Joram Nyathi: Cash ‘cancer’ hounds Zim economy

07 Sep, 2014 - 06:09 0 Views
Joram Nyathi: Cash ‘cancer’ hounds Zim economy Minister Chinamasa

The Sunday Mail

Minister Chinamasa

Minister Chinamasa

This time around one didn’t have to be on the side of the opposition, including their many NGO partners, to ask the question.

The media asked it, so did members of parliament in their variegated hues. The difference lay in the tone, tenor or nuance. The question was the same nevertheless, “Did Mugabe bring any cash from China?”

This is a legitimate question to ask. But at its core, that question exposes a disease which has hamstrung national development in a big way. The question betrays the terrible extent of the “cash” cancer.

With your forced indulgence, dear reader, let me come back to this topical debate until Chinamasa gives us the right answer. Allow me a detour into the dreadful area of ebola and second-hand clothes.

Zim Asset, Summit

A key plank of Sadc’s development trajectory underlined at the recent 34th Sadc summit in Victoria Falls was industrialisation of member states. President Mugabe as the new chair of the bloc appealed to South Africa to help fellow members in this endeavour, stressing that South Africa was the most industrialised country in the region.

He said it would be unfair for the regional economic giant to use fellow members as dumping markets or warehouses for its manufactured products. That industrialisation, it was agreed, would be driven by the need for value addition and beneficiation of the region’s primary produce. This is turn would promote intra-regional trade as a precursor to competitive exports into the continent and beyond.

For Zimbabwe, this was not news as such. It is one of the pillars of Government’s economic recovery blueprint, the Zimbabwe Agenda for Sustainable Socio-Economic Transformation. And who better to articulate this cause than our Minister of Industry and Commerce? Yes, Minister Bimha, am I correct?

The minister recently pointed out that he was reluctant to allow for protectionist policies. He said this would protect companies producing shoddy goods. Competition is good.

This makes sense in a normal economy. But there is no single normal economy in Africa, least of all Zimbabwe. The combined effects of sanctions, the country’s debt burden, crippled industrial productivity and teething problems in the agricultural sector post-land revolution all mean that Zimbabwe cannot realistically compete in any field with the exception of skilled labour. It is a stricken vessel.

That subject confronted Honourable Bimha again in the Senate this week. Senator Misheck Marava wanted to know what Bimha’s ministry was doing to protect the textile sector.

Ebola

Given the importance Government attaches to Zim Asset, and the emphasis given to industrialisation at the Sadc summit last month, one expected Minister Bimha to have the answer on his proverbial fingertips.

Yes, he responded, but he didn’t have an answer.

His response came by way of a long detour, even that, not giving a comprehensive answer to the challenges faced by the textile sector in general and cotton farmers in particular. Minister Bimha said he had presented a sector by sector analysis of industry to Cabinet on Tuesday this week in which he expressed his “worry about the issue of second-hand clothes”.

Let me quote him as he is quoted; “What is worrying about these second-hand clothes coming into the country are diseases like ebola because we do not know where those clothes are coming from and who was putting them on because they pass through the borders without checks and evade paying duties.”

Forgive me for belabouring the point on Zim Asset and Sadc’s industrialisation plank. I expected Minister Bimha to be miles ahead of Senator Marava, telling us how his ministry was working on statutory instruments to not only promote a “buy Zimbabwe” culture but also to ensure that local manufacturers have sufficient cotton lint, the technical expertise and that cotton producers get prices that can sustain their family requirements. The former “white gold” has turned into a disaster for farmers in the Gokwe cotton belt due to low prices caused by cheap imports.

No, Minister Bimha. The issue about second-hand clothes is not about ebola. The issue is the textile industry and cotton farmers and jobs being exported because we are not adding value to our cotton.

The issue is that cheap foreign imports, whether they pay duty or not, are killing our economy. The issue is about closing the border to stop imported second hand clothes, not ebola.

There are people better qualified to screen visitors for ebola. David Whitehead Textiles is under judicial management in part because the whole textile sector cannot withstand competition against dumping prices from foreign imports. The land reform can only be deemed very successful once people can prosper from what they produce minister.

Honourable Minister, in its current state, Zimbabwe is not a normal economy to be left to compete, not even in the region, let alone in overseas markets. Protecting vulnerable sectors of your economy is not rocket science. It’s the most mundane of tasks, an instinctive reaction to foreign threats, from Japan to the United States. There is no need to be coy about it and seek to use ebola as a pretext.

We cannot industrialise when we waste scarce foreign reserves on finished imports, some of which don’t pay duty, instead of latest technologies which will allow David Whitehead to produce cost effective end products. That’s what Zim Asset bids us do.

Where’s the cash?

“Mugabe goes begging”, was how one of the daily newspapers put it a day after President Mugabe and his delegation left for China on a week-long State visit. On his return, the same paper crowned its cynicism with, “Mugabe brings back signatures” or something like that, meaning there was no cash.

Another paper called the deals signed with the Chinese “pie in the sky”. It said China gave Mugabe $24 million as “pocket money”, calling this a “practice” of the Chinese.

There is absolutely nothing wrong with media exercising scepticism about such deals, or any promises made by politicians. It is the duty of the media to be the ears and eyes of the people and to be their voice. Public policy and public pronouncements must be scrutinised and exposed for what they are.

It’s however worrisome when institutional prejudice against a cause or a nation allows cynicism to take precedence over critical analysis. Just as an aside, did anybody expect President Mugabe to bring with him a payload of US dollars on his plane?

These are the same talking heads who whined about Zimbabwe missing out on the recent US-Africa summit. How many of the 50 African leaders who attended came back lugging bags of US dollars from the summit? Would President Mugabe have brought back a cent?

Dollarisation brought us a cash economy. The political opposition contributed issues of electoral legitimacy and investor confidence, which only its electoral victory could guarantee the people of Zimbabwe.

On the one hand, sanctions have meant that Zimbabwe cannot engage freely with the munificent Western nations, while on the other, Western propaganda has made Zimbabwe’s dalliance with global rivals, Russia and China, an issue of supreme scorn.

So it was that on the same day that President Mugabe was breaking ground for the construction of the $533 million Kariba South hydro power station to be funded by the China Export-Import Bank to the tune of $320 million, somebody could sneer at Chinese deals as “pie in the sky”.

Finance and Economic Development minister Patrick Chinamasa did not mince his words about the nature of the deals with China. He stated openly what projects would be funded, “Projects must demonstrate their ability to pay for themselves,” he said.

“You will not come to China to ask for money to invest in a project that won’t pay for itself. That would not make economic sense.”

It was not about budgetary support.

But Zimbabweans want immediate cash for consumption.

Long-term investments in infrastructure such as roads, energy and tourism are “pie in the sky”. That’s why our urban roads are clogged with imported vehicles, all of them paid for in cash by the same people acclaimed as the poorest in the region because of the land revolution and indigenisation.

We seem to be the only piece of geographical space under the sun whose cloud has no silver lining.

So who is supposed to come up with “viable projects” which qualify for funding, business or Government?

Or is Government expected to fold its arms waiting for the West to decide that finally Zimbabwe is now open for business?

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