Zimbabwe President to Move Toward Nationalizing Foreign Firms
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MARTIN GEISSLER, ITV News Correspondent: Daybreak in the townships of Harare, and the desperate struggle to survive begins. The lucky ones with jobs walk for hours to get there. The bus fare these days would cost more than they earn.
We traveled back into Zimbabwe to see firsthand the extent of the country’s economic meltdown. It was even more depressing than we’d feared. As soon as you get back across the border. Everybody really wants money. I mean, you can understand why, because the currency here is so crippled, prices increase over the course of a single day.
One item will cost much more in the evening than it did in the morning. And by the end of the week, it could have gone up two, three, four, five times in price. That’s why they’re so desperate to get their hands on foreign exchange. In fact, they’ve resorted in many places to bartering. It’s the only way to keep hold of the value of something, is to buy it, and then trade it on, like for like.
MARTIN GEISSLER: Many people here are losing the struggle to survive. This is Caroline. She has five children to support but nothing left to give them. The infrastructure here is crippled. The queues for petrol stretch miles. They’re lining up in hope rather than expectation.
Even more alarming is the lack of food. These pictures were filmed by our hidden cameras in a supermarket. The shelves where you’d normally find the staple supplies are empty, no bread, no milk, no meat, no maize meal. What’s left is unaffordable. This tin of chopped ham would cost a factory worker more than a week’s pay. That’s how far this economy has sunk.
ZIMBABWEAN CITIZEN: These guys have failed, and they really should go. Otherwise, we’re all going to die in this country.
MARTIN GEISSLER: The Mugabe government’s solution to this: force all stores to half their prices, sell their goods at a loss. It’s the economics of desperation, but it’s being rigidly enforced. The menacing presence of this regime is never far away.
The black market is now the only place to find many essentials, but even the illegal traders we filmed were running out of stock.
The American ambassador to Zimbabwe said recently the government here is committing regime change on its own, basically making it impossible for the Zimbabwean people to do anything but rise up and get rid of him. And yet, less than a decade ago, this country had one of the strongest economies in Africa. These days, like so much of what you see here, that seems almost impossible to believe.
JIM LEHRER: And to Ray Suarez.
Enforcing Price Controls
RAY SUAREZ: Today, President Mugabe confirmed that price controls would continue. For more, we go to Akwe Amosu, senior policy analyst for Africa at the Open Society Institute in Washington. She's written and reported widely on African issues for over 20 years.
And Jeffrey Herbst, provost and professor of political science at Miami University in Ohio, he taught at the University of Zimbabwe in Harare during the late 1980s, a time of relative prosperity in the country.
And, Professor, today Robert Mugabe presided over the ceremonial opening of parliament. He didn't have a lot to say about the economic problems, but he did concede that they did exist. He promised to cut and continue to freeze prices but didn't talk about why a country that once was a net exporter of food has bare shelves. Why?
JEFFREY HERBST, Miami University in Ohio: That's correct. Instead, he tried to blame Zimbabwe's economic problems on foreigners, as he has done for a good part of the past decade. He knows if he would concentrate too much on the country's economic problems that the blame would rebound only on him.
RAY SUAREZ: Akwe Amosu, they have confirmed that this current price regime is going to continue. How does a country with roughly 10 million people in it enforce something like store-level pricing, shelf-level pricing?
AKWE AMOSU, Senior Policy Analyst, Open Society Institute: Well, it uses its military muscles, its security forces to go out there and enforce the prices that it thinks are appropriate. And I think we've seen something like 4,000 retailers and members of the private sector, manufacturers, who are perceived by the regime to have been responsible for raising prices illegitimately being detained and being given fines and punishment for that "crime," so-called.
RAY SUAREZ: But when you've got inflation running in the thousands of percent, are there people who are just shutting their gates rather than selling at less than they paid for the goods?
AKWE AMOSU: Yes, I mean, obviously, until now, the retailers have been trying to keep pace so that they have to pay more and more for their goods, and then they charge more and more in their shops, but when they are told, "You have to cut those prices by 50 percent," then how they are supposed to go and restock is anybody's guess. And, in fact, as you say, as we saw in that report, several of the shelves in these shops are empty because they cannot restock. They can't afford to do so.
Defining Zimbabwe's enemies
RAY SUAREZ: Professor, you mentioned that the prime minister has blamed Britain in particular and the West in general for Zimbabwe's continuing economic problems, but does he ever go into further detail than that? What exactly are the people he describes as his enemies doing to the country to make things so bad there?
JEFFREY HERBST: Well, Robert Mugabe has repeatedly blamed Tony Blair, and the United Kingdom in particular, for the very mild sanctions that Western countries have imposed on the country. In fact, those sanctions have played really no role in the country's self-destruction.
RAY SUAREZ: So this is just a rationalization, in your view?
JEFFREY HERBST: It's a rationalization, but a good part of Zimbabwe's conflict and self-destruction is racially motivated, Robert Mugabe attempting, now succeeding, in destroying the white agrarian class. And the code for foreign powers in Zimbabwe is also the white Western world, which he believes is trying to keep him from completing what he sees as the Zimbabwean revolution.
