September 24, 2008.

PROSPECTS FOR A NEW BEGINNING

The power-sharing accord signed on September 15, 2008 marks a turning point in the struggle for democracy and efforts aimed at promoting reconciliation, stability and fostering conditions conducive for the reconstruction of the catastrophic socio-economic collapse in Zimbabwe. This was an epochal moment  - the end of 28 years of uninterrupted, increasingly autocratic power for Mugabe, the triumph of an excruciating effort of mediation by Thabo Mbeki, the outgoing South African president, and the culmination of years of perilous campaigning by Morgan Tsvangirai, who endured beatings and detentions to prevail.

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"My belief in Zimbabwe and its peoples runs deeper than the scars I bear from the struggle," Tsvangirai declared.

Coincidentally it came exactly nine years after the founding of the Movement for Democratic Change. Thus, this is an historic moment in that under the agreement, the MDC President, Morgan Tsvangirai, 56, becomes Executive Prime Minister, chairing a Council of Ministers, which will assist him to run the day to day business of government, while formulating and implementing policies. The PM will be charged with supervising the work of the cabinet. He will head government business in Parliament and also sit on the National Security Council, the successor to the current controversial Joint Operations Command (JOC). He will advise Mugabe on all future appointments including Judges, Ambassadors and the like.

There should be no illusion whatsoever that this constitutes a magic wand to cure the Zimbabwean disease. The agreement, which is still in dire need of being fleshed up, only provides a credible basis for eventual resolution of the crisis of governance in Zimbabwe. While the cynics especially the ones outside Africa should be ignored, the voices of those who have expressed cautious optimism should be reckoned with by the major players on the Zimbabwean political scene.

Prime Minister Morgan Tsvangirai gave an eloquent and moving address, full of hope, promising reconciliation and urging restraint and tolerance as the price to pay for a better tomorrow for all Zimbabweans. Responding to the sealing of the deal, Tsvangirai said most instructively: "It is time to turn our swords into plough-shares. If you were my enemy yesterday, today we are bound by the same patriotic duty and destiny." The tinge of irony in this statement should not be lost on the wary observer. Tsvangirai, the former trade unionist who turned a formidable politician, was actually borrowing the exact words used by Mugabe in his inaugural speech as the first Prime Minister of the Republic of Zimbabwe on April 18, 1980.

However, Robert Mugabe looked backward. He was resentful, incoherent at times, and blamed everybody for Zimbabwe's problems. He made no mention of the deal he had just signed, or about the future. He even used the occasion to take a swipe at the MDC "which wants much more than it deserves"; as if political oppositions anywhere were not entitled to the rotation of power that forms the bedrock of democracy. He also singled out Botswana for having criticised the violent and fraudulent presidential election run-off of June 27. Referring to President Ian Khama's public statements on the situation in Zimbabwe, he said: "I will never attack an African leader in public." He then went on to chant: "Botswana, Botswana, Botswana! Ooooooh."

His body language as much as his words  - his sulking demeanour and slouching manner - suggested the same reluctance to settle as he showed almost 30 years ago when he was the political figurehead of the Zimbabwe African National Liberation Army fighting Ian Smith's Rhodesian Front regime. At that time, African leaders grouped in the Frontline States supporting Zimbabwe's Chimurenga - the liberation struggle - counselled him insistently to make peace by compromise with his adversaries. But he dreamed of an absolute military victory in the name of Maoist revolution, and accepted their advice only under extreme pressure, particularly from neighbouring Mozambique - the rear base for ZANLA.

"The problem we have had is a problem that has been created by the former colonial power. Why, why, why the hand of the British? Why, why, why the hand of the Americans here? Let us ask that," Mugabe rumbled. Indeed, this seemed to fuse into a man who still saw the world in much the same terms as he did when he took power in 1980. Capitalist America and Britain can no longer be blamed for Zimbabwe's collapsing economy.

This goes to emphasise that the practical implementation of this hard-fought compromise is potentially fraught with difficulty and will require the utmost patience and professional skills on both sides to make it work. Zimbabweans are desperate for an end to a crisis that has ravaged the economy and pushed millions of refugees into neighbouring countries.

A National Economic Council (NEC) to spearhead economic reforms would be established. The country needs to change direction and any external support will be linked to the Executive PM's ability to convince the private and public sectors and the multinational investors that a new dawn has arrived and there is no turning back.

