OUTLOOK
Presentation arranged by K P M G Peat Marwick : Bulawayo
INTRODUCTION
I have entitled my talk today “Economic Liberalisation: Political Protectionism”. My thesis is that the success of structural adjustment, trade liberalisation and the economy generally will, in the long term, stand or fall on the degree of genuine democracy brought to Zimbabwe. It is trite that economies have only been successful where they have operated in an environment of genuine democracy. As we consider Zimbabwe’s economic outlook I believe that it is imperative that we consider whether Government is committed to political liberalisation as well as economic liberalisation. If Government is not committed to this then I believe that structural adjustment and trade liberalisation will not work in the long term.
How do we assess Government’s intentions regarding political liberalisation? Looking back on the last l3 months or so there is a bewildering array of new legislation and policies introduced by Government. The last year has seen the publication of Government’s plans for trade liberalisation and structural adjustment and a general loosening of controls of the economy, the lifting of the State of Emergency, the September l990 decision of the ZANU PF Central Committee that it would not legislate a one-party state but instead would “organise and mobilise the people” to support the idea, the University of Zimbabwe Amendment Act, the National Council for Higher Education Act, the Constitutional Amendments and the Ministry of Political Affairs Vote. I use the word bewildering because some of the policies are progressive and yet some are retrogressive.
It appears as if Government is loosening up. Certainly as far as the economy is concerned the loosening of controls on the economy and the abandoning of socialism mark a “U” turn. Likewise the lifting of the State of Emergency and the decision not to legislate a one party state at first glance appears as if Government is interested in political liberalisation and democracy. The question has to be asked though in view of the retrogressive steps: ” what is Government’s real agenda?”.
2. Why all the changes?
Another question which needs to be asked is why has there been such a barrage of changes to policy and legislation in such a short space of time? There are the obvious answers: that the economy was stagnating, that South Africa is just about to come on to the open market and that the winds of political change sweeping through Eastern Europe and Africa have had an effect. Whilst I believe that these factors have contributed to the changes I believe that one should not ignore the fact that the result of the l990 General Election has had a major impact on Government. It is pertinent to note that all of the changes I mentioned earlier have happened since the March l990 election.
3. Elections
For all Government’s bluster after the l990 elections, that it was a landslide victory etc, the fact is that in their terms they took a hammering. Minister Zvobgo, shortly before the election, boasted to the BBC that ZANU PF would win every single seat, many opposition candidates would lose their deposits and that the people of Zimbabwe would overwhelmingly show that ZANU PF was the only political force. Minister Zvobgo was made to eat his words. The facts of the elections are that there were some 4,6 million people registered to vote, less than half the people eligible to vote went to the polls, Government was forced to add one day to the voting and throw the voting open to anyone who prove identity and place of residence. Furthermore of the votes cast there were l38 865 spoilt ballot papers and 396 l08 for opposition parties. When you add these spoilt ballot papers to the votes for opposition parties and the 2 million or so people who did not vote at all it is clear that it was a pyrrhic victory. Of great concern to ZANU PF must be the fact that the opposition got a tremendous amount of support in urban areas and that young people generally voted against Government.
The point I wish to make is that ZANU PF knew after the l990 elections that its political fortunes were sliding and that it could well be in for a lot of trouble in the next general election. I believe that it is important to consider all the changes to legislation and Government policies in that light. I believe that what Government has in effect done is decided on twin policies namely, firstly, the abandonment of socialism in a bid to boost the economy, create jobs and thus satisfy the aspirations of the young unemployed and, secondly, to isolate political opposition (in the wider sense of the phrase) without losing too many friends in the process amongst the donor community and western governments. If indeed this is Government’s policy I believe that the long term future of the economy is bleak as I do not believe that economic liberalisation and political protectionism are mutually compatible. But is there any truth in my theory that it is Government’s intention to embark upon a policy of political protectionism?
4. Opposition
What is the political opposition in Zimbabwe (using the wider sense of that phrase) as far as ZANU PF is concerned? I believe that it perceives three threats to its political powerbase, namely the student and intellectual community, the judiciary and opposition political parties. Whites and the business community generally I do not think are perceived as a threat by Government. I propose to look at these three groupings of political opposition and analyse what Government’s policy has been towards them since the March l990 elections.
l. Students/Academic Community
You will have read in the papers this past week about the boycott of classes by University of Zimbabwe students. The various clashes between Government and the student community have been well documented since the students first protested against corruption in September l989. Since that time the relationship between Government and University of Zimbabwe students has deteriorated steadily.
