Fears for Zimbabwe economy after Mugabe rout

August 3, 2013
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Zimbabweans queue outside a branch of Barclays bank in Harare, on December 31, 2007/AFP
Zimbabweans queue outside a branch of Barclays bank in Harare, on December 31, 2007/AFP

, JOHANNESBURG, August 3 – Robert Mugabe’s apparent landslide election victory has prompted fears that Zimbabwe’s barely resuscitated economy is in for another bumpy ride.

The full results are not yet in, but Mugabe’s triumphant allies have already vowed to redouble efforts to put assets into the hands of black Zimbabweans.

“All resources must be for the benefit of our own people. We will no longer tolerate any exploitative relationship,” Justice Minister Patrick Chinamasa said on Friday.

“We are going to continue with our message that our resources must come under the control of the people of Zimbabwe.”

After land and mining grabs, Chinamasa has already singled out the country’s foreign-owned banks as targets for indigenisation.

“All the banks are British owned, that is why they are refusing to give credit to our people,” he said.

In recent years Mugabe’s ZANU-PF hardliners have talked a lot about seizing financial firms like Britain’s Standard Chartered and Barclays.

There have even been threats against South African firms like Standard Bank despite the risk of irking a powerful neighbour.

But generally cooler heads have prevailed.

“Destabilising a large bank such as Standard Chartered has serious systemic consequences that can lead to unintended results,” Zimbabwe’s central bank chief and Mugabe ally Gideon Gono said in April.

But the scale of Mugabe’s supposed victory may give the hardliners the upper hand.

And some analysts believe Mugabe, already 89 years old and trying to keep successors at bay, may have little choice but to expropriate assets and divvy up the spoils.

“The only way for ZANU-PF to maintain the loyalty of the armed forces and of its supporting structure is to find ways of extracting resources,” said Jakkie Cilliers, director of South Africa’s Institute for Security Studies.

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