Re: [Marxism] Zimbabwe- the Ruthless Privatisation of All that Exists

[Patrick Bond <pbond@xxxxxxxxxxx>]

Aaron Aarons wrote:
 > I searched the so-called "ZIMBABWE PEOPLES' CHARTER" for the 
following words:
 >
 > capital[ism]
 > imperial[ism]
 > [neo-]liberal
 > socialist/ism
 > ...

Well, we work with what's there. And the social forces that signed on 
are the most progressive elements in the society. There are lots of 
other anti-neoliberal sentiments that should have appeared, which the 
activists are working with on a daily basis. Still, it pretty clearly 
demarcates these forces as opposed to the Cato-influenced MDC wing in 
charge of economic policy formation.

And unfortunately, as is oft remarked, cde Mugabe has *ruined* some of 
these words: anti-imperialism, socialism, 'land redistribution'. Read 
Frantz Fanon's Wretched of the Earth, ch.3, to get a sense of why 
African nationalism turns to left rhetoric to smash its left opponents.

Here's one take on how the ideological terrain in Zim was so muddied:

***

Uneven Zimbabwe: A Study of Finance, Development and Underdevelopment
Africa World Press, 1998

CHAPTER 6:
POST-INDEPENDENCE âSOCIALISM,â NATIONALISM AND CAPITALIST STAGNATION


Introduction

In the last chapter the 1960s boom and 1970s economic crisis were 
explained in large part using classical Marxist insights about the push 
and pull factors which direct flows of capital into different sectors 
over space and time. Under the prevailing conditions, very little scope 
existed for tightly-controlled financial markets to operate freely, to 
send liquid capital into more auspicious investments, or to exercise 
control over the direction of the countryâs political evolution during 
the transition from Rhodesia to Zimbabwe. But following independence in 
April 1980 the relative power and importance of financial flows in the 
economy changed dramatically. In view of the fact that subsequent 
chapters are devoted to speculation, debt and financial control issues, 
this chapter downplays the financial aspects of uneven development so as 
to turn attention to the underlying conditions of stagnation in the 
productive sectors of the economy.

The perseverance of economic stagnation is, by nearly all accounts, the 
single most important constraint Zimbabwe experienced in its political 
and social life since independence. (As structural adjustment policies 
did their damage in the early 1990s, there was a perceptible shift from 
nagging concerns amongst even the business elite over stagnation to 
outright panic regarding the growing prospect of full-fledged 
deindustrialisation.) The legacy of stagnation is very often blamed in 
popular discourse on ZANUâs 1980s âsocialistâ orientation, which 
requires a bit of debunking. In reality many of the policies adopted by 
the new government in the field of economic development represented 
continuity from the worst of Rhodesian state capitalism, rather than 
change. Ironically, perhaps, it was as a result of the failure of such 
policies that the opportunity arose for the power of finance to make 
itself felt. Throughout the 1980s, the existing economic structure â 
classic monopoly capitalism, with key sectors still controlled by whites 
and foreign companies â and many supportive state policies were 
sustained, and these were important in setting parameters on how 
development would proceed. In particular, they made it difficult to 
generate new options for accumulation. Instead, it would take a decade 
of capitalist stagnation before radically free-market policies were 
deemed necessary.

Post-independence stagnation and crisis can be easily illustrated by 
surface-level statistics.1 Following the boom of 1979-81, only in 1985 
and 1987-90 was there real per capita GDP growth. The years 1982-84 and 
1986-87 witnessed negative per capita GDP growth â in 1984 and 1987 of 
-4% â and 1992 showed an enormous per capita GDP loss of 11% followed by 
a paltry, uneven recovery. The most conspicuous symptom of stagnation is 
the incessant decline in the percentage of the population formally 
employed, which peaked in 1960 at 19%, declined but peaked again in 1975 
at 17%, and steadily dropped to around 11% in the early 1990s. By then 
the unemployment rate had reached 50%, as 200,000 young people were 
discharged from schools each year but looked forward to job creation of 
20,000 in a good year. The result was often described as a âtime-bomb,â 
and a consensus thus eventually emerged among the countryâs elites, 
under heavy pressure from international financial institutions, that the 
only possible means of defusing it was economic liberalisation in the 
form of a draconian âEconomic Structural Adjustment Programmeâ which was 
applied from 1990.

This chapter explains the persistence of stagnation and uneven 
development in the context of surface claims of a transition to 
socialism. The intention is not to offer a comprehensive survey of 
social and spatial developments since Zimbabweâs independence but to 
provide, instead, a series of snapshots of different aspects of the 
Zimbabwean experience. These help us to locate processes of class 
formation, financial speculation, uneven urban and rural development and 
international financial control in subsequent chapters.


Repression, class formation and socialist rhetoric


One of the first chores any commentator on Zimbabwe faces is separating 
socialist rhetoric from raw capitalist reality. During the 1970s both 
ZANU and ZAPU adopted what were termed âscientific socialistâ 
principles, although these were distinguished for their pragmatism. The 
ZAPU Revolutionary Council (1977, 4), for example, once insisted that 
âprofit is the mainstay of all exchange, bargains or trade and is not 
per se a contradiction to socialism.â Marxists with more integrity were 
to be found in the Zimbabwe Peopleâs Army and March 11 Movement (which 
were both suppressed), but, according to David Moore (1992), their 
âchallenge did not extend significantly beyond the intelligentsia on the 
road to power, and thus did not gain hegemony within the popular classes.â

While the class character and ideological legacy of the Zimbabwean 
liberation struggle are still bitterly contested,2 one theme stands out: 
in contrast to more romantic notions of the possibility for radical 
transformation of the living conditions of peasants and workers under a 
friendly nationalist government,3 the connection between those directing 
the struggle and the constituencies meant to benefit was ultimately 
tenuous. Ian Phimister (1988b, 8) concludes that âThe alliance of rural 
class forces underpinning the guerilla struggle which eventually 
overthrew Ian Smithâs Rhodesian regime was united in opposition to 
colonialism but little else. There was no shared vision of the future 
beyond the recovery of land lost to the whites.â

It is in this sense that there was no durable basis amongst existing 
social forces for the liberation movementâs socialist ideology. And it 
should not be surprising, therefore, that from colonial days through the 
post-independence period of Zimbabwean âsocialism,â capitalist relations 
persisted without substantial threat of upheaval. Three years prior to 
independence, an exceptionally accurate prediction was made by R. Murapa 
(1977, 28):


The present alliance is not dictated by ideological homogeneity, rather, 
it is one of convenience between a politically ambitious petty-bourgeois 
leadership, a dependent and desperate proletariat and a brutally 
exploited and basically uninitiated peasantry. The hope to neutralise 
the real capitalist forces of exploitation remains distant. After 
national liberation, the petty-bourgeois leadership can abandon its 
alliance with the workers and peasants and emerge as the new ruling 
class by gaining certain concessions from both foreign and local capital 
and, in fact, forming a new alliance with these forces which they will 
need to stay in power. Of course, lip service commitment, a la Kenya, to 
the masses, will be made.


Indeed Zimbabwe perseveres long after independence as a semi-peripheral 
neo-colony â witnessed by its profound reliance on exports of primary 
commodities, extreme differentiations in domestic income and wealth 
(which remained among the most skewed in the world), and Zimbabweâs 
wholesale adoption of the economic and social policies of international 
financiers. However, this reality was somewhat veiled during the 1980s 
by the combination of radical-populist rhetoric from government (and 
especially government-controlled media) and the steady hand of a strong 
and visible national capitalist class (especially in manufacturing and 
agriculture). The notion that a socialist experiment was underway in the 
years after independence, all evidence to the contrary notwithstanding, 
served both groups well.

To illustrate, the white capitalist class firmly overlapped with 
Zimbabweâs vocal but small liberal elite, who generally looked down upon 
the liberation forces with scorn. This was a long-standing 
characteristic, as thinly-veiled racist overtones often distinguished 
liberal attacks on the socialist project in Africa. In her biography, 
renowned writer Doris Lessing recounted, from early adulthood (during 
World War II), membership in a tiny, lily-white Southern Rhodesian 
Communist Party which soon disintegrated, apparently because of the 
groupâs total failure to tap into the kind of organic radicalism of 
black workers that generated a general strike in 1946. Bitter, Lessing 
(1994, 279) had inexplicably concluded that âCommunism was too abstract 
and inhuman an idea to satisfy Africans â and in fact, when later there 
were Communist or Marxist regimes, they did not last long.â Lessing 
(1994, 367) considered post-independence Zimbabwe a âCommunist 
government, too extreme for the natural temper and style of the black 
people.â

To local white elites and their allies in international financial 
institutions responsible for development aid, blacksâ alleged temper and 
style were, it seemed, better geared to the inculcation of 
petty-bourgeois norms and values, through a variety of well-known 
methods (Chapters Four and Nine describe the key example of housing 
finance). Under such pressures, the post-independence class-forming 
process soon degenerated into a situation in which not only would any 
residual socialist consciousness wither but full-blown compradorism 
ultimately prospered. As Arnold Sibanda (1988, 62) explains,


The reconciliation with whites, together with some fundamental aspects 
of their colonial rule and patterns of ownership of the means of 
production, constitutes nothing beyond an institutionalisation of class 
alliances as a condition for an orderly transfer of power from a 
settler-colonial state to nationalist militants without disruption of 
the reproduction of capitalism. Thus the [Lancaster House] constitution 
was a concrete manifestation of the triumph of the condensed 
class-strivings of monopoly allied with settler capital over the 
national democratic bloc, a triumph which successfully prevented the 
materialisation of a full national democratic revolution. The new state 
thus emerged with features of a classical neo-colonial formation with 
the corresponding class structures.


