Why Zimbabwe remains poor

Previously I wrote on why Zimbabwe is poor. In that article, I postulated that we are poor but rich because most of us have abdicated our responsibility of creating a new Zimbabwe to a political liberation struggle elite which does not necessarily see what we see.

Vince Musewe

Vince Musewe

As a result, we have a fundamental disconnect of expectations and values between us young progressive and educated Zimbabweans worldwide, who believe that our country can indeed be 100 times better (if not more) than it is, and our political leadership who do not necessarily have the same vision for Zimbabwe as we do.

Further to that, we have unfortunately left politics and power to those who are not necessarily in a position to help us to achieve our vision of a prosperous highly productive economy which meets the aspirations and protects the rights of all our citizens. I concluded that we therefore need a second revolution driven by a profound paradigm shift to re-invent Zimbabwe.

This week I want to talk about why we have remained poor over above political reasons and the fact that the struggle elite never really had an economic transformation agenda in the first place, but merely had a strategy of the transfer of political power from Smith to Mugabe as an end in itself.

ZANU (PF)’s ultimate aim was always to create a one party capitalist state dominated and controlled by a predatory leadership and a predatory coalition (a “comprador bourgeoisie” as Ibbo Mandaza likes to call it) and this they have achieved much to our detriment. We need to change that paradigm, but that paradigm will not change as long as Mugabe is entrenched at State house.

Erik S. Reinert, the renowned developmental economist, in his book- How rich countries got rich and why poor countries stay poor- clearly articulates the economic conundrum faced by Africa and Zimbabwe in particular in that the economic model we have pursued post-independence ‘specialises in staying poor” and I am intrigued by his argument.

According to Erik, countries like ours are failing to develop because our economy has remained a primary producer and unfortunately continues to compete on the basis of factor endowments, with growth dependent primarily on low-skilled labour and natural resources. This limits economic opportunities, incomes and the wealth creation potential for our citizens and hence millions of skilled and highly educated Zimbabweans have left the country for lack of opportunity and economic freedom.

Added to that, over the last 16 years, Zimbabwe has also effectively de-industrialised and thus destroying any hope of developing an industrial base and creating a sustainable foundation for further development and wealth creation for our citizens and the country as a whole.

According to Erik, any economy which relies heavily on natural resources as its primary products, cannot achieve increasing marginal returns as opposed to an industrialised economy. Our reliance on natural resources limits future growth due to decreasing marginal returns and therefore we have inadvertently “specialised in being poor”.

This to me is a very important observation. Erik further argues that the economic solutions which are prescribed to developing nations by organisations such as the IMF and the World Bank, are certainly not the same economic solutions which got the West rich.

The West got rich through industrialisation and access to markets by hook or crook. This included securing colony markets, for example, and effectively banning or deliberately stifling the emergence of manufacturing industries within colonies. In addition to that, international trade laws ensured that the West had guaranteed access a huge ready market of consumers for their products in the colonies. We can then add technological advances which continue to make the manufacturing of products cheaper and you have a formula for the accumulation of prodigious wealth for the West at the expense of the developing nations.

Interestingly enough China has used the very same model of rapid industrialisation and the manufacture of cheap goods for African markets. However, China has been very smart by not using force or politics as the West did. Instead it has come in through the back door and a devious strategy of being a “friend” to Africa and yet their ultimate objective is to use the very same economic development model which the West used at the expense of Africa once more. This clearly means our African leaders have been duped once more.

I have argued before that China is the new coloniser. In our case in Zimbabwe the “all weather friend” rhetoric is a ridiculous proposition which has been embraced by ZANU (PF) hook line and sinker to the advantage of China.

The solutions to all this for us are very clear. Here, I always remember Oliver Mtukudzi’s song- Wake up open your eyes. We have to wake up and open our eyes in Zimbabwe and in Africa as a whole and realise that unless we pursue a rapid industrialisation strategy and begin to manufacture the goods which we consume, we will remain specialists in poverty as suggested by Erik.

When I see, for example, the incessant obsession by ZANU (PF) on the ownership of natural primary resources such as land and minerals without a deliberate drive to create our own indigenous industries using these resources my heart bleeds. We are our own worst enemies indeed.

This takes us to the Marshall Plan which I am promoting post Mugabe era. Our only solution is deliberate rapid industrialisation and the rapid rehabilitation of our infrastructure. We have to re-invent our economy from one that is dependent on agriculture and mining to one that is dependent industrialisation and manufacturing so that we can pursue increasing returns and create sustainable wealth. This requires new capital but also a clear vision at the top.

In my opinion, Zimbabwe needs a fresh start driven by a new political leadership who appreciate the potential of this country and the need to create a new economy. Definitely not Chinamasa’s new economy of vendors but an industrialised one.

Zimbabwe remains poor by choice and for the lack of vision. It is our responsibility to create that new vision, no matter the cost.

Another Zimbabwe is possible!

Vince Musewe is an economist and author based in Harare. He is also the PDP Secretary for Finance and Economic Affairs You may contact him on vtmusewe@gmail.com. He writes in his personal capacity.

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Post published in: Business