AS 2000 dawned I was at an event where the subject of Zimbabwe came up. Many people in the discussion were adamant President Robert Mugabe would be out of power within a few years.
Then, they said, Zimbabwe would re-emerge as an economic power — Mugabe’s removal was seen as a necessary condition for economic revival.
At the time the economy was in trouble. Zimbabwe’s currency had plunged as a result of huge unbudgeted payouts to war veterans and it was burning money it did not have to prop up the president in the war in the Democratic Republic of Congo.
The year 2000 was seen as a watershed year. For the first time since 1980 the population voted against a Zanu PF plan — the new Constitution — in a referendum at about the same time that a new political opposition emerged, which nearly won the election that year.
It seemed just possible then that Mugabe was on shaky ground.
But 15 years later he is still at the helm and the economy is still in trouble. Meaningful change looks unlikely.
Zanu PF is without a realistic plan for the economy, devoting much of its time to recycling unpopular political lackeys into key positions and fighting over declining spoils.
A feature in a Zimbabwean newspaper last week, titled “2014: The year business would want to forget”, outlined the sombre state of a country that found little to celebrate over the holidays as the nation continued to struggle with limited investment and revenues, job losses, State spending scandals, liquidity issues and high external debt.
Zanu PF’s annual conference last month provided an opportunity to chart a way forward for the embattled economy. Instead, the ruling party chose to focus its energies on the country’s longest-running soap opera — the battle to succeed Mugabe, despite the fact that he is going nowhere.
The 2015 national budget did not inspire confidence. The Finance minister has few options, burdened by political pressure to maintain high recurrent spending of scarce resources, with a huge 76% of revenues going to public service salaries.
He admitted that the growth target for last year, halved to 3,1% from 6% during the year, looked unachievable, given the challenges.
The Confederation of Zimbabwe Industries says deindustrialisation is reaching “catastrophic” levels, with average capacity utilisation in industry down to 36%. More than 600 companies have closed their gates in less than two years.
A survey conducted by the confederation last year said 47% of executives canvassed predicted a recession in the year ahead.
Multilateral lenders are steering clear of Zimbabwe until it finds a way to pay off its large — and mounting — external debt.
Investors remain wary, concerned mostly by a lack of policy certainty.
Many still believe Mugabe’s removal will be the trigger for economic revival. But newly-sworn-in first vice-president, a former Defence minister and one of the most feared and hated men in Zimbabwe, Emmerson Mnangagwa, does not inspire confidence. Things could get a lot worse.
Mnangagwa’s ascent to the second-highest office in the land highlights again that political expediency is what drives the government of Zimbabwe, not the economy, not the interests of investors and certainly not the interests of the people.
By Dianna Games,chief executive officer of African business advisory, Africa @ Work.