Robert Mugabe, 84, remains President of Zimbabwe and will chair a Cabinet comprising 31 ministers. Of the 31 new ministries ZANU (PF) will retain 15, with eight deputy ministers, while 13 ministers and six deputies will be appointed from the ranks of the mainstream MDC. The Mutambara faction will be allocated three ministers and one deputy minister. This makes a total of 46 as opposed to about 64 in the last ZANU (PF) Cabinet (only 23 of the 64 will be appointed).

The restoration of powers to the Cabinet (Council of Ministers) - as opposed to ZANU (PF)'s Politburo - for the formulation and implementation of policy is a welcome development. The nation will be looking to them to ensure that they pursue a comprehensive, vigorous and urgent legislative reform agenda.

The power-sharing agreement acknowledges the haphazard manner of the land-reform programme and proposes a non-partisan land audit for the purpose of establishing accountability and eliminating multiple-farm ownerships. Critics of Robert Mugabe have accused him of giving the best land to ranking members of his government and party. They also charge that some of the beneficiaries have more than one farm while many Zimbabweans are still land hungry.

In terms of the agreement, Zimbabwe's former colonial power, Britain, has "to accept the primary responsibility to pay compensation" to white Zimbabweans who lost their farms during Mugabe's controversial land redistribution programme. Even then, there is a lot in the agreement to show that the reality on the ground is well captured. For instance, in trying to define the historic moment of the country, the agreement embodies the following in Article V:

• Clause 5.3 says, "Accepting the inevitability and desirability of a comprehensive land reform programme in Zimbabwe that redresses the issues of historical imbalances and injustices in order to address the issues of equity, productivity, and justice."
• Clause 5.5 says, "Accepting the irreversibility of the land acquisitions and redistribution."
• Clause 5.9 (a) says, "The Parties hereby agree to conduct a comprehensive, transparent and non-partisan land audit, during the tenure of the Seventh Parliament of Zimbabwe, for the purpose of establishing accountability and eliminating multiple farm ownerships."
• Clause 5.9 (b) says, "The Parties hereby agree to ensure that all Zimbabweans who are eligible to be allocated land and who apply for it shall be considered for allocation of land irrespective of race, gender, religion, ethnicity or political affiliation."

The haphazard distribution of land is as important a democratic question as the intimidation and torture of opponents during elections. For more than 20 years after independence less than 5% of the population owned more than 70% of the arable land.

Between 1983 and 1997, villagers from Mutasa, Chihwiti, Mhondoro and Nyamatsitu communal lands repeatedly invaded properties that the state had leased to white commercial farmers. In each instance, the government evicted these landless villagers by force. In June 1998, the Svosve people of the Marondera and Wedza districts undertook a series of illegal farm occupations. Earlier in October 1996, the land issue came to a head when a group of 200 land hungry peasants invaded an idle state farm adjacent to the Matobo Research Station in Matabeleland in defiance of the government. The unilateral action by otherwise law abiding citizens was an illustration of the growing impatience among thousands of landless Zimbabweans over the implementation of the nation-wide land redistribution programme to correct pre-independence imbalances.

By taking the law into their own hands and resettling themselves haphazardly, the peasants were making a political statement on how the government had failed to meet their hunger for land. Their anger was increasingly diverting from the colonial legacy to senior government and party officials whom they accused of benefiting from the farms acquired by the State for resettlement purposes. In early 1996, Matobo district was hit by a scandal in which some of the twenty-two farms meant for resettlement were leased to local political heavyweights.

The southern African nation's economy has been rocked by spiralling unemployment of 85% and an acute shortage of food and essential goods blamed partly on controversial land reforms undertaken by Mugabe's government. Economic capital, infrastructure, banking capital, human capital and the institutional framework are all in need of recovery and repair.

Not only is the agreement important for Zimbabwe, but has far-reaching political and economic implications for Southern Africa and the entire African continent. It is hoped that party-political interests will be swiftly put aside in exchange for a united desire for visible action to alleviate the shameful plight of ordinary Zimbabweans and to restore their dignity.

