Economic meltdown and regime change

It is the economy stupid that will force regime change in Zimbabwe

Bulawayo 24 Opinion / Columnist – by Wilbert Mukori

11 Jan 2016

 

"Zimbabwe owes Japan about $400 million - overdue debt. It owes the top five Paris Club creditor nations (Germany, France, Japan, UK and the US) $2,6 billion. Zimbabwe's debt is nearly $10 billion. This would not have been a big deal if the economy was big, and if the debt was not overdue," Yamamoto said.


"I have seen some analyst give themselves comfort by expressing this debt as a percentage of GDP. That is mindless and phoney analysis. Since this debt is overdue and must be paid during the year, it must be expressed as a percentage of the projected government revenue since you don't settle your debt from GDP. Given that Chinamasa projects government revenue for 2016 at $3,8 billion (the actual figures will be far less), this renders the Zimbabwe government technical insolvent. This whole situation took place under Mugabe's watch."

This is spot on! I would only wish to add that Zimbabwe's creditors have all refused to grant the country the "heavily indebted nation status" because they all know that Zimbabwe has the capacity to pay back it debts if the nation's vast resources and wealth were managed properly and not wasted away through gross mismanagement and rampant corruption and looting.

According to Partnership Africa Canada, a Canadian NGO monitoring the world trade in diamonds, Mugabe alone pocketed $2 billion from his share of the wholesale looting going on in Marange and Chiadzwa. The Police, Army and CIO are some of the other local partners with mining concession in the area and Partnership Africa did not know how much they are pocketing. So Mugabe alone is pocketing 20% of the total national debt or more than 53% of Zimbabwe's annual $3.8 billion 2016 budget.

Finance Minister Patrick Chinamasa tired of being asked government was not receiving a dollar from the diamond bonanza told parliament in early 2015 the were no alluvial diamonds left in Marange and Chiadzwa. In his letter to IMF in May 2015, just a few weeks after his statement to parliament, the Minister change his story; he diamond operators were facing some serious problems and government had decided to stop collecting tax to give the industry the chance to recover. He knew the IMF and the world know the mining in Marange had not stopped but, if anything gone into overdrive!

One has to agree with the debtors granting Mugabe "most indebted nation status" will have encourage him to borrow even more with no intention of paying back as before and he would have expand his looting activities beyond Marange and Chiadzwa!

Zimbabwe's economic meltdown is of Mugabe's own making and after 36 years of gross mismanagement, rampant corruption and reckless borrowing and spending the chicken have finally come home to roost in the millions, like red-billed quelea. Mugabe was able to bribe, bamboozle, rig elections, threaten and even murder his political opponents and critics to stay in power.

However he has failed to rig economic prosperity and it is Zimbabwe's economic collapse and mass poverty that will, in the end, force him to give up power! It is the economy stupid that will deliver regime change in Zimbabwe.
 
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Nomusa Garikai <zimbabwesocialdemocrats@gmail.com


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