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Zimbabwe has for the past nine years been embroiled in a socio-economic and political crisis that began with the birth of an effective opposition almost 10 years ago. The birth of the Movement for Democratic Change (MDC) changed the political scene in the country in an unprecedented way. The changes in the country looked at from a political, social and economic perspective over the last eight years can be best illustrated through the following events that culminated into the Zimbabwe seen today (2009):
2000 Referendum that rejected constitutional reform;
Fast Track Land Reform Programme
2005 Operation Murambatsvina which saw destruction of homes and livelihoods
2005 Disputed presidential elections, targeted sanctions
2006 Deepening poverty, cash shortages, rising inflation,
2007 Price controls, empty shops, widening cracks in ZANU PF and MDC, Mbeki-led SADC negotiations, national women’s conference on participation in politics, Amendment 18 that made it possible to hold elections;
and development activities; opposition withdrawal, run off with Mugabe winning 85% in a disputed election, Pan African Parliament, SADC, AU election observers declare elections not free and fair;
Post-27 June widespread condemnation of Mugabe by international community; threat of UN sanctions which, although expected to move Mugabe, would have a dire effect on the poor and vulnerable people;
Negotiations between ZANU PF and MDC continuing with option for Government of National Unity or Transitional Government presided over by SADC with support from the AU, the UN.
15 September 2008 the General Political Agreement was signed between ZANU PF & MDC
2009 February- Inception of the Government of National Unity
The formation of the Government of National Unity in February of 2009 represented a step forward from the political stalemate that had paralysed the country. After nine years of economic contraction, it is believed that 2009 could be known as the year in which it all turned around for Zimbabwe. Hyperinflation has ended, a new unity government is working to rebuild the shattered economy. Much work still lie ahead and the unity government’s existence is hardly assured. While the opportunities for a complete turn around are enormous, so too are the risks. Not the least of these is a collapse of the unity government and the reversion of the old economic policies, though the current government is laying the groundwork that will make such moves increasingly difficult.
The working relationships of the parties in the inclusive government have marginally improved. Under the power sharing deal, a new constitution is a prerequisite for new elections. ZANU PF and its supporters have been stalling this process of crafting a new constitution in order to frustrate attempts to curb his wide ranging executive powers. Despite the domestic and international pressure, it is expected that the constitutional making process can become long and drawn out.
As fragile as the unity government may be, the political space has been created within which economic policies can be developed to position the country for a strong recovery in the ensuing years. Ongoing uncertainties about the government’s commitment to policies that will maintain macro-economic stability continue to discourage investment. Zimbabwe thus continues to be financially squeezed hence the implementation of cash budgeting, which is aimed at precluding the possibility of finance spending by printing money
Zimbabwe’s banking sector which had been decimated by hyperinflation, and continues to lack access to support especially from the central bank which would normally take on the role of ‘lender of last resort’. The industry on the other hand is on a recovery path, however a low savings base, mistrust of the sector, the absence of a functioning Central Bank, and banking system are all constraining current and future growth.
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