Financial Miracles in ZANU (PF) ’ s 2013 Election Manifesto

Abstract

The 2013 general elections in Zimbabwe were interesting. The three political parties that had formed a government of national unity following disputed 2008 elections were each campaigning for an exclusive government. The Zimbabwe African National Unity (ZANU) Patriotic Front (PF) led by Robert Gabriel Mugabe was more pronounced in its desire to lead an exclusive government. The party’s manifesto was eloquently explicit that an exclusive ZANU (PF) led government will improve the economy through indigenization, empowerment, development and creation of employment. This monograph critically review ZANU (PF)’s 2013 election manifesto to expose inherent weaknesses. It exposes the grandstanding promises which the party may never achieve given its past performance record.  

Introduction

In most developing countries election manifestos are used to hoodwink the general public by making unattainable political-economic promises. The general public is equally to blame as it does not invest time to scrutinize the manifestos. Again in most of these countries illiteracy is still an issue that divides the countries in a bipolar. Those that are illiterate depend on the correct interpretations by the literate if ever that happens. In most cases election decisions by illiterate citizens are based on following the crowd, sentiment, historical values, unsubstantiated threats and grandstanding rhetoric statements. In countries where illiterate rates are high and form the population majority you find a disturbing and seriously risky situation where the less informed with little political-economic knowledge and vested interests decide on the political leadership of the country.

Zimbabwe African National Unity (ZANU) Patriotic Front (PF) is a political party that has delivered independence to the country in 1980 led by Robert Gabriel Mugabe. ZANU (PF) and Mugabe have remained in power for the past thirty three years. Over these years the country has gone through mixed political and economic progress. Mugabe presided over the civil strife in the early to the late 1980s, economic structural adjustment programmes of the 1990s and the freefall of the economy thereafter, the unplanned and often violent land reform of the 2000s and the indigenization of the economy starting in the late 2000s. Mugabe has only triumphed on the political front and managed to retain power but failed in all the economic programmes that he implemented.

The paper thoroughly analyses the manifesto that was proffered by ZANU PF during the 2013 elections in Zimbabwe. It exposes the weaknesses of the campaign manifesto and demonstrates how it will affect specific areas of the economy. A conclusion is then drawn from the analysis. 

Analysis of ZANU (PF) Manifesto

This section dissects the ZANU (PF)’s 2013 general election manifesto. It provides a fair view and account. It also highlights certain claims and deliverables that the study found questionable. Without analysis of this kind, it is advisable for the electorate to invest time in scrutinizing manifestos or for the civil society to help the general public interpret for decision making. ZANU (PF)’s election manifesto suffers from an idea bankruptcy and is selling voodoo based economics. The manifesto is glittered with monumental but unattainable deliverables specifically designed for lazy readers. ZANU PF does not have capacity to deliver what it promised in its 2013 manifesto. The manifesto is sprout of dysfunctional financial imagination that will cripple the stable economic environment that had been proffered by the government of national unity. An exclusive ZANU (PF) led government will derail progress in the financial markets, international relations, productivity levels and drive the entire economy to ground zero.

The 108 paged manifesto may look voluminous and intimidating yet its contents are nothing but the usual yesteryear rhetoric. In order to concur with this analysis, one needs to read the manifesto in order to gain the insight of emptiness that ZANU (PF) has evolved in recent times. Everything is manipulated, the first meaninglessness is identified in the dubious misuse of the word “unlock value” without providing the mechanics of how to unlock the value. Secondly, the party says it will generate approximately $2 trillion United States dollars within the five years of ZANU PF exclusive rule through “unlocking value” form “idle assets” in the custody of parastatals and local authorities; indigenization of foreign-owned companies as well as the extraction of mineral resources. Surely how can a party that presided over a free fall economy over thirty three years create $2 trillion United States dollars in five years? By every means, this is a clear indication of desperation for power because the height is never meant to be attained but a convenient lie to give the party the mandate to rule.

The biggest misgiving is in the realization that the biggest contributor to the US$2 trillion is the extraction of mineral reserves ($1 844 223 157 000) which minerals were there since 1980 and there is no good reason why such a life changing value was not exploited over the past 33 years to give poor people a better life under unchallenged exclusive ZANU PF rule then. The naked truth is that such extravagant grandstanding promises based on unauthenticated access to classified information could have worked in 1980 than today. If the mineral quantification is an honest figure then the electorate that is reeling in extreme poverty whilst ZANU PF was sitting on such value without unlocking it for the past 33 years should never entrust it with the management of such resources. Why did the party take the people to extreme poverty without extracting that value when it had more international friends than now? What should make the electorate feel ZANU PF will extract the minerals or make them extracted and put to good use worse off when the party has militarized the extraction of diamonds which are diverted outside country managed accounts? Reading such naked hogwash between the lines of ZANU (PF)’s peddled lies brings questions about the electorate’s ability to simulate information and act upon it. The extant deception can only be made to a peasantry electorate that never lived in the 21^st century. For a 21^st century generation, serious with its purpose and future to be deceived to such a melodramatic proportion points to a conclusion of hopelessness, surrender and inability to effectively decide.

