Cape Town — Zimbabwe’s new unity government has published an ambitious short-term economic recovery plan which portrays a vivid picture of the extent of the crisis it faces and estimates the cost of addressing its most urgent priorities at U.S. $5 billion.
A 121-page report outlining the plan, entitled “Short Term Emergency Recovery Programme: Getting Zimbabwe Moving Again,” was unveiled in Harare this week by President Robert Mugabe and finance minister Tendai Biti, who was appointed from Prime Minister Morgan Tsvangirai’s Movement for Democratic Change.
The report reveals that:
- Only between 15 and 50 percent of health workers report for duty each day as a result of the high costs of transport and basic necessities;
- 68 percent of doctors’ posts in the country are vacant;
- Getting teachers back to work and dealing with other urgent education sector challenges will cost an estimated U.S. $440 million;
- The country produces only 20 percent of the 2 million tonnes of maize and 500,000 tonnes of wheat it needs to feed its people every year, and needs help to buy the rest;
- Annual gross domestic product (GDP) has been declining at an average rate of -5.9 percent since 2000, with total output dropping by more than 40 percent in the past nine years; and
- Output has declined in nearly all sectors of the economy. Manufacturing has been hit worst, by an estimated 73.3 percent decline. Mining output has dropped an estimated 53.9 percent, and agriculture by 7.3 percent.
The recovery plan calls for urgent financing for this year’s (southern hemisphere) winter crops and for the 2009/10 summer crop. It promises an end to farm invasions which disrupt production, and an audit of land holdings “for the purpose of establishing accountability, eliminating inefficiency and multiple farm ownership.” The plan said it aims to “ensure equitable land distribution as well as ensuring security of tenure to all land beneficiaries.”
The report calls for the lifting of sanctions which deny the country access to credit from international financial institutions and prevent Zimbabwean companies from securing lines of credit.
It says the new government has already begun talks with the European Union, the European Commission, the United States government, the World Bank, the International Monetary Fund and the African Development Bank with a view to having sanctions lifted, as provided for in the agreement establishing the unity government.
Singling out the United States, the report declares: “It is imperative that the Zimbabwe Democracy and Economic Recovery Act (ZIDERA) be repealed…” The act, passed by the U.S. Congress in 2001, banned financial assistance and lending to Zimbabwe for everything except “basic human needs.”
The new government sets ambitious targets. While its immediate plan – which it brands “STERP” reflecting the acronym for its full name – is characterized as “an emergency short term stabilisation programme,” it says it wants to lay the basis of “a more transformative mid-term to long-term economic programme that will turn Zimbabwe into a progressive developmental State.”
“STERP recognises the need to stimulate investment,” the plan says. “Therefore it is the intended objective of increasing investment capacity from 4 percent of GDP to over 25 percent of GDP. These increases are meant to underpin sustainable economic growth and development.”
In perhaps its boldest statement of intent, the report declares: “Priority for the new investment will be given to the area of technology to ensure that not only production capacity is enhanced, but also to fast-track the country into a technological and industrial giant. The South East Asian Model will be embraced to inspire future transformative development programmes succeeding STERP.”
Returning to “short-term emergency policy areas,” the report says sector specialists estimate the costs of rehabilitating Zimbabwe’s infrastructure and social services as follows:
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- Agriculture – U.S. $980 million
- “Specially targeted vulnerable groups” – U.S. $100 million
- Education – U.S. $440 million
- Health – U.S. $300 million
- Water and sanitation – U.S. $740 million
- Giving capacity to local authorities – U.S. $240 million
- Giving capacity to rural district councils – U.S. $15 million
- Support to industry – U.S. $1,150 million
- Electricity – U.S. $370–$2,000 million
The plan asserts that detailed technical work has been done to produce “a well balanced and realistic budget for STERP.” It names the plans priorities as food, water treatment chemicals, education, health, public service employment costs, basic commodity supply, social welfare payments, crop inputs and the rehabilitation of roads.
Read STERP [PDF]
