12 zeros gone and Zimbabwe continues to struggle

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Zimbabwe, home to one of the seven wonders of the world Victoria Falls, is a country in turmoil recently in the news battling an inflation crisis.  The country just recently slashed 12 zeros from its currency to fight hyperinflation! Zimbabwe began as part of the British colony, Rhodesia.  From the 1930s to the 1960s, Black opposition to the colonial presence began to grow forming two African groups , the Zimbabwe African People’s Union (ZAPU) and the Zimbabwe African National Union (ZANU).   In 1965, Ian Smith, a British Rhodesian Front party man, signed the Unilateral Declaration of Independence which declared Rhodesia separate and independent from the U.K., which the U.K. would not fully recognize.  The Rhodesian Front party fought for white minority rule which further angered the Black majority.

The ZAPU and ZANU did not stand for this type of governance of their nation and began guerilla war tactics to fight back.  After much violence and negotiation, ZANU finally won British-supervised elections in 1980.  Robert Mugabe (ZANU) stepped into the role as prime minister with ZAPU leader Joshua Nkomo in his cabinet.  On April 18, 1980, Zimbabwe gained international recognition.

The celebration does not last long as Mugabe kicked Nkomo out of his cabinet on suspect of him trying to overthrow the government.  Guerilla warfare broke out yet again killing thousands in the country.  In an attempt to stop the deaths, Mugabe and  Nkomo reconciled and merged their parties to form Zanu-PF in 1987.

Zimbabwe continued in this manner until 1998 when the Zimbabwe Congress of Trade Unions (ZCTU) stepped in to urge action on the rising interest rates and inflation that began to occur in the country.  This crisis sparks support for the  ZCTU and further spurs the Movement for Democratic Change.  At this time, the World Bank and IMF, who provided aid for the people of Zimbabwe, suspended funding over disagreements in government policies and despite increasing economic hardships, companies closing, and national hunger, the World Bank had not yet returned providing aid in May 2009.

According to the World Bank, “[t]he lending program in Zimbabwe is inactive due to arrears. The Bank’s role here is now limited to technical assistance and analytical work focusing on macroeconomic policy, food security issues, social sector expenditures, social service delivery mechanisms and HIV/AIDS.”

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Until the right conditions are met in Zimbabwe, the World Bank cannot continue its lending program there and aid must be channeled through NGOs.  The World Bank also states “[r]e-engagement (a resumption of lending) with the unity government of President Robert Mugabe and Prime Minister Morgan Tsvangirai must be preceded by the government developing a credible economic development program, building consensus and support nationally for the program, demonstrating sustained progress in implementing reforms and clearing debt arrears to international financial institutions.”

With such an unsecure government, however, how can Zimbabwe develop the credible development program the World Bank requires in order to regain their support?  Zimbabwe has been struggling for years at stabilizing the country—will the World Bank’s hold on the lending program really give them the push they need to change?

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10 Responses

  1. Get in the black!

  2. On another note, this post is very interesting. We studied this very issue last year in my Comparative Politics class. I feel the concern that is on everyone’s mind is how to deal with the blatant and rampant corruption. The crooked politicians, if they can even be called that, are the source of the economic problems. Their pocketbooks continue to grow as people starve. I once saw a picture of a man searching through the garbage for food. During his search, he would come across vast quantities of money, but would disregard them because they were completely worthless. You would literally need an entire wheelbarrow full just to buy a loaf of bread. The problem, however, will persist until a responsible government is installed. When that will happen, however, we do not know.

    • What an image in that photo. Is it on-line?

      • The photos are linked and yes they are online.

  3. Obviously, there are financial reasons why modern countries and companies are disinclined to invest in African countries, but if, perhaps, the UN stepped in, something could be accomplished. Unfortunately, with their current reach, today’s UN would not even attempt such a feat, but I think the time is coming where the UN needs to expand their domain and take on a larger role in solving the world’s problems. I would like to see the UN basically create a new country out of Africa, with current African countries becoming states or something equivalent. Starting with the most populated areas, the UN would introduce a military presence and slowly reclaim areas from the warlords and corrupt governments. Well that’s what I’d like to see, in a nutshell, and I think that this would be the most efficient way to restructure Africa.If anyone else has any ideas about how to fix this problem, I’d love to hear them.

    • Like we talked about induced cooperation with Barnard- that management depends not just on giving orders, but on the order-takers to be expected to comply- the same applies to political states. Would the people at all levels of African society cooperate in such an endeavor even if its intentions were thoroughly about helping all people? I think it is more likely they would see it as a rehash of colonial rule.

      Then we are left with a conundrum I think your comment highlights: how can ally nations support self-determination and at the same time universal principles of good government or liberal (as in open society, not left-right)?

      A more concrete example: the US says it supports democracy in Iraq. Well, what if Iraq elects a government that says the will of its people is to resist US occupation and to seek our ouster from the country and the middle east? Iraq is having new elections right now while we have something like 100,000 troops there (maybe?).

      • I completely agree with you, but I’m not necessarily proposing self-determination, because it seems that that has not worked out so far. And as far as getting everyone to cooperate, that obviously will never happen. Not everyone would like the UN coming in and basically saying “this is how it’s going to be”, but the alternatives have not seemed to be effective, and everyday the world spends waiting around, more and more people die from things like malnutrition, malaria, tuberculosis, and others, all of which are small problems elsewhere in the world.

  4. Kelly,
    For me you have put your finger on a perennial question. What is the sequencing of improvement in economics and government? Is there any clear empirical evidence about which needs to come first, or which comes first under what conditions. One of the sad facts about Zimbabwe, i gather, is that it did have a pretty good economy at one point with very rich agricultural resources. Hence, improving government first, in this case, may unlock the latent economic strength there. The inflation is a political problem first.

    In contrast, maybe Haiti needs help on its economy first as it may not have as much latent economic strength. Once sustained economic development occurs, then there will be enough internal resiliency and enough civil society to sustain concerted efforts to improve government transparency and positive reform.

    • You are correct in that Zimbabwe used to have a pretty decent agricultural economy. That all fell apart and the country finds itself in its current state. I also wonder whether government or economy needs to come first, but I think it must be some combination of the two together. Zimbabwe and Haiti need a government to control the situation occurring around them, but at the same time, the government can only gain power and respect when the economy is stimulated.

  5. […] 12 zeros gone and Zimbabwe continues to struggle […]

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