The new president of Zimbabwe Emerson Mnangagwa has promised the people of Zimbabwe that his priority is reviving the economic fortunes of the country. He has committed his new administration to end the years of economic isolation by declaring Zimbabwe “open for business”.
He has his work cut out. While Zimbabwe’s long-term growth prospects are considered positive in terms of its human capital and natural resources, its current economic situation is highly precarious. The era of hyperinflation and economic mismanagement has seen the economy halve in size since the turn of the century. The country’s industrial base has been eroded, prompting a rapid expansion of the informal sector, where livelihoods are characterised by low wages (indeed many jobs are not paid at all), weak productivity and poor working conditions. The country is chronically indebted and expansionary fiscal policy in recent years has provoked a serious credit shortage and liquidity crisis that is stifling growth.
Tackling this economic malaise will require policy change on several levels, enacted in the short-, medium- and long-term. Not only is the scale of the challenge substantial but following the events that led to the change in power, public expectations for change are very (often unrealistically) high. The euphoria that spilled onto the streets in November 2017 reflects the fact the people of Zimbabwe are eager to see their country develop.
President Mnangagwa recognises the need to respond to public demands for economic improvement ahead of the election later this year. Hence the flurry of activity in his first 100 days which have been characterised by the promise of action, the implementation of some early initiatives, and a concerted effort to drum up foreign investment.
The purpose of this study is to present an initial snapshot of what ordinary Zimbabweans think about their own economic prospects and that of their community 100 days into the new government. How are they coping? Are there early signs that things are improving, or is it more a case of business as usual? Are they optimistic about their future or do they fear little will really change? Do ordinary Zimbabweans believe they will benefit from potential economic growth, or are they concerned they will once again be left behind? Is government policy focused on issues that resonate with ordinary Zimbabweans – are policies addressing the issues that matter to them? Are there signs that government policy will heal the deep divisions in Zimbabwe, or do people think the “new dispensation” is likely to continue with the old politics?
These are obviously big questions and we do not claim this study can answer them comprehensively so early in the life of the new government. Moreover, we fully appreciate that opinions of the people we spoke to will be shaped by their own longstanding economic circumstances and their experiences of the previous administration, as much as by their view of the new government.
Acknowledging these caveats our aim has been (i) to try and capture the current mood of ordinary Zimbabweans in respect of their own livelihoods shortly after a major moment of political change, and (ii) provide a very early assessment of how ordinary Zimbabweans think about the new government’s performance on the economy.
What we did
The study is based on ten Focus Group Discussions (FGDs) and 20 supplementary interviews, which were held in five study sites in Zimbabwe, carried out in the final week of the new government’s first 100 days. FGDs (and supplementary interviews) were selected as the most appropriate method for quickly gathering data on the mood and perceptions of ordinary Zimbabweans on a range of economic issues. While focus groups are not based on a representative sample of the population, and thus do not allow us to extrapolate wider trends from the population, they are an effective way of providing insights into how people understand and experience their own economic circumstances.
FGDs, averaging 8-15 participants each, covered a cross section of 6 Urban/Peri-Urban and 4 rural sites in Harare, Mutare, Masvingo, Kwekwe and Bulawayo. The sampling targeted people working in the informal sector, which accounts for around 90% of the Zimbabwean economy. In urban and peri-urban areas we sampled young entrepreneurs; small and medium sized enterprises (SME); and microenterprises, including vendors and traders. In rural areas we sampled small-scale farmers, general dealers and traders. One FGD was comprised solely of women, and two solely of young people.
What we found
Below we summarise the key themes we heard from the focus groups and interviews.
3.1 As reality bites is the honeymoon over?
One hundred days in and the euphoria that greeted the change in political leadership has been replaced with a growing frustration at the slow pace of change. While it is too early meaningfully to judge the new government’s stewardship of the economy, it is nonetheless striking that few Zimbabweans we spoke to report any improvement in their livelihoods (one important exception concerns the removal of road blocks discussed below). A recurrent theme we came across is the desire for warm – and welcome – words to be backed with some tangible improvements, however small, in people’s everyday lives.