The political players should be applauded for agreeing to remove the control of the police from those who, in the past, have used it with impunity for party-political purposes rather than for the professional protection of the public without fear or favour. In any democracy, and for peace to be achieved, the rule of law is essential and non-negotiable.

With hindsight, the power-sharing document in Article XII, 12.1 (b) says, "The government shall undertake training programmes, workshops and meetings for the police and other enforcement agencies directed at the appreciation of the right of freedom of assembly and association and the proper interpretation, understanding and application of the provisions of security legislation."

The judiciary, the police, the public service, the media, the schools and health providers have been systematically undermined and corrupted by the Mugabe regime.

As regards the media, the power-sharing document in Article XIX, 19.1 (a) says, "The Parties hereby agree that the government shall ensure the immediate processing by the appropriate authorities of all applications for re-registration and registration in terms of both the Broadcasting Services Act as well as the Access to Information and Protection of Privacy Act." Thus, it is expected that visible steps will immediately be taken to restore the credibility and independence of the state broadcaster and print media so that they truly function in the public interest.

The parties to the agreement must immediately commence the processing of applications for commercial and community broadcasting licences, finalize the long-outstanding application for re-registration of The Daily News, and remove the punitive duty being charged on foreign publications which are meant to restrict their circulation within Zimbabwe.

A new constitution would be drawn through a process involving all stakeholders and a parliamentary select committee. A referendum would be held to determine if Zimbabweans were in agreement with the new draft. The process should be carried out in 18 months, paving way for new elections. As a precaution a review of the power-sharing deal will be conducted in 18 months, and every year thereafter.

Over the past decade, the country's economy has shrunk by at least 65%, the manufacturing sector is operating at below 30%, and the official inflation rate hit 11.2 million percent in June. The new government will be saddled with a four-billion-dollar (€2.8 billion) external debt and a domestic debt of Z$79.9 million. It will also inherit a free-falling currency that has been revalued twice over the last three years with 13 zeros removed to make it more manageable.

The IMF withdrawal nine years ago was seen as a cue to other multilateral financial institutions to freeze their credit lines to the southern African economy. And then the fund suspended Zimbabwe's voting rights in June 2003, barring it from participating in IMF decisions, as the Mugabe regime fell behind on paying its IMF debts and the economic situation deteriorated. While Zimbabwe has averted expulsion from the IMF, the global lender has maintained its suspension of financial and technical assistance. This has seen Zimbabwe accumulating arrears with the IMF amounting to more than US$135 million since February 2001.

Issues of production, food security, poverty and unemployment, as well as the challenges of high inflation, interest rates and the exchange rate compete for space at the top of a crowded agenda. Changes in the economy are not going to happen overnight. Some of the key drivers of the economy, such as agriculture and manufacturing, are in really bad shape.

The International Red Cross estimates more than 2 million people are hungry in Zimbabwe, and that the number is going to rise to 5 million, about half the population, by year's end.

International donor agencies such as the World Food Programme (WFP), World Vision, Canada International Development Agency (CIDA), Ford Foundation and International Monetary Fund (IMF) have expressed interest in assisting Zimbabwe stand on its feet once again. The African Development Bank and the World Bank said in a joint statement that the power-sharing agreement represented a potential opportunity for Zimbabwe. The World Bank also confirmed that they were ready to assist where possible to ensure that Zimbabwe's economy is back on its feet and become the breadbasket of Southern Africa. the African Development Bank was prepared to urgently put together a US$1 billion fund for Zimbabwe's recovery project.

The European Union's economic recovery package to Zimbabwe could reach €50 million (US$72.2 million) once the power-sharing deal is seen to be working as it is put into practice. It is envisaged that these funds would be for food security, agriculture, public health, governance and support to civil society.

The Bush administration has made clear its readiness to join others in helping revive the country's crippled economy if the political crisis is resolved. A senior official who spoke to reporters said the political agreement signed appears to have been openly and freely accepted by the opposition, without any coercion. But he was non-committal about the United States lifting sanctions or joining in an economic rescue plan without further study of the accord, and its full implementation.

Perhaps, Washington and the European Union are right to keep their sanctions in place until it becomes clearer whether this agreement can produce real change or is just another devious manoeuvre. Already there were signs of cracks in the power-sharing agreement as the parties tried to allocate cabinet portfolios on September 18 - barely three days before the ink had dried. It was reported that both the main-stream MDC and ZANU (PF) were insisting on having the Home Affairs, Information, Foreign Affairs, Finance and Justice.

