The economy in Zimbabwe is facing great difficulties, yet the country still has a well-educated population with high and balanced school admissions and many natural resources. With high poverty levels and an on-going food crisis, development in Zimbabwe is lagging while the state's financial reforms and debt reduction plan give hope that in the future, the economic crisis will be turned on its head.
When the waves of independence reached southern Africa at the start of the 1960s, the then leader, Ian Smith refused to hand power over to the majority of the people as other British colonies had done. Instead, in 1965 “Rhodesia” was declared an independent nation and continued to be led by Smith. The majority of the population were denied the right to vote and Rhodesia received no international recognition. Comprehensive economic sanctions were implemented by western countries, but Rhodesia's political and trade relationship with South Africa limited the effects of the sanctions.
Powerful nationalist movements with Shona, Ndebele and Tonga backgrounds were formed and after many years of a bloody war of liberation, Zimbabwe became independent in 1980. Robert Mugabe became president.
It started off well...
Since then, Mugabe – and first and foremost the Shona people – have been in power. In the 1980s, and beginning of the 1990s, the country made great social progress within healthcare and education, with well-to-do farmers contributing to the country's economic development. The country's democracy, however, was under increasing attack. As early as at the start of the 1980s, there was widespread oppression of the Ndbele ethnic minority and between 1983 and 1986, an uprising within the group was squashed, resulting in 30,000-50,000 people were murdered. Corruption and the oppression of dissidents crept into the system and the economic resources never reached the people.
Zimbabwe had well-developed industry and productive agriculture which was, until the turn of the millennium, dominated by 6,000 well-to-do farmers. The desire for land was strong amongst a population who, in colonial times, had been moved to the least fertile areas. A certain level of land allocation began. In 1999, the Zimbabwean government and aid contributors appeared to be in agreement about a more long-term reform.
Protests and opposition
By the end of the 1990s, there was widespread discontent with an increasingly corrupt and ineffective government and a worsening economy and income. There were constant demonstrations and strikes and the first real opposition party known as Movement for Democratic Change was formed in 1999.
In 2000, Mugabe's ZANU-PF party lost for the first time after a referendum in which the people rejected a new statute that would further strengthen Mugabe's power.
According to the majority of sources the MDC opposition party won the following parliamentary election, but due to electoral rigging and violence, the regime remained in power. In a response to the social and economic setbacks, frustrated farmers were encouraged and given permission from Mugabe to invade the large farms. Both the well-to-do farmers and MDC sympathisers were attacked and murdered. What isn't always mentioned is that the majority of victims were average farm workers. The EU, USA and certain other western countries reacted by imposing restrictive measures (commonly known as “sanctions”) against the government.
Ten years of economic and political misrule followed. Food production sunk catastrophically, since the most productive farms had been taken over, members of the opposition were imprisoned and murdered, inflation spiralled out of control, factories closed and unemployment exploded. For many years, half of the country's population depended on food subsidies.
A new start...
In 2008, after a controversial election in which the opposition appeared to have won with a clear majority, violence from the government broke out against the opposition followers. After far-reaching negotiations and pressure from other countries in the region, a coalition government was eventually established. Mugabe continued to be president and the MDC leader Morgan Tsvangiari was appointed prime minister. Mugabe's ZANU-PF party remained in government, holding responsibility for defence and income generating departments, whilst the MDC were put in charge of of the finance department and the majority of social departments.
Health, education and other social sectors gradually improved and at the same time, the worthless local currency was at an advantage against the US dollar. The country's economy grew for the first time in a decade and for the first time in years there was a certain optimism amongst the people. Nevertheless, there were many problems within the coalition government, with many initiatives being stopped by Mugabe's machinery of power.
Two steps forward, one step back
In 2013, a very positive step was taken. A new statute was approved after a difficult but inclusive process. This limited the post of president to a maximum of two five-year terms, strengthening the government and parliament – at the expense of the president. The new constitution also meant great improvements to women's rights. However since then it has been shown that the difficulties in Zimbabwe are often not a result of insufficient laws and frameworks, but rather compliance with these laws.
The optimism that grew after the coalition government was formed has since been replaced with increasing scepticism among the population about how the new statute really has made a difference.
In the 2013 election, ZANU-PF and Mugabe regained power and the positive trend that began in 2008 has ceased once again. The politics are dominated by internal power struggles, both within the governing party and the opposition, which is now badly divided and weakened. The next election is planned for 2018 and the question of who will take over from the currently 91 year-old president is under constant debate.
Poverty continues to be widespread and according to recent estimates made by the UN, 62.8 % of the population live in poverty with 76 % of them living in the countryside. 16.2 % of the population live in extreme poverty and the country is characterised by prevailing inequality.
Unemployment is also high and in recent surveys the informal sector was estimated to have reached close to 50 % while approximately 80 % of the state budget currently goes on salaries. On top of this, Zimbabwe is expected to be enormously affected by the current and forthcoming years' El Niño. 1.5 million people now live on the edge of famine, despite internationally financed interventions.
There are few glimmers of hope in this economic crisis and downward spiral. Since previous EU sanctions against Zimbabwe were lifted in 2014, the EU now makes up Zimbabwe's second largest trade partner (after South Africa). However restrictive measures remain in place against the presidential couple.
Zimbabwe's external debts are also enormous but in recent times the state has shown a strong interest in policy reforms and a will to manage the country's economic problems. An important step was taken when the Zimbabwean state presented their economic reform and debt annulment plan at the annual meeting of the World Bank in Lima, October 2015. The hope is that this time-demanding process will lead to future programmes with the IMF and WB and other financiers who can create opportunities for Zimbabwe to borrow new money for essential investments.