Why a Mnangagwa presidency would not be a new beginning for Zimbabwe


Hazel Cameron, University of St Andrews

Despite claims to the contrary by the Zimbabwean military spokesperson Major General Sibusiso Moyo, Zimbabwe is in the throes of its first coup d’état since independence in 1980. Robert Mugabe, the only head of state the country has known in its 37-year existence, is today under house arrest, and the former vice president, Emmerson Mnangagwa, who has long aspired to succeed Mugabe, has returned to Zimbabwe from South Africa, after having fled on November 6.

It appears that Mugabe’s decision to sack Mnangagwa – possibly at the behest of his wife, Grace Mugabe – may turn out to have been his last major decision as president.

These events have provoked much interest and anticipation around the world, and not least from Zimbabwe’s former colonial master, the UK. The British foreign secretary, Boris Johnson, stated in the House of Commons on November 15 that:

this House will remember the brutal litany of [Mugabe’s] 37 years in office; the elections he rigged and stole; the murder and torture of his opponents … Authoritarian rule, whether in Zimbabwe or anywhere else, should have no place in Africa.

Johnson also warned against any transition “from one unelected tyrant to the next”.

For the past three years, the British government has displayed an interest in reengaging with Zimbabwe. It is an open secret that Britain’s re-engagement identified Mnangagwa as the candidate they could best work with. When the current British ambassador in Harare, Catriona Laing, took up her post in September 2014, her mission was to “rebuild bridges and ensure that re-engagement succeeds to facilitate Mnangagwa’s rise to power”. In September 2017, it was reported that British diplomats were working to secure a Mnangagwa succession “with a US$2 billion economic bail-out underwriting the project”.

According to diplomats with direct knowledge of succession discussions surrounding the rebuilding of post-Mugabe Zimbabwe, Laing has not wavered in her support for Mnangagwa to succeed Mugabe and, since Mnangagwa’s hasty retreat to Pretoria on November 6, it seems the British have worked tirelessly behind the scenes to facilitate Mnangagwa’s unhindered return to Zimbabwe and installation as president of the ZanuPF government. It has been reported that plans to take over the country by force have been in place for some time – and that Mnangagwa was instrumental in those plans

There are unconfirmed reports that a new post-Mugabe deal is under discussion. Under its terms, Mnangagwa would lead a transitional government in Zimbabwe with the support of other political parties leading to full elections in five years’ time. There are suggestions that Mnangagwa has the backing of the Chinese – who recently met with the commander of the coup, General Constantino Chiwenga – while the South African government allowed him to return to Zimbabwe unimpeded on November 15.

So it seems the end of the Mugabe era has come. But one has to ask whether a Mnangagwa presidency would really be a new beginning.

The Crocodile’s credentials

Mnangagwa, known as The Crocodile, has throughout the history of Zimbabwe been complicit in the manipulation of the ZANU-PF election process by promoting violence, intimidation and repression as well as illegal administrative strategies to ensure ZANU-PF election success. He has also long faced allegations of corruption and diamond looting in both Zimbabwe and the Democratic Republic of the Congo.

In 2012, the NGO Global Witness released an investigative report that revealed how ZANU-PF and the military elite used the proceeds from looted diamonds to fund human rights abuses. The report specifically points to the complicit conduct of Mnangagwa and his ally Chiwenga.

Mnangagwa has also been accused of playing a pivotal role in the Matabeleland Massacres of 1982-1987. In January 1983, Mugabe launched a massive security clampdown on the unarmed citizens of the Matabeleland region, violence that was both politically and ethnically motivated. This episode of relentless and persistent state-orchestrated violence, known as Gukurahundi, was perpetrated by an elite army unit known as the Fifth Brigade. It is estimated that 20,000 people were massacred and many hundreds of thousands of others tortured, beaten or raped. Mnangagwa has denied involvement and has blamed the army.