On his part, the Prime Minister of the new unity government was prepared to let Mugabe control the Defence portfolio. This bickering could mean further delays before a new government is appointed to deal with urgent crises such as strikes by teachers and doctors that have paralysed the education and public health sectors. Thousands of teachers and doctors have quit their jobs in the country to look for menial jobs mostly in South Africa, Zimbabwe's prosperous southern neighbour while others have gone as far as Britain and Australia.

It is baffling to understand how ZANU (PF) can claim the Finance post when they have failed to balance government revenue and expenditure. While ZANU (PF)'s economic development plans were good on paper, they were never implemented - e. g. the Zimbabwe Programme for Economic and Social Transformation (1998) as a replacement for the Economic Structural Adjustment Programme (Esap). The government argued that Esap was not home-grown and therefore failed to address the country's problems. Vision 2020, Millennium Economic Recovery Programme (2000), National Economic Revival Programme (Nerp) in 2003, Towards Sustained Economic Growth - Macro-Economic Framework 2004-2006 (2004) all ended up in the archives.

The 2006 National Economic Development Priority Programme (Nedpp) was one of the most hyped economic blueprints. The architects said Zimbabwe had to forget the sad memories of a cocktail of other failed blueprints that preceded the Nedpp because the government had finally crafted a plan to reverse, within nine months, the severe effects of ten years of recession.

At the end of September 2007, the government again indefinitely postponed the launch of the Zimbabwe Economic Development Strategy (Zeds) - an ambitious economic blueprint seen extricating the comatose southern African economy out of an eight-year-old quagmire. Zimbabwe's economic downfall has been around policy implementation as opposed to policy formulation. Zimbabweans could not see that silver lining in the dark cloud that only the government could see!!

The same goes with Foreign Affairs where the ZANU (PF) regime has left Zimbabwe's image in tatters. Just as the power-sharing administration is expected to remodel the country's image, Zimbabwe's ambassador Enos Mafemba on September 17 launched a fierce attack against France at the UN Human Rights Council in Geneva, saying its actions in Rwanda and Corsica should stop it criticising any other state's rights record.

"We challenge the EU through France to address issues of human rights in Corsica, in the collectivities and overseas departments or regions," Mafemba said. "We also ask France what its role was in the genocide in Rwanda," he added.

The Zimbabwean ambassador's ire had been sparked by comments by French ambassador Jean-Baptiste Mattei - speaking on behalf of the European Union - which expressed concern at recent political violence in the southern African country. Where are Mafemba's diplomatic ethics? Zimbabwe needs to take a detour from its belligerent approach towards the West.

The interim administration must rise above politics of patronage and start making meaningful appointments to the Cabinet and diplomatic corps. On August 27, 2008, after opening Parliament, Mugabe acknowledged that his ministers had failed him when he said, "This Cabinet that I had was the worst in history. They look at themselves. They are unreliable..."

The new Cabinet must inspire both internal confidence among Zimbabweans and the international donor community and governments. One major criticisms levelled against Mugabe has been his appetite for rewarding his loyalists with top government and diplomatic positions in the face of their record of poor performance. Instead, most non-performers were being shuffled around ministries like a deck of cards in a porker game.

The resumption of crucial financial support to the troubled southern African country will depend largely on Mugabe's willingness to abandon his patronage system and populist approach to economic management.

Meanwhile, President Thabo Mbeki's cabinet announced that South Africa had set up a task force to develop an emergency intervention plan that will largely focus on reviving Zimbabwe's once prosperous agricultural sector. A special team led by the departments of agriculture, foreign affairs and national treasury would work with other southern African countries on the emergency farm rescue plan.

Diplomats estimate that around US$2 billion could be poured into Zimbabwe in the new government's first year, with more to come later, from the IMF, World Bank and individual Western countries. It is important for the new administration to repeal or reform some of ZANU (PF)'s retrogressive nationalist policies, including plans to transfer control of foreign-owned businesses, including banks and mines, to locals.

Even if the power-sharing administration picks up the pieces and begins the reconstruction of the economy, it could take more than 12 years for Zimbabwe's economy to recover peak levels of per capita income reached in 1991, according to a United Nations Development Programme (UNDP) report.

