The Afro News International
Government should ease up on neo-liberal austerity measures and agree to engage in social dialogue with other social partners to boost flagging economic growth.
Expressing concern about the state of the country’s economy as government goes full throttle to fulfil its “Zimbabwe is open for business” mantra, an economist at the respected Labour and Economic Development Research Institute of Zimbabwe (LEDRIZ) has criticised the over-reliance on “ESAP-esque” neo-liberal policies that seemingly favour foreign investor capital ahead of local investors.
LEDRIZ is a member of the Africa Labour Research Network (ALRN) which brings together research institutions linked to national trade union federations and their research departments across the African continent.
Senior economist and researcher at the labour-aligned institution Dr Prosper Chitambara says: “Given the challenges of where we are coming from as a country, a stronger collective and inclusive policy approach is urgently needed, focusing on people-centred and pro-development structural policies, to strengthen sustainable economic development.”
Neo-liberal economic structural adjustment programmes (ESAPs) were adopted at the turn of the 1990s active encouragement and support from the World Bank and International Monetary Fund. However the programmes were abandoned after causing havoc in the economy as industries closed and thousands of workers retrenched and thrown into the streets.
The economy has never fully recovered and the after-shocks are still felt 25 years the experiment was abandoned.
LEDRIZ has in the past supported poverty-reduction policies and believes the country should be spending more on public social investment like health and infrastructure.
“Zimbabwe has projected a growth rate of 6%, but, argues Dr Chitambara, “this does not necessarily translate into economic development”.
“Attaining Upper Middle Income Status must not be an end in itself or an obsession. We must reduce poverty,” he says, explaining: “Economic growth cannot work alone!”
Adding support to that line of thought, the Zimbabwe Coalition on Debt and Development (ZIMCODD) says LEDRIZ are correct in advising Government just as we have been saying for a long time “increasing incentives for foreign direct investment without putting sufficient safeguards for protecting the local investors will crowd out the indigenous/local investors exposing the employees of the affected investors”.
ZIMCODD comments in relation to the need for social protection and safeguards in the face of the new economic trajectory are well-known and dovetail with those of LEDRIZ.
The Constitution fully recognizes and upholds the need to provide social protection to its citizens as articulated by Section 30, which states that … “the state must take all practical measures, within the limits of the resources available to it, to provide social security and social care to those who are in need”, says the social and economic justice coalition.
Although the statement agrees with and welcomes State interventions as necessary, ZIMCODD say “social protection interventions in Zimbabwe are not sustainable, they are politicised and tend to cover a small share of the poor”.
“Social sector expenditures need to be protected and targeted measures to deal with poverty should not be seen as ‘add-ons’ but as an integral part of the programme,” argues ZIMCODD.
“When the State becomes less accountable to the people, it feels less obliged to deliver efficient social protection services leaving the poor and marginalised more vulnerable,” the statement says.
“People-centred economic planning and budgets at national and local government levels that guarantee social and economic rights, an obligation on the state, provincial and local authorities to initiate public programmes to build schools, hospitals, houses, dams and roads and create jobs, equitable access to and distribution of national resources for the benefit of all people of Zimbabwe,” says the statement.
Ordinary Zimbabweans are sorely aware of the unfolding process of national impoverishment and are rightly or wrongly , making the links between the yesteryear horrors of ESAP neo-liberal and the current decline in service delivery.
ZIMCODD further adds that people-centred economic planning and budgets at national and local government levels that guarantee social and economic rights, an obligation on the state, provincial and local authorities to initiate public programmes to build schools, hospitals, houses, dams and roads and create jobs,” ZIMCODD underlines, emphasising: “Growth needs to be inclusive. “Partial deregulation without a restructuring of the dual economy creates social tensions and not enough jobs.”
So, wither Zimbabwe?
“A commitment to raising public investment collectively would boost demand while remaining on a fiscally sustainable path,” says LEDRIZ’s Dr Chitambara, observing: “ Zimbabwe has allowed political expediency to override economic rationality – awe should be more prudent and selective in who we court in as far as foreign direct investment is concerned.”
Investment spending on infrastructure had a high multiplier effect, with strong knock-on effects from investment projects on overall growth rates.
“Quality infrastructure would support future growth and make up for “the shortfall in investment following the loss in the last 20 years under the previous regime.
By Patrick Musira
