Fool's Gold and ZimAsset

Gold or diamonds its all there as promised in Zimbabwe's super economy

If it sounds too good to be true-it is too good to be . The Zimbabwean government is promising economic salvation on the back of Zim Asset. Zim Asset reminds old Zimbabweans of the early 1900s, history surely does repeat itself.

In those olden days, The Chartered Company, or  British South Africa And Company (BSAC), promised everyone Zimbabwe had very large deposits of easily accessible, high quality gold. By 1920, it became obvious Zimbabwe did not have this promised gold. The Chartered Company had over-promised and to preserve its investments BSAC had to move heaven and earth to create a 'bread basket' of Southern Africa.

The so called mineral holdings backing Zim Asset, like the mythical King Solomon's mines also supposedly located in Zimbabwe, do not exist in the promised quantity and quality. Zim Asset is a dream built on the myth of 'mineral wealth'. Such fool's gold economics will not deliver development. As demonstrated in the 1920's, no amount of mineral marketing can save a poorly designed economic strategy.

Promising Zimbabwe Economic Budget

Zimbabwe's budget looks promising. It remains the only credible economic planning tool: as it changes tariffs and indicates sectors of the economy favoured for growth by the state. This budget is linked to Zim Asset and takes some stakeholder views into consideration.

Zim government will have a budget of US$4 Billion, out of a GDP of US$15 Billion. In terms of resourcing, this budget shows how the Zim economy is heavilly reliant on the centralised role of the government. Of all the risks indentified in the budget, a risk of  government again failing to deliver is not identified. Markets have no faith in Zimbabwe, as the result of the state itself and its past repeated economic fumbles.

The budget is a sincerely written document, full of commendable aspiration. If the government again fails to deliver, its side of the bargain, Zimbabwe will return to full on economic crisis. Zim Asset seems to be the only tool in this budget; Zim Asset on the other hand will not solve the crisis if bureaucracy, corruption and a lack of transparency re-haunt Zim plc in 2014. The articulate Minister has a battle on his hands, as even he fights to demonstrate his credibility.

Zimbabwe Economy 2014

Economic growth will contract in 2014, given persistent company closures. Real value will be generated in the susbsistence and dollar funded informal sector. Use of the US$ will ensure at most 2% real economic growth, inflation of 5% and GDP per head of US$200.00.

A return of the Zimbabwe dollar will further drive out capital and reintroduce hyperinflationary pressures, as the institutional dynamics of currency stability have not been reinforced in Zimbabwe's economy. A lack of confidence in Zim dollar still persists encouraged by an absent credible macro-economic plan.

Currency and funding shortages will persist, they is no strategy in place to deal with persisting liquidity challenges. Businesses need working capital, which given the scarcity of commercial paper and high interest rates is hard to come by: companies will continue to close, in 2014. Water and electricity shortages will guarantee difficult trading and living conditions for the nation's citizens. The State's Look East policy is not generating the infrastructural investment required to bring about medium term growth.

Old Systems Die Hard

Rhodesia's economy was based on import-substitution and intense state intervention. On the surface the Rhodesian economy appeared strong, however, below was a clandestine engineered economic ponzi mechanism. Apartheid South Africa subsidized Rhodesia by working with inefficient Rhodesian enterprises as part of their political solidarity. Solidarity between two countries running racial discrimination programs ensured Rhodesia could bust sanctions.

The Rhodesian system guaranteed success for the 3% minority, as the majority earned slave wages and lived in rural poverty. Such an economic system inflated economic outcomes for the 3% minority, this deliberate inequitable infrastructure development system sacrificed future development. As war raged it became apparent Rhodesia's so called 'economic success' exemplified a precarious prosperity.

Zimbabwe has totally ridden itself of Rhodesian style economic policy and practice. It has not engaged import substitution, but a small minority is heavily favored by state sanctioned corruption, patronage and incompetence. Zimbabwe's system is yielding the same outcomes as Rhodesia's: infrastructure is not being developed for the majority and sanctions are in place. With business optimism at Rhodesian lows, only moral force can bring back the confidence required to reignite economic performance.

When The Educated Fail To Write

Films need scripts to stay on course. Plays need scripts so actors know their roles, characters and dialogue. When the script lacks clarity confusion ensues.

Managers depend on the scripting of operational guidelines. The sturdiest organisations have bulky operational guides for everything. One single service operation, in competent banking institutions, has various manuals many pages long to specify: product delivery, service roles and working standards.

Our organisations are depleted as they lack comprehensive practical operational guides. Walking into ZIM corporate and government offices one is aware of the total lack of accountability. Things were different 34 years ago when all organisations had comprehensive written, and applied, practical policy guides. The biggest victim of lacking practical policy guide is the economy. As the policy manuals disappeared, so did Zimbabwe’s economic efficiency.

Competitive Disadvantages

To say business is struggling is  understatement. Firms are shutting down and industry, like the dinosaur, is virtually extinct. It started with disappearing factories, that was late 70's; followed by heavy industry taking a bashing in the 80's, now even retailers are having the fates conspiring against them.

Power cuts, water shortages, exorbitant interest and a lack of funding have been haunting industry since the 1990's. No MBA, and or Msc, in Disaster Recovery can prepare those courageous enough to start formal enterprise in Zimbabwe. The executioner wields the noose of  bureaucracy, legislation and corruption for those with the intelligence to circumvent shortages of resourcing.

Zimbabweans are not moaners, but things aren't right. We still have those working for struggling organizations months on end without pay. We salute and respect all these hard working Zimbabweans. Also, we salute those traders and enterprises, in Zimbabwe, fighting against all odds. Lest I forget, lets salute Gideon Gono, he tried and tried-with dignity he resigned; if only others could let go of power and give  Zimbabwe a chance.