RAY SUAREZ: Akwe Amosu, does that go down any longer now that farmers, as the professor mentioned, have been pretty much put out of business, the white industrialists are all but gone, and the small white population has dwindled almost to nothing? Can you really blame whites in Zimbabwe for what's going on? Are people looking inward and saying, "Who's doing this to us"?
AKWE AMOSU: There has always been, all the way through this period, there has been an active and articulate opposition that has clearly stated that it believed the problems to start in the government. And if you look back over the years, you'll see that the ZANU-PF government, Robert Mugabe's government, has consistently applied policies to try and silence those critics.
So I wouldn't say it's true to say that people have been completely hoodwinked by this attempt to paint the outside world, the Western imperialists, as the sole party responsible for Zimbabwe's problems. There's always been a clear and strong critique coming from inside the country. And that's why you saw, for example, the clearing of hundreds of thousands of people who lived in the urban areas out of those areas, sent into the rural areas, because they had been voting for the opposition, and President Mugabe didn't want that to happen anymore.
RAY SUAREZ: But is there a point where you sort of cross this threshold, where he has too many internal enemies and it becomes harder and harder to remain in control in a country like this?
AKWE AMOSU: I think you go back and look at the security forces. The government has been extremely savvy and smart about making sure that security forces, the police, the military, the youth militias whom he's recruited have been always paid a little bit more and looked after a little bit better than the rest of the population. And that matters in today's Zimbabwe a great deal. And, therefore, he has had a cadre of people who are willing to enforce his will.
We are looking at 5,000 percent inflation and pretty much an economic implosion in Zimbabwe. It is an open question how long he can go on rewarding those people to do his bidding and assert his will. And I think, after that, what do you postulate as the real possibility that he won't have that support anymore?
RAY SUAREZ: Professor, is some of the support for Robert Mugabe coming from the neighbors? Do they aid him in remaining in power in Harare?
JEFFREY HERBST: I don't think they directly aid him; neither, however, have they been particularly strong in opposing him. The neighbors have been at times bewildered about what to do about Zimbabwe. They also resent foreign criticism of an African country, even if they hardly have sympathy with Zimbabwe.
And, also, some leaders and some of the populations in southern Africa, especially in South Africa, have some sympathy for what Mugabe has done to the white agrarian class in particular, even though they would not want similar actions taken in their own country.
RAY SUAREZ: Are they able to withstand the flow of hundreds of thousands of refugees out of Zimbabwe? These are often some very poor countries bordering Zimbabwe.
JEFFREY HERBST: There are certainly probably between two and three million Zimbabweans in South Africa, many of them desperately poor, although there has also been an exodus of very highly trained accountants, actuarial school teachers, and many others who form the basis of the Zimbabwean economy to South Africa. The neighbors have suffered, but it is also something which they've been able to tolerate.
Resolving the conflict
RAY SUAREZ: And do you see some endgame, Professor? Is there a point at which this continuing suffering of a very large number of people, the emptying out of certain portions of the country just becomes untenable?
JEFFREY HERBST: Not necessarily. It's important to note that the Zimbabwean economy is falling apart. However, precisely because of the distortions in the economy, some people closely allied with the regime are making a lot of money. And they are being rewarded, as are the police and the military.
We've seen in Africa that dictatorships that run their economies down can sometimes go on and on and on far longer than we would have suspect. Mobutu in former Zaire, for instance, was widely thought that, for almost 20 years, that he had six months left in power. These things are very hard to predict, but we've seen quite often that leaders who have very poor economies, if they control the security forces, can manage to stay in power.
RAY SUAREZ: Akwe Amosu, do you agree?
AKWE AMOSU: Yes, I think Professor Herbst is right that that is a real possibility if nothing is done. I think we do have a small grain of hope that leaders in the southern African region will be motivated finally to take some stronger action. We saw the foreign minister in South Africa recently saying SADC needed to take a hand on this economic issue. I think there's a lot of impatience in Johannesburg.
RAY SUAREZ: SADC, tell people what SADC is.
AKWE AMOSU: I beg your pardon, the Southern African Development Community, which is the community of nations in that region who are theoretically seized of this issue. They have started a mediation process, which is being convened by President Mbeki of South Africa.
That's not going very fast. In fact, I'm told it's stalled, largely because of intransigence on the side of Robert Mugabe. And I think we have a summit meeting early next month of the leaders in the region.
And, certainly, some months ago, when the Zambian president was talking about the situation in Zimbabwe, he intimated pretty clearly that, if there was no movement through this effort to handle, as it were, the situation with kid gloves, and if they did not manage to pull it around, then he would be looking to take some stronger action.
You saw Kofi Annan, the former U.N. secretary-general, yesterday describing the situation in Zimbabwe as "unsustainable" and calling on Africans to take responsibility for solving that problem. I think we may see -- I think we may hope to see some kind of action coming out of African countries, and that could avoid the unhappy fate that Professor Herbst has just described.
RAY SUAREZ: Akwe Amosu, Jeffrey Herbst, guests, thank you both.
JEFFREY HERBST: Thank you.
AKWE AMOSU: Thank you.