How, then, to explain the decade-long maintenance of official socialist 
discourse in Zimbabwe under such conditions? A brief review of the 
challenges to ZANU hegemony suggests that the countryâs nationalist 
leadership spent the 1980s maintaining left-wing discourse apparently in 
order to repress protest mainly from the Left.4 Workers, for example, 
engaged in 150 formal and wildcat strikes against private firms 
immediately before and after independence (accounting for 72% more lost 
days than Zimbabweâs much larger, more proletarianised neighbour South 
Africa experienced in 1980). Brian Woods (1988, 286) considers the 
circumstances in which newly-elected Prime Minister Robert Mugabe found 
himself in May 1980:


The Prime Ministerâs crucial meeting with Harry Oppenheimer, head of 
southern Africaâs largest transnational corporation, the Anglo American 
Corporation, coincided with the start of two large and relatively 
prolonged strikes at the companyâs major coal mine in the northwest and 
its sugar estates in the south of the country. It was at those two 
strikes that the police, and in the case of the Wankie Colliery, the 
army, were sent to protect installations and those who returned to work, 
as well as to arrest thirteen miners under the provisions of the 
Industrial Conciliation Act [of 1934].


Also in 1980, Mugabe declared one strike of bakery workers ânothing 
short of criminal,â while his Labour Minister Kumbirai Kangai sent in 
police to end a strike at a transport firm and declared: âI will crack 
my whip if they do not go back to work.â5 A second wave of strikes, 
beginning in early 1989 and lasting through mid 1990, was met with 
police violence (for example, against teachers in downtown Harare), and 
also featured the detention without charges of Zimbabwe Congress of 
Trade Unions leader Morgan Tsvangirai under the 1965 Rhodesian State of 
Emergency, still in force at that stage. Subsequent strikes were 
generated largely from the public sector, in health, the postal service, 
airlines and railways. Aside from the occasional minor success, most 
were dealt with in authoritarian manner and ended with the workers 
defeated and despondent.

To illustrate the importance of ideological concerns, Tsvangiraiâs 1989 
detention was specifically motivated by his mild support for a 
courageous verbal attack on the government by University of Zimbabwe 
students, who remained a consistent thorn in the governmentâs (left) 
side during the late 1980s and early 1990s. The students were 
periodically harassed, locked up in the course of demonstrations, and 
faced university closure on several occasions. A draconian law was 
introduced to control the students by effectively making the university 
a parastatal institution, and ZANU functionaries used left-wing rhetoric 
to paint the students as âcounter-revolutionaries.â6 Official political 
repression of a more dangerous sort was experienced by opposition 
parties ZAPU (coinciding with an estimated 5,000 murders of innocent 
Ndebele civilians by government forces during the 1981-86 Matabeleland 
conflicts) and the Zimbabwe Unity Movement (which opposed ZANU from the 
right but which gained the support of many urban dissenters) (Lawyers 
Committee for Human Rights, 1986; Mandaza and Sachikonye, 1991).

In addition, landless urbanites faced an unsympathetic government in the 
early 1980s when on two occasions, different groups of 30,000 people 
were forcibly removed from the Harare âhigh-density suburbsâ (ie, black 
townships) of Chitungwiza and Epworth. High-profile displacement on a 
somewhat lesser scale occurred in the early 1990s when the Queen of 
England visited Mbare (formerly âHarari,â the closest high-density 
suburb to the city centre) and was protected â through forced removals â 
from the unsightly spectacle of squatters. Later, when opposition 
politician Ndabiningi Sithole attempted to initiate a shack settlement 
on his Churu Farm, the authorities clamped down rapidly and 
remorselessly, âclearly motivated by political interests,â as the 
Catholic Commission for Justice and Peace put it (FG, 19/5/94). More 
generally though, evictions were carried out under the pretence that, in 
the words of Harareâs Director of Community Services, âsquatting is not 
an acknowledged form of shelter in Zimbabweâ (Taylor, 1985, 27).7

Women, too, both experienced sustained structural discrimination and 
received severe treatment at the hands of the authorities throughout the 
post-independence period, witnessed, for example, by instances in 1982, 
1983, 1986 and 1990 in which hundreds of single urban women were 
ignominiously rounded up at night for alleged prostitution (Barnes and 
Win, 1992, 126). The Zimbabwean constitution prohibited discrimination 
in theory, but exempted gender discrimination based on adoption, 
marriage, divorce, burial devolution of property on death, or other 
matters of personal law (Kazembe, 1986; Batezat, Mwalo and Truscott, 
1988). By the early 1990s, Mugabe himself forcefully defended womenâs 
oppression on national television, and also displayed hints of 
anti-Semitism. And in 1995, fierce bigotry against gay men and lesbians, 
bordering on paranoia, became a presidential sport worthy of 
international condemnation.

Putting down challenges from social forces with potential left-wing 
tendencies was the only conceivable function of ZANUâs protracted 
socialist rhetoric. That rhetoric was maintained religiously for the 
first decade of independence, notwithstanding the fact that 
petty-bourgeois party leaders repeatedly violated even their own 
leadership code prohibiting excessive personal capital accumulation.8 As 
Lloyd Sachikonye (1995b, 180) argues, âThe assumption of the 
petty-bourgeois leaders of the liberation movement was that socialist 
cadres and party members were largely moulded through ideological 
education... The elements of choice and voluntarism underlay this 
rationale for the adoption of socialism from amongst a menu of ideologies.â

The evolving words and actions of leading ZANU politician and liberation 
war hero Maurice Nyagumbo are telling, beginning in 1983: âI do not fear 
that some monster called the black elite will jeopardise the revolution, 
because we are educating people on socialism and this is being accepted 
so that no single class of people will or can make people follow them. 
We do not believe in the elite, they must identify with the rest of the 
peopleâ (1983, 7). But by 1986, Nyagumbo was sufficiently worried to 
call for âan emergency congress (to) tell the people that we are unable 
to fulfil one of our important resolutions... mainly that of scientific 
socialism, because the leaders acquired property... appear to have 
adopted capitalism, become property owners and appear to be deceiving 
our peopleâ (Herald, 21/7/86). In 1989, Nyagumbo, then the third-ranking 
government official, committed suicide as a result of his involvement in 
the Willowvale car assembly scandal.

By the late 1980s, the ruling partyâs decaying bona fides became the 
subject of some debate amongst Zimbabwean intellectuals who queried the 
status of the ZANUâs âsocialist project.â Some were misled by the 
rhetoric â late in the day the countryâs premier geographer, Lovemore 
Zinyama (1989, 234), forcefully argued that âZimbabwe is slowly heading 
towards state socialismâ on the basis of red herrings such as the 
one-party state issue. But just as much as other sectors of society, 
radical intellectuals, too, had to be brought aboard the national 
project. Ex-President Canaan Banana (1987, vii) noted that while 
âsocialism based on Marxist and Leninist principlesâ has made 
âremarkable advancesâ in Zimbabwe, it was âregrettableâ that âthere 
does 
not seem to have been a corresponding development in the intellectual 
sphere that would enable rational conceptualisation and evaluation of 
the content, mode, and pace of our national development strategies.â

This was, notwithstanding the fallacious preface, fair criticism. 
Whether caused by romanticism, or perhaps occasionally by subtle and 
overt pressures applied by government, the intelligentsiaâs âfailure of 
analytical nerveâ permitted such optimistic arguments as â in this case 
in the (otherwise extremely critical) work of Colin Stoneman (1988b, 4) 
â âa process, full of contradictions, gains and reverses, is under way 
that could eventually lead to a socialist society in line with 
government pronouncements.â Likewise, positing that âZimbabwe, like 
Rhodesia before it, is somewhere in between socialist and capitalist 
parameters,â the (self-described) postmodernist Christine Sylvester 
(1991, 183,187) hence found âfew sharp conclusions to draw or clear 
lessons to reiterate.â A less timid group of indigenous intellectuals 
led by Ibbo Mandaza and associated with the magazine Southern African 
Political and Economic Monthly was on the one hand anxious to avoid the 
alleged ârevolutionary mythologyâ of other Northern Hemisphere 
Africanists (namely, John Saul). But on the other hand Mandaza (1986a, 
1986b) generally stood ready to place the blame upon âinternational 
finance capitalâ â which, remarked Sibanda (1990, 2), âapproximates an 
`apologiaâ for the ruling petty bourgeoisieâ â while effectively 
neglecting the deeper structural process of capital accumulation.9

There were others yet, such as Paul Teedon and David Drakakis-Smith 
(1986, 310,323), who contended that Zimbabweâs failure to break with 
settler-capitalism reflected (the otherwise socialist) ZANUâs inability 
to withstand âthe pressures and blandishments of international 
capitalismâ which was in part due to an anti-urbanism inherent in the 
âgeneral Maoist tendencies within African socialism.â In the urban 
areas, Neil Dewar (1987, 47) recounts an idealised version of ZANU party 
organisation, pointing to the means by which geographic hierarchy was 
established by âa party inspired by a Marxist-Leninist conception of 
socialism... into party Cells, Branches and Districts. This served both 
to politicise and mobilize the people while at the same time ensuring 
that members of the District executive who also became city councillors 
would be sensitive to, and able to respond to, problems experienced at 
`grassrootsâ level.â10 That ZANU was in reality neither pro-peasant 
âMaoistâ nor urban-oriented âMarxist-Leninistâ will become evident in 
later chapters.