Missing link

General Park-Economic Leader

Robert Mugabe has met his match. Politically he has a knack to survive. Zimbabwe right now needs someone to direct and lead the economy into the modern age. After over three decades, Robert Mugabe has failed to deliver on every economic promise.

Zimbabwe has a lot of academically trained  people. This is a hindrance, as it lacks practical leadership in government and industry. South Korea got out of its economic hell hole, through practical men like General Park who fought through economic challenge. General Park did not need MBA's and degrees to deliver. What drove him was purpose and a deep desire to get his country out of poverty.

Zimbabwe has to be honest. Propaganda peddled by The Herald  ensures failed administrators stay in control of a failed economic system. Tightly controlling the economy, as government is doing now, but driving it into permanent recession is the ultimate form of misgovernance. Without a free press to effectively educate  'educated' Zimbabweans, this country remains in crisis. The Herald will not call out the missing link to Zimbabwe's development. Right now, Zimbabwe calls out for economic leadership.

Dollar Effects

The US Dollar has come with its own problems.

Its scarcity, in Zimbabwe, is creating serious funding challenges.

Banks, firms and households are in the midst of a liquidity crisis.

The US Dollar resolved the inflation crisis which was facillitated by poor economic management.

However, dollarisation has not resolved the issue of poor economic management.

The house of Zimbabwe is still in disorder.

With the dollar further weakening export competitiveness, and with foriegn investors, plus donors shunning Zimbabwe; only resolving the economic management crisis and returning the Zim dollar can help Zimbabwe recover.

Speaking to fellow Zimbabweans yesterday, I realised people assume the problems of Zimbabwe's economy will magically resolve themselves.

This is wishful thinking for without  action Zimbabwe's problems are only getting worse.

Factories continue to shut down and our 'leadership' lacks the mettle to get rid of the rot.

Bills, Bills, Bills

You need 'Jobs' to pay bills. Steve Jobs,  created wealth and employment through Apple. US industries like; banks,the car sector, IT and armaments  show when government supports  industry, the jobs will follow. In all successful countries, government support is essential for job creation. To realize the talent of a Steve Jobs, innovation needs to flow through unrestricted.

Government support is key. Entrepreneur industrialists including Steve Jobs, Dale Carnegie and Harold Ford, could not create wealth without the  environment favoring wealth creation. Conducive environs ensure macro-economic stability, rule of law and monetary order. Such environments encourage genius. Talented individuals are not state persecuted ,but encouraged and motivated through policy.

Government can destroy enterprise.In Zimbabwe, our own smart ones are hounded by the government. Mutumwa Mawere, Strive Masiyiwa, Nigel Chanakira...the list is endless, were, and still are  deliberately hindered by a corrupt state. Can you imagine Bill Gates in a place like modern Zimbabwe?- he could not have made a $100 000 , given the corruption & bureaucracy in our country. The greedy politician is destroying Zimbabwe's potential. As talent is destroyed the country cannot pay its bills.

Jobs, Jobs,Jobs

 Zimbabwe economics Image From Bulawayo24.com

Over 10 000 graduates are capped by President Mugabe every year.

Worse than Shakespearean tragedy, these graduands have no chance of securing formal employment. To be self employed or full time unemployed that is the question.

Unemployment in Zimbabwe is over 75%; without formal experience and opportunity, these 10 000 will be stuck in the inflationary increasing poverty stricken.

I did not get capped by President Mugabe. This for me is a badge of honor, given I could see the economy was headed for colossal failure.Seeing  thousands cheering for cemented policy failure, at graduation ceremonies, reminds me- those who abuse their power and the abused are just as bad as each other. When the oppressed cheer their oppressor, you fear for the country's destiny.

Its all about jobs.Strive Masiyiwa, Zimbabwe's technology mogul, declares job creation is the main indicator of political effectiveness. Mugabe and the current leadership have failed to create real jobs, since 1980.

 The false 'socialist' Zimbabwean economy of the 1980s created 'jobs', by inflating the size of the civil sector. This unsustainable process precipitated macro-economic instability. Mugabe and associates should have encouraged growth in private industry, not nationalization, aka indigenization,which  induces rapid decline of all industrial sectors.

 The Zimbabwe theater continues with a recycling of policies that diminish the country's potential-let all the graduands get capped and keep the cheer up for that!

Degrees In Incompetence

The Stae is in denial.'Incompetence the problem,not ....sanctions,' by Samson Hamandishe, on newzimbabwe.com, offers a clear eyed view on Zimbabwe's sanction situation.

Samson Hamandishe highlights the heavy sanctions imposed on Cuba, Venezuela and Iran that have seen these countrys generate economic growth and relative stability. This is in stark contrast to Zimbabwe's continual decline since 1980.

Rhodesia(pre-independent Zimbabwe) was sanctioned and grew its industry. Even before sanctions, between 1980-1989, Zimbabwe's industry was rapidly declining. Sanctions cannot be blamed for this continual de-industrialisation, the cause of decline is poor policy and incompetent policy implementation.

Blame Games

Zanu PF has conceded defeat, already, with regard to employment creation. Since 1980, unemployment (in the formal sector) has crept up from 7% to 95% today. At election time, Zanu PF  promised to create 2 million jobs in the next five years. Zanu PF has now declared these jobs will not be forthcoming as the result of sanctions.

Ian Smith governed under international sanction and still created jobs. This was achieved by preserving industry. Since independence, Zanu PF has commandeered the destruction of industry. Year after year has brought one excuse after another.

Year after year, lofty economic blueprints are presented to no avail. Each economic plan and blueprint brings with it further economic decline. Before blueprints are implemented, Zanu PF is ready to blame this or that for repeated failures. About time the revolutionary party took some responsibility and delivered at least some semblance of democracy, thus allowing Zimbabweans the opportunity to compete and prosper.