On March 4, 1983, at a rally held not far from Lupane in Matabeleland, Mnangagwa publicly conflated being a citizen of Matabeleland with being a political dissident. According to news reports at the time, he told his audience the government had “an option” of “burning down … all the villages infected with dissidents”, saying “the campaign against dissidents can only succeed if the infrastructure which nurtures them is destroyed”.

He described dissidents as “cockroaches” and the Fifth Brigade as “DDT” brought in to “eradicate” them. In short, he made it clear that the destruction of the civilian population of Matabeleland was part of a deliberate state policy – and the very next day came the country’s worst massacre yet, on the banks of the Ciwale river, when 62 people were killed.

The crimes against humanity perpetrated in Matabeleland left hundreds of thousands traumatised – many still don’t know where their loved ones are buried. The victims of Gukurahundi are deeply divided, stigmatised and discriminated against. Their plight will go unaddressed if the person who succeeds Mugabe is himself responsible for appalling political crimes and harms to which millions of Zimbabweans have been subjected.

If Zimbabwe is to step back from the brink of state failure, it must find a way to address the Mugabe regime’s crimes, including Mnangagwa’s role in Gukurahundi. At the very least, Zimbabwe’s neighbours and the international community alike must stand in the way of those responsible for state-sponsored atrocities and corruption that have been the hallmark of Mugabe’s government for 37 years obtaining or maintaining positions in the post-Mugabe government of Zimbabwe.

The ConversationIn order to promote a stable, secure and reconciled Zimbabwe, the crimes of the regime of Mugabe must be addressed, and this includes Mnangagwa’s crimes and his role in Gukurahundi. The British government seems to have other plans.

Hazel Cameron, Lecturer of International Relations, University of St Andrews

This article was originally published on The Conversation. Read the original article.

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Mnangagwa and the military may mean more bad news for Zimbabwe


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Reuters/Philimon Bulawayo

James Hamill, University of Leicester

The military has taken control of the national broadcaster, troops are in the streets and the president is being held in a secure environment. All military leave is cancelled and a senior general has addressed the nation. Yet the Zimbabwean military continues with the pretence that this is not a coup d’etat.

The obvious response to this is: if it walks like a duck and quacks like a duck then the chances are it’s a duck. And the sole reason the Zimbabwean military is not acknowledging this as a coup d’etat is to avoid triggering the country’s automatic suspension from the African Union and the Southern African Development Community (SADC). Both bodies frown on coups.

A perfect storm formed ahead of these events and made military action predictable. The country had once again entered a steep economic decline (not that its “recovery” had been anything of note). A clear and reckless bid for power was being made by the so-called Generation 40 (G40) faction around Grace Mugabe in direct opposition to the Vice President Emmerson Mnangagwa, the standard bearer for the so-called Lacoste faction.

This culminated in Mnangagwa’s dismissal by President Mugabe: a clear indication that Grace Mugabe was now calling the shots. It also served as a follow up to the 2015 Grace-engineered dismissal of another Vice President and rival, Joice Mujuru.

The coup means that Mugabe’s long and disastrous presidency is finally over. The only questions that remain are the precise details and mechanics of the deal which secures his departure.

Why the coup

Mnangagwa is a long time Zanu-PF stalwart and is clearly closely integrated with the military high command and the intelligence services. Both institutions are concerned that the succession is being arranged for a faction led by people with no liberation credentials but who have been skilled in manipulating Mugabe himself and in making him do their bidding. The G40 now appear to have overreached, perhaps believing that their proximity to the “old man” made them invincible.

This coup’s explicit purpose is twofold. First, it’s trying to definitively kill off Grace Mugabe’s ambitions to become president and to set in place a ruling dynasty akin to the Kims in North Korea. Second, it’s a bid to clear Mnangagwa’s path to power, first in Zanu-PF and then within the state itself (over the last three decades these have been virtually one and the same thing).

What we do not yet know is what counter force, if any, the G40 can bring to bear against the military. The calculation of the military hierarchy appears to be that Grace and company are paper tigers who will have few cards to play against such force majeure and who lack the popular appeal to bring angry and disillusioned masses out onto the streets.