More practical than intellectual observers of Zimbabwean âsocialism,â 
perhaps, even if ultimately as misleading, was Mugabe himself, who in an 
interview not long after independence spoke of delays in socialist 
mobilisation âuntil we have managed to establish an adequate 
infrastructure and a basis of human skills, and until we have proceeded 
to educate our people on our principles so that by persuasion they can 
see the goals as we see themâ (Herald, 10/6/81). Until then, ZANU would 
reign over a state monopoly capitalist economy inherited from Rhodesia, 
and would do so, ostensibly as a Marxist-Leninist party, because state 
ownership could be legitimised (in the minds of official pundits) as a 
stepping stone to socialist relations of production. As Mugabe 
explained, âSome people argue that ownership by the state amounts to 
state capitalism. That may very well be; it depends entirely on how 
state ownership translates itself... The state, acting as custodian of 
the people and the society, will ensure that capitalism diminishes and 
that the area of socialism is augmentedâ (Moto #6, 1984).11

In this spirit, the most charitable statement of Zimbabweâs 1980s 
doctrine â in the words of the Government of Zimbabwe Transitional 
National Development Plan (1982, i) â was that ZANU ârecognises the 
existing phenomenon of capitalism as an historiÂcal reality, which, 
because it cannot be avoided, has to be purposefully harnessed, 
regulated and transÂformed as a partner in the overall national 
endeavour to achieve set national Plan goals. AccordÂingly, whilst the 
main thrust of the Plan is socialist... ample room has been reserved for 
perforÂmance by private enterÂprise.â Even if completely implausible as 
a description of the Plan itself, this was a coherent ideological call 
for ever-elusive capitalist development in some ânational interest,â and 
coincided with other rhetorical statements usually â as in the following 
example by leading state ideologue Cain Mathema (1988, 9,10) â aimed at 
establishing popular-front politics:


Our local capitalists, regardless of race and nationality (Shona, 
Ndebele, Khalanga, Tonga, English, etc.) have to be mobilised against 
neo-colonialism, they have to be allowed to operate in those areas of 
the economy which at any particular time are found to be operated best 
by the local capitalist class... Also, our capitalists have to be 
educated to see that as long as the multinationals remain in control of 
the commanding heights of our economy, they (our bourgeoisie) will 
always play a peripheral role. It is in their interests therefore to 
work hand in hand with the government because their role will be clearly 
defined and their interests better protected.


Rhetoric of this sort suggests that multinational corporations would not 
get red carpet treatment in Zimbabwe during the 1980s (although 
individual tycoons such as Tiny Rowland of Lonrho, Tony OâReilly of 
US-based Heinz and British mining tycoon Algy Cluff were fast friends of 
the socialist rulers, and the influence of Oppenheimer, the continentâs 
greatest magnate, was remarked upon earlier). But in reality, ZANUâs 
corporatist approach presented no great threat to capitalist interests, 
even those headquartered in London and Johannesburg.12 On the contrary, 
foreign investors were periodically wooed with much more frank 
admissions about the state of socialism in Zimbabwe, in this case by 
Finance Minister Bernard Chidzero speaking at a 1982 investment 
conference in New York:


Does the government of Zimbabwe have something up its sleeves? We are 
socialists, are we encouraging you to come so that tomorrow we can grab 
you? If thatâs what you think, I can assure you that we have nothing up 
our sleeves, we are simple pragmatists... Let us not fight the battle on 
ideological grounds. Life is more serious than to be controlled by 
ideologies. Life is very down-to-earth, let us just look at the 
realities of life. And I believe that good businessmen enter into 
riskier areas than areas where we talk about ideologies without doing 
much about it (emphasis added).


The cowering presentation by the normally urbane Chidzero was 
immediately followed by the more calculated view of the US State 
Departmentâs Chester Crocker:


The US believes that Zimbabwe can become a showcase of economic growth 
and political moderation in southern Africa, a region of substantial 
strategic importance to us. That belief rests on facts, not illusions... 
As part of the Reagan administrationâs worldwide policy of support for 
economic development, we have embarked upon several new approaches in 
our assistance programs. We believe these will strengthen the role of 
indigenous private sectors and facilitate US private investment to 
stimulate developing economies.


Providing the icing on the cake, the head of the Confederation of 
Zimbabwe Industries (CZI) quite prophetically


concurred with the view expressed by Dr. Chidzero that it is time to put 
away âismsâ and that over time, more emphasis is likely to be placed on 
private enterprise development than on the public sector... What is 
needed in Zimbabwe is export-led growth, and over time, the spectrum of 
opinion between far right and far left will converge, causing âismsâ to 
disappear (African-American Institute/American Bar Association, 1982, 4-12).


The result was an operating environment termed âbusiness friendlyâ by a 
United States Agency for International Development (US AID) industrial 
consultant (Oakeshott, 1987, xv). At the time of independence Stoneman 
(1982, 290) had warned, presciently, that


Piecemeal or pragmatic state action (seeking accommodations, guidelines, 
joint ventures, minority holdings, some nationalization with generous 
compensation and management contracts, and so forth), that is, the type 
of policy often erroneously described as âsocialistâ or âAfrican 
socialist,â will in the face of such an economic power bloc be no more 
successful in reducing inequality, tackling rural poverty, establishing 
economic independence or producing rapid economic growth than in many 
other African states.


In contrast to the socialist promises, ZANUâs corporatism allowed large 
local companies to ultimately exercise considerable influence over state 
regulatory policies. A former president of the CZI, David Long, exhorted 
other executives:


Our role is to change the overall picture, to look at the overall 
environment and seek to change that for the good of our members through 
bringing constructive pressure to bear on government in bringing about 
policy changes and creating an environment conducive to free enterprise 
and the efficient operation within that environment. And this we have 
done most successfully during the past decade. Government makes the 
rules. We hope, at most, to play on the same team and to have some 
opportunity to influence policy decisions. Compare this to the situation 
in which we were in 1980, across the table, daggers drawn 
(Industrialist, July 1991).13


But regardless of radical rhetoric â and it remained fiery and 
occasionally anti-imperialist even into the 1990s â not long after 
independence ZANU effectively jettisoned any socialist baggage it may 
have carried from the liberation struggle. US AID (1982, 15) soon 
expressed satisfaction that âThe Government of Zimbabwe has adopted a 
generally pragmatic, free-market approach... and this approach has the 
full support of the US AID.â The view from inside a large US bank in 
1982 was also one of reassurance:


The management of the more sophisticated large companies, ie, TA 
Holdings, Lonrho, and Anglo American, seem to be impressed by and 
satisfied with Mugabeâs management and the increased level of 
understanding in government of commercial considerations... I feel it is 
a political pattern that Mugabe give radical, anti-business speeches 
before government makes major pro-business decisions or announcements 
(cited in Hanlon, 1988, 35).


A decade after Lancaster House, a ZANU leftist, Lazarus Nzareybani, 
Member of Parliament from Mutare, agreed:


The socialist agenda has been adjourned indefinitely. You donât talk 
about socialism in a party that is led by people who own large tracts of 
land and employ a lot of cheap labour. When the freedom fighters were 
fighting in the bush they were fighting not to disturb the system but to 
dismantle it. And what are we seeing now? Leaders are busy implementing 
those things which we were fighting against (Sunday Mail, 10/12/89).


Such commentary merely illustrates the persistent surface-level search 
for explanations of what were actually much deeper-rooted commitments to 
the existing economic order. For as the 1980s witnessed a dramatic 
backpeddling from the socialist vision, ZANUâs main goals were reduced 
to Africanising the colonial state and forcing some limited inroads into 
white capitalist old-boy networks. Sibanda (1988, 275) concludes, 
correctly it seems, âWe cannot therefore justifiably measure the actions 
of the present Zimbabwean state on the basis of a scientific socialist 
yardstick, for the socialist project was not seriously on the agenda and 
could not have been, without the working class either being organised, 
or represented, or acting as a combatant class on the stageâ (original 
emphasis).

In this context, the incongruous persistence of left-wing official 
rhetoric has done great damage to more organic left prospects â as in 
Prague where socialism âis a really awful word, for ordinary people it 
has been destroyed completelyâ (according to a leading young activist 
who inspired Wainwrightâs [1994] Arguments for a New Left). Actually, 
when as late as September 1991 ZANU reaffirmed its commitment to 
Marxism-Leninism, Senior Minister of Political Affairs Didymus Mutasa 
responded in an interesting (apparently Trotskyist?) way to the general 
global collapse of the âcommunistâ movement: âThe political system in 
eastern Europe could be best described as state capitalism and therefore 
not different from that in Western Europe, except that there it is 
carried out by individualsâ (FG, 19/9/91).

Ironically it was at precisely this point that the failures of 
Zimbabweâs Economic Structural Adjustment Programme (ESAP) â which was 
supported by the party in no uncertain terms â made it virtually 
impossible to sustain the idea of socialism.14 This was aptly remarked 
upon by Nkosana Moyo (1991, 4), managing director of Standard Chartered 
Bank: âWhat is rather forlorn about the continuing ZANU debate on 
socialism is that it is basically a sinister manoeuvre of deliberately 
flogging a dead horse to hoodwink and confuse the nation in order to win 
sympathy among the weak minded.â And as for ESAP, âHow can it succeed 
when it is being spearheaded by political sharks who, devoid of business 
values, are using political clout accumulated over the last eleven years 
to invade the private sector under the assumption that business is 
politics and politics is business?â


Monopoly capitalist reality


Indeed business was a matter of politics, in important ways. The role of 
the âpolitical sharksâ among Zimbabwean financiers and bureaucrats is 
reviewed in more detail in the next chapter. More generally, state 
officials maintained the responsibility to take over failing firms on 
the one hand, and on the other were easily intimidated by monopoly 
capital. Writing in the late 1980s, Stoneman (1988c, 48) could still argue,


Zimbabwe is a market economy, in which firmsâ decisions are based on 
calculations of profitability. It is not, however, a free-market 
economy, and if the workforce does not question managerial prerogative, 
then government does. In investing, in importing inputs, in exporting 
output, in paying or firing workers, in expatriating profits, firms are 
under tight governmental control. In exchange, they benefit from a high 
degree of protection, and in many cases, of monopoly on the local 
market; the workforce is also effectively constrained from striking, and 
state provision of social services, including education, healthcare and 
housing, relieves firms of the costs of ensuring a healthy and 
reasonably contented workforce.


