By Bernard Bwoni
The economic situation in Zimbabwe is
presented as dismal and bleak judging from some news headlines and recent IMF
Report on the country’s economy. A recent IMF Report screamed ‘Zimbabwe economy
is in a tailspin and at a crossroads’. The report is clear that ‘the main
objective of the new SMP is to strengthen the country’s external position, as a
prerequisite for arrears clearance, resumption of debt service and restored
access to external financing’. Zimbabwe met all the targets and structural
benchmarks set out by the recently expired IMF Structural Monitoring Programme
which expired in June 2014 leading onto the third review which will run until
December 2015. The workings of the IMF always leave a lot to be desired. This
is a footnote on the IMF website “1
An SMP is an informal agreement between country authorities and Fund staff to
monitor the implementation of the authorities’ economic programme. SMPs do not
entail financial assistance or endorsement by the IMF Executive Board”. Yet
in the report it states “Key risks to the
new programme stem from global commodity price shocks, domestic policy
slippages, gaps in policy implementation capacity and lagging progress in
resolving external arrears. While Zimbabwe faces these risks with artificially
no buffers, the successor SMP aims to rebuild these buffers and strengthen the
country’s resilience to shocks”. So the IMF will not restore financial
assistance or debt relief but instead will ‘rebuild the buffers’ they destroyed
in the first place and strengthen Zimbabwe’s resilience to shocks’? Since
Zimbabwe has met all the conditions as set in the previous SMP so why not offer
debt relief and a debt clearance strategy? This makes you wonder if the
Zimbabwe economy is as bleak as some are making it sound or vultures are
circling round the prey in the hope of swooping once the weakest points are
identified.
In as much as the situation with economy paints a discouraging picture
Zimbabwe is on the doorsteps of a phenomenal economic recovery. The silently
impending economic revival is due to country’s policy indigenisation, the land
reform and economic empowerment.
Zimbabwe has struggled economically due to sanctions imposed and the
fact that the country is still standing is testimony to the resilience and
collective strength of the Zimbabwe people. The country is moving towards a new
economic reconstruction backed by a resurgent agricultural sector, mining, the
enhanced contribution of the Small and Medium Enterprises (SMEs) and the steady
rise in foreign direct investment. The Chinese and Russians have been upfront
and forthcoming with their investment into Zimbabwe. The EU and the UK have
continued with the carrot and stick approach to investment and the removal of
sanctions against Zimbabwe, appearing to be rewarding the people of Zimbabwe by
removing the economic sanctions against the country painstakingly slowly whilst
keeping sanctions against the Head of State President Mugabe. The Chinese
concluded billion dollar projects in Zimbabwe to date and on his recent trade
mission to China President Mugabe concluded several infrastructure deals with
the Chinese. The Russians recently send their Foreign Minister Mr Sergei Lavrov
to Zimbabwe and signed a $3 billion platinum mining deal. The EU have been all
talk and placing conditionality after conditionality and the UK on the other
hand send a three men trade mission to ‘scoop for business opportunities in
Zimbabwe’.
Zimbabwe is currently facing significant challenges economically and to
get out of this mire and mud requires the collective spirit of the people of
the country. It requires a positive mindset, positive attitude and that
patriotic desire to free the country from this economic burden we find
ourselves in.
bernardbwoni.blogspot.com
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