• "Zimbabwe Does Not Need The Diaspora"

    This photo was taken last week and shows the shelves full once again. Some say this is the extent to which the diaspora can help and that the capital projects needed to restart production and an economic turnaround are beyond them.



    We were sitting at a well-known local hotel this evening when one of the guys brought up the subject of the article on the Zimbabwe diaspora, which is in today's Zimbabwe Independent.

    Some of us at the table had not read the piece, so a copy was brought out and the bone of contention revealed. Jess read it out.

    By the time she was half way through, it appeared as though everybody in the room was now standing around our table. 

    Nothing I have seen in recent memory compares to what then ensued just in terms of the passions that were unleashed.

    One group said the Zimbabwe diaspora is not really a force to reckon with and it would be a mistake to single them out for any special expectation with regards to the economic turnaround.

    The argument says they have been remiting money all along but that money has failed to make a dent in Zimbabwe's problems. As one guy who says he works at a car dealership said, "It's sustenance money", meaning that the contribution from the diaspora is enough only to meet consumptive needs.

    He points out that right now, this is what Biti faces: just enough money to keep the Zimbabwe government ticking over, but absolutely, woefully inadequate for the heavy capital expenditure that Zimbabwe needs to get back on her feet.

    On the other hand, another group contented that the diaspora money is significant. Without it, they said, the country would have collapsed completely, but the diaspora helped ensure that petrol, diesel and other imports continued to trickle into Zimbabwe, preventing a complete meltdown.

    What is needed, they argued, is simply to organise and channel those efforts, perhaps bring together the different groups and encourage them to set up a single, well-capitalised company that could then be a viable  entity even on a regional scale.

    As most of you reading this know, I am totally against the idea of a government playing around with the markets, let alone playing God with them, creating behemoths that would be breeding grounds for favour-currying, corruption and greed.

    Government has no business doing business, full stop.

    Still, we have chosen to live by the tyranny of the majority, otherwise known as democracy, so the voice of the many would carry the day in the end.

    I am sorry to admit that I did leave before the conversation was concluded, I had an errand to run. But still, it was an engaging enough conversation that just I wanted to share it and hear what the people out there think. It is time for the majority to exercise its tyrannical rights!!

    So, of the two positions, which would you take? Can Zimbabwe not do with its diaspora if it is to achieve an economic turnaround? And, more importantly, why?

    I hope we will not see anything like the debate we see now around STERP, where people simply have blind faith in the thing yet fail to answer a simple question: name at least three policy measures proposed by STERP that would have an impact on job creation and infrastructural rehabilitation. Your answer must not include the words West, Aid, Help, Donor(s), IMF or World Bank. That is not policy. It's called begging.

    *****************************

    And a bit of a brain teaser: what exact phrase would sound inspiring if said by Winston Churchill, but chilling when said by Robert Mugabe? Answer: "We shall never surrender."

15 comments:

  1. Mama Shujaa says:

    Plain and simple, the remittances from the diaspora guarantee that trade on a micro basis continues. It is the cash goes to fathers, mothers, uncles, aunties, brothers and sisters allows the family to buy goods from the market seller. The market seller buys goods from the farmer; etc. Most of us in the diaspora are sending money to feed the extended family, not to build the next skyscraper.

    It is not the diaspora's responsibility to prop up the economy, it is everybody's responsibility; more importantly, the politicians with the guns wield the power.

  1. Petros says:

    It's like asking if I need the little finger in my hand or not. If I lose the little finger, I can still do lots of things with the same disabled hand, but could do more with a complete one!

  1. Complex says:

    @Denford:

    a bit of a digression here:

    Before the MDC came into power they always said that the issue of sanctions mentioned by Mugabe at each point were just orations of a madman. To them, there were 'targeted' sanctions that had no influence on the economics. And now Biti is the loudest in impassioned pleas to the west to remove the sanctions. So does the MDC now agree that maybe Mugabe did not mess up as much, and sanctions had their big role to play??

  1. Cynthia says:

    A lot of strong feeling here! I'm stopping by (via Mama Shujaa) for a visit from Puerto Rico where nearby Jamaica has been harmed by the World Bank policies. I like the Plato quote you have posted above-avoiding apathy is crucial and we also have to take time to evaluate the impact of aid on the entire social system. Are you saying that the money should be redirected or not given?

  1. Denford says:

    @Mama - A very insightful observation. Obama was recently encouraging Americans to go out and use their stimulus checks to buy stuff.

    The point being that economies are also made by consumer spending, and to a very significant extent. So the Zimbabwe diaspora is vital in this respect, even if they are just sending money to family and not building roads etc.