Could this be the end of President Robert Mugabe’s 37 year reign?
Reuters/Philimon Bulawayo

The coup has formally stripped away the façade that Zimbabwe is a constitutional state. This is clearly a militarised party-state where the military is a pivotal actor in the ruling party’s internal politics. It is not simply a neutral state agency subordinate to the civilian leadership. And the idea that this military intervention is an aberration – a departure from the constitutional norm – is misplaced.

Zimbabwe is a de facto military dictatorship. It serves as a guarantor of ZANU-PF rule rather than as a custodian of the constitution. It has helped Zanu-PF rig elections. And it was central to the state terror which was unleashed against the population to reverse Mugabe and Zanu-PF’s electoral defeat in 2008. The military has always been a key political actor. The only difference this time is that its intervention is designed to control events within Zanu-PF rather than to crush opposition to it.

But, a highly politicised military is a major impediment to the re-establishment of a democratic order in Zimbabwe. It has nothing to gain, politically or financially, from democratic rule given the lucrative networks of embezzlement and plunder it’s put in place over decades. Most recently it seized and siphoned off of the country’s diamond wealth for military officers and the party hierarchy.

Zimbabwean President Robert Mugabe and former Vice President Emmerson Mnangagwa.
Reuters/Philimon Bulawayo

This intervention is designed to secure the presidency for Mnangagwa. So it is hard to avert our eyes from the elephant –- or in this case the Crocodile –- in the room. Mnangagwa is the Mugabe henchman who helped enable the misrule and tyranny of the last 37 years. He was one of the principal architects of the Gukurahundi -– the genocidal attack on the Ndebele – in the early to mid-1980s which left at least 20 000 people dead.

He has also been instrumental in rigging elections and crushing all opposition to Zanu-PF rule, including the atrocities of 2008.

Expecting such a person to now make a deathbed conversion to the democracy, constitutional government and good governance he has spent an entire career liquidating is dangerous nonsense.

Dilemmas to come

Mnangagwa will soon have to confront a series of dilemmas. How can he put in place an administration which has the appearance of a national unity government, can secure international approval and the financial assistance required to help rebuild a shattered economy – but avoid ceding any meaningful power or control? Can this circle be squared?

The best hope for Zimbabweans is that the international community uses its leverage wisely and sets stringent conditions for such assistance: free elections closely monitored by an array of international organisations, the establishment of a new electoral commission, free access to the state media and the right of parties to campaign freely.

There should also be a role here for South Africa to restore its badly tarnished image as a champion of democracy in Africa. It has followed a malign path over the last two decades, facilitating Zanu-PF authoritarianism in the name of a threadbare and increasingly degenerate “liberation solidarity”.

The ConversationSuch a combination of pressures will severely restrict Mnangagwa’s room for manoeuvre. Anything short of that will deliver an outcome which is essentially Mugabeism without Mugabe.

James Hamill, Lecturer in Politics and International Relations, University of Leicester

This article was originally published on The Conversation. Read the original article.

After coup, will Zimbabwe see democracy or dictatorship?


Steven Feldstein, Boise State University

For decades, Robert Mugabe ruled Zimbabwe in a ruthless, even reckless manner. Over nearly 40 years, he turned the “jewel of Africa” into an economic basket case that’s seen inflation of up to 800 percent.

Then, late in the night of Nov. 14, the country’s security services detained and put Zimbabwe’s 93-year-old president under house arrest in what appeared to be a military coup. The whereabouts of his powerful wife, Grace, are unconfirmed.

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Much remains unclear at this early stage. Will violence erupt? Is this really the end of the Mugabe era?

I don’t know the answers to those questions yet. I’m not sure even Vice President Emerson Mnangagwa, who appears to have orchestrated Mugabe’s overthrow, knows how his gambit will turn out.

But with each passing hour, it is increasingly evident that Zimbabwe – a country whose politics I spent uncountable hours grappling with as a State Department official – is poised to see its first real leadership transition since 1980.