Bread Alone

People shun religious concepts. In the beginning of modern classical economic theory, morality was the foundation of economic edict. Economics and morality are two sides of the same coin. Economics came from the study of moral economy.

Here in Zimbabwe corruption rules. Being corrupt, and or corrupted, is indicative of immorality. The indispensable correlation between economy and moral state works both ways. Morality facilitates honesty in government and business, inducing a better economy.

You cannot live on bread alone. The economy cannot function well with just farms, machines, workers, factories and inputs. Human character defines the nature of outputs. Criminal tendencies in state and wider society diminish wealth created.

Morality has infinite degrees. Immorality also has its different levels. When the politician, and or businessman, sends stolen/swindled money abroad the economy contracts. This is the worst sort of corruption as it destroys jobs and future productivity. A lesser corrupt individual might keep money within and use it for productive purposes, this is not as bad. Money can be sent abroad through tax havens or the purchase of expensive imported luxury items. At another degree; when proceeds of corruption fuel speculation in financial assets, and or property, this is worse than using proceeds to create jobs and a sustainable economy.

Rand above Ten

 QE gives then takes away. Problems of 2008/09-Global economic decline still haunt currency markets. The Fed Reserve promised months ago: cheap money for Too Big Too Fail Banks was coming to an end. In response, financial investors with access to these funds are taking funds out of South Africa and other developing countries.

South Africa, India, Malaysia, Brazil plus Argentina (SIMBA) have taken the biggest equity market and currency declines. Only South Africa has resisted trying to resolve a situation that is in the hands of the market. Some emerging counties are frantically trying to stop currency decline, at no avail.

SIMBA countries have trade deficits. Currency decline should reduce imports and improve exports. Unfortunately; strike action in industry, inflation, uncertainty and increasing fuel import costs will negate the potential impact of devaluation. Rand is now trading above 10 to the dollar. For SIMBA countries, currency volatility will persist until the QE situation is remedied.

The Big Man’s house

Respect universal law. “You cannot enter a strong man’s house and take his belongings, until you tie him up”-Mark 3:27. 

Zimbabwe’s elections continually prove this gem from scripture. MDCs will not succeed until they disempower Zanu PF.

Zanu PF is a strongman: controlling; media, security, army, courts, diamond revenues, Zimbabwe Electoral Commission, voter’s roll and the voting process therefore, MDCs stood no chance. Zanu power multiplies, as MDC does absolutely nothing to limit Zanu PF’s capacity. ZAPU, ZANU Ndonga and ZUM all suffered the same fate.

Zimbabwe’s decayed industry is toughest. Zanu’s economic performance, over 33 years, shows they are heavily mismatched. Just like MDC , Zanu PF   fails to tie up their economic opponent. Just like MDC, when it comes to the economy, Zanu PF is making its own fight impossible to win.

Zimbabwe continues to wait for smart people who can out outplay these two  opponents.

False revolutions

The MDCs dodged a bullet. Zimbabwe’s economy is a minefield. Zimbabweans had unrealistically high economic expectations for MDC T, had it won the election. Like The Moslem Brotherhood and Egypt, had MDC T failed to deliver  jobs, unrest would have ensued.

Imagine 2016, had MDC T won., Zanu agitators and crony security elements would have created havoc. An army with Zanu would have recaptured Zimbabwe. Just like Egypt today, they would be a state of emergency and fighting in the streets. That is not so, Zanu sits on the throne of Zimbabwean economic failure. They are lording over a social time-bomb.

Egypt has released Mubarak. The elected, Morsi, has been detained. Given the security forces had power and Morsi had no leverage over the army, secret police and police, Morsi's removal  was predetermined. MDCs have no leverage over Zimbabwe's military-security complex, economic challenges would have left them exposed. Watching The Muslim Brotherhood dodging bullets helps all people realise they was no revolution in Egypt.

3 Fronts Of Chimurenga 3

Zanu talk of a ‘Third Chimurenga’. This new battle is the Zimbabwean economic and agrarian revolution. However, only Zanu can define the terms of the Third Chimurenga. Only the connected, to Zanu, and Zanu bigwigs are living on milk and honey. The people live in poverty which has been worsened by 33 years of Zanu’s economic misleadership. The Zimbabwean is excluded from open political discourse and the free vote by a repressive state. Apart from hunger and being muzzled, the security forces are bent on using violence to repress dissent.

Chimurenga 1 and 2 were bloody affairs. Tragically all the gains from these two struggles have been negated by state sponsored repression. The vote won after Chimurenga 2 is gone. Repressive institutions from Chimurenga 1 are back, and the new oppressor is african. Chimurenga 3 has become a three pronged attack against the people. The weapons are the state, security force and repressive institutions. Worst of all, economic reform is not won by Chimurenga style etiquette.

False Revolutions

Chimurenga is limited. Zanu, ‘the revolutionary party’, lacks the capacity to transform Zimbabwe’s creaking economy. Revolutionary struggle does not entail blaming third parties for all your problems.  Chimurenga had its time, now is time for progress and the people.

Revolution starts within. Victory is a testament of inward change. Dynamics of revolutionary evolution apply to both the people and organisations. Zanu fails to evolve as it sticks to old methodologies, and limited, plus nonexistent self- examination.

Zimbabwe stares at impending economic collapse. Continual repression inherited from colonialism has become Zanu’s national management strategy. Zanu has hijacked the whole state personal to ensure Zanu’s survival. Progress and the people of Zimbabwe are first casualties of Zanu style economic mismanagement. ‘Only Zanu must survive’ or ‘pamberi neZanu’, is the calling card of one party’s  self preservation agenda. Zimbabwe's development has been confined to the back-burner, for the next 5 years only Zanu matters. All economic indicators will continue a downward spiral.

New Zim wine in old bottles

The old guard still rules. Centralized power would have remained intact, whichever way the elections went. This old system cannot accept that which is progressive.