There were certainly bureaucratic controls and often excessively-tight 
regulation (mainly inherited from Rhodesia, rarely initiated from 
scratch by ZANU). Yet the state did not attempt, either through 
bureaucratic fiat or its extensive industrial holdings, to interfere in 
the corporate profit calculus or otherwise fundamentally alter the logic 
of capital accumulation.

Government ownership of capitalist means of production occurred mainly 
through the Industrial Development Corporation, and amounted, by the end 
of the 1980s, to a 4.6% stake in Zimbabweâs manufacturing sector. The 
main post-independence acquisitions were in metals and metal products, 
and in pulp and paper and agri-industrial subsectors. Large 
post-independence government ownership shares of in excess of 40% were 
registered in the pharmaceutical (CAPS Holdings) and food processing 
(Olivine Holdings) subsectors. Other majority-ownership acquisitions 
included Zimbank and Wankie Colliery, and a majority holding was 
maintained in the Zimbabwe Iron and Steel Corporation.15 What this often 
led to in practice, Sibanda (1990, 8) points out, was âa `shadowâ 
management implementing real decisions which are taken in the 
metropolis, the proportion of shares held by the host state 
notwithstanding. This shadow petty-bourgeois partner is at a 
disadvantage since the imperialist partners have more knowledge 
available to them concerning the productive operation of the enterprise.â

The young government also faced monopoly control of markets. With no 
regulations prohibiting monopolies, trusts or cartels, some 80% of 
Zimbabweâs 6,000 manufactured products were made under monopoly or 
oligopoly conditions (Deloitte & Touche, 1990, 4). Half the local output 
of Zimbabwean industries was produced by a single firm in each sector 
(and another 20% by two firms and 10% more by three). Hence, reported 
Ndlela (1984, 73), âNew applicants found it difficult to gain entry to 
the system in an effective way.â Chapter Seven shows Ndlelaâs complaint 
was particularly true in terms of entrepreneursâ access to the banking 
system.

Recall, too, that foreign ownership of the productive sectors â 
especially mining, but also manufacturing and agriculture â was central 
to ZANUâs anti-imperialist rhetoric during the 1970s. Yet it is 
important not to overplay the surface form of capital (its 
âforeignâ-ness) to the neglect of underlying dynamics of capital 
accumulation. The 1980s, after all, witnessed substantial foreign 
disinvestment (caused in part by inhospitable profit remittance 
regulations in the context of overaccumulated domestic markets).16 Even 
the World Bank (1989d, 2,63) commented, somewhat sheepishly, that âhigh 
expectations on new inflows would be inappropriate, even with a highly 
favourable (foreign investment) regime.â

Still, residual foreign ownership was not an insignificant phenomenon. 
In 1989, of 667 firms surveyed by Zimbabwe Institute for Development 
Studies researchers, 56% were still at least half owned by foreigners 
(accounting for 38% of manufacturing assets), and 21% of the firms were 
100% foreign-owned. Major clothing firms were entirely foreign-owned, 
while the ownership of the furniture and foodstuffs subsectors was 
approximately half foreign. Foreign ownership of manufacturing as a 
whole was dominated by Britain (54%), followed by South Africa (18%), 
the Netherlands (10%) and the United States (7%). The major firms in 
which multinational corporations held at least 51% equity included (in 
order of size of capitalization) Dunlop Zimbabwe, Delta Corporation, 
Triangle, David Whitehead Textiles, Lever Brothers, B.A.T. Zimbabwe, 
Zimbabwe Bata Shoe Company, Eastern Highlands Tea Estates, Lemco 
Zimbabwe, Metal Box Central Africa, and Plate Glass Industries. These 
eleven companies represented 30% of the total capitalization of the 667 
major manufacturing companies in Zimbabwe at that point (Maya and 
Tongoona, 1989).17 Though disinvestment was announced regularly, 
multinational corporate control of Zimbabwean manufacturing was still so 
widespread in the early 1990s that 40% of a Z$900 million African 
Development Bank loan package âlay idleâ because foreign-owned companies 
were initially ineligible (FG, 22/7/93).

The importance of attracting new foreign investment was even greater as 
a ruse used by domestic capitalists to express their own desires for a 
more friendly economic environment. First Merchant Bank chief economist 
John Robertson illustrates the relevance of even semantic symbolism: 
âWhen a foreign investor hears the word comrade, he leaves immediately. 
I do not believe that black Africans know how emotive the word isâ (FG, 
1/7/93). Yet the treatment of foreign investors was far more hospitable 
than ZANUâs rhetoric might suggest to the uninitiated. According to 
Ticharwa Masimba (1994, 4), mining magnate Algy Cluff invested Z$17 
million in Zimbabwe and then proceeded to raise Z$55 million on the 
Zimbabwe Stock Exchange in 1990 and another Z$25 million in 1992:


This money from the Zimbabwean public accounts for 80% of total 
injection and yet represents less than 20% of the ownership of the 
company. That is foreign investment for you. The company declared 
dividends of Z$98 million from 1990 on a thin dividend cover of 2,82% of 
the dividend, representing Z$80 million which has all been shipped back 
to Mr Cluff. In addition, the country has been forced to provide gold 
loans to the company of Z$150 million. If the government can do so much 
for one white man, it can surely afford to do the same for a black man 
who will inject the dividends back into the economy. It is sad â the 
matter is regarded as sensitive â precisely, because this is the way 
investors continue to drain the economy. The investment has been paid 
over and over again. What development did the country get from Mr Cluff? 
He has hardly put in any infrastructure.


Nevertheless, ZANUâs political alliances ensured that multinational 
corporations were never seriously threatened. As an example, in 1992, 
then-Commerce Minister Kangai praised Lonrhoâs Rowland for demonstrating 
that âMultinationals have and can become our economic ambassadors and 
promote, not just their own products but everyone else and all other 
goods produced hereâ (FG, 9/1/92).18 At the end of the day, governmentâs 
political perspective offered few substantive ideological obstacles to 
direct investment, although the payoff was minimal: the early 1990s 
witnessed no new takers aside from South African firms buying new 
subsidiaries (notably, banks such as Standard buying out Grindlays, and 
Nedbank taking a major stake in Merchant Bank of Central Africa) â and 
that thanks mainly to the rapidly-devaluing Zimbabwe dollar â and 
notoriously-fickle international mutual fund investments in the Zimbabwe 
Stock Exchange.

The underlying reason for the lack of new investment â multinational or 
local â can be traced to deeper tendencies of stagnation in the 
productive sectors of the economy. And these in turn meant that a 
decisive break with Rhodesian-era structural racism in business and 
banking would be extremely difficult.


The nationalist response to corporate racism


One reality of monopoly capitalism in Zimbabwe felt painfully by 
workers, junior managers and entrepreneurs is crucial to record: its 
racial bias. This was not absolute, as the case of powerful black 
financial elites makes clear (Chapter Seven). Nevertheless, as Brian 
Raftopoulos (1993, 7-8) argues,


It is not surprising that racial inequality has continued to be a 
problem in Zimbabwe. Put simply: the economic structures that produced 
and sustained a white elite are, in their essentials, still prevalent. 
It is equally unsurprising that opposition to this continued inequality 
should be coming not only from a state unable to meet the increasing 
demands of the majority of its citizens, but from fractions of the black 
petty-bourgeoisie unable to make their fortunes on a sustained basis. 
Having occupied the structures of political office, the board rooms of 
the private sector remain an area rarely dominated by anything 
approaching a black ânational bourgeoisie.â


The ceiling on the black petty bourgeoisie was, ironically, a function 
of continuing state programmes which in key sectors favoured white 
settler capital, according to Tom Ostergaard (1991, 24): âMoreover, 
while doing this, the Mugabe government has neglected â if not directly 
opposed â the development of a class of indigenous, black 
industrialists.â The reason for this paradox is that âthe governing 
groups reckoned that the well-being of the national economy and their 
personal livelihood depended on the continued success of the inherited 
industrial machinery.â Such sentiment was certainly dominant until, in 
the early 1990s, racial tensions again became more serious, as broader 
economic changes increased the desperation of an aspirant black business 
elite.

Throughout, a large proportion of white Zimbabwean businesspeople 
remained unabashedly racist, fomented anti-government cynicism (and 
charges of reverse racism), fostered a siege mentality (âWe are first 
class passengers on the Titanicâ was the favoured metaphor of a leading 
white professional), and fortified old boy networks wherever possible. 
As the CZIâs own (white) affirmative action consultant reported in 1989, 
âOne of the primary factors affecting the pace and nature of black 
advancement in industry is the racial attitude of white management. 
There is still white management at all levels that believes blacks are 
incompetent and cannot do the jobâ (cited in Raftopoulos, 1993, 10).

As in the early 1960s, post-independence nationalism was readily fuelled 
by the difficulties blacks faced breaking into â much less breaking up â 
the institutions of monopoly capital. The executive management of major 
firms remained more than 60% white through the 1980s (the CZI consultant 
conceded), and in effective control of the private sectorâs commanding 
heights. One study of 38 small-scale metal-working industries (most of 
which were founded after independence) showed that â34 (89%) were owned 
by Whites, four by Asians and `Coloureds,â and two by Blacksâ 
(Raftopoulos, 1991, 14). A Herald editorial (23/3/91) concluded: âIt is 
worrying that almost eleven years after independence and the banning of 
racial discrimination in Zimbabwe, there is still such a strong 
perceived need for an association grouping indigenous [black] 
businessmen... The largely hidden problem is the old boy networks.â

One answer was affirmative action, the essence of which was captured 
rather candidly by writer Nevanji Madanhire (1994, 28):


There is trepidation within the white community and over-excitement 
among black entrepreneurs. The former sees affirmative action as a 
threat and as racism in reverse, while the latter view the policy as 
offering new business opportunities. Now it emerges the policy was 
wrongly put across. As it is it will benefit only an upwardly mobile 
middle class and generates the view that those it helped would never 
have made it on their own. The policy is open to abuse and only a vocal 
and well-connected elite will benefit.