Setting the stage for Zimbabwe’s coup

For decades, Mugabe’s grip on Zimbabwe was iron-clad. Even when challenged by an invigorated opposition in 2008, he kept the presidency by entering into a nominal power-sharing agreement. After a decisive electoral victory in 2013, though, he cast the coalition aside.

But as the elderly president grew increasingly frail this year, the power struggle to succeed him became frenzied. Two major camps were vying for power.

Vice President Emerson Mnangagwa, who as a soldier fighting for Zimbabwe’s liberation earned the nickname “the crocodile,” represented the old guard. The 75-year-old enjoyed strong military backing, particularly from the veterans’ association, a powerful coalition of former combatants from Zimbabwe’s independence struggle which began in 1964 and ended in 1979.

Last year, the group broke with Mugabe in a public letter, declaring that he had “presided over unbridled corruption and downright mismanagement of the economy, leading to national economic ruin.” Many believed that Vice President Mnangagwa orchestrated the group’s letter as a shot across the bow to warn would-be rivals.

The second camp jockeying to control Zimbabwe before the coup was led by Mugabe’s current wife, Grace Mugabe. At a relatively spry 53, she represented the younger generation, drawing significant support from the ruling party’s loyalist Youth League and from an informal grouping of emerging leaders known as “Generation 40.”

But Grace Mugabe was deeply unpopular among ordinary Zimbabweans, who called her “Gucci Grace” because of her extravagant spending. Plus, she had a reputation for cruelty. Earlier this year, the president’s wife faced accusations of beating a 20-year old South African model with an electric cable.

In September, after Vice President Mnangagwa was emergency airlifted to South Africa due to a strange illness, Grace Mugabe had to publicly deny, on state TV, that she had poisoned her rival.

As recently as early November, it appeared that Grace’s camp had prevailed. President Mugabe sacked Mnangagwa, who fled to South Africa. Mnangagwa, it seems, had a different plan. While in exile, he stayed in touch with his military allies.

On Nov. 14, Mnangagwa’s camp struck back. By the next morning, Mugabe was under house arrest, his wife had reportedly fled to Namibia seeking asylum and Mnangagwa’s cohort appeared to control the country.

Democracy or dictatorship?

At least, that’s the picture right now. Events have moved swiftly in the last 24 hours, and some big questions remain unanswered.

If Mnangagwa officially takes power, the first unknown is whether he will rule by fiat or cobble together a transitional government. It’s unclear whether Mnanangwa and his allies have any real interest in introducing democracy to Zimbabwe. To do so, they would need to hold an election within a reasonable period of time, say six months.

Military coups don’t have a promising track record of ushering in democracy. Recent scholarship finds that while “democratization coups” have become more frequent worldwide, their most common outcome is to replace an incumbent dictatorship with a “different group of autocrats.”

Signals in Zimbabwe are mixed so far. Experts generally describe the latest developments as “an internecine fight” among inner-circle elites and ask two key questions: Which side will prevail, and will violence break out?

In my assessment, the answers hinge on Mnangagwa, a hard-nosed realist and survivor who was critical in securing Mugabe’s four-decade rule. Mnangagwa has an appalling human rights record. Many consider him responsible for overseeing a series of massacres between 1982 and 1986 known as the “Gukurahundi,” in which an estimated 20,000 civilians from the Ndebele ethnic group perished.

More recently, in 2008, civil society groups accused Mnangagwa of orchestrating electoral violence against the political opposition and rigging polls in Mugabe’s favor.

It is also true that Mnangagwa is massively invested in ensuring his continued and unfettered access to power, which has proven highly lucrative for him. The vice president is “reputed” to be one of Zimbabwe’s richest people. All of this suggests he might become yet another dictator.

‘Unity’ for Zimbabwe?

Nonetheless, reports indicate that Mnangagwa is currently talking to several opposition parties about potentially forming a transitional government.