The utmost redundancy of ZANU (PF) is eminently evident in its claim that it will unlock US$7,3 billion from indigenization of 1, 138 foreign-owned companies to capacitate perennial conduits of ZANU (PF) corruption such as Infrastructure Development Bank of Zimbabwe (IDBZ), Agribank and Small Enterprise Development Corporation (Sedco). What is more sinister however is the total failure to understand basic economics by ZANU (PF) leadership. Ownership of a company does not immediately translate into liquidity or dividend share. All Zimbabwean companies irregardless of background or ownership are struggling and illiquid because of ZANU (PF) misrule. One then wonder where the unlocked value would come from. Again looking at the macroeconomics, the valuation of $7.3 billion is hoodwinking the electorate because Zimbabwe’s gross domestic product stands at approximately US$6 billion including well performing indigenous companies which makes the valuation a fraught of mischief, a tenet of ZANU (PF)’s leadership. Their unashamed lies go further to expose ZANU (PF)’s voodoo finance that the USD7.3 billion will be spun fourfold within five years to USD$29.2 billion. What one must critically think of here is to look at the opposite side of the transaction. Who on this earth is prepared to fund a risk illiquid asset such as unlisted expropriated shares of foreign-owned companies? Let’s agree for a moment that it can happen but if those shares are to be maintained in the ownership of the indigenous Zimbabweans, who amongst Zimbabwe’s ordinary black citizenry has such amounts of money?

The party is silent on spinning the full $2 trillion for reasons that it will expose their financial insanity. What is however evidently clear is the voodoo financial promises typical of desperation. Other surprises are what ZANU (PF) terms “idle assets” with parastatals ($7 681 078 582) and local authorities ($1 357 010 326). What actually raises eyebrows is the fact that the party acknowledge idleness of the assets when parastatals and local authorities under ZANU (PF) ministers are dismally performing given such a whooping leverage to liquid assets.

Towards the end of the manifesto, ZANU (PF) bemoans the burgeoning external debt of $10 billion which is mainly blamed on the inherited $700 million from the Ian Smith government. ZANU (PF) goes to the extreme of hinting a possible default on the debt which would throw financial markets into disequilibrium and cut all external funding that is oiling the economy. The reason why the debt issue was mentioned towards the end of the document is based on treachery belief that the reader has no memory and would not be able to make logic judgement. The logical judgement is that $10 billion is a mere 0.5% nanofraction of $2 trillion that ZANU PF claims that it will create in the next five years. Given that scenario, it should be the easiest task for such a successful governing party to extinguish the loan and open more productive lines of credit. There is a mismatch in what is promised to be unlocked and the disproportionate grumbling about the external loan. So readers beware! 

Then exactly $352 672 498 would be siphoned for Mugabe’s scholarship, support of chiefs, youth initiative and agricultural input support scheme to strengthen his continued unsustainable rule. The biggest problem with the presidential allocations especially scholarships is the partisan nature of their distribution which crowd-out the deserving poor who end up at local universities which lack world standard facilities. I urge the party not to mislead the people and waylay the laymen. ZANU PF is only saying what the people want to hear without the slightest sign of shame when they know they do not have capacity to deliver the promises. 

Consequences of a ZANU (PF) Exclusive Government

ZANU (PF) is peddling a manifesto which could have oversold in 1980 rather than now. Zimbabwe remain a destitute nation because ZANU (PF) has been lethargic in the implementation of pro-poor policies as evidenced by the mediocrity development of the country, underutilization and personalization by Mugabe of natural resources, low incomes by the generality of the citizenry, total neglect of the rural folks and a total abuse of power by ZANU (PF) members of parliament and ministers. The value the party claims to unlock from mineral deposits, local authority and parastatal assets have all been at their disposal in the past 33 years. One wonder if there is any good reason to believe ZANU (PF) now than in 1980?

ZANU (PF) parochially thinks that by indigenizing a foreign owned entity they can immediately queue to receive dividends and “share gross income” (page 37). The receiving mentality and the lack of basic business acumen that gross income is never up for sharing is quite evidenced by ZANU (PF)’s cadres’ strewn business failure including underutilization of prime land that they divided amongst themselves. This is the same reason why ZANU (PF) members resort to stealing and corruption to fund their lifestyles because they are not good at business.