However towards the end of last year Government rushed through Parliament the University of Zimbabwe Amendment Act, l990. The responsible Minister, The Honourable David Karimanzira, Minister of State for Higher Education stated in Parliament on the 25th October l990, “we are not eroding at all the autonomy of the University.” The effect of the legislation however has been to give the Minister (and therefore the President and Government) personal control of 65% of the University Council for which the quorum is 50%. University representation in the 43 seat Council now totals l3 compared to the 26 direct Ministerial appointments. The effect of this legislation is that if for example the Vice Chancellor refused to say take the “Ministers advice” on suspending staff from duty or prohibiting students from attending lectures or debarring anyone from part of the campus, a new Council directly under control of the Minister could terminate the Vice Chancellor’s contract (or any other member for that matter) and replace him with a Presidential appointee, who would be wise (concerning his own interests) to do what the Government wants.
Closely following on the heels of the University of Zimbabwe Amendment Act, l990, was the National Council of Higher Education Act which establishes a Council with the large majority of Ministerial appointees charged with, amongst other things, regulating “common student admission procedures”, “maintaining appropriate standards in regard to teachers”, and “to revoke the governing charters of Universities”. The academic community certainly believe that through this Act the “State intends to deprive the University of Zimbabwe of all independent control over who it admits, what and how teachers examine, and the standards of attainment to be applied”. I point out that the measures contravene directly the World University Services l988 Lima Declaration on Academic Freedom and the autonomy of the institutions of higher education.
Despite their statements that they are not eroding the autonomy of the University Government’s intention is quite clear. The student and academic community’s outspokenness has been an embarrassment and a very grave threat to their political survival. Both Acts are simply designed to control the University and the student community in an effort to suppress freedom of thought. Of great concern is that the students’ original grievances, such as the concern about corruption, are by and large valid and demand attention.
2. The Judiciary
The Constitutional Amendment Act passed at the end of last year has attracted a lot of attention and you are all no doubt fully aware of its provisions. Sadly however I believe that both the business community and to a lesser extent the international community have concentrated on the amendment to section l6 of the constitution that is the changes regarding the compulsory acquisition of land.
The business and farming community have not shown any concern about the changes to section l5 of the Constitution, that is the provisions relating to whipping and hanging. In doing so I believe that many Zimbabweans have totally overlooked or ignored the deeper intention of the Act.
I would like to discuss four aspects of the Amendment Act, namely the amendment to section l5 allowing for the whipping of juveniles, the amendment to section l5 declaring that hanging is a constitutional form of punishment, the amendment to section l6 denying the courts the right to review the price offered following compulsory acquisition of land and the provision which reaffirms the independence of the judiciary. Many of us in the human rights and legal fraternity battled at first to understand why Government was introducing the changes. The fundamental change to section l6, that is giving Government greater powers to acquire land, was not puzzling. It has always been on Government’s agenda and there are obvious political and moral reasons for wanting to redistribute land. The rest of the changes however are, at first glance, deeply puzzling and I will show you why:
(a) The Whipping Provision
The amendment to section l5 declaring that whipping of juveniles is not inhuman punishment effectively reversed a Supreme Court decision The State v A Juvenile S64 which was handed down in l989. This decision followed an l987 Supreme Court decision (Ncube, Tshuma and Ndlovu v The State) which had declared that whipping of adults was both inhuman and degrading. Immediately after the l989 decision the Government repealed the provisions contained in the Criminal Procedure and Evidence Act which allowed for whipping as a punishment. When the President opened the Judicial Colloquium held by the Commonwealth Secretariat in Harare on the l9th April l989, he stated “I am proud to report … that our judiciary has not failed” (in the difficult task of interpreting constitutional guarantees of fundamental rights and freedoms). He referred to the Ncube, Tshuma and Ndlovu case and quoted that the punishment of whipping was “in its very nature both inhuman and degrading”. He went on to say that the decision rectified and changed a situation that had obtained in our system of justice for many years. It was therefore very difficult at first to understand why Government had suddenly reversed its thinking on the subject. Government offered the lame excuse that there were no alternatives to whipping and yet it knew that the Law Development Commission had done considerable work on the subject and was actively looking at various alternatives.