A key stakeholder in any such arrangement would be Morgan Tsvangirai of the Movement for Democratic Change, who served as prime minister to Mugabe as part of the 2009 power-sharing agreement.

That coalition achieved some success on economic matters, but Mugabe’s party never relinquished any real authority. Mnangagwa was among those who clung to power back then, but I believe he might play things differently now. Mnangagwa is no reformer, but he does need to find ways to bolster his legitimacy. Not to mention he will quickly need to confront Zimbabwe’s massive economic woes.

The choices that Zimbabwe’s political leadership makes in the coming weeks will have immense consequences for the future of a country whose development has stagnated under 40 years of authoritarian rule.

The ConversationReal transitions in Zimbabwe are all too rare. Mugabe led the country to independence in March 1980, assumed the presidency and never left. His demise represents a chance for a political reset.

Steven Feldstein, Frank and Bethine Church Chair of Public Affairs & Associate Professor, School of Public Service, Boise State University

This article was originally published on The Conversation. Read the original article.

A military coup is afoot in Zimbabwe. What’s next for the embattled nation?



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President Robert Mugabe and his wife Grace have become increasingly divisive figures in Zimbabwe.
Reuters/Philimon Bulawayo

David B. Moore, University of Johannesburg

Nobody is safe from the rages of Zimbabwe’s First Lady, “Dr. Amai” Grace Mugabe. There was the young South African model Grace lashed with extension cords. 93-year-old President Robert Mugabe’s longtime and usually trusted ally Emmerson Mnangagwa, was next in the firing line: he was sacked because his supporters allegedly booed her at a rally.

The consequences of her vengeance may have led to a coup headed by Zimbabwe’s army chief General Constantino Chiwenga, who is commonly perceived to be Mnangagwa’s protégé. But ex-freedom fighter Mnangagwa has his own presidential aspirations.

Mnangagwa has been exiled from the party in which he has served since he was a teenager. But he is not just skulking in the political wilderness. On arrival in South Africa he issued a statement calling those who wanted him out “minnows”. He promised to control his party “very soon” and urged his supporters to register to vote in the national elections next July.

As if to back Mnangagwa, on November 13 General Chiwenga announced that he and his officers could not allow the “counter-revolutionary infiltrators”, implied to be behind Grace Mugabe, to continue their purges.

Factions and purges

Chiwenga declared that the armed forces must ensure all party members attend the extraordinary Zanu-PF congress next month with “equal opportunity to exercise their democratic rights”. He flashed back through Zanu-PF’s history of factionalism, reminding his listeners that although the military “will not hesitate to step in” it has never “usurped power”. Chiwenga promised to defuse all the differences “amicably and in the ruling party’s closet”.

Although this airbrushed more than it revealed about the party’s rough patches when leadership vacuums appeared, the statement appeared more as a cautionary note than a clarion call to arms. It’s not often a coup is announced before it starts; but once in motion direction – and history – can change. Grace Mugabe may have unleashed a perfect storm and her own undoing.

Soldiers stand next to a tank on a road in Harare.
Reuters/Philimon Bulawayo

All the “shenanigans” that have inspired the generals to consider a coup have set the stage for an extraordinary Zanu-PF congress this December instead of in the expected 2019: that is, before rather than after the July 2018 national elections.

This suggests some people were in a hurry to settle the succession issues for the president, who is now showing every one of his 93 years. Maybe Robert Mugabe won’t rule until he is 100-years-old. If not, and members of his family or party wanted to keep their dynasties alive, they had to work quickly lest some similarly inclined contenders are in their way.

These contenders include Mnangagwa and a slew of his “Lacoste” faction consisting of war veterans and the odd financial liberal. The best-known of these is Patrick Chinamasa. This former finance minister tried to convince the world’s bankers he could pull Zimbabwe out of the fire. He was demoted to control cyberspace and then fired. Perhaps he may make a comeback in the wake of the semi-coup.