Old wine skins can't hold new wine. Luke 5, the parable of the wine skins, indicates change will always come. When progressive forces withdraw, then other elements are forced to take up the struggle for human right.

New wine destroys old skins. The destruction of old by new is the universal ordering of nature. Zimbabwe's institutional need for progressive change has become the essential ingredient for its economic development. This will only occur when the new guard replaces the old.

Politics over economics

The Zimbabwean economy is cornered again.  Economists have identified unemployment and the desire to further indigenise as serious challenges. The ruling elite see indigenisation as the solution to the employment problem.

 Zanu is hyping up indigenisation. This is the second time Zimbabwe has embarked on  risky economic strategy. Land re-distribution was done to win elections. Indigenisation shows Zanu has its eyes on the next elections.

Zanu is an efficient political machine. However, development needs less politics and more reliable economic planning. Since Growth with Equity, Zanu has had politics at the center of its economic planning. This is the nation’s central economic problem. Political objectives, and getting the vote, are driving economic policy. The end result is more unemployment and further de-industrialisation.

Counting The Cost

Development has a price. Luke 14:28, tells the parable of a builder wanting to construct a tower, before starting the project the contractor ensures all costs and contingencies are taken into consideration.

What is the price of dictatorsip? Underdevelopment is one and poverty is another. Talk of a returning Zimbabwe dollar is being encouraged in nationalist circles. This will only signal the return of inflation.

Dictatorship stifles the majority. Ideas are muzzled and one party cannot encourage diverse ideas. Zimbabwe has no industry, this is the nation's Achilles's heel. Bringing back the Zim dollar, without productive capacity to boot, will push the country ten years back. Indigenisation of the service industry, foreign banks being the main target, will initiate the final collapse of Zimbabwe's economy. When banking indigenisation is completed, be warned, The Zim dollar, with many zeroes, is coming back.

Zimbabwe Elections

Zimbabwe elections are around the corner. Scholars have advanced interesting theories on the Zimbabwe situation. A coalition remains the least likely outcome of this election.

Zanu owns the police, army and courts. Everything will be done to ensure they is no outright MDC T win. They will be rigging-this is obvious, MDC T has to overcome the rigged votes.

To rule Zimbabwe, after elections, it is back to Zanu. All contending parties suffer from factionalism. However, to rule fairly, whoever wins the majority needs to court ideas from other parties. MDC T could never rule without control of the army, police, courts and without diamond revenues. Zanu cannot rule effectively without dealing with corruption. Zanu needs MDC's anti-corruption strategies. MDC needs Zanu's resources. The two failed in coalition, hopefully positives come out of this acrimonious divorce.

Serving Leaders

Jesus teaches leaders should serve. In The Gospel Of John, Jesus washes his disciple's or student's feet. Christ Jesus advised the disciples, as leaders of the people they show love to the people by providing a service.

This issue has been raised in Zimbabwe's election. Welshman Ncube has asked Zimbabweans to demand a leadership that serves the people. This demand should be carried forth even after the election.

Over three decades the country is collapsing. The cause is a corrupt, self-serving,  mis-leadership. Every policy tried in the last 3 decades has been to the benefit of a small elite. After elections the masses need to demand accountability from the new leadership.

New Zimbabwe Leadership

Even Naaman was purified. The Old Testament is an intense leadership guide. Namaan, in his pride, initially refused to heed the advice of the wise.

Zimbabwe's leadership suffers a type of leprosy. The leadership team is tainted by greed and corruption. Corruption started economic failure in the 80's. Things fell apart, as corruption increased and hyperinflation set in.

Zimbabwe's economy is avoided by investors. The economy has been damaged by corrupt leadership. Only a purification of the leadership can wash the economy anew. All parties in leadership need to attack corruption. MDC heads are focused on the corruption issue, while ZANU is not ready to deal with corruption. Like the servants who encouraged Naaman, all citizens need to raise the issue of corruption. Only when the leadership washes anew, and is baptized by a desire for honesty, can true development start being realized. Namaan was cleansed, Zimbabwe can be purified.

Resisting The Pharoahs

Egypt is burning again. Just after one year, the elected government has been removed by the military. Its all about the economy, the masses in the streets know this, the Pharaohs and elites do not.

Mubarak stole billions and sent his loot abroad. Egypt became poorer and more repressive under his reign. ZANU has seen Zimbabwe become poorer and repression currently  equals the Mubarak regime. Fortunately, Mubarak was removed by the Egyptians.

After elections, The Brotherhood took over. Unfortunately, the economy has not improved. The Constitution was rewritten without public input and one million lost their jobs, within one year of Brotherhood rule.Without economic progress every repression is harder to bare. The Pharaohs of old ensured the masses had 'flesh pots' to live on also people had structured jobs.

Zimbabwe has seen continuous economic decline. Millions face unemployment and starvation this year, while the old leadership elite is concerned with self-enrichment and power. Economic decay will ultimately force the masses to resist the Sub-Saharan Pharaohs. Just like in the days of old, millions of Zimbabweans have made an Exodus abroad to escape the slavery of Zimbabwe's system. Exodus creates temporary relief, while the challenges remain. Just like today's Egypt, removing an oppressive regime without a removal of oppressive poverty will see Zimbabwe mired in social unrest and chaos.

Africa's Number 1

Nelson Mandela gave Africa a glimpse of honorable leadership. Obama's recent visit leaves the continent with more memories. Obama sold 'hope' during his first campaign.

The past five years have seen Sub-Saharan Africa enjoy decent levels of growth. Wars have temporarily abated and optimism is high. This hope is a good thing-optimism fires investment. Most investment has been coming from China and Obama's visit will not change that position.

'And now these three remain: faith, hope and love. But the greatest of these is love'-Corinthians. Hope is not enough.You need a lot more than hope alone. Nelson Mandela demonstrated more than hope, in spending years in prison and  forgiving his tormentors. Obama could have offered more than hope in his presidential terms. 

