The best way to measure the strength of a country’s economy is to do so when that nation is under stress.
Has the government made provision for a rainy day? Is the country’s currency in a position to stand up against the other main players around the world or will you need wheelbarrows of cash to pay for an essential item?
These are some of the questions that have been asked of nations affected by drought – including Zimbabwe,
Until around 2000, Zimbabwe was known as the Breadbasket of Africa – exporting wheat, tobacco, and maize.
However today, the country is a net importer of foodstuffs with many battling to feed themselves.
Zimbabwe had a strong agricultural sector until the ruling Zanu PF turned on white farmers, expropriating their land and turning it over to so-called emerging farmers – many with political connections. A defiant then President Robert Mugabe shook his fist in the air, happy to see the back of what he called, the colonialists. Party loyalists were rewarded and his power secured. But as a result, this once thriving country saw productivity plummet and farms fall into ruin.
White farmers – sometimes leaving only with what they could carry – left for other destinations including South Africa, Mozambique and Zambia, taking their valuable skills with them. And this hit the country hard – very hard.
Transformation is important and looking at the history of Zimbabwe, change was still needed. But there was little to no transfer of skills. Just a classic case of biting the hand that feeds the nation. The next two decades saw the political opposition being obliterated with detentions and violence as Mugabe’s desperate grip on power intensified.
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He was choking the nation – many went hungry. But Mugabe finally stepped down from power in 2017 – and passed away two years later. His vice-President Emmerson Mnangagwa took over, promising change.
However, the damage was done. Millions were still hungry, the Zim Dollar was worthless and the word “Zimbabwe” had become synonymous with failure. Fast-forward to 2024 – where are we now? Zimbabwe’s new currency – the ZiG – has now begun trading. Reserve Bank Governor John Mushayavanhu set the introductory exchange rate of 13.56 per US dollar for the ZiG, short for Zimbabwe Gold.
The daily exchange rate will be determined in the interbank market from now on. Bank balances were transferred into the new currency with their customers given 21 days to do so, and the new banknotes will enter circulation at the end of this month (April). But this is the latest effort to jump-start a local currency. The RTGS, also known as the Zimdollar, was launched in 2019 after a decade of dollarisation, which included so-called bond coins and bond notes, The Zimdollar struggled to gain trust and its slide pushed annual inflation above 55% in March, raising fears of a return to the 2007-2009 era of hyperinflation under Mugabe
The Zimbabwean government is now pleading with other nations to give the country a chance.
However, this may be too little, too late – as there is a new crisis. Zimbabwe has declared a national disaster over a drought caused by the climate event known as El Niño and President Mnangagwa says the country needs $2bn in aid to help millions of people who are going hungry. He says that due to poor rains, more than 2.7 million people will not have enough food to put on their tables this year.
The President says this season’s grain harvest is expected to bring in just over half of the cereals needed to feed the nation. There is little in reserve to pay for aid and the government, which has hated the West due to targeted sanctions, has launched a general appeal. So, while many face starvation, there is mounting criticism and anger over how the country has been managed over the past 24 years. Many will agree that a general lack of democratic reform leaves the country in a dire situation.Ask the millions of Zimbabweans who have fled to South Africa for work or safety – they will tell you.Zimbabwe – once known as the breadbasket of Africa – remains one of the biggest tragedies in the world.
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