How ZANU-PF exploits Zimbabweans

The Zimbabwe African National Union-Patriotic Front has been able to exploit Zimbabweans because they are gambler-esque: “I lost the last hand, but I might have better luck next time”.

This was said by the president of the Employers’ Confederation of Zimbabwe John Mufukare who said this reasoning allowed ZANU-PF to repeatedly offer land or businesses to the masses and then only give it to the privileged few.

“Zimbabweans also owe their first allegiance to themselves and their families,” Mufukare said.

“ZANU-PF is ruthlessly exploiting these characteristics with a game of divide and conquer: give a few people something and they will protect it against all others even to their own eventual ruin and those who do not have anything will support you in the hopes that they will one day be lucky.”

Full cable:

Viewing cable 04HARARE1217, EMPLOYERS’ VIEW OF WAGES AND ECONOMY

If you are new to these pages, please read an introduction on the structure of a cable as well as how to discuss them with others. See also the FAQs

This record is a partial extract of the original cable. The full text of the original cable is not available.

UNCLAS HARARE 001217

SIPDIS

SENSITIVE

STATE FOR AF/S

USDOC FOR AMANDA HILLIGAS

TREASURY FOR OREN WYCHE-SHAW

PASS USTR FLORIZELLE LISER

STATE PASS USAID FOR MARJORIE COPSON

USDOL FOR ROBERT YOUNG

STATE FOR MARINDA HARPOLE

¶E. O. 12958: N/A

TAGS: ELAB EAID BTIO EINV ECON PGOV ZI

SUBJECT: EMPLOYERS’ VIEW OF WAGES AND ECONOMY

¶1. (SBU) Summary: On 22 July 2004, EconOff discussed

wage negotiations and economic recovery with Mr. J.

Mufukare of the Employers’ Confederation of Zimbabwe

(EMCOZ). Mufukare also related some interesting

information about price controls and the Zimbabweans’

character. Business is poor with no sign of either a

recovery or mass action for change. End summary.

¶2. (SBU) Mufukare stated that only 3 of the 45 wage

negotiation councils have reached quarterly wage

agreements. The rest are negotiating or deadlocked

awaiting arbitration. The new resultant wages range

Z$450,000-Z$680,000/month (US$84.91-US$128.30). The

negotiations are difficult but amicable as labor

recognizes business’s low costs needs and business

recognizes labor’s higher wages needs.

¶3. (SBU) With most sectors performing very poorly,

Mufukare saw no signs of an economic recovery. Mining is

able to break even because of stable global gold, nickel,

and platinum prices. But, rising labor costs and

difficulty in securing foreign exchange are tightening

their belts as well. Labor costs and lack of market

elasticity has also hurt security guard firms. Business

generally applauds Reserve Bank Governor Gideon Gono but

insist that fiscal policy must fall in line too. The

controlled exchange rate (especially the Z$824/US$1

figure for exporters) and lack of foreign exchange access

are strangling business. Many businesses purchase high-

priced items just to preserve their money’s value.

¶4. (SBU) Business worries that President Mugabe’s renewed

emphasis on “economic empowerment” may signal coming

indigenization of manufacturing companies, possibly with

commerce not too far behind. Despite prior pronouncement

without action, business fears GOZ will act this time.

¶5. (SBU) Mufukare also informed EconOff that GOZ gazetted

the price of a 10 kg bag of maize at Z$12,000 (US$2.26),

below the Z$20,000 (US$3.77) market price. This marks the

return of price controls, although businesses are

ignoring it and GOZ is not enforcing it. GOZ may use the

regulation to selectively prosecute and takeover

businesses that violate the new regulation. As with any

below market price control scheme, scarcity and

skyrocketing black market prices will result.

¶6. (SBU) Mufukare discussed the reasons for Zimbabweans’

complacency. He described Zimbabweans as gambler-esque: I

lost the last hand, but I might have better luck next

time. This reasoning allows Zanu-PF to repeatedly offer

land or businesses to the masses and then only give it to

the privileged few. Zimbabweans also owe their first

allegiance to themselves and their families. Zanu-PF is

ruthlessly exploiting these characteristics with a game

of divide and conquer: give a few people something and

they will protect it against all others even to their own

eventual ruin and those who do not have anything will

support you in the hopes that they will one day be lucky.

¶7. (SBU) COMMENT: Labor and employers agree: GOZ is the

problem. Despite difficult wage negotiations, both labor

and business stress their amicable nature. This reflects

the need for political reform prior to sustainable

economic recovery. With new price controls, people may

yet again experience food shortages and exorbitant

prices. GOZ cannot countenance the idea of allowing

market forces to work- the desire for complete control is

just too strong.

¶8. (SBU) COMMENT (CONT’D): It is surprising to hear a

Zimbabwean describe his own people as selfish and gambler-

esque. This could explain the lack of public outcry over

the drastic economic decline. It also suggests that the

vast majority will not say enough is enough until they

literally have nothing, including hope.

SULLIVAN

(82 VIEWS)