    Their families will go out and spend that money, meaning factories will have to tool up and manufacture the goods being bought. But it will mean Buying Local and Local will have to produce quality, otherwise all the money goes to the South African economy.......I was by your site yesterday, Mama and I loved the post about the upcoming 2010 soccer and the kids!

    @Petros: I think you are wrong!! The diaspora is actually not just a little finger at this time. It has the potential to help especially the local industry manufacture goods that relatives here use, which means more people will have to be employed. That is a big start.

    @Complex: you are just trying to make MDC supporters feel bad, aren't you?!!! No, seriously though, Biti and Tsvangirai do now indeed say that the "sanctions and measures" are to blame. Welshman and Tendai said at the last SADC meeting in Swaziland, "All these measures have had an impact in the economy. I was floored!

    @ Cynthia: How's Puerto Rico? I remember that, when I was a small boy and still at school, I sent a letter to Trevor Ncube, who was then editor of The Financial Gazette and is now the most successful individual publisher in Southern Africa: in the letter I said Zimbabwe shoudl refuse all aid from West....the letter was never published.

    But my point is that, I really do not think aid helps anything at all. For me, Zimbabwe's salvation lies in part-privatising our national assets.

    I know people who are ready to go into power-generation with their own money, as they are with telecoms, roads, transport etc. Out government can raise a boatload of funds by selling stakes in all the companies they started and gave monopolies to in the heydays of Mugabe socialism. That money could easily be reinvested back to revive these moribund companies.

  1. Moch Taviv says:

    "First they ignore you, then they ridicule you, then they fight you, and then you win."
    — Mahatma Gandhi

    hmm ..... mahatma
    Indonesian Blog walking

  1. Petros says:

    I think you missed the point Denford. How significant or insignificant the contribution of the diasporans is is not the issue. Why would I prefer to work with a disability no matter how small?

  1. Denford says:

    @Petros: my point is that Zimbabwe can not do without the diaspora. My response was to your likening the diaspora to a little finger, which I disagree with.

    We have unemployment of around 90% now, most of these unemployed have relatives and friends overseas and in the region who send money.

    That money can power local industry by allowing the people here to buy goods and services....it's a hot issue, I agree, but I do agree with you that the diaspora is an integral part of us, why would we deliberately choose to do without them?

    But I do not think this was the argument. The argument was that we should not put our hopes in the diaspora for Zimbabwe's turnaround because the job is simply too big for them...."subsistence money", as Lovemore said.

  1. Thokozile says:

    I totally agree with those who say the Diaspora money is subsistence money. That is exactly what it is. Its not easy to quantify the extent to which the remittances go in their contribution to the whole economy, but they do play a part, how little?, how big? is the big question.It is like boarding a bus to town, you will promote the business of the company operating the bus service,the bus will need a driver, conductor, a mechanic and a cleaner, a garage to keep it,a a security guard to look after it at the garage at night, the bus operator will have to pay Road tax, buy fuel, buy spare parts, and pay insurance, there need to be laws governing the operations of public transport service, there need to be Police Officers to enforce those laws, the list is endless. But it is all linked to the person who has to board the bus(passenger), without the passenger there is no public transport business.The public transport business creates employment for different sectors of the economy, insurance, taxes,legislators, Police, Courts, CVR etc its so interconnected. that is the same value the subsistance remittances from the diaspora has.

  1. Petros says:

    A dollar is made up of a hundred cents. Of course, Zimbabweans do not know what copper coins look like any more though reality is beginning to bite.
    Though I totally agree that what Zimbabwe needs is not aid, but direct foreign investment, the revamping of industry, mining and agriculture which all require substantial capital that must be in private enterprise, this bankrupt government will need donors (if any will blindly support the bloated cabinet) to pay civil servants for the next 3 months at least before it realizes any inflows from privatization of parastatals or increased inflows from VAT, PAYE and income tax. If that does not happen I see them going back to Gono-nomics in the very near future, of course, with disastrous consequences. I think the country needs a drying-up time from the zillions they were used to that made them to trivialize the USD, rand and pula! I also think we need better leadership in corporate fora like BCZ, ZNCC where articulation of corporate concerns on government policy, regulation etc is consistent with the leadership role the corporate world plays in creating wealth, jobs, infrastructural development etc. For example, I am extremely disappointed that it was CZI (or whoever) suggested the increase in petrol price prior to Chinamasa's budget, and how on earth we have kept quiet about the NOCZIM redemption levy just beats me. Zimbabweans are paying for well-known AND acknowledged mismanagement and corruption at NOCZIM the villains of whom are scot free to this day. The new govt. is hyperinflation-happy; they followed up that business suggestion by increasing duty on petrol even further and fuel has gone up by between 45 to 60% since the inclusive government came into being - what a showing!