Reality biting is hardly surprising given the scale of the challenges the country faces, and the struggle with which so many ordinary Zimbabweans grapple in their day-to-day lives. The question facing Zimbabweans, many of whom have that morning-after-the-night-before feeling, is how their own economic situation will shape the way they feel about the new government. Will most Zimbabweans retain faith in the new government, but just become more realistic about what is possible: will they become “cautious realists”? Or will they lose faith and become “out and out pessimists”? It is too early to say which response will prevail, but our study shows both strands of thinking are already evident.
Many of the Zimbabweans we spoke to are still willing to give the new government the benefit of the doubt. While few respondents reported any noticeable improvement in their own economic situation, several remained hopeful that things would get better in the future.“We look forward to light at the end of the tunnel” said a male artisanal miner in Kwekwe. Yet this optimism was certainly tempered by a sense of realism. The cautious realist view was well captured by a young man in Bulawayo who spoke allegorically, when he said: “The current situation in Zimbabwe can be likened to a pregnant woman; she can either successfully deliver her newborn baby or have a stillborn.” For many the jury is still out.
For a significant minority, however, pessimism has started to set in. “Nothing has changed. It is only the driver that changed, it’s still the same bus” (Female, Fruit and Vegetable Vendor, Mutare). That this sentiment has taken hold so soon should be of potential concern to the government. This pessimistic account is especially strong in relation to perceptions about political cronyism (see section 3.4 below).
Overall, we found that Zimbabweans we spoke to have recalibrated their expectations about the likely scale and pace of change. “It will probably take up to 2-3 years to start seeing real change if the right kind of efforts are made now”(Small Soft Beverage Manufacturer, Mutare). While respondents recognise that change won’t happen overnight, they nonetheless need reassurance that things are heading in the right direction. Based on our initial assessment it appears the government could to do more to reassure. As one woman vendor operating at Chitima Market in Masvingo put it:
“When the government changed, we had hoped for change, but now we are confused. We don’t know whether we are still heading in the right direction”
3.2 Life remains very tough for the vast majority of Zimbabweans
What is difficult to disentangle is the extent to which the more cautiously realistic mood we encountered is principally down to respondents reiterating long-standing concerns about the challenges of life in Zimbabwe; or whether it is based on the perceived shortcomings of the new government. Inevitably respondents conflated both in their reflections.
There was, however, little ambiguity when we asked people about their own economic situation. A clear majority reported that nothing had changed for the better: their primary concern remained one of survival. The economic activities that they were engaged in were highly precarious and operated on a hand-to-mouth basis.
Surviving in an informal economy often meant moving from one ‘job’ to another, with no single and clearly defined source of livelihood. As noted by one respondent in Mutare:
“If something crops up that gives more income all the youth … hurry to join the new gold rush. There is no specific business and long-term investment in growing any sort of business, it is about survival.”
Most respondents struggled to make ends meet. A majority acknowledged they live below the poverty line. Food security is a major concern for the people we spoke to. As one Kwekwe parent told us:
“While I may forgive myself for not having money in my pocket for other daily expenses, what my conscience cannot deal with is not being able to put food on the table for my family or dependents. This for me is the most humiliating experience a father or breadwinner could ever face. All we want is to be able to take care of our families and provide for their basic minimums, is that too much to ask?”
Our study confirmed the strong gender dimension to poverty. A woman trader from Chitima Market said: “it is tough especially for women as we are hardly ever given a chance. I am a single mother with 4 children to look after and I need a job”. We also heard how women and young girls are additionally vulnerable to sexual exploitation and violence in their search for economic opportunities.
3.3 Ordinary Zimbabweans are frustrated at the lack of change
Reviving the Zimbabwean economy is undoubtedly a herculean task. Nonetheless the new government is under pressure ahead of the election both to deliver some quick wins for Zimbabweans – the low hanging fruit of economic reform – and, more importantly, reassure voters that the new government is capable of change and is steering the country in the right direction.
Yet we found little evidence to suggest the new government’s current policies are especially popular with respondents. Indeed, some policies appear to be unpopular, such as the treatment of vendors (see 3.3.4 below). And the government’s approach to foreign investment provokes suspicion (see 3.3.5 below).This is not to suggest naively that elections in Zimbabwe are won and lost on the efficacy of policy alone, but for a president who is not perceived to be a natural “change candidate”, it is at least arguable that he would benefit from having policies which visibly give effect to his otherwise popular political narrative.