(b) Hanging Provision
The amendment to section l5 declaring that hanging is a constitutional form of punishment effectively forestalled a decision by the Supreme Court being made on a test case which was to be heard in November l990 regarding the constitutionality of hanging. It goes without saying that the Supreme Court had not made up its mind on the matter as the case was still to be argued.
What was puzzling about the amendment was that the President himself is publicly on record as having stated that he is against the death penalty. Furthermore with the prospect of peaceful change in South Africa, the end of South Africa’s policy of destabilisation and the sealing the Unity Accord there were few political arguments for the retention of hanging. Even if the Supreme Court had ruled that hanging was a cruel and inhuman punishment that decision would not have signalled the end of the death penalty as Government could have resorted to the electrical chair or other means to effect the death sentence. It is not even as if the retention of the death penalty was high on the political agenda. It simply is not an issue amongst the Zimbabwean public in the same way it is in the United States of America and Government could have allowed the provision to go through either way without suffering politically for it. On the face of it then the decision to forestall the Supreme Court hearing of the case was baffling.
(c) Review of Compulsory Acquisition of Land
One of the amendments to the section l6 as you know removed the right of the courts to review whether any payment made following the compulsory acquisition of land was fair. The former Chief Justice had this to say about the amendment in December l990: “(It) flies in the face of all accepted norms of modern society and law. It effectively takes Zimbabwe back to the last century”.
Why did Government change this aspect of the Constitution? The President is on record of saying that he is not prepared to have the Courts delay the acquisition of land. Mr Mangwende when questioned on the subject at a recent farmers’ meeting replied by saying he could not understand why farmers wanted the provision as they had never used it in the past. His statement however begs the question: If it has never been used in the past then why has Government got any cause to worry about it being used in the future?
Likewise given the fact that Government has taken years and years to settle people on land already acquired by it, one wonders why Government is suddenly so anxious not to have the matter delayed for a few months to enable the courts to review the fairness of any decision. Even more puzzling is the fact that our courts have been entirely reasonable as far as Government is concerned in the past regarding the determination of fair compensation and there is nothing to suggest that the courts would be anything but reasonable and fair in their determinations in future. Indeed the retention of review would not in any way set back or jeopardise Government’s plans to compulsorily acquire land. The political issue that Government had to address was the principle of redistributing land equitably not the mechanics of how it could be done equitably. I would suggest that people in rural areas would not object at all if the courts were to have a say in reviewing Government’s decisions. This decision by Government was accordingly puzzling.
(d) Reaffirmation of Court’s Independence
The final aspect of the Constitution Amendment Bill that needs a look at is the silly clause which reaffirms the Court’s independence. This clause I believe should be viewed in the same light as Minister Karimanzira’s statement that the University of Zimbabwe Act “will not erode at all the autonomy of the University”. As I will point out just now the very effect of the abovementioned three changes is to reduce the court’s independence and power and this clause must simply be seen as a rather crude attempt to disguise the actual purpose of the constitutional amendments.
There are further disturbing policies which directly affect the courts. The conditions of service of our High Court and Supreme Court Judges are, relatively speaking, and require urgent attention. As a result a Judge (Mr Justice Sansole) resigned last year. Furthermore as a result I believe that Government has found it difficult to attract people of suitable calibre to the bench. The courts themselves are obviously not a priority as far as Government is concerned. It is interesting to note that whilst Government is prepared to spend $25 million in sprucing up Victoria Falls for one week and it cannot spend a few thousand dollars to give the High Court of Bulawayo a badly needed coat of paint. Next time you pass the High Court have a look, you will see that the shutters are falling off their hinges and that it is badly in need of a coat of paint and general renovation. I am also aware that our Supreme Court Judges have not until now had a single word processor amongst them. Indeed they have had to approach the Germans and Americans to supply this necessary equipment which, I am pleased to report is now being supplied. The point is however that Government itself does not see our Judges and the courts themselves as a high priority.
I would therefore suggest that one needs to see through the Constitution Amendment Act and to see the amendments to section l5 and section l6 (insofar as the latter refers to the court’s power to review) are simply designed to reduce the power of the Supreme Court, to diminish the respect in which it is held and to diminish the respect for the Bill of Rights. The budgetary policies have had a general effect of undermining the courts. The only way to understand the puzzle created by amendments is to realise that Government purpose is to undermine a source of political opposition and thus strengthen its own position. The Supreme Court of Zimbabwe has a proud history of the last few years of being fiercely independent. It has been praised internationally because it has not kowtowed to Government. It is no secret that Government has resented many of the decisions handed down by the Supreme Court as those decisions have effectively restrained Government from acting in the way it wanted to.
