Zimbabwe: Mugabe’s business empire, the death of a dynasty

ZimSitRep_M

5 years ago

The once thriving businesses that were run under patronage systems under Zimbabwe’s Robert Mugabe are now crumbling.

Source: Zimbabwe: Mugabe’s business empire, the death of a dynasty

An election poster of Zimbabwe’s former President Robert Mugabe hangs on the wall near an orange field at Etheredge farm in Chegutu, April 17, 2009. REUTERS / Philimon Bulawayo

A great dynasty appears to be sinking into oblivion.

The former president, along with his widow Grace, had acquired numerous businesses over his tenure that included agricultural land, an orphanage, a children’s home and a school.

Losing its monumental glory

Since Mugabe’s ousting, and his death, Grace is reportedly failing to manage their numerous properties, with many of the farms falling into disrepair or being offered up for lease.

In Mazowe, 40km outside the capital, the Mugabes’ Gushungo Dairy Farm is now dilapidated. Its farming equipment was auctioned in 2019 to clear some debts, while other parts are being leased out.

The premises look deserted.

A security guard at the gate tells The Africa Report that the complex no longer has staff working on site due to the coronavirus pandemic, so everyone is working from home.

The person managing the farm is chief operations officer Lovemore Chiputwa, explains the security guard. However Chiputwa did not respond to questions about the operations and performance of the farm.

Community members in the small mining town tell The Africa Report that the vast Gushungo operations are crumbling.

“The road leading to the farm used to be highly secure, but now it is just like any other farm. Sometimes illegal artisanal gold miners end up encroaching into the premises,” says resident *Natsai Marindo.

Over at the Alpha Omega Dairy farm, near Harare, former employees tell The Africa Report that many of the companies owned by the former president (and related to the farm) are failing. Many employees decided to leave after not being paid. Some were laid off, while others simply resigned. That farm is now being leased.

At the Grace Mugabe Foundation – which includes schools and charity homes – the same situation has been taking place. The foundation terminated many of the employees’ contracts.

Since Robert Mugabe’s land reform policy in 2000, no individual is supposed to own more than one farm, as per the constitution [Chapter 16, section 293(2)]. But a land audit carried out by the government in 2019 revealed that Mugabe had amassed between 13 to 20 farms during his time in power. The exact figure on record is unknown due to the secrecy associated with government information, but one source says 13.

Broken promises

When President Emmerson Mnangagwa replaced Mugabe in 2017 after the military coup, the government issued a statutory instrument promising to protect Mugabe’s benefits, including land and assets.

Tendai Biti, a lawyer, former finance minister and currently an MP with the opposition party Movement for Democratic Change Alliance, says the Mnangagwa administration has failed Mugabe.

“It is such a sad story and a disgrace to humanity that an iconic leader like Mugabe has his history going down, and the Mnangagwa administration is doing nothing to protect his legacy,” Biti tells The Africa Report.

“The ruling party ZANU-PF, through Mnangagwa, have failed Mugabe. ZANU-PF has grabbed some of his farms, which are being occupied by illegal gold miners. And the government is doing nothing to protect his properties.”

Biti adds: “Dictators, when they are violently removed from power, it is evident that soon after their removal their empire starts to crumble. People fight against you, and [you are] left with no power to protect your interests. Mugabe’s empire is suffering the same fate.”

Power of patronage and incumbency

Mugabe was a beneficiary of public resources from his authoritarian government, forcing government departments, retailers, state institutions and banks to do business with him.

“There was never a business empire in the first place,” says Alex Magaisa, a political analyst and academic.

“The Mugabe businesses were being run based on patronage systems that crumbled in November 2017 when he lost his power to Mnangagwa,” adds Magaisa.

Mugabe’s businesses flourished because of his political power. When Mugabe received loans from commercial institutions, he did not pay them back while he was in office.

“Once one has left power, he is no longer in a position of influence and those creditors start calling their loans back. They want repayment and the business is saddled with huge arrears, which are a real burden on the operation of the business,” says Magaisa.

Professor Stephen Chan of the School of Oriental and African Studies (SOAS) at the University of London says: “No business empire runs by itself, but needs managerial and financial skill to sustain itself and to grow. There is no evidence of that skill in what used to be the Mugabe business empire.”

There are a number of factors plaguing the Mugabe business empire, says Prosper Chitambara, an economist. The biggest challenge is the loss of power, influence and control of the state and income streams, inputs and public resources that he used to support the businesses.

Chitambara says: “He was benefiting from the power of incumbency, now after losing power it is difficult to get the political patronage from the companies and individuals that they benefitted from. Other benefits that they got when they were in power have been relinquished, and it is [now] difficult to operate their businesses.”

From breadbasket to basket case

The Mnangagwa administration land audit launched in 2019 is still ongoing. It shows that various ZANU-PF officials and senior government officials now have multiple farms.

That land reform programme saw white-owned farms taken by Black Zimbabweans, who may not have had any farming knowledge.

The reform contributed to the collapse of Zimbabwe’s agriculture sector. It was once touted as the ‘breadbasket of Southern Africa’, and it became the ‘basket case’ of the region.

With a hungry population, international food aid became much more important.

“Ownership of farms reflects a scandal in the so-called land-reform programme, whereby the redistribution of land meant that the best commercial farming lands were given to oligarchs with strong governmental connections. Ownership does not mean agricultural productivity,” says SOAS’s Chan.

The Mugabe and land reform legacies

Mugabe’s farms falling into dilapidation are a sign of wider problems in Zimbabwe’s agriculture sector.

“It is not about Mugabe only, but the whole land reform process. There is need for an extensive land audit in accordance with the constitution and uphold the ‘one man, one farm’ policy,” says oppositionist Biti.

He adds that idling Mugabe farms should also be redistributed: “Some of the farms are too big and the beneficiaries are failing to utilise them. Others are leasing the farms to white farmers, and it defeats the purpose of democratisation of land ownership among the black population.”

*name has been changed for security reasons

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