Discussants distinguished between four broad experiences of government economic policy: (i) the low hanging fruit – the small changes that have had an immediate and positive impact on livelihoods (the only example raised was the removal of road blocks); (ii) areas where insufficient progress has been made (the cost of living, cash shortages, and the business environment); (iii) policies that are unpopular – the key example here is the treatment of informal traders and vendors; and (iv) policies that arouse suspicion – here we discus foreign investment.
3.3.1 The low hanging fruit: the removal of roadblocks resonates strongly but is the exception to the rule
The one concrete example of a popular policy that clearly resonates with our respondents, and which has delivered a tangible improvement in everyday lives, is the removal of police road blocks. A number spoke of their immense relief at no longer having to pay bribes to abusive police officers. As one mini-bus operator told us:
“I used to budget $10 a day to pay bribes so we could operate our routes and stop my driver and his conductor getting harrassed. To make you understand, $10 is slightly more than what we gross for a trip into town with passengers. To us such losses are significant and very difficult to recover. It’s a relief therefore that these rogue officers have been reigned in”.
The removal of road blocks proved to be the exception to the rule. When pressed respondents could not think of other government policies which have had a similar positive impact on everyday lives. Discussants pointed to lifting regulations on small firms as potential other ‘quick wins’ the government could introduce to deliver demonstrable improvements (see 3.3.3).
Insufficient progress: addressing the cost of living and cash shortage
Across a wide range of other policy areas our respondents expressed concern that insufficient progress has been made. On the cost of living respondents acknowledged some effort by the government to ease pressures, for instance through marginally reducing the cost of fuel, but overall this is an area where ordinary Zimbabweans believe more action is needed:“the struggle continues, prices of basic commodities are already out of reach of many and the changes do not seem to be happening fast enough” (Male vendor, Harare). Price stabilisation was a key priority respondents wanted the government to address urgently. As one woman we spoke to in Bulawayo said:
“…we had thought with the new dispensation prices would stabilise, but by end of December we could not even afford the basics that our families required. Things seem to be getting worse and I don’t know what we will do to take care of our families as the little we get gradually means nothing due to these unstable exchange rates.”
Respondents spoke of the adverse effect cash restrictions have on their livelihoods. Vendors and traders are hit particularly hard: they tend to get paid in bond notes or Ecocash but have to pay their suppliers in US dollars, exposing themselves to serious exchange rate risk.
“Where we order, they don’t want Ecocash. They want cash. We end up buying money from money changers. This affects us greatly and most of us end up being broke.”(General trader, Masvingo)
Scarcity of cash is also blamed on corruption with politicians and party officials popularly perceived to be “hoarding cash”. Another significant factor is the lack confidence in the banks: our respondents said they fear they won’t be able to get their money out if they deposit it in banks. Boosting confidence in banking was identified by our respondents as something that needs quickly to be addressed.
3.3.2 Insufficient progress: doing business has yet to get any easier
We asked small business figures, informal traders, farmers, and young entrepreneurs about the ‘ease of doing business’ in Zimbabwe. Three key points emerged: the first is that many, especially the young, lament the bureaucratic barriers that continue to inhibit doing business in Zimbabwe. As one young entrepreneur in Harare put it:
“government departments are full of dinosaur leaderswho are still into the traditional way of doing business. It is so frustrating to have to rely on them to provide essential services for us young, tech-savvy and generally efficiency-hungry entrepreneurs. The Zimbabwean government should prioritise reforms like e-procurement to enhance its operations. Bureaucracy is a multinational disease that we should fight against as a country”
Second is a concern that the new government’s ‘Ease of Doing Business’ agenda, while welcome, is insufficiently focused on removing the bottlenecks impeding the growth of small Zimbabwean businesses. Respondents felt government policy was more concerned with improving the business environment for big business and foreign investment than in dealing with the informal sector. Indeed, some believed it was easier for foreign firms to do business in Zimbabwe than local businesses (see also section 3.3.5) as the foreign firms were not subjected to the same regulatory burden (or if they are, they are more easily able to ignore it).
The third theme raised by small businesses was that while improving the overall business environment is difficult, there are plenty of quick win reforms the government could enact to help remove red tape. Examples cited include rationalising statutory obligations and regulation fees.