Another strategy for conclusively breaking the white networks was to 
establish a competing black old boy bloc. But to this end, the 
highly-touted Indigenous Business Development Centre (IBDC) developed 
serious problems nearly immediately after its founding in 1991. Founding 
member Leonard Nyamutsamba soon alleged that the IBDC was ârun by a 
cliqueâ without a constitution or treasurer. Soon, leading IBDC members 
were blacklisted by government for illegally reselling vehicles they 
received through a special IBDC allocation, while other members publicly 
alleged that the organisationâs leadership and government practiced 
favouritism in the allocations (FG, 19/9/91; Weekend Gazette, 13/12/91).

The split widened, leading to the formation of the Affirmative Action 
Group (AAG) in mid 1994 by the young entrepreneur Phillip Chiyanga, 
reportedly supported by disgruntled ex-leaders of the IBDC who had been 
voted out of office (Chiyanga spent Z$100,000 of his own funds on the 
AAG). Politicians like Didymus Mutasa took sides, and there was acrimony 
regarding the alleged purchase by IBDC secretary general Enock 
Kamushinda of Z$130 million worth of buildings in the Avenues and Kopje 
in late 1994. By 1995 Norwegian funders had withdrawn Z$14 million in 
IBDC funding as leadership squabbles continued. Chemist Siziba 
eventually defeated Ben Muchecheâs faction, after intervention by Vice 
President Joshua Nkomo (FG, 18/8/94, 8/12/94, 12/1/95, 2/2/95, 
15/12/95). In addition, a National Reconstruction and Development Board 
was initiated by intellectual leader Ibbo Mandaza to link black 
empowerment advocacy groups.

Ultimately, though, even without such distractions, the operations of 
black business organisations and nascent black-owned banks and companies 
were still mainly limited to the circulation of capital. The opening had 
come, in the immediate wake of independence, from black merchantsâ 
capacity to mop up the marginally increased effective demand (eg, as a 
result of the expansion of hire purchase lenders), especially through 
geographical expansion. And what with an expansion of government 
regional decentralisation initiatives, there were further opportunities 
for black petty-bourgeois accumulation in trade and commerce, since 
white-owned monopoly capital was far less interested in exploring new 
geographical outlets in the poorer rural areas.

But with most of the economy mired in stagnation during the 1980s, such 
meagre countervailing strategies could not break open significant niches 
within which black entrepreneurs could begin to accumulate. It was in 
part due to the CZI membersâ monopoly power and privileged access to 
resources, in part to the flood of imports in the early 1990s, and, as 
we shall see, in part to relentless overaccumulation tendencies, that 
the productive (especially manufacturing) circuit of the Zimbabwean 
economy remained essentially locked shut to potential black capitalists.


Stagnation in the productive economy


Until ESAP, the response by state and capital to the 1980s stagnation, 
as in the late 1970s, could be characterised as âmuddling through.â The 
main socio-economic principle seemed to be maintaining the existing 
economic structure intact so as to renew (and extend slightly downwards 
into the mass of potential black consumers) the trajectory of growth 
that was interrupted during the 1970s. As a US AID (1980, 10) report 
naively put it at independence, âThe countryâs unemployment problems 
date from the 1974 downturn in the economy.â According to this line of 
thinking, revival of growth would solve an unemployment crisis that 
stemmed, simply, from the 1974-78 economic collapse (not from decades of 
colonial-capitalist uneven development). Here it is worth returning to 
Sibandaâs (1985, 12) critique of the prevailing âdualistâ policy wisdom: 
âUnemployment is thus seen as the problem and not a consequence of or 
manifestation of a deeper and real problem.â

Stagnation in the key sector of the economy â manufacturing â 
essentially represented a continuation of crisis tendencies which had 
surfaced in the mid 1970s (Figure 6.1). Profits in all the productive 
sectors (manufacturing, mining and agriculture) were anaemic during most 
of the 1980s. Although agriculture experienced a healthy upturn when 
there were rainy seasons, most corporate profit rates were stagnant 
(manufacturing) or falling (mining and all other private sector firms). 
If we factor out the âunincorporated enterprisesâ (basically the several 
thousand commercial family farms), the decline in corporate profits as a 
percentage of GDP is startling (Figure 6.2). Improvements were witnessed 
in the years just prior to the implementation of ESAP, but as shown 
below these were not sustainable since they did not entail a resolution 
to the condition of overaccumulation.

Other aspects of the economy reflect the overall deterioration. Exports 
rose an average of 3.5% annually during the 1980s in local currency 
terms, but this was largely as a result of an erratic but significant 
devaluation of the Zimbabwe dollar, and was barely noticed given chronic 
balance-of-payments problems. As the private sector languished, 
government expenditure was increasingly responsible for Gross Domestic 
Product formation, though this occurred less in terms of traditional 
(and costly) civil engineering projects (which would have kept capital 
formation at respectable levels), and more in terms of recurrent 
expenditure, including straight income transfers.

The government deficit thus typically exceeded 10% of expenditures, as 
much as three fifths of which paid for interest due on past debt. 
Government debt repayment to foreign creditors rose from 4% of export 
earnings in 1980 to an excruciating peak of 35% in 1987, before falling 
off to around 20% at the time a fresh round of ESAP borrowing began in 
1990. Inflation averaged 15% during the 1980s, with nominal interest 
rates at 12%, yet the savings rate averaged a respectable 20% of income. 
Chapter Eight shows how in this context, dramatic speculative investment 
patterns emerged in the mid 1980s, while Chapters Nine and Ten 
demonstrate the uneven impact of debt on urban and rural development.

Underlying the generalised stagnation, by all accounts, was a lack of 
fixed investment. The World Bank (1991c, 5) attributed stagnation to 
âlow levels of investment in the productive sectors of the economy. 
Investment has probably not been adequate to maintain the capital stock, 
let alone increase it and raise productivity.â What the Bank would 
probably not concede is that this stemmed from the overinvestment of the 
mid 1970s and the skewed nature of effective demand in the economy. The 
Bank (1989, 44) noted that total new investment by corporations listed 
on the Zimbabwe Stock Exchange amounted to US$466 million from 1980-82, 
and just US$355 from 1983-87 (in 1980 prices).

As noted earlier, it was particularly difficult to attract multinational 
corporate investment. The African-American Institute and American Bar 
Association sponsored a conference on âInvestment in Zimbabweâ in New 
York City in early 1982, but of the many major corporations present at 
the conference19 only HJ Heinz Company made a high-profile new 
investment (in Olivine Holdings along with the government).20 In the 
wake of a global shift from direct foreign investment by multinationals 
in the 1950s and 1960s, to portfolio investment (loans and other 
credits) by banks in the 1970s, to a reverse net flow of funds from 
South to North in the 1980s, it was naive to think Zimbabwe could buck 
the trends. The reasons for lack of new multinational direct investment 
are varied. According to an unusually candid assessment by the World 
Bank (1989, iv,44),


Some observers emphasise low returns to multinational parent companies, 
the extensive government restrictions over decisions over most aspects 
of production and investment, and the high degree of political and 
economic uncertainty surrounding any new investment. Others point to 
high profits, a comfortably protected economic environment and the 
dearth of new investment inflows from parent companies, despite a stream 
of remittances. Both views have some truth in them... Perceived from the 
viewpoint of foreign-controlled companies, there is also an important 
element of strategic behaviour; thus their reluctance to invest may be 
seen as a strategic tactic intended to elicit more favourable terms and 
to establish a set of ground rules which would be more akin to their 
long-term interest.


And indeed, of industrialists active in Zimbabwe during the 1980s, the 
multinational corporations performed much worse in terms of reinvestment 
in plant and equipment than even the local industrialists (who are 
widely known to favour personal luxury consumption over and above a 
long-term commitment to Zimbabwean capitalism). The World Bank found 
that in the first three years after independence, investment by foreign 
companies totalled US$338 million (in 1980 dollars), while the following 
five years (1983-87) witnessed a mere US$191 million in new investments 
by foreign firms.

It would, however, have been unreasonable to expect foreign firms to 
invest in a stagnant economy when local producers were putting their 
surpluses elsewhere. Fixed capital expenditure across the manufacturing 
sector â still the motor of the economy, representing more than a 
quarter of GDP â was low because it had been so high a decade earlier, 
and because at the end of sanctions a minor burst of investment activity 
also took place which soon left markets saturated again.

