Government selling nation ZimAsset dummy

via Government selling nation ZimAsset dummy May 13, 2014 NewsDay by Kamurai Mudzingwa

I was reading the Zimbabwe Agenda for Sustainable Economic Growth (ZimAsset) economic policy the other day and I am convinced that like many of its predecessors, it will go down the drain if the implementation environment remains the same.

It has become a norm in this country that economic policy implementation is attempted within the wrong milieu and we have seen what this has done to previous policies such as Zimbabwe Economic and Social Transformation, the Millennium Economic Recovery Programme, the Zimbabwe Economic Development Strategy and the National Economic Development Programme among others.

Judging by the comatose state of our economy, we can safely say these high-sounding policies were much ado about nothing. The major reason for the failure of these economic policies is not inherent in each one of them, but lies deeply embedded in the poor institutions that are supposed to either support or oversee their implementation.

ZimAsset will not be an exception. It is not a miracle policy that will work wonders by merely being pronounced and unleashed onto a system that is supported by rotten institutions. Research has shown the correlation between poor institutions and the failure of economic policies.

I read the following statement in ZimAsset with sadness: “In order to ensure success in the implementation of this plan, government will be re-invented to improve general administration, governance as well as performance management.”

What made me sad is the fact that the policymakers are aware that government institutions are the Achilles heel that need to be “re-invented”, but judging from events on the ground, we have not moved an inch in that direction.

And my heart was made heavier when I read this statement from the policy: “The implementation of ZimAsset will be underpinned and guided by the results-based management system.”

Results-based? Surely with the current public institutions that are patronage-based, it is one of the wildest dreams to assume that we can get anything resembling a results-based implementation system.

ZimAsset talks about “institutionalisation and mainstreaming of a results-based culture in the public sector in conformity with the results-based management system”. What we need is not mere “institutionalisation” of a results-based culture, but serious and genuine reforms of our institutions.

Our folly is that we underrate and ignore the power of institutions in directing policy success or failure. In Zimbabwe, we have seen how successful policy implementation has suffered stillbirth many a times because of this type of thinking.

Dani Rodrick, a respected guru in the area of public policy and economics, in a paper titled Institutions for Higher Quality Growth: What they Are and How to Acquire Them, notes that “a clearly delineated system of property rights, a regulatory apparatus curbing the worst forms of fraud, anti-competitive behaviour and moral hazard, a moderately cohesive society exhibiting trust and social cooperation, social and political institutions that mitigate risk and manage social conflicts, the rule of law and clean government” are social arrangements “that are conspicuous by their absence in poor countries”.

Zimbabwe is no exception.

We can clearly tell that, for instance, institutions that are supposed to ensure property rights have failed to do so. What with the indigenisation policy that threatens people’s investments and the evictions of the poor from fertile lands effected by greedy and powerful politicians.

We cannot talk of institutions that promote the rule of law for economic growth when we sanction the grabbing of other people’s properties and when corruption is entrenched in law-enforcement agencies and the judiciary.

It is obvious that we cannot talk of a “moderately cohesive society exhibiting trust and social cooperation” to achieve economic growth when we have politicised all our public institutions to promote the interests of a few political individuals through the polarisation of the people.

Rodrick talks of a clean government and it is hard to think of anything resembling something like that in this country. And the irony is that ZimAsset talks of “leveraging resources” to ensure funding for the policy’s initiatives.

We have seen how our unclean government and its inevitably unclean public institutions have badly handled the resource that was the source of our only hope—diamonds.

Our rotten public institutions allowed only a few fat cats — whom they make untouchable — the privilege to loot the national resource.

When government institutions corruptly promote anti-competitive behaviour by legalising monopoly as evidenced by the ethanol saga, we can safely kiss the idea of economic growth goodbye, ZimAsset or no ZimAsset.

And who can trust our government when institutions that should ensure economic stabilisation through sound monetary policies like the central bank raid individual and corporate accounts? Isn’t it such type of behaviour that triggers more chaos and panic than stabilisation?

It is against this background that ZimAsset is doomed to fail like its predecessors.

Our problem is that we have a government that is too preoccupied with propaganda at the expense of reality and as a result, wants to sell us the dummy that while we are moving backwards (backpedaling as it were), we should believe that we are going forward simply because we are facing the front.

But the reality is that without reforming our institutions, no economic policy will take us forward, ZimAsset included.

Blaming external forces for the weaknesses of our institutions will not help our economic cause!