3.3.3 Unpopular: Government treatment of vendors and traders shows a lack of empathy for ordinary Zimbabwean livelihoods
The new government continues to insist that vendors should relocate to designated sites, which vendors say are too far from their customers thus preventing them from earning a living. Vendors we spoke to felt strongly that they are being treated unfairly and denied the opportunity to improve their economic circumstances. This is compounded by the belief that vending sites continue to be heavily controlled by party officials (see 3.4).
Focus groups in Mutare and Masvingo also complained that the removal of vendors from the streets negatively affected the livelihoods not only of vendors but of the wider community: “some of the people who were removed from the streets by the new government were our customers and this has reduced our sales” (Female, Mutare).
Tension between government and traders is a long-standing problem and illustrates the apparent mismatch between government policy which aspires to expand the formal sector, and the reality facing many Zimbabweans who depend now and for the foreseeable future on the informal economy to earn a living.
Whatever the merits of the policy, the continued removal of vendors and traders from streets was cited by our respondents – both vendors and non-vendors – as symptomatic of the government’s insufficient understanding of the reality of ordinary life in Zimbabwe. Moreover, this lack of empathy is considered a contributory factor behind the waning optimism in the new government.
3.3.4 Arouse suspicion: For the few not the many? Zimbabweans are concerned foreign investment will not lead to inclusive growth
Our respondents were suspicious that local Zimbabwean businesses could potentially lose out from foreign investment. This suggests a potential tension with the new government’s “open for business” policy. The new president has gone on a charm offensive to woo foreign investors and has sought to remove barriers to investment through the partial reform of the country’s indigenisation and economic empowerment law.
However, local entrepreneurs are concerned they will not be able to compete on a level playing field and called for measures to protect Zimbabwean businesses. They spoke about the danger of being “emasculated”by an influx of foreign companies. “Wewill never survive as entrepreneurs in this country if there is no protection of businesses that locals can exclusively embark on without being out-competed by foreigners who have more financial muscle than us” (male entrepreneur, Harare).This view was echoed by a small business person in Bulawayo:
‘Hapana chedu apa [there is nothing for us] as long as government does not regulate the type of investment getting into the country to make sure foreign companies don’t violate labour rights or don’t encroach in sectors where ordinary citizens have been trying to earn an honest living out of in such difficult circumstances.
A number complained that some foreign firms were circumventing regulations once they had been authorised to operate in ‘reserved’ economic sectors. Chinese firms were singled out as the main culprits, with questions raised about their poor labour market practices and their failure to employ local labour. The perceived lack of skills and technology transfer from these foreign firms to locals left many wondering what Zimbabwe really gained from such external investment.
This is not to say our respondents are against foreign investment per se. They understand the positive role it can play to help stabilise the macroeconomy. Their real concern is with foreign firms that set up and unfairly compete with them locally: “It would be ideal if foreign investment could focus on supporting higher level mass production and more complex manufacturing that need high levels of capital, and not rivalling us by setting up small shops and even making sadza” (male, fast food vendor, Bulawayo).
Above all respondents expressed concern that while investment is undoubtedly needed for the country, unless measures are put in place to protect local Zimbabweans businesses, then they risk missing out on the fruits of any potential economic growth. “If foreign investment creates jobs and grows the economy, then yes it should be welcome with open hands, but not if it increases our suffering” (male, young technology entrepreneur, Bulawayo).
3.4 Political cronyism and the limits of the “One Zimbabwe” narrative
One major lingering problem of the past and a major source of division in Zimbabwe is political cronyism – the belief that only the politically aligned and well connected can prosper. The new president has promised to heal such divisions, with his championing of a Zimbabwe “of all citizens regardless of colour, creed, religion, tribe, totem or political affiliation”.
Yet a number of people we spoke to said that political cronyism continues uninterrupted under the new government. Respondents complained that access to resources, government programmes, and economic opportunities are often prioritised for supporters of the ruling party. The sense of frustration that Zimbabweans we spoke to feel about this was palpable.
Respondents were generally of the view that patronage and cronyism are inherent in Zimbabwean economic and political structures and very difficult to eradicate. Urban traders in Mutare, for instance, complained that government funding schemes for SMEs were not distributed fairly. While a number of the popular vending sites and markets were still reportedly controlled by ruling party activists. In rural areas farmers said party connections were the key for accessing input subsidy programmes, support for cash crops and food aid.
