A misty autumn morning
It’s been a strange rainy season. The rain has finally petered out and the mornings are crisp (9 degrees in the photo) but the clear April skies have yet to appear. Of course, here in Zimbabwe, we don’t get the autumn colours of the higher latitudes – we have a sub-tropical climate and what colours there are appear with the new leaves in spring.
The rains arrived pretty much on time in the middle of November and then we had 2 very dry months in December and January. The maize in the foreground of the photo above was starting to look stressed and the general manager of ART Farm where the photo was taken was getting distinctly stressed about the state of the soy beans. Then in February the rains came back with a vengeance and by the end we’d had an almost normal quantity. Distribution is important too and because of the prolonged dry spell yields will not be fantastic. Some parts of the country got excessive rain and others did not plant maize at all.
The economy continues to stagnate. This is not that surprising as it is after all broken and broken economies are not quickly fixed. In the case of Zimbabwe we, and presumably potential investors, are waiting for the general elections the date of which still has to be determined. If the elections are deemed to be free and fair then the money will come. We hope.
The elections have to happen before September. I don’t watch television much and local television not at all but even I have noticed a dearth of campaigning by the parties concerned. The opposition MDC alliance (the original MDC became hopelessly divided but they seemed to have cobbled together an agreement to stand as a single party) have been holding rallies which apparently have been well attended but the governing ZANU-PF don’t seem to be doing anything. This has made people very suspicious. Either they are super confident that they don’t need to campaign or they are “up to something”. Their track record favors the latter. Newspapers have reported that the military have been dispersed to the rural areas to do the campaigning but nobody actually seems to have evidence of this.
Mary Chiwenga, the wife of the ex-general and now vice president who was key in deposing Robert Mugabe last November, has been reported as helping herself to a government owned farm recently. This seems at odds with the “new dispensation” of president Emmerson Mnangagwa who has promised compensation to commercial farmers evicted under the Mugabe regime and has appealed for the self-same farmers to come back and help rebuild the economy. This may not sit well with prospective investors who shied away for just this reason; a lack of property rights. The story has faded quickly from the local papers who have a notoriously short attention span. When I told my foreman of this latest land grab he commented that this was a “problem with older men who take younger wives that they cannot control” – a clear reference to the profligate land grabbing antics of former president Robert Mugabe’s wife, Grace.
Yesterday was a public holiday – the holiest of holy – Independence Day. In the past crowds would be bussed, sometimes under duress, into the National Sports Stadium to hear then president Robert Mugabe drone on about perceived injustices the rest of the world was inflicting on us. Sanctions was a favorite culprit for the economic mayhem he’d wreaked even though everyone knew they were targeted sanctions against ruling party (mainly) individuals. The crowd had mainly come for the high profile soccer match afterwards.
Sometimes there was a military display and fly-past by the air force. The jets used to practice their run over my workplace but this year they were absent and I’m not even sure there was any sort of celebration at the National Stadium. This did not stop the local branch of ZANU-PF asking me for a donation for their regional party. In the past there had always been an implicit threat that if I didn’t cough up there might be a consequence – farmers have long been a soft target. It says a bit for the changing political atmosphere that this year I turned them down when phoned with “not this year, I have too many financial problems to deal with”. True enough if a bit overstated; it’s been the worst first 3 months of a year for business since we adopted the US dollar as our currency back in February 2009.
We are so used to hearing about the dire state of our economy that I am often mildly surprised to hear about agricultural enterprises that are doing well. Avocados and macadamias are riding their healthy food status wave and those who can are exporting to a near insatiable Chinese market to the extent that macadamia nuts are nearly impossible to find locally. Another horticultural company that I’ve dealt with in the past exports canned cherry peppers in bulk containers and I know an export agent who is concerned about the vast area of blueberries that will come online in 5 years or so – he told me that we lack the infrastructure to export them!
Export markets are highly sort after as the foreign currency earned can be used to import goods. Unless one has a priority requirement such as medical, seed or some other “essential” service it is nearly impossible to import using local currency. A way around this is to purchase the US dollars cash on the market, take it to the bank who will then effect the importation. This is what I did last year to import the coir pith we use in the nursery as a growing medium. I paid a 40% premium at the time – apparently it is now 50% – and landed the product cheaper from India than I can buy the local equivalent the quality of which I don’t trust.
Medical cannabis is also being grown but is very much a closed market. An email call to someone in the know got me a curt “I’ll contact you when the way forward is clear” reply. I guess I’ll just have to keep looking.
Zimbabwe Absurdity 
Waiting to see – as we usually do
26 07 2018Heading towards the worst month in the nursery since 2009. Will it change after the election?
We’ve done a lot of waiting and seeing in Zimbabwe but this is arguable the most crucial one. There’s a general and presidential election on the 30th of this month and the outcome really will define the foreseeable future of the country.
After a slow start the campaign for all concerned has got into high gear. Trees, lampposts and walls everywhere are festooned with posters for the hopefuls – and there are many of them. Not surprisingly politics is seen as the path to easy wealth and everyone wants a share. By far the most expensive campaign has been by the incumbent party (ZANU-PF) and the current president E.D. Mnangagwa who is usually just known as ED. His visage is on billboards throughout Harare often with the slogan “Zimbabwe is open for business”. Indeed, he has been saying all the right things that might interest investors including scrapping the 51% indigenous ownership of foreign based companies, compensation for commercial farmers (mainly white) who were kicked off their farms by the Mugabe regime and a free and fair election. Anyone is welcome to come and observe the elections and indeed on Wednesday I saw an EU observer team vehicle parked in town. ED has come across so far as supremely confident that he and his party will win the election without any obvious subterfuge. The key word of course is obvious because, as always in Zimbabwe, all is not as it seems.
