Zimbabwe’s President Emmerson Mnangagwa’s win: A New Dawn or Continuation of a Legacy?

As the dust settles on the confirmation of President Emmerson Mnangagwa’s win in last month’s polls by Zimbabwe’s Constitutional Court, one begins to wonder what exactly the future is for the country.

The opposition Movement for Democratic Change Alliance and its candidate, Nelson Chamisa had brought a legal challenge saying the vote was impaired by “mammoth theft and fraud”. The rejection of this claim by the court has left Mr. Chamisa, with no alternative than to concede defeat.

It is alleged that despite accepting defeat, Nelson Chamisa has maintained that he will

Zimbabwe's President-Elect: Emmerson Mnangagwa
Zimbabwe’s President-Elect: Emmerson Mnangagwa

not refer to Emmerson Mnangagwa as president, but simply as ‘Mr’. Whatever the case, this confirmation of the election results means that 75-year-old Emmerson Mnangagwa remains as the 3rd President of Zimbabwe.

This election is Zimbabwe’s first since long-time President Robert Mugabe was ousted from power last year, in what can best be described as a ‘bloodless coup d’etat’. The question now remains as to whether this win marks a new dawn for Zimbabwean politics or it is simply a continuation of the last dispensation.

Sometime in 2011, I wrote a piece analysing the case of Zimbabwe. One of my conclusions then was that  “‘the central and dominant variable determining…developmental success or failure’ is politics. If there is any reason there is widespread poverty in Zimbabwe today, it is the poverty of its politics. This means that the solution cannot come from the same failed politics but from a “…more explicit…  integrated theory of political and economic development” which will take into account the different nuances that make up the complex and unique political entity called Zimbabwe”.

I think that my view today is not much different. People have been under the misguided impression that merely ousting Mugabe from power will usher in a new dawn for the development of the country. I felt and still feel that Mugabe’s exit, was a well-orchestrated plan to ensure that his successor is someone who will continue his legacy, without actually appearing to do so. I may be wrong, but if the current president has, throughout his political life, supported the same ideals as Mugabe, what is the guarantee that a mere change in his title will create a different vision. But, perhaps, by being voted in, he may well start bringing about policies that are aimed at improving the overall wellbeing of the masses, rather than just the political class. There is, however, no guarantee that this will happen, as has often been the case in most young African democracies.

Paul Collier has argued that the lack of checks and balances can lead democracies to make even more of a mess of a political situation than autocracies, for “…  it turns out that democracy is a little bit more complicated… Because there are two distinct aspects of democracy. There’s electoral competition, which determines how you acquire power, and there are checks and balances, which determine how you use power. It turns out that electoral competition is the thing that’s doing the damage with democracy… And so, what the countries of the bottom billion need is very strong checks and balances. They haven’t got them. They got instant democracy in the 1990s: elections without checks and balances.’

If Collier’s view is anything to go by, the current election of Emmerson Mnangagwa through electoral competition is just the first stage, and in fact, the less important one. The determining factor will be whether Zimbabwe has got the right checks and balances to ensure that the current president does not end up living a similar legacy of sitting tight when everything else around them is crumbling.

Julius Sello Malema, the leader of the South African far-left, Economic Freedom Fighters, has in one of his videos been heard to proclaim that Zimbabweans, will be the only African country in the next 10 years which will be truly independent. If this turns out to be the case, then one might agree that Mugabe might not have had a bad outcome after all. But this outcome is largely dependent on what Mugabe’s successor does. If there is true economic independence for Zimbabwe, then its current president has no excuse not to take the country into a new phase of its history.

EUSA vs Zimbabwe, Bailout vs But Out,and Other Fun Economy

The results of US and EU bailouts manifest in Mass Protests, the first Mass Strikes in the USA for Decades, a London Suburb where We The People gave a little taste of what is to come when they loose it, Mass Demonstrations and Clashes in Greece, Spain, Italy, and there is more to come in 2012. True, Occupy Wall Street and similar Manifestations in Europe are Trojan Horses, but they are an undeniable signal, indicating the fact that a large segment of otherwise well conditioned, placid populations have had so much of it that they are willing to get out into the streets and actually freeze and risk confronting the new Western Militarized Police Forces that would have left Orwell in astonishment.

The Western Bailout model had some other pretty consequences too. The Dow Jones finished 2011 at 12.217,5 which equaled a Dow/Gold ratio of 7.8, and during the first month of 2012 alone the Dow surged another 3 % DowNwards. The “real value” of the US Stock Market will most likely be ending 2012 with having lost some 85 % of it´s real value. So much to the BailOut Model of the EUSA.

I suggest that investment in Zimbabwe is a much more sound proposition than dealing in BailOut markets. Contrary to EUSAS bailouts that literally rip off entire populations, including medium and small investors who try to save for their family or otium, Zimbabwe seems to implement the model of Comply or BUT OUT.

Zimbabwe´s BUT OUT MODEL is among other manifesting in the fact that “undercapitalized banks” have been shown the boot that will be butting them out unless they comply with the regulations of Zimbabwe´s banking sector.

Yesterday the Governor of Zimbabwe´s Reserve Bank, Governor Dr. Gideon Gono informed journalists, and the banking sector, that there would be no other dead-line than the one already set at two weeks. By February 14 all undercapitalized banks should finalize their ongoing initiatives to meet minimum requirements, suggesting that some of the banks could merge, as he had advised before. In other incidents share holders would need to dilute their stake to inject fresh funds to save banks, instead of clinging to their shareholding.

The banks most likely to be confronted with Dr. Gono´s and Zimbabwe´s BUT OUT BOOT are Royal, ZABG and Genesis Investment Bank. Zimbabwe´s Finance Minister Tendai Biti advised that share holders should consider if it was wise to hold on to old ownership structures, and then to go under with a 100 % shareholding.

Comparing Zimbabwe´s sound BUT OUT MODEL, I would suggest that investing in Zimbabwe is a far more sound idea than investing at a drug and drug money dependent Wall Street, where the gamble is about whether one is lucky to invest in one of the crime cartels that are too big to fail – and even if one is lucky enough to win that gamble, one is assured that ones stock will be loosing 85 % of it´s real value during 2012 ?

Bailout ? Or But OUT !!! It´s Your Funeral so You decide for Yourselves. I know where I would be investing my money. Considering the Dow/Gold Ratio and the fact that we can expect the real value of EUSA´s stocks to loose 85 % in 2012, I´d invest in Gold, and keep a good part of it, safely at a Bank in Zimbabwe.

Source: Christof Lehmann (nsnbc Editor)

01.02.2012