- HARARE (AFP) - With
Zimbabwe's
economy steadily crumbling, Zimbabwean President Robert Mugabe has declared
a return to socialism that business leaders warn will only make matters
worse.
-
- The latest sign of the nation's economic downfall came
Tuesday, when the government's statistical office reported that inflation
hit a record high of 86.3 percent in September, more than 10 percentage
points above the previous month.
-
- In a bid to rein in spiralling prices, the government
last week imposed price controls on essential goods, including bread, milk
and sugar.
-
- But Mugabe took that policy even further in a speech
Monday, declaring that economic reforms backed by the International
Monetary
Fund (IMF) were "destined for some hidden bush somewhere."
-
- He warned that government would nationalize firms that
close because of the price controls, saying "they are our businesses
anyway. ... The socialism we wanted can start working."
-
- That speech and the imposition of price controls took
business leaders by surprise.
-
- "I'm not sure what he meant by what he said,"
said Jacob Dube, president of the Confederation of Zimbabwe Industries
(CZI).
-
- "Management of the national assets has been a
problem
thus far. Adding to those assets is not going to solve the problem,"
Dube said, referring to the nation's loss-making parastatals.
-
- But economists and diplomats said Mugabe's speech
reflected
the true opinions of a man who came into office 21 years ago as a
liberation
war hero steeped in Marxist-Leninist ideology.
-
- "Many economists, including myself, believe that
deep down the president believes in socialism and that he didn't see much
good in capitalist reforms," said Edmore Tobaiwa, a Zimbabwean
independent
economist.
-
- Zimbabwe's government only embarked on market reforms
in 1991 after the fall of the Soviet Union, but never managed to stick
to the Western-backed restructuring program.
-
- Consequently, the International Monetary Fund (IMF)
pulled
out in October 1999, and most other international lenders followed.
Zimbabwe
has now stopped paying its IMF debt, racking up 53 million dollars in
arrears
by late September.
-
- "You must not forget that Robert Mugabe was trained
in the Marxist-Leninist school, and that if he agreed to join the fold
of international financial institutions for a while, he never abandoned
his old dream of building up socialism in Zimbabwe," a western
diplomat
said on condition of anonymity.
-
- In a country already reeling from its worst-ever
financial
crisis, reaction to Mugabe's latest announcements has been gloomy.
-
- Bakers say the new price of bread is below their
production
costs, and have already put staffs on reduced hours.
-
- Bread, sugar, cooking oil and other basic foodstuffs
immediately became rarities on grocers' shelves, as consumers stocked up
and suppliers warned they may not be able to replenish stores'
supplies.
-
- While the government has yet to actually take over any
businesses, if Mugabe decides to move he already has the support of the
militants who have spearheaded the violent occupations of white-owned farms
since February 2000.
-
- Led by veterans of the 1970s liberation war, the
militants
have already warned shopkeepers in the second city of Bulawayo not to
resist
the new price controls.
-
- The threat to seize businesses adds to the insecurity
created by Mugabe's scheme to seize almost all the white-owned farms in
Zimbabwe.
-
- His land reforms and the farm invasions have been heavily
tied to political violence, in which perceived opponents to Mugabe have
suffered beatings, rapes, and killings.
-
- Opposition leader Morgan Tsvangirai, of the Movement
for Democratic Change, has warned that his supporters could suffer from
an escalation in the violence ahead of presidential elections due early
next year.
-
- Mugabe had agreed last month, under a
Commonwealth-brokered
deal reached in Abuja, to curb the violence, but so far has done little
to implement the deal.
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