Hope remains Africa's number 1. However, hope is not strategy. To succeed in life, business and relationships, you need perseverance, planning, passion, purpose and prayer to show the way. As prayers flow in for Nelson, let's also pray for other African leaders, so that as beacons of hope they can also  fight for peace and development in the continent.

'Growth' At The Gates

The economy  is drastically slowing down. This short- term slow down is being compounded by election anxiety. Aid money and soft foreign loans, the country's main sources of funding, have been temporarily suspended pending elections.

Foreign financial markets are in chaos. Other developing countries are seeing investors flee local exchanges. This has caused instabilities and even riots in Brazil. The hard lesson is-you cannot depend on so called short term foreign investment.

Zimbabwe needs real, long-term,  foreign investment to finance working capital, technology and infrastructure. Unfortunately, the sort of investors eyeing Zimbabwe's resources are  for short term gain. They want high 'growth' Zim shares and not long term developmental commitment. Zimbabwe needs real growth in employment, sustainable resource use and local re-development.

Financial calamities in Europe, instability in developing markets and the threat of a US$70 Trillion derivatives market, all  indicate when E.S.A.P 2.0  is offered as a development strategy, this should be seen as garbage at the gates. E.S.A.P part 2 will not be the new 'developmental' program's name, but at its heart will be financial liberalization.

Samaritans-The Good, bad and ugly

Image from Sister Elaine's Blog   --www.scimsisters.org

Samaritans come in bundles. The good Samaritan, Gospel of Luke, is hard to find. Most Samaritans are either bad or ugly.

Bad Samaritans exploit countries under the pretext of 'development'. Zimbabwe had another taste of the bad Samaritan during ESAP.

The ugly is, however, also local breed. Come election season, ugly Samaritans promise the moon. Voters are given gifts when they need real progress or taking to the inn.

Good Samaritans don't promise, but deliver. Good Samaritans take a nation toward real progress; they don't take their own people for a ride. Politicians of no value, typical empty vessels, make the most noise.

David and Goliath-brawl for Zimbabwe

Elections in Zimbabwe are nearing. Potential violence which typified all past elections is closing in. Apathy and anxiety rule the roost.

Citizens could learn from the story of David and Goliath. This story is about leveraging the qualities of wisdom and courage to overcome barbarous mighty oppression. On the one hand, you have highly geared oppressive forces going against a quest for fairness. If the fighters for fairness leverage their capacity, they will overcome.

After elections the economy will see battle. Industry is devolving and infrastructure is decaying. Debt still remains massive, while taxes are inadequate. Like David, will the citizenry see this as an opportunity rather than threat. David saw Goliath as a big target.

In living we all endure Goliath challenges. Big challenges can be seen either as terrors, or opportunities for courage and ingenuity. In being thoughtful and  fair, we are getting close to living our potential.

Gold 101

Gold prices have been volatile. In 2009, gold sold at $800 an ounce; in 2011, gold traded at $1900 an ounce; and in April 2013, gold  traded at $1300 an ounce.


Some commentators see gold as a 'barbarous relic'. These believe, the price of gold will decline to $1000 an ounce by 2015.  If this occurs, confidence in gold will decline in the medium term.


Gold has however retained value long term. Goldbugs continue to encourage the purchase of gold as an investment asset. All currencies have declined in value compared to gold, over the last thirty years. The problem with gold lies in short term speculative trades. Gold's short term price is distorted by thin markets and large speculative futures holders. Speculators drive a highly volatile short market, making price predictions impossible. Investing in gold is only encouraged to hedge against long term currency depreciation. Gold can also be used to back a currency and thus counter currency depreciation. Something the returning zim dollar will require.

Feeding The Nation

Luke 9-Christ Jesus feeding 5000

Zimbabwe has food shortages. Luke 9, verse16, reports the miracle of Jesus feeding the 5000. It is possible to feed the multitudes with constrained supply.
Zimbabwe, however, does not have constrained resources. Land is plentiful and in most of years water flows. In Luke, Jesus feeds the masses given his purity of heart and enlightened understanding with regards to heavenly supply.

Moses also  understood the laws of divine supply. To master supply, one has to realize resources are God given.

Just like Jesus, we all need to share with those genuinely in need.  The more genuine the sense of sharing, the more extensive our supply. Greed and selfishness, go hand in hand with shortages and lack. The resource globally lacking is genuine compassionate giving.  Giving that empowers and delivers sustainable growth strategies, between Zimbabweans, will uplift the nation. Self interest will not multiply Zimbabwe's wealth, working for win-win strategies will get us all closer to Christ Jesus. The genuine giving of one, supported by honest leadership and direction at every point, will feed the many.

Build On The Rock

Building on the rock is the only way to construct. This applys to building businesses, systems, economies, friendships, even relationships. In constructing buildings, especially large construction projects, surveying to actual building follows principles.
Just as in construction projects, great care should be taken with the economy. Everything is interlinked, these linkages are both domestic and international.
Every decision made personally builds your destiny. As we make choices, we construct the realities of tomorrow. Every decision made impacts others and they respond in accordance to their decisons. Chain reactions create either order or chaos. Building on the rock is building being aware of counterparties and their  responses.

Fergie- Management 101

Success begins with desire. A burning desire to succeed underlies all great achievement.  Sir Alex is no exception to the laws of over-achievement.

After desire comes strategy.  Long term goals and values are vital in guiding one to the top. Fergie built his success on young teams-remember Beckham, Giggs, Scholes, Yorke and associates. To succeed tomorrow, plan for tomorrow and put in place systems that deliver the intended results.