ZANU PF’s illiquid ideas and assets it claim to unlock will hit hard the banking sector. Without a coherent international relations strategy, a condescending attitude, continued default on external debt and a battered international image, the party will not be able to draw sufficient foreign direct investment as well as open long-term lines of credit to deepen the financial markets and fund the growth of the nation. An exclusive ZANU PF government will without doubt dry up the financial markets to inextricable troughs. When we reach that stage ZANU PF becomes a monster than a partner. They can go print the Zimdollar as promised in the manifesto or try the concoction of an outlasted gold backed currency. Without a currency and liquidity, business and households will fail to service their loans, banks will dry up as they fail to service and attract external funding leading the whole financial system to crumple in total. 

Conclusion

The monograph articulated the worst mischief in the ZANU PF manifesto. There is a deliberate intention to mislead the electorate by promising unattainable promises. The deliverables that the party has set for itself are unrealistic and undeliverable given the party’s poor past performance record. The odds are against an exclusive ZANU (PF) government because of battered international relations, lack of leadership qualities, lack of prudent management of public resources, unavailability of balance of payment support and a high propensity to corruption by the party’s leaders. The party is neither prepared to stabilize nor turnaround the economy. Devoid from reality, the party’s manifesto is illiquid hence it will cripple the economy. Governments should progressively and steadily work towards improving the overall performance of the economy by utilizing the available resources rather than expecting some outlier event to spur their performance. The electorate should critically scrutinize election manifestos to expose these baseless outlier promises. Work of this nurture is encouraged to help decipher realities and fictitious election promises. The analysis of the manifesto may also result in a balanced scorecard of the governing party’s announced deliverables which can be regularly validated during the tenure of the government for performance evaluation. Such a system creates open government, political discourse and public scrutiny of government performance.

References

ZANU (PF) 2013 Manifesto

www.sokwanele.com/system/.../zanupf_election_manifesto_130705.pdf (accessed 29 June 2013)

Leadership Accessibility: A 2015 Call-to-Action

Third world leaders are the least accessible yet their followers are the most in need of leadership. Inaccessible leaders create room for inequality, corruption, classicism, nepotism, exclusion among other social ills.

This article is a call-to-action for leaders, particularly African leaders in both politics and business.

As disruptive innovation continues to bring the world closer to us, it has made it easy for common people to scrutinize leadership styles across the globe. The Internet and social media platforms have made it possible for leaders to effortlessly extend their influence out of their common environments than they could in the past millenniums. This is encouraging in a sense that proactive leaders have made themselves reachable to ordinary people bringing the possibility of checks and balances from crowdreporting, crowdmanagement or crowdadvisers for transparent service delivery, service improvement and innovation.

Leadership accessibility, in an organizational set-up, refers to the availability of a leader in the physical sense as well as being receptive to open participative discourse with their team members in order to deliver exceptional results. However a broader definition of leadership accessibility, which is the essence of this discourse, peters around the societal accessibility of leaders that can leverage and inculcate a culture of leadership grooming beyond office corridors. Leaders can make themselves available to their legion of followers by provoking them to take leadership initiatives in pertinent areas. Taking such an approach that breaks our geographical confines while seeking goodness to the well-being of society results in impacts of immeasurable proportions.

In conclusion it is paramount to highlight how the developed world leaders outpace their counterparts in leadership accessibility. Political leaders like President Barack Obama demystified access to the White House and his office; he has been available to young global entrepreneurs and has the time to connect with the grassroots in order to understand how government can serve them better. Real business moguls like Bill Gates, Richard Branson, just to mention a few, are common people on Internet and social media whom everyday people pitch to and help solve social ills.

Change comes from access.

South Africa: Blackouts, a Rare Opportunity for the Prepared

Fundamentals are weakening. The economic outlook looks certainly uncertain. No one seems to have an answer on how to stop the economic haemorrhage and generate growth. Economic growth projection for 2014/15 has been cut from 2.7% to 1.4% but with facts on the ground it could be well below 1%. Unemployment hovers at an unprecedented level of 26%. There is a developmental risk. The poor, as usual, are at the risk of being crowded-out in every aspect. 

The key drivers of this downward spiral have been cited as weak global growth coupled with internal constraints such as prolonged labour disruptions, skills shortage, administrative shortcomings (corruption), difficulties in industrial transformation and energy constraints. While I acknowledge all the internal economic logjams some are restricted to certain sectors, geography with limited economic ramifications than the incessant countrywide power outages that we began to witness in recent times. These power outages have far reaching and overarching consequences some of which will continue to be felt years after the affect. 

