Un(Bond)ing Zimbabwe’s financial confidence: bond notes, people and politics

Tinashe Nyamunda looks at Zimbabwe’s ‘liquidity crunch’

A political storm is brewing in Zimbabwe over the introduction of some US$75 million worth of bond notes, initially scheduled for the end of October but which the Reserve Bank of Zimbabwe (RBZ) has delayed to November – or even December (as it is unsure of public response).

This is sparking protests from different political movements in Zimbabwe – such as the Evan Mawarire-led #thisflag and Prosper Mkwananzi’s #tajamuka – and government faces legal challenges from former Vice-President and leader of the newly-formed Zimbabwe People First (ZPF) Joice Mujuru, prominent Harare businessmen Fredrick Mutanda, and lawyer Fadzai Mahere. Many see the notes as unbacked bond paper with currency denominations printed on them. They believe their value will rapidly collapse.

This is despite the US$200 million dollar facility that the RBZ claims to have accessed from the African Export Import (Afrexim) Bank to back the new bond notes and hold their value.

But, as economist John Robertson has argued, ‘money is all about trust’. The people of Zimbabwe do not trust the bond notes because of the horrors of Zimbabwe’s recent hyperinflation past. For that reason, their introduction is seen as the act of a desperate and predatory government seeking to return to worthless Zimbabwe dollars. Many believe that this will only result in ordinary people suffering, while providing new avenues of accumulation for the political elite. (Read more…)

Wed, November 23 2016 » Economy, Zimbabwe Review » Leave a comment

The Threat of “Normalising” Authoritarian Rule in Zimbabwe

By Brian Raftopoulos

Since the end of the Global Political Agreement (GPA) in 2013, a SADC facilitated settlement that sought to move Zimbabwe out of the legitimacy crisis of the widely discredited elections of 2008, Mugabe’s Zanu PF has been battling to find ways to re-engage Western Governments and the international financial institutions based on limited economic and political reforms. After some early indications in the post-GPA period that the Government of Zimbabwe was keen to cooperate on reform measures set by the international financial institutions, Zanu PF has persistently displayed its determination to avoid any serious reforms.

Apart from a more pragmatic if still unclear enunciation of the indigenisation programme, based on the 2007 Act which established the requirement of 51% ownership by ‘indigenous Zimbabweans’ of all foreign owned companies, and small changes to improve the business environment and facilitate business dealings, there remains a major reluctance to engage in more substantive reforms demanded by donors and the MDC formations. (Read more…)

Sun, November 13 2016 » Global Political Agreement, Human rights, Zimbabwe Review » Leave a comment

The Persistent Crisis of the Zimbabwean State

Brian Raftopoulos, Director of Research Solidarity Peace Trust.

Introduction

Since the 2013 elections the convulsions within the ruling party have intensified to unprecedented levels. In response to this phenomenon there has been a good deal of analytical commentary on these struggles, focusing on the nature and causes of the contestations and centring mainly on the central question of Presidential succession. 1 Common to all the analyses is the challenge of stabilising and democratising the Zimbabwean state by dealing both with the legacies of colonial period and their continuities, as well as their new iterations, in the post-colonial era. This is not a problem peculiar to Zimbabwe, and in different forms continues to haunt the state in post-colonial Africa, as it is forced to contend with the legacies of both structural inequalities and despotic forms of rule. 2

In Zimbabwe this problem has manifested itself in a centralised, authoritarian ruling party that has conflated its operations with that of the state and overseen the erosion of the capacity of state structures to deliver to and protect the broader citizenry. In the rural areas the state has entrenched its power bases through a combination of coercion, a failure to democratise ‘traditional’ structures and the increasing placement of these under state/party control. Importantly, this consolidation of control in the countryside has also been the result of the delivery of land, with all its attendant problems, through the fast track land reform process. In the urban areas Zanu PF’s control over peri-urban land politics is linked to its undermining of the opposition’s tenuous control of certain urban local government structures and has furthered the reach of Zanu PF’s structures of power and patronage. 3 (Read more…)

Thu, June 9 2016 » Zimbabwe Update » 1 Comment

Hoping without Hope: Murambatsvina – Ten Years On

By Ukuthula Trust & Solidarity Peace Trust

Bulawayo, 6th October 2015

There is desperation. It’s hope without hope. You appear to have a job when in real terms you don’t have a job. You get up and dress every day and go to town and see people passing your stand, hoping maybe you will sell something.

This report is the fifth in a series by the same authors, tracking the impact of Operation Murambatsvina (OM) on the lives and livelihoods of Zimbabweans, in particular in Matabeleland. Once more, we have in many cases managed to relocate specific families and have updated how they have coped, or not coped, with life over the last ten years. We believe this longitudinal research is important as it conveys the lasting impact of gross human rights violations such as those epitomized by OM, as well as providing insight into the current functioning of the informal sector and housing challenges.

The introductory section places the report in the broader socio-economic context. Tracing the damage done by OM over the last decade remains topical at a point where the government of Zimbabwe and the steadily increasing urban vending community are once more at loggerheads. Throughout 2015, there have been running battles between vendors in Harare and the police, and ultimatums issued for vendors to decentralise from Harare’s streets. Yet, the broader economic context is that out of 6,300,000 people in employment in Zimbabwe, approx. 5,900,000 are employed informally. Clearly, once more hounding vendors off the streets is not a solution to the nation’s prevailing economic catastrophe when alternative employment does not exist.

Rights reserved: Please credit the Solidarity Peace Trust as the original source for this material republished on other websites. Please provide a link back to http://www.solidaritypeacetrust.org/download/report-files/Hope%20without%20hope%206%20october%202015.pdf for this report

This article can be cited in other publications as follows: Ukuthula Trust & Solidarity Peace Trust (2015) Hoping without Hope: Murambatsvina – Ten Years On. Durban: Solidarity Peace Trust

Thu, October 8 2015 » Operation Murambatsvina, Reports » Leave a comment

Zimbabwe Beyond July 2013: Prospects for rebuilding vibrant social movements

James Muzondidya. Zimbabwean Researcher and Analyst.

One of the dominant and recurring themes in civil society discourses around the revival and strengthening of the Zimbabwean civic movement is the issue of social movements.  At almost every Civil Society Organization (CSO) workshop/meeting that has been convened since July 2013, there has been a general consensus amongst CSO leaders, policy and strategy advisors and research practitioners that there is a critical need for the civic movement to reconnect with its social base in order to remain relevant, legitimate and powerful. Much more importantly, it has been strongly argued that there is an imperative need for a sustained process of (re)building social movements that can push for the realization of Zimbabwean citizens’ socio-economic rights and interests as well as social and political change. What has, however, been critically missing in this emerging ‘post-July 31 consensus’ is some serious thinking about how this social movement (re)building process is supposed to be done; the kind of social movements envisioned; the opportunities and challenges involved in rebuilding these social movements; the role that contemporary CSOs is supposed to play in the whole process; and the strategies required for such a process to succeed.  This discussion paper seeks to examine the key issues that need to be considered in Zimbabwean civil society’s deliberations around social movement rebuilding. (Read more…)

Tue, June 2 2015 » Zimbabwe Review » Leave a comment