Storm clouds gather over Zimbabwe's new dawn

The relative honeymoon Zimbabwe’s new leaders enjoyed over the past year has come to an end as the country erupted in protests and demonstrations last week.

The spark was a decision made on January 12 to raise the price of petrol, which previously cost $1.43 (Dh5.25) a litre. It has now risen to $3.31, a 150 per cent increase. Fuel was already in short supply, with motorists enduring long queues of several kilometres at the petrol pumps.

The price hike was intended to stop black-market trading in fuel, but instead provoked countrywide demonstrations that quickly turned violent. Soon, disturbing images of injured and dead protesters flooded social media prompting the government to shut down internet networks. A court order on Monday night ordered that full internet access be restored.

Eddie Cross, an economist based in Zimbabwe’s second city of Bulawayo, believes government corruption and mismanagement is behind the sudden hike in fuel.

“These things should have been attended to immediately after they [new leaders] came to power,” Mr Cross said. President Emmerson Mnangagwa and his deputies took office following a military coup in November 2017 that unseated Robert Mugabe.

Since then Mr Mnangagwa has promised to depart from the inefficient and corrupt practices of the Mugabe regime. He has also undertaken to revive a stagnant economy and declared “Zimbabwe is open for business”.

However, efforts to reform the economy have been hampered by long-established patronage networks, Mr Cross says. Mugabe-era state officials were still place and the new administration had done nothing to root them out.

“They should have cleaned up their act. They should have shown no tolerance for corruption in any form,” Mr Cross says.

The effect of the protests has been pronounced, with the Confederation of Zimbabwe Industries president Sifelani Jabangwe saying the country’s economy had lost productive value amounting to $300 million during the three days of full-blown demonstrations as workers stayed at home. In addition, the Zimbabwe Stock Exchange (ZSE) halted trade for two days this week.

"We record about $100 million per day and given that some companies operated on skeletal staff in the three days, the economy loss could be between $70 million and $100 million per day," Mr Jabangwe said on Sunday.

Amid the protests emerged another similarity with the Mugabe era: the swiftness of deploying the military and police against protesters.

According to the Zimbabwean Human Rights NGO Forum – a body representing a wide range of non-governmental organisations, at least 12 people had been killed in the violence last week. Hundreds were injured and detained.

“While there is no official ‘state of emergency’ declared, the state of affairs represents a suspension of rule of law with the state arresting people without investigating them, torturing suspects and shooting civilians as well as suspending fundamental freedoms,” the organisation said.

When Mr Mugabe was toppled, Zimbabweans initially welcomed the change, with cheering crowds pouring onto the streets. Exiled communities in Johannesburg and London wept tears of joy in front of TV screens.

Many at the time did have reservations around Mr Mnangagawa, formerly Mugabe’s chief political enforcer, but hoped he would end his predecessor's ruinous economic policies. Mr Mnangagwa has since strived to soften his image and paint himself as a reformer.

Still, money has remained tight, and Mr Mnangagwa needs to keep the military and police paid, as well as civil servants. “More than 95 per cent of government income is spent on salaries,” says Nkosana Moyo, former industry minister in the Mugabe government who now heads his own political party, The Alliance for the People's Agenda.

Of the $3.31 per litre of petrol Mr Moyo says, about $2.48 is tax, or around 75 per cent. “So, government is using this to raise money for itself."

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Finding money to pay the civil service, which numbers about 305,000 people including the armed forces, is a growing problem. On January 8 the main unions representing state employees gave a 14-day notice to strike, and are demanding to be paid in US dollars. Doctors and teachers are already on strike.

Zimbabwe has not had its own currency since 2009 when the Zimbabwean dollar was scrapped in a desperate attempt to put an end to hyperinflation that reached 500 billion per cent, according to a Bloomberg estimate. Since then, the US dollar has become the currency for Zimbabwean transactions.

Actual dollars are in short supply though, since the Zimbabwean treasury cannot legally print them. It relies on deposits by exporters for its supply, and has implemented a creative variety of taxes to try and bolster the state’s own dollar holdings, of which the new fuel price is the latest example.

Early in January vice-president Constantino Chiwenga - the former general who led the coup against Mugabe, and who some believe is the real power in Harare – said the government could not afford to pay US dollars.

“In discussion with workers, government explained that it cannot go back to paying workers in US dollars, as in 2009,” Mr Chiwenga told a news briefing in Harare, broadcast on state television.

“This is because the 2009 total wage bill was around $30 million per month. Now it’s $300m per month.” This, he added, was also the equivalent of the country’s monthly dollar income from exports.

The finance minister Mthuli Ncube did say that the country would get its own currency within the next 12 months. This news has not exactly excited those who recall the hyperinflation era when The New York Times dubbed Zimbabwe the "country of the million-dollar chicken".

“We’ve put up with a lot over the years, such as inflation, dollar shortages and electricity cuts,” says Jonathan Lawrence, a Harare based businessman. “Of all these, hyperinflation was the worst. I think many of us would leave rather than go through that again.”

And the spectre of crippling inflation is starting to haunt Zimbabweans again. Since October last year the Zimbabwe inflation rate has soared from 20.8 per cent to 42 per cent in December, according to Trading Economics.

Neighbouring countries, meanwhile, are bracing for an influx of refugees if the crisis is not resolved soon. Home Affairs Minister of South Africa Siyabonga Cwele told a news briefing over the weekend that “Zimbabwe was priority number one” and that officials were monitoring border posts for increased movement.

South Africa is already a haven for a large number of Zimbabweans who have fled the economic crisis at home – as many as five million, according to some estimates.

For many exiles, Mugabe’s ousting brought hope they could soon return home. Now it appears they may have to wait a little longer.

Konat Bakota, a Zimbabwean in Cape Town, survives by earning around 100 rand a day (Dh26), watching over cars in a public parking lot while their owners are shopping. He had returned home over the December holidays to spend time with family.

“I thought maybe my time in South Africa was coming to an end. I’ve been saving to buy a car for a taxi to drive in Harare,” Mr Bakota says. “Now? What use is a taxi business if there’s no fuel, and soldiers in the streets can kill you.”

Zimbabwean authorities continue to deny that the army and police have killed protesters. Instead they blame "rogue elements" who have appropriated uniforms and carried out attacks, using protests as cover.

Mr Mnangangwa was in Russia on a state visit during most of the protests, and was set to join the Davos summit to drum up investment for Zimbabwe. He has now opted to return home, perhaps in response to rumours circulating that his deputy Mr Chiwenga has used the protests as an opportunity to try to force Mr Mnangagwa out.

Unconfirmed reports by Zimbabwean bloggers have claimed that some of the violence of the past week was between rival factions of the ruling Zanu-PF party, with death squads representing Mr Chiwenga attacking supporters of Mr Mnangagwa.

Charamba George, Mr Mnangagwa’s spokesman, took to Twitter to discount these rumours. “The president is aware of whispers of a 'palace coup' brewing amidst the current turmoil persisting in the country. We as a legally elected administration, tend not to acknowledge trivia. It is prudent of this administration to clear the air.”

Regardless of the truth, Mr Mnangagwa has tough days ahead. Bloomberg reports that the South African treasury turned down a request for $1.2 billion in emergency funding.

It is not clear who else Zimbabwe can turn to.