Well, our attitude is still of justified expectation that Eskom should provide us with power irregardless of its circumstances. It is an attitude of denial that the power utility is in deep trouble that needs time to curve out. We are still buried in the old-fashioned blame game at the expense of our future. A dependence syndrome that has to be shed out.

Smell the coffee, blackouts are here for a while if not forever. The earlier government, business and households adjust to this new reality the better. The Medupi and Kusile power generation plants are pipeline projects whose commissioning may take longer than scheduled. Any proactive risk manager would not sit on her laurels in anticipation of some unknown change which they do not have control over to improve the national power supply without taking decisive action for the good of their organization. 

We have observed many promising African states falter, most of them within our region, because of power disruptions. In comparison, South Africa has fared fairly well up to this day and may continue so when the two power stations come onboard. However, Eskom has to improve its long-range planning. Government should make conditions more lucrative for private power generators. Business and households can look for avenues to self-power.

In the middle of the situation, shrewd business managers have to look for alternative power sources while Eskom rectifies the long-term situation. Sometimes opportunities present themselves from unimagined threats. I have observed businesses in Southern Africa that turned power outages into competitive advantages through generating their own power and continue to operate during blackouts. 

Power shortage is a global problem and South Africans need to realize sooner than later that this problem is here for the long-haul. Power utilities, Eskom included, always try to give the impression that the power supply problem is short-term. If you allow this public relations trick into your business planning you are definitely planning to fail. For example, it is speculative and unguaranteed for Eskom to assert that there will be low power demand during the festive season as other economic players and households demand more than their normal power demand during this period.

A well prepared risk manager would simply ensure that he has a quick fall-back in the event that Eskom fail to keep the switch on. The business continuity intervention could take a long-term strategy perspective especially if the plan involves green-power or as a stop-gap measure till the power utility put order in its house. Government, business and households have to find sustainable ways to reduce pressure on power supply. Power generation for self-consumption is not a rare competitive advantage option in the situation we find ourselves in. It is an opportunity out of despair but can be sustainable.

Naked Rand Commitments Gobble up R350 Million off Fiscus

Maladroit financial management by the department of international relations and cooperation has cost national treasury R350 million, finance minister Nhlanhla Nene announced in his medium term budget policy statement on the 22^nd of October 2014. Surely the volatility of emerging market currencies is common knowledge and leaving a naked exposure to foreign currency denominated commitments against the Rand is ludicrous. Vote 05 is an outlier of poor currencies management that destroys value at a time when fiscus space is limited draws attention for displacing critical service delivery allocations towards vulnerable members of our society.

The global call, South Africa included, is for austerity and efficiency in the utilization of national resources. Doing more with less is a rare quality in public management and requires a 360 degree performance management approach. The finance minister has repeatedly announced in various fora of the impetus for prudent and efficient management of resources. Against such a clarion educated call one would expect surplus, or balanced budgets or in the worst case scenario leaner budget overruns with qualified and responsible justifications.

Classifying the international relations and cooperation budget overrun as unforeseeable and unavoidable expenditure is in itself deceitful. If anything was done, it seeks to justify that this is the best position they could achieve in managing the exposure to the depreciating Rand. If they took a natural hedge by doing nothing, it is a desperate cover up for gross incompetency in public resources management. In summary it is a shear attempt to run away from taking responsibility. Needless to say in both scenarios allowing R350 million to burning through your hands is an oversight of unbalanced magnitude.

In building a culture of efficiency and surpassing performance expectations, government ministries need to inculcate a philosophy of strategic cost management rather than reactionary application of cost cutting measures as evidenced by the proposed cuts by the finance minister. With forethought strategic cost management, the R350 million budget overrun resulting from the depreciation of the Rand could have been reduced or possibly eliminated.

The budget overrun is constituted of commitments in accommodation leases, foreign allowances, foreign municipality costs, educational allowances, special travel allowances and membership fees to international organizations. By and large these commitments are known in advance and fixed. They however fluctuate since they are pegged in foreign currency but can be managed. A depreciation in the Rand leads to an increase in the foreign currencies denominated commitments in Rand terms.

This undesirable position can be substantially reduced or eliminated by taking a foreign currency hedge which the national treasury or line ministry can manage. Alternatively the commitment can be tendered to a private bank or insurance company in order to shift the risk management to professionals.

In that way we can manage our international relations and cooperation foreign commitments with certainty and efficiency.