The early post-independence moment of investment is worth brief 
consideration, for it confirms the most unstable trends in the 
productive circuit of capital. The upturn in manufacturing had actually 
begun about a year prior to the transfer of power, in mid 1979 (most 
accounts merely acknowledge 1980-81). Some subsectors of manufacturing â 
furniture and fixtures, for example â increased their net capital 
expenditure by nearly 500% from 1978 to 1979, and then doubled it again 
over the next two years. But this led to enormous increases in stocks, 
which exceeded the annual investments by a factor of at least four from 
1981 to 1984. Net capital expenditure in clothing also picked up by a 
factor of ten from 1977-78 to 1980-81, and this generated a doubling of 
inventory. The pattern was the same for footwear. In all of these cases 
during the early 1980s, consumer capacity was too quickly saturated, and 
export markets difficult to penetrate. Economist Rob Davies (1983, 7) 
reported âa large amount of excess capacity in Zimbabweâs industry at 
present. An increasing number of firms are going on to short-time etc., 
leaving plant and labour idle. In one sense therefore there is a lack of 
demand rather than excess demand in the economy.â

The overaccumulation problem was by no means evenly felt. Some light 
consumer good industries (especially food processing) continued to 
experience a steady expansion. Heavy investments continued in beer, wine 
and spirits, printing and publishing, meat processing, milling, dairy 
products, soft drinks and bakery products. But given persistent income 
inequality and the previously better-balanced nature of Zimbabweâs 
industrial base, the swelling of smallish food subsectors made little 
impact on macroeconomic growth. Capital goods appeared terminally weak.

Overall, the most important reflection of manufacturing investment 
inactivity was the existing low level of capacity utilisation 
experienced virtually across industry. While bottlenecks and shortages 
appeared periodically, and while the first two years of independence 
certainly witnessed large imports of foreign machinery to replace old 
equipment (although much of it was on tied-aid terms such as that of US 
AIDâs Commodity Import Program), overall there remained an excess of 
capital already invested in the manufacturing production process to 
realise a rate of return competitive with other investments. By the time 
the CZI began quarterly surveys in late 1984, capacity utilisation rates 
were down to 75%, and they fell to as low as 62% in 1987.

CZI membersâ capacity utilisation rates rose following the 1987 
downturn, in part because such extremely small amounts of money had been 
invested in equipment, plant and machinery throughout the Zimbabwe 
economy from 1985-88. With low levels of existing utilisation in the mid 
1980s, the perceived need for new capital investment had diminished even 
further, and remained very low (from 1985-88, according to official 
statistics, the rate of increase in gross fixed capital formation as a 
percentage of GDP averaged just 13%, one of the lowest on record, and 
well below fixed capital replacement rates). In real annual terms 
(measured in 1980 Z$), such investments amounted to only two thirds 
(around Z$200 million) of the amount invested in 1974 (R$325 million). 
In the manufacturing sector in particular, the entire investment in new 
plant and equipment amounted to just Z$60 million in 1986, and total 
fixed capital formation in manufacturing was just Z$116 million â as 
compared to total fixed capital formation in manufacturing of R$180 
million in 1975 (also 1980 Z$). Moreover, other outmoded plant and 
machinery had been taken off-stream at this stage.

The late 1980s finally witnessed a genuine recovery in the economy â to 
some degree due to good agricultural seasons â following an extremely 
bad period (1982-87) in which gross national income either declined or 
rose by less than 1.5% in five out of six years.21 There was, 
particularly, an expansion of real manufacturing output â 5.9% in 1989, 
6.1% in 1990 â in excess of growth of the economy as a whole (4.6% and 
2.2%, respectively). Although manufacturing grew by just 2.7% in 1991 
(against GDP growth of 4.3%), capital investment was by now picking up. 
Capacity utilisation and new investments had little choice but to show 
some improvement at this point, but it was too little too late. Although 
there was a substantial increase in manufacturersâ real fixed investment 
in 1989, it was only in 1990 that total real gross capital formation 
reached levels achieved from 1980-82, and these were still far short of 
the investments made back in 1974-75.22

Moreover, many companies leading the investment mini-boom â for example, 
the Z$1.5 billion sunk into textiles and Z$230 million into paper and 
packaging from 1990-93 were nearly all by the largest firms â regretted 
doing so, according to Sachikonye (1995a, 118), since it âresulted in 
huge financial exposures as interest rates soared above 40% in 1992 and 
early 1993.â Not only was investment financially burdensome for many 
large enterprises (industry leaders Cone Textiles and Hunyani packaging 
essentially went bankrupt), but government had then to be lobbied hard 
for the reimposition of protective tariffs against imported clothing, 
textiles and paper.

Moreover, few jobs accompanied the new investments. Even in commercial 
agriculture, which according to the World Bank (1995b, VII, 119) 
witnessed a real increase in fixed investment of 450% from 1985-91, the 
number of permanent commercial farmworkers rose from just 145,000 to 
155,000 during that period. The Bank (1995b, Vi, 6) argued that the 
excessively capital-intensive nature of the late 1980s investments was 
due to several factors:


foreign exchange was overvalued and depreciation expected, subsidised 
foreign exchange cover was provided, real interest rates were negative, 
foreign companies were forced either to reinvest or deposit blocked and 
surplus funds in accounts at 5% interest, corporate taxes were high 
(50%) and investors were allowed to immediately write-off 100% of 
investment cost from taxable income... The manufacturing sector uses 
capital very inefficiently and has a very high incremental capital to 
output ratio... Over the last few years, the capital productivity has 
been declining and labor productivity increasing, leaving overall 
productivity very low.


Thus despite becoming vastly more productive during the late 1980s, 
labourâs share of total output crashed from a high of nearly 20% in 1982 
to 14% a decade later. As a corollary, in relation to the earlier period 
of stagnation, manufacturing profitability was extremely impressive 
during the late 1980s (gross profit margins of 21% of sales, compared to 
15% from 1980-85), with firm earnings âmuch higher than the rate 
observed in developed countriesâ (World Bank, 1995b, VII, 121,123).

Yet the economyâs contradictions could not be suppressed for long. What 
with adding these new capital-intensive investments to a chronically 
overaccumulated economy, it would only be a matter of another few months 
(late 1991) before manufacturing again found itself the victim of 
massive overcapacity, plummeting investor confidence and the need for 
enormous downsizing. Exports were by this stage considered the only 
route open for manufacturing growth. But as shown in more detail in 
Chapter Twelve, rigorous marketing research had not been undertaken by 
exuberant boosters of liberalisation in the Finance Ministry and CZI, 
and in fact there was no reason to think that past failures would be 
reversed (Africa South, January 1991, May 1991, February 1992).

One result of âexport-led growthâ was a shift from healthy trade 
surpluses during the 1980s to mild trade deficits in 1989-90, which in 
turn exploded to untenable levels (more than 10% of GDP) beginning in 
early 1991. Another was, by 1993, the reappearance of enormous 
underutilised capacity in manufacturing. Indeed, reported the Bank 
(1995b, vII, 129-30), using existing equipment and modes of operation, 
firms could at that point still increase their output by an astonishing 
80% before hitting technical barriers: âThese numbers are dramatic as 
they do not incorporate stretching of capacity through extra shifts. 
However, it is not clear whether the firms in Zimbabwe will be capable 
of expanding, as it requires exporting and maintaining their shares in 
the domestic market in the face of increasing import competition.â

The continuation of a serious state of capital overaccumulation, even in 
the midst of a deeper devaluation process, is revisited in Chapter 
Twelve, but suffice to say the main subject of devaluation during the 
early 1990s was variable capital, ie the real wage. Yet in a world 
characterised by increasingly cheap labour, that would not be a 
substantial enough advantage to wrest Zimbabwe from its chronic problems 
of economic stagnation.


The alleged forex constraint


Finally, a perennial excuse for the economic stagnation of the 1980s was 
the alleged constraint to fixed investment that foreign exchange 
shortages represented. Indeed this shortcoming became the rallying cry 
for industrialists throughout the decade, allowing them to also account 
for the decline in production quality, consistency and output. Later, 
the need to earn forex became the primary rationale for switching 
emphasis from an internally-oriented manufacturing sector to one which 
would sink or swim based on international competitiveness.

Though the forex constraint requires debunking, it was not an entirely 
misleading hypothesis. There were, in the capital goods subsector, 
increasingly serious foreign import shortages, and some 30% of raw 
materials for manufacturing still had to be imported (although this 
ranged from just 2.5% in foodstuffs to more than 90% for some types of 
electrical machinery and transport equipment).23 Transport was first hit 
by a deficiency in foreign exchange, and a crisis in rail haulage 
capacity along with shortages of diesel and petrol reverberated 
throughout the economy (especially the agricultural markets) within a 
year of independence. Foreign currency allocations to manufacturers had 
been at near-record (real) levels in early 1981, but were then quickly 
halved in 1982 and 1983 largely as a result of the 1982 devaluation of 
the dollar and subsequent increases in import prices. In 1982 the CZI 
conducted a survey of manufacturers and concluded that âof the Z$942 
million capital investment envisaged for the sector under the three year 
Transitional National Development Plan, some 73% would consist of direct 
importsâ (Girdlestone, 1983, 8). The foreign currency crisis emerged in 
heavy industries, but created further bottlenecks which would be felt later.

As international prices for primary products failed to improve and 
manufacturing exports appeared stymied in the mid 1980s, a renewed 
urgency began to take hold. âThe most important single factor 
influencing manufacturing sector performance since 1980 has been the 
extent of availability of foreign exchange to import material inputs 
required to sustain production levels,â according to Chidzeroâs Ministry 
of Finance (Government of Zimbabwe, 1986, 133). And indeed the import 
content of investment in the existing stock of plant and machinery was 
about three times as high (in relative terms) as the import content of 
consumption expenditure such that under the prevailing circumstances, 
according to Davies (1986, 4), âraising the investment ratio would 
reduce consumption by more than it would raise capacity growth and would 
thus reduce GDP.â

Yet there is contrasting evidence to suggest that foreign exchange was 
not in fact the most crucial barrier to manufacturing fixed capital 
investment. For example, the Whitsun Foundation (1983, 124) reported in 
1983 that a high proportion of foreign exchange was âused for raw 
materials and spare parts, rather than for new capital equipment.â And 
fixed capital expenditure did improve in the late 1980s, when hard 
currency remained in short supply. Dan Ndlela (1984, 73) argues that 
even where foreign exchange was used for capital expenditures, âthere 
was no attempt to streamline allocations in such a way that priority 
branches of production could receive more in order to produce goods that 
would be key in the expansion of other sectors of the economy.â

Moreover, Zimbabweâs economic elite had regular access to foreign 
exchange for certain types of conspicuous luxury product consumption 
(which, if profits were to be had from higher levels of reinvestment, 
could have been redirected). Foreign currency was also squandered on 
capital flight, in unknown but probably significant amounts. What there 
was available could certainly have been allocated more rationally. In 
the wake of a 1990 banking scandal involving foreign exchange, a Member 
of Parliament, J.C. Kufandada (Hansard, 15/8/90, 1472), implored to his 
colleagues,


Now the question that has often begged the answer, which answer has not 
been forthcoming, is do we indeed have a genuine foreign currency 
problem in Zimbabwe or is it not a question of allocation?... I wonder 
how long it will take us to wake up and plug up all these loopholes to 
make sure that whatever monies we have will be legitimately used for the 
development of this country and not for those well-placed manipulatory 
thieves that would like to get this money out of the country for their 
own designs elsewhere.


