Zimbabwe’s wasted economic potential – Eric Bloch

via Zimbabwe’s wasted economic potential December 26, 2013 Eric Bloch NewsDay

AS 2014 approaches, the thoughts of Zimbabweans are focused on the economy and expectations for 2014. This is because of the magnitude of economic woes that have prevailed for too long, with consequential extreme suffering and hardships.

The populace is desperate for a substantive economic upturn, but after 16 years of adverse conditions, is convinced that transformation is naught but wishful thinking.

Having been whipped and beaten by these economic traumas for too long, most people have convinced themselves that these circumstances are endemic and irreversible. They look forward to the future with anxiety, despondency and expectations of worsening circumstances.

However, as proven worldwide over centuries, such “doom and gloom” prognostications are devoid of substance and foundation. Never in history has any country with meaningful economic potential — that has assiduously destroyed its economic wellbeing — not ultimately achieved recovery and ultimate growth to higher levels than prevailed before the start of the economic decline. And that will undoubtedly be so for Zimbabwe, although the turnaround will not be instantaneous but gradual.

Expectations of future significant upturn cannot be founded on misplaced optimism and wishful thinking, but on recognition of innumerable relevant precedents and even moreso on awareness of the extraordinarily great resources available to Zimbabwe to fuel and maintain that economic recovery and growth. Those resources will guarantee the country the foundation to stimulate not only a return to economic viability, but also development.

In fact, Zimbabwe is bestowed with huge economic potential greater than the majority of countries in Africa. This is to such an extent that if the potential is intensively pursued, Zimbabwe’s economy could well be the fifth largest on the continent by 2020, with poverty seriously alleviated.

Among the economic zones with bright prospects are agriculture, mining, industrial manufacturing, commerce and ultimately the financial sector. Having witnessed the progressive ruining of agriculture since 1997, most are sceptical Zimbabwe can reverse the damage done to farming.

During the heyday when agriculture constituted the foundation of the nation’s wellbeing, Zimbabwe was renowned as one of Africa’s foremost agricultural producers.

It did not only produce to meet national needs, but also significant surpluses for export. The country was renowned as the “breadbasket” of the Sadc region, supplying maize, wheat, sorghum, and various other grains, as well as other crops to South Africa, Mozambique, Malawi, Zambia and many other countries. It also exported substantial quantities of other quality agricultural produce, including livestock, much of which was then destined for (and still goes to) the European Union.

Today, Zimbabwe is heavily dependent on costly imports which it cannot afford and some of which are from farmers forcibly displaced by Zimbabwe, now successfully farming in neighbouring countries.

There are five key elements which underlie the immense agricultural potential with which Zimbabwe is endowed, although also supplemented by other positive features and resources. First and foremost is the proven high fertility of much of Zimbabwe’s agricultural land. That fertility enabled very high yields of quality products.

Only 15 years ago Zimbabwe was the world’s highest producer of quality virginia tobacco, primarily for export, including extensive exports of numerous grain products, coffee, sugar, tea, citrus and livestock. The fertility which enables massive agricultural production, and which assured a strong foundation for the economy as a whole, could be restored by extensive and prolonged land rehabilitation and development.

Many people have accumulated considerable agricultural experience. They are well-versed in identifying the specific purposes for which different areas can most beneficially and productively be used. That is reinforced by the diversity of the population’s productivity.

Concurrently, restoration of a vital agricultural sector brings with it the creation of extensive employment opportunities which in turn triggers and assures substantial consumer spending, boosting commerce and industry, other economic sectors and the national exchequer.

A key element constraining the realisation of the agriculture recovery and thus economic growth is that almost all existing and intending farmers have no requisite resources and cannot access them. It is overdue for government to address this critical factor, which to some extent could by the issuance of readily negotiable and transferable long-term land leases, lawfully available as collateral.

Simultaneously, the state must remedy the water crisis and supportive irrigation, power supplies, access to markets at fair, open and viable prices. This must be linked to equitable constraints against unjust import competition (fuelled by international subsidisations and incentives). There is also a need to curb and contain corruption.

Although for many decades agriculture was Zimbabwe’s economic mainstay, and can and should be restored as the mainstay of the economy, it is only one area of the many sectors of great opportunity for development and growth. Others include mining, manufacturing, tourism and commerce.