A long term view requires networks. Networks take time and effort to consolidate. It is no surprise, as 11 former Man United players, under Alex Ferguson, also became premiership mangers the network grew further. Good mangers are leaders as well. Performance sometimes needs management,  at other times coaching and leadership are vital.

Alex joined United in 1986, by 1989/90 United was near relegation. Alex persisted and years after United was on top. Even the best of us need a bit of luck. To realize luck, smart work is essential.

Enterprise In Action

The village Market by Angu Walters

Africa is the capital of enterprise. Visit any African village, city or town, you see more traders than anywhere else. Per capita, Africa leads in entrepreneurship. Africa has more self-employed citizens than found in western nations.

Entrepreneurship is plentiful, however they is little heavy industry and mass production. Africa's  neocolonial legacy has played a part in its industrial lack. Business education in Africa is highly westernized. Academic studies, in business, are made for established corporate entities, not the challenges of African self-employment.

Africa has the entrepreneurial drive. Power cuts, difficult roads, corruption, paltry finances, water shortages, do not stop enterprise. They do however cause serious problems and increase costs. Also, they evidence technological and infrastructural limitations-a long term problem. Biased corporate studies do not support self-employed enterprise. They do not give one the competency needed to overcome Africa's peculiar challenges.

Lessons in enterprise propagate the Main Actor fallacy. Hollywood sells the mythical one hero savior. Schumpeter, the father of modern studies in entrepreneurship, sells the idea of the hero entrepreneur. To realize industrialization, Chang states: individual entrepreneurship has to be channeled into collective productive enterprise.

Collective enterprise benefits from capacity and scale. Africa has a lot of individual entrepreneurs. Institutional advances can channel the efforts of smart enterprising individuals into entrepreneurial collectives. Pooling ideas, capital and skills will create corporate entities. Team work is the way forward for Africa's entrepreneurs. Building organisations will develop skills that will form the foundation of future productive institutions.

Opportunity Costs

Opportunity cost is the alternative benefit foregone. If you have $1, and can either buy a loaf of bread or a piece of fish; opting for bread means you miss out on the fish. On buying bread, the fish becomes the opportunity cost.

In real life choices have complex consequences. Opportunity cost shows the dynamic between limited resources, unlimited wants, and the consequent need to make choices. In 1998, Zimbabwe participated in the DRC war.  This  US$200 million campaign ended up costing the country US$1 BILLION. At the time, Zimbabwe desperately needed infrastructural investment and fuel shortages were disrupting local development. Going to war cost the country more than the direct US$1 Billion costs, for  lenders also cut development aid in frustration. Furthermore, blatant waste demonstrated the state was not serious about developing the country.

Opportunity cost is more complex than a guns and butter trade-off. Some decisions have longer running consequences. Zimbabwe currently has international debts of over $10 Billion. The DRC war represents 10% of this amount, and brought no benefit to the Zimbabwean economy. If money had been put into infrastructure, Zimbabwe's current water and electricity shortages could have been mitigated.

Why Zimbabwe Fails.

Why Nations Fail, analyses economic failures. Like every other  modern economics text, it analyses Zimbabwe's economic failure. According to the authors, Zimbabwe fails because the corrupt ruling elite is extracting, or taking, all the wealth and value.

Extractive forces fuel economic underdevelopment. The book is pretty convincing, however, it is overly biased in its analyses of 'underdeveloped countries'. On the other hand, it fails to identify and condemn extractive forces in the USA economy. The alliance of big finance and government is totally pushed to the side. The authors don't see the drag, and negative impact, big USA financial interest has on the US economy, the developed, even developing world.
The authors fail to call out the elephant in the room. Economics impacts politics and vice versa. Every developing country is at the mercy of US coordinated  international finance markets. Rhodesia was sanctioned,  so was Zimbabwe; sanctions facilitate poverty, creating an environment where corruption creates more poverty.

Developing countries are poor, but still pay higher interest rates than everyone else. Debt thus becomes more unsustainable  Not to mention white elephants, studied in the book, are the result of dubious contractors lobbying poor politicians and enticing them with kickbacks. It is no secret; no financier wants developing countries to realize industrial autonomy. International economic strategy ensures countries like Zimbabwe do not realize their potential.

Zimbabwe has corruption. The authors clearly identify Zimbabwe inherited corrupt structures favoring only the 'five percent'. The authors ideas on inclusion leading institutional progression fail to identify the power of policy, and a government determined to deliver industrial development. Historically, these are governments that refuse to depend on aid but facilitate industrial self-sufficiency. Nations fail when they do not industrialize enough and have to depend on other nations. Nations fail when international loans become the only source of income. These failures are part and parcel of a corrupt multinational finance system. It is this system that allows corrupt leaders to squirrel stolen aid abroad. This book completely overlooks the whole financially corrupt international finance system.

Both domestic and international corruption have played a part in Zimbabwe's economic failure. The local elites are doing their bit for the international elites who benefit most  from Zimbabwe's failure.

Zimbabwe Unchained

Broomhilda

Django Unchained has lessons for all. 
Broomhilda, the heroine in distress, is stuck in a world of oppression and exploitation. Like Zimbabwe, she is under perpetual threat.
 All around her are exploiters, money makers and manipulators of all kinds.
 Django, The 'D',  our hero, is on a mission to save her. He learns the ways of the world from a more worldly mentor, and uses his new found skills to save Broomhilda.

The D goes through his training and gets into a violent final confrontation with his darling's oppressors. The moral of the lesson is: it is never easy to change the order of things. Zimbabwe's economic struggle is going to be long and hard. This lesson was repeated in  past chimurengas.
To bring about change in Zimbabwe will require Django's sublimity and guile. Fortunately, it does not require The D's violent heroics. The solution is to stop supporting the oppressive forces economically, politically and ideologically-we learnt that lesson from Gandhi.

