HARARE – With most Zimbabweans stressing about the country’s dying economy and rising poverty levels, as well as the heightened company closures and job redundancies, more and more observers are predicting the imminent explosion of social unrest and debilitating mass actions.
The latest to envisage more doom and gloom for the country is United Kingdom research company, NKC African Economics (NKC) — a unit of the world famous Oxford Economics think tank.
NKC’s dire prognosis of Zimbabwe’s immediate future comes as local analysts have said the country has hit the depths of humanitarian and economic despair that were last experienced in 2008, when Harare’s seemingly unending political crisis precipitated an economic meltdown of monumental proportions which culminated in the death of the Zimbabwe dollar.
NKC said in its latest report on Zimbabwe that a wave of mass demonstrations and social unrest, spawned by the country’s stuttering economy and high levels of poverty and unemployment — due to decades of misrule by President Robert Mugabe and his ruling Zanu PF — were likely to rock the country soon.
Commenting on the recent Supreme Court ruling which confirmed that employers, just like employees, could terminate the contracts of workers on three months’ notice, NKC said this would further create the conditions for mass demonstrations.
“It is barely conceivable that the Zanu PF government anticipated the consequences of the Supreme Court ruling for close to a month (or perhaps they were too distracted by the opening of Grace Mugabe’s new ice cream factory and the free samples they received).
“Within days of the ruling, dismissed workers were already flooding the streets, yet it took another two weeks and more for any official government reaction — even though the actions had started stirring yet more anger against the regime of President Robert Mugabe,” part of the scathing report reads.
It said further that even if the new legislation that was being put in place prevented further job losses, it was “a little too late” and angry masses were likely to confront Zanu PF and its government, which stood accused of causing the economic rot.
“Already, unions’ protests have been denied permission and prevented by force, adding new stresses to the political environment,” it said.
The reference to Grace’s new ice cream factory is in relation to the launch last week by the controversial First Lady of new dairy products, including ice cream, at a time when most of the country’s companies are reeling under the weight of the economic crisis — a move that courted the ire of the opposition who accused her of being insensitive to the plight of the poor.
MDC spokesperson, Obert Gutu, said Grace’s “extravagant display of wealth in a sea of poverty” was a clear sign that the Zanu PF regime did not give a “hoot” that people were suffering terribly.
NKC weighed in saying with the government seemingly burying its head in the proverbial sand, it was “only a matter of time before something gives in”.
“The Zanu PF regime’s apparent ‘let them eat ice-cream’ attitude, including its belated and empty response to what was an entirely predictable crisis of new job losses merely increases the prospect of heightened political instability in a country with a moribund economy, ruling regime in crisis, ruling party in disarray, unemployment rampant and people increasingly desperate,” it said.
It added that the economy was currently in freefall — and that the clueless government was in “sixes and sevens” about how to stop the malaise.
Analysts have also noted that poverty in the country has increased from 63 percent in 2003 to 76 percent in 2014, with most of Zimbabwe’s population living on less than $2 a day.
Only two days ago. Mugabe’s ally and respected Zanu PF elder, Cephas Msipa, told the Daily News that the country’s deepening political and economic crises — manifested by the escalating and brutal infighting within Zanu PF and the worsening waves of job redundancies in the country — would precipitate chaos.
Analysts have said contrary to the government’s heavy propaganda, the Zimbabwe economy is “definitely dying”, as manifested by worsening liquidity challenges, company closures and job losses.
Speaking in interviews with the Daily News recently, the analysts — who laid the blame squarely on Mugabe and his warring Zanu PF for the country’s myriad problems — also lamented the fact that the nonagenarian appeared “completely clueless” about finding solutions to the problems.
“We do not expect the economy to recover in the near term. The recently announced mid-term fiscal policy review statement confirmed our fears that the economy has stalled. We believe that even this forecast (of 1,5 percent growth) is ambitious and expect growth to be negative this year (at -1percent),” Invictus Capital — a securities advisory firm — said, for example, in a recent report.