“I think the challenge is there is no clear distinction between government and ruling party programmes, so the political actors don’t know where to start and where to end in terms of exerting their political influence in community development programmes. Even the officials implementing government programmes often make themselves subservient to ruling party cadres, and that affects who benefits from government programmes and who doesn’t” (Male, rural trader, Masvingo).
If anything, the situation is more pronounced for small scale and artisanal mining. Artisanal miners in Kwekwe, lamented the ubiquitous presence and influence of ruling party ‘strongmen’ in their operations. As one respondent observed:
“We work for almost nothing because of these ruling party thugs who collect rents and bribes from us in the form of protection fees … Our lives have become more complicated because of the growing influence of rogue and unscrupulous soldiers that at times take away every ounce of gold that we have found” (female, artisanal miner, Kwekwe).
Overall, respondents were concerned that so long as there was no effort to deal decisively with cronyism and the patronage system, the benefits of future growth would not be shared fairly.
3.5 Concerns about corruption
Respondents identified corruption as a major threat to economic recovery in Zimbabwe. “[Corruption] is a cancer consuming the Zimbabwean fabric and has become part of the culture of doing business”said a young female entrepreneur in Harare. The president’s pronouncement of ‘zero tolerance to corruption’ was therefore welcomed by focus group discussants. The decision to remove road blocks and the police corruption that came with it was a very clear expression of this policy, which has proved to be very popular with citizens. However, the ultimate test of the government’s commitment to tackling corruption would be how it addressed high level corruption involving senior politicians and bureaucrats. Respondents also said it is important that the fight against corruption is not used as a means to target political rivals by those in power. As an informal trader in Bulawayo commented:
“We will only start taking the government seriously when the fight against corruption ceases to be partisan and when investigations lead to arrests and the recovery of loot stolen from our country.”
3.6 Zimbabweans want to help build the new Zimbabwe
A theme that came out strongly in the study is a willingness for ordinary Zimbabweans to play their part in helping build the ‘new Zimbabwe’. The people we spoke to recognise the need for a collective and concerted effort to address the very real challenges facing the country. They do not believe reviving the economy is the responsibility of the government alone. Artisanal and small-scale miners, for instance, were eager to contribute:“we are more than ready to do our bit to boost gold production.” But significantly, the Zimbabweans we spoke to do believe government needs to enablechange by: removing barriers to growth and ensuring that economic opportunities are distributed fairly, not just for the privileged elite. Young people were desperate to be given a chance and as discussed above they lamented the way bureaucracy stifles entrepreneurship. Overall, respondents expressed a desire for government to consult and engage ordinary Zimbabweans more effectively in the process of change. An example concerns efforts to regularise the informal sector, where discussants felt that government could do more, when developing policy, to reflect the everyday circumstances of citizens.
This short study attempts to provide a snap shot of how ordinary Zimbabweans think about their own economic prospects and that of the country more generally, shortly after a period of political change. It also presents an initial and therefore cursory assessment of the new government’s stewardship of the economy.
In summary we find that the euphoria that greeted the political transition last November has been tempered by the fact that few Zimbabweans have seen any tangible improvements in their livelihoods. Amongst our discussants we identified two broad groups: the first, who make up the majority, are the cautious realists who recognise that change will take time and are, for now at least, prepared to give the new government the benefit of the doubt. The second, are the pessimists, a significant minority, who increasingly question whether the new government will be any different to the previous regime.
If a growth in pessimism is to be reversed, then our study suggests the government should consider the following:
- First, enact some ‘quick wins’ that deliver meaningful improvements in people’s everyday lives. The removal of road blocks demonstrates how a relatively minor change can make a big difference to livelihoods. A focus on ‘bread and butter’ measures would also help reassure citizens the country is on the right path, however long the journey might be.
- Second work to ensure that policy initiatives better reflect the priorities of ordinary citizens. Our respondents felt government policy – from the treatment of the informal sector to approaches to the business environment – was not sufficiently informed by the reality of ordinary life in Zimbabwe.
- Finally, allay fears that as the economy revives, the fruits of economic growth will be for the many and not the few.