The Economics of Transition

Zimbabwe is in crisis. The elections keep throwing up false hope for Zimbabweans.
After every soap-opera election citizens realize ' they is no such thing as a national economy. Neo-colonialism is real'. African greats, from Nkrumah to Nyerere, learnt foreign financial markets hold sway over local development. Zimbabwe's history demonstrates a  legacy of dependence on foreign  debt markets.
Inspired economic historians, like Ibbo Mandaza, dissected the Zimbabwe economy,  post independence. Some honest politicians lived in accord with the Leadership Code(1985); which was an attempt, by ZANU PF,  to build morality and non-corruption among its ranks. All the good presented by scholars, and honest thinkers, was not accepted by greedy government leaders. Instead, foreign influences corrupted decision makers. Policy was built upon preserving old colonial wealth, so as to extract it one day. No creative decisions were implemented, so as  to build for tomorrow.
To realize transition, Zimbabwe needs to move away from its historical aid dependence.

Escaping the pharoahs

Nations need direction. When the Egyptians crossed the Red Sea they had the inspired leadership of Moses.

Debt is a national burden. It enslaves a society and strangles productivity. Zimbabwe owes more than it produces, it is beholden to foreign lenders. Unbridled consumerism keeps the country importing more than it produces. This imbalance worsens the country's burdened  financial position.

No national debt exit strategy has been defined. National leaders are not providing a sustainable economic development platform. No plan has been developed to escape the pharaohs and cross the Red Sea. Worse, politicians are not moral, or inspired enough, to bring about the systemic change the country needs. Instead of developing a  growth plan, the country is driven further into bondage by the misleadership elite.

Defining economics

Economics is broadly defined as being the study of scarce resource allocation by society. Various theorists have various definitions. Practically economics involves choice in the use of resources, and all these choices have consequences.

Everybody is an economist. We all make choices with regards to how we use time, consume, expend mental energy and transact with our fellow man plus environment. Economics has a problem in that it involves everything. Researchers therefore pick and choose what to study.

These 'schooled' economists follow different schools. No school can explain everything-all schools have limitation- schools related to finance make the most money as they serve financial services. This leaves other schools, with valuable lessons to teach, out in the cold.

The Zimbabwe economy suffered hyperinflation as a sequence of following various schools. The Zimbabwe dollar was removed to reduce inflationary pressures that had worsened the availability of resources. Zimbabwe needs to find more applicable schools of economics to suit its unique institutional setting.

As economics involves institutions, cultural beliefs, complex human behavior, historical influences, political forces, human desires and fears, its scope of study is unlimited. What works in one place, like a Structural Adjustment or Austerity Program, will not work in a different socio political setting. Resources might be limited, but ideas are not. Economic schools need to unlimit economic thought in accord with the laws of nature. They is no limit on thought and creativity which fuel human progress and enterprise.

Read widely-they is no limit to understanding the economy. We are all economists.

Development Potential

Zimbabwe's economy has developmental potential. To realize its capacity the state has to encourage manufacture, rebuild the infrastructure and facilitate Zimbabwean enterprise.

  Zimbabwe has resources. Zimbabweans, at home and abroad, have developed a diversity of core skills. Land, minerals, water and other natural resources are in  sustainable viability. They is spare capacity to build markets, industry and essential manufacturing.

Immense challenges confound Zimbabwe. Debt dependency is the biggest impediment to progress. According to the IMF and other commentators if aid or grant flows stopped, Zimbabwe would virtually collapse.

Having no financial resources creates creates a developmental cul-de-sac. Government has failed to deliver sustainable development, as it has become forced into continual short-term budget balancing. To realize manufacturing and real economic growth, debt has to be overcome. Debt addiction and dependency have halted real economic progress.

33 hard years

Something was achieved. 33 years of sheer survival drive is being demonstrated by Zimbabwe's economically repressed masses.
Without a comprehensive Zimbabwean developed policy agenda, the Zimbabwean will continue to achieve less economically.
Corruption, which is linked to poor policy, also needs to be dealt with.
Corruption worsens the economy. As the Zimbabwe economy declines, the corruption grows and festers.
Corruption and poor economy are the result of economic repression.
Zanu PF has run this 33 year house of Zimbabwe hunger.
Without firm action on corruption, the next ten years will be as bleak as the last 33 corrupted years.

Zimbabwe Economics-Missing Link

Industrialization is evolutionary. Economic models will not help the Zimbabwe economy transition from its current supermarket subsistence state. As shown by the USA, UK, Japan, Germany China and Brazil, heavy duty state support in technological development, on top of state financing of core industry, is needed to seed the development of a reasonable industrial state.

Zimbabwe needs to manufacture. Growing industrial output will:

• Reduce the 100% dependence on foreign manufactured goods.
• Improve employment chances for millions who are unemployed.
• Relieve poverty for 90% of the population currently living in absolute poverty.
• Help reduce corruption, crime and rampant poverty-induced immorality.

Even Ian Smith protected industrial capacity, in the midst of sanctions. Smith ensured Rhodesia protected its core industry.

Government needs to rebuild industry. Policy, made by government, should support industry. As productive capital graduates through subsistence, cottage industry, infant industry, core industry and finally heavy industry- the invisible hand of government is needed. Government plays its hand at every stage of industrial evolution. So far, government has seen industry devolve from core infant industry to supermarket: sub- subsistence levels.

Lets work smart. The Zimbabwe economy cannot live on piss poor planning. Zimbabwe economics should engender smart strategies that deliver employment for the masses of Zimbabwe. Zim economics should not be hijacked by populist, pseudo-socialist,  mantras that do not deliver industry and employment . No more half-baked models, the Zimbabwe economy should see results.

Maggie's Legacy

Thatcher is gone. Former UK industrial towns are celebrating. Zimbabweans remember cordial relations that established links between Thatcher's regime and the Zimbabwe government.