The pro-Grace faction includes the members of Generation 40, or “G-40”. Many are well over 40. But in Robert Mugabe’s shadow they appear young, as does the 52-year-old First Lady. Without a base in the liberation-war cohort, they resorted to working with the Mugabe couple: sometimes their ideology appears radical, espousing indigenous economics and more land to the tillers.

If the history of their best-known member – the current Minister of Higher Education Jonathan Moyo – is indicative, however, they are pragmatic; or less politely put, opportunist.

But with Grace Mugabe sans Robert, they would have to muster inordinate amounts of patience and manipulation to steer the sinking ship to the shores of stable statehood and incorporate yet younger generations who cut their political teeth as Robert Mugabe’s rule faltered.

Perfidious ‘saviours’

Yet the possible plan for the upcoming congress – to create a third vice-president – appears not to move far beyond the cold hands of the old. Phelekezela Mphoko would be pushed to third vice-president status. Grace would be the second vice-president.

The current defence minister, Sydney Sekeramayi would be first vice-president and so, next in line for the presidential palace. He is a quiet but no less tarnished member of the Zanu-PF old guard; especially when one remembers the massacre of thousands of Ndebele people during the Gukurahundi.

When performing the calculus necessary to rectify Zimbabwe’s graceless imbalances, remember that Mnangagwa was perhaps the key architect of the nearly genocidal Gukurahundi, now chronicled in archival detail in historian Stuart Doran’s Kingdom, Power, Glory: Mugabe, Zanu, and the Quest for Supremacy. Among the scores implicated therein are the British, condemned by Hazel Cameron, another meticulous archivist, as exercising “wilful blindness” during what Robert Mugabe has dismissed as a “moment of madness”.

Perhaps it’s no surprise, then, that many are suspicious of Mnangagwa’s relationship with the UK. Many suspect he has been swimming with perfidious Albion for a very, very long time.

The ConversationThose waters, in the shadow of Mugabe’s heritage, will take a few more generations of hard political work to clear. It hardly seems propitious that a coup, and the same generation that has ruled since 1980, starts it off.

David B. Moore, Professor of Development Studies, University of Johannesburg

This article was originally published on The Conversation. Read the original article.

Zimbabwe’s financial system is living on borrowed time – and borrowed money



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An illegal money changer holds bond notes outside a bank in Zimbabwe’s capital Harare.
Reuters/Philimon Bulawayo

Roger Southall, University of the Witwatersrand

Zimbabwe’s financial system increasingly resembles a house of cards. Were one card to give way – for instance, if South Africa’s power utility, Eskom, were to have the temerity to suggest that Zimbabwe actually pay for the electricity that it’s supplying the country – the entire edifice would collapse.

To put it another way, the government is bust. It is again printing money to cover its spiralling costs, and inflation is rising. And given that there’s an election looming in 2018, Zimbabwe’s ruling party, ZANU-PF doesn’t want to cut-back. Far from it, it wants to carry on spending, as fast as it can.

The rot goes back to the early 2000’s. ZANU-PF profligacy had been fuelled by acontinuous cycle of simply printing more money, and resultant runaway inflation. Mega-inflation meant that ordinary people lost their pensions and whatever savings they had, as the Zimbabwe dollar lost its value and people resorted to barter or the use of other currencies.

Ultimately, the government faced no choice but to accept reality. In 2008 it scrapped the Zimbabwe dollar in favour of a basket of other currencies, although within a short time, this meant in effect the reign of the US dollar.

“Dollarisation” allowed for the pursuit of more rational policies by the coalition Government of National Unity which followed the disputed 2008 election. However, its control of the electoral machinery ensured that ZANU-PF won a resounding victory in the 2013 election. Within a short space of time it returned to its familiar policy mix of profligacy, corruption and populist economics.

Yet ZANU-PF faced major problems. Above all, “dollarisation” meant that the cost of Zimbabwe’s exports on international markets was high. Worse, the dramatic collapse in agricultural production since the early 2000s (following the appropriation of white farms) alongside the decimation of the country’s manufacturing industries meant that there was relatively little to export anyway. Tobacco production has recovered a little, but the quality is less than it used to be, so returns are relatively less.

