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Bond, Patrick (2012) With corporate collaboration, Mugabe continues the political looting: Will SADC turn a blind eye this week?. Eye on Civil Society : -.

Zimbabwe’s political-economic crisis continues because neither its Government of National Unity, domestic civil society nor international pressure – including tomorrow’s Maputo meeting of the Southern African Development Community (SADC) – can dislodge old, bad habits of malgovernance. With a new draft Constitution ready for a referendum vote followed by a presidential and parliamentary election, the six months immediately ahead are critical.

Many examples of chaos appeared over the last week (much of which I spent in a rural area northwest of Harare). Leaders of Robert Mugabe’s Zimbabwe African National Union (ZANU PF) rejected crucial text within a Constitution its own negotiators had hammered out. Then Mugabe’s army threatened to derail this month’s census, desperately needed not just for socio-economic planning but also future election districting.

In a free and fair election, Movement for Democratic Change (MDC) president Morgan Tsvangirai would probably win hands down; in March 2008, he trounced Mugabe in the first round by nearly 10 percent before withdrawing from a run-off several weeks later, because meanwhile hundreds of his supporters were killed, tortured or injured by ZANU PF supporters.

As a Mail&Guardian investigation last week revealed, when Mugabe was running out of funds in April 2008, his regime was bolstered by a $100 million loan from New York-based Och-Ziff Capital Management Group, even though he had not serviced Zimbabwe’s foreign debt since 1999. The loan was possible thanks to London-based Central African Mining and Exploration Company, run by English cricket player and businessman Phil Edmonds, and AngloPlats, whose 25% gifting of assets to Harare was the basis for the deal.

Who will pay Mugabe’s campaign bill in 2013? The next greedy mining house is Anjin, a diamond mining company co-owned by Beijing investors and the Zimbabwean Ministry of Defense, whose leaders have said they will never accept rule by Tsvangirai’s party. Anjin is the main beneficiary of what is probably the world’s largest diamond field at Marange, near Mutare in eastern Zimbabwe, where hundreds of informal miners were killed by the army in November 2008.

Two weeks ago, Anjin fired 1 500 workers who, desperate for decent pay, launched their eighth strike since 2010. Farai Maguwu, a UKZN doctoral student and director of the Mutare-based Centre for Research and Development, termed Anjin’s move “a gross violation of the right of workers to engage in industrial action if their working conditions are appalling.” Another Marange diamond firm, Mbada, is chaired by Mugabe’s former helicopter pilot Robert Mhlanga, who recently purchased R185 million in properties in Sandton, Umhlanga and Zimbali.

This is the kind of company ZANU PF keeps, notwithstanding rhetoric regularly hostile to foreign capital. For the next election, probably in March, we can expect another tactic – ‘indiginisation’ – familiar to those who witnessed Mugabe’s 2000 campaign, explains Bulawayo writer Mary Ndlovu: “The indigenisation agenda ZANU PF is pushing has now replaced the land issue as a programme to simultaneously win support from a new constituency and frustrate the opposition. It seems dishonestly designed to further enrich themselves, consolidate their patronage lines and prevent the MDC getting credit for increased investment, rather than honestly redistributing wealth to the people.”

The first two corporations to play the game of diluting local holdings are platinum exporters Rio Tinto of London and Johannesburg-based Implats.

Another source of crony capitalism is the financial sector, through which disgraced Reserve Bank Governor Gideon Gono and his allies arranged foreign exchange takeovers prior to the Zimbabwe dollar’s collapse in 2009. Bankers close to ZANU PF made dubious loans which now require the kinds of bailouts that Wall Street and the City of London received from their own purchased politicians in 2008-09.

This is the main reason for Zimbabwe’s banking crisis, and recently compelled Gono to issue a directive that $100 million be kept in capital reserves to prevent a devastating run on the banks. Out of two dozen, only six or so – nearly all foreign headquartered – will survive that degree of regulatory restructuring (the rest must be merged or closed). The adverse impact on credit availability, already hampered by the world’s highest real interest rates, will be devastating.

On top of that is next month’s IMF and World Bank meeting in Washington where Zimbabwe’s nearly $11 billion in unrepayable foreign debt is up for negotiation, plus a looming public workers strike. While economic growth may still top 5% this year, the underlying crises are now being amplified. Whether a free and fair election is possible months, or instead ZANU PF uses its military might, diamond wealth and crony capitalism to maintain illegitimate power, is too difficult to call, but SADC could have its fingerprints on Zimbabwe’s corpse if once again, it turns away.

(Patrick Bond directs the UKZN Centre for Civil Society.)

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