The Zimbabwe Electoral Commission (ZEC) which is responsible for organizing all aspects of the election is most certainly partisan to the ruling ZANU-PF. Among their transgressions have been not releasing an electronic voters’ roll to the opposition parties, not listing presidential candidates in alphabetical order (ED’s name and photo is top thus biasing his chances), making the voting form a double sheet of paper (it should be single) and saying they are not answerable to anyone. The head of the ZEC has also been photographed wearing ED’s trademark Zimbabwe colours scarf and wouldn’t say when the photo was taken. Ghost voters abound on the roll some of whom are evidently the oldest people in the world. Whilst the bio-metric voters roll was put together in a rush and errors were bound to crop up people are wondering if they will be corrected in time for the poll.
The most credible opposition is the MDC Alliance. Once the MDC (Movement for Democratic Change) was a single party but I have lost count of how many factions there now are. For the moment they seem to have patched over their differences and their presidential candidate is one Nelson Chamisa who has impressed me not at all so far. He seems prone to making silly campaign promises such as a high speed train that will link the capital Harare and Bulawayo the second city in the south of the country. Given that is 450km that will make it the fastest train in the world. That aside he has been touring the country and if the pictures are to be believed the stadiums have been packed. The colour of choice for the MDC Alliance is red which does rather remind me of the EFF (Economic Freedom Fighters) party in South Africa which is known for it’s extreme views on taking land without compensation. It’s headed by the firebrand Julius Malema who has a very thin grasp of economics and models himself on the late Hugo Chavez. I hope that the colour is the only thing in common between the MDC and the EFF.
What I have not heard from any political party is any coherent policy to alleviate the critical cash shortage. The head of the central bank has stated that after the election he will flood the country with US dollars to put the black market traders out of business. Quite where the money will come from has not been stated.
The currency black market is flourishing at a level reminiscent of the Zimbabwe dollar days. My friend Shelton, who is also my French teacher, tells me that the currency traders are openly trading in the centre of Harare (he also tells me that the marijuana dealers are also trading openly but that’s another story). There are several rates depending on what is being traded. Bank transfers for US cash commands about 1.8 or more to US$1 cash. Bond notes, the Zimbabwe equivalent to a US dollar but only valid in the country, trade at about 1.6 or 1.7 to US$1 cash. Mobile banking on a cell phone is about the same as a bank transfer. Apparently there is no shortage of of either type of cash which is curious given that it is vanishingly rare in the shops and banks.
About 2 weeks ago a rumour did the rounds suggesting that the central bank was going to start issuing Zimbabwe dollars again. This started panic buying of US dollars cash and the rate, which had been stable for about 8 months, started to run. I wouldn’t be surprised if the rumour was started by those with the cash (both types), who are known to be the political fat cats, to force a run on the rates before the election.
All my accounts, both company and personal, are in US dollars – it says so very clearly at the top. We all know that they are not US dollars as we cannot go to the banks and get any and the “street rate” is fast closing on 1:2. This is going to pose a major problem for whoever wins the election. Zimbabwe imports a lot of goods, mostly from South Africa, and prices have gone up because those who are doing the importing are doing so at inflated rates. I bought a sheet of plywood this week to put in some extra cupboards at the office and it had more than doubled in a year. I paid by debit card so that would go into the seller’s bank account and immediately be registered as US dollars. Assuming that we do revert to “real” US dollars after the election those who have been charging at the street rates stand to have made a lot of money. I deal in seedlings and when the rates started to run towards the end of last year tried to put up my prices. My customers raised merry hell and I had to bring them down again or risk losing customers. That they put up with increasing prices elsewhere for chemicals, hardware and general cost of living didn’t seem to bother them as odd.
The public’s mistrust of the banks and the banking system is profound so that any cash released into the banking system will soon be mopped up by withdrawals that most certainly will not be redeposited and we’ll end up with a cash shortage of the type we’re experiencing now. I don’t see how this can be solved in the short term. The nation has made significant progress towards becoming “cashless” – payments are made using debit cards and a number of mobile phone platforms. As a result I have little need for cash but I would like to have the choice of using it if I want to.
As I write this the election campaigns are running furiously. The incumbent president, ED Mnangagwa, has gone so far as to woo the white electorate with a purpose-designed rally at Borrowdale racecourse in Harare. He must be feeling a bit nervous to go to that effort; there are very few whites left in the country and their vote is all but inconsequential. I predict a close result. Quite what the military, who were instrumental in removing Mugabe from power and installing ED will do if the opposition wins remains to be seen. Will they throw their lot in with the MDC and Nelson Chamisa? They must be only too aware that should the MDC win they and others in ZANU-PF may well be held accountable for their sins in violent election fixing in past elections. As usual, we will wait and see.
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Tags: ED Mnangagwa, general election, MDC, Nelson Chamisa, ZANU-PF
Categories : News & Various, Social commentary