Meanwhile government insistence that mines should be 51% Zimbabwean owned has done nothing to entice inward investment or boost exports.

In short, the capacity of the economy to earn US dollars by selling goods externally has fallen dramatically, and the supply of money circulating within the country has dried up. Unemployment stands at around 90%.

President Robert Mugabe’s latest response has been to replace finance minister Patrick Chinamasa, who had been warning of the structure’s fragility in ever more urgent tones. The new finance minister is Ignatius Chombo, a party loyalist, who will brook no talk of any need for structural reform.

The bond notes

Faced by a looming crisis, the ZANU-PF government has resorted to three key strategies.

One has been the issue of “bond notes” (of different denominations) by the Reserve Bank of Zimbabwe. Officially, they’re designed to swell the amount of money in circulation within the country. The problem is that apart from having no value outside the country, nobody trusts them as they have been issued by a ZANU-PF government, and it was this government that presided over the hyperinflation.

ZANU-PF’s announcement that it was issuing bond notes was met with a run on the banks as depositors sought to withdraw dollars as fast as they could. Their assumption was that this was a government ploy to reintroduce the Zimbabwean dollar. The Reserve Bank of Zimbabwe responded by limiting the amount of dollars individuals could withdraw.

People are reluctant to use the bond notes. But they’re still sometimes forced to accept them because of the sheer shortage of “real” money. As a result when they can, they rush off to the local bus station where they can sell them for dollars to currency traders – albeit illegally.

The second strategy has been the rapid expansion of country’s ability to manage electronic transactions. Its aim has been to expand the amount of money in circulation without using up “real” dollars.

Accordingly, government employees are now largely paid electronically Similarly, government employees (and everyone else) now pay nearly all their bills within the country electronically.

And Zimbabweans are rarely able to convert the notional sums of dollars they hold in the bank into real cash – unless they make use of the currency traders in illegal transactions.

Meanwhile, with the rate of inflation continuing to rise combined with the widespread lack of faith in the banks, many Zimbabweans spend their bank balances on consumer goods as quickly as possible rather than attempting to “save”. After all, if times get hard, you won’t be able to get rid of your bond notes, but you may be able to sell your fridge.

Fanciful financial system

But it’s the third strategy which the government has pursued which is really fuelling a fanciful financial system.

Since 2013, government expenditure has steadily increased year by year, despite the country earning very little internationally. The ZANU-PF government may have hoped to fund this by its old trick of literally printing money, that is, by expanding the supply of bond notes.

But such was the negative popular sentiment that the Reserve Bank of Zimbabwe seems to have restricted their issue. Supposedly the issue of bond notes is backed by a USD$200 loan by the Afreximbank, but no-one really knows how many have been issued because the central bank provides no information.

What the government has done instead is to fund its rising costs by issuing treasury bills (whereby the government touts for loans on the capital market against promises of later redemption). No-one in their right mind would want to buy them, but Zimbabwe’s banks today have little option. As inward investment into the country has dried up to a trickle, there is little else for them to spend their money on, and the interest rates that the government promises to pay are, at face value, attractively high.

The coalition government of national unity recorded budget surpluses for three of the four full years in which the opposition controlled the Treasury. For its part, the ZANU-PF government recorded deficits of USD$186 million and USD$125 million in 2014 and 2015. Recently, the then finance minister Chinamasa projected a deficit of USD$1.41 billion for 2017. As of June 30, 2017, there were USD$2.5 billion worth of Treasury bills on issue.

The ConversationIn other words, the spending will continue. Zimbabwe’s financial system is living on borrowed time and borrowed money. It will again end in financial ruin, as it did in 2008. But all ZANU-PF cares about is ensuring that it wins the next election and allowing its political elite to “eat”.

Roger Southall, Professor of Sociology, University of the Witwatersrand

This article was originally published on The Conversation. Read the original article.