The report, "Comprehensive Economic Recovery in Zimbabwe", was due to be published on September 19, 2008. Researched and written by five Zimbabwean economists, it is the first economic assessment to be published in the wake of the signing of the power-sharing agreement.

The report estimates that a minimum of US$5 billion (€3.5 billion, £2.7 billion) in foreign aid, including debt relief, will be needed over the next five years  - US$1.62 billion of that in the first year - if the government is to plug financing gaps, revive infrastructure and stave off hunger among the 5 million Zimbabweans threatened by starvation. This would make it one of the largest recipients of aid in Africa.

Those figures would be significantly higher if pensioners were reimbursed for savings eviscerated by the collapse of the currency, and thousands of white farmers driven from their land by Robert Mugabe's resettlement programme compensated.

"Without substantial foreign assistance sustainable economic recovery will be impossible," the report says, adding that the manner in which Zimbabwe tackles structural problems at the outset could determine whether it becomes aid dependent or able, in the long term, to sustain its own development.

The accelerating collapse of the economy is evident everywhere. The governor of the Reserve Bank of Zimbabwe, Gideon Gono, legalised the use of foreign currency for paying for goods and services on September 10, 2008. Allowing the use of foreign currency as legal tender, the governor licenced 1,000 retailers and 200 wholesalers to sell in such currency as the US dollar, British pound sterling and the South African rand. This has led to the opening of new business areas, especially in Harare's plush northern suburbs, where informal shops sell a wide range of products, both imported and locally-manufactured. Gono also announced that it would now be legal for motorists to buy fuel in foreign currency.

The dollarization of the currency will help the fortunate few with access to foreign currency while enabling the government to exercise its political patronage in giving foreign currency licences to favoured retailers and wholesalers. In allowing the use of the US dollar, British pound sterling or South African rand, Gono made no mention of industrialists, farmers and mining companies who, presumably, will be forced to use the local currency.

Zimbabwe's new Prime Minister, Morgan Tsvangirai, re-iterated his commitment to ending acute foreign currency, food shortages and immediate solution to the collapsed standard of education, health delivery system, re-opening of closed companies as well as mapping an aggressive strategy to lure foreign investors.

"The international aid organisations came to help our country and found our doors locked," Tsvangirai said. "We need to unlock our doors to aid - we need medicine, food, and doctors back in our country. We need electricity, water, petrol for our vehicles, we need to access our cash from banks."

With the government out of cash to import food, while many families that would normally be able to buy their own food supplies are unable to do so because of an increasingly worthless currency, it means NGOs would be required to play an even greater role helping to feed the hungry in Zimbabwe.

It is immaterial that the army remains under the control of Mugabe as long as the military act constitutionally and the police under Tsvangirai are empowered to arrest those who do not abide by the law. Once the police ensure that the rule of law prevails and elements such as Jabulani Sibanda and Joseph Chinotimba, Mbare's Chipangano vigilant group are weeded out, Zimbabwe will be well on its way to economic recovery. Otherwise, as long as such undesirable characters rule supreme, the much needed investors will give the country a wide berth.

A new beginning really lies in how much Mugabe and his henchmen are willing to change. The architects of Zimbabwe's economic meltdown should not remain in the driving seat and Mugabe must be acutely aware that his brand of policies will not advance the national interest particularly if private investment and multilateral and bilateral development finance is needed.

With that in mind, one potential problem for the prospects of a successful power-sharing government is hostility from Robert Mugabe's henchmen. Army and secret police chiefs fear they could lose the fortunes they have accumulated under Mugabe's corrupt rule, including formerly white farms which have been confiscated and mines that they now own.

With its ample and superior natural resources, Zimbabwe's flourishing economy has been hindered only by political wrangling for almost two decades. The country is blessed with some of the best farming land, and abundant deposits of assorted minerals that can earn foreign currency. Zimbabwe also has an outstanding ability to produce food crops in excess, not mentioning the world's major cash crops such as tobacco and cotton. Notwithstanding these natural resources, Zimbabwe's outstanding human resource bank and the rich social capital, unparalleled in the region, if not the African continent, provide the most efficient engine for the economic development vehicle.