Even Chidzero, when facing bitter complaints from industrialists that 
there was only 30% as much foreign exchange in the mid 1980s as in 1972, 
responded bluntly: âStatistics can be made to lie. During the UDI 
period, there was inventiveness and drive. Where is that drive today? 
The problem as I see it is one of identification. The industrialists are 
not identifying with the nationâ (Herald, 4/7/86).

This particular argument can be sustained only at a subjective level, 
yet the interests of a supposed ânational capitalist class,â as 
represented originally by the CZI (prior to the ascendance of a pro-ESAP 
faction), should be taken into consideration.24 Through most of the 
1980s the majority of domestic manufacturers were definitely not 
oriented to international markets (in terms of which they would have 
required cutting-edge imported capital goods and advanced technology), 
but on the contrary to protection from international competition 
(Riddell, 1983). In the early 1990s, the move to export-led growth 
justified industrialistsâ access to vast amounts of foreign exchange 
through the Open General Import License system.

Yet it is difficult to conclude that the renewed availability of hard 
currency on its own was responsible for increased fixed investment 
beyond late 1980s levels, given that much of the early 1990s borrowing 
was used instead as a means of stockpiling raw materials and 
speculating. And as interest rates soared to 8-10% in real terms in 
1991, and remained at this level over subsequent years, it also became 
clear that many domestic private sector borrowers of foreign capital 
were simply seeking lower interest rates for investments they would have 
made anyway.

In turn, the Zimbabwe Reserve Bank had guaranteed the lower cost of 
foreign debt by insulating such borrowers from the cost of repaying hard 
currency loans with their rapidly-declining local currency, through 
âforward coverâ protection. Zimbabwe taxpayers paid not only these 
direct costs (amounting to Z$2 billion in 1991 alone [World Bank, 1995b, 
vII, 21]), but also indirectly, in the form of a huge foreign debt whose 
servicing was certain to become extremely onerous again in the late 1990s.

In point of fact, a valid argument may be that it was not the lack of 
foreign exchange during the 1980s, but rather the surplus of foreign 
exchange in the wrong hands and wrong sectors of the economy, that most 
adversely affected the manufacturers. This is the argument of Dan Ndlela 
(1984, 72), who identifies in Zimbabwe what he terms a


âDutch diseaseâ because of the observed impact of the North Sea gas 
production on the Dutch economy. The strong export revenues from gas 
caused an appreciation of the Dutch guilder against other currencies 
which then exposed local industries to more intense foreign competition, 
causing unemployment. Large foreign aid inflows can be a special case of 
the âDutch disease.â Such large foreign aid inflows have in fact had 
similar effects on Egypt, as those generated by export revenues from 
cocoa on Ghanaâs economy, copper on Zambia and petroleum revenues on oil 
producing countries.

In the Zimbabwean case, the large inflows of foreign aid were likely to 
raise the price of inputs demanded by a certain sector (what we may call 
the booming sector) and initially increase the wages and salaries in 
this sector. In Zimbabwe, the booming sector was invariably the public 
sector at the beginning but it later on spread to other sectors. The 
other sectors that were likely to benefit directly from the boom were 
the services, utilities and transportation sectors... Thus the sector 
that stands to lose in this spending and resource movement effect is the 
manufacturing sector and in particular the still fragile 
heavy-industrial base of the economy, the capital goods sector.


Conclusion: Beyond stagnation?


In this chapter, an attempt has been made to paint the transition from 
Rhodesia to Zimbabwe in colours of continuity rather than change. 
Perhaps this has been best articulated by Cornelius Hoffman, a white 
(Afrikaner) commercial farmer who explained to New York Times journalist 
Joseph Lelyveld (1985, 368-369) that he now âhad a workersâ committee, 
linked to the [ZANU] party organisation, that had to give its approval 
before he could apply to the authorities to discharge an employee for 
cause. But the system worked smoothly and to his advantage... [Hoffman], 
far from grumbling about Marxist interference, as other whites were then 
doing, showed every sign of deriving a sportsmanâs satisfaction from his 
ability to play by the new rules.â

The ânewâ rules may have been flexible enough, but the economy wasnât. 
As in the mid and late 1970s, the problem of overaccumulation stood as 
the key constraint to both absolute growth and to a more balanced form 
of development during the 1980s. Neither ZANUâs ersatz socialist vision 
nor increasingly militant nationalist rhetoric confronted this reality 
effectively. It was, in the early 1990s, left to ESAP and its sponsors â 
international financiers and their local allies â to somewhat more 
conclusively break with certain of the traditions and institutions that 
were considered, by orthodox economists, to be most responsible for 
Zimbabweâs persistent stagnation. Yet as noted in Chapter Twelve, this 
process occurred in a manner that led to depression not revival. It also 
dramatically heightened unevenness and inequality.

Actually, ESAP was not as qualitative a break with the past as often 
claimed, for it was foreshadowed, we shall see in the next five 
chapters, by rising financial power and an increasing commitment to 
market-oriented social and economic policy. That the adoption of a 
market-oriented, âmodernisation theoryâ approach to development did 
nothing to cure stagnation was rarely considered.

Was there an inward-oriented, basic-needs alternative? The basic 
argument for moving along an export-oriented road was well-summarised by 
the CZI (1986, 17-19):


Zimbabwe has passed the âshallowâ stage of simply replacing formerly 
imported consumer goods. It is standing on the threshold of a deeper 
phase, in which equipment, intermediate goods, machine tools and 
processes are being designed, modified and manufactured for use in the 
manufacturing sector itself and other sectors such as agriculture, 
mining, energy and telecommunications... Within Zimbabweâs manufacturing 
sector there is a very elaborate and diverse system of linkages. At the 
level of its 33 subsectors, it is estimated that about 70% of all 
possible linkages within manufacturing are taking place.


But the CZIâs analysis accepts as a premise the structure of the economy 
â especially the skewed structure of effective demand â and in doing so 
begs three questions: first, what of the 30% more âpossible linkagesâ 
within manufacturing; second, what of the disproportionalities between 
capital goods and consumer goods that could conceivably be addressed 
with certain forms of state intervention; and third, what of the 
discrepancies between luxury and basic-needs consumer goods?

The last point in particular bears closer attention, since the potential 
for further âinward industrialisationâ along this path was substantial. 
For example, as shown in Chapter Nine, housing is a commodity that can 
be produced with very minor import costs in Zimbabwe. Had there been a 
more equal distribution of income and strategic targeting of government 
subsidies after independence, housing could easily have been the basis 
for a successful Keynesian âkick-startâ and antidote to stagnation. And 
thorough-going land reform (as well as proactive intervention in 
financial markets and industrial organisation) had been a key element of 
some East Asian industrialising countriesâ strategy for developing an 
internal class base for consumption of basic manufactured goods, and was 
occasionally suggested as the basis for inward-oriented capital 
accumulation (Robinson, 1988).

Such approaches would not have solved the deep-rooted industrial 
overaccumulation crisis, but would probably have delayed and dampened 
the crisis by combining the best tendencies of manufacturing growth in 
the early UDI period â the broadening of production, the closer 
articulation with local markets, the localisation of decision-making, 
and the control of financial markets that would make all the above 
feasible â with the post-independence âGrowth with Equityâ rhetoric of 
meeting democratically-determined basic needs. But to understand why 
such a strategy would not be pursued in Zimbabwe, no matter its manifold 
advantages, requires consideration of how financial power-brokers and 
processes operated within and outside the state (Chapter Seven), in 
speculative markets such as the Zimbabwe Stock Exchange and real estate 
(Chapter Eight), and in both urban areas (Chapter Nine) and rural 
settings (Chapter Ten). Only then can the devastation caused by 
international financial control of much policy-making in Zimbabwe 
(Chapter Eleven) â and specifically the imposition of ESAP (Chapter 
Twelve) â be understood from the perspective that there were indeed 
paths to less uneven development, even if these were never really 
terribly well-mapped, much less explored.

1. All statistics not otherwise cited are from Central Statistical 
Office, National Income and Expenditure Report and the CSO Quarterly 
Digest of Statistics and â even when somewhat dated â reflect the latest 
and most accurate figures available.

2. For critiques of the âpetty bourgeoisâ class character of the 
Zimbabwean liberation struggle see Yates (1980), Astrow (1983), and 
Sylvester (1990), and for an assessment of some of the more repressive 
aspects of the guerrilla strategy, see Kriger (1988).