  1. The Team says:

    @Thoko: but the argument is that, like Petros says, the contribution is so small that it really will not make a difference if it was not there, hence his "little finger" analogy.

    If that one person stopped riding the bus, the company will not go broke. There are other things they can do: be hired by tour groups etc and still make a profit......

  1. Petros says:

    @The Team: The hand without the little finger is a disabled hand and cannot do as much as a complete one or the Creator made a mistake in making them five fingers instead of four! Many countries in the world treasure remittances from the diaspora, so what makes Zimbabwe special to deem this contribution insignificant, especially considering the bulk of its skills is in the diaspora anyway? I think Zimbabweans are in denial mode that they have become so much poorer than they used to be and will need all the copper coins they can find to start building up again, but that cannot be done in a hurry like they would like to!

  1. There have been arguments as to the actual number of Zimbabweans living in the Diaspora but one thing is for sure that at least 60% of the workforce, and the younger generation have since left the country. If we are to assume that at least those out there would equal the number of civil servants, then there are 120,000 Zimbabweans across the globe, working full time, then it is safe to say this group now earns $2.3 billion per annum. That is already more than Zimbabwe’s production at the moment!

    Presently Zimbabweans have been remitting an average of $100 per month per person and that in isolation is nothing. Put it together and it becomes $180 million or 20% of our budget! That’s more money than you will get from tobacco the traditional biggest forex earner. Now Jamaicans in the Diaspora remit about $2 billion per year at an average rate of $225 per month and if we are to assume their average then we can get well over $500 million annually – again well above our biggest foreign currency earner!

    The way we look at these things is warped I tell you. We only consider investments when they are “significant”. But do not try to understand the economic impact of it. Since our budget represents our exact production in real currency, it means any additional money can be used as savings, investments and with the multiplier effect of banking system, you start allowing certain things you would not normally do. On another note Biti has to take this into consideration otherwise we will have inflation again soon!

    A look at the “entrepreneur generation” that started big companies such as Mawere, Masiiwa, Mutasa and the flood of bankers such as Munatsi, Kamushinda and co were all in the Diaspora who came to launch their thoughts in Zimbabwe. The reason why the likes of India and China are flourishing is because of the Diaspora coming back. The reason why Nigeria is going to finally take off is because their Diaspora is now going back. It is also the skills factor. I know people who have managed M&A deals worth over a $10 billion while local banks can’t even fund a $20 million deal. I know Zimbabweans now managing the largest chain of hotels in the world while Miekles is basically only one hotel. I know Zimbabwean engineers now in the mix of construction of airports, nuclear powers stations, largest cement factories etc. If the “entrepreneur generation” changed Zimbabwe like that, watch what we are going to have in 5-7 years!

  1. Tatenda says:

    Interesting comments. The diaspora contributions are very important in the rejuvination of the economy.
    What the government should concentrate on is ensuring that Zim companies starts operating so that the money from the diaspora is used to buy zim manufactured goods. I believe that the impact of the diaspora contribution was being diluted by the fact that the Zim economy had totally collapsed.

    A multi-faceted approach is however needed. I will only send more money back to Zim if there is a potential for return on my investments. For eg I enquired with one stockbroker about buying shares and they couldnt guarantee that I put my money in I will be able to take it out when I want.

    I also know a lot of people who interested in buying houses on mortgage in zim but problem is there is no clear focus on trying to harness that source of funds.

    Diasporas will therefore contribute on a need basis and for now I can make more money by putting my savings in SA or Bots and will only include my remittances to Zim when the economic returns are reasonable

  1. Thokozile says:

    @ THE TEAM,
    I think it is wrong to equate the impact of the Diaspora's remittances to that of one passenger on a public transport business. By referring to a passenger I was only reducing everything into the lowest terms, the same with the diaspora, its not about one Diasporan's remittances that can have meaningful effect on the economy.
    But if one as it seem to look argues that the whole Diaspora remittances are that much insignificant to the equivalent of one passenger in a public transport business, then that is out of total mischief and insufficient information regarding the remittances.
    Considering the Zim population that is in the Diaspora and the economic situation in Zim which compels even the most mean person to send something back home, the effect of such contributions to the economy in general should never be underestimated.
    Also judging by the ever-emerging Money Transfer Agencies which send money to ZIM, supplemented by various other informal channels used, it indicates that such business is brisk and there is real money getting into Zim.
    For someone to suggest that Zim can do without remittances from the Diaspora, is just mischievous.I do not know what that person will be meaning by Zim, if they mean the people of Zim, then the normal life of a very large chunk of Zimbabweans whose lives are sustained by those remittances will grind to a complete halt,with extreme and unimaginable suffering, leaving a lot vulnerable to vices like prostitution,and criminality. Will that not have a negative impact on the economy.

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