Gary van Staden | NKC African Economics
President Emmerson Mnangagwa has predictably received a warm welcome at the World Economic Forum (WEF) gathering in Davos. The European Union (EU) became the latest multilateral institution to pledge support for the new dispensation in Harare.
However, like his neighbours in South Africa, he should be aware that foreign donors are watching for delivery and walking the talk.
The sudden and rapid developments in Zimbabwe late last year, which saw the military essentially remove former President Robert Mugabe and subsequently elevate Mr Mnangagwa to the top post, have ushered in a new opportunity for the country to achieve its economic potential as a powerhouse in the region.
Harare sources have said that the reception in Davos has been “very encouraging” and that some short-term progress in outside assistance was in the pipeline, but that the medium- to longer-term prognosis was a little trickier.
These sources offer several reasons for the reluctance of the international financial community to take Mr Mnangagwa at his word, including: his alleged role in atrocities in the 1980s that has never been satisfactorily resolved, the frequent false dawns produced by the Mugabe administration that always failed to materialise, and the potential for pushback among Mugabe loyalists in the ruling Zanu-PF.
The clear message to Mr Mnangagwa seems to be: “show us the change and we will show you the money.”
Those present at Davos who have serious agendas, will seek out Mr Mnangagwa to probe more deeply the prospects for significant political and economic reform and no doubt the president will have some of the answers they seek.
But caution will be mixed with the warm reception the Zimbabwe delegation receives due to the forthcoming elections.
Elections in the country have not been entirely free and fair for close on 20 years and in some cases, such as in 2008, were blatantly stolen. The behaviour of Zanu-PF, the security establishment and State institutions charged with running the elections due in a few months’ time are going to have be, if not above reproach, then at least good enough for Western governments to be able to endorse the outcome.
We believe Zanu-PF will lay off the institutionalised rigging and intimidation and try to run a free and fair poll – then foreign interest in the country will surge.
Those with a higher appetite for risk may not wait for the elections, and we will begin to see a serious uptick in foreign interest before the elections. However, the big money will probably take a more cautious approach even though by waiting they may have to pay a premium.
The Bretton Woods institutions and other multilateral organisations would probably engage relatively quickly.
It is apparent that Davos and the opportunities such a gathering presents will provide Zimbabwe with a platform it has shunned for two decades and, generally, its presence will be widely welcomed. But the mantra may be ‘action speaks louder than words’ and the Mnangagwa administration faces its first real test when elections fall due later this year.
Mr Mnangagwa has already stated that foreign observer missions would be welcome to monitor the polls, a change from the previsions regime that tended to allow mainly ‘sweetheart’ monitors such as the Southern African Development Community (Sadc) to watch proceedings.
An acceptable poll is important for future engagements on business issues, and that may mean Zanu-PF must rein in its own over-zealous followers who may find it difficult to reform past behaviour.
Isolated incidents are expected to arise during the election campaign, but we need to take a wider and deeper view when these incidents occur.
Economic reform and policy reviews will set the tone for change, but the real test is to see Zanu-PF win a genuinely free and fair poll.