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Eric Bloch Column

Failed measures of economic empowerment

UNTIL the late 1970s, almost all economic activity other than labour lay in the hands of the minority white population of then Rhodesia, now Zimbabwe, as a result of highly repressive laws, and equally repressive withholding of opportunity from

the country’s majority.

The Land Apportionment Act precluded any in the black population from owning land, and even usage of land was restricted.

Similarly, local authority bylaws and regulations severely restricted blacks from establishing and operating businesses, or carrying on any other commercial activities other than to be employed as labourers in white-owned businesses, on white-owned farms or as domestic servants.

It is of little wonder therefore, that a key objective of attaining national Independence was to transform the economy so as to enable active participation in it, in any and all facets as any of the population may wish for. Changing the law to make that possible was relatively easy and rapidly achieved. Racism was struck out of all legislation, and in theory the new Zimbabwe became a land of equal opportunity. In practice, that opportunity extended to very few, as most of the population had little or no wherewithal with which to fund the development of new enterprises, or with which to acquire existing businesses.

The economy remained, with a few significant exceptions, the preserve of the minority white population, the only exceptions being the privileged few who, by virtue of their political authority or connections, were able to enter the economy and, in many instances, accumulate great wealth in a remarkably short period of time.

Although there were undoubtedly those who did so legitimately and as a result of their own determined endeavours, drive and initiative, equally undoubtedly there were others who did so in less credible and less acceptable ways. But the nub of the situation has been that, after almost a quarter of a century of national Independence, economic empowerment has become a reality for a very few.

Throughout the years leading to Zimbabwean Independence, those who were to become the country’s ruling party had promised an economic Utopia to the masses, and after Independence continued to make those promises regularly, but with very little delivery.

As pressure progressively grew for government to put substance to its empty and unfulfilled assurances, it adopted two strategies. The one was to strive very vigorously to deny culpability and ascribe the blame to others, and who better to blame but those who were in the minority and therefore limited in opportunities to defend themselves, and who were in some instances those who had restricted the population’s access to economic empowerment, or were descendants of those who had done so?

Although in the post-Independence era, the whites who remained in the country were, with few exceptions, receptive to a genuinely multiracial, equal opportunity society, they were perfect scapegoats for a government which had proven itself unable to fulfil its promises to others, and yet was able to achieve very great economic empowerment for almost all of its hierarchy.

The second strategy was to expropriate from those economically empowered whites that which they had developed from their own capital and their labour and effort. The first phase of that expropriation was to acquire that
which had not only the symbolic status of national wealth, being the vast areas of agriculturally developed lands, but which was also the foundation and mainstay of the economy.
 
In practice, government resolved to steal the land, and all that was upon it, but in order to weave a fabric of legitimacy and a façade of justice, it fabricated contentions that the whites possessed of the lands had stolen them from the black populace of the country and, therefore the actions being taken were merely to restore those lands to their rightful owners.

In a fruitless attempt to resolve the lack of some of the resources, government then legislated to deprive the evicted and, in many instances, consequently impoverished, farmers of their farming equipment, irrigation infrastructures, and the like. Once again, tantamount to theft!
 
But still the economic empowerment was very limited, and more and more of the populace were looking askance at government, and at those who had clearly, but inexplicably become endowed with great wealth. That wealth was, and is, flaunted with enormous, flamboyant mansions in the most up-market suburbs, fleets of the most modern and luxurious motor vehicles, and every other conceivable luxury and symbol of wealth. The circumstances of the life of the teeming masses, on the other hand, were for most of them abysmal in the extreme. For many, the perspective had become one of continuing poverty, misery and distress, far greater in extent than at Independence.

As economic empowerment has remained a hoped for mirage for most, government must resort yet again to legalised theft from those that have, notwithstanding that the dilution upon transfer to the have-nots results in the disempowerment of the economy, rather than the economic empowerment of the majority.

The Robin Hood act of stealing from the rich is not enriching the poor,but is merely adding the formerly rich to the ranks of the poor, and to the further impovishment of the nation.

Thus, when the president opened parliament a few months ago, he stated that actions would be taken
to transfer 51% of all mining ventures to blacks (although subsequently the targeted disinvestments of present mining investors was stated to be 20%).

Then only two weeks ago, government stated an intent that no less than 51% of all companies in Zimbabwe must be “indigenised”. Clearly government is unwilling to learn from experience, and is determined to pursue its unrelenting chosen path of denuding whites of what they legitimately own, theoretically in order to benefit the black population, but in practice to enrich a few and impoverish more. It has yet to legislate its stated intents against mining and other companies, but will surely do so. In the meantime, it has brought into being equally draconian legislation by abusing the Presidential Powers vested by the constitution, intended to be used in circumstances of emergency and crisis.

Using those powers (which, for six months circumvent parliament, which is intended to be a democratic legislature — although that too is sometimes in doubt), Statutory Instruments 187 and 218 of 2004 have been gazetted. Those Statutory Instruments override the very comprehensive provisions of the Companies Act intended to protect shareholders, creditors and other stakeholders of companies unable to pay their debts, and the like provisions of the Insolvency Act.
 
Instead, in any instance in which a company may be unable, for whatsoever reason, to repay any amount due for a loan or like credit advanced by a state enterprise (such as the Reserve Bank), whether that inability is due to fraud, mismanagement or any other circumstance whatsoever, the state can effectively take over the company, and restructure its ownership, as it thinks fit. So authoritarian is this legislation that the company and its stakeholders cannot even appeal to the courts, any appeal being determined by the very arms of government as implement the legislation.

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