Appearances are deceptive. Beneath the facade of Commonwealth lies a web of deception, treachery and theft. The Lancaster House Constitution was the first significant contract signed by Zimbabwe, at independence. This constitution, overseen by Thatcher’s government, deliberately sidetracked land redistribution which was Zimbabwe’s reason for going to war. Stolen land could only be purchased from farming elites at exorbitant, ‘willing buyer willing seller',  rates. All this laid the first roots for future fast-track redistribution and consequent hyperinflations.

Thatcher unleashed UK Banks. Her financial deregulation and cheap state asset auctions, masquerading as neo-liberalism, destroyed UK industry plus mines on an industrial scale. As 1980s, UK, oil revenues increased, the IMF claimed its programs were a success. Zimbabwe was coerced into ESAP related privatisations which drove back industrial development by over a century. On the other hand, UK ‘big bang’ ‘financial neo-liberalism’ has driven Cyprus, Greece, Italy, Ireland, Portugal, Latvia, Slovenia and other nations to deindustrialisation. These countries are at the edge of total financial ruin. Thatcher played a part in the near ruin of Zimbabwe and Southern Europe is at the brink.  Industrial towns in England were totally destroyed and England is mired in recession. For Zimbabwe and Africa, the stage is set for the next scramble for Africa. Sir Mark Thatcher, Margaret Thatcher’s son, will be waddling back to arrange more coups in the continent.

Where is that state, Zimbabwe?

Zimbabwe has the potential. IMF, the World Bank, western and eastern investors are aware of this fact. Plentiful labour and resources mean growth potential, plus profit, can be reaped in future. This makes it doubly tragic that The State has consistently failed to harness real economic growth, over the past two decades. Even the colonial government could facilitate growth, during years of war and economic sanction.

70s growth was enigmatic. After 1973, the whole of Africa started losing industry due to neo-imperial policy and the role of IMF. Rhodesia, former colonial Zimbabwe, had seen years of economic sanction. The repressive regime was, however, able to attract agro and mineral processing industrial investment from South Africa.  Today's repressive regime has even failed to attract productive South African industrial capital. On coming into power, today's state, induced rapid de-industrialization worsened by hyperinflation. The opportunity to reap the country's milk and honey has been squandered, as the ruling regime has failed to come up with effective industrial development programs.

Corruption is a major problem. Poor planning and implementation make a terrible situation worse. Botched indigenisations, five year plans and E.S.A.P, all represent progroms of extermination against the suffering masses. To regain the 70s level of industry, state transparency is needed. The market will not invest productively in an environment of opacity, and corruption, even if that place is the rapid return economy of tomorrow. Only clear win-win contracts with foreign capital, South African businesses especially, can bring about firms that process Zimbabwe's  agro and mineral potential. Regaining our 70's capacity is the first step. Heavy industry will only be attracted when investors see the success of primary processing. Bringing back the rule of law is a responsibility of the ruling regime. The state  has to act and express transparency, in its fulfillment of mandated responsibility. Action speaks louder than words, anything less is treasonous, and the children of Zimbabwe shall have their day in judging the misdeeds of today. Zimbabweans will not remain underclass immigrants, poor peasants and precariat proletariat forever-all because of an incompetent state.

Economic Resurrection

Christ Jesus told his followers the only miracle they were going to see was the 'sign of Jonah'. Rising from the point of death is desperately needed by Zimbabwe's economy which last saw real success, over 500 years ago, as Great Zimbabwe.
Realizing its potential will not be easy. Firstly, the country needs to resurrect its industrial sector. This is the key to any real progress. Just like other successful industrial nations Zimbabwe will need to produce, produce, produce. Currently the country imports and consumes in a cyclical pattern This consume-consume culture is not sustainable. Zimbabwe has become a major international force as it exports labour directly through emigrations, on top of this, jobs are exported abroad by importing goods from abroad.
To resurrect sustainable productivity, Zimbabwe needs to process its minerals and agricultural produce. Taking this further, more value has to be added in all productive activity. Only when Zimbabwe cuts imports, and starts producing mechanical goods locally, can it say it has taken the first step to resurrecting Great Zimbabwe productivity levels.

Reviving the Economy

Practical economics is not taught in class. Those few nuggets of wisdom picked up in standard textbooks are useful less than 1% of the time. Zimbabwe has a desperate financing need. It is no surprise standard economic theory, which fits into elegant looking models, has been of no value. Economics 101 teaches for a state to finance public expenditure it can either tax, print more money or increase real economic growth.
In Zimbabwe's case, printing money is out of the question. Hyperinflation just a few years ago was a nightmare. As the US Dollar is now legal tender, the Reserve Bank can no longer print bucket loads of green to feed an inefficient consumption economy. Tax collection remains shambolic, as the the ruling elite evades taxes with impunity. Zimbabwe's only way out of the quagmire is through generating long-term real economic growth. So far, Economics 101 has given less than its 1% in helping with Zimbabwe's practical problem.
Mainstream economics text books are worse than useless when it comes to prescribing practical economic guidelines. As Zimbabwe learnt in the 90s, with the Economic Structural Adjustment Programme, following the advice of international aid agencies, and their elaborate economic theory models to the letter; pure economics can be poisonous.
Werner Sombart(1947) clarified growth can be realized through entrepreneurship, modernizing the state and improving technology -The ideas of Sombart are excluded in mainstream economics. Investing in innovation, technology and invention is a long-term process.China started emulating and copying technologies in the 1940s, it only started realizing rapid growth in the 1980s. State development occurs in a cultural context, as such it is another long-term process. This leaves the entrepreneur as the source of immediate long-term growth potential. Conventional economics texts fail to clarify how entrepreneurial potential can be encouraged, given their mathematical foundations. As such, practical economic growth advice for Zimbabwe cannot be found in 101 Economics class and Zimbabwe needs many more productive entrepreneurs.