Zimbabwe’s hide and seek with the IMF

In this, the first of a series by PATRICK BOND, he examines the root causes of Harare's fiscal crisis and the role played by the IMF in the nation's descent into financial chaos. Zimbabwean president Robert Mugabe's 2005 fight with the International Monetary Fund illustrated adverse power relations

in which financial pressure is specifically applied in the interests of economic (not political) liberalisation. However, whereas the IMF has no confessed interest in human rights and political freedom (and demonstrated as much in late 1990s Zimbabwe), Pretoria’s discourses do include good governance rhetoric. Combining pro-market and (surface-level) pro-democracy arguments allows Thabo Mbeki to serve as proxy for the IMF, which above all wants repayment on vast arrears, but which also insists on the full range of Washington Consensus policy changes. To make those changes would undercut Mugabe’s patronage system, and might also generate popular unrest. For South Africa, meanwhile, the objective appears to be an elite transition that keeps Mugabe’s Zanu (PF) party in power after his retirement, maintains the splintering Movement for Democratic Change as a token opposition, and imposes severe cuts in the social wage on the citizenry while opening the door for bargain sales of Zimbabwean assets to South African suitors. But the contradictions in these projects occasionally appear, and it remains for the beleaguered left social forces to take advantage of the extraordinary opportunity to press home the critique of both international finance and regional sub-imperialism. In Southern Africa, the Bretton Woods Institutions have become sufficiently notorious within the political intelligentsia as to attract these words from leading African National Congress official Sidney Mufamadi: ‘As we speak, the neoliberal orthodoxy sits as a tyrant on the throne of political-economic policymaking. The dominant social and economic forces are doing their utmost to hegemonise the discourse – both materially and in respect of how developmental processes are to be institutionalised and theorised. Among other things, they use such transnational governmental organisations as the International Monetary Fund (IMF), the World Bank and the World Trade Organisation to shape the discourse within which policies are defined, the terms and concepts that circumscribe what can be thought and done.’ This quote is worth keeping in mind, in part because of its author’s own close comprehension of World Bank activity in South Africa. That point we return to in the conclusion, but it serves to introduce the question of how the region’s dominant social and economic forces intend to hegemonise political transition in Zimbabwe. One objective is to bring the IMF back into play as a policy determinant, for the first time since 1999. Indeed, recall that a decade ago, Robert Mugabe’s regime was a successful prot-g- of Washington financiers. This judgment followed 15 years of arm-twisting by the Bank and IMF, leading to the Economic Structural Adjustment Programme (ESAP) and crash of manufacturing and the social wage. As a result mainly of popular resistance, things began to go badly wrong for Harare’s elites soon thereafter. From 1996-2000, a series of overlapping worker/peasant/student/war veteran rebellions became a serious threat to the ruling Zimbabwe African National Union (Patriotic Front) party. Mugabe adopted a zig-zag political-economic ‘policy’ based on a mix of carrots and sticks, combining frontal attacks on poor and working-class urban Zimbabweans with fiery anti-imperialist rhetoric. At the heart of Harare’s fiscal crisis are Mugabe’s expensive carrots to disgruntled sections of society: large new pensions for tens of thousands of Liberation War vets (previously ignored or repressed) from September 1997; periodic payolas of various kinds to the army and police, including license to loot the Democratic Republic of the Congo during the late 1990s civil war; on-again/off-again price controls from 1998, in order to prevent further ‘IMF Riots’ (which had broken out periodically during the 1990s); occasional gifts to key constituents during the early 2000s, such as very inexpensive rural electricity; and state-sponsored land invasions immediately following Mugabe’s defeat in a constitutional referendum in February 2000, as the opposition Movement for Democratic Change became a threatening electoral force. The sticks we learned much more about during 2005. They don’t need recounting in detail, but include, in the words of South African Communist Party (SACP) general secretary Blade Nzimande, ‘the wanton destruction of homes and community facilities’ for more than a million of the urban poor, and ‘anti-democratic legislation, including legislation directed against the right to assembly and against media freedom’.- First published in Review of African Political Economy and Monthly Review. Patrick Bond directs the University of KwaZulu-Natal Centre for Civil Society: http://www.ukzn.ac.za/ccs

Post published in: Economy

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