3. See Martin and Johnson (1981), Lan (1985) and Ranger (1985).

4. Sender and Smith (1986, 133) conclude their analysis of African 
capitalist development with the contention that âIt is not a coincidence 
that working-class activity has been muffled by many post-Independence 
African governments in name of `unityâ or `African socialism,â since it 
is precisely from organised labour that such regimes have most to fear.â

5. Kangai, later the Minister of Industry and Commerce responsible for 
early implementation of the Economic Structural Adjustment Programme, 
and then Agriculture Minister during the 1990s land redistribution 
scandal, was also noted for plagiarising, word-for-word, paternalistic 
speeches of a former Rhodesian Front Labour Minister (Wood, 1988, 290-291).

6. The ZANU Youth League, for example, issued a statement following one 
incident which accused the students of being âlawless reactionary 
elements... misguided by enemies of our revolutionâ (Herald, 10/10/89). 
Shortly afterwards even Education Minister Fay Chung (one of the more 
serious of left intellectuals within ZANU) labelled the protesting 
students âneo-Nazisâ (Africa South, January 1990). For a full analysis 
of the initial round of conflict, see Ncube (1989, 324-328). Major 
outbreaks of violence and rioting occurred at the university in 
following years, grounded in generally progressive student critiques of 
various government policies.

7. In the same spirit, Ron Davies and Dewar (1989, 56) inexplicably 
found in Harare a âstrictly applied policy of severe containment of 
informal and squatter housing development (appropriate to socialist 
thought)â (sic).

8. The scandal involving Willowvale assembly plant car allocations was 
only the tip of the iceberg, but did have the effect of leading to five 
ministerial resignations in 1989.

9. John Saxby (1989, 79) offers this perceptive critique: âThere is 
little here by way of a materialist analysis (in terms of the social 
base of the nationalÂist movement, for example) to explain why an 
emergent petty-bourgeois class has secured power. Nor... does the reader 
have a sense of the possible trajecÂtories of social and political 
change.â Four exceptions to the rule within the SAPES circle were Sam 
Moyo, Brian Raftopoulos, Lloyd Sachikonye and Arnold Sibanda. See also 
Saulâs (1993) eloquent rebuttal to Mandazaâs charges.

10. What, then, was the reason for the failure of urban socialism in 
Zimbabwe? Davies and Dewar (1989, 43,52,55) argue that âThe productive 
capacity of the national economy is limited. Furthermore the state is 
constrained by the capitalist economy in the degree to which it may 
determine the redistribution of surplus value.â They also point to âa 
change of [state] actors, but not of fundamental structure,â to âongoing 
development momentum in existing new self-help, ultra-low cost home 
ownership schemesâ as well as to recalcitrant colonial city officials 
and U.S. Agency for International Development guidelines. But the actual 
accumulation process (including the role of the state), as discussed in 
this and following chapters, is absent from their account. Like Teedon 
and Drakakis-Smith, Dewar (1987, 24-26) also cites, as constraints to 
socialism, the prioritisation of rural over urban development, 
overambitious black expectations, the âdifficulty in breaking the 
patterns of people historically engaged in survivalist strategies,â and 
the risk to Zimbabweâs economic infrastructure.

11. But as Sachikonye (1995b, 182) points out (and as is elaborated in 
the next chapter), âThe proliferation of state development corporations 
should not be viewed as an altruistic strategy of the newly-installed 
state bourgeoisie to limit or pre-empt the expansion of the private 
sector. It can be interpreted as a conscious attempt by the state-based 
bourgeoisie to carve a niche for itself for its own accumulation 
requirements.â

12. One exception may have been DeBeers, which following conflicts with 
the Minerals Marketing Corporation of Zimbabwe â DeBeers insisted on 
imposing its Central Selling Organisation diamond cartel arrangement â 
was encouraged to leave. However in 1993 Mines Minister Eddison Zvobgo 
invited DeBeers back (FG, 28/10/93).

13. As examples of corporate influence, the CZI claimed successes in 
lobbying for removal of parastatal subsidies (and eventual 
privatisation); reduction in the size of the civil service; upgrading of 
the Zimbabwe Investment Centre; a variety of government assistance in 
export markets; and reductions in taxes (The Industrialist, October 1991).

14. âIt is important to note that socialist countries have also had 
structural adjustment,â rationalised the irrepressible Chung (Sunday 
Mail, 16/12/90):

Structural adjustment can therefore be utilised to strengthen socialism. 
It can also be utilised to strengthen capitalism. It very much depends 
on whether the belt-tightening is for the benefit of the people; for the 
benefit of capitalists who will use the accumulated wealth to develop 
the country; or for the benefit of capitalists who aim to expatriate the 
wealth without developing the country. All three possibilities are there 
today.

15. ZISCO is emblematic of failed state enterprise, as it suffered 
marketing problems, rising transport costs and bottlenecks, unfavourable 
export prices, a flight of skilled labour, and a shortage of foreign 
exchange for key inputs. As a result, government subsidies increased 
from Z$20 million in 1982-83 to Z$100 million two years later 
(Government of Zimbabwe, 1986, 138). ZISCOâs early 1990s crisis was 
based largely on three factors: massive overcapacity (amounting to 50% 
of production); suicidal attempts to engage in what ZISCOâs managing 
director termed âcut throat price competitionâ on the declining 
international markets (which the government demanded, for the sake of 
earning foreign currency); and debt financing which ate up 8% of gross 
sales revenue in 1990. The result was a loss of Z$675 million in the 
year ending in mid 1991, which in turn sparked renewed calls for ZISCOâs 
privatisation. By 1994 ZISCO had been shut down after losses continued 
to mount, as even efforts to refurbish through Chinese suppliers came to 
naught.

16. For a list and case study analysis of disinvestment â though 
thoroughly misleading conclusions â see Zinyama (1989).

17. However, a study released simultaneously by the CZIâs chief 
economist defined foreign ownership as 50% or more of equity, and found 
that only 141 out of 550 large manufacturing companies (26%) were 
foreign-owned. This compared with 48% surveyed in 1987 and 52% in 1985. 
Humphrey (1989, 4) explains that âsince early 1987 there have been a 
number of localisations of large previously foreign owned companies.â In 
1991, the CZI updated the survey, and found that the foreign ownership 
figure had declined to 23%. Of 105 foreign-owned firms (out of 516 
surveyed), 58 had annual turnover in excess of Z$12.8 million, which 
accounted for 33% of the 174 total firms in this latter category (The 
Industrialist, November 1991). There is no obvious reconciliation of the 
ZIDS and CZI findings.

18. For an analysis of Lonrho that spells out in more detail personal 
relations between Rowland and Zimbabwe government leaders, see Hall 
(1989). Lonrho spokesperson Paul Spicer explained the dynamics openly: 
âOur relations with governments are very good. Our investments are very 
substantial, and if I have to put it like that, we get preferential 
treatment. If youâve got muscle you can talk to the government and come 
to an understanding. Small people canât do thatâ (South, October 1988).

19. These included Leon Tempelsman and Son, Johnson and Johnson 
International, Ford Motor, Caltex, Xerox, Westinghouse, Ingersoll-Rand 
Company, Mobil, NCR Corporation, General Motors, Goodyear, Union Carbide 
Southern Africa, and PepsiCo.

20. Of note is the fact that OâReilly is âpleased with our Zimbabwe 
investment in every respect,â and that Zimbabwe profits and 
remittability compare favourably with other Heinz operations worldwide 
(Lowe-Morna, 1989, 34).

21. As a reflection of the (inflation-adjusted, Z$1980) effective demand 
shrinkage over this period, private final consumption expenditure, which 
had reached Z$382 per capita in 1983, sunk to Z$226 in 1987, a decline 
of 41%.

22. In 1995, the World Bank (1995b, vII, 118-121) reported a remarkable 
rise in gross fixed capital formation, allegedly beginning in 1985 and 
proceeding at âa real rate of 20% per annum. The increase in investment 
has been quite broad based with all sectors experiencing a significant 
increase; most of the investment has been in plant, machinery and 
vehicles and not so much in buildings.â In particular, private sector 
fixed investment apparently rose from a low of 9.4% of GDP in 1983 to a 
high of 20.6% in 1991, according to the Bank. But the new finding â a 
deluge of (non-building) investment during the stagnant pre-ESAP period 
â is counterintuitive. It contradicts both the Bankâs (eg, 1989, 1992) 
own earlier reports on manufacturing cited above â a 1992 Bank study 
openly argued that the lack of fixed capital investment was the 
âprincipal cause of Zimbabweâs modest economic growthâ (FG, 29/1/93) â 
and data from the CSOâs Census of Industrial Production, which recorded 
an enormous real decline (not increase, as the Bank claims) in real 
investment during 1992. The Bankâs response (1995b, vII, 120) was that 
the CSO numbers âseriously underestimateâ the investment âsurge,â but 
it 
offers no explanation of how or why. This issue is revisited in Chapters 
Eight and Twelve.

23. Other subsectors where the import content was less than 5% in the 
early 1980s included cement (5%), machinery for mines (3%), plumbing and 
irrigation equipment (5%), cables (2%), and tissue paper (2%). 
Subsectors which had extremely high levels of import content included 
pesticides and insecticides (90%), aluminum extrusion for the building 
industry (90%), moulding for plastics (100%), televisions and radios 
(80-100%), trailer axles (98%), rubber products (95%), ball pens (90%), 
and carpets (98%) (Government of Zimbabwe, 1986, 139-41).

24. There is reason to doubt the value of an ascription like ânational 
capitalâ in view of the fact that over time, foreign ownership of the 
Zimbabwean manufacturing sector declined, whereas the orientation of the 
CZI moved progressively towards international markets. The difference is 
observed, for example, in the approaches of two different CZI chief 
economists, namely Roger Riddellâs unbridled hostility to the World Bank 
in the mid 1980s, as compared to Mike Humphreyâs early 1990s fawning 
over ESAP.



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