With judicious planning and benevolent intervention, Zimbabwe's agricultural sector presents a strong backbone to remedying this depressed economy. A resuscitated farming sector will undoubtedly catapult the economy to a vantage step on the ladder of development. It is therefore imperative that the incoming collective leadership prioritise revamping the most important organ of the economy (agriculture) in their bid to effect positive growth.

Urgent reorganisation and holistic support are imperative in order to stimulate farming in Zimbabwe. At least one million people lost their livelihoods and homes as result of Robert Mugabe's controversial farm seizure programme. Prior to the country's politico-economic crisis, agriculture was the largest formal sector employer and made significant contributions to export earnings.

Resettled farmers require relevant and adequate support lest their enterprises fail to realise sizeable returns or break-even. Without high returns, any agricultural enterprise is overwhelmed by the costs of production, rendering it unviable and unsustainable. This has been the latent feature of most, if not all, of the new farmers in Zimbabwe.

Sustainable resettlement and farming require committed political, social and financial exertion on the part of the reigning government. In spite of the so-called betrayal by the colonial master, Britain (who declined, in principle, to fund the chaotic and non-transparent land reform process), Zimbabwean leaders should live up to the ideals of a developmental state and steer the nation on the right trajectory.

In infancy, farmers' businesses need to be nurtured through generous government support, since credit providers usually shun the risk of poor loan repayments. Timely and accurate dissemination of relevant farming knowledge, capital injections and product disposal support are essential. Rejuvenation of the Zimbabwean economy hinges on a vibrant agricultural sector and its reorganisation and support are vital.

This is no time to be wrangling over ministerial portfolios: in the run-up to the news of the power-sharing agreement, the Zimbabwean dollar, trading on the parallel (black) market, collapsed to Z$30,000 to US$1 on September 12, from Z$7,500 a week earlier. True, while economic collapse is a heaven-sent opportunity for Zimbabwe's enterprising traders, it is a disaster for the poor, the elderly and the sick. Basic social services have collapsed in high-density urban areas. Teachers do not report for work; government doctors are on strike, and while private medicine operates relatively efficiently, it is too expensive for the vast majority of the population and doctors and dentists prefer payment in foreign currency.

The middle class, once the bedrock of Zimbabwe's economy has diminished - doctors, teachers, nurses, engineers, artisans and lawyers have left the country. About three million Zimbabweans now live in the Diaspora, mostly in South Africa, Botswana, the UK, the USA and Zambia. An estimated 80% of the remaining population of some 10 million inhabitants lives on less than one US dollar a day. Already a third of the population is being fed by international donors.

A prerequisite for recovery will be plugging vast budget deficits financed in recent years by money-printing and credit creation. This has driven inflation to a world record of about 40 million per cent. The mechanisms used to tackle hyperinflation could make the difference between a short-term bust followed by recovery, and a near-term consumption boom followed by recession.

The power-sharing government will need to act decisively. Price controls that have driven commodities from the shelves should be removed in order to stimulate production. Parastatals need to discard their dependency syndrome and prepare for privatisation. Despite programmes set up by the central bank to avail cheap funds for them, conditions have not improved as inefficiency continues unabated. Some of the parastatals are headed by former army and police officials and need to be demilitarised.

In all these activities, the "depoliticisation" of the Reserve Bank of Zimbabwe is vital. There is a need to restore the credibility and discipline of the central bank and in the financial sector as a whole. The government would have to stop printing money to meet its needs.

The Reserve Bank is said to be technically insolvent and has incurred losses in the region of US$2.5 billion through quasi-fiscal operations. In addition, more money is owed in US dollar terms to exporters, NGOs and individual foreign currency holders.

Long-term budgetary support will be vital to stabilise the economy and will be dependent on the new administration's agreeing a programme with the International Monetary Fund. Donors have yet to allocate specific funds for Zimbabwe and recovery plans of the Multi-Donor Trust Fund (MDTF) administered by the World Bank, are still at a sketchy draft stage.

The Fishmongers Group, set up a year ago on Britain's initiative is said to be willing to provide aid. This group includes the United States, Japan, Germany, France, Sweden, Holland, Norway, Canada and Australia. The Southern African Development Community and private investment capital are also willing to provide aid. However, these financial institutions will bite only if they view the power-sharing settlement as credible.