Friday, June 22, 2007

Crushed by cash

Robert Mugabe has ruled Zimbabwe for nearly 30 years, and during this time, he's tackled a number of challenges to his authority without breaking much of a sweat. You name the crisis, and Mugabe's had a response. Is a portion of your populace supporting rival politicians? No problem, just send a North Korean trained goon squad to blast them to pieces. You say trade union leaders are clamoring for democracy? Just arrest them and beat them within an inch of their lives. Even if the problem is just poor people creating unsightly slums, Mugabe's found ways to come out on top.

However, not all problems can be solved by force, and one such trouble in particular might just lead to the end of the Robert Mugabe era. What's that problem, you ask? Hyperinflation. I've mentioned before on how Zimbabwe's inflation rates have gone well over the 1,500% mark, but it appears now that the worst is yet to come. In the past three days alone, the Zimbabwean currency has devalued by half, a rate of inflation of somewhere between 5,000 and 8,000 percent for the month of May alone. June's been even worse, with currency values now changing twice or more per day as the government simply prints more Zimbabwean dollars to chase after a scandalously tiny supply of goods to buy with their mountains of money.

Yesterday, one US dollar bought 300,000 Zimbabwean dollars and it's expected to rise to 400,000 to 1 by today. Outgoing US Ambassador to Zimbabwe Christopher Dell said the embassy's economic forecast based on the past year's pattern predicts the rate of inflation to reach a staggering one and a half million percent by the end of the year. Normally, the ZANU-PF regime has been untroubled by Zimbabwe's economic woes, just as long as long as the ruling elites had access to reserves of foreign currency that had, in the past, usually been gained by taking kickbacks on government contracts. At one point, this was a very lucrative business in Zimbabwe, and more than one ZANU-PF minister made a fortune skimming contracts on everything from pencils, to oil, to canned goods.

The good old days can't last forever though, and Zimbabwe no longer has any hard currency with which to buy anything. With the country flat broke, power brokers in ZANU-PF are nervously contemplating the possibility they will have to try and make do with getting paid government salaries in Zimbabwean dollars - a frightening prospect for anyone at the moment. The fear of their own poverty, more than any other issue, appears to have driven a solid wedge between Mugabe and the ZANU-PF leaders who used to act as his rubber stamp ministers and parliamentarians. Party infighting, and even coup plots, are tearing apart Comrade Bob's once politically unassailable ruling clique.

Mugabe is desperate to buy US dollars on the black market, if only to secure the gasoline and electricity to keep his security services with the bare minimum of resources required to scare his enemies. He's learning the hard way that these same security services have a finite level of patience for being paid with Zimbabwe's Monopoly money currency, and the odds of Mugabe collapsing under the weight of mountains of worthless cash increase every day. Sure, normal people in Zimbabwe are screwed by this, and the poor even more so!, but they might be able to take comfort in knowing that the symptoms of their economic misery might just prove to be fatal to the man responsible for it all.

2 comments:

martin said...

As a Zimbabwean living abroad your words bring some comfort, everybody wants Mugabe out, yet your words bring fear too. My parents still live in Zim, but their and other Zimbabweans' current problems aside, who will replace Bob Mugabe? Anyone ZANU-PF is bound to be as bad or worse. Look how other nations have disintegrated after their ruling dictator was ousted. On the other hand it's hard to see how Zim could get much worse.

Yonatan said...

At least the next dictator may have half a brain and want his country to be something more than a doormat others wipe their feet on to travel to some other african country. Zimbabwe id a dirt heap now.. mugabe forgot he had people under his rule, he just believed he had his palace and his little soldier boys to watch over... museveni and even ethiopia's leader at least have some prospects for the civilians.. mugabe is a lunatic.