Afghanistan-based analyst Maxwell Saungweme said unless “something dramatic” happened very soon, Zimbabwe was in fact headed for a political and socio-economic crisis that was worse than that experienced in 2008 when the country recorded one of the worst inflation levels ever reported anywhere in the world, where shop prices were literally changing by the minute.
“In 2008 we had our own currency to play with, though it was valueless, but this time around we have the US dollar which is hard to get for both the cash-strapped government and the people. Unemployment is also currently much, much higher than in 2008 and getting worse.
“Add to all this is the fact that the government is more clueless this time than before, in terms of providing economic reprieve for the people. And donors have also cut back on support to civil society and non-governmental organisations that used to provide life-saving interventions,” said Saungweme.
Renowned economist John Robertson said the situation that currently obtained in the country was already “statistically worse” than that which prevailed in 2008.
“I think we’re back to 2008, and in some cases it is actually worse than 2008. On the employment front, the number of people who are unemployed now is worse than we had in 2008.
“Statistics show that we actually have the same employment figures as we had in 1968, almost 50 years ago. While two million jobs were supposed to be created, we only have about 700 000 people employed, of which half of them are employed by the government,” Robertson said.
A snap informal survey on the streets of Harare found that the majority of the people on the street consider the current economic situation in Zimbabwe as “very bad” and it is not surprising as the economy continues to plummet.
The country’s economy has been plunging since 2013 with more than 4,000 companies closing down and thousands of workers losing their jobs.
In the last three weeks alone, more than 20,000 workers have been thrown on the streets following a Supreme Court ruling allowing employers to fire workers on three months’ notice.
More people are getting poorer with the middle class no longer in existence and the situation is getting dire. Analysts say the situation, if not properly managed, could lead to a disaster and instability.
Former treasury chief economist, Masimba Manyanya, says Zanu PF government has clearly failed to manage its macro-economics, adding everything in Zimbabwe is pointing towards a disaster of proportions.
With dissatisfaction mounting, he says, social groups, political parties, peasants and opposition political parties could join hands in frustration and put things into their own hands as they feel neglected by a government they think is increasingly selfish.
Another economist, Kipson Gundani, says all economic indicators are pointing the negative way, adding this is not good for the country.
According to Gundani, Zimbabwe’s economy suffers from a declining business confidence, especially with foreign investors shunning the southern African nation
Zimbabwe’s empowerment program compels foreign-owned firms to transfer majority stakes to local people.
He adds Zimbabwe desperately needs an injection of foreign direct investment to create new jobs and all. International business has constantly said lack of security of their investment worries them resulting in them holding on tight to their purses.
Main opposition leader, Morgan Tsvangirai of the Movement for Democratic Change, says the country’s economy can only be revived when Harare starts running credible elections whose results won’t be disputed and are acceptable to the outside world.
Political analyst, Fortune Gwaze, agrees with Tsvangirai that it’s difficult for an economy to thrive in a political crisis.
Economists say while countries in Europe that faced economic crisis since the world wars and to date like Greece for example, had been pulled out by neighbors and the international community, Zimbabwe is unlikely to enjoy such benefits as its leadership has been pouring scorn on the West in their dispute over the so-called targeted sanctions and related issues.
Zimbabwe’s has strained relations with larger donor countries like the United States and Britain and is also failing to service its debt with international financial institutions such as the World Bank and the International Monetary Fund.
Abundance of natural resources
This means that it cannot access any funding from them to revive its economy. But they say Zimbabwe has all the resources that it requires to turn around the economy, adding all that is required are policies that attract and protect investment.
Economist Nyasha Muchichwa of the Labour and Economic Development Research Institute of Zimbabwe says the country’s leadership has enough at their disposal to turn around the fortunes of the country.
In its book, Pro-Poor and Inclusive Development in Zimbabwe, Beyond the Enclave, the Zimbabwe Congress of Trade Unions says the government must borrow strategies that were applied in Asian countries to encourage investment in the export sector and pave the way for new industries, among many others.
The Asian tigers also ensured they had strong, capable, credible and well-committed government and strong political leadership and the results have been open for all to see as their citizens enjoy a much better life in thriving economies.- Daily News plus Voa