3. OPPOSITION PARTIES
The third source of political opposition is the obvious one, opposition political parties. As I have already indicated in September last year the l60 member ZANU PF Central Committee decided that the Government would not legislate a one party state but instead would “organise and mobilise the people” to support the idea. Many people have interpreted this decision as a decision to take the one party state ideal off Government’s agenda but I believe that that is wrong.
In last year’s budget the Ministry of Political Affairs was allocated $50 million. To get this vote in perspective one needs to compare it to the budget allocated to the whole of the National Parks which was $27 million. Whilst $20 million of the $50 million is allocated to National Service I certainly haven’t heard anything further regarding National Service and it will be interesting to see in July how that money has been spent. It will also be interesting to see whether the Ministry of Political Affairs gets an increase in the coming budget. In the July budget last year Government stated that it was committed to reducing the number of civil servants. However it is a well known fact that all ZANU PF functionaries are now in effect civil servants and paid by the Salary Service Bureau. I also believe all the new vehicles purchased by ZANU PF were also paid for by the Ministry of Political Affairs although on this I stand to be corrected. The Ministry of Political Affairs is now located in the ZANU PF Headquarters and when Senior Minister Mutasa defended his vote in Parliament he confirmed that the money was only for ZANU PF. This policy has not changed since the September decision of the Central Committee and continues, in my opinion, to be a clear violation of section 23 of the Constitution (which outlaws discrimination) and section 2l of the Constitution (which outlaws the hindering of citizens’ rights to free political association).
It is also common knowledge that opposition parties (such as they are) are still harassed and find it very difficult to operate in Zimbabwe. Government’s control of the media is just as tight as it has ever been.
The point I wish to make is that despite the September decision I believe that Government’s agenda has not changed. It simply recognised that it was not opportune to introduce a one party state and that it would have to be satisfied with doing everything in its power to maintain a de facto one party state.
4. WHY ALL THE CONTROLS?
From the above I believe that it is clear that Government has actively embarked on a policy of political protectionism since the March l990 elections. It has tried to disguise its policy. As indicated above it has tried to state that it is not eroding the autonomy of the University. It has cleverly used an emotive issue (the redistribution of land) to undermine the Supreme Court and despite its public disavowal of its intention to legislate a one party state it has done everything in its power to keep that objective fully on track. But why all these controls? Why is Government almost paranoiac about destroying any potential opposition to it? There is the obvious answer that no Government wants to be voted out of power. That of course is true but I believe that there is another more compelling reason and that is that Government cannot actually afford to lose power now. The statement of Lord Acton that power corrupts and absolute power corrupts absolutely is already a reality in Zimbabwe. From the evidence before me as a lawyer I believe I can say with confidence that corruption within Government is rife and that the Willowvale Scandal pales into insignificance compared to the level of corruption now. It is important to remember that the original confrontation with students started when they appealed to the President to deal with corruption. Government cannot afford to have students who can motivate and articulate concerns. Government cannot afford to have a powerful court that will expose and punish corruption at every turn. But most important individuals in Government cannot afford the possibility of losing power and the resultant commissions of enquiry which will expose their corruption. The reason I have introduced the topic of corruption at this stage in my thesis is simply to state that as long as corruption abounds within Government I do not believe that there is any prospect of Government changing its policy of political protectionism.
5. ECONOMIC LIBRALISATION AND POLITICAL PROTECTIONISM ARE NOT MUTUALLY COMPATIBLE
It goes without saying that trade liberalisation and structural adjustment cannot work in a vacuum. The experience of the world is that genuine democracies have the strongest economies. Economic liberalisation will not work in Zimbabwe unless Government abandons its policy of political protectionism. I need to stress that I am not saying that economic liberalisation will not work in Zimbabwe. I am simply saying that unless Government is encouraged to bring about genuine democracy in Zimbabwe and liberalise the political environment the long-term economic outlook for Zimbabwe will be bleak. If we just consider some aspects of Zimbabwean society that I have mentioned above you will see what I mean.
