By Tom Woods and Roger Bate Friday, March 27, 2009
Filed under: World Watch, Economic Policy
Zimbabwe’s Movement for Democratic Change (MDC) celebrates ten years of survival this month. But time is short. As prime minister in the new power-sharing government, MDC leader Morgan Tsvangirai must quickly win the confidence of regional and Western donors to rally financial support and get a struggling country back on its feet. He faces an uphill battle; earlier this month, the EU foreign policy chief announced that the European Union had no plans to lift sanctions and the Obama administration followed suit two days later. Tsvangirai might consider borrowing a page from the Liberian post-conflict reconstruction playbook to create a Zimbabwean Economic Management Assistance Program (ZEMAP).
There is no question that the people of Zimbabwe need immediate relief. Of the country’s 12 million people, at least 4 million have fled; a majority of those who remain require emergency food assistance. All schools and hospitals remain shuttered. Donors are leery of sending money to government coffers for fear it will simply buttress the corrupt rule of autocratic President Robert Mugabe. While some donors may opt instead to direct aid through nongovernmental organizations, bypassing the government entirely, this is a short term, band-aid solution that does little to reinforce accountable rule.
Liberia faced a similar challenge in 2005. Strong bipartisan and international support for assistance existed, but the transition government had its hand in the proverbial cookie jar. The United States pushed for the creation of a Liberian Governance and Economic and Management Assistance Program (GEMAP), which controlled diamond, timber, and other revenues coming into the government’s coffers so that funds were fully accounted for and could not be embezzled to Swiss banks or allocated to corrupt activities.
The program also included strict transparency and oversight of expenditures. Internationally recruited advisers were placed in key ministries and required to cosign with Liberian officials for major transactions. GEMAP faced protests about usurped national sovereignty, especially from politicians or businessmen who had been cut off from their corrupt schemes. But in the end, it helped restore sovereignty where it belonged: to a government required to answer to the needs of its people.
In April 2008, Antoinette Sayeh, then Minister of Finance for Liberia, praised GEMAP for helping to improve transparency and performance of state-run enterprises. Since 2003, GEMAP and the reforms it helped engender have enabled the United States to provide more than $750 million for Liberia’s reconstruction.
While Zimbabwe has been spared the grinding, violent conflict that almost destroyed Liberia, its economic collapse has created a similar crisis. Basic infrastructure such as electricity, roads, reliable potable water, and communication networks no longer exists. And while some officials may look to the private sector for salvation, the odds are not in Zimbabwe’s favor. Speculative investment, in a destroyed economy, run partly by an authoritarian dictator, during a global economic downturn, is a tough sell at best. Any investor venturing back into Zimbabwe will favor quick returns and a speedy exit strategy, which is not likely to improve the life of the average Zimbabwean. By championing transparency for money raised and spent, ZEMAP would help restore confidence and perhaps enable the return of long-term private capital.
By guarding against corruption and cronyism, ZEMAP represents an important first step towards long-term regulatory reform. A bloated retinue of ministers and deputy ministers—now numbering 71, the largest since the country gained independence from Britain in 1980—will certainly be tempted to use their new roles for personal gain; ZEMAP safeguards could help ensure that they do not.
Encouraging the engagement of Western donors, including the European Union and the United States, would diversify Zimbabwe’s sources for aid and advice. This is important because the MDC must remain wary of help from South Africa, which has at every step of the way sided with President Mugabe. Mugabe-era concessions for the country’s rich mineral deposits to China, Russia, and South African companies need to be reevaluated, and international advisers (independent of these countries) could help.
Zimbabwe’s power-sharing arrangement should be viewed as an imperfect and temporary solution to a profoundly unstable political and humanitarian situation. Transparent and internationally monitored elections should be pursued in the shortest timeframe possible and should be linked to any foreign assistance. The ZEMAP concept would be a temporary measure aimed at helping donors meaningfully engage with ministries such as education, finance, and health controlled by Tsvangirai’s MDC.
Day-to-day life is desperate for average Zimbabweans, but circumstances could get worse: the state could fail and violent conflict could ensue. To ensure that does not happen, the coalition government must engage with the donor community to create transparency and accountability in the funding it receives and spends. Most importantly, violators of power sharing must be exposed and punished. GEMAP worked in Liberia, where wait-and-see approaches to assistance were not an option. And ZEMAP, we urge Tsvangirai, just might work in Zimbabwe.
Tom Woods is a senior associate fellow in African affairs at the Heritage Foundation. He helped create Liberia’s GEMAP while deputy assistant secretary of State for African affairs. Roger Bate is the Legatum Fellow in Global Prosperity at the American Enterprise Institute.
Image by Darren Wamboldt/The Bergman Group.
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