 |
 |
 |
 |
 |
 | ||||
Ham-fisted Mugabe has no place... |
Ham-fisted Mugabe has no place left to hide
The parallels between Mugabe and Kenneth Kaunda in his last years are compelling, writes TONY HAWKINS
COMPELLING though the parallels with the final years of Kenneth Kaunda's 27-year rule in neighbouring Zambia might be, it is still too early to say that the events of the last three months mark the beginning of the end for Zimbabwe's President Robert Mugabe. But the similarities are striking -- the budget in crisis, the exchange rate on the ropes, business confidence at an 18-year low, mounting industrial unrest, while food price riots on the streets of the capital have forced the government to deploy the army to control its own people. After the events of the last three months - the collapse of both the currency and business confidence, two separate bouts of urban unrest, the government's panicky resort to price controls to curb food price inflation -- it is hardly surprising that cabinet ministers and party backbenchers should be whispering that "the old man is out of touch" and has become a "liability to the party". Yet those with plenty of ammunition to criticise the government - business leaders - seem reluctant to accept that a change in leadership, if not in government, is needed to redeem the situation.
The commandeering of corporate foreign currency accounts last November, curbs on forward cover transactions and, this week, the partial re-imposition of food price controls, suggest that Mugabe is not the man to champion economic reform.
Yet business leaders attending a government-convened National Consultative Forum meeting recently maintained that the country's economic problems would be solved provided business, government and labour all pulled together. Nor is business alone in what some economists regard as wishful thinking. The International Monetary Fund, as it left Harare after its last visit in November, said the government had adopted a "strong adjustment" plan. The record, however, does not bear this out. The government has shelved all but one of five tax increases and this week rescinded a market-driven increase in the maize price. When increased debt-service expenses, the fuel subsidy and the near-certainty of a public sector pay award in mid-year are factored into the budget equation, the deficit is projected at about 10% of gross domestic product compared with an 8% target. Despite this, government officials this week claimed to be optimistic that an IMF loan was in the offing. Such a decision, however, would have to ignore the substantial fuel subsidy, the return of partial price controls, growing corruption, the threat to seize farmland without paying adequate compensation and the government's failure to implement previously agreed revenue measures to curb the budget deficit. Lenders would have some difficulty in justifying resumed aid after the leak that in a week when the army was called to quell food riots, the government spent Z$66-million on 50 new Mercedes vehicles for its ministers. Nor are IMF-World Bank rescue packages going to turn the economy around. Figures of possible assistance mooted by government officials total less than US$300-million - no more than enough to cover six week's imports of goods and services and dividend and interest payments. True, imports will fall steeply this year, reflecting the collapse of investment confidence and the 40% devaluation of the currency last year which has meant huge rises in consumer durables. But while the $300-million might help to stabilise the exchange rate -- now around Z$19 to the US dollar - it will not be anywhere near enough to fuel economic recovery. To make matters worse, investment is on hold, primarily because of the government's proposed land takeover which Mugabe insists will go ahead in spite of reported warnings that it will seriously damage the economy.
Critics point out, however, that because he does not have the money to buy the land, let alone resettle thousands of peasant families, the programme to acquire 1 470 farms is not going to go ahead at anything like the pace the government has promised. At most, the government might manage 50 to 100 farms a year, but even that would require substantial foreign assistance. Which leaves the president with yet another credibility problem. Few doubt that the government will be forced into a partial U-turn on land rather than risk the international opprobrium of expropriation without fair compensation. Yet, having bolstered his declining popularity by promising land to the people - a promise he recently repeated - Mugabe is in no position to turn his back on the one policy that is really popular. Quite when the next crisis will come is impossible to say. Were the government to raise fuel prices by the 40% or so needed to eliminate the subsidy, it would risk provoking a fresh outbreak of riots. Yet the subsidy is costing as much as the one-off gratuity to war veterans that set off the budget crisis last August. Whichever way he turns, Mugabe is likely to find - like Kaunda eight years ago - that the way is blocked. Were there a serious political opposition or even an obvious successor waiting in the wings, his political future would be in very real jeopardy. But there is not. Instead, the probability is a nasty bout of political infighting, driven by ethnic and tribal considerations, leaving the country with the same discredited ministerial team. - Financial Times.
|