(a) Students/University
Any expanding economy relies on strong universities which in turn are producing innovative thinkers. Government’s attempt to control universities will inevitably lead to a further brain drain, not just of university academics but of bright newly qualified students who will be attracted elsewhere. Assuming that South Africa comes on line in a few years there will be the further threat of a tremendous brain drain given the unskilled, uneducated black populations and needs of that country. Government and the business community needs to be doing everything in its power to retain our academics and graduates at this time as there will be a myriad of attractions in South Africa shortly.
(b) Court System
The Supreme Court has been one of the main attractions of Zimbabwe as far as the western political community is concerned. Zimbabwe is respected at present as having a strong independent judiciary and this in turn has created the image that Zimbabwe is a democratic state and therefore a good place to do business in. Any undermining of the judiciary will inevitably affect not only the internal economy but also the confidence of future investors.
(c) Free flow of Information
Government’s desire to retain control and not to allow any other political party or think group to come to the fore inevitably stems the free flow of information in the country. Government’s continued control of the media will continue to have a negative impact on our economy. It goes without saying that the free flow of information is vital to a healthy economy. Related to this is the spectre of corruption continuing. Without the free flow of information even if controls in the economy are relaxed corruption will continue to flourish. Corruption can only be stifled if there is a free flow of information, through ongoing investigative reporting which exposes corruption. I believe that corruption is an epidemic which if allowed to continue will undermine the entire economy and it is therefore imperative, if trade liberalisation is to work, that it be brought under control.
6. WHAT CAN THE BUSINESS COMMUNITY DO?
I believe that one of the dangers facing Zimbabwe is that the business and commercial sector generally has not fully grasped that economic liberalisation and political protectionism cannot work together. No doubt there are many who have grasped the reality of the situation and take a cynical short term view of things. Primarily because of all the controls in the economy today business has been forced to collaborate in corrupt and extortionate acts. In order to survive most businesses in Zimbabwe have had to collaborate in corrupt practices. Indeed many businesses have not just survived while collaborating in the practices but have actually prospered and because of this may think that economic liberalisation can prosper in an environment of political protectionism.
I believe that this is a very short term view. The history of Africa and other developing countries shows that undemocratic Governments are inevitably followed by increased corruption, increased inflation and eventual economic decline. The only people who flourish are the Government Ministers, the externally based shareholders of multi-nationals and the privileged few Chief Executives of locally based companies who have managed to illegally obtain foreign currency. Because of this I believe that if we are genuinely interested in a future in Zimbabwe and a sound economic outlook we need to take a serious long term view and consider what we as business people can do to ensure that economic liberalisation is accompanied by political liberalisation. With this in mind I would conclude with the following suggestions:
(a) Without businesses’ collaboration in corrupt practices corruption cannot flourish. I believe that the time has come for businesses in Zimbabwe to decide jointly that they are not going to tolerate any form of corruption or extortion. I recognise that it will be difficult for business to implement any such policies but I believe that it is absolutely vital to the future of Zimbabwe’s economy. I need not go into detail as you no doubt are all aware of the problems you face in this regard in your own businesses.
(b) The business community needs to realise that its silence on human rights issues and collaboration with one political party will ultimately undermine investment confidence even though these policies may be prudent in the short term. Traditionally the business and commercial sector in this country has kept quiet as far as all sorts of human rights abuses are concerned. This problem has been compounded by the fact that business has collaborated with ZANU PF on a number of business ventures. Whilst I hold no brief for any other political parties I believe that the business community undermines true democracy by supporting a sole political party. I believe that joint business ventures with ZANU PF and acts such as donating to the ZANU PF Building Fund not only undermines the concept of multi-party democracy but is also flawed business practice in the long-term. The question needs to be asked: “What will happen to my business if ZANU PF loses power in five years time given my collaboration with that party?”
(c) The business community needs to make a bold and public stand that if trade liberalisation and structural adjustment are not accompanied by political reform the economy is doomed. Government needs to be told in no uncertain terms that its actions in undermining the Universities, the courts and opposition political parties will not be tolerated by business. Business furthermore needs to publicly support university academics, the judiciary, the legal profession and credible human rights organisations all of whom are taking a strong stand on the issue.
I believe that unless these points are seriously considered by the business community a bright economic future in Zimbabwe will at the least be severely retarded if not reversed completely.
DAVID COLTART
6TH MAY l99l